Economic Development in Africa Export Performance following Trade Liberalization: Some Patterns and Policy Perspectives

This year’s Economic Development in Africa report examines Africa’s export performance following trade liberalization, with a view to proposing policies to improve export performance. The report shows that the extensive trade liberalization undertaken by African countries has not been followed by a substantial improvement in their export performance. This suggests that there are serious obstacles hampering a supply response to the new incentive structure created by the removal of barriers to trade. The obstacles mainly consist of structural problems related to weak capacity in the production and marketing of exports in both the agricultural and manufacturing sectors. Strong State capacity is required to increase access to factors of production and improve the business environment. In the manufacturing sector, efforts to improve all aspects of productivity and to create efficient export promotion agencies that help firms to identify and seize opportunities in export markets should be at the heart of industrial policy. The agricultural sector would benefit from better research and development, irrigation facilities and extension services. Greater liberalization of agricultural trade in the markets of developed countries is also key to improving Africa’s agricultural export performance.