Publication Date

2022

Document Type

Restricted

Abstract

The African Continental Free Trade Area (AfCFTA) is widely seen as an important opportunity for African countries in an increasingly globalized world. The agreement was established in 2012 by 54 of the 55 member states of the African Union (AU) to develop regional and global value chains to help grow and diversify the manufacturing sectors of African nations. The agreement was signed by all the member states of the AU but has only been ratified by 38 countries. While the AfCFTA is a successor to major agreements like the European Union’s (EU) Economic and Monetary Union (EMU), it is unprecedented both in scale and ambition. The pact connects 1.3 billion people across 54 countries with a combined gross domestic product (GDP) valued at US$3.4 trillion. The UN Economic Commission for Africa estimates that the effective implementation of AfCFTA, alongside concerted efforts to improve trade-related infrastructure and reduce import duties, would deliver a 52.3 percent increase in intra-African trade by 2022. This essay will offer a summary of the objectives of the agreement and discuss the challenges that African nations will face implementing this pioneering agreement.

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The views expressed in this paper are solely those of the author.