AfCFTA: Updated Analysis of Trade, Economic Outcomes, and Policy Implications
This study provides a comprehensive and updated analysis of the potential impacts of the African Continental Free Trade Area (AfCFTA). Utilizing the MAGNET model, based on GTAP version 7 and database version 11C, this research incorporates new information such as actual tariff offers, revised Non-Tariff Measure (NTM) modelling, and updated baseline projections to offer a more accurate assessment than previous studies.
The simulations indicate positive economic outcomes for Africa, including increases in GDP, household disposable income, and intra-African trade. While tariff reductions alone have a modest impact, the reduction of NTMs is crucial for achieving substantial benefits, with spillover effects to extra-African trade further amplifying these gains. The study also highlights that the AfCFTA is expected to foster industrialization in Africa, with manufacturing output showing the most significant increases among sectors.
However, the analysis also points to regional disparities in economic benefits and potential challenges such as a decrease in tariff revenues for some countries. The findings underscore the importance of complementary policies, effective NTM reduction, and strategic management of public revenue streams to ensure equitable and sustainable growth across the continent. Future research is suggested to explore the long-term social and environmental impacts, as well as the institutional and regulatory frameworks necessary for the agreement's full implementation.
SIMOLA Antti;
BOYSEN Ole;
NECHIFOR Victor;
FERRARI Emanuele;
2025-10-31
Publications Office of the European Union
JRC142657
978-92-68-29698-1 (online),
1831-9424 (online),
EUR 40385,
OP KJ-01-25-376-EN-N (online),
https://publications.jrc.ec.europa.eu/repository/handle/JRC142657,
10.2760/8604564 (online),
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