Opportunities for service-led businesses under the AfCFTA agreement
At the 2024 Epsilon Publishers Annual General Meeting, Lynda Ouma, a Senior Trade Development Officer at the State Department for Trade in Kenya, delivered an insightful presentation on the African Continental Free Trade Area (AfCFTA) Agreement and the opportunities it presents for service-led industries.
Her discussion focused on how businesses can position themselves to capitalise on the expanded African market. As part of our commitment to transforming lives through our work and publications, we continuously seek opportunities to deepen our understanding of the impact of our initiatives. We aim to identify ways to enhance value and share transformative works on a global scale. In line with this mission, we explored the business opportunities presented by the AfCFTA Agreement for our industry.
The AfCFTA Agreement presents an unprecedented opportunity for service-led businesses to expand across Africa. By understanding the regulatory framework, monitoring national policies, leveraging digital transformation, and utilising trade facilitation tools, businesses can position themselves for success in the continent’s rapidly integrating economy. As more countries liberalise their service sectors, early movers will have a significant advantage in tapping into Africa’s vast and growing market.
Kenya was among the first nations to sign the AfCFTA Agreement during the AU Summit in Kigali, Rwanda. It swiftly ratified the agreement and deposited its ratification instruments with the African Union, demonstrating a strong commitment to regional economic integration. Since then, Kenya has remained actively involved in implementing the Agreement, advocating for a unified and expansive trade environment across the continent.
To effectively navigate this emerging market, the publishing industry must first understand the AfCFTA regulatory framework. This involves familiarising with protocols on trade in services, rules of origin, and dispute resolution mechanisms, as well as staying updated on national policies that impact cross-border service provision in various African countries.
The Protocol on Trade in Services defines how businesses can offer services across member states. Compliance with these rules is crucial, as failure to do so can result in penalties, service restrictions, or even business shutdowns. Additionally, each country under the Agreement has specific commitments regarding which service sectors are open to foreign providers. Understanding these commitments will allow the publishing industry to identify markets with minimal licensing barriers, enabling smoother entry and operation.
Another key aspect is leveraging Rules of Origin (RoO) to gain a competitive advantage. While RoO primarily apply to goods, certain service sectors may also be subject to local content requirements. Therefore, our sector must ensure they meet the criteria for “African-origin services” to qualify for preferential treatment under AfCFTA.
Despite AfCFTA’s goal of harmonising trade rules, individual countries maintain their own licensing, taxation, and sector-specific requirements regulations. Staying informed about these differences ensures we adapt our strategies accordingly. Some countries may offer better incentives, such as tax breaks or relaxed market entry requirements for foreign service providers. Businesses that track these policies can identify the best expansion opportunities. Equally important is to be proactive about regulatory changes in digital services, professional licensing, and financial policies that can prevent disruptions and ensure smooth operations. Where disputes occur, the Dispute Settlement Mechanism under AfCFTA provides legal recourse for businesses facing unfair restrictions or contractual breaches. Understanding this mechanism ensures service providers can safeguard their interests and resolve disputes efficiently.
For an industry with significant global growth potential, the AfCFTA presents a strategic opportunity for the publishing sector to explore new avenues for expansion. It provides a platform for companies looking to extend their reach, capitalise on emerging markets, and engage in cross-border trade or partnerships, ultimately enhancing their impact on a global scale.
