Africa's Silk Road Broadman, Harry G; Isik, Gozde
2006, 11-02-2006, 2007
eBook, Book
Open access
China and India's new-found interest in trade and investment with Africa - home to 300 million of the globe's poorest people and the world's most formidable development challenge - presents a ...significant opportunity for growth and integration of the Sub-Saharan continent into the global economy. Africa's Silk Road finds that China and India's South-South commerce with Africa is about far more than natural resources, opening the way for Africa to become a processor of commodities and a competitive supplier of goods and services to these countries - a major departure from its long established relations with the North. A growing number of Chinese and Indian businesses active in Africa operate on a global scale, work with world-class technologies, produce products and services according to the most demanding standards, and foster the integration of African businesses into advanced markets. There are significant imbalances, however, in these emerging commercial relationships. These can be addressed through a series of reforms in all countries:"At-the-border" reforms, such as elimination of China and India's escalating tariffs on Africa's leading exports, and elimination of Africa's tariffs on certain inputs that make exports uncompetitive "Behind-the-border" reforms in Africa, to unleash competitive market forces and strengthen its basic market institutions "Between-the-border" improvements in trade facilitation mechanisms to decrease transactions costs Reforms that leverage linkages between investment and trade, to allow African businesses to participate in global production networks that investments by Chinese and Indian firms can generate.
As the world marketplace becomes ever more globalized, much is at stake for the prosperity of hundreds of millions of people in Europe and Central Asia as the regions transition process continues ...through its second decade. Understanding the underlying dynamics shaping the contours and most salient impacts of international integration that have emergedand likely to emerge prospectivelyin the region is thus a crucial challenge for the medium term economic development agenda, not only for policymakers in the countries on themselves, but also for their trading partners, the international financial institutions, the donor community and the future of the world trading system as a whole. This book addresses this challenge.
The main objective of this report is to help policymakers in the Caribbean design an agenda of policy actions to accelerate trade integration and growth, and to reduce poverty. Each part of the ...report focuses on a key question and provides an in-depth analysis of the issues raised, laying the foundations for policy recommendations described in the last chapter of the report. Part I asks whether the Caribbean's economic and trade system are sound enough to sustain the new era of its global trade relations. Part II addresses the opportunities and challenges that the new trade environment offers to the Caribbean. Part III assesses the impact of the recently-negotiated Economic Partnership Agreement on growth and poverty reduction using two types of macroeconomic models. The report concludes with policy priorities for accelerating Caribbean integration into the world economy and for reaping the benefits of global competition.
The literature measuring the impact of Preferential Trade Agreements (PTA) and WTO membership on trade flows has produced remarkably diverse results. Rose's (2004) seminal paper reports a range of ...specifications that show no WTO effects, but Subramanian and Wei (2007) contend that he does not fully control for multilateral resistance (which could bias WTO estimates). Subramanian and Wei (2007) address multilateral resistance comprehensively to report strong WTO trade effects for industrialized countries but do not account for unobserved bilateral heterogeneity (which could inflate WTO estimates). We unify these two approaches by accounting for both multilateral resistance and unobserved bilateral heterogeneity, while also allowing for individual trade effects of PTAs. WTO effects vanish and remain insignificant throughout once multilateral resistance, unobserved bilateral heterogeneity, and individual PTA effects are introduced. The result is robust to the use of alternative definitions and coding conventions for WTO membership that have been employed by Rose (2004), Tomz et al. (2007), or by Subramanian and Wei's (2007).
