## How to Modernize Customs Procedures to Successfully Implement the African Continental Free Trade Area

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### Purpose, context, and scope
- Context and timeline:
  - AfCFTA conceived by the African Union in 2012; negotiations started in 2015 and completed in 2018.
  - Entered into force on May 30, 2019, when the required number of State Parties (24) had deposited their instruments of ratification.
  - Trading under the agreement officially began on January 1, 2021; active start in October 2022 with the Guided Trade Initiative.
  - At time of preparation, 47 signatories had deposited their instruments of AfCFTA ratification.
- Scale and potential impacts:
  - 54 member countries, total population of 1.3 billion, gross domestic product estimated at US$3.4 trillion.
  - World Bank estimate: could boost regional incomes by as much as 9 percent by 2035, creating almost 18 million more jobs and helping up to 50 million people exit extreme poverty (Echandi, Maliszewska, and Steenbergen 2022).
  - 2023 IMF study: in an “AfCFTA+ scenario ... the median bilateral trade flow between African countries would grow by 53 percent, of which 15 percentage points would be from tariff and non-tariff measure reductions, and the remaining 38 percentage points from improvements in the trade environment.”
- Purpose and scope:
  - Discuss and propose recommendations on priority reforms and actions in customs administration to optimize AfCFTA implementation for trade in goods.
  - Based on analyses by the authors and IMF experts and extensive discussions with representatives of 48 national customs administrations, seven RECs, and the World Customs Organization through regional workshops in 2023 and early 2024.
  - A regional one-year deadline for implementation of the most relevant measures is desirable.
- Core customs challenges under the Protocol on Trade in Goods:
  - Tariff removal for “African-made” goods requires enhanced management, professional, and technological capacities to (i) promote and facilitate access to preferential treatment by compliant traders and (ii) verify compliance with AfCFTA rules of origin and impede abuse, to avoid revenue leakage and unfair competition.
  - Facilitated cross-border trade within Africa requires modern and efficient procedures supported by advanced technologies to allow secure and easier circulation of goods and compliance with border and clearance formalities, including by SMEs.

### Main recommendations for customs administrations
- Strategic moves:
  - Expand the “economic” function: publish procedures, inform and advise traders, proactively encourage voluntary compliance and proper use of the agreement.
  - Implement transformative reforms: overhaul administrative processes, expand digitalization efforts, invest in advanced technologies.
  - Prevent and detect abuse efficiently without impeding legitimate business.
  - Improve coordination among customs administrations and with other government agencies and invest in personnel preparation.
- Tariff removal and origin management:
  - Treat implementation of the AfCFTA and capacity to manage AfCFTA rules of origin as a top priority in the short, medium, and long term.
  - AfCFTA State Parties should appoint Customs as the sole “Designated Competent Authority” to manage AfCFTA origin and to implement customs-related provisions, particularly the Protocol on Trade in Goods and its annexes.
  - Promote the use of the Origin Declaration (OD) issued by approved exporters: approved by Customs in the producing/exporting country after a thorough verification disconnected from the export clearance process.
  - Develop a peer-to-peer infrastructure and shared data storage (customs portal) between AfCFTA State Parties to support electronic transmission of proofs of origin, record of origin information, and for consultation by customs administrations on a need-to-know basis.
  - Facilitate compliance by publishing official comprehensive and easy-to-use information on AfCFTA rules and procedures in each country and offering web services to traders for preferential origin requests and approvals through the customs portal.
  - Develop intelligence and data analysis capacities, including mirror data analysis, on trade flows and country of origin of exchanged commodities.
  - Collect data and monitor transactions pertaining to shipments of US$5,000 or less claiming AfCFTA preferential treatment (ODs issued by nonapproved exporters).
  - Create or strengthen an operational specialist origin unit within customs, designated as the focal point for customs, traders, and other stakeholders to deal with all export and import matters of origin.
- Facilitated cross-border trade:
  - Implement preventive measures including:
    - a set of mandatory key data elements to be shared and used for clearance of the same shipment on both sides; and
    - an AfCFTA-trader electronic verified account.
  - Enhance predictability through authorized economic operators’ programs, advance rulings, and implementation of key performance indicators.
  - Remove nontariff barriers that originate from customs procedures and practices; based on modern risk management and coordinated border management, significantly reduce examination rates for intra-Africa trade.
  - Continue aligning import valuation procedures and methods to the World Trade Organization (WTO) Valuation Agreement and resolve inconsistent tariff classifications among members of the same regional economic community.
  - Streamline and better control cargo transit operations with action plans distinguishing national and regional responsibilities.
  - Focus on conversion of the AfCFTA Transit Document (TD) into an electronic document; invest in transit traceability technologies; strengthen sanctioning frameworks for fraudulent transit operators; coordinate with ministries of transportation; and improve systems for access, management, and collection of financial guarantees.
  - Use mobile telephony to simplify procedures and declarations for SMEs and to attract informal traders to formality.
  - Adopt WCO tools as the base for standardization of procedures across Africa.
  - Request capacity development support on AfCFTA implementation from development partners, where needed, including from the WCO and the IMF.

### Tariff elimination timelines, scope, and implications
- Key figures and timelines:
  - In less than 10 years, 97 percent of the intra-African trade in goods meeting AfCFTA preferential origin criteria will be exempt from duties.
  - Tariff elimination has started aggressively, encompassing 90 percent of tariff lines (nonsensitive goods), while the other 7 percent of goods (sensitive) are granted a more gradual phase-out schedule. The remaining 3 percent of tariff lines have been excluded from liberalization.
  - Timetable as described:
    - 90 percent of tariff lines—nonsensitive goods: Elimination over 5 years (General); Elimination over 10 years (Least Developed Countries).
    - 7 percent of tariff lines—sensitive goods: Elimination over 10 years (General); Elimination over 13 years (Least Developed Countries).
    - Up to 3 percent of tariff lines that represent no more than 10 percent of the country’s intra-African imports: Excluded from liberalization (both General and Least Developed Countries).
- Status of RoO and tools:
  - As of preparation, the rules of origin have not been completed for all goods, impacting rollout of tariff elimination schedules.
  - The AfCFTA Secretariat has published an e-tariff book and Rules of Origin (RoO) Manual, but these tools are still incomplete.
- Revenue and fiscal considerations:
  - AfCFTA eliminates customs duties on AfCFTA-originating goods, but not Value Added Tax and excise/special taxes, which are levied by each country and are expected to grow because of expanded trade and economic activity.
  - An increase in imports of inputs from outside Africa for manufacture of export products, as well as consumer goods, is expected; both will be subject to customs duties and taxes.
  - World Bank estimates: boost Africa’s income by $450 billion by 2035 (a gain of 7 percent), increase Africa’s exports by $560 billion, mostly in manufacturing, and boost wages by about 10 percent.
  - An IMF team in 2019 concluded limited reductions in fiscal revenue from AfCFTA implementation, with exceptions:
    - Revenue loss would amount to about 0.5–0.8 percent of GDP, depending on the assumed elasticities.
    - In a few countries, revenue losses may be as large as 3–5 percent of GDP.
  - Distinction: trade revenue loss and trade revenue leakage are not the same. Customs must apply trade provisions while preventing abuse, trade fraud, and revenue leakage.

### Rules of origin, proofs, and origin-control architecture
- Qualification and proof of origin:
  - A good shall be deemed as originating in the AfCFTA if it has been wholly obtained or undergone a substantial transformation in an AfCFTA State Party.
  - Valid proofs of origin (if recognized by customs) include:
    - A Certificate of Origin (CoO) issued by the exporting State Party’s Designated Competent Authority, or
    - An OD issued by an Approved Exporter (approved by the exporting State Party’s Designated Competent Authority), or
    - An OD issued by any exporter for any consignment containing originating goods whose total value does not exceed US$5,000.00.
  - Agreement provides criteria on wholly obtained goods, substantial transformation, and other elements (packing and packaging; separation of certain materials; accessories and spare parts; what is deemed a set; neutral elements not conferring origin). Monitoring of Accumulation of Origin, Principle of Territoriality, and Direct Transportation are key.
  - The agreement grants Customs or the Designated Competent Authority the right to call for any evidence and to carry out any inspection of the exporter’s accounts or any other verification considered appropriate.
- Institutional responsibilities:
  - Strong arguments for designating customs as the sole Designated Competent Authority: customs possess tariff classification and valuation expertise, legal powers for audits and inspections, trade data holdings, international mutual assistance agreements, and deployment at all ports.
  - Certification and verification of AfCFTA origin must be performed by each country’s Designated Competent Authority; only customs authorities of the exporting country can conduct verification following a request from importing customs.
- Shifting origin control to export side and pre-export verification:
  - Case for shifting center of gravity of origin control to export side: producers/exporters must maintain supporting documentation and exporters’ preapproval reduces routine import-side checks.
  - Encourage ODs by Approved Exporters via a preapproval process; ODs act as a “blanket certificate” while CoOs are one-time per good.
  - Create an AfCFTA-exporter approval program (similar to AEO), collect and maintain detailed transaction data, and share permanently updated lists of approved exporters and qualifying goods with other African customs administrations.

### Origin units, diagnostics, and data use
- Origin units:
  - Many existing origin units have limited resources and lack AfCFTA preparation.
  - Origin units should be strengthened or created to:
    - On the export side: conduct reliable certifications and verifications of origin.
    - On the import side: support risk management and verification while avoiding overlaps.
  - Core functions: trade data analyses and origin intelligence; technical support for verifications and audits; IT coordination for tariff-related processing codes and portals; legal support for rulings and regulations.
  - Origin units should be national focal points and channels for access to restricted origin information stored in the AfCFTA Customs Portal.
- Optimal use of data and risk techniques:
  - Implement regular mirror data analyses using UN COMTRADE or similar databases or data-sharing agreements.
  - Enhance risk management using predictive models and intelligence on production capacities and production anomalies.
  - Collect intelligence and maintain databases to guide targeted origin verification and post-clearance audit.

### AfCFTA Customs Portal and technology options
- Purpose and core functions:
  - Formalized, computerized communications among customs administrations for exchanging certificates of origin electronically, tracking exporting authorities’ actions, verifying exporter audits/approvals, and implementing mutual administrative assistance.
  - Centralized official technical information: AfCFTA RoO, e-tariff book, schedule of tariff removal by HS heading/sub-heading, FAQs, points of contact.
  - Web services: simplified online interactions for traders to claim preferential treatment and compliance procedures.
- Proposed peer-to-peer architecture:
  - Each customs administration maintains a dedicated AfCFTA portal server connected to the Internet with a peer-to-peer data-sharing protocol; control retained over what is shared and with whom.
  - Access controlled on a “need to know” basis for designated customs officials and traders.
- Suggested main portal functions:
  - Function 1 “File Storage”: record documentation used to certify AfCFTA origin; exporting customs deposit scanned documents for importing customs retrieval.
  - Function 2 “Legal Information”: centralized official RoO and customs procedures.
  - Function 3 “Web Services”: online services for interactions and transparency.
- Technological implementation steps and scenarios:
  - Adapt existing regional IT systems (for example, SIGMAT) to AfCFTA exchanges; SIGMAT and peer-to-peer networks can coexist.
  - Practical peer-to-peer implementation:
    - Each AfCFTA customs administration installs an Internet-connected data/document-sharing server.
    - Secure tunnels (VPNs) built between administrations.
    - Import-side customs retrieve export-side documents via peer-to-peer servers; processing can be manual or automated using software such as SIGMAT or similar.
    - Trade operators could use smartphone applications to complete declarations and transmit origin proofs saved directly to the document-sharing server.
  - Longer-term possibility: centralized automated information-sharing infrastructure with blockchain-type technologies to guarantee security and traceability.
- Standardization and WCO tools:
  - Use WCO Data Model and Globally Networked Customs (GNC) as bases for standardized data.
  - Implement a common set of mandatory core data elements and a Unique Consignment Reference to link export and import transactions.
  - Share basic core data elements as soon as file storage is available: exporter, tariff code, criterion of origin, and term.

### Risk management, inspection burden, and valuation
- Current issues:
  - High documentary and physical inspection rates with limited effectiveness; semi-automated risk management allows excessive discretion and potential corruption.
  - Numerous examinations by other government agencies increase inspection burden.
- Recommended changes:
  - Segment AfCFTA and non-AfCFTA traders by CIF values and goods; use a simple risk-evaluation scale.
  - Develop fully automated and dynamic risk management systems with modules that automatically update selectivity criteria in “real time.”
  - Implement integrated risk management addressing root institutional causes and coordinate strongly with tax administrations.
  - Assess customs processes to identify vulnerabilities from paper-based procedures and automate; conduct necessity tests on documentation; implement coordinated border management (CBM) with customs leading and requiring formal government approval.
- Customs valuation principles (Box 3 recommendations):
  - Separate risk analysis phase and value determination phase.
  - For risk analysis: use objective indicative price data from external sources.
  - For value determination: rigorously follow WTO Valuation Agreement provisions, including Ministerial Declaration 6.1 and formal interaction with the importer.
  - Expand control to cases with possible related-party influences on price, coordinated with transfer pricing tax implications.
  - Apply a deterrent sanction framework for fraudulent presentation of commercial documentation.

### Circulation, transit, Annex 8, and transit modernization
- Annex 8 and transit opportunity:
  - Annex 8 provides for the use of a TD in all land transit transactions within the AfCFTA territory and establishes procedures and requirements for management and authorization of carriers and drivers.
  - Annex 8 supports the principle of one single transit, regardless of the number of countries crossed.
- Immediate transit actions:
  - Replace existing transit documents with the TD.
  - Make the TD electronic (not explicitly provided for in the Agreement) and supported by national IT systems.
  - Routinely reconcile departure, intra-Africa border crossing, and final destination data.
- Investments and operational measures:
  - Invest in electronic seals and geo-tracking devices for end-to-end traceability, scanning as substitute for physical inspection, and scanning image sharing among departure and final destination offices.
  - Strengthen sanctioning frameworks: higher fines, higher penalties (confiscation of means of transport), and removal of fraudulent operators from the AfCFTA customs transit registry.
  - Cooperate with ministries of transportation to maintain a pool of compliant operators.
  - Governments must upgrade infrastructure and resolve governance issues including corruption and harassment on transit corridors.
  - RECs may help standardize IT solutions, eliminate transit disruptions at internal borders, and introduce a regional guarantee program.

### Tariff classification, SMEs, informal trade, and NTBs
- Tariff classification:
  - Most AfCFTA parties have implemented or are implementing HS 2022; discrepancies in classification remain common.
  - Recommendation: establish tariff classification committees at REC level (and possibly continental level) to resolve inconsistent classifications.
- SMEs and mobile telephony:
  - There are 44 million SMEs in Africa.
  - Mobile telephony: 23 percent of Africans access the Internet through their smartphones; expected to rise to 30 percent by 2030.
  - Customs could develop smartphone applications for regulatory information and simplified self-prepared customs declarations shareable with customs on both sides.
  - Supra-national development by RECs is recommended to pool costs and ensure coherence.
- Informal trade:
  - Informal trade is significant; AfCFTA parties should attract informal traders to formality by simplifying compliance and lowering costs while increasing risks and costs of informality.
  - Customs could provide mobile applications for informal trade, consider a reduced flat-tax rate on low-value shipments for particular tariff lines, and coordination with tax administrations to improve registration.
  - Targeted traders must be precisely defined to prevent abuse.
- Removal of customs-origin NTBs:
  - Many NTMs/NTBs implemented by customs or other agencies generate trade frictions; State Parties committed to address customs-related NTBs including valuation, tariff classification, and formalities.

### Implementation urgency, timeline, and institutional priority
- Customs administrations are key for successful AfCFTA implementation: process legitimate claims promptly to sustain use of the agreement and trade growth while protecting revenue by ensuring only compliant traders obtain preferential benefits.
- Resources and tools required: modern technologies, proper training, structural adaptations, and strong government support.
- The authors estimate most key actions could be completed within one year.
- Critical task: each State Party must appoint a capable Designated Competent Authority to handle technical and operational complexities of African origin determinations to eliminate tariffs; customs administration is best positioned for this role.

*Source: IMF How to Note 2025/002 (htnea2025002).*

### references.

### How to Modernize Customs Procedures to Successfully Implement the African Continental Free Trade Area

### Purpose of the Note
- Context and timeline:
  - AfCFTA conceived by the African Union in 2012; negotiations started in 2015 and completed in 2018.  
  - Entered into force on May 30, 2019, when the required number of State Parties (24) had deposited their instruments of ratification.  
  - Trading under the agreement officially began on January 1, 2021; active start in October 2022 with the Guided Trade Initiative.  
  - At time of preparation, 47 signatories had deposited their instruments of AfCFTA ratification.
- Scale and potential impacts cited:
  - 54 member countries, total population of 1.3 billion, gross domestic product estimated at US$3.4 trillion.  
  - World Bank estimate: could boost regional incomes by as much as 9 percent by 2035, creating almost 18 million more jobs and helping up to 50 million people exit extreme poverty (Echandi, Maliszewska, and Steenbergen 2022).  
  - 2023 IMF study: in an “AfCFTA+ scenario ... the median bilateral trade flow between African countries would grow by 53 percent, of which 15 percentage points would be from tariff and non-tariff measure reductions, and the remaining 38 percentage points from improvements in the trade environment.”
- Purpose and scope:
  - Discuss and propose recommendations on priority reforms and actions in customs administration to optimize AfCFTA implementation for trade in goods.  
  - Based on analyses by the authors and IMF experts and extensive discussions with representatives of 48 national customs administrations, seven RECs, and the World Customs Organization through regional workshops in 2023 and early 2024.  
  - A regional one-year deadline for implementation of the most relevant measures is desirable.
- Core challenges for customs administrations under the Protocol on Trade in Goods:
  - Tariff removal for “African-made” goods: require enhanced management, professional, and technological capacities to (i) promote and facilitate access to preferential treatment by compliant traders and (ii) verify compliance with AfCFTA rules of origin and impede abuse, to avoid revenue leakage and unfair competition.  
  - Facilitated cross-border trade within Africa: require modern and efficient procedures supported by advanced technologies to allow secure and easier circulation of goods and compliance with border and clearance formalities, including by SMEs.

### Main recommendations
- Overarching strategic moves expected from customs administrations:
  - Expand their “economic” function: publish procedures, inform and advise traders, proactively encourage voluntary compliance and proper use of the agreement.  
  - Implement transformative reforms: overhaul administrative processes, expand digitalization efforts, invest in advanced technologies.  
  - Prevent and detect abuse efficiently without impeding legitimate business.  
  - Improve coordination among customs administrations and with other government agencies and invest in personnel preparation.
- Tariff Removal for “African-Made” Goods:
  - African customs administrations should treat implementation of the AfCFTA and capacity to manage AfCFTA rules of origin as a top priority in the short, medium, and long term.  
  - AfCFTA State Parties should appoint Customs as the sole “Designated Competent Authority” to manage AfCFTA origin and to implement customs-related provisions, particularly the Protocol on Trade in Goods and its annexes.  
  - Promote the use of the Origin Declaration (OD) issued by approved exporters: approved by Customs in the producing/exporting country after a thorough verification disconnected from the export clearance process.  
  - Develop a peer-to-peer infrastructure and shared data storage (customs portal) between AfCFTA State Parties to support electronic transmission of proofs of origin, record of origin information, and for consultation by customs administrations on a need-to-know basis.  
  - Facilitate compliance by publishing official comprehensive and easy-to-use information on AfCFTA rules and procedures in each country and offering web services to traders for preferential origin requests and approvals through the customs portal.  
  - Develop intelligence and data analysis capacities, including mirror data analysis, on trade flows and country of origin of exchanged commodities.  
  - Collect data and monitor transactions pertaining to shipments of US$5,000 or less claiming AfCFTA preferential treatment (ODs issued by nonapproved exporters).  
  - Create or strengthen an operational specialist origin unit within customs, designated as the focal point for customs, traders, and other stakeholders to deal with all export and import matters of origin.
- Facilitated Cross-Border Trade within Africa:
  - Implement preventive measures to facilitate and improve compliance, including:
    - a set of mandatory key data elements to be shared and used for clearance of the same shipment on both sides; and  
    - an AfCFTA-trader electronic verified account.  
  - Enhance predictability of customs administration through authorized economic operators’ programs, advanced rulings, and implementation of key performance indicators.  
  - Remove nontariff barriers that originate from customs procedures and practices. As part of this exercise:
    - based on modern risk management and coordinated border management, significantly reduce examination rates for intra-Africa trade;  
    - continue aligning import valuation procedures and methods to the World Trade Organization (WTO) Valuation Agreement; and  
    - resolve inconsistent tariff classifications among members of the same regional economic community.  
  - Draw up action plans to streamline and better control cargo transit operations, distinguishing between national and regional authorities capable of solving each problem.  
  - Customs to focus on:
    - conversion of the AfCFTA Transit Document (TD) into an electronic document;  
    - investment in technologies for better traceability and control of transit;  
    - strengthened customs sanctioning framework applicable to fraudulent transit operators;  
    - strengthened cooperation and coordination with national ministries of transportation; and  
    - improve systems for access, management, and collection of financial guarantees.  
  - Use mobile telephony to simplify procedures and declarations for SMEs and to attract informal traders to formality.  
  - Adopt WCO tools as the base for standardization of procedures across Africa.  
  - Request capacity development support on AfCFTA implementation from development partners, where needed, including from the WCO and the IMF.

### The Agreement, its objectives, scope, coverage, and benefits
- Strategic objectives of the AfCFTA (State Parties identified four):
  - (i) expand intra-African trade in goods and services;  
  - (ii) increase competitiveness through economies of scale and diversification;  
  - (iii) promote industrialization, structural transformation, and gender equality; and  
  - (iv) lay the foundation for a future customs union and single market.
- Coverage and phased negotiation and implementation:
  - The AfCFTA required phased negotiations and implementation; Table 1 (in the note) shows the timeline followed by African governments to deliver the agreement’s main components.  
  - Although customs administrations play a role in various components, implementation and operation of the Protocol on Trade in Goods and its annexes, already in force, is their priority.
- The Protocol on Trade in Goods — main purpose and objectives:
  - Regulates trade in all goods, AfCFTA originating and non-originating, between traders within the AfCFTA territory.  
  - Main purpose: create a liberalized market for traders of the AfCFTA State Parties.  
  - Main objectives:
    - (a) progressive elimination of most tariffs;  
    - (b) progressive elimination of nontariff barriers;  
    - (c) enhanced efficiency of customs procedures, trade facilitation, and transit;  
    - (d) enhanced cooperation in the areas of technical barriers to trade and sanitary and phytosanitary measures;  
    - (e) development and promotion of regional and continental value chains; and  
    - (f) enhanced socio-economic development, diversification, and industrialization across Africa.
- Annexes and customs interest:
  - The Protocol contains nine annexes (some with appendixes) integral to the AfCFTA. Customs administrations have legal competencies and interest particularly in:
    - Annex 2 (Rules of Origin);  
    - Annex 3 (Customs Cooperation and Mutual Administrative Assistance);  
    - Annex 4 (Trade Facilitation);  
    - Annex 5 (Nontariff Barriers); and  
    - Annex 8 (Transit).  
  - Many topics in these annexes require further clarification to allow proper implementation by African customs administrations. Appendix 1 in the note provides brief descriptions and observations on these annexes.

*IMF | How to Note 2025/002 — references section, htnea2025002 - references (source PDF content).*

### Box 1. Positive Impacts of Effective and Timely Implementation of the AfCFTA

### Box 1. Positive Impacts of Effective and Timely Implementation of the AfCFTA

### For State Parties’ economies
- Intra-African trade in goods and services is expanded.
- Economic competitiveness increases through economies of scale and diversification.
- Industrialization, SMEs, and gender equality are promoted.
- Structural transformation is fostered.
- Millions of jobs are created.
- A strong foundation for a future customs union and single market emerges.

### For traders, investors, and consumers
- Greater legal certainty and uniformity of treatment in their cross-border trade transactions.
- Clear incentives to invest, including at currently underutilized locations where they can place their businesses closer to key inputs and markets, as well as for taking advantage of the agreement’s provisions on cumulation of preferential origin.
- As import, export, and transit procedures are modernized and automated, transactional costs are reduced, increasing African traders’ competitiveness.
- As customs and trade procedures, requirements, and formalities are facilitated and trade barriers removed, traders are encouraged to comply voluntarily.
- Overall, it provides easier access to new markets, lower costs (including for SMEs), and lower prices for consumers.

(Note: SMEs = Small- and medium-sized enterprises.)

### For African customs administrations
- African customs administrations are able to manage customs and trade matters better (AfCFTA and non-AfCFTA) to the extent their legal, human, and technological capacities are strengthened, as proposed in this note.
- Governance progresses thanks to standardized and automated procedures minimizing discretional decision-making and expediting operations.
- Expanded data analysis and risk management capacities ensure that only legitimate traders gain access to preferential treatment, and noncompliant ones are identified and properly sanctioned.
- Customs are able to prioritize and allocate their resources more efficiently.
- Customs’ institutional image improves as its stakeholders perceive, confirm, and trust that it is fulfilling its mandate and that a leveled playing field exists for all, inducing them to voluntary compliance.

_Source: Authors._

### Tariff elimination timelines and scope
- In less than 10 years, 97 percent of the intra-African trade in goods meeting AfCFTA preferential origin criteria will be exempt from duties.
- Tariff elimination has started aggressively, encompassing 90 percent of tariff lines, those deemed nonsensitive goods, while the other 7 percent of goods (those deemed sensitive) are granted a more gradual phase-out schedule. The remaining 3 percent of tariff lines have been excluded from liberalization.
- Table 2. Tariff Elimination Timeline under the AfCTA (as described):
  - 90 percent of tariff lines—nonsensitive goods: Elimination over 5 years (General); Elimination over 10 years (Least Developed Countries)
  - 7 percent of tariff lines—sensitive goods: Elimination over 10 years (General); Elimination over 13 years (Least Developed Countries)
  - Up to 3 percent of tariff lines that represent no more than 10 percent of the country’s intra-African imports: Excluded from liberalization (both General and Least Developed Countries)

- It is important to note that, as of the time of the preparation of this note, the rules of origin have not been completed for all goods, which is impacting the rollout of the tariff elimination schedules.
- The AfCFTA Secretariat has recently published an e-tariff book and Rules of Origin (RoO) Manual, but these tools are still incomplete.

### The revenue loss debate and role of customs
- The AfCFTA only eliminates the collection of tariffs (customs duties) on AfCFTA-originating goods, not the Value Added Tax and excise/special taxes, which are levied by each country according to their national legislation and are expected to grow because of the expanded trade and economic activity.
- An increase in imports of inputs from outside Africa for the manufacture of export products, as well as consumer goods, is expected; both will be subject to customs duties and taxes.
- The World Bank estimates the AfCFTA will boost Africa’s income by $450 billion by 2035 (a gain of 7 percent), increase Africa’s exports by $560 billion, mostly in manufacturing, and boost wages by about 10 percent.
- An IMF team in 2019 concluded limited reductions in fiscal revenue from AfCFTA implementation, with exceptions:
  - Revenue loss would amount to about 0.5–0.8 percent of GDP, depending on the assumed elasticities.
  - In a few countries, revenue losses may be as large as 3–5 percent of GDP.
  - For these countries, authorities should define clear domestic revenue mobilization policies while beginning to implement the AfCFTA.
- Trade revenue loss and trade revenue leakage are not the same thing. Customs’ strategic role is to (i) apply the trade provisions of the agreement, including the tariff elimination provisions, while (ii) preventing abuse, trade fraud, and revenue leakage by ensuring that only compliant traders and AfCFTA-originating goods are granted the benefits of the agreement.

### Qualification of origin and proof of origin required
- A good shall be deemed as originating in the AfCFTA if it has been wholly obtained or undergone a substantial transformation in an AfCFTA State Party.
- AfCFTA origin is proven and its benefits are granted when the importation of a good into any of the State Parties is supported by any of the following documents (if recognized as valid by customs):
  - A Certificate of Origin (CoO) issued by the exporting State Party’s Designated Competent Authority, based on the request and supporting documentation submitted by the exporter or its legal representative, or
  - An OD issued by an Approved Exporter (approved by the exporting State Party’s Designated Competent Authority), or
  - An OD issued by any exporter for any consignment containing originating goods whose total value does not exceed US$5,000.00.
- The agreement provides criteria and definitions on wholly obtained goods and substantial transformation, and details on when processing is not sufficient to confer origin.
- Other elements to consider include (i) packing and packaging, (ii) separation of certain materials (through accounting methods), (iii) accessories, spare parts, and tools, (iv) what is deemed as a set and how it should be treated, and (v) what are deemed neutral elements not conferring origin.
- Monitoring of Accumulation of Origin, the Principle of Territoriality, and Direct Transportation are key factors that must be observed.
- The AfCFTA acknowledges the need of having a Designated Competent Authority in each AfCFTA country responsible for the certification of origin under the agreement and provides that “the Customs Authority or Designated Competent Authority shall have the right to call for any evidence and to carry out any inspection of the exporter’s accounts or any other verification considered appropriate.”

### Main administrative issues to be addressed (observations from 2023–2024 IMF workshops)
- Most control is done by customs on the destination/import side, at the border, to protect trade revenue. This results in:
  - Numerous transactional checks at the border, creating administrative burden and unpredictability for compliant traders, which could discourage claims of AfCFTA preferential tariff treatment and hinder trade growth and integration.
  - Inefficient and ineffective use of limited customs administrations resources.
- Conducting an origin verification on import requires involvement and assistance of an administration from the export side; in many countries customs is not involved or only partially involved in origin verification on the export side.
- When partially involved in the certification process, customs officers may sign proofs of origin without assurance that origin rules criteria have been met due to:
  - An in-depth verification not conducted before export,
  - Impracticality of conducting such verifications at the time exports are cleared,
  - Verifications conducted by another entity and not properly reported or documented.
- Paper-based proofs of origin and the TD, with authorized signatures and stamping by officials, entail validation challenges and vulnerabilities:
  - Tampering,
  - Changing lists of authorized signatures,
  - Communications not supported by an infrastructure or done informally.
- To avoid these pitfalls, the AfCFTA CoO should be processed and issued electronically, and customs administrations should collect as much data as possible on ODs to support their validity. The agreement does not impede customs administrations from converting paper applications to electronic format for further practical uses.

### Shifting origin control to the export side and pre-export verification
- There is a strong case for shifting the center of gravity of origin control to the export side:
  - Producers and exporters are obliged to maintain and provide supporting documentation proving compliance with the RoO when they request an AfCFTA CoO or issue an OD.
  - Importers require certainty from such certifications and declarations because they claim preferential treatment upon importation and are subject to detailed scrutiny by importing customs.
  - The agreement grants Customs or the Designated Competent Authority the right to call for evidence and carry out inspections; serious verification before export provides guarantees and should reduce routine customs checks.
- ODs issued by Approved Exporters should be facilitated and encouraged to become the norm:
  - The issuance of an OD by an exporter is subject to a preapproval process by the Designated Competent Authority, which must verify that the exporter provides evidence proving goods fulfill applicable AfCFTA RoO.
  - ODs provide a “blanket certificate” for qualifying goods exported by the approved exporter, for as long as the condition and nature of such goods remain; CoOs are requested one time for one good.
  - To manage risks, customs administrations should:
    - Create an AfCFTA-exporter approval program, similar to an Authorized Economic Operator (AEO) program, but focused on AfCFTA origin and exporter verification, starting with frequent exporters of goods whose origin is easily determined and progressively moving toward more complex cases. If feasible, an AEO certification process may include the AfCFTA-exporter approval.
    - Collect and maintain detailed data pertaining to these transactions for proper monitoring of ODs issued by approved exporters. The permanently updated list of approved exporters and their qualifying goods should be made available to other African customs administrations, and importing customs should collect detailed data on every transaction supported with an OD, including parties and goods involved, for possible future origin verification.

### Certificates of origin and institutional responsibilities
- Certificates of Origin (CoO) should be approved based on evidence produced and necessary verifications prior to export clearance; customs should not be pressured to sign a CoO at export clearance.
- There are solid arguments for customs administrations to be responsible for AfCFTA origin management and control; they are the best-positioned agencies to be appointed the sole “Designated Competent Authority.”
- The agreement provides that certification and verification of origin must be performed by each country’s Designated Competent Authority, which must have the capacity to conduct such responsibilities and provide services to all traders within its territory. Some countries have appointed customs administrations as their Designated Competent Authority; others have appointed trade associations, another ministry, or combinations thereof.
- The agreement provides that only customs authorities of the exporting country can conduct the verification of the origin of exported goods, following a request from the customs authorities of the importing country.
- Certification and verification of AfCFTA origin, as well as development, implementation, and enforcement of trade compliance and facilitation measures, require expertise and institutional capacities (legal and operational); customs administrations are best-positioned to address such challenges.

_Source: Authors._

### Box 2. Main Arguments Supporting the Selection of Customs as the "Designated

### Box 2. Main Arguments Supporting the Selection of Customs as the "Designated Competent Authority" for Origin Matters under the AfCFTA Agreement

### Rationale for Designating Customs
- Customs possess the knowledge and expertise in customs and international trade matters: tariff classification, valuation of goods, criteria for origin determination (value added, non-originating material content, and change in tariff heading), and import, export, and transit procedures are all customs administration matters.
- Customs has the legal power (granted by the customs act or customs code) to conduct audits, obtain evidence, and carry out necessary verifications and/or inspections, including on-site examinations at exporting or manufacturing facilities (that is, facilities of exporters requesting to be approved to issue ODs).
- Customs collects international trade data (confidential data), stores it, and uses it in accordance with their national legislation; this is critical because determination of AfCFTA origin requires collection and analysis of trade data from verified customs declarations and external sources to identify non-originating material content and detect fraudulent claims of AfCFTA origin.
- Customs are the only authority that has international mutual assistance agreements in place allowing exchange of information for trade and customs enforcement purposes—essential as integrated value chains and origin accumulation practices expand across the continent.
- Customs have personnel deployed at all ports of entry/exit and already control origin on the import side; controlling origin on the export side expands regular responsibilities with synergies between import and export tasks.
- Customs perform a threefold mission: (i) economic (trade facilitation in particular), (ii) fiscal (revenue collections), and (iii) border control (mainly security and safety). This positions customs to balance trade facilitation and control requirements and to leverage relatively advanced technological capacities and digitalization.

### Implication and Conclusion
- The AfCFTA creates a free trade territory under specific and strict rules for intra-African trade; AfCFTA provisions do not remove or diminish customs control but require stronger management and control of customs-related rules.
- There is a strong case for African countries to designate customs as their Competent Authority for AfCFTA origin management to pursue increased intra-African trade without revenue leakage or unfair competition due to abuse of benefits.

### Customs on the Import Side of Origin Management — Optimal Use of Data
- Historically, African customs focused resources mainly on import controls with a transactional approach (starting from declarations received and high rates of documentary and physical inspections) rather than a strategic approach.
- For origin management and control, customs must effectively collect and analyze data; automation enables tracing of international trade transactions and production of intelligence to better target clearance examinations and build cases for post-clearance origin verification.
- Recommended technical steps:
  - Implement regular mirror data analyses using UN COMTRADE or similar databases or reach data-sharing agreements with relevant trade partners’ customs administrations.
  - Enhance risk management techniques using predictive models to guide targeting decisions.
  - Collect intelligence on what is produced in Africa, production capacities, and abnormal excesses in production volumes; maintain an intelligence database for extraction, comparison, and analysis.

### Monitoring and Controlling ODs for Low-Value Shipments
- Article 19 of Annex 2 of the AfCFTA Protocol on Trade in Goods allows an OD to be issued by any exporter for any consignment whose total value does not exceed US$5,000.
- Risks and enforcement considerations:
  - The US$5,000 threshold can be used by larger exporters to split shipments to avoid the preapproval process required for shipments valued above US$5,000.
  - Exporters issuing ODs must possess evidence that goods comply with AfCFTA RoO; low-value agricultural exports may be straightforward, but electronics, textiles, apparel, footwear, and branded goods present greater evidence challenges.
- Importing customs administrations should, in addition to general origin-control actions, specifically:
  - Collect data on every transaction valued at US$5,000 or less where an OD has been issued to claim AfCFTA preferential treatment (detailed data on the parties, goods, quantities, and values).
  - Analyze collected data to identify (i) exporters and importers (and agents) who frequently trade under this provision, (ii) goods, quantities, and values that may indicate shipment splitting, and (iii) goods likely lacking necessary origin supporting evidence.

### Staff Specialization and Strengthening Origin Units
- Most African customs administrations have an origin unit, but many units:
  - Have limited resources;
  - Focus on reviewing documentation submitted under regional trade agreements; and
  - Lack knowledge and preparation for AfCFTA origin issues.
- Origin units should be strengthened or created to:
  - On the export side: conduct reliable certifications and verifications of origin to protect agreement credibility.
  - On the import side: support risk management and verification while avoiding overlaps with other specialized units.
- Core functions and resourcing for origin units:
  - Conduct trade data analyses and gather origin intelligence.
  - Provide technical support to customs verifications (field offices and post-clearance audit).
  - Work closely with IT to maintain tariff-related processing codes and origin matters in systems and portals.
  - Provide technical support to legal units for origin-related rulings and regulations.
- Origin units should be the national focal point for origin management and the channel for access to restricted origin information stored in the AfCFTA Customs Portal.

### An AfCFTA Customs Portal — Purpose and Core Functions
- AfCFTA-specific administrative needs:
  - Formalized, computerized operational communications among customs administrations for exchanging certificates of origin electronically, tracking actions by exporting authorities, verifying exporter audits/approvals, and implementing mutual administrative assistance.
  - Official, comprehensive, precise, and binding technical information on an official portal to enable compliance and predictability.
  - Easy-to-use procedures for businesses to claim preferential treatment; avoid paper-based cumbersome certification processes.
- Proposed peer-to-peer customs portal architecture:
  - Each customs administration maintains a dedicated AfCFTA portal server connected to the Internet with a peer-to-peer data-sharing protocol, allowing each country to retain control over what is shared and with whom.
  - Access controlled on a “need to know” basis; only designated customs officials (electronic signatures and personal identification numbers) and traders (for business/compliance purposes) granted consultation access.
- Suggested main functions of the customs portal:
  - Function 1 “File Storage”: record information, documentation, and data used to certify AfCFTA origin; exporting customs could deposit scanned documents for importing customs to retrieve; standardization of shared files recommended.
  - Function 2 “Legal Information”: centralized official and up-to-date AfCFTA RoO and customs procedures, e-tariff book, schedule of tariffs removal by HS heading/sub-heading, FAQs, and points of contact.
  - Function 3 “Web Services”: online services to simplify and make interactions with customs transparent.

### Selected Implementation Issues and Technological Options
- Existing regional IT systems (for example, SIGMAT) can be adapted to AfCFTA exchanges; SIGMAT and peer-to-peer networks can coexist.
- Many customs websites are not designed for easy trader access or to facilitate AfCFTA compliance; administrations should:
  - Develop easy-to-use trader solutions for access to AfCFTA information and compliance procedures; and
  - Work with other AfCFTA customs administrations to standardize provided information, starting with those within their REC.
- Data-sharing reluctance exists due to legal or technological protection concerns; most RECs and Annex 3 of the Protocol on Trade in Goods allow exchange, so bilateral or regional solutions are needed.
- Capacity constraints: many customs lack IT resources and desire to maintain control over shared data; adopt a progressive, incremental implementation of technological solutions.
- Longer-term possibility: centralized automated information-sharing infrastructure with document transfer processes based on blockchain-type technologies to guarantee security and traceability.

### Technology Scenario to Support Exchange of Customs Information
- Practical peer-to-peer implementation steps:
  - Each AfCFTA customs administration installs an Internet-connected data/document-sharing server.
  - Secure tunnels (VPNs) are built between administrations to allow selected connections.
  - Import-side customs retrieve export-side documents via the peer-to-peer servers; processing can be manual or automated using software such as SIGMAT or similar.
  - Trade operators could use smartphone applications to complete declarations and transmit origin proofs saved directly to the document-sharing server.

### Standardization and WCO Tools
- Standardization across customs procedures increases ease of doing business and enforcement capability; harmonization should progress toward standardization.
- WCO instruments provide practical bases:
  - WCO Data Model: an internationally agreed set of combined data requirements consistent with other standards (for example, UN Trade Data Elements Directory); useful for improving data quality and building risk profiles.
  - Globally Networked Customs (GNC): a common data model that normalizes presentation and exchange of trade/customs document data via peer-to-peer or automated networks.
- A common set of mandatory core data elements is recommended to clear shipments on both export and import sides; prerequisites:
  - Harmonization of core data fields and filing timeframes.
  - Inclusion of a Unique Consignment Reference (per WCO recommendations) to link export and import transactions and facilitate cargo traceability.
- As soon as file storage is available via the customs portal, customs can share basic core data elements: exporter, tariff code, criterion of origin, and term.

### Predictability Measures for Customs Administration
- Important programs to expand and strengthen:
  - AEO: create or expand an AEO program targeting large exporters/importers to cover a significant percentage of imports/exports (for example, 50 percent of total imports/exports) and subject their shipments to lower inspection rates; overlap exists with programs to verify exporters authorized to issue AfCFTA ODs.
  - Advance Binding Rulings: encouraged for legal certainty and faster clearance; rulings should be shared among AfCFTA parties (via the customs portal) masking confidential information as appropriate; consider acceptance of other parties’ binding rulings as equally binding unless revoked by AfCFTA verification.
  - Key Performance Indicators (KPI): enhance quantity and quality of KPIs for strategic/operational guidance, transparency, and predictability (for example, border release times); use KPIs for benchmarking service improvements or deterioration.
- AfCFTA-trader electronic verified account:
  - Prevent misuse of identities and TINs by requiring new AfCFTA traders or legal representatives to visit customs once to present identity documents and TIN; customs provide an authenticator enabling Internet access to customs systems.
  - Require two-factor Internet authentication (password and SMS confirmation) for transactions; build a reliable database of AfCFTA traders.

### Risk Management and Reducing Inspection Burden
- Current situation:
  - African customs administrations, like other low-income economies and emerging markets, have significantly high inspection rates (documentary and physical) with limited effectiveness, indicating failing risk management.
  - Existing semi-automated risk management relies on teams/committees to maintain selectivity criteria and allows excessive discretion and potential corruption; numerous examinations by other government agencies further complicate inspection rates.
- Recommended radical changes for AfCFTA administration:
  - Segment AfCFTA and non-AfCFTA traders according to their cost, insurance, and freight values and the goods they trade, using a basic and simple risk evaluation scale.
  - Develop and implement fully automated and dynamic risk management systems supported by advanced analytical tools, with modules that automatically update selectivity criteria in “real time” based on inspection feedback and minimal human intervention.
  - Implement an integrated risk management approach addressing institutional root causes (legal framework, processes, IT systems, human resources, infrastructure) that enable operational risks (undervaluation, misclassification, falsification of origin, contraband); coordinate strongly with tax administration.
- Complementary essential measures:
  - Assess customs processes to identify vulnerabilities from paper-based procedures and automate them to become data-driven and reduce discretionary decision-making.
  - Conduct necessity tests on documentation required to export and import to reduce documentary inspections.
  - Implement a coordinated border management (CBM) approach with other competent agencies; IMF recommends customs lead CBM and exert coordinating authority, requiring formal government approval.

### Circulation, Transit, and Trade Facilitation
- Core AfCFTA objectives include progressive elimination of nontariff barriers and enhanced efficiency of customs procedures, trade facilitation, and transit of cargo.
- Challenges remain: cumbersome nonuniform procedures, prevalence of noncompliance and fraud, and administrative obstacles that penalize economic operators.
- Customs are encouraged to adopt a strategy integrating:
  - Preventive measures to secure circulation and clearance of AfCFTA goods;
  - Visible customs administration improvements and benefits for legitimate operators; and
  - Digitalization (electronic forms, automated clearance, data validation, traceability of decisions) and use of WCO tools to standardize progressively.

*Source: Authors.*

### Annex 8 to the Protocol on Trade in Goods provides for the use of a TD in all land transit transactions within the

### htnea2025002 - Annex 8 to the Protocol on Trade in Goods provides for the use of a TD in all land transit transactions within the

### Annex 8 and the opportunity for a modern transit control system
- Annex 8 provides for the use of a TD in all land transit transactions within the AfCFTA territory (for AfCFTA-originating- and non-originating-goods) and establishes procedures and requirements for management of these transactions and authorization of carriers and drivers by ministries of transportation or equivalent competent authorities.
- Implementation clarity is limited, but Annex 8 should be seen as an opportunity to achieve, for the first time, a secure, reliable, and modern transit control system in Africa.
- Current reality: virtually all transits in Africa are nationally fragmented despite international agreements on regional transit procedures. The AfCFTA TD supports the principle of one single transit, regardless of the number of countries crossed.

### Immediate customs actions recommended for transit
- Replace existing transit documents and often cumbersome declarations by the TD.
- Make the TD electronic (not explicitly provided for in the Agreement) and supported by national IT systems.
- Routinely reconcile departure, intra-Africa border crossing, and final destination data for control purposes.

### Distinguish responsibilities and what is outside customs control
- Customs administrations should separate issues they are responsible for from those beyond their control as the basis for a sound transit modernization strategy.

### Investments, technology, sanctions, and cooperation
- Customs administrations in Africa should:
  - Invest much more than presently in technology to monitor and better control transit operations, in particular electronic seals and geo-tracking devices, for end-to-end traceability, scanning as a substitute for physical inspection, and scanning image sharing among departure and final destination offices for control.
  - Strengthen sanctioning frameworks, including by imposing higher fines, higher penalties (that is, confiscation of means of transport), and removal of fraudulent operators from the AfCFTA customs transit registry.
  - Build stronger cooperation with ministries of transportation or competent authorities licensing carriers and drivers, with a view to maintaining a pool of only compliant operators.
- Governments must upgrade infrastructure and resolve governance issues, including corruption and harassment of carriers and drivers on transit corridors.
- RECs may help standardize IT solutions, eliminate transit disruptions at internal borders, and introduce a regional guarantee program.

### Removal of nontariff barriers (NTBs) generated by customs
- Many NTMs/NTBs do not originate from customs, even if customs implements them; nevertheless, the protocol enunciates specific customs-related functions where NTBs are commonly found, including customs valuation, tariff classification, and customs formalities.
- State Parties have committed to address these customs-related NTBs.

### Customs valuation: problems and IMF recommended principles (Box 3)
- Issue identified: traders report customs valuation as among the most burdensome; values are often determined arbitrarily and compliant traders unfairly penalized.
- Observed misalignment between reported adherence to WTO Valuation Agreement provisions (including WTO Decision 6.1) and practice on the ground.
- Recommended principles to strengthen customs valuation in low-income countries:
  - Clearly separate the following two phases: risk analysis and determination of the value.
  - For risk analysis: use objective indicative price data collected from external sources to detect potential anomalies in declared values (use internal data only when it comes from thoroughly verified previous customs declarations).
  - Regarding the value determination phase: rigorously follow the WTO Valuation Agreement provisions, including Ministerial Declaration 6.1, which prescribes formal interaction with the importer to receive justification of the declared value and the conditions set for the application of each authorized valuation method.
  - Expand customs control to cases where links between provider and importer may have influenced the price of the goods. This should be done in connection with the tax implications of transfer pricing, regardless of whether trade revenue is to be collected or not.
  - Apply a well-designed sanction framework that is a deterrent to repetition of fraudulent behavior, notably presentation of false or falsified commercial documentation to customs.

### Tariff classification and institutional remedies
- Almost all AfCFTA parties have implemented, or are in the process of implementing, the 2022 version of the Harmonized System (HS 2022).
- Discrepancies in classification of commodities in the HS nomenclature remain common in practice.
- Recommendation: establish a tariff classification committee with participation of experts from national customs administrations at the regional economic community level to resolve inconsistent tariff classification of the same good among member countries; a similar arrangement could be considered at the continental level.

### Tailoring procedures to trader segments: SMEs and informal trade
- SMEs:
  - There are 44 million SMEs in Africa.
  - Mobile telephony can facilitate SME access to trade: currently 23 percent of Africans access the Internet through their smartphones, and this rate is expected to rise to 30 percent by 2030.
  - Customs could develop smartphone applications to provide up-to-date regulatory information and enable simplified self-prepared customs declarations shareable with customs on both sides for the same shipment.
  - Supra-national development by RECs is recommended to pool costs and ensure coherence and compatibility of mobile applications.
- Informal trade:
  - Informal trade in Africa is significant; AfCFTA parties should introduce policies to attract informal traders to formality by simplifying compliance and lowering costs while increasing the risks and costs of informality.
  - Customs could provide a mobile application for informal trade with further simplification than for SMEs, consider a reduced flat-tax rate on low-value shipments for particular tariff lines under a low-value threshold, and exemption from certain nontariff regulations.
  - Coordination with tax administrations is essential to improve trader/taxpayer registration.
  - Targeted traders deemed part of the informal sector should be precisely defined to prevent abuse.

### Implementation urgency, role of customs, and timeline
- Customs administrations are key players for successful AfCFTA implementation and must process legitimate claims for preferential treatment promptly and efficiently to sustain use of the agreement, trade growth, and positive economic effects.
- Customs must protect revenue collections by ensuring only compliant traders obtain preferential benefits (tariff elimination).
- Resources and tools needed: modern technologies, proper training, structural adaptations, and strong government support.
- The authors estimate that most of the key actions could be completed within one year.
- Critical task: each State Party must appoint a capable Designated Competent Authority to handle technical and operational complexities of African origin determinations to eliminate tariffs; the customs administration is best positioned for this role.

### Appendix summary: brief description of Annexes to the AfCFTA Protocol on Trade in Goods
- Annex 1 on Schedules of Tariff Concessions: Fifty-four State Parties means 54 different tariff reduction/elimination schedules.
- Annex 2 on RoO: defines criteria to grant preferential treatment, admissible proofs of origin, issuance and verification of proofs of origin, role of the Designated Competent Authority, and administrative and appeal resources; Appendix IV contains RoO for goods produced with non-originating materials.
- Annex 3 on Customs Cooperation and Mutual Administrative Assistance: encourages cooperation and information exchange among African customs administrations for enforcement of AfCFTA provisions and implementation of efficient import, export, and transit procedures.
- Annex 4 on Trade Facilitation: incorporates principles and elements of the WTO’s Trade Facilitation Agreement.
- Annex 5 on Nontariff Barriers: commits AfCFTA parties to reduction/elimination of these barriers, including those deriving from customs inefficiencies.
- Annex 6 on Technical Barriers to Trade (TBT): identifies nonadmissible TBT and mechanisms for elimination.
- Annex 7 on Sanitary and Phytosanitary Measures: requires coordination between customs and competent agencies for efficient clearance of affected goods.
- Annex 8 on Transit: addresses efficient processing and control over goods in transit, critical for landlocked countries, and offers a comprehensive framework.
- Annex 9 on Trade Remedies: establishes provisions on application of trade remedy measures related to trade in goods under the AfCFTA, enforced by customs.

*Source: htnea2025002 - Annex 8 to the Protocol on Trade in Goods provides for the use of a TD in all land transit transactions within the (IMF How to Note).*

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_Source: https://www.imf.org/-/media/files/publications/howtonotes/2025/english/htnea2025002.pdf_