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African countries should work together to develop regulatory systems to boost digital trade across the continent, the head of the World Trade Organization told Semafor Africa.
Ngozi Okonjo-Iweala, who is seeking a second term as director-general of the WTO, identified infrastructure deficits and patchwork regulatory frameworks as the biggest obstacles to digital trade in Africa. But protectionist approaches to digital trade could lead to almost a 1% loss in GDP in the long term, with “bigger losses for developing countries,” she said during Semafor’s “The Next 3 Billion” event in New York, citing the WTO’s research.
“Protectionism leads to fragmentation of trade” and avoiding it would make it easier for businesses to operate in Africa, said Okonjo-Iweala.
The value of digitally-delivered trade is about $4.25 trillion but Africa has only 0.9% of it, she estimated. Growing the continent’s share requires concerted efforts to establish the right regulatory systems in multiple countries.
Increasing Africa’s capacity for digital trade would require greater investment in electricity and telecommunications infrastructure, Okonjo-Iweala said. About 600 million Africans, or 40% of the continent’s population, lack electricity, the World Bank estimates.
