AfCFTA implementation to unlock over $1tn manufacturing investments

• Intra-African trade to create 14 m jobs, earn $470bn income SOPURUCHI ONWUKA, Editor Efficient and coordinated implementation of the African Continental Free Trade Area could unlock nearly $1 trillion in manufacturing growth, generate an additional $470 billion in income and create about 14 million jobs across Africa within the... The post AfCFTA implementation to unlock over $1tn manufacturing investments appeared first on Champion Newspapers LTD.

News May 27, 2026 0 6 Add to Reading List

AfCFTA implementation to unlock over $1tn manufacturing investments

• Intra-African trade to create 14 m jobs, earn $470bn income

SOPURUCHI ONWUKA, Editor

Efficient and coordinated implementation of the African Continental Free Trade Area could unlock nearly $1 trillion in manufacturing growth, generate an additional $470 billion in income and create about 14 million jobs across Africa within the next decade, according to a new report released by the Mo Ibrahim Foundation.

The report said the continent stands on the threshold of a historic economic transformation if African governments fully activate the AfCFTA through harmonized policies, integrated infrastructure systems, freer movement of people and goods, and stronger cooperation among regional economic blocs.

According to the foundation, effective coordination among governments, regulators, financial institutions and regional bodies could raise intra-African trade from the current 18 percent to about 53 percent by 2035, transforming Africa into one of the world’s largest integrated economic markets with a combined population of nearly 1.5 billion people.

The report stressed that the economic gains from successful implementation would extend far beyond trade expansion, noting that deeper integration would stimulate industrialization, strengthen regional value chains, accelerate manufacturing growth, attract investments and reduce Africa’s dependence on exports of raw commodities.

It added that improved continental trade would support economic diversification, boost productivity, increase competitiveness of African industries and expand employment opportunities for the continent’s rapidly growing youth population.

The foundation explained that a fully operational AfCFTA could also strengthen food security, improve supply chain resilience and reduce the vulnerability of African economies to external shocks by encouraging greater local sourcing and intra-continental production networks.

According to the report, coordinated implementation would enable African countries to leverage their demographic strength, natural resource endowments and expanding consumer markets to build stronger domestic industries and retain more value within the continent.

The report was released at a period of rising tensions around xenophobic sentiments in South Africa and renewed debates over migration across the continent. The foundation warned that restrictive migration policies and weak regional cooperation could undermine the broader objectives of continental integration.

It therefore called for urgent measures to facilitate legal migration and labor mobility across African countries, arguing that freer movement of Africans would enhance skills transfer, entrepreneurship, innovation and labor market efficiency.

According to the report, more than 72 percent of migrants from sub-Saharan Africa seeking better economic and social opportunities remain within Africa, underscoring the importance of developing policies that support safe and productive intra-African migration.

However, despite the ambitions of the AfCFTA, the report identified several major trade and mobility barriers threatening effective implementation of the agreement.

One of the biggest obstacles, it noted, is the continued restriction on movement of people across the continent. Only four countries — Mali, Niger, Rwanda and São Tomé and Príncipe — have ratified the African Union’s 2018 Free Movement of Persons Protocol.

As a result, only about 28 percent of African citizens can travel to fellow African countries without visas, while limited recognition of academic qualifications and professional certifications continues to restrict labor mobility across borders.

The foundation also warned that non-tariff barriers remain a major threat to the success of the AfCFTA despite ongoing tariff reduction initiatives.

According to the report, trade across Africa continues to face disruptions from cumbersome customs procedures, excessive border checks, inconsistent product standards, sanitary and phytosanitary regulations, packaging and labelling requirements, and administrative bottlenecks that increase transaction costs and delay movement of goods.

Limited currency convertibility across African economies was also identified as a major structural challenge. The report estimated that Africa loses approximately $5 billion annually to currency conversion costs because many cross-border transactions still rely on external currencies.

The foundation noted that while the AfCFTA Secretariat and Regional Economic Communities are working to address these constraints, progress remains slow due to weak political commitment, fragmented regulations and uneven implementation among member states.

Beyond regulatory barriers, the report said inadequate infrastructure remains one of the most serious threats to continental integration.

Africa’s transport systems, it explained, were historically designed to move raw materials from inland production centers to ports for export outside the continent rather than to facilitate intra-African trade.

Consequently, transport connectivity within Africa remains fragmented, costly and inefficient. Road transport, which accounts for the bulk of movement of goods and people, is frequently hindered by poor road quality, insecurity, discontinuous networks and inadequate maintenance.

Rail transport systems across the continent also suffer from obsolete infrastructure, incompatible technical standards, high operating costs and limited interoperability between countries.

The report disclosed that at least 13 African countries, accounting for roughly 17 percent of the continent’s population, still lack direct rail connections to seaports, placing many landlocked economies at a major disadvantage in regional trade.

Air transport within Africa was described as underdeveloped and expensive, with most aviation routes still oriented toward Europe and other international destinations instead of linking African commercial centers directly.

The foundation further observed that Africa’s extensive inland waterways and river systems remain largely under-utilized despite their significant economic potential.

To overcome these barriers, the report called for massive investments in transport, logistics, energy and digital infrastructure capable of supporting integrated continental trade.

It urged African governments to prioritize development of cross-border highways, modern rail corridors, inland dry ports, seaports, regional power systems and broadband connectivity infrastructure.

The report also recommended harmonization of customs systems, digital trade platforms, product standards, taxation policies and payment systems to reduce delays and improve efficiency in cross-border transactions.

According to the foundation, stronger financial integration and wider adoption of regional payment systems would help reduce dependence on foreign currencies and lower transaction costs for African businesses.

The report emphasized the need for policy reforms that strengthen governance, improve regulatory transparency and encourage private sector participation in infrastructure development and industrial expansion.

It called for coordinated implementation frameworks involving African governments, regional institutions, development finance agencies and international partners to ensure that infrastructure investments align with the long-term objectives of continental integration.

The foundation acknowledged growing infrastructure investments by external partners including China through the Belt and Road Initiative and the European Union through its Global Gateway program.

However, it warned that many existing infrastructure projects still reinforce Africa’s traditional role as an exporter of raw materials instead of supporting integrated industrial value chains within the continent.

The report therefore stressed that future investments must focus on strengthening internal African connectivity, supporting industrialization and building climate-resilient infrastructure systems capable of withstanding extreme weather conditions and rising environmental risks.

Ultimately, the foundation concluded that the AfCFTA represents Africa’s most ambitious economic integration project in decades, but its success will depend on whether governments can move beyond declarations and implement coordinated policies capable of dismantling longstanding structural barriers to trade, mobility and industrial development across the continent.

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