By: Maltiti Sayida Sadick
Hailemariam Desalegn Boshe, the former Prime Minister of Ethiopia and current board chair of Trademark Africa, recently highlighted the slow pace of intra-Africa trade, which currently accounts for just 15% of the continent’s total trade. Speaking at a summit hosted at the African Continental Free Trade Area (AfCFTA) Secretariat in Accra, Ghana, Desalegn underscored both the progress and the challenges Africa faces in fostering regional trade integration.
Despite the continent’s significant strides in economic integration, Desalegn pointed out the stark contrast in intra-regional trade compared to other continents, such as Asia, where intra-regional trade stands at over 50%. He noted that while Africa’s total merchandise exports surged by 200% between 2017 and 2023, intra-Africa trade only increased by 27% during the same period, growing from $140 billion to $190 billion.
“The political commitment to AfCFTA is strong, and we are beginning to see more African goods being exchanged,” Desalegn remarked, emphasizing that trade under the AfCFTA has become more encouraging, especially between 2017 and 2023. He also lauded the progress made toward the formation of a single African market, describing the launch of the AfCFTA five years ago as a landmark moment for the continent.
With a population of 1.2 billion people and a combined GDP of $3 trillion, Desalegn stressed that the potential for economic growth and prosperity through increased regional trade is immense. However, he also pointed out the long-standing challenges that continue to hinder trade within Africa, including inadequate trade infrastructure and colonial-era legacy systems that were not designed for regional integration.
“We have seen the export of raw materials like gold, cocoa, and coffee, only for these to return to Africa as processed goods. Our infrastructure, built by colonial powers, remains a major barrier to implementing AfCFTA fully,” he explained.
The COVID-19 pandemic further disrupted trade flows in Africa, exacerbating the difficulties faced by businesses and governments alike. Nevertheless, Desalegn emphasized the importance of Africa navigating these challenges carefully to ensure the successful implementation of AfCFTA and its long-term objectives.
The AfCFTA, which was scheduled to be fully implemented in 2020, promises to eliminate tariffs on 97% of tariff lines across member states over a specified period. Desalegn, who played a key role in the formation of the African Union’s Agenda 2063, recognized the historical importance of the AfCFTA and acknowledged the anticipated challenges, but remained optimistic about the future.
“While there have been frustrations along the way, the achievements of AfCFTA remain undeniable,” he stated. “Africa’s exports are projected to grow faster than any other region, with the World Trade Organization forecasting a 5.3% increase in 2024, up from 3.1% in 2023.”
In conclusion, Desalegn expressed confidence in the future of African trade integration, citing the commitment of African nations to the AfCFTA agreement and the growing momentum toward creating a unified, more interconnected market. He urged governments, businesses, and regional bodies to continue working together to overcome the obstacles and fully realize the economic potential of the AfCFTA.
