AfCFTA at five — what has moved, and what is still mostly paperwork

<p>The African Continental Free Trade Area entered force on 1 January 2021. The launch narrative — a single market of 1.3 billion people, $3.4 trillion in combined GDP, the world&#x27;s largest free-trade area by participating-state count — was the easy part. The harder part has been operationalisation, and at the five-year mark the honest assessment is mixed.</p> <p>What has moved. The Pan-African Payment and Settlement System (PAPSS), operated by Afreximbank, has 14 commercial banks across 11 countries live by May 2026. Settlement in local currencies bypasses the dollar correspondent banking layer for the first time at meaningful scale. Volumes remain small relative to the latent demand, but the infrastructure is real, and the unit economics improve as adoption grows. AfCFTA Guided Trade Initiative shipments — Ghana, Kenya, Rwanda, Tanzania, Egypt, Cameroon — moved nine product categories under preferential tariffs in the 2022-2024 pilot, establishing the rules-of-origin precedents the next phase needs.</p> <p>What hasn&#x27;t. The protocol on services has not been ratified by enough states to operationalise. Free movement of professionals is a stated AU goal that intra-African visa regimes still largely contradict. Tariff schedules are being negotiated bilaterally in many corridors, undercutting the multilateral framework the AfCFTA is supposed to establish. The Nigerian-South African trade relationship — the two-largest African economies — remains structurally underbuilt, with bureaucratic and currency frictions that AfCFTA has not yet dissolved.</p> <p>The deeper structural issue is the asymmetry the AfCFTA does not address. South Africa&#x27;s manufacturing base, Morocco&#x27;s automotive sector, and Egypt&#x27;s industrial capacity are qualitatively different from the productive capacity of the Sahel, Central, or East African economies. Free trade in this context tends to concentrate industrial production in the existing nodes and to deindustrialise the periphery — the same pattern that the EU&#x27;s enlargement to Central and Eastern Europe produced before structural funds compensated for it. The AfCFTA has no structural-funds equivalent. The negotiations on industrial development under AfCFTA Phase II have stalled.</p> <p>The five-year assessment is, then: payment and customs infrastructure is being built, tariff liberalisation is happening unevenly, and the question of how to share the industrial-policy gains is unresolved. That last question — not the tariff schedule or the rules of origin — is the one that will determine whether AfCFTA is a transformation or a treaty most Africans live next to without benefiting from.</p>