The African Continental Free Trade Area: a game-changer for the financial sector

GLOBAL intra-regional trade figures show Africa at roughly 16% a stark contrast to Europe (65%) and Asia (43%).

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The African Continental Free Trade Area (AfCFTA) aims to address this disparity by establishing a unified market. For banking and financial institutions considering investing in Africa’s future, this is a pivotal moment to engage in the continent's economic transformation.

The AfCFTA encompasses 54 countries and 1.3 billion people. By 2035, intra-African trade will exceed $140 billion (R2.5 trillion), representing 15% of the continent's exports. With full implementation, these exports could reach $952bn - a 29% increase. These aren't mere statistics; they represent real opportunities for businesses.

The AfCFTA investment protocol’s holistic approach requires abolishing tariffs, introducing regulatory conformity, open cross-border transactions, and protecting investments and intellectual property while ensuring investor obligations. Such an investment climate will facilitate the free flow of capital and attract Foreign Direct Investment (FDI).

Designed to use “Deep Trade Agreements” (DTAs) encompassing additional policy areas - free movement of goods, services, capital, people, and intellectual property - the vision aims for a broader and deeper economically integrated trade bloc.