AfCFTA: Seizing opportunities for a prosperous Africa.

However, the African Continental Free Trade Area (AfCFTA) is a beacon of hope, offering significant opportunities for businesses across the continent.

The AfCFTA Business Forum that took place in Cape Town, South Africa, from 16 - 19 April this year brought together more than 1,000 policymakers, business leaders, and key stakeholders to discuss the potential of this ambitious initiative.

The forum took place at a time when there is waning confidence in the multilateral trading regime, and concerns are growing about the unequal distribution of benefits and burdens, inefficiency in decision-making, loss of sovereignty, and politicization of global governance.

The ongoing discussion regarding the effectiveness of multilateralism, particularly in the face of global economic and geopolitical shifts, underscores the importance of finding domestic solutions to national and continental issues.

The African Continental Free Trade Area (AfCFTA) is a beacon of hope, offering significant opportunities for businesses across the continent.

Given this context, it is increasingly compelling to pursue the pan-Africanist concept of a single African market, which would create a continental market of 1.3 billion people with a combined GDP of $3.4 trillion, making it the largest free trade area in the world since the establishment of the World Trade Organization.

The AfCFTA is expected to boost intra-African trade by 52.3 per cent by 2025, increase Africa's income by up to $450 billion by 2035, according to the IMF, and lift 30 million Africans out of extreme poverty.

However, intra-African trade currently accounts for only 15 per cent of the continent's total trade, compared to 58 per cent in Asia and 67 per cent in Europe.

The AfCFTA has been in effect for two years, and 2023 has been designated the "Year of AfCFTA: Acceleration of the African Continental Free Trade Area Implementation" by the African Union.

Infrastructure funding gap

The AfCFTA Business Forum discussed the importance of seizing opportunities and investments created by a single African market, but emphasized the need to improve the continent's infrastructure, which requires $130-170 billion annually.

Currently, there is a funding gap of $68-108 billion, resulting in only 34 per cent of the population having access to electricity and 40 per cent living more than 5km from the nearest all-season road.

These challenges contribute to high logistics costs, which can account for up to 40 per cent of...