AMU - Trade and Market Integration

Trade liberalization was the main objective of the AMU establishing agenda in February 1989. The following steps to achieve the Maghreb economic union have been agreed upon; the establishment of a free trade area with the dismantling of all tariff and non-tariff barriers to trade; the creation of a customs union with a common external tariff; and the formation of a common market with free movement of persons, services, goods and capital between the member States[1].

Nevertheless, practical implementation of the integration agenda has been slow as the free trade area is not yet operational among AMU member States. More recently however, member States have been in the process of concluding the negotiations on the free trade area but they have not yet finalized the provisions on rules of origin[2]. AMU has also created working groups to deliberate on how to further harmonize national customs procedures, trade regulations as well as norms and standards for goods and services. The intra-regional trade in AMU was as low as 4.8 per cent of the total regional trade in 2012[3], which is comparatively lower than that of other REC, making it vastly below its potential[4]. In this context, member States agreed on a comprehensive plan to boost economic integration by promoting investments in infrastructure, harmonizing national customs procedures and expansion of logistics and transport services across borders in June 2012[5].

Moreover, AMU Ministers of Trade formed a committee in December 2014, to fast-track the Boosting Intra-Africa Trade initiative and to deliberate on the negotiations for the Continental Free Trade Area[6]. Yet, challenges remain. Apart from more evident challenges such as the aftermath of the Arab spring, recent instabilities in Libya, political transition in Tunisia have impeded trade and integration initiatives in the region. Trade relations between the member States have also been hampered by the overlapping membership of Algeria, Libya, Morocco and Tunisia to the Greater Arab Free Trade Area of the Arab League[7]. In fact, AMU member States indicate benefits from the removal of intra-regional tariffs within the Greater Arab Free Trade Area[8] which would make the incentives for an AMU free trade area rather unlikely.  

In December 2009, the member States decided to create the Maghreb Bank for Investment and Foreign Trade in order to boost regional financial integration and to strengthen intra-regional trade[9]. The inauguration of the Bank took place in December 2015, in Tunis, Tunisia with a net capital of US$150M to be invested in infrastructure, transportation, telecommunications and electrical power projects and programmes[10].