Will Intra-African Trade Reach a New Level?
Opportunities, challenges, and pathways forward for the African Continental Free Trade Agreement and its effects on food security.
All views expressed in the Welternährung are those of the authors and do not necessarily reflect the view or policies of the editorial board or of Welthungerhilfe.
It has been more than four years since the African Continental Free Trade Agreement (AfCFTA) was officially launched on January 1st, 2021. The launch of one of the largest free trade zones in the world, covering a market of over 1.3 billion people in 54 countries, was accompanied by great hope that it represents a transformative milestone in Africa's economic integration journey increasing intra-African trade by 53%. After close to five years, it is time to take stock of what the AfCFTA has achieved so far and what challenges its implementation currently faces.
While the AfCFTA is de jure functional since 2021, trading under the AfCFTA preferences is only possible after the tariff concessions by the State Parties are technically verified by the AfCFTA Secretariat, have been negotiated between the State Parties, and the customs system has been enabled to facilitate imports, including the processing of the AfCFTA Certificate of Origin. Tariff offers submitted covering all tariffs for all goods traded on the continent are published in the AfCFTA e-Tariff Book. To kick-start and test the AfCFTA legal framework, the AfCFTA Council of Ministers responsible for trade established the Guided Trade Initiative (GTI). Under the GTI, AfCFTA trade has been de facto happening since October 2022 for a limited number of (mostly agricultural) products in seven countries. As of February 2025, 10 countries were actively trading under the GTI.
Ratification completed, full verification still pending
As of August 2025, 54 out of 55 African countries (except Eritrea) have signed the AfCFTA treaty, of which 48 State Parties have ratified and submitted their instruments of ratification to the African Union Commission (AUC). Due to the existing and overlapping Regional Economic Communities (REC) and associated free trade agreements in Africa, tariff concessions are submitted by individual countries and the existing RECs. Tariff concessions need to be “Technically verified” (in line with the agreed modalities) and gazetted. As of today, not all countries have made these steps to be able to trade under AfCFTA preferences.
The tariff elimination schedule of the AfCFTA is gradual, and the process will not be completed until 2035. Most member states have committed to eliminating tariffs on 90% of non-sensitive products within 5 years, while least developed countries have a 10-year timeline. The AfCFTA treaty also allows for the classification of certain goods as sensitive products and the exclusion of up to 3% of the tariff lines (and a maximum of 10% of the import value) from the trade liberalization process. The sensitive products clause grants countries more flexibility in the liberalization process for goods (7% of their tariff lines) that are critical to protecting domestic industries, ensuring food security, maintaining fiscal revenues, or safeguarding livelihoods.
Agriculture is traditionally among the most protected sectors and staple food products are considered essential for food security. Therefore, many agricultural goods are classified as sensitive products or are completely exempted from the trade liberalization process. It is important to note that the tariff offers of most State Parties are much more ambitious in terms of liberalization efforts than is necessary, given that exempting even a small proportion of goods from liberalization can preserve a large share of a country’s protection.
Challenging negotiations on Rules of Origin
The negotiations on the Rules of Origin (RoO) represent one of the most complex aspects of the AfCFTA implementation. The RoO regulations ensure that the product is produced in the exporting African country and establish local content requirements for value addition to the exported product within the exporting African country. 92.3% of tariff lines have been agreed upon except for vehicles, textiles, and clothing. Textile, clothing, and automobile are embedded in global value chains with only few African exporters, such as South Africa, Morocco (automobile) and Egypt, Morocco, and Ethiopia (clothing) and a large number of raw material producers. Stricter Rules of Origin protect African raw material exporters and impose restrictions on clothing and automobile producers. For instance, with stricter RoO, South Africa’s automobile industry will face higher sourcing costs because many components are imported from outside Africa and exporting the final product within Africa may not qualify for tariff-free trade within AfCFTA. Nigeria, as a raw material exporter, could benefit as producers are required to source more inputs from within Africa (instead of outside Africa), to access other African markets tariff-free.
Low trade integration, disruptive trade disputes
Today, around 15% of all African merchandized trade and 20% of all African food trade is within Africa (Fig 1), while the share for intra-African exports is higher than for intra-African imports. These numbers are higher than 20 years ago, but intra-African trade remains relatively low as compared to intra-regional trade in Europe, the Americas, and Asia where intra-regional trade is between 40 and 80%. Intra-African exports are concentrated among South Africa, Nigeria, Egypt, Angola, and Democratic Republic of Congo who account for 50% of intra-African exports.
Figure 1: Share of intra-African trade in total African trade (imports + exports)
Among agricultural products, sugar, palm oil, maize, and food preparations are the top traded products, which has changed from 20 years ago when cotton and coffee were among the top three traded food products. Intra-African agricultural trade is concentrated within the RECs with COMESA (Common Market for Eastern and Southern Africa ) and SADC (Southern African Development Community) accounting for the largest share of intra-REC trade (Fig 2). The great prospect of the AfCFTA liberalization process is that it accelerates inter-REC trade in Africa.
Figure 2: Share of extra and intra-Regional Economic Communities agricultural trade 2020–2022 average (current US$ millions)
Official intra-African trade statistics, especially for agricultural trade, need to be interpreted with cautiousness. Traditionally, a large share of cross-border trade is informal and unreported. For instance, the OECD Sahel and West Africa Club collected additional cross-border food trade data and estimates that intra-regional trade in West Africa is enough to meet the energy needs of 80 million people or a quarter of the region’s population for one year. Therefore, official statistics underestimate intra-African food trade.
Early evaluations of the GTI show that the AfCFTA can help to ease inter-REC trade and create new business relationships. However, the GTI was implemented mainly to test AfCFTA procedures and customs handling and not primarily to accelerate intra-African trade. The country-level experiences suggest that there are differences between the participating countries with some countries being able to establish a smooth customs process and promote new trade connections. On the other hand, alongside AfCFTA trade liberalization, governments continue to disrupt intra-African trade using export bans and import restrictions as a recent trade conflict between Tanzania, Malawi, and South Africa demonstrates. Therefore, only the coming years will tell if intra-African trade integration can move to the next level.
Reduction of food insecurity could take time
Simulation studies suggest that the AfCFTA could reduce food insecurity of 1 million people in Africa. These improvements represent long-term changes as a result of higher incomes from enhanced trade. The country-specific effects depend on the projected income gains in each country and who gains from trade liberalization and who loses. Food insecurity is projected to reduce if trade liberalization benefits incomes of the poorer population groups and will increase if trade liberalization increases inequality.
For Kenya and Tanzania, where rural food insecurity is higher than urban food insecurity, model simulations suggests that AfCFTA trade liberalization benefits rural and urban households but rural household over-proportionally. For the entire COMESA region, food insecurity is projected to uniformly decrease, but only at small rates around 0.2%. Exemptions are Tunisia, Eswathini, and Mauritius, where food insecurity could reduce by around 1%. For the Western African economies Ghana and Nigeria gains could be higher because both countries are projected to see increasing exports but also lower food prices.
Not captured by these models are additional long-term gains of trade integration from incentives for cross-border investment to create regional value chains, for instance, by investing in food processing industries, which can reduce post-harvest losses, extend shelf-life, and add nutritional value to basic commodities. Regional value chains and industrialization can create employment opportunities in the agri-food sector that also benefit farmers by reducing agricultural income risks.
However, these long-term food security gains may be substantially delayed if agricultural products are classified as sensitive or exempted products. In the short-term, trade liberalization can help address regional food imbalances, enhance supply chain resilience, and improve access to diverse, nutritious foods. Thus, the AfCFTA can enhance the stability of regional food systems, compared to autarkic approaches, and reduce the frequency and severity of food crises if markets remain open.
Reducing nontariff costs
The evidence on the likely effects of AfCFTA is clear. The AfCFTA's promise hinges not on tariff reductions alone, given that intra-REC tariffs are already minimal, but to a larger extent on reducing nontariff trade barriers and costs, stemming from inadequate infrastructure and trade bureaucracy. For example, the World Bank estimates that two thirds of the US$ 450 billion income gain rely on the reduction in nontariff barriers. Addressing these barriers is more important than tariffs and critical for the creation and development of value chains on the continent.
Average nontariff trade costs in Africa are equivalent to a tariff of around 300% making trade in and with Africa about 50% more expensive than the global average due to infrastructure gaps in transport, energy, and Information and Communication Technology In consequence, extra-African trade costs are often lower than trade costs within Africa impeding intra-African trade and the competitiveness of African producers also explaining Africa’s limited role in global value chains.
What makes trade in Africa so expensive? A lot can be attributed to infrastructure and trade bureaucracy. If there is no direct flight between Kampala and Accra, no railway from Dakar to Khartoum, and no all-weather road through the Democratic Republic of Congo connecting Rwanda and Cameroon, shipments are more expensive. Shipments are delayed at congested border crossings and ports with clearance times averaging three weeks in many sub-Saharan countries. But time is money. The longer the shipment takes, the larger the trade costs. Therefore, halving the time to trade could boost African exports by over 12% and African imports by 30%.
The AfCFTA agreement itself requires each country to draw up a time-bound plan to eliminate nontariff barriers, but progress has been slow. Effective reforms must prioritize cross-border infrastructure projects, digital permits, one-stop border posts, and harmonization of food quality and safety standards. The AfCFTA is well advised also to allow flexibility in the agreement to support implementation in countries with limited production capacity that fear greater competition and to make regulatory exemptions for low-value consignments in form of a simplified trade regime.
What’s next? What needs to be done?
The GTI was terminated in May 2025 at the 16th Council of Ministers Meeting in April 2025 with the conclusion by AU ministers that Africa is ready for the AfCFTA. The voices from the individual member countries are mixed. It can be expected that some countries may still need time to get the tariff concessions verified and to establish the necessary administrative structures, including customs procedures, to successfully participate in AfCFTA trading. The hope is that the successful implementation of AfCFTA procedures in some first-mover countries will showcase the benefits of AfCFTA trading to other countries and pave the way for its full implementation by all member states. Still, positive effects on food security may take time to materialize.
However, there remain other challenges. Nontariff trade costs in Africa impede intra-African, particularly inter-REC trade, much more than prevailing tariffs do. Therefore, large investments in infrastructure are necessary. This infrastructure needs to reduce the costs of intra-Africa transport, unlike much of the investments by global trade partners, like the US, China, and EU, that aimed to facilitate extra-African trade, i.e., transport to seaports. The second pillar is the facilitation of intra-African trade by reducing trade bureaucracy and the harmonization of trade standards at the AU-level, unlike improving infrastructure, trade facilitation does not need large investments. Last, the AfCFTA regulatory framework needs to be adjusted to find a flexible solution for low-value consignments and address current trade disruptions that undermine trade liberalization efforts.
