Collating and analysing African trade data is an exercise fraught with difficulties. In many instances this data is not available from its primary source, and this leads to the use of so-called mirror data or data assessed by examining the mirror of the trade partner data. While this is a very good proxy, it does lend itself to some interpretational problems (such as when neither partner reports).

In addition, there are many other issues that one encounters such as transhipment of goods across boundaries, data classification differences, whether or not the costs of transport and associated costs are included in the import values, and the sensitivities associated with some goods that lead to a country not reporting the full picture (South African gold trade, for example). These difficulties persist despite organisations, such as the International Trade Centre (ITC), making great strides in improving data availability and accuracy.

This is an important issue as politicians and trade officials and practitioners rely upon accurate data for sound policy-making outcomes. The problem is that in examining trade data we find numerous examples of where data seems to disappear into a ‘black hole’. Often, as in seemingly unnatural phenomena, a logical explanation can be found but, conversely, at other times no apparently logical explanation offers itself.

The objective of this paper is to peruse African trade data and explore some of its mysteries. We appreciate that a case cannot be proved or disproved by offering examples, but we consider that the examples provided at least help to explain some of the seemingly contradictory findings from trade data. The emphasis is on intra-African trade data.

Overall, African trade data now reconciles relatively well at the big-picture level of aggregate country reporting when either direct or mirror data is used. Nevertheless, some glaring gaps remain. This applies especially to the commodity analysis, and further investigation shows that these two aspects of intra-country and commodity problems are often interrelated. However, the situation is improving, and examples of this include the reporting by South Africa of its intra-Southern African Customs Union (SACU) trade data since 2010.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

This paper provides an update on South Africa’s foreign investment position through to and including the December 2012 year with respect to the old, new and good friends of the EU and USA; the BRICs of Brazil, Russia, India and China; and Africa, respectively. The three categories of investment recorded by the South African Reserve Bank are: foreign direct investment (FDI), portfolio investment, and ‘other’ investment. Each will be examined in turn.

The data is stock data and it has been sourced directly from the South African Reserve Bank. It is the results of their survey data to assess the values of foreign assets in South Africa (liabilities resulting from inflows of foreign capital) and South African assets abroad (assets resulting from outflows of South African capital). The data is denominated in South African rands (either billion or million) and we show percentage shares to give a better perspective on the relative importance of sources and destinations in both absolute terms and relative changes.

South Africa’s total foreign liabilities are dominated by ‘old’ friends (EU and US). The ‘new’ friends are only starting to register at around the 2% level, while the ‘good’ friends of Africa have been relatively consistent at around the 5% level. Recent highlights are the big entry for new friends (China) in 2008 and some big changes from good friends in 2003 and 2004. There have also been fluctuations in the contributions from the ‘others’ or those not included as friends for this exercise. The two years of 2002 and 2008 stand out with large disinvestments from the old friends.

South Africa’s investments abroad (assets) again show that the old friends dominate as a destination. Good friends have been stable and increasing over the period while the new friends have featured from around 2006 onwards. Changes in investments for South Africa have been relatively stable, and only during 2002 was there a decline, with this decline reported for the old destinations. 

While this paper examines the ‘big picture’ only it does raise some interesting questions as to what is driving some of these recent developments. Especially important for the South African economy is the investment relationship with China, as this is the overwhelming development in the last few years. Similarly, but in a less dramatic manner, the steadily increasing South African investments in the African continent suggest than a more detailed analysis of these investments is likely to reveal some interesting stories at the firm level.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

This paper clearly reinforces the data warning outlining the dangers inherent in trying to analyse intra-African trade data. The use of mirror data, late and non-reporting and ‘vanishing’ trade has been the bane of this research; we must therefore emphasise that this paper is far from being a definitive analysis of intra-African trade. We must also emphasise, however, that the ITC is the best available source of consistent trade data and this paper represents a systematic attempt to use the available data to start shedding light on intra-African trade.

Over the last few years the aggregate intra-African trade’s (imports and exports) share of total African trade has consistently been around the 12% mark (with a high of 14% in 2009) as shares from both the European Union (EU) and the United States (US) are dramatically declining in the face of increasing Brazil, Russia, India and China (BRIC) trade.

Using the ITC direct and mirror data for imports we found that the main intra-African exporters are South Africa, Zambia, Botswana and Namibia. At the HS 2 Chapter level imports are headed by mineral fuels, ships and related equipment, general machinery, vehicles and electrical machinery, but according to the mirror data we have brought trading in precious stones and metals into the top bracket for later analysis.

By combining direct and mirror data the main intra-African exporters are South Africa, Nigeria, Côte d’Ivoire and Egypt, By HS products the main exports are fuels, ships, precious stones and metals, general machinery, vehicles, and electrical equipment.

Reconciliation of intra-African data clearly exposes the significant problems inherent in such an exercise and leaves us still seeking the truth in numerous places. There are several main data problems: (a) non-reporting where the mirror data is often used in place of direct data and, of course when neither party reports its data the mirror is non-existent; (b) the penchant for South Africa not to report gold trading and, at least until recently, poor intra-Southern African Customs Union (SACU) reporting; and (c) the suspected confusion of re-exports in at least vessels and related equipment and vehicles.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

Much of the focus of South Africa’s trading relationship with BLNS countries is on the SACU revenue-sharing formula, a formula which is based entirely upon one side and one side only of this relationship. The SACU tariff revenue pool is divided on the basis of intra-SACU imports. These imports are dominated by BLNS imports from South Africa.

The objective of this paper is to analyse the Southern African Customs Union (SACU) trading relationship and briefly discuss the tariff revenue-sharing formula before going further and examining the implications of interrelated themes in terms of regional development. Analysis has generally focused much more on South Africa’s exports to Botswana, Lesotho, Namibia and Swaziland (BLNS) for two reasons: (a) this is the dominant trading relationship and (b) the SACU tariff revenue sharing is based upon intra-SACU imports only.

We have used South African trade data sourced from the International Trade Centre (ITC) expressed in US dollars in the first section of the paper but BLNS trade data sourced from the SACU Secretariat denominated in rand in the second section.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

Regional integration remains a prominent policy objective for Africa. Its emphasis at continental level was confirmed by the decision of the members of the African Union to establish a Continental Free Trade Area (CFTA) in accordance to the Abuja Treaty. While this is an appealing idea, it is fraught with challenges. Chief of these is the fact that among the existing regional integration communities in Africa, very few have met their commitments by implementing their treaties and protocols. Furthermore, not all countries are signatories to regional trade protocols and even after signing the protocols, trade tariffs and non-tariff barriers still continue to impede intraregional trade.

While challenges exist, what is critical to note is the fact that liberalisation is continuing in Africa, albeit at different rates among different RECs. The objective of this study is to assess the state of liberalisation among African countries both at the multilateral level and at the regional level with the aim of highlighting the challenges that the attainment of a CFTA will face in achieving its goal.

The paper is organised as follows: We begin by looking at the methodology and data concerns in analysing tariff data. This is followed by a section presenting the status of tariff regimes and then we focus on issues related to the achievement of the CFTA itself. Conclusions are then presented. As 53 countries are analysed and in some instances data is not available, we have split the analysis and focused more on the main RECs recognised by the AU for the purposes of this paper. In our view, focusing on these will give clear indications where the gaps exist that require countries to make concessions if a CFTA is to be achieved.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

Recent tralac research has shown that since 2001 Africa’s overall trade with the old friends (the United States and the European Union in particular) has dramatically declined while, conversely, that with the new friends (BRICs) is increasing. The intra-African share has remained consistent. While India’s involvement with Africa is less dramatic than China’s, its increasing profile mirrors China’s rise although this is happening with a less public profile. This paper examines India’s global profile and places the Indian rise in an international perspective. 

In the first section we discuss India’s rise in international trade. The question remains whether this rise will be sustained and indeed what the future may hold. The second section seeks to address these questions and moves beyond simple linear extrapolations by employing a comparative static general equilibrium model.

This model takes various known and/or best estimates of macroeconomic variables, shocks and other developments into account to give a projection of the world economy up until 2025. Key assumptions include strong growth from Asian economies and to a slightly lesser extent growth in Africa, and moderate growth in the older economies of the US and Europe. We make use of the pre-release Version 9 Global Trade Analysis Project (GTAP) database with a base year of 2011. We consider that the results for 2025 are the best estimates for likely trade patterns between India and Africa, the EU, the US, China and the rest of the world calculated as the residual. The emphasis is on trade shares and shifts in these shares and we use an aggregation of the GTAP sectors for agriculture, natural resources, manufacturing and service sectors.

Our projections suggest that Indian exports will see declining domestic shares of agriculture and natural resources, while in the crucial textiles, clothing and leather sector exports increase but at a modest rate. In the traditional manufacturing sectors Indian exports increase significantly, as do services. It is projected that the percentage of Indian export shares will decline to the US and China while slightly increasing to Africa and the rest of the world.

For imports it is projected that India will increase its demand for particularly agricultural products and to a lesser extent natural resources and manufacturing imports. Overall, the projection is that again there will be a sharp decline in imports from the EU and a lesser decline from the US, but an increase from both Africa and the rest of the world of over two percentage points.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

Services are playing an increasingly important role in the modern economy, but while economists and policy makers focus on trade in merchandise goods they tend to spend significantly less time examining the services trade. The lack of detailed information as well as the complexities of the embodied services components, such as brand marketing within manufactures, makes it hard to quantify the international trade in services.

In this paper we present a preliminary examination which could be referred to as the standard services profile of African countries and, in particular, services trade for these countries. We note that the paucity of data almost always precludes a bilateral examination, so our examination is limited to the broader profile. The data source is mostly the International Trade Centre (ITC) database, and we have reported on data through to and including 2012 and, where practical, 2013.

As a generalisation, services comprise between 60% and 70% plus of the Gross Domestic Product (GDP) in the developed economies; the Sub-Saharan African share increased in recent years to over 60% in 2013. Most, but not all, of the African economies report an increasing share of services in their economies.

Africa is a net debtor on services trade, with global imports rising from 2.8% in the early years to just over 4% in the latter period, while Africa’s export share is lower and perhaps ever marginally declining. Overall, Africa imports $170 billion in services from the world and exports just $97.4 billion. Egypt is the largest individual trader, although South Africa just verges on Egypt for service imports.

The imbalances are interesting in that some countries such as Morocco and Tunisia export more than they import, while for others, and in particular the oil-exporters of Algeria, Nigeria and Angola, imports are substantially higher than exports. Examining services trade as represented by combined services imports and exports expressed as a percentage of GDP shows that Sub-Saharan Africa is very close to the global average.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

The objective of this paper is to provide information on Nigeria and its merchandise trading profile and regime. Nigeria is a middle-income country with a Gross Domestic Product (GDP) of around $265 billion, a figure the same as Egypt’s but below South Africa’s $385 billion.

However, in early 2014 Nigeria rebased its GDP calculations for new estimates that put Nigeria’s GDP in 2013 at $510 billion, an 89% increase on the estimates at that time. The revision means Nigeria leapfrogs South Africa to be Africa’s largest economy. It rises to 24th in the list of the world’s big economies, behind Poland and Norway and ahead of Belgium and Taiwan.

Oil-rich Nigeria has been hobbled by political instability, corruption, inadequate infrastructure, and poor macroeconomic management, but in 2008 it began pursuing economic reforms. Nigeria’s former military rulers failed to diversify the economy away from its over-dependence on the capital-intensive oil sector, which provides 95% of foreign exchange earnings and about 80% of budgetary revenues.

However, since 2008 the government has begun to show the political will to implement the market-oriented reforms urged by the International Monetary Fund (IMF), such as modernising the banking system, removing subsidies, and resolving regional disputes over the distribution of earnings from the oil industry. GDP rose strongly in 2007-12 because of growth in non-oil sectors and robust global crude oil prices. Nigeria ranks tenth in the world for oil production and eighth as an oil exporter, leading Africa in both production and exports.

The 2012 World Trade Organisation (WTO) trade data shows that during 2012 exports were valued at $115,000 million while imports were a much lower $51 000 million. Exports increased by 12% during the 2005-2012 period while imports increased by a slightly higher 14%. In 2012 the annual changes were reversed and exports had a 1% increase while imports decreased by 9%. Oil products completely dominate exports while manufacturing products equally dominate the imports.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

The World Bank reports that Ghana is a medium sized country in west Africa, with a land area of around the same size as the United Kingdom or Uganda. The reported population in 2012 was around 25 million (the same as Mozambique and a bit more than Australia), giving the country a population density of 109 inhabitants/km². This density is very similar to Hungary and Cuba. The Bank also reports Ghana as being a lower middle income country with a GDP of around $40 billion, a figure sandwiched between Kenya and Ethiopia. This leads into a Gross National Income (GNI) average of $1,550 per capita, similar to that in India, Vietnam and Lesotho.

The Food and Agricultural Organisation (FAO) reports that some 68% and 32% living in the rural and urban areas respectively. About 52% of the labour force is engaged in agriculture, 29% in services and 19% in industry. Approximately 39% of farm labour force is women. Agriculture contributes 54% of Ghana’s GDP and accounts for over 40% of export earnings while at the same time providing over 90% of the food needs of the country. Ghana’s agriculture is predominantly smallholder, traditional and rain-fed.

Farming systems vary with agro-ecological zones, although staple crops are often mixed-cropped while cash crops are usually monocropped. In the forest zone the tree crops of cocoa, oil palm, coffee and rubber are importance, along with the food crops of maize, plantain, cocoyam and cassava. The middle belt is mainly maize, legumes, cocoyam or yam, with tobacco and cotton being the main cash crops. Cotton and tobacco are also important in the northern sector, where the food crops are mainly sorghum, maize, millet, cowpeas, groundnuts and yam. Rice is important in all the zones. Livestock farming is associated with crop farming, with poultry in the south, cattle production in the Savannah zones and sheep and goat production widespread.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.

Much of the focus for African industrialisation must be on the clothing sector, as this is the classic low-tech and low-wage sector for an industrial base to assist an economy with limited industrial capacity (as in Africa excluding South Africa). We have defined clothing as all the products included in HS Chapters 61, 62 and 63, as these encompass most of what may be construed as clothing.

Outside South Africa, the ITC data shows that for the 2011 and 2012 years (the only complete years providing aggregate African exports) these three chapters represented 1.94% and 1.73% of total African exports to the world. While this pales beside the 69.2% and 70.8% export share from minerals and fuels for the comparable years, it nonetheless contributes a significant portion of the nonagricultural, nonminerals and fuel components of African exports.

This paper concentrates upon the export profile from the continent as well as provide a closer examination from the South African perspective. We note at the outset that analysis of the South African trade and consequently intra-Southern African Customs Union (SACU) trade is hampered by the under- or even non-reporting of the intra-SACU trade; however, we will try to address this problem.

The paper begins with the ‘big picture’, namely trade with the new, old and good friends for both exports and imports before focusing on the individual profiles of the main countries and examining South Africa’s trade in more detail. It is well known that China dominates the clothing import market for the continent while the United States (US) and the European Union (EU) are generally thought of as the major export markets from the continent. However, we would like to test this initial hypothesis against an examination of the intra-African trade to assess where the ‘good friends’ feature.

Our main data sources include the International Trade Centre (ITC), augmented by the commercially obtainable Global Trade Atlas (GTA) trade data for South Africa. Generally, our starting year is 2001 although aggregate African data is only available for 2011 and 2012. Some data is available for 2013 but as it is not, at the date of publication, complete we use it cautiously. In addition, we note that sometimes our data sources do not reconcile and recognise that this is a generic problem when dealing with African trade data. This is complicated by the necessity to often use mirror data (data that is taken from the ‘mirror’ of the trading partner rather than the actual trade data of the country in question).

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed remain solely those of the authors and do not purport to reflect the views of tralac.