UNCTAD: Inter-African trade too thin | Africa | DW | 11.07.2013
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UNCTAD: Inter-African trade too thin

African states should trade more with one another, a report from the UN trade and development body says. Regional trade alliances have been trying to bring down barrierrs for years - largely in vain!

Bildnummer: 51636533 Datum: 01.11.2004 Copyright: imago/Cityfiles Schiffe im Hafen von Guinea-Bissau PUBLICATIONxINxGERxSUIxAUTxONLY, Personen , Landschaft; 2003, Guinea-Bissau, Bisseau, Schiff, Häfen, Pier, Land, Leute, Einheimische, Einheimischer, Afrikaner, Mann, Männer, anlegen, Kahn, Kähne, Boot; , quer, Kbdig, Totale, Transport, Logistik, Wirtschaft, Rückansicht, Perspektive, , Schifffahrt, Verkehr, Afrika; Aufnahmedatum geschätzt

Guinea-Bissau Schiffe im Hafen

Emmanuel Edra is in the market in Jos when he takes the phone call from Deutsche Welle. He has been cultivating his potato crop on the fertile terrain of central Nigeria for more than 30 years. The tracts of land around Jos are the largest potato growing area in West Africa. A year ago, Edra discovered that there was a big demand for potatoes in neighboring Benin. So he hired a truck, filled it up with sacks of potatoes and drove 1,000 kilometers to Benin's capital Cotonou.

Still on Nigerian territory, he had to stop frequently at army and police checkpoints, which cost him time – and money in the shape of bribes so he could continue his journey. But his troubles really started on the border. "Everywhere I turned I had to pay bribes," he said.

When he left Jos he had 129 sacks of potatoes in his truck, but because of the delays most of them had turned rotten before he arrived in Benin. "I will not attempt this sort of deal again," he told DW.

Polizeiposten und gesperrte Straßen prägen den Alltag in der Millionenstadt Kano. Copyright: Katrin Gänsler Kano, Nigeria, 06.02.2012

Police checkpoints and roads closed to traffic are a common sight in Kano, Nigeria

Such are the obstacles to free trade on the continent of Africa, as the UN trade and development body UNCTAD has just confirmed in its latest report.

Commodity trade with the North dominates

In 1997, 20 percent of total African trade took place within the sub-Saharan region. In 2013, the figure is just 11 percent. In other words, the region's share of trade has roughly halved.

This is a serious problem, according to Taffere Tesfachew, director of UNCTAD's Africa division. African trade tends to center on the North and its developed economies, he said. There was also a dependence on commodity exports, whose price fluctuations have an enormous domestic impact on the exporting nations. "Asian countries, on the other hand, trade more amongst themselves and are therefore better protected against the eurozone crisis," Tesfachew said.

Asian states sell half of the goods they produce to other Asian nations; in Europe, intra-European trade accounts for more than 70 percent of total trade volume.

Professor Paul Collier hält Motivation für die Grundlage erfolgreicher Armutsbekämpfung Locating Social Entrepreneurship in the Global South: Innovations in Development Aid Ort: Wilson Center in Washington D.C. Datum: 12.3.2013 Bild: Rebecca Wetzel Die Fotos werden kostenfrei zur Verfügung gestellt.

Professor Paul Collier, expert on Africa's economies: "bitter reality"

African governments and the African Union are well aware that they are lagging behind. They have been trying to bring down trade barriers within regional blocs such as the Economic Community Of West African States (ECOWAS) and the East African Community (EAC). Their efforts have met with modest success. According to UNCTAD, a large share of African trade now takes place within these regional blocs. Nine countries, including Kenya, Senegal and Rwanda, buy more than 40 percent of the goods they import in other African countries.       

54 nations with trade barriers

But the regional blocs are also part of the problem, because many states are members of several blocs simultaneously. Economists refer to the "spaghetti bowl effect." Paul Collier from the University of Oxford, who specializes in African economies, said that the bitter reality on the African continent is that we have 54 countries full of trade barriers and "those countries block trade with their neighbors."

TO GO WITH AFP STORY BY JOEL OLATUNDE AGOI (FILES) A file photo taken on April 12, 2005 shows the Apapa Terminal parked full with containers in the main Nigerian seaport in Lagos. Since January 2009, the Nigerian Ports Authority (NPA) has been battling to clear Lagos port of congestion, which has been building up since October 2008 and which has led to several thousand containers being abandoned there. Every month, an average of 70 vessels -- container ships and oil tankers -- arrive in the Lagos port in addition to thousands of overtime containers abandoned by importers and customs agents because of complaints over high charges. AFP PHOTO / PIUS UTOMI EKPEI (Photo credit should read PIUS UTOMI EKPEI/AFP/Getty Images)

Most of the goods that arrive at the port of Lagos do not come from Africa

The latest UNCTAD report doesn't only call on African governments to reduce trade barriers, but also to persevere with industrialization and the expansion of infrastructure. Individual private enterprise and the private sector generally should be encouraged, as this was the only way to create sustained growth on the continent, the report concluded.

Africa's agricultural sector can't even feed the continent's population. 37 African nations import more food than they export. Nigeria is one of those nations – much to the annoyance of potato farmer Emmanuel Edra. After his abortive trip to Benin, he will limit himself to selling his crop in Jos. International hotels in Lagos and Abuja will continue to import frozen French fries from Europe.         

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