Trading Up: Harnessing the AfCFTA for Growth in Uganda

Submitted by on Thu, 05/05/2022 - 16:25

AfCFTA is one of the flagship projects of the first ten-year implementation plan (2014-2023) under the AU’s Agenda 2063. It emphasises the reduction of tariffs and non-tariff barriers, and the facilitation of free movement of people and labour, right of residence, right of establishment and investment. If implemented fully, this agreement will become the largest trade agreement in the world with potential to create a continental free-trade zone with a combined GDP of USD $3.4 trillion.

Uganda’s exports are highly regionalised, with more than half of all exports of goods remaining on the continent. Within Africa, much of Uganda’s exports are concentrated within the EAC (40% of total exports in 2018) and COMESA (8%) where FTAs already exist.

The AfCFTA will increase competition for Ugandan exports to the EAC, which are currently protected by high Common External Tariff (CET) rates. To maximise gains from the AfCFTA, Uganda should push for the establishment of regional institutions and processes that reduce the cost of intra-regional trade.