The AfCFTA and the entrepôt economy: a clash of free trade and political realities

Abstract

ABSTRACT This article uses the case of Benin to explore the tension between the political realities of African countries and the objectives of the AfCFTA. For most of the country’s independence, Benin’s political economy has been based primarily on informal and/or illegal entrepôt trade with Nigeria. Benin’s entrepôt system creates a loophole around trade barriers for products that are stringently regulated in Nigeria by enabling their importation to Benin, and then in turn, re-exporting or smuggling them into Nigeria. This article argues that informal and/or illegal entrepôt trade with Nigeria is so ingrained in Benin’s political economy that regional and continental free trade (which is incompatible with entrepôt trade) is all but impossible from Benin’s perspective. The entrepôt system is one of the main sources of government revenue, which ruling elites are not willing to surrender.