Afreximbank launches its African Trade Report 2025 - Economy

Al-Ahram Weekly

14 hours ago

The African Export-Import Bank (Afreximbank) launched its flagship African Trade Report 2025, themed 'African Trade in a Changing Global Financial Architecture,' on Thursday during the Afreximbank Annual Meetings (AAM2025) in Abuja.
The report examines Africa's trade performance in a challenging global environment characterized by rising geopolitical tensions, new trade barriers, and financial uncertainty.
It also analyses how the continent could leverage these challenges into opportunities to enhance its resilience and navigate the evolving landscape.
'This year's report provides a compelling roadmap for Africa to reposition itself in a volatile global economy. From strengthening trade finance systems to accelerating the AfCFTA, the message is clear: Africa must turn global fragmentation into an opportunity for industrialisation, digital progress, and greater control over its financial systems,' Professor Benedict Oramah, the president and chairman of the Afreximbank Board of Directors, said.
Dr. Yemi Kale, Afreximbank's group chief economist and managing director of research, noted that despite global headwinds, Africa's trade rebounded strongly in 2023. Trade between African countries grew by 12.4 percent to reach $220.3 billion, from a contraction of 5.9 percent in 2023.
"This shows the tangible benefits of AfCFTA implementation, even as the continent contends with rising inflation, sovereign debt risks, and a persistent trade finance gap,' he added.
The report also indicates that Africa's total merchandise trade rebounded, increasing by 13.9 percent in 2024 to $1.5 trillion, following a 5.4 percent contraction in 2023.
However, Africa still makes up only 3.3 percent of global exports. This provides a clear signal that the continent must do more by moving away from commodity exports and accelerating its industrialization process if it is to enhance its integration into global value chains and boost intra-African trade.
It also requires better access to trade finance to bridge the estimated $100 billion gap.
While the global economy, which slowed to 3.3 percent growth in 2024, is expected to decline further in 2025, Africa's growth held steady.
The continent's economy grew by 3.2 percent, supported by strong commodity prices and better public finances. Still, growth remains uneven across the continent.
Moreover, Afreximbank's report emphasizes the importance of advancing the African Continental Free Trade Area (AfCFTA), which is becoming a foundation for trade resilience across the region.
It also highlights the expanding use of the Pan-African Payment and Settlement System (PAPSS), which is helping to reduce reliance on foreign currencies and making cross-border trade more efficient.
Furthermore, the report provides practical guidance on harmonizing trade rules and regulations across countries, unlocking investment from African institutions such as pension funds and sovereign funds, and utilizing Africa's new representation in the G20 to advocate for overdue global reforms.
This includes ensuring a fairer share of global financial resources, such as Special Drawing Rights, an international reserve currency created by the IMF, and increasing access to climate finance.
It also calls for adjustments in credit ratings to more accurately reflect the strength and potential of African economies.
Additionally, it highlights the growing significance of the Alliance of African Multilateral Financial Institutions (AAMFI), as it increases funding for development and helps rebuild a financial ecosystem that works better for Africans.
In 2024, Afreximbank alone disbursed more than $17.5 billion in trade finance. It plans to increase that amount to $40 billion by 2026.
As Africa faces a rapidly changing global environment, the report offers more than just analysis. It provides a transparent and practical plan for building a stronger, fairer, and more resilient African economy, driven from within the continent.
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