Transcript Approaches to positioning a country to benefit from - ilri

J. Tsoro Maiketso
&
Masedi Motswapong
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Outline
1. Introduction
2. Trade trends
3. Objectives of the Paper
4. Methods
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Introduction

Although agriculture’s contribution to GDP has declined,
it is still an important source of livelihood, especially for
the rural households
 Livestock is the main agriculture activity

Beef industry is the backbone of the rural economy
(SACU Trade Policy Review, 2009)
 Beef is the largest agricultural commodity export
 Are there opportunities to;
 Increase exports?
 Diversify exports?
 Diversify markets?
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Objectives
 Discuss the measures (policy and
legal provisions) affecting trade in
livestock and livestock products
 Analyse the determinants of
Botswana’s exports of livestock and
livestock products
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Exports of Fresh or chilled boneless bovine meat:
main markets (BWP millions)
300
1.
250
200
150
100
50
2007
2008
2009
United Kingdom
South Africa
2010
Germany
2011
Reunion
2012
Greece
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Exports of Fresh or chilled boneless bovine meat:
emerging markets (BWP millions)
1.
12
10
8
6
4
2
0
2007
2008
Netherlands
2009
Angola
2010
Swaziland
Namibia
2011
2012
Zimbabwe
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Exports of Frozen boneless bovine meat, main
markets (BWP millions)
1.
400
350
300
250
200
150
100
50
2007
2008
South Africa
2009
Germany
2010
Greece
United Kingdom
2011
2012
Netherlands
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Exports of Frozen boneless bovine meat, emerging
markets (BWP millions)
1.
7
6
5
4
3
2
1
2007
2008
Swaziland
2009
Mozambique
Namibia
2010
Angola
DRC
2011
Zimbabwe
2012
Antarctica
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Methods
 Review of measures affecting trade
 BMC Act [Chapter 74:04]; Export
monopoly?
 Control of Livestock Industry Act
[Chapter 36:01]; Restrictions on exports;
bans, levies, licensing etc
 Diseases of Animals Act [Chapter 37:01];
Diseases of animals and the role of SPS
measures
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Gravity model
In its general formation, the gravity equation is specified as
follows;
𝑋𝑖𝑗 = 𝐺𝑆𝑖 𝑀𝑗 ∅𝑖𝑗 ……………………………………………………………….…(1)
where 𝑋𝑖𝑗 = total exports from county i to country j
𝑀𝑗 = the importing county’s GDP or per capita GDP
𝑆𝑖 = exporter specific factors (i.e. exporter’s GDP)
∅𝑖𝑗 =distance between countries i and j
𝐺 = a constant
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Model cont’d
Taking natural logs of equation 1 yields the following estimation
ln 𝑋𝑖𝑗 = ln 𝐺 + ln 𝑆𝑖 +𝑙𝑛𝑀𝑗 + 𝑙𝑛∅𝑖𝑗 ……………………………………. (2)
More specifically equation 2 can be expressed as
ln 𝑋𝑖𝑗 = 𝛽0 + 𝛽1 𝑙𝑛𝑌𝑖 + 𝛽2 𝑙𝑛𝑌𝑗 + 𝛽3 𝑙𝑛𝐷𝑖𝑗 + 𝜖𝑖𝑗 ……………………. (3)
where 𝑌 denotes GDP and 𝐷 denotes distance, however other
variables can be included such as exchange rates and any other
variable that captures trade costs
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Data Sources
 The study will use data from Statistics Botswana and
where possible other data sourced from, Euro stat,
World Bank
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