Africa: Regional integration key to economic growth

Regional integration is key for Africa's development and economic growth. What strides have been made so far and what challenges still remain? CNBC Africa spoke to Stephen Karingi, the Director of regional integration and trade division at UNECA for more.

Thu, 23 Mar 2023 11:10:54 GMT

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AI Generated Summary

The potential economic benefits of the AFCFTA and the importance of effective implementation to boost intra-African trade and unlock additional trade value in key sectors such as agri-foods and manufactured goods.
The challenges hindering the full realization of the AFCFTA's benefits, including the need for improved infrastructure connectivity, free movement of people and goods, and greater regional cooperation on trade agreements.
The strategic importance of the pharmaceutical industry for Africa's economic growth, with initiatives aimed at enhancing local manufacturing capacity, vaccine production, and health security under the AFCFTA.

Africa's journey towards regional integration has been marked by progress in key areas such as trade agreements and infrastructure development. In a recent interview with CNBC Africa, Stephen Karingi, the Director of regional integration and trade division at UNECA, highlighted the potential economic benefits of the African Continental Free Trade Area (AFCFTA) and the challenges that still need to be addressed. Karingi emphasized the importance of implementing the AFCFTA effectively to boost intra-African trade by 35 percent by 2025 and unlock additional trade value in agri-foods and manufactured goods. However, he noted that the full realization of these benefits hinges on factors such as infrastructure connectivity and the free movement of people and goods across borders. Despite progress in policy frameworks, only four countries have ratified the free movement of people protocol, underscoring the need for greater regional cooperation. Karingi also pointed out the decline in infrastructure investments due to recent economic shocks, highlighting the imperative of mobilizing domestic resources to enhance infrastructure connectivity. Concerns about payment systems and currency volatility were also discussed, with Karingi stressing the importance of digitization and the Pan-African payment and settlement system to facilitate seamless trade transactions and mitigate currency risks. The pharmaceutical industry emerged as a strategic sector for Africa's economic growth, with initiatives underway to boost local manufacturing capacity and ensure health security through vaccine production. Karingi outlined plans to strengthen Africa's pharmaceutical sector under the AFCFTA, including the establishment of the African Medicines Agency and the implementation of competition policies and intellectual property rights protocols. Overall, Africa's regional integration efforts hold the key to unlocking the continent's economic growth potential and building resilient economies in the face of global challenges.