Structural barriers and credit risks hinder intra-African trade expansion

Recent trade surveys and regional reports highlight a significant gap between the growing appetite for intra-African commerce and the structural barriers preventing its realization. While 81.3% of senior executives surveyed in the 2026 PAFTRAC Africa CEO Trade Survey expect cross-border activity to expand, intra-African merchandise trade remains stagnant at approximately 15% to 18% of total exports.

A major obstacle is the high cost of capital. Analysis suggests that Western credit rating methodologies impose a “prejudice premium” on African sovereign and institutional borrowers, resulting in an estimated $31 billion annual excess cost. Furthermore, 57% of executives report that accessing trade finance for cross-border transactions is difficult or very difficult, contributing to an SME financing gap estimated at over $331 billion.

In Southern Africa, the Southern African Development Community (SADC) reported that intra-regional trade accounted for 20.2% of total regional trade in 2025. However, organizations face complexities in regional sourcing due to inconsistent regulations, customs requirements, and limited visibility of supplier capabilities. Challenges such as energy shortages, logistics bottlenecks, and infrastructure constraints continue to hinder the development of robust regional value chains.