AfCFTA Ex-ante Analysis

Replication package for the EMJMD-EGEI dissertation titled "An Ex-ante Evaluation of the Economic Impact of the African Continental Free Trade Area (AfCFTA) on ex-ante evaluation of AfCFTA economic impacts" authored by Jamiu Olamilekan Badmus and supervised by Prof. Ruben Dewitte - Economist at the economic research team of ING and visiting professor at Ghent University, Belgium.

Overview

This repository contains the code and documentation for the ex-ante evaluation of the African Continental Free Trade Area (AfCFTA) agreement's economic impacts. The replicator should expect the whole code to run for about 2 to 3 days.

Data Availability

The data relied on in this dissertation can be found in the './input' folder of the repository. The data are donwloaded from the following sources:

1. ITPD-E-R02 Trade Database

   • Source: United States International Trade Commission (USITC)
   • URL: https://www.usitc.gov/data/gravity/itpde.htm
   • Coverage: 170 industries, 4 broad sectors, 265 countries, 1986-2019
   • Citation:
     • Borchert, I., Larch, M., Shikher, S., and Yotov, Y. (2022), "The International Trade and Production Database for Estimation - Release 2 (ITPD-E-R02)," USITC Working Paper 202207A.
     • Borchert, I., Larch, M., Shikher, S., and Yotov, Y. (2021), "The International Trade and Production Database for Estimation (ITPD-E)," International Economics, 166, 140166.

2. Dynamic Gravity Dataset (Version 2.1)

   • Source: United States International Trade Commission (USITC)
   • URL: https://www.usitc.gov/data/gravity/dgd.htm
   • Citation: Gurevich, T. and Herman, P. (2018). The Dynamic Gravity Dataset: 1948-2016. USITC Working Paper 2018-02-A.

3. Structural Gravity Database

   • Source: World Trade Organization
   • URL: https://www.wto.org/english/res_e/reser_e/structural_gravity_e.htm
   • Citation:
     • Larch, M., & Monteiro, J., Piermartini, R., and Yotov, Y. (2019). "On the Effects of GATT/WTO Membership on Trade: They are Positive and Large After All," WTO Staff Working Papers ERSD-2019-09, World Trade Organization (WTO), Economic Research and Statistics Division.

4. Tariff Data

   • Source: World Integrated Trade Solution (WITS)
   • URL: https://wits.worldbank.org/WITS/WITS/Restricted/Login.aspx

Computing environment

This code was run on a x86_64-w64-mingw32 platform of a Windows 10 x64 (build 26100) computer.

The analysis is conducted in the R programming environment. R is free, open-source and available for download here: https://www.r-project.org/. The code has been tested against R version 4.5.1 (2025-06-13 ucrt).

Once R is successfully set up on your system, you will need to install a number of external R libraries. I have provided the code to install all the necessary R libraries in each of the R scripts.

Instructions to replicators

The empirical data analysis takes place within the ./input, /code, and ./output directories respectively holding the external files, the code that operates on the files in the ./input directory, and the computational results.

Further files and directories refer to:

• The Readme files ./Readme.md, ./Readme.html, and ./Readme.docx are generated by ./Readme.Rmd.
• The ./afcfta_milestone_timeline.png and ./tralac_2024.png files are pictures that show the time phase of AfCFTA agreement and the map of countries that has signed and/or ratified the agreement, respectively.

Methodology

This research uses Poisson Pseudo-Maximum Likelihood (PPML) estimations and structural gravity modeling to evaluate the trade and welfare effects of AfCFTA.

Key Tables:

Table	Description	Location
3.1	Summary Statistics by Sector	output/tables/summary_statistics.tex
4.1	Intra-AfCFTA Trade Effects (Overall)	output/tables/tab_afcfta.tex
4.2-4.9	REC-specific Trade Results	output/tables/tab_amu.tex through tab_sadc.tex
C.1	General Equilibrium Table (with Robustness Check)	output/tables/welfare_effects_table.tex
C.2	Robustness: Partial Equilibrium	output/tables/tab_afcfta_rob.tex

Key Figures:

Figure	Description	Location
3.1	Trade and Tariff Evolution	output/figures/intra_africa_trade_and_tariffs_combined.pdf
3.2-3.9	REC Trade Flow Patterns	output/figures/rec_trade_flows_amu.pdf through rec_trade_flows_sadc.pdf
4.1	Overall AfCFTA Border Effects	output/figures/graph_afcfta_brdr.pdf
4.2	REC-specific Border Effects	output/figures/graph_amu_to_af.pdf through graph_af_to_amu.pdf, etc.
4.3	General Equilibrium (Welfare) Plots	output/figures/welfare_effects_with_row_geppml_agri.pdf though welfare_effects_with_row_geppml_struc.pdf

Contact

Jamiu Olamilekan Badmus

• GitHub: @jamiubadmusng
• Email: jamiubadmus001@gmail.com
• Website: https://sites.google.com/view/jamiu-olamilekan-badmus/