- Africa's products are transported to national ports and shipped overseas, while the same trade routes ship Asian and European products into each country's interior. Why can Africa not realise its economy-boosting potential of intra-continental trade, AU researchers ask.
How much African countries trade with each other is crucial to the integration and development of the continent, a draft report to be published jointly by UN's Economic Commission for Africa (UNECA), the African Union (AU) and African Development Bank (AfDB) states.
"There is a great potential in intra-African trade. Why is the continent not able to achieve this potential?" asks Daniel Tanoe of UNECA. The researcher made his comments during his presentation at an internal review in the Addis Ababa offices of the UN this weekend.
Mr Tanoe presented the latest edition of Assessing Regional Integration in Africa (ARIA) report. ARIA is one of UNECA's flagship reports. The report looks into regional integration. The biannual report provides an in-depth analysis and evaluation of progress made in Africa's regional integration process, the major achievements and the challenges that are still being faced.
This fourth edition of ARIA focuses on intra-African trade, looking into the reasons that countries on the continent are so poor at trading with one another.
The statistics on intra-African trade in comparison with other regions are sobering, with only a mere 10 percent of African countries trading with each other. In comparison, 40 percent of trade from North America is done with other North American countries. That figure rises to 63 percent when looking at trade between European Union countries. In all these regions, the intra-continental trade is a major source of employment and wealth, but in Africa, this is still not the case.
"The aim is to promote trade within Africa," said UNECA officer Joseph Atta-Mensah. "Why is it that I, as a typical villager from Ghana cannot find Ghanaian goods in Ethiopia, or when I go to Ghana, I cannot find my Ethiopian chai?"
The reasons for the lack of trade between African countries were found to be numerous. The report highlights several, including infrastructure problems - poorly developed or maintained roads, as well as numerous road blocks and check points -, high tariffs between countries, and lack of a coherent, unified payment system to facilitate trade.
The report acknowledges the role the informal sector has to pay in intra-African trade and the importance of women to that sector. If accurate figures on the trade that takes place in the informal sector were captured, the statistics for intra-African trade would most probably be much higher.
The internal review was an opportunity for UNECA staff and other stakeholders to discuss the report and offer feedback. The ARIA IV report is expected to be published later this year.
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