Developments in International Trade Stephen Karingi 2 nd June, 2011.

Developments in International Trade

Stephen Karingi2nd June, 2011


Contents • Key messages

• Africa’s Trade Performance

• WTO and EPAs Negotiations During 2010

• Status of the Aid for Trade Initiative in Africa

• Trade Preferences under AGOA

• South-South Cooperation: Africa-China Relations

• Conclusions and Recommendations


Key Messages

• African trade has recovered strongly in 2010.

• Neither WTO nor EPAs negotiations saw ground-breaking progress during 2010.

• The Aid for Trade momentum has been sustained, with the structure of allocations remaining the same.

• AGOA has been beneficial to African countries, but the uncertainty around this trade preference scheme remains.

• Africa-China relations are not solely focusing on trade, the FDI and ODA channel are also key in these relations.


Africa’s Trade Performance

Trade recovery was strong in 2010, led by a 28% increase in African exports….Merchandise Trade Growth Rates

-40.0

-20.0

0.0

20.0

40.0

60.0

80.0

Total merchandise trade Merchandise exports Merchandise imports


Africa's share of world Exports

(%)

Africa's Share of World

Trade(%)

0

1

2

3

4

5

6

7


…meaning Africa's share of world merchandise trade remained constant…Africa’s Share of World Merchandise Trade


0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

exp

ort

s

imp

ort

s

exp

ort

s

imp

ort

s

exp

ort

s

imp

ort

s

exp

ort

s

imp

ort

s

exp

ort

s

imp

ort

s

exp

ort

s

imp

ort

s

exp

ort

s

imp

ort

s

exp

ort

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imp

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exp

ort

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imp

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exp

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imp

ort

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exp

ort

s

imp

ort

s

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

cu

rre

nt

US

$, m

illio

ns

Transportation Travel Other commercial services


…while trade in services, led by exports in the travel sector, bounced back to pre-crisis levels.

Africa’s Commercial Services Trade


WTO and EPA Negotiations

• WTO Negotiations remain preoccupied with procedural rather than substantive issues.

• Some progress made, especially with respect to:– Banana Deal– Cotton Trade– Non-tariff barriers

• EPA negotiations similarly stagnant. Contentious areas remain:– Development friendly rules of origin

– Lack of financial support from EU beyond EDF


Americas

Asia

Europe Oceania

Africa

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

20000

disbursements

commitments

Aid for Trade InitiativeAfT commitments to Africa now surpass those to

Asia, while disbursements appear unaffected by the global downturn..AfT Commitments and Disbursements by Region, Constant ‘09 US$ (millions)


Aid for Trade Initiative

…with ‘Building Productive Capacity’ attracting a growing share.

AfT Commitments to Africa by Category, constant ‘09 US$ (millions)

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

2007 2008 2009

Trade Policy and Regulations, and Trade Realted Adjustment

Building Productive Capacity

Economic Infrastructure


African Growth and Opportunity Act

(AGOA)UNECA participated in AGOA’s mid term review in 2010.

Most respondents found AGOA to be important for relations with the US…

…mainly as a market for exports…

Not Important

24%

Important17%

Very Important

59%

Source of Investments

17%Source of Imports

10%

Market for Exports

73%


African Growth and Opportunity Act

(AGOA)…but only 51% of respondents are benefiting from AGOA.

Other key findings:• AGOA has bolstered creation of jobs and human capital.• Little evidence of impact on regional integration (only

21% of respondents are part of a regional value chain)• All respondents were in favor of expanding AGOA

beyond 2015, with 91% seeking it to be made permanent

• The expansion of trade and business promotion of African products in services in US markets was the most sought after revision.


Chinese-African Trade

• 11.2% of Africa’s exports go to China, in a relationship also based on aid and investment

• China now South Africa’s biggest trading partner• Trade accompanied by a 17-fold increase in

Chinese FDI for South Africa• Concerns pertaining to the lack of backward

linkages persist• A continental FTA could better facilitate win-win

opportunities of exchange between China and Africa


Conclusions and Recommendations

• Africa’s trade performance continues to be below potential and efforts should focus on:

– Production and export diversification– Improving competitiveness by tackling supply-side,

infrastructure and productive capacities constraints • A rapid conclusion of the DDR affording Africa meaningful

market access opportunities, flexibilities and expected developmental gains should be sought.

• The role of the state will be to reflect negotiation outcomes in their trade policies and regulations, linking these with economic transformation objectives which target growth, industrialization, employment and poverty concerns.

• Accelerated harmonization efforts are needed through the Tripartite FTA and the envisaged continental FTA to realize regional integration benefits.

Thank you for your kind attention

E-mail: [email protected]: www.uneca.org/atpc

mailto:[email protected]

http://www.uneca.org/atpc

Developments in International Trade Stephen Karingi 2 nd June, 2011.

Documents

trade commitments

trade databasefiles

trade initiative

trade momentum

global merchandise trade

trade sharesafricas

trade preference scheme

categorycommerical services