Africa’s share in $30 trillion global trade is only 3% – ATPC
Despite the exponential increase in the volume as well as the value of goods and services traded across borders Africa’s share in global trade continues to decline.
Global trade (in current prices) has increased from $13 trillion in 2000 to an estimated $30 trillion in 2010, but Africa’s share in world trade has been in decline since 1980 and currently stands at about three per cent, according to the African Trade Policy Centre (ATPC) of the United Nations Economic Commission for Africa (UNECA).
The ATPC has therefore, announced the first African Trade Forum in Addis Ababa, Ethiopia this November 2011 to address the issue.
It is of the view that the experience of most developed countries and emerging economies points unequivocally to the significant role that trade has played in stimulating growth and enhancing economic development.
Arguing that empirical evidence also suggests that trade, complemented by appropriate domestic policies and a supportive external environment, has been one of the most powerful catalysts for economic transformation in poor countries, including those in Africa, and yet African countries have not benefited from the steady increase in the volume of international trade.
“The continent remains heavily dependent on the export of a few primary commodities, most of which until recently had suffered significant decline in prices over the years, leading to large trade losses and worsening balance of payments,” the ATPC says on its website.
It argues further that among other factors, most of Africa’s exports are derived from the agricultural sector, but Africa has been unable to increase its productivity because of low investment in the sector.
The continent it says has not been able to tap into cheaper finance, efficient logistics (including transport and communication networks), increased capital resources and skills, which play a key role in international trade.
Adding that the combined effect of trade-distorting domestic support and export subsidies provided by developed countries to their producers; high tariff peaks and tariff escalation; the erosion of preferences for developing countries; the application of non-tariff barriers in trade; all of which are significant features of the trade policy of Africa’s key trading partners, have had a negative impact on Africa’s competitiveness in global trade.
The strategic objective of the inaugural African Trade Forum, it says includes to promote and enhance multi-stakeholder policy dialogue and advocacy on trade issues in Africa, by mobilising all the different trade constituencies across Africa and the world in general, to debate and exchange views on all the key issues relating to intra-African trade, and Africa’s trade with the rest of the world.
The Forum to be held from November 22 to 24, 2011 intends to look at and review among others, the key challenges and opportunities in accelerating intra-African trade and enhancing Africa’s participation in global trade; Deliberate and agree on common approaches and implementation strategies to address key challenges and develop a comprehensive agenda on how trade can be used to stimulate and sustain growth in Africa.
It will also share experiences and best practices amongst various trade constituencies on enhancing trade performance in Africa.
By Emmanuel K. Dogbevi