Ethiopia begins trading under AfCFTA

Photo credit: The Habari Network

The most ambitious single market experiment in the world crossed a milestone when Ethiopia, the second most populous country in Africa, began trading duty-free under the African Continental Free Trade Area (AfCFTA). The first cargo left Addis Ababa’s Bole International Airport in Oct, lending fresh impetus to a scheme that has been slow to take off.

The initial consignments were largely agricultural, transported by both air and road to Kenya, Somalia and South Africa. Air cargo included meat, fruit, and vegetables, while overland exports comprised pulses, oilseeds, coffee, and red kidney beans. Future shipments are expected to include textiles and industrial inputs, predominantly to Kenya.

These early exports underline Ethiopia’s intention to strengthen commercial ties elsewhere on the continent. In 2023, its trade with other African countries totalled about $1.7bn, representing just 9.1% of its overall imports and exports. Ethiopian Airlines, the state-owned carrier, handled part of the first air freight deliveries. With flights to more than 60 destinations in the rest of Africa, the airline provides Ethiopia with the transport network needed to capitalise on the free trade area.

The AfCFTA initiative seeks to boost economic growth and employment by eliminating tariffs and non-tariff barriers. Intra-African trade still accounts for only 14.4% of the region’s formal trade. Since the agreement’s operational launch in 2021, most activity has taken place under the Guided Trade Initiative (GTI) – a pilot launched in October 2022 to demonstrate that AfCFTA trade is feasible while ironing out legal and technical challenges. The GTI initially covered only eight countries and a narrow set of products for which rules of origin – criteria used to determine where a product is made for tariff purposes – had been finalised. Early transactions under the GTI included Rwandan coffee exports to Ghana, Cameroonian tea and dried pineapple shipments to Tunisia, and Kenyan automotive batteries sent to Ghana.

The AfCFTA is an initiative designed to bring together more than 1.5 billion people into a single market. Although its rollout has been slow, there are now signs that implementation is accelerating. By the end of 2024, participation in the GTI had expanded to 38 countries, with most having finalised tariff schedules and updated customs systems to enable trading under the scheme. South Africa began with two consignments departing from the port of Durban to Kenya and Ghana, while Nigeria’s first exports, destined for Cameroon, Kenya, Algeria, Uganda and Egypt, included products ranging from ceramics and textiles to cables and shea butter.

Despite the recent momentum, AfCFTA still remains constrained by a series of technical, logistical and administrative hurdles. Slow customs procedures and inconsistent regulations continue to restrict trade flows, limiting the benefits of tariff reductions. Infrastructure gaps – in roads, ports, power, and digital connectivity – also hinder the movement of goods and services. In addition, not all member countries have yet harmonised tariff schedules or established systems for verifying rules of origin. Such bottlenecks notwithstanding the AfCFTA demonstrates a deep seated African desire to merge their fragmented economies into one and by doing so overturn a colonial-era handicap that has kept the continent impoverished for over 300 years.

 

References

‘Ethiopia country brief’, African Export-Import Bank, April 2024

‘Ethiopian Airlines serves 84 African destinations with 5 added in 2024 – where next?’, Simple Flying, 13 September 2024

‘Ethiopia to launch duty-free exports to AfCFTA member states on October 9’, Addis Standard, 07 October 2025

‘Ethiopia starts trading with Kenya under AfCFTA’, The East African, 10 October 2025

‘Ethiopia begins shipment of goods under AfCFTA’, CGTN Africa, 11 October 2025

‘AfCFTA's first trade flows begin, but a long road lies ahead’, Ecofin, 13 October 2025

‘Ethiopia launches implementation of the African Continental Free Trade Area (AfCFTA) agreement’, Institute of Foreign Affairs, 15 October 2025

‘African Continental Free Trade Area (AfCFTA) legal texts and policy documents’, TRALAC, Accessed on 19 October 2025

‘African Trade Report 2025’, African Export-Import Bank, 2025