African Economic Community (AEC)

Prepared by the Economic Co-operation and Development Department (EDECO)

Long before the establishment of the OAU, African leaders had recognised that cooperation and integration among African countries in the economic, social and cultural fields are indispensable to the accelerated transformation and sustained development of the African continent. This was concretised in 1963 in the objectives of the OAU Charter, as well as in the OAU Summits of 1973 and 1976, and the Monrovia Declaration of 1979. In 1980 the OAU Extraordinary Summit adopted the Lagos Plan of Action, as a major step towards that goal. During that Summit, the African leaders stated their commitment, individually and collectively, to promote the economic integration of Africa, in order to facilitate and reinforce social and economic intercourse. They also committed themselves to promote the economic and social development and integration of their economies and, to that end, to establish national, regional and subregional institutions leading to a dynamic and interdependent African economy, thus paving the way for the eventual establishment of the African Economic Community.

The commitments in the Lagos Plan of Action and the Final Act of Lagos were translated into concrete form, in Abuja, Nigeria, in June 1991 when the OAU Heads of State and Government signed the Treaty establishing the African Economic Community. The AEC Treaty has been in operation since May 1994 when the required number of instruments of ratification for its coming into force were deposited with the Secretary General of the OAU/AEC.

At the regional and subregional levels, African countries have embarked on various programmes for the promotion of integration, and have established organisations and institutions to support their effort. So far, the AEC has established direct working relations with the Economic Community of West African States (ECOWAS) in the West African region, the Economic Community of Central African States (ECCAS) in the Central region, and in the East and Southern region, the Common Market for East and Southern Africa (COMESA). In the Southern Region the AEC has been dealing with the Southern African Development Community (SADC). In North Africa, there is the Arab Maghreb Union (UMA) which has no direct contact with the AEC, so far. Apart from these Regional Economic Communites (RECs), there are other groupings like the Economic and Monetary Union of West Africa (UEMOA) and the Customs and Economic Union of Central Africa (UDEAC), all of which are engaged in the promotion of integration. All these organisations were already in existence and operating when the AEC Treaty was signed in Abuja in June 1991.

The major characteristics of the African Economic Community compared to similar communities is that it is being established in six stages, according to the provision of the Abuja Treaty (Articles 6 and 88), mainly activities of the RECs. This makes the AEC different from other integration organsations. In fact the Abuja Treaty makes it clear that the establishment of the AEC is the final objectives towards which the activities of all the RECs (existing and future) shall be geared (Article 88). In recognition of this fact, the Abuja Treaty has set up the modalities for establishing the AEC; they consist of six stages of variable duration over a transition period not exceeding thirty four years, from the date of entry into force of the Treaty. Each of the stages consists of specific activites to be implemented concurrently.

First Stage (five years)

Strengthening of existing RECs and establishing new ones in regions where they do not exist.

Second Stage (eight years)

(i) At the level of each REC, establishing tariff and non-tariff barriers, customs duties and internal taxes at the May 1994 level, and determination of the time table for the gradual liberalisation of regional and intra-community trade, and for the harmonisation of customs duties vis-a-vis third states;

(ii) Strengthening of sectoral integration, particularly in the fields of trade, agriculture, money and finance, transport and communications, industry and energy; and

(iii) Coordination and harmonisation of the activities of RECs.

Third Stage (ten years)

At the level of each REC, the establishment of Free Trade Area and a Customs Union.

Fourth Stage (two years)

Coordination and Harmonisation of tariff and non-tariff barriers among various RECs with a view to establishing a Continental Customs Union.

Fifth Stage (four years)

Establishment of an African Common Market (ACM).

Sixth Stage (five years)

Consolidation and strengthening of the structures of the ACM, including free movement of peoples and factors of production; creation of a single domestic market and Pan African Economic and Monetary Union, African Central Bank and African Currency; Establishment of a Pan African Parliament.

Despite the above six stages, the Abuja Treaty states that the cumulative transitional period shall not exceed forty years from the date of its entry into force. It also provides for measures to be taken concurrently, with regard to the formulation of multinational projects and programmes for the promotion of a harmonious and balanced development among Member States. However, the stages are not inflexible; the process can be expedited with regular verification of completion of the stages.

Relations between the AEC and RECs

The Abuja Treaty has accorded special recognition to the critical role of the Regional Economic Communities in the stages of establishing the African Economic Community. Accordingly, a Protocol has been concluded on Relations between the AEC and RECs, which should serve as an effective instrument and framework for close cooperation, programme harmonisation and coordination as well as integration among the RECs on the one hand, and between the AEC and RECs on the other. This Protocol has the major advantage of enhancing the status and role of the OAU Secretariat which is also the Secretariat of the AEC, in all matters pertaining to the implementation of the Abuja Treaty.

In November 1996, the Economic and Social Commission (ECOSOC) of the AEC held its first ministerial session in Abidjan, cote d'Ivoire, and interalia, adopted its work programme which is designed to accelerate the integration process in the continent. The AEC Assembly of Heads of State and Government held its inaugural session in Harare, Zimbabwe on 2 June 1997. This was a momentous occasion in the process of African economic integration. The session was addressed by the current Chairmen of ECOWAS, COMESA, ECCAS, IGAD, SADC and UMA, on the progress achieved in their respective regions in the implementation of the AEC.

Organs of the Community

The Community has the following organs:

  1. The Assembly of Heads of State and Government;
  2. The Council of Ministers;
  3. The Pan-African Parliament;
  4. The Economic and Social Commission;
  5. The Court of Justice;
  6. The General Secretariat; and
  7. The Specialised Technical Committees (seven in number as follows):
  8. The Committee on Rural Economy and Agricultural Matters;
  9. The Committee on Monetary and Financial Affairs;
  10. The Committee on Trade, Customs and Immigration Matters;
  11. The Committee on Industry, Science and Technology, Energy, Natural Resources and Environment;
  12. The Committee on Transport, Communications and Tourism;
  13. The Committee on Health, Labour and Social Affairs;
  14. The Committee on Education, Culture and Human Resources.

The Treaty has different chapters and articles covering various issues in all the above social and economic sectors, and the operating modalities of its organs as well. In addition, there are provisions on the legal aspects of the Treaty as well as on the function of the high officials of the Secretariat.


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