AfCFTA: The key game-changer to boost Africa’s economic growth amid global turmoil

The African Continental Free Trade Agreement (AfCFTA) is the single most promising lever for the continent to drive growth and turn global conflict and an upended world trading order to its advantage.

Africa is forecast to become the world’s fastest growing economic region in 2026, and AfCFTA is central to building the continent’s resilience against global shocks, says Stellenbosch Business School guest lecturer in Corporate and Development Finance, Jason Hamilton.

“The AfCFTA isn’t a magic wand, but it is the single most promising lever for Africa’s economic future currently in play. As a South African thought leader recently put it, Africa’s story in 2026 is not about waiting for opportunity, but creating it. Intra-African trade is how we create that opportunity by ourselves, for ourselves,” he said.

Speaking as the continent commemorates Africa Day on 25 May, Hamilton said the wars in the Middle East and Ukraine positioned Africa to offer alternative trade routes, markets and investment opportunities.

AfCFTA, creating the world’s largest trading bloc, would also enable greater participation by African countries in the growing South–South trade between developing economies.

“In this turbulent climate, trade, finance and technology are increasingly wielded as strategic weapons, leaving smaller economies exposed to the fallout of decisions made in Washington, Brussels or Beijing.”

“AfCFTA provides a critical buffer as advanced economies turn inward and geopolitical blocs harden. Regional integration is our safety net. By trading more with our African peers, we become less beholden to the whims of distant powers.

“AfCFTA enables African countries to diversify their economic links, not by turning isolationist but by turning to their neighbours,” he added.

The agreement would enable Africa to capitalise on its economic story becoming one of ‘guarded optimism’, on the back of projections that the continent will outpace global average growth this year.

While growth in many developed economies is sluggish, African countries account for 12 of the 20 fastest growing world economies. The African Development Bank forecasts 4.3% growth in African economies in 2026, outpacing the global average of 2.6% forecast by the World Bank, and overtaking the Asian region as the world’s fastest growing economic region.

“Amid the global turmoil, major African economies have proven resilient, and hot spots in East and West Africa are even slated to grow above 6%. This ‘African resilience’ is no coincidence: It stems from years of structural reforms and a youthful dynamism across the continent,” Hamilton said.

He said the key drivers of Africa’s growth include strategic infrastructure development, rapid urbanisation, digital transformation, expanding regional markets and deeper integration into global value chains – all of which would be further enhanced by AfCFTA.

He noted that South–South trade was growing in importance for developing markets, as demand growth weakened in advanced economies and the Global North was beset with geopolitical conflicts stifling trade routes and markets. “Emerging market governments worldwide are doubling down on South–South co-operation, such as through AfCFTA and BRICS, specifically as a buffer against a fragmented global system.”

South–South trade has surged from $0.5 trillion in 1995 to $6.8 trillion in 2025, with 57% of developing country exports going to other developing economies, including more than half of Africa’s exports destined for developing markets.

AfCFTA has moved “from lofty rhetoric to real implementation” of its aim to progressively eliminate tariffs and reduce other barriers among 1.3 billion Africans, connecting a $3.4 trillion market, Hamilton said.

The United Nations Economic Commission for Africa has estimated that fully implementing the AfCFTA could lift 50 million Africans out of poverty by 2035 and boost intra-African trade by over 50%.

“It could spark new industrial value chains across borders, linking South African factories to consumers in West Africa, or Kenyan agri-businesses to markets in southern Africa. By harmonising regulations and standards, the AfCFTA also reduces the red tape that has long frustrated small businesses looking to expand beyond their home country. In short, it creates a continental platform for growth,” Hamilton remarked.

He said encouraging signs of progress were already evident.

Despite slowdowns in global trade, sub-Saharan Africa’s goods trade grew nearly 10% in value in the first half of 2025, and South African exports under AfCFTA preferences reached R820 million in 2025 in the pilot phase.

He said the “most exciting” aspect of AfCFTA implementation was the growing intersection of trade integration and technology. “The AfCFTA Digital Trade Protocol is aligning e-commerce rules, digital payments and data standards across Africa. This will create a continental digital economy projected to reach $180 billion this year.

“For entrepreneurs and tech startups, this means a seamless Africa-wide online market to scale up in. e-Commerce platforms in Johannesburg can sell to customers in Accra or Nairobi as easily as to those in Durban. Fintech apps can reach a user base of hundreds of millions, riding on Africa’s mobile money revolution.

“Digital trade, enabled by AfCFTA, could be a powerful equaliser: allowing small businesses and youth innovators to ‘go pan-African’ without the historic barriers of distance and disparate regulations.”