More than 70 percent of African CEOs believe intra-Africa trade will increase over the next 12 months, says a survey released on Thursday.
According to the Africa CEO Trade Survey 2020, unlike other regions of the world, intra-Africa trade remains very low at 15 percent, leaving more room for growth.
“The African Continental Free Trade Area (AfCFTA) could also act as a timely catalyst to boost intra-African trade,” says the survey conducted by the Pan-African Private Sector Trade and Investment Committee (PAFTRAC) and Afreximbank.
African CEOs note that AfCFTA creates conditions for scale and is set to enhance competitiveness and productivity which will accelerate the transformation of African economies for better integration into the global economy.
The report also notes that the African private sector remains upbeat about international trade with over 50 percent of CEOs believing global trade will increase over the next 12 months.
The findings show that although more than 80 percent of CEOs experience several difficulties in global and intra-African trading, they are still firm believers in the power of trade which has been the main driver of growth and technology transfers and also recognize trade has been very important for their business.
The analysis notes that more than 75 percent of African entrepreneurs have experienced difficulties in trading.
According to the survey, the key constraints for businesses include tariff and non-tariff barriers in international trade, lack of access to capital and foreign exchange, inadequate transport and logistical infrastructure, lack of transparency in rules and regulations, trade information gaps as well as asymmetry in state subsidies.
The report shows that despite all reservations, Africa CEOs are still very upbeat about multilateral trade systems.
The analysis indicates that over 50 percent of the African CEOs believe the multilateral trade system will strengthen in the coming years.
The analysis notes that as the world redefines multilateralism and the structures of global institutions and the rules that underpin global trade, cooperation and investment, Africa must ensure it has a strong voice in defining the new world agenda and its structures.