Advancing cross-border trade & international collaborations in 2025
Practical strategies for overcoming challenges such as regulatory complexities, currency volatility, and logistics hurdles are key to ensure businesses can expand internationally. Bolaji Sofoluwe, Managing Director of ETK Group joins CNBC Africa for more on the evolving landscape of global trade, key trends and opportunities shaping cross-border commerce this year.
Fri, 17 Jan 2025 11:57:18 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Changes in government policies and attitudes are expected to shift towards protectionism before easing as new strategies are implemented
- African SMEs are leveraging the AfCFTA for cross-border trade growth, with a focus on strategic partnerships and trading in local currencies
- Wicked problems like corruption and infrastructure challenges require education and trust-building campaigns for intentional trade strategies
The year 2024 was described as volatile in the global trade landscape, with businesses facing challenges such as regulatory complexities, currency volatility, and logistics hurdles. Bolaji Sofoluwe, the Managing Director of ETK Group, shared insights on the key trends and opportunities shaping cross-border commerce this year. With changes in government policies and attitudes towards trade, Sofoluwe mentioned an expected shift towards protectionism in some markets, followed by an easing as governments implement new strategies. African SMEs have seen a 3.2% increase in cross-border trade, showing a growing enthusiasm for trading across borders. The African Continental Free Trade Area (AfCFTA) has provided opportunities for businesses to expand, with mid, small, and micro businesses leading the way. Regulatory uncertainties and currency volatilities present challenges for businesses, but systems like the Pan-African Payment System (PAPS) offer advantages for trading with local currencies. Strategic partnerships and joint ventures with companies in other markets are becoming more common to foster growth. However, businesses in some regions face wicked problems such as corruption and infrastructure challenges, requiring campaigns for education and trust-building to promote intentional trade strategies. The ETK Group is ambitious about their projects this year, with a focus on infrastructure, healthcare, and agriculture sectors. Sofoluwe highlighted the importance of African companies seizing the opportunity in the agriculture sector due to global demand for agricultural commodities. The biggest risk to the global trade landscape, according to Sofoluwe, would be the implementation of high tariffs by the new US administration, particularly on China. This could lead to disruptions in trans-Pacific trade, impacting prices and the shipping industry. Despite potential shocks, being prepared for volatility and planning in advance can help mitigate risks in the evolving global trade landscape.
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