Kumari, G. (2025). The Impact of AfCFTA on Economic Growth: A Panel Data Analysis of African Countries. Ecofunomics, 7(1), 41–47. https://doi.org/10.5281/zenodo.14713095
Abstract
Intending to lift 50 million people out of extreme poverty, the African Continental Free Trade Area (AfCFTA) started trading among its member countries in January 2021. The main objective of the AfCFTA includes reducing trade-related problems, smoothing investment opportunities, and removing trade barriers in African countries. This study uses panel data to examine the impact of foreign aid, inflation, the AfCFTA agreement, and external debt on the GDP of African countries. The annual data used in the analysis was collected from different sources from 2000 to 2022. Out of 54 African countries, 35 were taken for study based on availability of data. A fixed effect panel regression model has been used in this study to establish the relationship between the GDP of African countries and the AfCFTA agreement, inflation, external debt, and foreign aid. The results indicate that the AfCFTA membership has a significant positive impact, highlighting the benefits of regional trade integration among African countries in fostering GDP.
Keywords: Africa, GDP, AfCFTA, FDI, Panel data
JEL Classifications: N27, O55, F21, C23
Author
Gunjan Kumari
PhD Research Scholar
Indian Institute of Foreign Trade
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