(ENA) African countries continue to trade more with the outside world than with each other, according to the findings of an assessment report by the Economic Commission for Africa (ECA) on progress made in regional integration in the context of the COVID-19 pandemic.
The report was presented at the 39th ECA Expert Committee of the Conference of African Ministers of Finance, Planning and Economic Development which opened in Addis Ababa on Wednesday.
The European Union, the report says, takes the largest share of the market, accounting for 29.8% of total trade in 2018.
The trend is however changing after Brexit and also due to increased trade between China and Africa.
Director of the Division of Regional Integration and Trade at ECA Stephen Karingi said COVID-19 had severely disrupted the implementation of regional integration initiatives, including the African Continental Free Trade Area ( ZLECAf), in particular trade by closing national borders.
“The implementation of regional integration continues to be hampered by the challenges of governance, peace and security,” he noted, adding that digitization is essential to maintain trade competitiveness and enable effective participation in cross-border e-commerce.
According to the report, Africa accounted for only 2.6% of world trade in 2018, a slight increase of 0.2% from 2017, while intra-African trade increased to 16.1% in 2018. (159.1 billion USD), compared to 15.5% in 2017.
While progress continues to be made in pursuing the continent’s regional integration agenda in the eight regional economic communities (RECs), challenges to achieving deeper integration remain, it has been learned.
Karingi pointed out that before the COVID-19 pandemic, there was an increase in intra-African trade in Africa, but compared to other regions, it has remained low.
“Trade, the economic movement of people and services, infrastructure, governance, peace and security are the main pillars of regional integration,” he noted, adding that many countries were doing a lot to implement ACFTA.
In addition, he said that productive integration was the least performing dimension of regional integration, added.
“Most of the communities are lagging behind in terms of intra-regional exports and intermediate imports, and register a very low index of complementarity of trade in goods.”