African Economic Integration Essential for Growth and Competitiveness
The economic integration of Africa is crucial for stimulating growth and enhancing the competitiveness of businesses on the continent. However, the implementation of the African Continental Free Trade Area (AfCFTA) remains incomplete, hindered by regulatory, logistical, and financial obstacles.
The AfCFTA agreement, which came into effect in 2019, aims to create a single African market by facilitating trade between countries on the continent. Nevertheless, several challenges persist, including the need to harmonize trade policies and improve infrastructure. To address these issues, the Africa Economic Report 2025 proposes clear recommendations.
Concrete Measures!
Firstly, governments must accelerate the full implementation of AfCFTA. This involves reducing tariffs, eliminating non-tariff barriers, and unifying trade policies. Additionally, it is essential to strengthen national implementation committees and involve the private sector more extensively.
Furthermore, the development of regional value chains should be a priority. Sectors such as agro-processing, automotive, pharmaceuticals, and renewable energy require targeted investments and increased support for small and medium-sized enterprises (SMEs).
Moreover, climate policies must be integrated into AfCFTA implementation. Carbon pricing and financing renewable energy, such as solar and wind power, are essential levers. By 2040, Africa's energy transition could require investments of $22.4 billion.
Additionally, modernizing customs procedures and adopting digital technologies, such as blockchain and electronic data processing, are indispensable. Improving digital infrastructure, including high-speed networks and data centers, will facilitate e-commerce and innovation.
Gender Equality is Key
Gender equality is also a major challenge. It is necessary to remove barriers preventing women from participating in cross-border trade and support women-led SMEs by facilitating their access to financing, education, and digital skills.
Regional Economic Communities (RECs) Harmonization
Finally, harmonizing trade policies between Regional Economic Communities (RECs) will reduce fragmentation and improve AfCFTA's coherence. The free movement of people, goods, and capital should be encouraged through initiatives such as the African Single Air Transport Market and the Pan-African Payment and Settlement System.
Sustainable Urban Development
Beyond these economic aspects, the report emphasizes the importance of sustainable urban development. Investing in affordable housing, clean water, and sanitation is essential for managing rapid urbanization. Creating jobs in cities, particularly in services and the informal economy, will also contribute to reducing youth unemployment.
