Economic Trends

Regional Economic Communities Driving Sustainable Economic Growth in Africa

26 Feb 2023

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IBAN: 978-9948-797-06-7

AED 10

Executive Summary

Regional integration in Africa has long been a feature of its trade relations. Despite the many regional economic communities in existence in Africa, the continent has only seen 17% intra-African trade. It is indeed easier for Africa to trade with foreign countries than with itself. Many factors have led to this situation, including both tariffs and non-tariff barriers. In addition, it seems that Africa's leaders cannot subordinate national interest to regional interest. Conflicts within regions have aggravated the situation. The reality is that there are many opportunities on the continent, despite the many challenges decision-makers face in managing trade relations. The AfCFTA has been hailed as a mechanism to deal with the opportunities and challenges on the continent. It promises to provide many benefits to African economies. At this stage, the AfCFTA is still only potential as, until quite recently, no trade has taken place under the auspices of the AfCFTA. Several factors have influenced this sad situation. Fortunately, the recently adopted Guided Trade Initiative (GTI) has sparked potential trades. This paper addresses the purpose and benefits of regional economic agreements, with specific reference to the AfCFTA. It also addresses the challenges facing regional economic integration in primarily East Africa. The paper also identifies the potential in the pharmaceutical, automotive, and agricultural sectors. In addition, it identifies some of the measures to boost and measure the level of regional integration, as well as specific initiatives to boost the AfCFTA.