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GTAP Resources: Resource Display

GTAP Resource #6968

"Country-level implications of AfCFTA Agreement’s implementation on inequality and poverty"
by Mevel, Simon, Stephen Karingi and Souleymane Sadio Diallo


Abstract
The Agreement establishing the African Continental Free Trade Area (AfCFTA) entered into force on 30 May 2019. Trading under the Agreement began on 1 January 2021. However, the first trade only took place after the launch by AfCFTA Secretariat in October 2022 of the Guided Trade Initiative (GTI), expected to test and then facilitate implementation of the Agreement by all State Parties. As of 15 April 2023, 54 of the 55 African Union (AU) member States had signed the Agreement; of which 46 had ratified it. It is against this backdrop that, in 2021, the United Nations Economic Commission for Africa (ECA) and the Centre for International Research and Economic Modelling (CIREM) undertook a new comprehensive assessment of the economic implications of the Agreement’s implementation. The analysis relies on CGE modelling. ECA went a step further to use findings from the CGE analysis, along with collected household surveys data, to feed into a microsimulation model for inequality and poverty analysis at country-level.

Findings indicate that effective implementation of the Agreement would help boost intra-African trade in all main sectors, with clear opportunities to promote industrialization through trade. The AfCFTA is further expected to contribute to inequality and poverty reduction. Nonetheless, it should be noted that the overall impact on poverty and inequality would be relatively modest and uneven across countries as well as across individuals within a country, based on their socio-economic characteristics. After Agreement’s implementation, poverty will still be predominantly rural and the decline in poverty will generally be greater for males than females. Crossing all findings, women living in rural areas with limited education and employed in the informal sector would tend to benefit the least from the Agreement as it currently stands. Ongoing negotiation on AfCFTA Protocol for women and youth in trade is therefore critical to ensure a more inclusive Agreement.


Resource Details (Export Citation) GTAP Keywords
Category: 2023 Conference Paper
Status: Published
By/In: Presented during the 26th Annual Conference on Global Economic Analysis (Bordeaux, France)
Date: 2023
Version: 1
Created: Mevel, S. (4/15/2023)
Updated: Mevel, S. (4/15/2023)
Visits: 541
- Dynamic modeling
- Economic analysis of poverty
- Preferential trading arrangements
- Africa (Central)
- Africa (East)
- Africa (North)
- Africa (Southern)
- Africa (West)


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