Finance:African Economic Community

Short description: International organization

  Members of the AEC's parent, the African Union

The African Economic Community (AEC) is an organization of African Union states establishing grounds for mutual economic development among the majority of African states. The stated goals of the organization include the creation of free trade areas, customs unions, a single market, a central bank, and a common currency (see African Monetary Union) thus establishing an economic and monetary union.

Pillars

Currently there are multiple regional blocs in Africa, also known as Regional Economic Communities (RECs), many of which have overlapping memberships. The RECs consist primarily of trade blocs and, in some cases, some political and military cooperation. Most of these RECs form the "pillars" of AEC, many of which also have an overlap in some of their member states. Due to this high proportion of overlap it is likely that some states with several memberships will eventually drop out of one or more RECs. Several of these pillars also contain subgroups with tighter customs and/or monetary unions of their own:

These pillars and their corresponding subgroups are as follows:

Pillars	Subgroups
Community of Sahel-Saharan States (CEN-SAD)
Common Market for Eastern and Southern Africa (COMESA)
East African Community (EAC)
Economic Community of Central African States (ECCAS/CEEAC)	Economic and Monetary Community of Central Africa (CEMAC)
Economic Community of West African States (ECOWAS)	West African Economic and Monetary Union (UEMOA) West African Monetary Zone (WAMZ)
Intergovernmental Authority on Development (IGAD)
Southern African Development Community (SADC)	Southern African Customs Union (SACU) Common Monetary Area (CMA)
Arab Maghreb Union (UMA)

Pillar membership

  member states; year of joining

  member states; year of joining; cooperation in the framework of the bloc stalled

  candidate states; year of application

CEN-SAD Founding states (1998): Burkina Faso Chad Libya Mali Niger Sudan Joined later: 1999: Central African Republic 1999: Eritrea 2000: Djibouti 2000: Gambia 2000: Senegal 2001: Egypt 2001: Morocco 2001: Nigeria 2001: Somalia 2001: Tunisia 2002: Benin 2002: Togo 2004: Ivory Coast 2004: Guinea-Bissau 2004: Liberia 2005: Ghana 2005: Sierra Leone 2007: Comoros 2007: Guinea 2008: Kenya 2008: Mauritania 2008: São Tomé and Príncipe

COMESA Founding states (1994): Burundi Comoros Djibouti Eritrea Ethiopia Kenya Madagascar Malawi Mauritius Rwanda Sudan Eswatini Uganda Zambia Zimbabwe Joined later: 1999: Egypt 2001: Seychelles 2006: Libya 2018: Tunisia 2018: Somalia Former members: 1994-1997: Lesotho 1994-1997: Mozambique 1994-2000: Tanzania 1994-2004: Namibia 1994-2007: Angola

EAC Founding states (2001): Kenya Tanzania Uganda Joined later: 2007: Burundi 2007: Rwanda 2016: South Sudan ECOWAS Founding states (1975): Benin UEMOA-94 Burkina Faso UEMOA-94 Ivory Coast UEMOA-94 Gambia WAMZ-00 Ghana WAMZ-00 Guinea WAMZ-00 Guinea-Bissau UEMOA-97 Liberia WAMZ-10 Mali UEMOA-94 Niger UEMOA-94 Nigeria WAMZ-00 Senegal UEMOA-94 Sierra Leone WAMZ-00 Togo UEMOA-94 Joined later: 1976: Cape Verde Former members: UEMOA-94: UEMOA state from 1994 UEMOA-97: UEMOA state from 1997 WAMZ-00: WAMZ state from 2000 WAMZ-10: WAMZ state from 2010

ECCAS Founding states (1985): Burundi Cameroon CEMAC-99 Central African Republic CEMAC-99 Chad CEMAC-99 Congo CEMAC-99 DR Congo Equatorial Guinea CEMAC-99 Gabon CEMAC-99 Rwanda withdrawn 2007-2016 São Tomé and Príncipe Joined later: 1999: Angola CEMAC-99: CEMAC state from 1999

IGAD Founding states (1986): Djibouti Ethiopia Kenya Somalia Sudan Uganda Joined later: 1993: Eritrea 2011: South Sudan UMA1 Founding states (1989): Algeria Libya Morocco Tunisia

SADC Founding states (1980): Angola Botswana SACU-70 Lesotho SACU-70 Malawi Mozambique Eswatini SACU-70 Tanzania Zambia Zimbabwe Joined later: 1990: Namibia SACU-90 1990: South Africa SACU-70 1995: Mauritius 1997: DR Congo 1997: Seychelles withdrawn 2004-2007 2005: Madagascar SACU-70: SACU state from 1970 SACU-90: SACU state from 1990

¹ The UMA (Arab Maghreb Union) does not participate in the AEC so far, because of opposition by Morocco

Overlaps illustrated

REC pillars of the African Economic Community.   CEN-SAD   COMESA   EAC   ECCAS   ECOWAS   IGAD   SADC   UMA

Active REC pillars of the African Economic Community.   COMESA   EAC   ECCAS   ECOWAS   SADC

Other blocs

Other trade blocs in Africa not part of the African Economic Community.

  GAFTA

  CEPGL

  COI

  LGA

  MRU

Other African regional blocs, not participating in the AEC framework (many of them predating AEC) are:

• Greater Arab Free Trade Area (GAFTA) (an organization of most Middle Eastern states, including those outside Africa)
• Economic Community of the Great Lakes Countries (CEPGL)
• Indian Ocean Commission (COI)
• Liptako-Gourma Authority (LGA)
• Mano River Union (MRU)

Their membership is as follows:

GAFTA 1	CEPGL	COI	LGA	MRU
2005 membership: Egypt Libya Morocco Sudan Tunisia Joined later: 2009:Algeria	1976 membership: Burundi DR Congo Rwanda	1984 membership: Comoros Madagascar Mauritius Seychelles	1970 membership: Burkina Faso Mali Niger	1973 membership: Liberia Sierra Leone Joined later: 1980: Guinea 2008: Ivory Coast

¹ Only African GAFTA members are listed.
GAFTA and MRU are the only blocs not currently stalled.

Goals

The AEC founded through the Abuja Treaty, signed in 1991 and entered into force in 1994 is envisioned to be created in six stages:

1. (completed in 1999) Creation of regional blocs in regions where such do not yet exist
2. (completed in 2007) Strengthening of intra-REC integration and inter-REC harmonisation
3. (completed in 2021) Establishing of a free trade area and customs union in each regional bloc
4. (to be completed in 2023) Establishing of a continent-wide customs union (and thus also a free trade area)
5. (to be completed in 2025) Establishing of a continent-wide African Common Market (ACM)
6. (to be completed in 2028) Establishing of a continent-wide economic and monetary union (and thus also a currency union) and Parliament

• End of all transition periods: 2034 at the latest

Stages progress

as of September 2007

• Stage 1: Completed, only Arab Maghreb Union members and Sahrawi Republic not participating. Somalia is participating, but no practical implementation yet.
• Stage 2: Steady progress, nothing factual to check.
• Stage 3:

	Regional blocs - pillars of the African Economic Community (AEC)
Activity	CEN-SAD	COMESA	EAC	ECCAS		ECOWAS			IGAD	SADC		UMA
				CEMAC	Common	UEMOA	WAMZ	Common		SACU	Common
Free Trade Area	stalled	progressing 1	fully in force	fully in force	proposed for 2007 ?	fully in force		proposed	stalled	fully in force	progressing 2	stalled
Customs Union	stalled	proposed for 2008	fully in force	fully in force	proposed for 2011 ?	fully in force		proposed for 2007	stalled	fully in force	proposed for 2010	stalled

¹ Members not yet participating: DR Congo (in talks to join), Eritrea, Ethiopia, Seychelles (in talks to join), Swaziland (on derogation until SACU gives permission for Swaziland to join the FTA), Uganda (to join very soon)[1]
² Members not yet participating: Angola, DR Congo, Seychelles [2]

• Stage 4: In March 2018, 49 African countries signed the African Continental Free Trade Agreement paving the way for a continent-wide free trade area. The continental free trade area became operational in July 2019, after 22 ratifications. As of 2021, 34 signatories have effectively become parties of the treaty.
• Stage 5: no progress yet
• Stage 6: no progress yet

Overall progress

		Activities
Regional bloc		Free Trade Area	Economic and monetary union			Free Travel		Political pact	Defence pact
			Customs Union	Single Market	Currency Union	Visa-free	Border-less
AEC		Partially In Force	proposed for 2023	proposed for 2023	proposed for 2028	proposed for 2023	proposed for 2023	proposed for 2028	proposed for 2028
CEN-SAD		proposed for 2010
COMESA		in force 1	proposed for 2008	?	proposed for 2018
EAC		in force	in force	proposed for 2015	proposed for 2024	proposed for 2018	?	proposed for 2023
ECCAS	CEMAC	in force	in force	?	in force
	Common	proposed for 2007 ?	proposed for 2011 ?	proposed	proposed	proposed	?		in force
ECOWAS	UEMOA	in force	in force	proposed	in force
	WAMZ			?	proposed for 2012
	Common	proposed 2	proposed for 2007	proposed	proposed	in force 1	proposed	proposed	in force
IGAD
SADC	SACU	in force	in force		de facto in force 1	?
	Common[3]	proposed for 2008 3	proposed for 2010	proposed for 2015	proposed for 2016
UMA

¹ not all members participating yet
² telecommunications, transport and energy - proposed
³ sensitive goods to be covered from 2012

African Free Trade Zone

The African Free Trade Zone (AFTZ) was announced on Wednesday October 22, 2008 by the heads of Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC).

In May 2012 the idea was extended to also include ECOWAS, ECCAS and AMU.

See also

• African Economic Outlook
• Economy of Africa
• Economy of the African Union

Sources

• A single African currency in our time?
• African leaders agree to form single market
• African Union Official Website
• South African webpage on RECs
• Pan-African Perspective