The World Trade Organisation (WTO) has projected that Africa could become the world’s fourth-largest economy by 2050 if it fully harnesses its demographic strength, natural resources, and trade potential.
WTO Director-General Ngozi Okonjo-Iweala highlighted the continent’s vast opportunities but noted that intra-African trade remains significantly more expensive than trade with other regions.
“It costs 20 per cent more for us to trade with each other on the continent than with others externally,” she said.
Okonjo-Iweala attributed this gap to factors such as poor infrastructure, inefficient border systems, and high logistics and transport costs, which continue to impede regional trade growth.
Despite these barriers, she expressed optimism about Africa’s economic prospects, pointing to its abundant resources and young, dynamic population as key drivers for long-term growth.
“The African continent has a lot of resources and a lot of things going for it. But there are also many challenges,” she said.
According to WTO data, only 18 per cent of Africa’s exports remain within the continent, compared to 60 per cent in Asia and 70 per cent in Europe. She described this imbalance as “unsustainable if Africa hopes to reach its full economic potential.”
She also noted that small and medium-sized enterprises are the most affected by high trade costs, as they often find it cheaper to export outside the continent than to neighbouring African countries.
The African Continental Free Trade Area (AfCFTA), launched in 2021 to create a unified market of 54 countries, aims to address these challenges. However, its full implementation has been gradual, with only a few nations ratifying the key protocols on services and investment.
The WTO maintains that effective execution of the AfCFTA could “boost intra-African trade by more than 50 per cent by 2030.”
“Africa is an exciting continent, despite the challenges,” Okonjo-Iweala said, adding that sectors such as renewable energy, digital innovation, and manufacturing are showing immense potential, supported by a median age of just 19.
The African Development Bank also projects that, with consistent growth and regional integration, Africa could rise to become the world’s fourth-largest economy by mid-century.
Currently, the continent holds about 30 per cent of global mineral reserves, including lithium and cobalt—key materials for clean energy technologies. However, limited local processing capacity means much of these resources are exported in raw form, minimizing value addition.
“We need to move up the value chain,” Okonjo-Iweala said.
The WTO also expressed concern over external pressures such as geopolitical conflicts and climate change, which disrupt supply chains and inflate food and energy costs. The Russia-Ukraine conflict, for instance, has raised food and fertilizer prices, while climate-induced droughts and floods continue to affect production and logistics.
Less than three per cent of global climate finance currently reaches Africa, a shortfall the WTO says must be corrected for sustainable growth.
Regional leaders have reaffirmed their commitment to the AfCFTA rollout, targeting full operation by 2027. Initiatives like the Pan-African Payment and Settlement System are also expected to lower transaction costs and reduce dependence on foreign currencies.
“Africa is not a monolith; each country has its strengths,” Okonjo-Iweala said.
She cited Rwanda’s growing tech ecosystem and Morocco’s expanding automotive industry as examples of regional diversification.
“The challenges are real, but so is the opportunity,” she added, expressing confidence that with stronger infrastructure, coordinated policies, and effective implementation of trade reforms, Africa’s economic rise could reshape global trade dynamics.
She reaffirmed the WTO’s support for Africa’s efforts to double its growth rate and assume a central role in the global economy by 2050.
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