African Economic Integration

The need for greater African economic integration is ever urgent. In addition, by carefully calibrating growth-enhancing

policies, African countries need to work together to promote peace and stability while addressing trade obstacles, climate change, corruption, cybersecurity and the opportunities and challenges of the Fourth Industrial Revolution.

The good news is , African political leaders made a far-reaching decision to move forward with Africa’s economic integration through the African Continental Free Trade Area (AfCFTA).

The African Development Bank rightly points out a borderless Africa would lay the foundation for a viable continental market to accelerate growth and allow Africa to be more competitive in global trade and value chains. 

It would also allow industries to develop across borders, creating economies of scale for investors as they look at wider integrated markets.

It is quite lamentable Africa currently has the lowest percentage of intra-regional trade in the world at 18%, compared with 70% in Europe, 55% in North America, 45% in Asia and 35% in Latin America. 

Supporting growth and integration through the AfCFTA will be one of the key issues up for discussion at the Forum because trade is crucial to development.

Conclusion

Given weak global growth prospects and significant downside risks, our economic policies will need to strike a balance between supporting growth and creating the fiscal space to respond to emergent economic challenges. 

This means executing on fiscal consolidation now, particularly in highly indebted countries.

The policy package we prescribe should balance growth, equity and sustainability concerns, including protecting society’s most vulnerable, particularly youth and women, who tend to be left behind during economic transformations.