Intra-African Trade Hurdles Persist as Manufacturers Face Import Pressure

The Gap Between Policy and Practice

The promise of the African Continental Free Trade Area (AfCFTA) to revolutionize the continent’s industrial landscape remains a work in progress. While policy attention has intensified, the reality on the ground is that African countries still trade significantly more with the rest of the world than they do with each other. Intra-African trade accounted for just 14.4% of total trade between 2022 and 2024, a stark contrast to the 60% seen in Asia and 57% in Europe. This structural imbalance remains the single greatest barrier to the continent’s industrial transformation.

The Threat of Cheap Imports

For local manufacturers, the challenge is twofold: they must navigate the difficulties of regional trade while simultaneously defending their market share against a flood of cheap imports. Industry leaders, such as those represented by the manufacturing associations in East and West Africa, have repeatedly warned that products from India and China are undercutting local producers. Without robust protectionist measures or a significant increase in regional competitiveness, many nascent industries risk being stifled before they can achieve the economies of scale necessary to compete globally.

The Role of Value Addition

The path forward, according to analysts, lies in moving up the value chain. The blueprint established by industrial giants like Aliko Dangote, who has focused on large-scale, integrated manufacturing, is increasingly being applied to the continent’s critical minerals. By processing cobalt, lithium, and graphite domestically, African nations hope to capture a larger share of the value generated by the green energy transition. However, this requires more than just policy; it demands massive investment in energy, transport, and logistics infrastructure, which remains unevenly distributed across the continent.

Risks and Opportunities

The current environment presents a mix of risk and opportunity for operators. While the geopolitical climate has made global supply chains more volatile, it has also created an opening for Africa to become a more attractive manufacturing destination. Investors who can navigate the complexities of the local business environment and tap into the growing regional market stand to gain. However, the risk of policy inconsistency and the slow pace of infrastructure development cannot be ignored. The next few years will be critical in determining whether the AfCFTA can truly catalyze a shift toward broader industrial development or if the continent will remain trapped in a cycle of raw material dependency.