The Sustainable Development Goals and Agenda 2063: Implications for Economic Integration in Africa

Abstract

This paper examines how Africa’s recent efforts to promote economic integration, specifically
the Regional Economic Communities (RECs) and the proposed Continental Free Trade Area
(CFTA) are supported by and in harmony with the Post 2015 Development Agenda and the
African Union’s Agenda 2063 initiative.
The World Bank’s Global Economic Prospects projects for the period 2014-2017 that five of
the world’s 13 top growing economies will be in Africa. However, it is distressing and puzzling
that such growth has not been accompanied by reduced poverty, income inequality and
unemployment. It is also unsettling that few states met all of the Millennium Development
Goals (MDGs) which expired at the end of last year. Furthermore, Africa will likely be
confronted by daunting challenges in the near term. This ominous situation is enhanced by the
nature of Africa’s trade, both within the continent and in the global economy.
To counter some of these constraints, especially the tariff barriers, the RECs and the CFTA will
be critical in stimulating trade growth. Increased economic integration, either on a regional
level or on a continent-wide level under the general guidelines of the Sustainable Development
Goals (SDGs) and Agenda 2063 will result in increased trade which will, in the long term,
increase incomes, reduce poverty, increase employment, provide greater consumer choice, and
will offer shelter from exogenous external shocks. However, at least in the short term, such
gains are also typically accompanied by loses. This paper calls for a continental Integration
Compensation Funding Mechanism (ICFM) to balance some of these loses. The ICFM would
be developed and managed by the African Development Bank, the United Nations Economic
Commission for Africa and the African Union.