Trade Instruments, National Policies And Continental Transformation: Constraints And Emerging Issues For African Union Continental Free Trade Area Policy

Authors: Eke, Chukwuemeka Ifegwu Ph.D; Ahmad Baba El-yaQub Ph.D
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This paper describes how erecting barriers to continental integration, limiting full implementation of trade instruments such as the Africa Union Continental Free Trade Area, links trade agreements to non-trade issues such as full continental integration policies and under certain strict conditions, helps fully participating countries and governments to lower tariffs and/or adapt continental integration protocols (policies). Using mathematical derivation, logic, and series of arguments conditions were advanced. These are: (i) individual government’s goal is to maximize their objective functions (ii) these objective functions are sufficiently concave with respect to barriers to full adaption of continental integration (iii) the ‘no abandonment’ conditions define a space for full adaptation function (iv) inter countries, interregional, intraregional bloc’s policy outcomes are complementary in strategic terms. These findings can be used as sufficient rational for enhancing a wider acceptability in the continental free trade area policy. The paper simply recommends that imposing higher tariffs or drastically reducing tariffs of AUCFTA participating nations is optimal if the complementary relationship between the different policy position is sufficiently large, and that the non-pecuniary cross-border externalities is sufficiently valued.