The African Continental Free Trade Area (AfCFTA) has the potential to raise real incomes by 7–9% and lift 40 million people out of extreme poverty by 2035, the World Bank has stated.
The AfCFTA is a trade agreement among African Union (AU) member states, launched in January 2021, aimed at creating a single continental market for goods and services.
However, according to the World Bank’s April 2026 Africa Economic Update, the impact of the AfCFTA has yet to materialise.
The report noted that successfully leveraging the trade agreement to boost investment and commerce will require frontrunner countries to lead implementation, robust monitoring, and enforcement of commitments, and investment in regional public goods.
“While tariff reductions under the AfCFTA will help intraregional trade, the most significant constraints stem from internal trade costs,” the report said.
These, the report added, include inadequate transport and logistics infrastructure, inefficient customs and regulatory systems, limited digitalisation, and high domestic finance and logistics expenses.
Non-tariff barriers, including selective export bans, also remain common across the region.
The World Bank also stated that Phase II of the agreement should focus on investment, intellectual property, competition policy, and the inclusion of women and youth in trade, aiming to address these internal costs.
However, the World Bank cautioned that implementation is likely to be gradual due to substantial investment requirements and the need for deeper institutional and regulatory reforms.
