Trade and participation in global value chains can play a key role in economic diversification and development. This paper deepens the discussion about productivity growth and upgrading in agriculture in Africa, and the role of national, regional, and international value chains in supporting such structural change.
... Exibir mais + The analysis in this report is based on quantitative and qualitative surveys undertaken in 2016 in Ghana, Kenya, and Zambia, where 3,935 farmers, 60 aggregators, and 56 buyers in the maize, cassava, and sorghum value chains were interviewed in the three countries. The descriptive results show that farmers who were on a contract saw greater structural transformation; higher output; and better access to seeds, fertilizers, pesticides, technology, and extension services compared with farmers who were not on a contract. To identify more robustly the link between value chain participation and contract farming with productivity and upgrading, the paper looks at the relationship using a variety of empirical methodologies, ranging from ordinary least squares and probit regressions to propensity score matching. Based on the empirical evidence, the hypothesis that value chain participation leads to structural transformation cannot be confirmed. The paper does find evidence that formal or informal contractual arrangements that regulate the provision of inputs to production, such as fertilizer, technology, extension services, and market information, positively affect upgrading. It remains nevertheless important to understand the impact of government policies on the emergence of value chains given that value chains support contractual arrangements.
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Documento de trabalho sobre pesquisa de políticas WPS8506 JUL 06, 2018
Trade and participation in global value chains can play a key role in economic diversification and development. This paper deepens the discussion about productivity growth and upgrading in agriculture in Africa, and the role of national, regional, and international value chains in supporting such structural change.
... Exibir mais + The analysis in this report is based on quantitative and qualitative surveys undertaken in 2016 in Ghana, Kenya, and Zambia, where 3,935 farmers, sixty aggregators, and fifty-six buyers in the maize, cassava, and sorghum value chains were interviewed in the three countries. The descriptive results show that farmers who were on a contract saw greater structural transformation; higher output; and better access to seeds, fertilizers, pesticides, technology, and extension services compared with farmers who were not on a contract. To identify more robustly the link between value chain participation and contract farming with productivity and upgrading, the authors look at the relationship using a variety of empirical methodologies, ranging from ordinary least squares (OLS) and probit regressions to propensity score matching. Based on the empirical evidence, the hypothesis that value chain participation leads to structural transformation cannot be confirmed. Rather, any type of formal or informal agreement which regulates the provision of inputs to production, such as fertilizer, technology, extension services and market information is likely to have a stronger effect on upgrading than value chain participation per se. It remains nevertheless important to understand the impact of government policies on the emergence of value chains given that value chains support contractual arrangements.
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Ethiopia’s gross domestic product (GDP) growth is estimated to have rebounded to 10.9 percent in FY2017. According to official statistics, Ethiopia’s annual rate of economic growth, which averaged 10.3 percent over 2005/06-2015/16 (compared with the regional average of 5.4 percent), slowed to 8 percent in FY2016 due to drought-related lower agricultural production.
... Exibir mais + With agricultural recovery, gross domestic product (GDP) growth rebounded in FY2017. The pursuit of prudent fiscal policy, with a fiscal deficit at 3.4 percent of GDP, should help keep inflation under control, providing monetary conditions remain tight in the aftermath of the devaluation of the Birr in October 2017. Key challenges relate to poor export performance (Ethiopia’s growth has been driven by investment followed by private consumption) and weak trade balance, which reflect the lack of external competitiveness and the vulnerability to terms of-trade shocks. The rising risk of external debt distress may affect Ethiopia’s access to external finance. These developments require continued policy adjustment to crowd-in the private sector and strengthen Ethiopia’s competitiveness. Part one of this Economic Update, on recent economic developments and outlook, discusses Ethiopia’s growth strategy, emphasizing the sustainability of the country’s investment-focused and export-led growth model. Part two looks at the interlinkages between manufacturing and services, with a special focus on the role of distribution services in promoting Ethiopia’s export competitiveness and eventually its structural transformation.
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The Republic of South Sudan emerged in 2011 from decades of conflict as the world’s newest independent country, with huge state and peace building challenges, and extreme institutional and socio-economic deficits.By August 2016, South Sudan displayed all the signs of macroeconomic collapse,with output contracting, and inflation and parallel exchange market premium spiraling.The fiscal deficit remained high, although its exact magnitude is difficult to estimate given the lack of real time data.The financing situation is dire.
... Exibir mais + Monetization of the fiscal deficit explains to a large extent the high inflation, although there are some indications that borrowing from theBank of South Sudan had been limited in recent months.The current account deficit is estimated to have narrowed to about 1.6 percent in FY2016/17 from about 6.1 percent of GDP in FY2015/16.The South Sudanese Pound (SSP) continued to depreciate.Restoring peace, including reform of the security sector, followed by efforts to rein in public sector borrowing to levels that avoid printing money are necessary preconditions for any stabilization program.The FY17/18 National Budget aims to restore macroeconomic stability, but lacks credibility.Even if the economy showed some recovery starting in 2018, projections suggest that poverty will continue to rise through 2019 as economic growth is likely to be surpassed by population growth.
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Shifting Kenya’s private sector into higher gear: a trade and competitiveness agenda’ was born out of the World Bank’s Trade and Competitiveness (T&C) Global Practice recent stock taking of its work in Kenya.
... Exibir mais + This was part of a Programmatic Approach that aimed to organize T&C’s knowledge, advisory, and convening services to address Kenya’s development challenges in the private sector space. By Sub-Saharan African standards, Kenya has a large private sector, which accounts for around 70 percent of total formal employment. As a result, the dynamics of the private sector are a key determinant of the trajectory of the Kenyan economy. The country’s product market regulations a restrictive for domestic competitors and foreign entrants, and the actions of cartels and behavior of dominant firms across sectors undermines competition and hurts consumers. The Kenyan Government recognizes these challenges and has invested significantly in unlocking these bottlenecks with impressive results so far and several important laws passed. Additional efforts to ease regulatory constraints and expedite important legislative changes could improve the investment climate at national and county levels.
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The book speaks volumes about the latent potential for trade in services in Africa and the regulatory hurdles that providers face in materializing such flows, and proposes concrete policy action for integrating fragmented services markets in Africa.
... Exibir mais + The contributions to this volume seek to shed some light on uncharted opportunities for services trade in Africa, and invigorate and deepen the discussion about the role of services in trade diversification and economic upgrading on the continent. The focus is on less explored areas such as informal trade in services and trade in more sophisticated but equally neglected sectors such as professional services, education and health services, and services related to mining that are rarely associated with services trade in Africa. Novel data collection methods such as crowdsourcing and mystery shopping, pioneering knowledge transfer practices and experiences with innovative policy reforms applied to both modern and traditional services sectors are explored to draw attention to available assessment tools and policy instruments for possible refinement and broader application across sectors.
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From 1999 to 2011 Sudan had a period where it benefited from extensive discoveries of natural wealth through oil. But the oil economy had also clear symptoms of Dutch disease.
... Exibir mais + Agriculture suffered from neglect, and there were urgent calls to invest natural resource rents into economic diversification efforts. Relief to Sudan’s external debt crisis will be critical. The country economic memorandum (CEM) starts out with a series of simulations and a review of recent key literature on growth and diversification with the aim of defining a suitable approach for growth and diversification for Sudan. The sectoral structure of Sudan’s economy shows the growing importance of agriculture, less importance of extractives, and relative stability of other sectors (manufacturing, services) by 2030. Looking at other economies that were successful in their diversification efforts shows that they were able to broaden their endowments base by maximizing a triad of institutions to deliver services that ultimately increase productivity. The CEM finds that there is a case for Sudan to approach growth through diversification from two angles: the production and the endowment base, both of which rely on the effective utilization of key institutions. This analysis therefore uses a sectoral focus and looks at agriculture as sources for diversification, but also makes the case that trading of goods and services - especially of the higher value-added kind - can be a means to grow the endowment base of the country.
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From 1999 to 2011 Sudan had a period where it benefited from extensive discoveries of natural wealth through oil. But the oil economy had also clear symptoms of Dutch disease.
... Exibir mais + Agriculture suffered from neglect, and there were urgent calls to invest natural resource rents into economic diversification efforts. Relief to Sudan’s external debt crisis will be critical. The country economic memorandum (CEM) starts out with a series of simulations and a review of recent key literature on growth and diversification with the aim of defining a suitable approach for growth and diversification for Sudan. The sectoral structure of Sudan’s economy shows the growing importance of agriculture, less importance of extractives, and relative stability of other sectors (manufacturing, services) by 2030. Looking at other economies that were successful in their diversification efforts shows that they were able to broaden their endowments base by maximizing a triad of institutions to deliver services that ultimately increase productivity. The CEM finds that there is a case for Sudan to approach growth through diversification from two angles: the production and the endowment base, both of which rely on the effective utilization of key institutions. This analysis therefore uses a sectoral focus and looks at agriculture as sources for diversification, but also makes the case that trading of goods and services - especially of the higher value-added kind - can be a means to grow the endowment base of the country.
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From 1999 to 2011 Sudan had a period where it benefited from extensive discoveries of natural wealth through oil. But the oil economy had also clear symptoms of Dutch disease.
... Exibir mais + Agriculture suffered from neglect, and there were urgent calls to invest natural resource rents into economic diversification efforts. Relief to Sudan’s external debt crisis will be critical. The country economic memorandum (CEM) starts out with a series of simulations and a review of recent key literature on growth and diversification with the aim of defining a suitable approach for growth and diversification for Sudan. The sectoral structure of Sudan’s economy shows the growing importance of agriculture, less importance of extractives, and relative stability of other sectors (manufacturing, services) by 2030. Looking at other economies that were successful in their diversification efforts shows that they were able to broaden their endowments base by maximizing a triad of institutions to deliver services that ultimately increase productivity. The CEM finds that there is a case for Sudan to approach growth through diversification from two angles: the production and the endowment base, both of which rely on the effective utilization of key institutions. This analysis therefore uses a sectoral focus and looks at agriculture as sources for diversification, but also makes the case that trading of goods and services - especially of the higher value-added kind - can be a means to grow the endowment base of the country.
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This paper analyzes Zambian export patterns using a new transaction-level trade data set for the period 1999-2011. The data show that, in international comparison, Zambian exports are exceptionally concentrated (on mining products).
... Exibir mais + This reliance has been increasing in recent years. Zambia's exports are also characterized by a high level of churning of firms and products. Multivariate models of survival probabilities suggest that exchange rate volatility and difficult access to imported inputs significantly inhibit diversified and stable exports. The econometric analysis is complemented with a qualitative study of the Zambian export sector. The analysis concludes that one of the main policy levers for unleashing Zambia's full potential as an exporter is by facilitating access to imported inputs. Additional measures that ease foreign exchange transactions, simplify export and certification requirements, and increase the predictability of Zambia's trade regime could be effective to promote Zambia's nontraditional exports.
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Documento de trabalho sobre pesquisa de políticas WPS7151 JAN 01, 2015
This paper summarizes the nature and determinants of trade in education and health services in a selected group of countries in Eastern and Southern Africa, using a combination of quantitative and qualitative methods.
... Exibir mais + The paper presents results from new, innovative data collection methods, such as crowdsourcing, to shed some light on the magnitude, determinants, and restrictions on intra-African trade in education and health services. Assessments of trade and regulatory barriers, based on results from regulatory surveys conducted in selected East African countries, and case studies of success stories and less favorable experiences are then used to develop policy recommendations for using trade and regional integration more strategically to improve outcomes in education and health. The analysis shows that to turn these sectors around, policy action is required in the areas of education, domestic regulation, trade policy, labor mobility, and information and communications technologies at the national and international levels. To retain some of the scarce health workers in the region and enhance the region’s competitiveness in providing education and health services, African countries should allow for freer mobility of teachers and health care professionals.
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Informal trade supports the livelihood of hundreds of thousands of households in Africa, reaches markets and clients that are underserved by formal channels, and contributes to regional food security.
... Exibir mais + Despite numerous benefits, conducting cross-border transactions remains expensive for small traders in Africa. For example, small traders in Malawi and Zambia pay 62 percent more in per unit terms for border costs than large formal traders. While there are systems in place to facilitate cross-border trade such as the current Simplified Trade Regime (STR) that eases certain customs processes, a host of registration and other requirements remain in place and increase small traders' costs to uncompetitive levels. This note presents an overview of key challenges faced by small traders across Africa, and proposes the charter for cross-border traders as a potential solution to address them. Special attention is given to the case of Malawi and Zambia, where the Charter is currently being piloted by the World Bank in collaboration with the respective Governments, Traders' Associations, and border officials as part of the first joint policy action emerging from the Diagnostics Trade Integration Studies (DTIS) carried out in the two countries.
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Zambia continues to experience strong growth, but challenges are building up. Copper prices are declining, and global financial conditions are tightening.
... Exibir mais + At home, the fiscal deficit is becoming difficult to manage, and Zambia's currency has sharply depreciated. The government intends to reduce future budget deficits, but this would involve making difficult political choices. In the past few years inflation and interest rates have declined and the currency has been relatively stable, providing an environment for growth and reducing poverty. High inflation would hurt the poor most. The brief specifically focuses on the opportunity for Zambia to emerge as a major food exporter to Eastern and Southern Africa and the policy direction that would take it there; the need to reduce high costs of crossing borders that will facilitate regional trade in non-copper products; and a long-term approach to developing competitiveness of the local mining supply cluster.
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The diagnostic trade integration study (DTIS) update identifies the trade related constraints holding back Malawi from diversifying and deepening its production base, and increasing trade.
... Exibir mais + The DTIS update identifies and quantifies specific trade costs that determine the availability and price of inputs and the ability of producers to get their products to regional and international markets. The report focuses on tariff policies, regulatory issues impacting on trade, trade facilitation and logistics, and policies affecting agricultural trade and trade in services. Recognizing that the (enhanced) integrated framework and the DTIS (including the 2003 DTIS for Malawi) have not been effective in addressing many of the broader issues requiring large-scale physical investments in most countries, this DTIS update focuses on specific trade related policy and regulatory issues within the mandate and policy space of the ministry of trade and the national implementation unit or similar implementation mechanisms. In this context, the report is structured as follows: chapter one gives introduction. Chapter two outlines the current macroeconomic position and the level of trade openness, summarizes the status of the business enabling environment. Chapter three describes Malawi's current trade policy with a detailed review of the existing tariff schedules. Chapter four addresses a range of the key regulatory issues that raise costs for all producers in Malawi. Chapter five looks in depth at how the trade and regulatory policies within the agricultural sector impact on competitiveness. Finally, chapter six addresses the important issues of trade in services through focusing on professional services such as engineering, accounting, and law.
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Regional trade in Africa can play a vital role in diversifying economies and reducing dependence on the export of a few mineral products, in delivering food and energy security, in generating jobs for the increasing numbers of young people, and in alleviating poverty and promoting a shared prosperity.
... Exibir mais + Women play a key role in trade in Africa and will be essential to Africa's success in exploiting its trade potential. In many countries in Africa, the majority of small farmers are women, and they produce crops such as maize, cassava, cotton, and rice that have enormous potential for increased trade between African countries and with the global market. Women are also involved in providing services across borders, such as education, health, and professional services, including accountancy and legal services. Hundreds of thousands of women cross borders in Africa every day to deliver goods from areas where they are relatively cheap to areas in which they are in shorter supply. Yet, policy makers typically overlook women's contribution to trade and the challenges they face. This volume brings together a series of chapters that look at the ways that women participate in trade in Africa, the constraints they face, and the impact of those constraints. It seeks to extend the rather small amount of analytical work that has been devoted to this issue and to encourage researchers, especially in Africa, to look more carefully at the specific challenges women face. The chapters look at the conditions and challenges faced by three broad groups: informal cross border traders; women who participate in the production of traded goods and services, ranging from rural farmers of cotton to professional activities such as legal and accountancy services; and women entrepreneurs with dominant ownership of exporting companies. The book highlights the importance of identifying and removing the conditions that prevent women from exploiting the full potential of trading activities. This report is organized as follows: chapter one gives introduction; chapter two presents barriers, risks, and productive potential for small-scale traders in the Great lakes region; chapter three focuses on unshackling women traders: cross-border trade of Eru from Cameroon to Nigeria; chapter four focuses on women cross-border traders, challenges, and behavior change communications; chapter five gives the gender dimension of Uganda's cotton sector; chapter six focuses on services trade and gender; chapter seven focuses on gender in the tourism industry: the case of Kenya; chapter eight presents shape up and ship out?: gender constraints to growth and exporting in South Africa; and chapter nine presents trade and gender in Tanzania: what matters-participation or outcomes?.
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Documento de Trabalho 82520 JAN 01, 2013
Brenton, Paul; Gamberoni, Elisa; Sear, Catherine; Mora, Maria Elena Garcia; Roshan, Sabrina; Ndumbe, Louis Njie; Ityavyar, Susan D.; Baffes, John; Maratou-Kolias, Laura; Coste, Antoine; Dihel, Nora; Christian,, Michelle; Reis, Jose Guilherme; Bossuroy, Thomas; Campos, Francisco; Coville, Aidan; Goldstein, Markus; Roberts, Gareth; Sequeira, Sandra; Kweka, Josaphat; Haji, MahjabeenDisclosed
In 2012, Kenya's economy has been on a tightrope. Policy makers have had to walk a fine line between stabilizing the economy and maintaining the growth momentum.
... Exibir mais + While inflation has declined, the exchange rate stabilized, and the fiscal position improved, fundamental economic imbalances continue to make Kenya vulnerable to shocks. In the absence of economic and social turbulence, Kenya should grow at 5 percent in 2012 and 2013, which will still be substantially below its neighbors. Kenya has been benefitting from the integration and growth momentum in the East African Community (EAC), which has become one of the most vibrant economic regions in the world. However, despite impressive increases in trade between the five EAC partners in recent years, there is still a large untapped potential. EAC trade can increase several-fold if unnecessary restrictions in the trade of goods and services particularly nontariff barriers were removed.
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Documento de Trabalho (Série Numerada) 82380 JUN 01, 2012
Distribution services are an important driver of growth in East Africa. With contributions to gross domestic product (GDP) ranging from about 11 percent in Kenya, Rwanda, and Tanzania to more than 14 percent in Uganda in 2008/09 distribution services are a significant part of all East African economies.
... Exibir mais + The sector also employs an important part of the population (in many East African countries over 10 percent of the active population) and includes a high proportion of informal, unskilled, female and part-time workers. Distribution services are among the most rapidly expanding sectors in East Africa. Over the period 2001-08 (2004-08 for Uganda), distribution services have grown on average at 8 percent a year in Rwanda, 12 percent in Kenya and Tanzania and 20 percent in Uganda. This policy note documents the current state of distribution services in East Africa, including the patterns and the determinants of the diffusion of modern distribution channels and the increased internationalization in the region. It shows why, despite major transformations during the last decade, the distribution sector remains underdeveloped and the impact of reforms is uncertain. To strengthen the contribution of the sector to poverty reduction, policy action that addresses the concerns of the households and producers at the bottom of the income pyramid, especially in the informal sector, should be a priority in all East African countries. Policy action that enables a gradual transition of informal firms to formality as well as measures that encourage regulatory reform needs to complement the liberalization of the distribution sector in East Africa.
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This note explores the role of regional integration in addressing Burundi's trade and development challenges. It presents Burundi's main export and import challenges and discusses the role of regional integration in reducing the country's current high transport costs, diversifying its trade flows and attracting foreign direct investment.
... Exibir mais + The note provides concrete policy recommendations to deepen Burundi's integration with neighboring countries, improve its trade performance and increase its competitiveness. In addition, the note gives some practical guidance regarding the implementation and sequencing of these recommendations based on Lesotho's successful experience in addressing typical trade challenges facing landlocked LDCs.
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This policy note examines the current role of clearing and forwarding agents within the international trade logistics chain in the East African Community (EAC), this note discusses policies, particularly with regards to training and education that can be enacted in order to strengthen the participation of Clearing and Forwarding (C&F) agents in the international trade logistics chain, and can help to facilitate greater flows of international trade throughout the EAC, an aspect of the logistics industry that has been relatively under-examined.
... Exibir mais + Inefficient and low quality services offered by some C&F agents, who are supposed to act as representatives of the importer, as well as occasional rent seeking behavior, can have a negative effect throughout the logistics chain, hindering the flow of international trade. In addition, this policy note considers the wider problem of the fragmented and fractured nature of the logistics chain itself, a structure that can lead to fundamental inefficiencies throughout the system.
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Business services are generally provided on a private sector basis and require a high level of skills that are usually certified. Business services include accounting, architectural, engineering, legal services, Business Process Outsourcing (BPO), Information Communication Technology (ICT), Information Communication Technology Enabled Services (ITeS), and more.
... Exibir mais + Kenya is in a unique position to export business services throughout East Africa and to the rest of the world. Kenya's recent 'ICT revolution' epitomized by the success of Safaricom has expanded mobile phone and internet access to millions of people, and Kenya's ICT services firms such as KenCall have had substantial success in the domestic as well as the international market. This policy note describes the characteristics of the professional service exporters in Kenya based on an in-depth study of 52 exporters, including their export strategies. Second, it identifies the key challenges faced by current and potential exporters of professional services. Finally, it proposes policy recommendations to address those challenges that will help establish Kenya as a desirable off shoring destination for international clients.
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