Wole Odeleye

A look at the potential benefits of the digital platforms for the AfCFTA and the African SMEs and consumers

The African Continental Free Trade Area (AfCFTA) is a landmark agreement that aims to create a single market for goods and services in Africa, covering 1.3 billion people and a combined GDP of $3.4 trillion. The AfCFTA is expected to increase intra-African trade by 52% by 2022, create millions of jobs, and foster regional integration and development. However, to realize the full potential of the AfCFTA, there is a need to address the challenges and barriers that hinder trade and financial inclusion in the continent, such as high transaction costs, lack of infrastructure, regulatory fragmentation, and low digital penetration.

That is why the SmartAFCFTA Platform and the Africa Trade Gateway are two innovative initiatives that aim to leverage the power of digital technology to facilitate and accelerate the implementation of the AfCFTA. The SmartAFCFTA Platform is a digital trade and open finance platform that will provide a range of services and solutions for the SMEs and consumers in the AfCFTA, such as digital wallets, payment gateways, lending platforms, insurance, remittances, and e-commerce. The Africa Trade Gateway is a digital trade facilitation platform that will enable seamless and secure cross-border transactions and market access for the AfCFTA, by providing a single window for trade information, documentation, verification, and compliance. Together, these two platforms will create a digital ecosystem that will enhance the financial and economic inclusion, competitiveness, and empowerment of the African SMEs and consumers, as well as foster regional integration and cooperation.

How the SmartAFCFTA Platform and the Africa Trade Gateway can benefit the largest economies in each of the geographic regions of Africa

The SmartAFCFTA Platform and the Africa Trade Gateway can offer significant opportunities for the largest economies in each of the geographic regions of Africa, by enabling them to tap into the potential of the AfCFTA and the digital economy. Here are some examples of how these platforms can impact the key sectors and industries of these economies:

• North Africa: Egypt. Egypt is the third-largest economy in Africa, with a GDP of $361.9 billion in 2019. It is also the most populous country in the region, with a population of 102 million. Egypt’s main exports are petroleum products, chemicals, textiles, and agricultural products. Egypt can benefit from the SmartAFCFTA Platform and the Africa Trade Gateway by expanding its market access and diversifying its export destinations, especially in the sub-Saharan region, where it currently has a low share of trade. The platforms can also help Egypt to improve its digital infrastructure and connectivity, which are essential for enhancing its competitiveness and productivity in the digital era. Moreover, the platforms can provide Egypt’s SMEs and consumers with access to a variety of financial products and services, such as digital wallets, payment gateways, lending platforms, insurance, remittances, and e-commerce, which can increase their financial inclusion and empowerment.
• West Africa: Nigeria. Nigeria is the largest economy in Africa, with a GDP of $448.1 billion in 2019. It is also the most populous country in the continent, with a population of 206 million. Nigeria’s main exports are crude oil, petroleum products, cocoa, and rubber. Nigeria can benefit from the SmartAFCFTA Platform and the Africa Trade Gateway by reducing its dependence on oil and diversifying its economy, by exploring new opportunities in the non-oil sectors, such as agriculture, manufacturing, and services. The platforms can also help Nigeria to overcome the challenges of inadequate infrastructure, high transaction costs, and regulatory uncertainty, which hamper its trade and investment potential. Furthermore, the platforms can provide Nigeria’s SMEs and consumers with access to a range of digital and financial solutions, such as digital wallets, payment gateways, lending platforms, insurance, remittances, and e-commerce, which can enhance their financial and economic inclusion and empowerment.
• Central Africa: Angola. Angola is the fifth-largest economy in Africa, with a GDP of $94.6 billion in 2019. It is also the second-most populous country in the region, with a population of 32.9 million. Angola’s main exports are crude oil, diamonds, and minerals. Angola can benefit from the SmartAFCFTA Platform and the Africa Trade Gateway by increasing its trade and investment diversification and integration, by accessing new markets and partners in the continent, especially in the non-oil sectors, such as agriculture, manufacturing, and services. The platforms can also help Angola to improve its trade and financial infrastructure and connectivity, which are crucial for enhancing its competitiveness and efficiency in the digital era. Moreover, the platforms can provide Angola’s SMEs and consumers with access to a variety of digital and financial services and solutions, such as digital wallets, payment gateways, lending platforms, insurance, remittances, and e-commerce, which can increase their financial and economic inclusion and empowerment.
• East Africa: Ethiopia. Ethiopia is the ninth-largest economy in Africa, with a GDP of $96.1 billion in 2019. It is also the second-most populous country in the continent, with a population of 115 million. Ethiopia’s main exports are coffee, oilseeds, flowers, and textiles. Ethiopia can benefit from the SmartAFCFTA Platform and the Africa Trade Gateway by boosting its trade and investment growth and integration, by accessing new markets and partners in the continent, especially in the high-value sectors, such as manufacturing, services, and digital. The platforms can also help Ethiopia to enhance its trade and financial infrastructure and connectivity, which are vital for improving its competitiveness and productivity in the digital era. Furthermore, the platforms can provide Ethiopia’s SMEs and consumers with access to a range of digital and financial products and services, such as digital wallets, payment gateways, lending platforms, insurance, remittances, and e-commerce, which can enhance their financial and economic inclusion and empowerment.
• Southern Africa: South Africa. South Africa is the second-largest economy in Africa, with a GDP of $351.4 billion in 2019. It is also the most developed and diversified economy in the region, with a population of 59.6 million. South Africa’s main exports are gold, diamonds, platinum, machinery, and vehicles. South Africa can benefit from the SmartAFCFTA Platform and the Africa Trade Gateway by increasing its trade and investment innovation and integration, by accessing new markets and partners in the continent, especially in the emerging sectors, such as digital, green, and creative. The platforms can also help South Africa to leverage its advanced digital and financial infrastructure and connectivity, which are key for enhancing its competitiveness and efficiency in the digital era. Moreover, the platforms can provide South Africa’s SMEs and consumers with access to a variety of digital and financial solutions and services, such as digital wallets, payment gateways, lending platforms, insurance, remittances, and e-commerce, which can enhance their financial and economic inclusion and empowerment.

Conclusion

The SmartAFCFTA Platform and the Africa Trade Gateway are two innovative digital platforms that aim to facilitate and accelerate the implementation of the AfCFTA, by providing a range of services and solutions for the SMEs and consumers in the AfCFTA, such as digital trade and open finance. The platforms can offer significant opportunities for the largest economies in each of the geographic regions of Africa, by enabling them to tap into the potential of the AfCFTA and the digital economy, and by enhancing their financial and economic inclusion, competitiveness, and empowerment. The platforms can also foster regional integration and cooperation, by enabling seamless and secure cross-border transactions and market access for the AfCFTA. The SmartAFCFTA Platform and the Africa Trade Gateway are therefore key enablers for achieving the vision of the AfCFTA, which is to create a prosperous, integrated, and resilient Africa.