Customs project aims for more harmonised procedures

While the African Continental Free Trade Area (AfCFTA) has faced criticism for making limited progress, important groundwork is already being laid to turn the agreement into practical trade. According to Easy Clear general manager Michael Henning, the direct impact on the customs software provider has so far been nominal. However, this does not mean that little has happened. “There has been a significant impact on the South African Revenue Service (SARS), with updates to tariff schedules and the registration process for producers and exporters wanting to benefit from the preferential trade agreements,” he told Freight News. According to Henning, South Africa’s inaugural shipment under the AfCFTA in 2024 highlighted early export opportunities for mining equipment, appliances, plastics and machinery. It also demonstrated that the preferential tariff agreement was not purely theoretical but could be applied in practice using a platform such as Easy Clear. At the same time, the expansion of intra-African trade in manufactured and processed goods, including automotive and agricultural products, is creating new opportunities and supporting stronger regional value chains. Given South Africa’s position in the region, Henning said some of the most immediate opportunities lay in trade with neighbouring countries, including Zambia, Zimbabwe, Mozambique, Botswana and Namibia. “The automotive industry offers a big opportunity for local OEMs and component manufacturers to expand into these regional African value chains and into the wider intra-African market.” According to Henning, the planned AfCFTA Customs Modernisation Project could also support this growth. The 20-year, $3.1-billion concession agreement will see digital and physical infrastructure deployed to reduce border delays and replace manual customs processes with more harmonised procedures. This is good news as non-tariff barriers remain one of the biggest challenges to the implementation of the AfCFTA. “The administrative burden of understanding complicated rules of origin and product requirements for different countries, coupled with slow and inconsistent customs procedures across different countries, also adds to the already expensive infrastructural barriers of fragmented road and rail networks, port inefficiencies and congestion at various land borders,” said Henning. “Digital system failures are another challenge. Like those recently reported at the Kazungula crossing that resulted in a three- week tailback that cost road freight operators millions. They can make even a product with a zero AfCFTA tariff commercially uncompetitive because of the logistics cost involved in getting it to market.” These challenges all point to a wider problem – the AfCFTA is not being implemented at the same pace across the continent. According to Henning, progress on procedures and documentation remained slow, while rules of origin were still complex. The agreement had therefore not yet created a seamless trading environment. “The practical application of the agreement differs from one border to another,” he said. “Countries are also at different stages of digitisation and implementation. South Africa is relatively advanced, while others still rely heavily on manual declaration processes.” Rules of origin remain a particular obstacle, made more difficult by inconsistent customs requirements and the number of agencies involved in clearing goods at some borders. The challenge also extends beyond customs processes to whether Africa’s physical transport infrastructure is ready to support the increase in trade envisaged under the agreement. LV