The Brussels effect in Africa: is it beneficial for intra-regional trade in digital services?

Martina F Ferracane, Simón González Ugarte and Erik van der Marel

Journal of International Economic Law, 2025, vol. 28, issue 1, 1-22

Abstract: With cross-border data flows being central to the African Union’s digital transformation, African countries have adopted varied approaches to governing data transfers. We categorize these approaches into three regulatory models—open, conditional, and control—reflecting frameworks promoted by the USA, the European Union, and China, respectively. Using a gravity model, we assess how these models, along with comprehensive data protection laws, influence intra-regional trade in digital services. Our findings show that countries following the US-inspired open model experience higher trade volumes with other African trade partners, while the widespread adoption of the EU-inspired conditional model negatively impacts intra-regional digital trade. We do not find significant effects for the China-inspired control model. Additionally, we find that the adoption of a comprehensive data protection law, which in the region is often modelled after the EU’s General Data Protection Regulation, correlates negatively with trade, particularly for lower-income countries, potentially due to the cost burden of compliance. In the context of the recent commitment to open data flows undertaken by African Union members in the African Continental Free Trade Area’s Digital Trade Protocol, we estimate that open data flows could boost intra-regional digital services trade by 10.3%, or around 125 million USD. When developing regional data rules, we recommend that policymakers consider the unique needs of lower-income countries and provide technical assistance to face compliance costs.

Date: 2025
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