The African Free Trade Area and its Impact on the Volume of Intra-Regional Trade in light of Trade Openness to African Markets

A Case Study of Algeria's Exports to Africa Using the Gravity Model During the Period (2010-2022)

Abstract

This study aims to use the gravity model to analyze the trade exchange between Africa
and Algeria, and the potential role that African Free Trade Area countries could play in upgrading
Algeria's exports and increasing its opportunities to penetrate African markets and fully open up to
the continent. The study period spans from 2010 to 2022, encompassing 51 countries. Algeria's
participation in the African Free Trade Area represents a significant opportunity to increase its
intra-regional trade and openness to African markets, granting access to a market of over 1.3 billion
people and a GDP exceeding 3 trillion dollars. Through our study, we provide an overview of the
economic and trade performance of the African continent and the African Free Trade Area, as well
as the efforts of the state to penetrate these markets. We also analyze Algeria's trade exchanges
with countries in the region. Additionally, we delve into the gravity model, both theoretically and
practically, to elucidate the impact of study variables on trade flows between Algeria and the
region. The study concludes that there is a positive impact of variables such as the GDP of regional
countries, trade agreements, population, and maritime accessibility on trade flows. However, there
is a negative impact of Algeria's GDP and distance on intra-regional trade between Algeria and
other African countries.