Manufacturers Decry Poor Cross-Border Trade and Excessive Bottlenecks in Africa
The Director General of the Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadir, who also serves as Co-Secretary of the Pan-African Manufacturers Association (PAMA), has voiced significant concern regarding the persistent and costly barriers that manufacturers face when moving goods across African borders. He emphasized that despite Africa's substantial manufacturing and trade potential, these obstacles continue to frustrate efforts to boost intra-continental commerce.
Low Intra-African Trade Despite AfCFTA
Ajayi-Kadir lamented that even with the launch of the African Continental Free Trade Area (AfCFTA) in 2019, trade between African countries remains strikingly low, accounting for only 18 percent of the continent's total commerce. This figure pales in comparison to Europe's 60 percent, highlighting a severe constraint on the export of value-added manufactured products. He noted that this problem is not new but reflects deep-rooted structural weaknesses that have persisted for decades, long before AfCFTA was established.
Structural Weaknesses and Dependency
Pointing out that Africa's integration, built around eight regional economic communities, has yet to deliver seamless cross-border trade in manufactured goods, Ajayi-Kadir observed that many economies, including Nigeria, still export raw commodities rather than processing and exchanging value-added products internally. This outward orientation, he said, not only perpetuates dependency but also stifles the emergence of integrated regional industrial value chains that could drive sustainable trade across borders and demonstrate Africa's productivity as a major global exporter of manufactured products.
Challenges in Cross-Border Trade
"Unfortunately, trade across Africa remains complex, costly and operationally inefficient, despite decades of regional integration efforts and AfCFTA," Ajayi-Kadir stated. "While policy frameworks claim liberalisation, the lived reality for us continues to be shaped by a combination of structural, institutional and market constraints."
He identified several key challenges:
- High tariffs and non-tariff barriers, such as import bans, quotas, and inconsistent standards.
- Inefficient customs procedures and poor transport and logistics infrastructure.
- Limited regional connectivity, which increases transit times and reduces supply chain efficiency.
- High cost of trade finance and currency constraints, including volatility and limited convertibility.
- Weak implementation of regional agreements and prevalence of informal and illicit trade, encouraged by weak border enforcement and entrenched informal networks that divert trade from formal channels and erode government revenues.
Limited Development of Regional Value Chains
Ajayi-Kadir highlighted that Africa's limited development of regional value chains is a fundamental structural challenge. Unlike the European Union or Asia, where production is integrated across borders, African economies largely operate in isolation. This limits specialisation, reduces economies of scale, and weakens participation in global production networks.
Call for Transformative Policy Actions
Calling on governments, development institutions, and the private sector to remove these barriers and create an enabling environment for manufacturers to trade across borders, the PAMA chief recommended five transformative policy actions:
- Implementation of smart borders and digital trade systems.
- Creation of a predictable trade environment with the elimination of non-tariff barriers.
- Consistent AfCFTA enforcement and real-time monitoring mechanisms.
- Accessible trade finance options for manufacturers.
- Development of integrated and sustainable trade corridors and uniform cross-border industrial ecosystems.
These measures, he argued, are essential to unlocking Africa's manufacturing potential and fostering greater economic integration across the continent.
