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A Time for Trade

“It’s time for Africans to trade among themselves”

This statement is often repeated in business circles, and while it seems like a no-brainer for Africans to trade with each other, it is not as simple as one may think. In 2021, intra-African trade stood below 15% of total African exports1. This level of regional trade is considerably lower than levels of intra-regional trade across the world. The lack of intra-African trade is a significant impediment to economic development and deep regional integration across the continent. 

The graph below represents levels of intra-regional trade across the world regions1.

The African Continental Free Trade Area (AfCFTA) presents an opportunity to overcome the barriers to intra-African trade. The purpose of the African Continental Free Trade Area (AfCFTA) is to boost intra-African trade by providing a comprehensive and mutually beneficial trade agreement among the member States. The scope of the AfCFTA covers trade in goods and services, investment, intellectual property rights, and competition policy.

The UNCTAD forecasts show the AfCFTA could boost intra-African trade by about 33% and cut the continent’s trade deficit by 51%. But the AfCFTA is not a silver bullet. Structural issues such as a lack of infrastructure, insufficient and asymmetric access to information, and political instability cannot be overcome by a trade agreement. Such issues require unwavering political will and regional cooperation in order to create an enabling environment for effective trade under the AfCFTA.

In line with the AU Agenda 2063, the AfCFTA should establish a single market for products and services, ease travel for individuals, and support industrial development as well as equitable, sustainable socio-economic growth. While we are still in the early stages of the implementation of the AfCFTA, we are optimistic that the AfCFTA’s application serve as a key propeller towards creating African prosperity.

How Allegro can support your organisation?

Through our knowledge and networks, we provide an authentically African, holistic approach to intra-continental trade that addresses the strategic, economic, regulatory, tax and finance implications of commercial transactions. 

1 Source: UNCTAD (2021)

2 African Union Elaboration of the 2021-2030 Priority Action Plan for the AU Program for Infrastructure Development in Africa (PIDA):  The Integrated Corridor Approach – “A Holistic Infrastructure Planning Framework to establish PIDA-PAP 2”

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2 Σχόλια

Mayibongwe Gumbo
Mayibongwe Gumbo
05 Φεβ

Africa trading freely for mutual economic benefit and sustainable growth. AfCFTA - For Africa, To Grow Africa!

Μου αρέσει

05 Φεβ

Intra-regional trade in Africa has been so much lower than what we are capable of - looking forward to the positive impact the AfCFTA will have on the continent

Μου αρέσει
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