AfCFTA and the Impact of Covid19

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The African Continental Free Trade Area (AfCFTA) agreement is just over a year and a half since it entered into force (May 2019).  This was expected to be a milestone in enabling trade and free movement of people within the continent.  However, Covid19 seems a black swan that threw the policy makers into a spin in 2020 as number cases increased in Africa. 

We have previously highlighted that removing barriers to trade – movement of people, goods, and services, is a key catalyst for unlocking Africa’s potential.  AfCFTA is therefore a key instrument to unlocking this new era.  It is time for people across the continent to look around their neighbourhood countries and around the continent for new markets.  On the contrary, Covid19 led to the opposite direction as closed their borders, the concept of free movement was put on hold.  Case example was the Kenya – Tanzania border crossing, which had several interventions from senior government officials.

The overall effect shows the concept of free movement is still fragile across the region.  One the positive side, the continent has realised an inward look of its markets, with a number of local / cottage industries coming up.  The pandemic is also helping players in the transport and wider logistics sector to better plan their movement.  Marketers now have an opportunity to make an impact in not only developing their local markets but also have a regional reach.  With easier access to these markets, marketers have an opportunity to pursue better consumer understanding, develop regional trends and deepen market understanding at a wider level.

However, most important is the deepening in getting to nuances within the market.  It is time to get an understanding of previously uncovered details on Africa market.  Ease of access to these markets does not imply instant uptake of goods and services in the new markets.  At Episodes Research, we have worked with partners and clients across markets in the continent to help navigate such nuances.  There will still be the need to unearthing the factors that will make goods and services move from one market to another.  In other words, understanding consumer and business behaviours in different markets will still be a key factor to driving growth. While the policy and regulatory factors will no longer be a key hindrance, the need for go-to-market strategies will now be a priority in developing these new markets.

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