As geopolitical tensions and economic nationalism reshape international trade, African leaders are moving with renewed urgency to strengthen intra-continental commerce. The continent is confronting a stark reality: external markets are becoming increasingly volatile, protectionist and unpredictable. Against this backdrop, African policymakers are deepening their focus on regional integration, seeking to insulate economies from global shocks and assert economic agency.
At the centre of this effort lies the African Continental Free Trade Area (AfCFTA), a trade pact conceived to unify 1.4 billion people across 55 African Union member states into a single market. Ratified by 49 countries and operational since 2021, AfCFTA aims to boost trade, industrialisation, and economic resilience by lowering tariffs, eliminating non-tariff barriers, and fostering common standards. The theoretical potential is substantial: the continent’s collective GDP stands at approximately $3 trillion, comparable to France’s economy, a G7 nation.
Despite these ambitions, practical implementation has been uneven. Only 24 member states are currently trading under the AfCFTA framework, highlighting significant execution gaps. Persistent barriers—ranging from infrastructural deficits and governance inconsistencies to currency volatility and informal trade—continue to inhibit progress.
The push to accelerate AfCFTA’s activation is, in part, a reaction to rising global tariff regimes. In particular, the re-election of U.S. President Donald Trump in early 2025 has reignited fears of economic nationalism. His administration’s reintroduction of punitive tariffs—such as those affecting Lesotho’s exports with rates reaching up to 50%—has had a chilling effect across African industries, threatening job losses and revenue contraction. Speaking to Reuters, AfCFTA Secretary-General Wamkele Mene described the situation as “unprecedented,” citing the “weaponisation of trade and investment policy” and its corrosive effect on multilateralism.
Indeed, the multilateral trade order that many African economies have relied upon for decades appears increasingly unstable. With global supply chains disrupted by protectionist manoeuvres and nationalist policies, African nations are turning inwards to establish regional supply chains and reduce reliance on external partners. “The lesson to observe,” Mene remarked, “is that we are on our own as a continent.”
While AfCFTA’s theoretical benefits are considerable, realising them requires overcoming formidable structural challenges. According to the World Bank, fully implemented, the agreement could increase intra-African exports by 81% by 2035. However, progress has been slow. In 2023, intra-African trade rose by 12.4% to $208 billion, according to Afreximbank. While encouraging, these gains are still modest compared to potential.
A key impediment is the continent’s longstanding infrastructure gap. The African Development Bank (AfDB) and Afreximbank have collectively invested $65 billion in infrastructure since 2020, but this barely addresses the $100 billion annual shortfall in required investment. Roads, bridges, railway networks, and digital connectivity remain patchy, particularly in landlocked and low-income economies. Standard Bank CEO Bill Blackie, speaking from Johannesburg, warned that “without hardened bridges and faster rail links, AfCFTA will remain a paper promise.”
This sentiment is echoed across the continent. Raheema Parker of Oxford Economics observed that the weaknesses are especially pronounced in smaller sub-Saharan economies, many of which remain highly vulnerable to external shocks and suffer from limited administrative capacity. Governance inconsistencies further complicate implementation. Informal cross-border trade—though economically vital to many communities—often exists outside regulatory systems, making standardisation and enforcement difficult.
Currency also poses a substantial challenge. Nearly two-thirds of payments across the continent are routed through U.S. dollar corridors, exposing countries to volatility and additional transaction costs. In response, Afreximbank has called for a strategic shift away from dollar dependency. Group chief economist Yemi Kale stated that “local-currency corridors must become the norm to slash costs and tame volatility.”
To this end, the recently launched Pan-African Payments and Settlement System (PAPSS) links 16 central banks across the continent, enabling real-time payments in local currencies. By cutting reliance on foreign currencies for intra-African transactions, PAPSS aims to streamline commerce, reduce transfer fees, and support the financial sovereignty of participating states.
Yet, the journey toward economic self-reliance remains fraught. Despite the shared vision among African leaders, operational challenges persist. Border inefficiencies, complex paperwork, and regulatory fragmentation continue to stymie trade flows. Former Chadian finance minister Abbas Mahamat Tolli underscored the need to “diminish all the commercial barriers” that continue to obstruct the free movement of goods and services.
Still, there are signs of cautious optimism. The G20 finance ministers’ summit held in Durban this week—hosted under South Africa’s G20 presidency—placed trade resilience and regional integration high on the agenda. Policymakers from across the globe discussed how to support African-led initiatives and foster global cooperation in a fragmenting economic order.
Ultimately, AfCFTA’s transformative potential hinges on more than signatures and declarations. Its success will depend on decisive national leadership, infrastructure investment, cross-border trust, and the political will to confront entrenched inefficiencies. As the global trade environment becomes more insular, African unity—economically and politically—may become not just a strategic aspiration but a survival imperative.
