KEY POINTS
- Annual trade in goods and services between Africa and the Caribbean could reach $1.65 billion by 2030, excluding mineral fuels.
- About 80 per cent of Africa’s annual goods export potential to the Caribbean remains untapped.
- Caribbean export potential in services is estimated at $481 million.
- High transport costs, limited shipping links and restricted access to finance remain major barriers to trade between the regions.
MAIN STORY
Trade in goods and services between Africa and the Caribbean could reach $1.65 billion annually by 2030, excluding mineral fuels, according to a report by the International Trade Centre (ITC) and African Export-Import Bank (Afreximbank).
The report, Reshaping Africa-Caribbean Trade: Opportunities for Economic Transformation, was launched on November 3 on the sidelines of the Commonwealth Heads of Government Meeting in Antigua and Barbuda.
Despite historical and cultural ties between the two regions, trade remains a small share of their overall commercial activity, even though they have complementary opportunities across agriculture, manufacturing, services and the creative economy.
The report estimates that about 80 per cent of Africa’s annual goods export potential to the Caribbean remains untapped, pointing to significant room for businesses to expand their presence in each other’s markets.
It also identifies $481 million in potential Caribbean exports from the services sector, alongside opportunities in processed food and animal feed, chemicals, minerals and metals, apparel and textiles, leather and footwear, tourism, transport services and creative industries.
The findings draw on trade and export potential analysis, sector assessments and a survey of 1,175 businesses and business support organisations across Africa and the Caribbean.
THE ISSUES
The report identifies transport costs and weak logistics connections as major obstacles to expanding trade between the regions. Limited direct shipping links make it more difficult and costly for businesses to move goods between African and Caribbean markets.
Other challenges include regulatory barriers, limited access to finance and difficulties finding reliable commercial partners.
These constraints mean that identifying export opportunities alone may not translate into actual trade growth. Businesses also need affordable transport, reliable payment channels, financing and better information about market requirements.
The report therefore argues that stronger economic cooperation should go beyond the exchange of goods. Joint investment ventures, digital services, tourism and creative industries could provide additional channels for businesses to build commercial relationships.
Its recommendations include improving market intelligence and business matchmaking, expanding trade finance and payment solutions, strengthening transport connections, developing sector-specific value chains and improving regulatory cooperation.
WHAT’S BEING SAID
“At a time of major shifts in global trade, countries need to strengthen regional ties and invest in value addition, to build resilience.” – Pamela Coke-Hamilton, Executive Director, International Trade Centre.
“We know the major trade opportunities between Africa and the Caribbean – and now we can focus on helping businesses take advantage of those opportunities through better market intelligence, improved logistics and greater access to finance.” – Pamela Coke-Hamilton, Executive Director, International Trade Centre.
“Africa and the Caribbean must transform a shared history into shared prosperity.” – Denys Denya, Senior Executive Vice President, Afreximbank.
WHAT’S NEXT
Afreximbank says it is supporting stronger commercial links through financing, payment solutions and business networking initiatives.
Denys Denya said the bank has about $1 billion in approved transactions and a $5 billion regional financing commitment. He also cited its CARICOM office in Barbados, the annual Afri-Caribbean Trade and Investment Forum, the Caribbean-Africa Payment and Settlement System (CAPSS) and the Creative Africa Nexus (CANEX) initiative.
The report calls for targeted action by governments, financial institutions and business support organisations to address the barriers preventing companies from taking advantage of the identified opportunities.
BOTTOM LINE
Africa and the Caribbean have significant untapped trade opportunities, but reaching the projected $1.65 billion annual trade potential by 2030 will depend on reducing the cost of doing business between the regions, improving logistics and expanding access to finance and markets.
