- with readers working within the Securities & Investment industries
The ambition of the African Continental Free Trade Area (AfCFTA) is transformative: creating a vast single market and unlocking trillions in consumer and business spending by 2030. For South African businesses seeking to scale into this integrated market, M&A is proving to be the most effective accelerant, turning continental integration from a long-term goal into an immediate reality.
The sheer projected growth—with intra-Africa trade expected to increase by 81% by 2035—is driving this strategic shift. Rather than incurring the significant time and costs associated with greenfield projects in multiple new territories, acquisitions allow companies to immediately inherit established market presence, local distribution networks, and critical regulatory knowledge that is often difficult for new entrants to obtain.
This inorganic growth directly supports the development of Regional Value Chains (RVCs), a core pillar of the AfCFTA. For example, a South African industrial firm can acquire component manufacturers in East or West Africa, positioning itself to benefit from local content rules and preferential trade within the new free trade zone. Research supports this strategy, showing that intra-regional deals tend to outperform purely domestic deals, especially within established economic groupings like the Southern Africa Customs Union (SACU).
Ultimately the volume and value of M&A activity across the continent serve as a powerful signal of investor confidence in the AfCFTA's success. M&A is the vehicle that delivers tangible market integration.
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