ABSTRACT
This chapter draws lessons upon challenges and success of the eight Regional Economic Communities (RECs) to infer guidance for the success of the African Continental Free Trade Area (AfCFTA). It evaluates the trade creation and trade diversion impacts of each of the eight RECs and examines their performance with the goal of drawing lessons and identifying challenges for the success of the AfCFTA. It establishes that despite significant heterogeneities, there is more trade creation than trade diversion and a generally positive impact on within-REC trade. Given that the AfCFTA is a much larger FTA compared to the existing RECs, it is important that economies use regional integration to create agglomeration economies to expand supply/production which in turn provides greater impetus to engage in GVCs. Given the costs of distance and the benefits of already existing strong trade corridors, it is imperative that integration efforts start with a focus on selected high-density corridors of trade. Expanding trade on an African level is a daunting task but is achievable and feasible if sub-regional corridors of trade and production integration are strengthened to build regional value chains that serve as key hubs of GVCs. However, there are many challenges that African countries and regional and global entities need to address to realize the objectives of the AfCFTA and transform the continent. Learning from the regional economic communities is central. But, given the scope of the African Continental Free Trade Area, there is also a need to examine the transition from regional economic communities to the African Continental Free Trade Area, which is expected to be a sticky transition.
