The African Continental Free Trade Area (AfCFTA) was launched on 1 January 2021. This creates the largest free trade area in the world measured by the number of countries participating. It connects 1.3 billion people across 55 African countries with a combined gross domestic product (GDP) valued at $3.4 trillion. The AfCFTA is an opportunity for companies operating within the free trade area as they may export products to other countries within the Free Trade Area with tariffs and trade barriers that are partially or fully abolished.
The AfCFTA will not replace Africa’s existing free trade agreements, with the treaty deeming the existing Regional Economic Communities as “building blocks” for the AfCFTA. The secret to successful trade with African countries lies in harmonising the different existing frameworks that have been put in place. The spaghetti bowl concept is a popular topic when it comes to intra-African trade and refers to the continent's overlapping trade agreements. The AfCFTA brings a new dynamic and offers a fantastic opportunity for countries to expedite trade discussions inside Africa. Dealing with the spaghetti bowl effect may just be one of the necessary steps that have to be taken by Swiss exporters to take advantage of Africa’s growing business opportunities.
