Lagos: Dr Yemi Kale, Group Chief Economist at the African Export-Import Bank (Afreximbank), emphasized the necessity for Africa to bolster regional trade and financial systems to foster industrialisation, enhance value chains, and expedite economic transformation. Kale, who also serves as the Managing Director of Research and Trade Intelligence at Afreximbank, addressed this issue at Ecobank Nigeria’s Customer Forum, themed ‘Strengthening Regional Integration for Economic Transformation.’
According to News Agency of Nigeria, Kale, the former statistician-general of the National Bureau of Statistics, underscored that Africa’s trade future would be dictated by structure rather than volume. He highlighted the historical pattern of exporting raw commodities and importing finished goods. Kale stressed the importance of Africa processing its own products to actively engage in value chains. He pointed out that over 70 percent of exports still consist of primary commodities.
Kale noted that the African Continental Free Trade Area (AfCFTA) offers a significant opportunity but requires robust financial systems to be effective. He argued that trade agreements alone are not enough, as financial mechanisms are crucial for moving goods. Without efficient payment systems, trade finance, and cross-border banking networks, integration efforts will remain unfulfilled. He also emphasized the role of pan-African banks in facilitating seamless transactions.
Highlighting the challenges, Kale identified infrastructure deficits, high logistics costs, and fragmented regulations as major obstacles. He warned that transportation expenses in some African corridors could account for up to 40 percent of the final goods prices, which undermines competitiveness. Kale also highlighted Africa’s demographic potential, stating that by 2050, Africa will constitute a quarter of the global workforce. With the right infrastructure, skills, and digital systems, this young population could transform Africa into a global manufacturing and consumer hub.
Kale pointed to digital trade as a crucial element for integration, describing technology as a means to reduce friction, lower costs, and empower small businesses to trade across borders. He urged African countries to pivot from commodity dependence to value addition, citing opportunities in refining minerals, agro-processing, and green industrialisation. He posed a critical question on whether Africa will export raw materials like lithium and cocoa or manufacture products like batteries and chocolate, emphasizing that such decisions will shape the continent’s future prosperity.
Kale concluded by stating that the evolving global trade dynamics present Africa with an opportunity to diversify partnerships and strengthen intra-continental commerce. However, he cautioned that internal fragmentation could jeopardize progress. He called for Africa to unify in trade efforts to increase its presence in global value chains. The forum, attended by policymakers, financiers, and industry leaders, explored strategies to enhance exports, deepen intra-African trade, and accelerate economic transformation.