Special Report
TradeTrend
Published: Sep 26, 2026
ADDIS ABABA, September 26, 2026: As AI-driven economic change and global trade diversification reshape the international economy, developing African nations are recalibrating diplomacy, partnerships and trade strategies — raising a central question of how much strategic room they are gaining to choose their economic partners.
The African Union’s recent Africa-Arab partnership discussions have focused on moving cooperation from declarations toward implementation, with expanded trade and investment, infrastructure development, food security, sustainable financing and knowledge exchange among the areas identified for action. The AU’s wider integration agenda places regional production and implementation of continental agreements alongside stronger external partnerships.
Africa’s share of global merchandise trade in 2025
Africa’s FDI inflows in 2025
Share of Africa’s merchandise exports consisting of primary goods in 2025
The United Nations Economic Commission for Africa records a different measure of the continent’s position in the global economy. Africa’s share of global merchandise trade fell from about 5% in 1994 to 2.8% in 2025, while its contribution to global manufacturing value added remains below 2%. ECA has argued that trade liberalisation alone has not produced the structural transformation needed to alter that position.
Foreign investment is becoming more closely connected to strategic sectors. UN Trade and Development (UNCTAD) recorded about $70 billion in FDI flows to Africa in 2025, the third-highest level since 1990, with investment concentrated in energy, infrastructure, critical minerals and selected manufacturing activities. The value of announced greenfield projects nevertheless fell by almost one-third even as the number of projects increased.
Critical minerals have added another dimension to Africa’s external economic position. Copper, cobalt, lithium, manganese, graphite, platinum-group metals and rare earth elements are attracting attention because of their role in batteries, electric vehicles, renewable energy and advanced technologies. African institutions are increasingly linking mineral development with beneficiation, processing, manufacturing and local supplier development.
Digital transformation is entering the same economic discussion. African Union and ECA frameworks identify digital infrastructure, data, computing capacity, digital trade and artificial intelligence as components of economic development, while ECA’s Economic Report on Africa 2026 connects AI, digital platforms, advanced manufacturing and energy technologies with productivity and diversification.Africa's Trade Dynamics: Global Share vs. Commodity Reliance
Comparing Africa's share of global merchandise trade against the percentage of primary goods in its exports (1994–2025).
Economic Diplomacy And A Wider Partnership Map
South Africa has placed economic diplomacy directly within the work of its overseas missions. Its Department of International Relations and Cooperation describes diplomatic missions as platforms for facilitating, connecting and advocating for South African businesses. The government has also pursued access to continental trade and industrial finance through its relationship with Afreximbank.
Ghana has incorporated trade, investment and technology into its bilateral diplomacy, pursuing partnerships involving industrialisation, technology transfer, market access and value addition through engagements with the United States, Morocco and Zimbabwe. Rwanda’s Ministry of Foreign Affairs and International Cooperation records agreements with Oman covering political consultations, labour, trade and investment, logistics, agriculture and strategic investment.
Research by the African Economic Research Consortium examines China-Africa engagement through trade, investment and development finance, including the concentration of African exports in extractive industries and the implications for industrial policy and domestic value capture.
African business organisations are also treating external partnerships as part of a wider commercial strategy. The African Trade Chamber places manufacturing, mining, energy, agriculture, health, logistics and infrastructure within its trade and investment agenda, alongside AfCFTA implementation and regional value chains.
The African Chamber of Commerce in China focuses on connecting African and Chinese companies, providing market information, supporting African-owned enterprises in China and helping businesses navigate commercial and regulatory environments. The Ghana India Chamber of Commerce identifies technology transfer, manufacturing, agribusiness, healthcare, energy and logistics as areas for bilateral commercial cooperation.
The African Union has institutionalised strategic partnerships with China, India and the European Union, covering combinations of trade, investment, infrastructure, technology transfer, capacity building and regional integration. Gulf investment has added another source of capital, particularly in ports, logistics, food systems, energy and critical minerals.
Chatham House research estimates more than $100 billion in Gulf investment in Africa and examines how the distribution of benefits can differ between African economies and Gulf investors.
Afrobarometer’s 2026 survey provides a citizen perspective on the changing external environment. Sixty-two percent of respondents supported free trade, while 71% said African countries should have more say in international decision-making. At the same time, 63% said it was difficult to cross borders to work or trade, and only 13% said they had heard of AfCFTA.
Afreximbank’s 2025 African Trade Report estimates an annual African trade-finance gap of about $100 billion and says only 18% of African banks’ trade-finance portfolios support intra-African trade. A separate African Development Bank trade-finance study estimates unmet demand at between $74 billion and $92 billion in 2024, reflecting different methodologies and measures.
From Commodity Exports To Regional Trade
The World Bank’s latest assessment of African integration places cross-border production at the centre of the next phase of continental trade. About 15–20% of Africa’s total trade is intra-African, but this trade is more diversified and manufacturing-intensive than exports to markets outside the continent.
The East African Community’s latest trade figures provide a current example. EAC exports to other African markets rose 44.3% in the second quarter of 2026 to $7.2 billion, accounting for 27.5% of total EAC exports. Total EAC trade reached $52.3 billion during the quarter, with exports rising faster than imports.
Approximate share of Africa’s total trade conducted within Africa
Rise in EAC exports to African markets in Q2 2026
Share of Africa’s merchandise exports that were primary goods in 2025
The composition of Africa’s global exports remains markedly different. UNCTADstat records primary goods as accounting for 76.7% of Africa’s merchandise exports in 2025, with fuels representing 29.5% of primary-goods exports.
Regional organisations are pursuing industrial priorities that include agro-processing, pharmaceuticals and mineral beneficiation. The Southern African Development Community (SADC)’s industrial strategy places participation in regional and global value chains at the centre of its approach, including agro-processing, minerals beneficiation, industry and services.
Services provide another route for diversification. The World Bank identifies transport, telecommunications, financial and professional services as areas where deeper integration could expand intra-African services trade under AfCFTA.
Payment infrastructure is developing alongside this trade agenda. PAPSS, the Pan-African Payment and Settlement System, is expanding participation by African financial institutions and central banks, enabling eligible cross-border transactions to be settled in African currencies.
Afreximbank’s trade-finance research identifies limited access to finance as another obstacle to intra-African commerce. Its 2025 African Trade Report estimates the annual gap at about $100 billion, while its broader analysis identifies financing conditions, borrowing costs and regulatory requirements as constraints on African firms seeking to expand regional trade.Diplomatic Intent vs. On-the-Ground Trade Friction
Key indicators from Afrobarometer (2026) citizen surveys and Afreximbank trade financing data.
AI Moves Into Africa’s Development Agenda
The African Union’s Continental Artificial Intelligence Strategy treats artificial intelligence as a strategic asset for economic development, innovation and high-value employment. The strategy calls for an Africa-centric, development-focused approach to AI and greater national and continental capacity.
The AU Peace and Security Council has called for increased investment in Africa’s AI ecosystem, including digital infrastructure, data systems, computing capacity and human capital. It has also called for cooperation among governments, regional economic communities, private-sector actors, academia, civil society and international partners.
ECA’s Economic Report on Africa 2026 places AI, digital platforms, advanced manufacturing and energy technologies within the productivity and diversification agenda. Its digital-transformation work also addresses data governance, digital public infrastructure, digital trade and regional connectivity.
The Centre for Intellectual Property and Information Technology Law at Strathmore University (CIPIT) examines Africa’s AI development through infrastructure, data governance, local innovation, skills and responsible AI policy. Its research includes indigenous datasets and African technological capacity alongside regulatory questions.
Estimated contribution of mobile technologies and services to Africa’s economy in 2025
Share of African GDP attributed to the mobile ecosystem
Share of Africa’s population not using mobile internet despite living within mobile broadband coverage
The Institute for Security Studies has focused on the physical infrastructure behind AI capability. Its analysis identifies electricity, computing capacity, data centres, cooling systems, connectivity and data ecosystems as constraints on African AI development, with implications for technological and data sovereignty.
The commercial digital economy is already substantial. GSMA estimates that mobile technologies and services contributed about $240 billion to Africa’s economy in 2025, equivalent to 7.8% of GDP, and supported approximately 13 million jobs. Its 2026 assessment identifies AI applications in network optimisation, predictive maintenance and customer services, alongside work on Africa’s AI language gap.
Connectivity remains uneven. GSMA estimates that 63% of Africa’s population was not using mobile internet in 2025 despite living within mobile broadband coverage. Affordability, device access, digital skills and relevant content remain among the barriers identified by the industry.
The United Nations Development Programme’s Africa bureau has examined the infrastructure and institutional requirements surrounding AI deployment. Its September 2026 study of country-hosted AI computing capacity in Kenya, Malawi, Rwanda, South Africa, Togo and Zambia identifies data, skilled operators, institutional responsibilities, governance, cybersecurity and sustainable financing as requirements for turning computing infrastructure into sustained national capability.
A More Competitive Field For Trade And Investment
Research by the African Economic Research Consortium records China-Africa trade at $275 billion in 2024, including $93 billion in African exports to China. Its research finds that African exports remain concentrated in extractive industries, including copper, bauxite, aluminium, chromium, manganese and cobalt.
The African Union has linked China’s expanded tariff-free access for African products with opportunities for agro-processing, manufacturing, special economic zones and regional value chains. China implemented expanded zero-tariff treatment covering all 53 African countries with which it maintains diplomatic relations from May 2026, according to the Chinese government.
The European Union’s Global Gateway Africa-Europe Investment Package covers transport, digital connectivity, energy, health, education and private-sector development, with a stated investment package of €150 billion.
US economic engagement with African countries includes trade-enabling infrastructure, digital infrastructure, critical minerals, energy and supply chains. Ghana’s government has separately called for its relationship with the United States to place greater emphasis on trade, investment, technology and productive enterprise.
The Africa-India partnership covers trade, investment, technology transfer and capacity building. The India-Africa Forum Summit and its associated business dialogue are institutional platforms for expanding those relationships.
Gulf investment has expanded across ports, logistics, food systems, energy and critical minerals. Chatham House research identifies both the economic opportunities and potential asymmetries associated with that investment.
African chambers and business organisations have placed manufacturing, mining, energy, agriculture, health, logistics and infrastructure within their external trade and investment programmes. The African Trade Chamber links these areas with AfCFTA implementation, regional value chains and industrial growth, while the African Chamber of Commerce in China focuses on company-to-company connections and support for African-owned enterprises.
The Ghana India Chamber of Commerce has identified technology transfer, manufacturing, agribusiness, healthcare, energy and logistics as areas for bilateral commercial cooperation.
Across these relationships, African institutions and businesses have sought not only market access and capital but also processing, manufacturing, technology, skills and participation in higher-value activities.
Infrastructure, Finance And The Capacity Constraint
The African Development Bank’s 2026 African Economic Outlook identifies development financing, geopolitical fragmentation, trade tensions, regional conflicts and declining international financial flows among the pressures affecting African economies. The Bank has called for greater mobilisation of African domestic capital and stronger financial systems.
Estimated unmet African trade-finance demand in 2024
Share of African banks’ trade-finance portfolios supporting intra-African trade, according to Afreximbank
External public-debt service as a share of government revenue in Sub-Saharan Africa in 2025
The Bank’s 2025 trade-finance report estimates unmet African trade-finance demand at between $74 billion and $92 billion in 2024. Foreign-exchange liquidity shortages were identified by surveyed banks as a major constraint on expanding trade finance.
The World Bank has documented pressure on both public investment and debt service. Public capital investment in Sub-Saharan Africa remained about 20% below its 2014 level, while the ratio of external public-debt service to government revenue doubled from 9% in 2017 to 18% in 2025.
Electricity remains a direct requirement for manufacturing, mineral processing, logistics and digital infrastructure. World Bank regional-integration programmes identify electricity access, regional power markets and infrastructure financing among the requirements for deeper economic integration.
The World Bank’s latest integration assessment identifies customs, transport, standards, payments, services, energy, finance and digital systems as barriers separating African markets. It estimates that about 60% of trade costs arise behind national borders, including customs delays, logistics constraints, regulatory divergence, transport restrictions and weak infrastructure.
African private-sector research has also examined the capacity to prepare and finance bankable infrastructure projects. The African Policy Research Institute identifies project preparation, institutional capacity, regulatory processes, financing structures and investor confidence among issues affecting private-sector participation in infrastructure development.
The International Monetary Fund has documented a sharp decline in bilateral aid to Sub-Saharan Africa. Its June 2026 analysis said early estimates pointed to cuts of about 26% in 2025, while its Regional Economic Outlook assessed a broader range of 16–28% in bilateral aid budgets. The IMF has identified domestic revenue mobilisation, private-sector development and the allocation of scarce public resources among the issues facing economies as external financing becomes more constrained.
Energy, food and fertiliser shocks continue to expose differences in national capacity to absorb external disruptions. African and international development institutions have documented transmission through import costs, inflation, fiscal pressures and food-security risks.
The World Bank has also linked Africa’s demographic trajectory to the need for productive employment. More than 620 million people are expected to enter the continent’s labour force by 2050, increasing the importance of productivity, private-sector growth, infrastructure and skills.
