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A major trade deal signed in June 2015 is about to remake Africa. Dubbed the Tripartite Free Trade Area, the 26-nation market created by this deal will liberalize intra-Africa trade, foster cross-border infrastructure investment and stimulate industrial diversification.While many have long believed that intra-Africa trade is largely in unprocessed goods and raw materials, recent analysis has firmly established that more than half of intra-Africa trade is in intermediate and manufactured goods.Despite the rise in regional trade, only about 12 percent of the continent's commerce is internal, compared with 70 percent in Western Europe, 50 percent in Asia, 40 percent in North America, and 22 percent in South America.On average, products being sold within Africa attract a tariff of 8.7 percent, whereas similar goods coming from outside the region have a tariff of 2.5 percent.Probably the most important benefit of an integrated African market will be industrial development. Today, most African markets are too small to support large industrial investments, and the use of import duties to protect local industries is undercutting the prospects of deepening trade.A liberalized continental market will help spur further industrial growth.
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