Truck drivers are vitally important to international commerce within Africa. They transport goods across hundreds of miles, often in extreme heat while contending with poor to nonexistent infrastructure in border regions, sluggish bureaucracy, corruption, and in some cases prowling lions along their routes. The establishment of the African Continental Free Trade Agreement (AfCFTA) in May 2019 intends to ameliorate many of these issues, but with more than a decade before its implementation it remains to be seen how the African Union will overcome the numerous challenges facing the 53 signatory countries of the free-trade agreement.
Cross-border tariffs will be significantly reduced or eliminated outright under the AfCFTA for 90 percent of African-produced goods, facilitating the free movement of goods and people across national borders. Under the new rules, larger industrialized countries like Kenya, Egypt, and South Africa will benefit in the short term, whereas smaller nations like Malawi, where 7.7 percent of its revenue comes from taxes on international trade and transactions, will lose out. Successfully implementing the AfCFTA will require foresight by African leaders and possible short-term sacrifices, which could prove difficult to encourage when faced with immediate concerns of elections and debt repayment.
Bearing in mind the economic imbalance between these larger and smaller countries, the AfCFTA may allow poorer countries a longer timeline to implement the trade regime’s rules, or institute a redistribution model to offset possible losses, like the European Union did with Greece and Portugal. Complicating this further are structural global market roadblocks. Raw materials like iron ore make up about half of the continent’s total exports, heading to destinations like China and the EU. “African countries don’t produce the goods that are demanded by consumers and businesses in other African countries,” said Trudi Hartzenberg, executive director of the Tralac Trade Law Centre in Stellenbosch, South Africa, to Bloomberg. There are also existing tensions between African countries regarding illicit trade and counterfeit goods, with countries like Nigeria closing down parts of its border to counter this.
Nonetheless, there remains optimism for the AfCFTA. The trade agreement’s purpose is to harmonize and simplify existing regulations, which means it will work in tandem with existing economic regional blocs like the Economic Community of West African States, eventually consolidating them under the wider continental arrangement. The African Export-Import Bank estimates that trade between African countries could grow as fast as 52 percent in the first year of the AfCFTA’s implementation.
If the AfCFTA and African Union can curtail some of the red tape and improve transnational roads, which carries about 80 percent of intra-African trade, the continent will be all the better for it.