A Year of Opportunity for Africa
In what is sure to be a pivotal year in the effort to combat climate change, Africa can make significant progress toward a carbon-neutral economy. But to do so, African countries must eliminate barriers to trade and innovation, address institutional decay, and build on recent diplomatic breakthroughs.
WASHINGTON, DC – The past year has been challenging for Africa. After a hopeful 2021, during which the continent-wide GDP increased by nearly 7% and every region experienced real growth, the economy slowed in 2022 amid rising inflation, monetary tightening, and geopolitical tensions. But it was also a year when African countries were finally able to make their voices heard on the global stage. At the start of another critical year, with the continent’s GDP projected to increase at a relatively modest pace of 4.1%, governments can take several steps to boost economic activity and ensure a sustainable future.
For starters, policymakers must foster trade and investment through the African Continental Free Trade Area (AfCFTA). Under a fully implemented AfCFTA, Africa’s combined consumer and business spending is expected to reach $6.7 trillion by 2030 and $16.12 trillion by 2050, transforming value chains and potentially reducing poverty across the continent.
Eight countries – Cameroon, Egypt, Ghana, Kenya, Mauritius, Rwanda, Tanzania, and Tunisia – began trading under AfCFTA’s Guided Trade Initiative last year. To build on this momentum in 2023, policymakers must accelerate the implementation of the agreement’s next phases, improve intra-African coordination, and call attention to early successes. Moreover, eliminating non-tariff barriers by introducing reporting and monitoring mechanisms would reduce business costs and encourage countries to increase imports.
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