Uganda and the African Continental Free Trade Area (AfCFTA)

Project Active from to Firms and Trade

African economies, including Uganda, are embarking on an ambitious programme of regional integration in the form of the African Continental Free Trade Area (AfCFTA).

The objective of this project is to study the implications of the African Continental Free Trade Area for Uganda using an approach that accounts for the heterogeneity of the impact across products and firms. A particular focus will be on opportunities to enhance Uganda exports.

The objective is to draw policy recommendations from the analysis to assist Ugandan authorities in enhancing the benefit of the AfCFTA for the country. Specifically, the project aims to focus on the anticipated reduction in tariffs between Uganda, South Africa and Ghana as markets of key interest to Ugandan policymakers.

The project first draws upon newly sourced transaction level trade data for Uganda from 2015 up to December 2020 to present a firm-level analysis of Ugandan exports. Next, the project conducts a partial equilibrium simulation of the trade impact arising from tariff reductions due to the AfCFTA, by leveraging a newly constructed SMART model. The ultimate goal of this exercise is to not only provide analytical input on an imminent policy reform, but also to build an analytical basis for further work and policy advice related to Uganda’s participation in the AfCFTA.