A long journey towards an African Free Trade Area

經濟研究

  • 安哥拉,
  • 埃及,
  • 肯尼亞,
  • 摩洛哥,
  • 南非,
  • 坦桑尼亞,
  • 突尼斯
  • 一般經濟

2021年08月17日

The African Continental Free Trade Area has raised opportunities for both African and non-African companies. The agreement could contribute to growth after the negative impact of the Covid-19 pandemic

The African Continental Free Trade Area (AfCFTA) that came into effect on January 1st, 2021 has raised opportunities for both African and non-African companies. The agreement could contribute to accelerating African growth rates after the negative impact of the Covid-19 pandemic. The impact of the pandemic was diverse across African economies, with most suffering economic contractions, while others managed to record small growth rates.

The post-pandemic outlook is highly diverse and subject to high uncertainty. In the longer-run, the African Continental Free Trade Area (AfCFTA) could be a boost to Africa’s growth potential as the agreement foresees a fundamental liberalisation of trade in Africa in the next few years.

However, in the short-run there remains several challenges to the implementation of AfCFTA. These challenges include protectionist tendencies, insufficient capacity to expand cross-border infrastructure, political instability and weak government finances.

Overall, we expect countries to benefit the most if they already have action plans and customs procedures in-place, next to relatively low barriers to trade with other African countries.

This means that large countries, particularly South Africa, with a diversified economy and well-established trade links, will likely benefit most from AfCFTA. Other regional hubs like Kenya, Senegal and Cote d’Ivoire would also have a sound point of departure if AfCFTA will be implemented as currently planned.

Key points

  • Economies across Sub-Sahara Africa (SSA) are recovering from the severe downturn of last year. However, this growth is uneven and moderate due to the limited room of governments to support their economies. On top of this, the limited availability of vaccines and the spreading of the new delta variant in many countries has jeopardized this year’s forecasted recovery.
  • Some of the more diversified economies fared relatively well through the pandemic and will show a stronger recovery than others. Nonetheless, many will still not return to the high pre-pandemic growth figures because of high government debt that constrains public investments.
  • The AfCFTA could become the largest trade bloc in the world in terms of participating countries. Although the AfCFTA officially started on January 1, 2021, its full implementation is still a long way to go. Many countries would first need to establish the necessary customs infrastructure and required procedures to trade. So far, only Egypt, Ghana and South Africa have accomplished this.
  • There are still many challenges to overcome in order for countries to reap the full benefit of the AfCFTA agreement. Protectionist tendencies in different countries, weak infrastructure, political uncertainty, weak government finances and weak banking sectors are among the factors that delay the required processes and limit the desired outcomes.
  • Most African economies are expected to ultimately benefit from the AfCFTA. This applies particularly to the elimination of non-tariff barriers that would accelerate trade and growth in the region. The most open and diversified economies with already well-established trade links will benefit the most.
免責聲明

本網站所作聲明僅供一般參考,不應依賴用作任何其他用途。請參閱實際保單、相關產品或服務協議以了解規管條款。本網站的任何內容不應被視為Atradius任何權利、義務或責任的依據,包括進行買家盡職審查或代表閣下的任何義務。若Atradius確實對任何買家進行盡職審查,此乃出於自身承保目的,而非為受保人或任何其他人士進行。此外,Atradius及其關聯公司、聯屬公司及附屬公司在任何情況下概不就使用本網站所載資料的陳述而導致的任何直接、間接、特殊、附帶或相應的損害承擔責任。