Launched in 2021, the African Continental Free Trade Area (AfCFTA) is a game-changer for Africa’s economic future. With 54 signatories, 1.47 billion consumers, and a combined GDP of over US$3.4 trillion, AfCFTA is the largest free trade area in the world by number of countries.
For the agriculture and agribusiness sector, the implications are profound. Historically plagued by high tariffs, fragmented markets, and limited cross-border trade, African agriculture now stands on the edge of a transformation
Why AfCFTA Was Necessary for Agriculture
- Prior to AfCFTA, Africa’s agribusiness sector suffered from:
Tariffs as high as 35% between neighboring countries. - Overlapping trade blocs (COMESA, ECOWAS, SADC) that created regulatory confusion.
- Low intra-African trade, with only 12–17% of exports staying within the continent, compared to 69% in Europe and 59% in Asia.
This discouraged scale, reduced farmer incomes, and forced countries to import food—over US$50 billion annually, despite fertile land and abundant labor.
Early Impact of AfCFTA
Guided Trade Initiative (GTI)
Launched in 2022, GTI enables selected countries to begin real-time tariff-free trade under AfCFTA protocols.
By mid-2025:
– Over 30 countries are participating.
– Products like powdered milk, mushrooms, cereals, and fertilizer are moving across borders more efficiently.
– Ghana-Kenya fertilizer trade reduced delivery times by 50% and cut costs by 12%.
Intra-African Trade Growth
| Year | Share of Intra-African Trade |
| 2020 | 13.6% |
| 2023 | 14.9% |
| 2025 | 17% (projected) |
Key Opportunities for Agribusiness Under AfCFTA
Tariff Savings & Market Scale
90% of tariffs are being phased out.
Potential to add US$450 billion to continental income by 2035.
Increased Market Access for SMEs
44 million African SMEs many in agriculture can now trade beyond national borders.
Digital platforms like PAPSS ease cross-border transactions.
Boost in Agro-Processing & Value Addition
Rules of Origin encourage local production.
Intra-African agri-trade could rise by 574% by 2030.
Growth in Agribusiness Inputs
Demand for fertilizers, irrigation systems, cold storage, and transport is rising.
Fertilizer usage expected to increase by 800%.
Poverty Reduction & Inclusion
AfCFTA could lift 30 million people out of extreme poverty.
Women could see wage increases of over 10%.
Challenges That Still Remain
While AfCFTA presents great promise, several barriers must be addressed:
1. Non-Tariff Barriers (NTBs) – Customs delays, complex paperwork, and poor infrastructure still slow trade.
2. Standards and Certification – Most smallholders lack access to testing labs, quality certification, and cold chains.
3. Digital Divide – 80% of Africa’s 51 million farmers are smallholders with limited access to agritech tools or mobile platforms.
4. Government Revenue Loss – Countries like Kenya risk losing KSh 22.5 billion in tariff revenue.
What Agribusiness Could Look Like by 2030–2035
| Metric | Today | 2035 Projection |
| Intra-African agri-exports | US$38 billion | US$110+ billion |
| Africa’s total agri-market size | US$300 billion | US$1 trillion |
| Share of intra-African exports (all goods) | 12% | 21% |
| People lifted from poverty | — | 67.9 million |
Emerging trends
- Climate-smart farming (solar-powered cold chains, carbon-neutral crops).
- Digital agriculture & traceability (blockchain, mobile certification).
- Pan-African value chains (co-packaging, agro-industrial clusters).
Read more: Post harvest handling
Conclusion
The implications of AfCFTA for agribusiness are vast. From tariff-free trade and digital payments to inclusive growth and continental value chains, Africa’s farmers and entrepreneurs stand at the gateway of unprecedented opportunity.
While challenges remain standards, infrastructure, financing the policy foundations have been laid. The next decade will reward those who act early, innovate locally, and think continentally.
