Transcript Slide 1

From international trade to
regional & south-south trade
FRANCESCO RAMPA
Head of Food Security Programme
GDPRD
20 May 2015, The Hague
Evolving trade patterns…both commercial trends &
policy/political direction
• After 90’s, Regionalism as main trade policy
[since DDA stuck]
• RTA easier (simpler; common aims/institutions,
easier to harmonize behind-border measures,
more time for adjustment, regional scale
economies; easier to predict losers)
• African RECs, ASEAN, APEC, etc…TTIP…vs WTO..
…distortion/diversion in a globalised economy?
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Share of intra-regional trade
& share of regional value added in the intra-regional
trade (by main region, 2011, %)
80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
Europe
Asia
Share of intra-regional trade
North
America
Latin America
Africa
Middle East
Share of regional value added in intra-regional trade
Africa’s trade patterns
• Africa still a net importer of agric. products,
while patterns of agric. export largely
characterized by few traditional commodities
• To meet its basic food demand, Africa relies on
imports from outside the continent (87% of
imports from the RoW vs. 13% from Africa)
(UNECA)
• Africa’s basic food products EXP also directed
towards external partners despite its strong
internal needs (78% of exports to the RoW vs.
22% to Africa)
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..though improved intra-Afr agr trade from 90’s to 00’
Increased regional integration, especially when looking at the
nutritional contents of ag.trade flows
African Imports
Dollars (value)
1990-1995
2002-2007
kCal
1990-1995
2002-2007
Africa
Asia
Europe LAC
NorthAmerica Oceania
6.77% 17.26% 37.90% 9.96%
12.39% 19.81% 35.23% 15.97%
24.79%
13.68%
3.31%
2.93%
3.09% 14.23% 23.81% 10.44%
7.05% 20.38% 27.06% 19.45%
44.81%
21.63%
3.62%
4.43%
Shift in external
suppliers among
Americas
Role of African intra-trade over the
previous decade has more than doubled.
African Exports
Dollars (value)
1990-1995
2002-2007
kCal
1990-1995
2002-2007
Africa
Asia
Europe LAC
NorthAmerica Oceania
7.99% 16.79% 67.32% 0.61%
15.15% 14.86% 62.51% 0.53%
6.95%
6.10%
0.34%
0.84%
13.80% 26.20% 49.96% 2.99%
31.41% 29.21% 34.03% 0.92%
6.59%
4.19%
0.46%
0.23%
1/3 of the calories exported by Africa, go to Africa
Source: Bouet,
Deason and Laborde
(2014)
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SS trade on the rise
• China…but also Braz, India, Gulf, Turkey…
• total trade China-Africa increased by 25%
between 1995 and 2013.. Chinese imports
from and exports to Africa increased by
29% and 22%, respectively
• …RSA 31% of total China-Africa trade in
2013…mineral products 58% of Chinese IMP,
machinery 26% of Chinese EXP
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…why regional trade is crucial…
• Challenge is to get food
from rural areas to
consumers in growing
urban centers
• Nearest city is often across
a border
• Provides incentive to invest
in higher productivity
Source: Haggblade et al (2008).
• Integrated reg.markets enable food to move from
surplus to deficit areas, increasing food availability,
reducing price volatility, stimulating diversification
• more value created and remain in the region
(employment too)(beyond cash crop EXP)
• RI as gradual integration of developing countries into
global economy, transiting from low competitiveness
commod.trade to reg markets to maturity in GVCs
• Africa: sufficient dissimilarity in current country
production & trading patterns
• …FDI-led regionalism and corridors
• …Political commitment, Malabo Declaration:
tripling…but…infrastr & Governance & Policy
Bottlenecks
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low supply response, no incentives to inv, export bans…
(Agr.
development?)
Corridors
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Trade Policy Barriers for expanding trade
• Despite RI [tariffs within RECs
in Africa
Average Import Tariffs on
Agri-food imports
•
18.0%
16.0%
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
•
ECOWAS
CEMAC
Applied to non SSA countries
COMESA
–
–
–
Tariffs Heterogenity on selected
products among African Custom
Unions
SACU
Applied to SSA countries
And huge potential for an ambitious trade
facilitation agenda:
–
going down], intra-Africa trade
still affected by significant tariffs
[still significant between RECs],
espec in Agric…need to address
between blocks trade barriers
External pressure to liberalize
markets with third countries (EPA
with the EU..)
Still instability / uncertainty
regarding some trade policies
Free Circulation of goods still not achieved
within Custom Unions (intra-trade still
affected by MFN tariffs, double taxation…)
Numerous fees and bribes
Administrative burden
Inefficiency of checkpoints (delays)
100%
80%
60%
40%
20%
0%
CEMAC
ECOWAS
COMESA
SACU
How could intra-Africa agric.trade perform?
Under a business as usual scenario? +122% on
average
% increase in intra-SSA trade between 2013 and
2030
CEMAC
CEMAC
COMESA ECOWAS SACU
67%
148%
80%
88%
COMESA
148%
146%
179%
116%
ECOWAS
80%
179%
136%
137%
SACU
88%
116%
137%
111%
200%
150%
100%
50%
0%
Source: MIRAGRODEP model simulations, Bouet,
Deason and Laborde (2014)
Which levers could we use to reach the CAADP
target (+200% from 2014 to 2025, Malabo
declaration)?
– Addressing trade policy barriers
– Improving infrastructure
Source: MIRAGRODEP model simulations, Bouet,
Deason and Laborde (2014)
UNECA study: if ALL tariff barriers within Africa are removed through
the CFTA, and African countries achieve a reduction of costs to trade
across borders (i.e. more efficient customs procedures, faster inland
transport and port handling)


The share of intra-African trade in strictly agricultural products
would increase by more than 57% over the next 10 years; passing
from about 20% today to nearly 32%:
 With highest increases found in wheat, cereals, sugar cane and
sugar beet, milk and dairy, meat as well as processed food
 re-orientation of trade flows would reduce reliance on
ext.partners to satisfy Africa’s food needs, potentially contribute
in reversing negative trade balances for food products.
Positive impacts on wages of agricultural workers would also be
found…Yet, only if supply-side constraints are effectively addressed
• Role of informal trade in Africa: huge potential for
increasing official level of integration (not included in
existing measure)
• ownership and implementation of regional trade
agenda at national level is not always ensured
• distribution of RI benefits? …hegemons…..regional
champions can be rent-seekers
• SO: instead of CFTA and wholesale RFTAs, pragmatic
(PPP) initiatives to remove trade barriers for a small
set of priority food commodities, where real political
commitment and commercial interests can effectively
change policies and practices ?
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THIS GROUP:
• Political economy analysis and trade policy
issues that constrain open regional trade
• Challenges and opportunities : reg. corridor
approaches & trade facilitation for PSD for food
security
• a common vision on ?
 the role donors can play in promoting regional
trade
 opportunities for private sector/FDI
involvement in infrastructure development,
logistics, agri-biz for regional trade
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Thank you
[email protected]
www.ecdpm.org/foodsecurity
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