AfCFTA: How African countries rank on logistics

In its annual Emerging Markets Logistics Index, Agility reported that the global recession and the COVID-19 pandemic have significantly disrupted supply chains, forcing logistics professionals to adapt to new realities. Among the African countries, Nigeria saw a notable rise of five places to 30th overall, also emerging as a top 10 market for domestic logistics opportunities. As African nations gear up to leverage the African Continental Free Trade Area (AfCFTA), Geoffrey White, the CEO of Agility Africa, shared insights on how these countries fare in the logistics sector. White highlighted key takeaways from the index, indicating that Africa is expected to have a slower recovery compared to developed and other emerging markets, attributing the lag to the delayed vaccine rollout on the continent. While the overall emerging markets are projected to witness 5.9 percent growth in 2021, Africa is anticipated to recover at a slower pace, albeit showing signs of improvement in 2022. Two standout performers in the index from an African perspective were Nigeria and Kenya, with Nigeria excelling in improved domestic logistics infrastructure. The country showcased progress in road network enhancements, construction of free trade zones, and major capital projects, defying negative stereotypes and demonstrating tangible advancements. The profound impact of the COVID-19 pandemic on businesses in the logistics ecosystem was also a focal point. White acknowledged the challenges faced by Nigeria amid the pandemic and plummeting oil prices, leading to its recession in 2020. However, the index hinted at positive growth following the crisis, with accelerated trends in e-commerce, local content development, and the demand for local infrastructure and warehousing. The pandemic expedited long-predicted changes, reshaping the business landscape, and fostering innovation as companies adapted to new norms. The shift towards digitalization and advancements in fintech were notably highlighted as transformative forces post-pandemic, revolutionizing consumer access and market efficiency. As businesses strive to enhance competitiveness, embracing innovation remains paramount for sustainability and resilience. Additionally, the index emphasized the permanence of certain changes induced by the pandemic, particularly in streamlining business operations and reducing barriers to trade. Improved paperwork processes, digital system enhancements, and the implementation of the AfCFTA are poised to facilitate smoother movement of goods, cutting down transit times and costs across Africa. As the AfCFTA gains momentum and more countries ratify the agreement, the continent holds immense economic growth potential through bolstering regional trade and establishing itself as a key export hub. The focus on enhancing the ease of doing business and promoting seamless trade facilitation solidifies Africa's position as a burgeoning logistics market with vast opportunities awaiting in the post-pandemic era.