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Building capacity to help Africa trade better

Topics publications: Technology and innovation

Working Papers

The potential role for drones in Africa’s value chains

Industrialisation and the emergence of new technologies, such as the Internet, have improved value chain efficiency but also increased the complexity of production linkages. Within the context of Africa, the functioning of value chains tends to be more complex due to the lack of transport (roads, railways, ports, and airports) and other infrastructure. With the rise of the Fourth Industrial Revolution (FIR) and the development of newer technologies, specifically drones, artificial intelligence, big data, mobile devices and 3-D printing, the performance of value chains stands to be improved. These technologies represent both significant opportunities, but also challenges to countries in terms of the educational, financial, and infrastructural developments required for the effective integration of these technologies.

The potential role of drones associated with the rise of digital business in Africa and the accompanying decrease in the production costs may shape this aspiration into reality. Amongst the technologies of the FIR, drones may offer a new tool to the logistics industry and may be game changers for managers in the African value chain. This paper will provide a short definition of drones and Unmanned Aerial Vehicles (UAVs) and will demonstrate how this tool could fit into and work within the African value chain despite the current challenges faced by the region. Furthermore, this paper will demonstrate via three case studies that drone technology could be accessible to African states and could bring benefits to African societies through humanitarian, business, and public services.


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 author and do not purport to reflect the views of tralac.

Working Papers

From Telephones to Smartphones – A look at the Harmonized System: Case study of the Samsung Case

The seventh edition of the ‘Harmonized Commodity Description and Coding System’ of the World Customs Organisation (WCO) becomes operational on 1 January 2022. Since its inception in 1988, the ‘new’ HS has been revised every five years, with the latest edition, HS 2022, being approved by the WCO Council at the end of June 2019. It stands to the credit of the HS, given its extensive scope and application, that courts and tribunals are not overwhelmed by classification disputes.

The HS is best described by examples. In mid-2017, Samsung South Africa applied to the Commissioner of the South African Revenue Service for a tariff determination for its Samsung Galaxy S7 ‘multi-functional device’. Two HS codes (or ‘tariff headings’ for customs purposes) were involved. Following interactions between Samsung and the Commissioner, the Galaxy S7 was recognised as a ‘smart device’ classifiable under subheading 8517.62.90 (‘Machines for the reception, conversion and transmission or regeneration of voice, images or other data, including switching and routing apparatus – Other’). However, after notifying Samsung in November 2017, the Commissioner withdrew the determination and replaced it with a classification under subheading 8517.12.10 (‘Telephone sets, including telephones for cellular networks or for other wireless networks … Designed for use when carried in the hand or on the person’). This reclassification led to Samsung’s appeal to the High Court.

The Court followed a trodden path in identifying the proper classification, turning ultimately to the HS headings and subheadings. The basic question was whether the Samsung Galaxy S7 was a ‘telephone’ as maintained by the Commissioner or the ‘machine’ (or ‘apparatus’) Samsung claimed it to be. The Court was finally not convinced that the functions of the Galaxy S7 ‘straddle between tariff heading 8517.1 (‘Telephone sets, including telephones for cellular networks or for other wireless networks’) and tariff heading 8517.6’ (Other apparatus for transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network). In future, therefore, the ever-present smartphone will have its own dedicated six-digit tariff heading, 8517.13.


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 author and do not purport to reflect the views of tralac.

Trade Briefs

Realising the One African Services Market through the AfCFTA

Start of trade under the preferential terms of the African Continental Free Trade Area (AfCFTA) was announced on 1 January 2021, whilst negotiations to finalise outstanding issues on Phase 1 topics of good and services are to be concluded in June 2021. The creation of the One African Market for goods is a long-term endeavour; there is a 5-year timeline for non-least developed countries and 10 years for least developed countries to eliminate 90 per cent of tariff lines. For services, progressive liberalisation is envisaged through successive rounds of negotiation’, with substantial liberalisation as the stated threshold. These simple differences in the format and expression of ambition – one numerical and one qualitative, express a fundamental disparity in approach towards the realisation and assessment of liberalisation of trade of goods and services under the AfCFTA.


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 author and do not purport to reflect the views of tralac.

Trade Briefs

Tech Disruption in Africa: Assessing the Potential of the Digital Labour Platform Sector

Digital labour platforms are applications that run on computers and smart devices and are able to facilitate new online markets for services of diverse types. These platforms disrupt existing markets in the sense that they replace prior ways of doing business, but they also create new modes of market behaviour, make new markets and even create new services.

This Trade Brief recognises the potential importance of digital labour platforms for the developing world, especially Africa, where self-employment and micro entrepreneurial activity is more important than perhaps anywhere else in the world. The brief firstly outlines the dimensions of the global market and then attempts to estimate the size of the actual and the potential digital labour market in Africa. The brief closes with an extended conclusion that covers remaining challenges and policy recommendations.


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 author and do not purport to reflect the views of tralac.

Trade in the Digital Economy: a tralac collection

At any given moment, international trade is being transacted across Africa. The supermarket buyer emails the supplier she met at a recent trade show to place a sample order. The car manufacturer uses the proprietary supply chain software for their company to obtain more seatbelts for the factory.  The informal cross-border trader WhatsApps her customers for today’s orders. The farmer checks the weather app. A truck driver uses an online map to navigate a new route. A shipper secures warehouse facilities using the online booking system of a logistics firm. A customs agent processes a shipment of goods using ASYCUDA. A migrant mine worker sends money home to his family... and so on.

The wheels of international trade are powered by the Internet. From the smallest informal trade to a major supply agreement, contracts are transacted online; whether via email, e-commerce store, or digital platform. Any formal trade relies on the Internet for implementation – financing, documentation and logistics are all digitally driven, and becoming more and more so. Whether it is an emailed order, an online purchase, or merely the financial arrangements behind the transaction, the Internet will inevitably be used in conducting international trade.

This is not the future; it is not some hazy tomorrow that we cannot predict. This is the current reality of trade, even on a continent where connectivity lags and digital literacy is low by international standards. Digitalisation will be an inevitable part of trade in 2020 and beyond.

There are huge opportunities for digitalisation to increase and improve Africa’s trade environment. It is crucial to the success of the African Continental Free Trade Area (AfCFTA) that the reality of today’s digital economy is recognised and reflected. The AfCFTA Agreement itself has a role to play. Although not shaped as the kind of 21st century agreement that would provide a rules-based framework for the digital economy, there are areas, still to be negotiated, that have potential to shape the free trade area in a more digital-friendly way.

More importantly, the AfCFTA is not just a free trade agreement, it is a flagship project of the African Union (AU), situated within Agenda 2063, Africa’s framework for structural transformation. This means that the development of the continental free trade area need not rely only on the text of the AfCFTA Agreement but will be supported by a suite of other Agenda 2063 initiatives. It is through these initiatives that African Union (AU) members have the best chance and the most promising opportunities to create a free trade area that does not stand in the way of the digitisation of the economy and encourages trade and economic development within the digital economy.

The trade-related benefits to be derived from the digitalisation of the economy are well known, but bear repeating. In particular, our work suggests digitalisation can enable e-commerce; reduce transaction costs;  reduce barriers to cross-border trade; automate production, thereby improving efficiency and reducing costs; and improve logistics. In addition, digitalisation is transforming how we trade in services – from offshoring, to cloud services, to online outsourcing – the Internet has made all kinds of new services trade possible. E-commerce and digitalisation particularly offer opportunities for marginalised groups, such as young people, rural citizens and women to more easily engage in the economy – but policies are needed to ensure that access gaps are narrowed.

This volume brings together tralac’s work over the past five years (updated where necessary) on the digital economy, e-commerce, information communication technology and related developments. We present data on the current state of the digital economy in Africa; identify some of the most important interventions for catch up; examine some of the key trade policy issues arising from digitalisation; and offer policy recommendations for making the most of this fundamental economic and social shift.


© 2020 tralac, the Australian Government and the Government of Sweden

All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages.

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged. All views and opinions expressed herein remain solely those of the author(s).

Trade in the Digital Economy: A tralac guide

This booklet provides a handy guide on e-commerce, the digital economy and trade.

The digitalisation of the economy requires new ways of thinking about competition, intellectual property, taxation, industrial policy, privacy, cybersecurity, the labour market, immigration and skills and, of course trade.

The wheels of international trade are powered by the internet. From the smallest informal trade to a major supply agreement, contracts are transacted online; whether via email, e-commerce store, or digital platform. Any formal trade relies on the internet for implementation – financing, documentation and logistics are all digitally driven, and be- coming more and more so. Whether it is an emailed order, an online purchase, or merely the financial arrangements behind the transaction, the internet will inevitably be used in conducting international trade.

Digitisation has contributed to a changing trade environment in many ways – facilitating multinational value chains, enabling the rise of the micro-multinational and giving us new tradeable goods and services. It is also blurring the traditional boundaries between goods and services, blurring the boundaries between jurisdictions and bringing into question the way our legal and regulatory infrastructure operates at national, regional and global levels. The digital permeates every aspect of trade – from agriculture to clothing, from manufactured goods to business services.

Download:  pdf Trade in the digital economy: a tralac guide - March 2020 (6.46 MB)

Readers are encouraged to quote and reproduce this material for educational, non-profit purposes, provided the source is acknowledged.

Working Papers

ICTs Services Development and Trade: How Africa Can Benefit (2020 Update)

The pace of development of Information and Communication Technologies (ICTs) has been unlike any industry development hitherto experienced. The nature of the industry is such that it’s ‘futurists’ are shown to be accurate or not within just a few years. The rate of venture capital investment into this sector also outstrips any other, as investors rush to discover and buy into the next Google, Facebook or Uber.

Unlike manufacturing or mining, investment into ICTs can likewise be shown to yield returns relatively quickly. As modern economies shift further and further towards a service production orientation rather than a manufacturing one, new modes develop for service delivery and trade extends far beyond national borders. These developments hold many opportunities for the developing nations of Africa, but ones that need to be seized and acted decisively on.

This paper examines services made possible by new Information and Communication Technologies (ICTs) that are capable of being domestically and internationally traded. The emphasis is on the implications for African economies, as a unique subset of the emerging economy group. This paper is an update of a paper by the same name, published in 2015[1]. In this updated version we have updated data and, in some cases, used alternative data where the original source was no longer available. The content has also been updated to reflect developments since the publishing of the original data. Therefore, in the main body of the paper, the conclusion and the summary, updated developments are included in the analysis to bring the reader fully up to date as at January of 2020.


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 author and do not purport to reflect the views of tralac.


[1] Stuart, J. (2015). ICTs Services Development and Trade: How Africa Can Benefit. tralac Working Paper. Available https://www.tralac.org/publications/article/8049-icts-services-development-and-trade-how-africa-can-benefit.html

Trade Briefs

South African Mining and the African Continental Free Trade Agreement: South Africa’s exports of Mining Equipment, Technology and Services

The African Continental Free Trade Agreement (AfCFTA) was signed by 44 AU member states in 2018 and came into force in May 2019 after being ratified by 22 member states – the requisite number of entry into force.

Phase 1 of the AfCFTA – the various protocols on trade in goods and services and dispute settlement procedures with associated protocols – were signed (by 44 countries) last year. But much remains to be negotiated including schedules of tariff concessions, rules of origin and specific commitments in services and all of Phase 2 – the protocols on Competition Policy, Intellectual Property and Investment. Observers have pointed out that while most of the debate focuses on tariffs, it is key not to forget services. Not only do they make a key contribution to manufacturing value chains but also play a key role in integration and trade.

Mining Services do however seem to be somewhat forgotten in this process. Commentaries on the AfCFTA and services focus directly on the service sector itself, as defined in the national accounts, and on its relationship to manufacturing value chains. The multiple linkages into mining tend to be ignored.


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 author and do not purport to reflect the views of tralac.

Trade Briefs

Africa in the Digital Economy: Update

The digital economy is now the economy. This refers to the permeation of digital technologies into practically all spheres of business, finance, trade, education and government. While Africa initially lagged behind the developing world in adopting technology and migrating commerce modes to the new digital forms, in the last several years Africa has taken several leaps forward.

This Trade Brief provides an update on the situation of Africa’s progress in assimilating into the global digital economy, addressing the most pressing current challenges and reviewing several of the most exciting current initiatives underway.

Although many challenges remain, much progress has been made over the space of a few years in the mid 2010s. The digital economy, and especially e-commerce, offer a means not only for greatly extending Africa’s trade with the rest of the world, but also trade within the continent. Never before have so many initiatives been in place with the goal of both digitalising Africa’s trade and bringing African markets closer together.


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 author and do not purport to reflect the views of tralac.

Working Papers

The Rising Potential of e-Commerce for Trade and Development in Africa

The world economy has changed at a faster pace in the last thirty years than at any time in history. The mid-1990s brought on the so-called ‘information age’ and the age of the world wide web/the Internet and the myriad of services that it makes possible. Before the Internet existed, services as a proportion of output, had been growing for the developed world, but the Internet era saw this growth accelerate as services became both wider and deeper in their application.

A third dynamic also came into being in the proliferation of services – the creation of entirely new services and their inevitable role in disrupting existing sectors. Services such as centralised ride-hailing, payments gateways, retail portals and collaborative platforms showed that the Internet was not just useful in extending the definitions of commerce, but also of many other aspects of social interaction.

This paper examines the role of electronic commerce (e-commerce) and related Information and Communication Technology services (ICTs) in the furthering of trade and development in Africa. The paper begins with a discussion of how ICTs can drive development through creating new, accessible models of trade. Both the types of services and the devices that are required to access them are discussed, as well as the roles of mobile money and e-commerce platforms.

The second component of the paper entails extensive visualisation of a set of data for the main regions of the globe, the African regional economic communities (RECs) and the individual African countries as members of the RECs. The analysis examines readiness for business-to-consumer (B2C) and business-to-business (B2B) electronic trade, as well as indicators of overall Internet penetration, technology adoption, postal reliability and credit card uptake. Depending on the specific challenges faced by a grouping or country, recommendations are made and summarised again in the conclusion to the paper.


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 author and do not purport to reflect the views of tralac.

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