The World Trade Organization (WTO) released its updated global trade outlook on October 10, with mixed news for Africa. While the continent's overall export growth forecast was lowered, there was a positive shift in intra-African trade.
The share of intra-African trade in Africa's overall trade rose from 11% to 12% in H1 2024, as reported by Nee Coleman, the WTO’s economic affairs officer. During the same period, the continent experienced a 5% drop in imports.
While this rise in intra-African trade may seem small, it reflects the positive impact of ongoing efforts to enhance trade. The African Continental Free Trade Area (AfCFTA) is now operational, and Coleman pointed out that preliminary estimates suggest a gradual increase in intra-regional trade. This growth could be vital in helping Africa diversify its trading partners and protect its economies from external economic shocks.
WTO has also revised its 2024 trade outlook for the continent. Exports are now projected to grow by only 2.5%, down from an earlier estimate of 5.3% while imports are expected to rise by just 1%, a sharp drop from the previous prediction of 4.4%. For 2025, WTO anticipates a 2.2% increase in exports and a 1.1% rise in imports. These adjustments come from “an overall revision of African trade statistics and a larger-than-expected decline in imports from Europe, Africa's main trading partnerâ€.
Despite these hurdles, Africa's GDP is expected to grow by 3.2% in 2024, “based on market exchange ratesâ€. Worldwide, WTO has slightly raised its forecast for world trade growth in 2024 to 2.7%, up from a previous estimate of 2.6%. However, the outlook for 2025 has been downgraded to 3%, down from 3.3%.
Ralph Ossa, the WTO's chief economist, highlighted that “the short-term outlook for services trade is more positive than for goods trade, with the dollar value of commercial services trade increasing 8% year-on-year in the first quarter of 2024â€. He expects this upward trend to continue into the second quarter.