Five reasons to support labor mobility in Africa

By Edwin Ikhuoria, ONE’s Africa Executive Director

One year on since the launch of the African Continental Free Trade Area (AfCFTA), the potential benefits remain enormous. Africa could realize an additional $450 billion in regional income growth by 2035 and lift 30 million people out of extreme poverty, as more citizens find decent employment.^[1] However, while trading under the AfCFTA has started, its full potential will not be unlocked if we do not improve the continent’s labor mobility to ensure that the right skills are available at the right place and the right time.

There has been some progress over the last five years in liberalizing visa access for intra-African travelers, but much more needs to be done. The AfDB’s 2020 Visa Openness Index shows that African citizens still need visas to travel to 46% of other African countries. Travelers in Africa find it difficult to get visas, and it remains much easier to travel around Africa on an EU passport than an African one.^[2]

Difficulty in getting a visa is not the only constraint hindering labor mobility across Africa. Even though about 70% of African migrants live in Africa and intra-African is on the rise^[3], many African countries still perceive African migrants as a problem, and they have been reluctant to establish frameworks that allow for cross-border recognition and acceptance of school certificates. Labor and immigration policies are too inflexible and permits and licenses are difficult and expensive to acquire.

To that end, the AU adopted the Protocol on the Free Movement of Persons in January 2018. Under the protocol, African nationals would have visa-free entry to host countries, and ultimately gain the right to work and establish a business across the continent. The AU promotes the protocol as a critical part of the aspiration for an integrated continent under Agenda 2063. As of January 2022, 32 countries have signed it. However, only four countries–Rwanda, Niger, Mali and São Tomé and Principe–have ratified it and Nigeria and South Africa, Africa’s two largest economies, have not signed or ratified the agreement.

Labor mobility is beneficial to Africa

Labor migration is good for trade and economic development, especially in developing countries. Free movement of people benefits both the countries of origin and destination. The benefits of free movement of people within Africa fall into five buckets:

1. Trade and tourism growth: When Rwanda eased travel requirements to just identification cards for neighboring countries in 2013, travels to the country increased markedly. Within two years, Rwanda’s cross-border trade with Kenya and Uganda increased by 50%.^[4] Free movement of people can also boost tourism. According to an African Development Bank report, tourism in the Seychelles increased by about 7% per year between 2009 and 2014, when the country abolished visas for African nationals.^[5]
2. Closing of skills and labor gaps: Skills missing in certain parts of Africa exist elsewhere on the continent. Allowing people to move freely will enable firms in destination countries to find the talents that boost productivity and revenue while easing demographic pressure in the countries of origin. Productivity enhancements will, in turn, boost economic growth and per-capita income. Although immigrants only make up 10% of the population of Côte d’Ivoire, which hosts the second-highest number of immigrant workers in Africa^[6], they account for about 19% of the country’s GDP.^[7]
3. Employment creation for locals: Although migrant workers may compete for jobs with nationals, their presence creates additional opportunities for native-born workers. In South Africa, recently arrived migrants positively impact native-born employment rates and wages, and their presence results in a decrease in unemployment.^[8] In Europe, free movement within the EU has lowered the average unemployment rate by 6%.^[9]
4. Increased government revenue: When migrant workers are employed in the formal economy of host countries, their employment can have a significant positive effect on public finance. Migrant workers pay on average three times more tax than native-born citizens in Rwanda.^[10] In Ghana, native borns only cover 70-80% of expenditures made in their favour, while immigrant workers pay up to 159% of government expenditure on them.^[11]
5. Remittances and knowledge transfer to countries of origin: African migrant workers sent about $85 billion to their families in 2019.^[12] Remittances from within Africa tend to reduce poverty more, because intra-African migrants tend to have poorer families than those working in other continents.^[13] When migrant workers return home, they often use their acquired skills and accumulated wealth to transform their economies by establishing new enterprises and transferring knowledge.

What needs to happen from here?

Maximizing the benefits of AfCFTA through freedom of movement for migrant workers and their families should be a priority for policymakers. If we genuinely want the AfCFTA to succeed, Africans should no longer be treated as foreigners in their own continent. We must act quickly and immediately to make freedom of movement within the continent smoother and safer for all.

Firstly, we need all countries to adopt, ratify, and implement the AU protocol on the free movement of people. With African economies struggling to recover from the economic crisis resulting from the COVID-19 pandemic, there is no better time to prioritize this to foster a broad-based recovery of key economic sectors, especially trade and tourism.

Secondly, African countries need to adopt common standard procedures, including flexible national labor, immigration, and professional licensing policies. A continent-wide digital identification system recognized by every African country should be established to develop reciprocal agreements on qualifications and skills. We need to create and enforce a common framework to mutually recognize accreditation systems and programs and ensure that educational certificates are acknowledged across all African countries. Frameworks that have been set up to do this, like the ECOWAS convention on the recognition and equivalence of degrees and the AU continental qualifications framework have to be effectively implemented and enforced. The East African Community’s mutual recognition agreements for professionals, which currently cover accountants, architects, engineers, and veterinarians, also offer a model for African-wide collaboration.

Thirdly, we need to establish a regional labor market information system–an Africa-wide skills database that enables employers to search for the people they need, regardless of where they live. To achieve this, African countries have to invest in and strengthen their own labor market information systems and aggregate information on available and required skills.

By implementing all of these measures and ensuring free movement of people and labor across the continent, we will enhance economic growth, allow firms to find skills more quickly, boost productivity, and enable Africans to trade more with Africans.