Africa needs to find ways to better leverage its strengths, such as its young and growing population and its wealth of natural resources, to enable it to better offset the challenges presented by global headwinds.
As well as concerns about increasing trade restrictions and supply chain disruptions globally, Africa faces a raft of internal challenges and sluggish growth, said Hanan Morsy, Deputy Executive Secretary (Programs) and Chief Economist of the ECA at the opening session of the Expert’s segment of the 2025 Conference of Ministers of Finance.
But the Continent’s strengths, which include the opportunity to leapfrog over legacy challenges with technology, position it well to create sustainable and inclusive development. “Currently, progress in increasing intra-African trade relative to total trade has been limited at about 15.8%, substantially less than in other regions. But on the upside, the profile of trade within the continent is more positive than global trade, with a higher level of manufactured exports at 46% compared to 24% of value-added goods (2019-2023) as a percentage of trade with the rest of the world,” she said.
The latter remains rooted in commodities with just two product segments forming more than 52% of Africa’s total trade – fuel, as well as ore and metals.
She stressed that the profile of intra-African trade “tells us that there are huge opportunities to leverage trade among ourselves to create jobs with higher wages as we move up the value chain and create a better quality of growth.”
Ms. Morsy indicated that deeper integration, alongside greater industrialization, could produce many positive outcomes, such as increasing intra-African trade by 45%, the continent’s GDP by 1.2%, exports by 7.3% and imports by 6.9%. “Simply reducing restrictive regulations could lead to a 21.5% increase in intra-African digital trade,” she said.
She also said that another game changer in African development is the growth of pan-African payment systems which enable trade in local currencies and noted that despite only 6 countries currently utilizing cross border payments ,the system is estimated to have reduced $5 billion annually. “There is immense potential for expansion.
Ms. Morsy also stressed that African development finance institutions need to be well-capitalised to support trade. Delegates called for the eradication of non-tariff barriers, illegal trade practices and dumping and stressed the need for mainstreaming technology and strengthening capital markets.