On May 30, 2019, the African Continental Free Trade Area (AfCFTA) came into force. It has been signed by 54 of the African Union's 55 members, leaving Eritrea as the only one that has not signed up. On Sunday, the AfCFTA's operational phase was official launched at the extraordinary AU summit. The agreement establishes the largest free trade area in the world since the creation of the World Trade Organization in 1995.

The AfCFTA will serve as one of the most important factors influencing Africa's economy in the future. Currently intra-African trade only counts for 15 percent of African's total exports, compared to intra-trade levels of 58 percent in Asia and 67 percent in Europe. High tariffs and colonial-era infrastructure make it easier for African countries to export to Europe or China than to each other. The AfCFTA, which establishes a single continental market for goods and services, seeks to increase African trade by cutting tariffs by 90 percent and harmonizing trading rules at continental level. If successful, the AfCFTA is expected to boost intra-African trade by 52.3 percent by 2022, making it the most decisive factor driving the growth of the African economy in the next decade.

Behind the drive for economic integration is the realization by African countries that Africa must develop first of all its local markets before it can compete on the world market. With regional and now continental markets, industries have a chance to develop where local markets are still too small to make important investments profitable.

The AfCFTA will also put African countries in a strategically better position to face the growing volatility of the global economy. Africa will be able to forge a new path for itself.

For instance, of Africa's current exports to other parts of the world, 75 percent are extractives such as oil and minerals, a big portion of the remainder is agricultural products, and only minuscule amount are industrial products. But 42 percent of intra-African trade is industrial products. Forming a single continental market will greatly boost African trade. This in turn will help African nations to develop their own value chain for industries and shift away from extractive exports toward trade in industrialized goods.

The AfCFTA will also be crucial in securing a better future for Africa's growing youth population. Africa, with its population set to double by 2050, needs to have a strategy to find more jobs and better lives for its young people. If it goes about business as usual, much of its economic growth will be absorbed by population growth, leaving even the most ambitious international development program struggling. The AfCFTA provides an answer to this. With a larger and more integrated-African market, the AfCFTA can better harness opportunities for economic diversification within the region and attract investments from developed countries. It will also place Africa in a much stronger bargaining power vis-a-vis much bigger global players such as Europe, the United States and China. With better trade deals, strong growth of capital investments, industrial output and technology transfers, Africa's youth will have the opportunities to prove that population growth is not a burden but an economic dividend.

Globally, a better economic outlook inside Africa will reduce economic migrants and refugees from African countries to other parts of the world. For instance, it will greatly reduce the strain on border security and the social welfare systems in many European countries. Currently, the money that African economic migrants send home to their families from Europe is more than European Union's investment pledges to Africa, resulting in a stagnation of EU's negotiations with African countries on the re-admission of migrants. If the AfCFTA succeeds, better economic prospects could fundamentally reverse these dynamics while making it profitable for larger investments to come from the Global North.

China has a unique role to play in Africa's economic integration and development. In 2015, China surpassed Europe as Africa's largest trading partner. The Chinese government provides tariff-free access to 97 percent of products from the Least Developed Countries in Africa. As a result, Africa's exports to China continue to grow, rising 32 percent year-on-year in 2018. In 2017, China surpassed the United States as the world's largest retail market. The Chinese market could continue to grow for African countries and not just its investment.

China has also extensive experience in improving its economy by upgrading its infrastructure which could be helpful to African countries. By connecting heartland cities with coastal cities, China has been able to lower its production costs by relocating production from expensive coastal areas to inner parts of China where production costs are low. Better infrastructure also serves to increase domestic consumption which drastically reduced China's reliance on foreign trade, and labor mobility was a vital ingredient for the industrial boom along the coast.

Last year, at the BRICS Summit in Johannesburg, President Xi Jinping called on the BRICS countries to form a partnership for the fourth industrial revolution. South Africa is one of the largest economies in Africa, and is the leader of Africa's technology development. With deepening cooperation between China and South Africa through the BRICS partnership in digitalization, industrialization and innovation, Chinese and African enterprises could work together to drive Africa's technology development.

The author is an assistant professor at Hunan University's School of Public Management and a visiting researcher at Tsinghua University's Belt and Road Research Institute.

The author contributed this article to China Watch exclusively. The views expressed do not necessarily reflect those of China Watch.

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