Deepening Regional Economic Integration in Africa

Historical evidence suggests that the AfCFTA has the largest free trade area in the world by number of participating countries, yet Africa remains significantly less regionally integrated than Europe, Asia, and the Americas. On this note, this paper argues that the observed integration deficit in Africa may have stemmed from the failure of the trade, financial, infrastructural, digital, and institutional systems that support economic activity to operate seamlessly across borders. It further argues that well-coordinated regional policies and digital financial integration represent some of the viable mechanisms through which trade, infrastructure, fintech, and cross-border payments can be interconnected. Moreover, consistent with this argument, evidence suggests that both digital adoption and financial inclusion have expanded in Africa, but infrastructure gaps, payment fragmentation, and regulatory divergence continue to constrain economic integration of the continent. Similarly, the empirical findings also support this argument by showing that stronger digital ecosystems are associated with higher regional integration in Africa

This was authored by: 
Chuwuka Onyekwena Ph.D, Jamilu Iliyasu Ph.D, Anthony Bisong, Emmanuel Nwosu Ph.D