Digital trade regulatory environment: opportunities for regulatory harmonization in Africa

Abstract

This report provides empirical evidence to inform the negotiations and implementation of the African Continental Free Trade Area (AfCFTA Agreement with a view to promoting intra-African trade. It presents insights for the ongoing negotiations on the Digital Trade Protocol by identifying policy areas with high potential to foster digital trade in the African region. It does so through a gravity model by estimating empirically the relation between the regulatory regime for digital trade imposed by African countries and digital trade flows defined as trade in information and communication technology (ICT) goods and digitally enabled services to identify policies that have a stronger negative relation with digital trade between African countries and the rest of the world. The report also provides further insight for intraregional negotiations and lays out additional empirical analysis based on regulatory heterogeneity across African countries to identify how regulatory harmonization across policy areas could support digital trade in the region.