Export Diversification in Africa : The Importance of Good Trade Logistics
Economic activity in many African countries remains highly concentrated and exports are often dominated by mineral resources or a few primary products. The World Bank’s 2011 report on light manufacturing in Africa identified poor trade logistics pe...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2015
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2015/06/24655152/export-diversification-africa-role-trade-logistics http://hdl.handle.net/10986/22346 |
| Summary: | Economic activity in many African
countries remains highly concentrated and exports are often
dominated by mineral resources or a few primary products.
The World Bank’s 2011 report on light manufacturing in
Africa identified poor trade logistics performance as a
constraint that especially penalized African exporters that
relied on imported inputs, very often making them
uncompetitive. The report highlighted research that
demonstrated how poor logistics added roughly a 10 percent
production cost penalty in Ethiopia, Tanzania, and Zambia
across the five subsectors of light manufacturing where
opportunities were identified as greatest in Africa. The
report outlined how in Africa poor trade logistics increase
production costs (often wiping out the labor cost advantage)
and lead to long and unreliable delivery times, making local
firm’s unattractive suppliers to lead firms in global value
chains (GVCs), particularly for light manufacturing. This
note seeks to contribute to a review of progress in
achieving export diversification through greater exports of
light manufacturing products. It looks at recent trends in
the exports of the five categories of light manufacturing
identified as having strong potential in Africa. The note
reviews progress in improving trade logistics in Sub-Saharan
Africa, with a focus on the three countries highlighted in
the light manufacturing study: Ethiopia, Tanzania, and
Zambia, and additionally Kenya and Uganda. |
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