However, as Africa’s trade capacity has expanded, the dynamics have largely remained the same – with trade outflows heading to advanced economies such as the UK, US and China, and inflows coming from the same advanced economies. Per the African Development Bank, intra-African trade constituted a meager 16.6 per cent of total African exports in 2017, as compared to intra-European trade of 69 per cent, intra-Asian trade of 59 per cent and intra-American trade of 31 per cent. This presents a significant opportunity for expanding intra-African trade, provided that existing headwinds are navigated skillfully. The African Union’s determined effort to take a stab at the intra-African trade question culminated in the African Continental Free Trade Area (AfCFTA) agreement of March 2018. Increased investment in intra-African trade would produce a positive catalytic effect on Africa’s growth story.

Source: The Star April 29, 2021 00:56 UTC