Estimated reading time: 2 minutes
A recent report from the Economic Commission for Africa (ECA) highlighted the persistent challenges in boosting Africa’s share in global trade, which despite the implementation of AfCTA, still remains under 3%.
The findings indicate a preference for trading with nations outside the continent, overshadowing intra-African trade activities. Despite the ongoing efforts to foster regional integration, progress has been gradual, as outlined in the ECA’s assessment of regional integration in Africa.
The Programme for Infrastructure Development in Africa has encountered varied outcomes in its mission to enhance the continent’s infrastructure. Notable advancements in roads and ICT contrast with limited progress in rail and energy sectors, largely due to financial constraints.
Stephen Karingi, ECA Director for Regional Integration and Trade Division, pointed out that unconstitutional governmental changes, unemployment, and poverty are significant hurdles for the continent.
Moreover, the African Continental Free Trade Area (AfCFTA), which became operational on 1 January, 2021, has yet to yield significant results in bolstering trade among African countries.
The share of intra-African trade dipped from 14.5% in 2021 to 13.7% in 2022, with corresponding decreases in intra-African exports and imports as a percentage of total exports and imports.
The continent faces a substantial annual infrastructure funding gap, estimated between $130 billion and $170 billion. To address this, innovative financing solutions such as blended finance, sustainability-focused bonds, and debt-for-nature swaps are under consideration.
