Abstract
African Continental Free Trade Area Agreement (AfCFTA) recognizes the potentials of well-developed and functional regional value chains (RVCs) and its capacity to unlock increased business activities, paced industrialization and socio-economic development. Whether it operates on stand-alone basis or in cohort with the rules of origin, RVCs are fundamental to any regional economic integration that seeks to foster structural transformation and uplift the living standards of its populace. While the RVCs’ growth in Africa is low (compared to Association of Southeast Asian Nations (ASEAN) and Mercosur) coupled with poor insertion into the global value chains (GVCs), efficient implementation of AfCFTA will alter the dynamics. For this to materialize however, state parties to AfCFTA must undertake important reforms that should redefine their current trade patterns characterized by trade in raw materials (or commodity-based trade). Arguably, state parties to AfCFTA should implement, (1) functional policies that leverage the growth of value chains in the intermediate inputs and finished products, (2) infrastructural connectivity, (3) targeted interventions to develop viable clusters of value chains that deepen industry – suppliers’ synergy across the region, (4) sustained development of technical know-how and skill reservoirs required in the intermediate inputs and finished products processing, and (5) deliberate policy of private sectors’ involvement in the execution of value chain agenda.
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