Afreximbank highlights role of intra-regional trade in Africa’s economic resilience
Active participation in intra-African trade has made it possible for a number of African countries to maintain resilient trade figures in the midst of falling commodity prices that have led to an overall sluggish economic growth story on the continent, Dr. Benedict Oramah, President of the African Export-Import Bank (Afreximbank), said yesterday.
Speaking in Addis Ababa during the opening of the Africa Trade Facilitation Forum, organized by the African Union and the United Nations Economic Commission for Africa, Dr. Oramah said that a distinguishing feature of countries like Cote d’Ivoire, Ethiopia, Senegal, Rwanda, Morocco and Kenya, whose economies had been growing at blistering paces, was their greater participation in intra-African trade.
“That is the case with Kenya and Cote d’Ivoire where the intra-regional trade share of their respective total trade is 40 per cent and 32 per cent respectively,” he said, adding that intra-African trade “has enabled the Kenyan shilling to remain reasonably stable when many others have been badly battered”.
Intra-African trade had proven to be a buffer to external shocks and an instrument for structural transformation of commodity dependent African economies, added the President. That confirmed the widely acknowledged view that regions that traded more with themselves were more industrialised and did better economically.
He said that while Africa’s total trade in 2016 was expected to remain subdued, intra-African trade was expected to bounce back strongly to reach an estimated $180 billion, the same level attained in 2013, pushing its share of African trade to a new high of 19 per cent.
The President announced that Afreximbank had introduced an Intra-African Trade Initiative under which it had committed to working with others to achieve more than 50 per cent growth in intra-African trade by raising the value from $170 billion in 2013 to $240 billion by 2021, increasing the intra-African trade share of Africa’s total trade by 22 per cent.
The Bank was also aiming to formalize no less than 40 per cent of Africa’s informal cross-border trade, he added.
Dr. Oramah highlighted the importance of facilitation and advocacy in accelerating intra-African trade, saying that there was need to resolve such issues as free movement of Africans across borders, multiplicity of standards across the continent, and adherence by parties to the spirit and intent of treaties they had signed on to.
The Africa Trade Facilitation Forum, organized as part of Africa Trade Week 2016 holding from 26 November to 2 December, sought to provide a platform for policy dialogue among Africa’s trade constituencies.
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