The African Union is committing the continent’s eight regional blocs to creating a single market for goods and services. Intra-regional trade varies from 5.4% to 90% depending on the regional bloc. Informal cross-border trade accounts for around 40% of trade in sub-Saharan Africa. Africa’s untapped export potential is estimated at 21.9 billion dollars, or 43% of intra-African exports. Partial tariff liberalisation under the AfCFTA could generate additional export potential of $9.2 billion over five years.
The 2018 Agreement Establishing the African Continental Free Trade Area (AfCFTA) recognises regional economic communities as pillars of intra-African trade. This text commits the member states of the eight regional blocs recognised by the African Union to creating a single market for goods and services facilitated by the movement of people in order to deepen the continent’s economic integration, in line with Agenda 2063.
« We should have a continental working group, more or less a kind of joint secretariat made up of the AfCFTA Secretariat, the regional economic communities, the private sector and partner institutions to provide secretariat services for continental integration. And of course, the legal status of the regional economic communities will be clarified because they are actively participating in the AfCFTA ».
Francis MANGENI , Adviser to the AfCFTA Secretariat
According to figures from the African Union, intra-regional trade stands at 86% in East Africa, 90% in SADC, 78% in COMESA and 5.4% and 13.8% respectively in ECCAS and ECOWAS. To achieve the goal of bringing together 1.3 billion people in a 3.4 billion dollar economic bloc, experts are calling for greater productive integration of African economies.
« When defining the objectives of this type of platform or these institutions, I think that the area of trade complementarity as well as that of reducing the diversity of trade policies should be at the centre of attention. So any kind of arrangement has to be based on a programme, and this is where the boost to intra-African trade has to come in ».
Wumi OLAYIWOLA, Programme Officer, Research and Statistics Directorate – ECOWAS – Nigeria
Informal cross-border trade accounts for around 40% of trade in sub-Saharan Africa. According to official data, Africa’s untapped export potential currently stands at $21.9 billion, representing 43% of intra-African exports. Partial tariff liberalisation under the AfCFTA over the next five years could unlock an additional $9.2 billion in export potential.
« The AfCFTA is an opportunity to rethink the debate on African regional integration so that we reach the stage where we can say that African integration has truly come of age. At the end of the day, the AfCFTA is just one of many protocols, one of many flagships of Agenda 2063. We need to make it work, as well as the protocol on freedom of movement through the African passport that is supposed to be promoted. These are other things that need to come to life now that the AfCFTA is here.
Emmanuel BENSAH, Deputy Executive Director of the AfCFTA policy network
Trade within Africa comprises 61% processed and semi-processed products under the AfCFTA’s Guided Trade Initiative. This is the second largest free trade area in the world. Its objective is to increase the level of continental trade from 18% to 25% in 10 years, and to promote intra-African trade to the tune of 35 billion dollars a year.