Charting the path to African prosperity: Unravelling the economic dynamics of the African continental free trade agreement

Abstract

The African Continental Free Trade Area (AfCFTA) Agreement which came into effect in 2021 is a landmark Agreement that represents a  pivotal step towards economic integration and growth on the African continent. It was created to reduce tariffs on 97% of goods, unify  regulations, and make crossborder investment seamless. The projected effect is an increase in Africa’s trade earnings by up to $450 billion by 2035 and the rescue of 30 million Africans from extreme poverty. This paper explores the multifaceted dimensions of AFCFTA,  examining its historical context, institutional framework, and anticipated economic implications for participating nations. Through a  comprehensive analysis of the origin, evolution, and institutional and legal framework of AFCFTA, this study investigates the complex dynamics shaping the agreement. Utilizing a combination of policy analysis, case studies, and economic modeling, the research delves  into the status of implementation by state parties, negotiation phases, and the role of various stakeholders in the realization of AFCFTA's  objectives. The findings reveal insights into the challenges and opportunities inherent in AFCFTA, including the significance of rules of  origin, trade facilitation mechanisms, and the influence of political will and capacity on agreement outcomes. Additionally, the study  examines the potential benefits of leveraging experiences and knowledge from the European Union and the Global Gateway initiative. By  assessing the current status of AFCFTA implementation and identifying key challenges and risks, this research provides a roadmap for  navigating the complexities of the agreement. The paper concludes by offering recommendations for overcoming obstacles and  maximizing the transformative potential of AFCFTA to foster economic prosperity in Africa.Building on the findings of this study, future  research avenues could explore the long-term sustainability of AFCFTA, the social impact of trade liberalization, and innovative strategies   to enhance regional cooperation and economic development within the African continent.