ADDIS ABABA, Aug. 28– Africa must urgently overhaul its fragmented trade model and establish integrated regional production networks to avoid economic marginalization and accelerate industrial growth, a report published on Friday suggested.
The report, entitled “Integrating Africa: From Threads to Hubs,” was co-launched by the African Union (AU), the United Nations Economic Commission for Africa, and the World Bank at the headquarters of the AU in Addis Ababa, the Ethiopian capital.
It highlighted that sub-Saharan Africa’s exports to the rest of the world are heavily concentrated in primary commodities, which are low in complexity, have limited domestic linkages, and are exposed to price volatility.
The structure of intra-African trade is characterized by higher-value products, stronger linkages, and greater potential for industrial deepening, according to the report.
It, however, stressed that the level of intra-African trade remains underdeveloped, accounting for just 15 to 17 percent of the continent’s total exports.
According to the report, most individual African nations are too small and geographically fragmented to achieve industrial scale independently.
It emphasized that regional integration is structurally necessary to expand market size, pool capabilities, and escape existing low-value, low-diversification capability traps.
The report indicated that Africa’s primary trade bottlenecks are regulatory fragmentation, with roughly 60 percent of total trade costs stemming from behind-the-border constraints, including customs clearance inefficiencies, sub-optimal logistics services, and poorly aligned domestic regulatory frameworks.
To overcome these barriers, the report recommended making economic systems fully interoperable across jurisdictions. It urged African governments to ensure that customs, digital data, financial payments, logistics, and institutional regulations can operate seamlessly across borders. (Namibia Daily News / Xinhua)
