Can AfCFTA finally industrialise Africa?

By Richard Ndebele

For decades, Africa has exported its wealth largely in raw form — minerals, agricultural commodities and energy resources — only to import finished goods at far higher prices.

This pattern, deeply rooted in colonial economic structures, has long constrained the continent’s industrial development. Despite achieving political independence more than half a century ago, many African economies remain heavily dependent on commodity exports and vulnerable to fluctuations in global markets.

Today, however, Africa may be approaching a turning point.

At the centre of this shift is the African Continental Free Trade Area (AfCFTA) — the continent’s most ambitious economic integration project in a generation.

AfCFTA seeks to create a single African market connecting more than 1.3 billion people across 55 countries, with a combined GDP of about US$3.4 trillion. By scale alone, it is the largest free trade area in the world by number of participating states.

But its real significance goes far beyond tariff reduction.

The true promise of AfCFTA lies in its potential to support Africa’s long-delayed industrial transformation.

Historically, African trade patterns have been dominated by the export of primary commodities to external markets, while importing manufactured goods. As a result, intra-African trade has remained low — around 15% of total African trade, compared with roughly 60% in Asia and 70% in Europe.

AfCFTA seeks to reverse this imbalance by expanding trade within the continent — trade that typically contains a higher share of manufactured and value-added goods.

Recent trends suggest that momentum is beginning to build. In 2024, intra-African trade reached approximately US$208 billion, representing a 7.7% increase from the previous year, according to Afreximbank.

A larger continental market could enable African firms to produce at scale and develop regional value chains — where one country supplies raw materials, another processes intermediate inputs, and another manufactures finished products. Such production networks have been central to industrial growth in Asia and Europe but remain underdeveloped in Africa.

Importantly, the rise of AfCFTA coincides with a broader policy shift across the continent toward resource beneficiation and economic sovereignty.

Across Africa, governments are increasingly questioning the long-standing practice of exporting raw minerals without local processing.

Zimbabwe provides a clear example. The government has recently moved to restrict the export of raw minerals and lithium concentrate, with the aim of promoting domestic processing and retaining greater value within the country.

This reflects a growing recognition that Africa’s vast mineral wealth — including lithium, cobalt, platinum and rare earth elements — will play a central role in the global energy transition. Increasingly, African governments are seeking to ensure that these resources support local industrialisation rather than simply feed manufacturing sectors abroad.

AfCFTA could play a catalytic role in accelerating this shift by enabling the development of continental industrial ecosystems.

For Southern Africa, the opportunity is particularly significant. Countries within the region — including Zimbabwe, South Africa, Zambia and the Democratic Republic of Congo — possess substantial mineral reserves and industrial potential. If effectively coordinated, these resources could anchor regional manufacturing hubs in battery technology, metal processing and green energy supply chains.

Yet industrialisation is not only about minerals and factories.

Another often overlooked dimension of AfCFTA is the role of skills mobility and services trade. Industrial economies depend on the movement of expertise — engineers, technicians, logistics specialists, financial professionals and digital innovators — across borders.

AfCFTA’s protocols on trade in services, covering sectors such as finance, transport, communications and professional services, are therefore just as important as tariff reductions on goods. Greater mobility of skilled professionals could help close critical capacity gaps, stimulate knowledge transfer and support the growth of regional industrial ecosystems.

Equally important is infrastructure.

Industrialisation requires reliable energy supply, efficient transport corridors and modern logistics systems. Without these foundations, tariff reductions alone will have limited impact on trade flows.

Governance will also matter. Sound public financial management, transparent regulatory systems and strong institutions are essential to ensure that industrial investments deliver long-term economic benefits.

At the same time, AfCFTA presents an opportunity to embed environmental, social and governance (ESG) principles into Africa’s development model.

As new industrial corridors and mineral processing facilities emerge, policymakers have an opportunity to avoid the environmentally damaging pathways that characterised earlier industrial revolutions elsewhere. Responsible mining, transparent resource governance and fair labour practices will be critical if Africa is to position itself competitively within global supply chains.

Increasingly, global investors are demanding strong sustainability and governance standards. Aligning AfCFTA with ESG frameworks could therefore help Africa attract responsible investment while ensuring that industrial growth supports environmental stewardship and social inclusion.

Ultimately, AfCFTA represents far more than a trade agreement.

It is a strategic platform through which Africa can reshape its economic structure, deepen regional integration and build industries capable of competing globally.

For generations, Africa has been described as a continent rich in resources but limited in industrial capacity. The growing shift toward mineral beneficiation — combined with the opportunities created by AfCFTA — suggests that this narrative may finally be changing.

The real question now is whether African governments will seize this moment.

Africa can continue exporting its wealth in raw form while importing prosperity from elsewhere. Or it can use AfCFTA, its resources and its growing talent base to build industries that create jobs and drive sustainable growth.

History will judge AfCFTA not by the agreements signed in conference halls, but by whether it finally enables Africa to transform its natural wealth into lasting prosperity.

Richard Ndebele is Manager: Technical, Research and Quality Assurance at the Chartered Governance and Accountancy Institute in Zimbabwe (CGI Zimbabwe), and serves as Country Champion for the PAFA Sustainability Centre of Excellence. He writes on governance, sustainability and public financial management, with a focus on strengthening decision-making and institutional performance in African economies. Can be contacted on rndebele@cgizim.org