Are African RECs Trade-Enhancing? A Panel Data Analysis

Working Papers

Are African RECs Trade-Enhancing? A Panel Data Analysis

Are African RECs Trade-Enhancing? A Panel Data Analysis

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This paper employs both informal and formal analysis of panel trade and tariff data to determine the extent to which the gaining of preferential access to a market actually leads to increased trade volumes as a direct result. The two PTAs analysed are the EAC and the SADC, with imports into Uganda, from two new preferential trade partners; and South Africa, from six new preferential trade partners, the subjects of analysis. In both cases, the countries entering into preferential trade with an existing member of the PTA show eventually rising trade volumes directly as a consequence of acquired preferential access.

The lesson for the AfCFTA is that the rhetoric and the action have to align: to boost intra-African trade, preferential access has to be broadened within Africa and this requires intent. In addition, policy action that goes beyond narrow tariff liberalisation is also required.


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