E-commerce – Africa’s ticket to a potential US$75 billion by 2025

E-commerce – Africa's ticket to a potential US billion by 2025

How to capitalise on the African Continental Free Trade Area (AfCFTA) and develop an African e-commerce strategy for possible adoption by the Africa Union (AU) dominated discussion at a recent AU conference in Kenya.

Jean Bertrand Azapmo, Regional Trade Advisor at the AU Trade & Industry Department, said, “The roadmap provides for the mapping of stakeholders and the creation of Multi-stakeholder Working Group/Platforms so as to provide an opportunity for African SMEs and startups to share experiences and best practices, share ideas; which is crucial for e-commerce development.”

Organisers have confirmed that input from the conference will be used to develop the ARIA (Assessing Regional Integration in Africa) IX Report, currently being prepared by UNECA to evaluate the case for e-commerce and digital trade as a topic for the Phase II negotiations in AfCFTA.

On the question of how the roadmap will trickle down to reflect positively on start-ups or other small tech businesses in various parts of Africa, Azapmo added: “Creating online platforms through which SMEs can share information, knowledge and knowhow (Enterprise Africa Network and Youth and Women Networks in E-commerce) as well as establishing an African Trade Observatory are high on the AU agenda and will contribute to enhancing e-commerce in Africa.”

Key takeaways from the conference include that e-commerce can contribute towards increasing intra-African trade which currently stands at around 18% leveraging the recently-launched AfCFTA as one of the flagship projects of Agenda 2063 to boost Africa’s share of global trade from its current estimated less than 3%.

Organisers cite a McKinsey and Co 2013 report which predicted that e-commerce in Africa could reach US$75 billion by 2025, with Nigeria in the lead.

It also showed that e-commerce now contributes more than 1% to the GDP of several African countries including Senegal (3%), Kenya (2.9%), Morocco (2.3%), Mozambique (1.6%), Nigeria (1.5%), South Africa (1.4%), and Ghana (1.1%).

The conference was organised in partnership with UNECA and Hub & Spokes Programme funded by the EU, ACP Secretariat, Commonwealth Secretariat and l’Organisation Internationale de la Francophonie, and UN-OHRLS.

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