But what’s the AfCFTA?
The AfCFTA is a continental free trade area which currently includes 52 of the 55 members of the African Union (AU). The purpose of the agreement is to establish a single market in Africa which allows for the free movement of goods and eventually people and investments across the continent. The agreement officially went into effect on May 30th 2019. According to the AU, the AfCFTA is the largest free trade area since the creation of the World Trade Organization in 1995¹.
The benefits for participating countries
The AfCFTA will constitute a single market of 1.2 billion people and a GDP of over $2.5 trillion. The agreement is expected to boost intra-African trade which currently stands at an abysmal 15%. This rate is very low when compared to intra-trade in Europe (67%) and Asia (58%). One way in which it promises to boost trade among African countries is by gradually eliminating almost all tariffs and barriers. The agreement requires all members to eliminate tariffs on 90% of their tariff lines².