Africa-Press – Eritrea. Africa’s reliance on external markets instead of promoting intra-Africa trade has shrank its economy and pushed up inflation, according to a new trade report.
The survey by the Pan African Trade and Investment Committee (PAFTRAC) projects that the continent’s GDP growth will shrink by 0.7 percent while inflation will rise by 2.2 per cent.
It attributes this to the Ukraine war which it says will will push more people into food insecurity and poverty.
This, at a time when the continent is still recovering from the effects of the Covid-19 pandemic which disrupted the global supply chain.
According to the survey Africa imports around $40 billion (Sh4.69 trillion) worth of food annually and the soaring wheat and sunflower prices in the wake of the Ukraine crisis threatens food security in the region.
The annual private sector survey was conducted in 46 countries and involved 800 respondents (CEOs).
The African Trade survey says that for the continent to turn the tide and build resilience it has to strengthen intra-African trade.
Out of the 600 respondents, 18.1 per cent were from Northern Africa, 10.5 per cent Southern Africa, 5.6 per cent Central Africa, 32.4 per cent East Africa and 33.4 per cent West Africa.
The report says that with 60 per cent of the world’s arable land, the opportunity exists for Africa to ensure food security through greater intra-African trade, as this will reduce reliance on food imports from outside the continent.
“With 60 per cent of the world’s arable land, the fastest growing population and an integrated market under the AfCFTA, the opportunity exists for Africa to ensure food security through greater intra-African trade,” it says.
The African Continental Free Trade Area (AfCFTA) creates a single continental market for goods and services, with free movement of businesspersons and investments.
“Survey clearly shows that the vast majority of African CEOs believe that the implementation of the AfCFTA will have a positive effect on levels of intra-African trade, even as early as 2022-23,” said Pat Utomi, chairman of PAFTRAC said.