The Growth and Challenges of Sub-Saharan Africa’s Trade Landscape

Sub-Saharan Africa is experiencing a significant upswing in its goods trade, achieving a remarkable 9.7% growth in the first half of 2025 compared to the same period in 2024. This impressive figure marks the fastest rate of growth globally, predominantly driven by a surge in exports from the region. According to a report by logistics firm DHL, the exports alone recorded about 16% growth, overshadowing the approximately 8% increase seen in East Asia and the Pacific, the next fastest-growing export region.

Import Growth and Regional Disparities

However, this export success does not paint a complete picture. The value of imports into Sub-Saharan Africa only grew by around 4%. In contrast, North America and the Middle East & North Africa enjoyed greater growth rates of 9% and 8%, respectively. This uneven distribution illustrates a critical aspect of the trade landscape; while exports thrive, the region still grapples with slower import growth, signaling potential weaknesses in its trade dynamics.

Within Sub-Saharan Africa, countries such as the Central African Republic, Zambia, Eritrea, Burkina Faso, and Senegal have demonstrated the fastest trade value growth. In absolute terms, Ghana, Zambia, Côte d’Ivoire, the Democratic Republic of Congo, and Senegal have contributed significantly to increased trade revenues, showcasing the diversity of economic contributors within the region.

The Impact of US Tariffs

Despite these promising figures, a cloud looms over the trade growth forecast due to anticipated US tariffs on African exports. The report predicts that Sub-Saharan Africa’s trade volume growth will likely slow to an annualized rate of 4.3% through 2029, down from the previously anticipated 5.3% as of January 2025. This decline reflects the negative impact of the expiring African Growth and Opportunity Act (AGOA), which provided crucial tariff-free access to the US market for numerous African nations.

The last two decades have seen a shift in Sub-Saharan Africa’s international trade relationships, increasingly connecting the region to China and its allies. Nonetheless, the US and its allies—major European economies—still account for more trade activity with Sub-Saharan Africa than China, underscoring the region’s complex trade dynamics and potential vulnerabilities.

The Need for Increased Intra-African Trade

As external conditions fluctuate, increasing intra-African trade emerges as a compelling solution. However, the DHL report reveals that intra-regional trade remains surprisingly low, with only 19% of trade occurring within Sub-Saharan Africa in 2024. This figure is starkly contrasted by a world average of around 50.7%. The region’s trade often involves long distances, with an average distance of 7,074 km traveled for trade flows, compared to a global average of just 5,000 km.

Countries like Eswatini, Lesotho, Mali, Botswana, and Namibia recorded the highest rates of intra-regional trade, while Cabo Verde, Sudan, Ethiopia, Mauritania, and Equatorial Guinea fell behind. This disparity highlights the need for more robust intra-African trade relations to foster sustainability and economic resilience.

Encouraging Trends in Foreign Direct Investment

Despite challenges in goods trade, there are positive indicators regarding foreign direct investment (FDI). The report notes an increase in both outward and inward greenfield FDI projects as well as merger and acquisition transactions across the region from 2004 to 2024. Though goods exports within Sub-Saharan Africa have seen only modest increases and imports have decreased, these FDI trends suggest that businesses and investors are looking for opportunities within the continent.

Optimism for the Future

Steven Altman, a research assistant professor at NYU Stern, expresses cautious optimism regarding intra-African trade. He acknowledges that while the groundwork for these trade links is being established—facilitated by policy initiatives like the African Continental Free Trade Area (AfCFTA)—it will take time for these relations to develop meaningfully. Altman emphasizes the importance of focusing not only on continental trade but also on enhancing sub-regional trade, particularly among neighboring countries.

In summary, while Sub-Saharan Africa grapples with external pressures such as US tariffs and challenges in intra-regional trade, the remarkable growth in exports, FDI, and various countries’ contributions to trade value heralds a transformative period for the region—if it can harness these dynamics effectively.