Invest in Russia — invest in Russian regions!
All analytics

Economic Development in Africa Report 2021

Research
13 June 2022
Доклад об экономическом развитии в Африке за 2021 год
Source
Release date
06/14/2021
Open PDF

The report by UNCTAD examines how recent policy trends and practices, mainly those under the African Continental Free Trade Area, will impact prospects for more inclusive growth, given increasing inequalities both between and within countries in the region and the negative effects of the COVID-19 pandemic.

The Roscongress Foundation presents the salient points of the publication accompanied by fragments of broadcasts of relevant panel discussions from the business programme of international events held by the Roscongress Foundation.

African countries need inclusive growth to deal with inequality and the consequences of the pandemic.

On average, the proportion of households in Africa with an income or consumption level at below USD 1.9 per day (purchasing power parity) declined from 40.2 per cent in 2010 to 34.4 per cent in 2019. With regard to inequality, countries in Africa have a Gini Index ranging from 27.6 per cent (Algeria) to 63.3 per cent (South Africa). The authors of the report emphasize that the pandemic risks jeopardizing many of the growth gains made in recent years, halting the decline in poverty while exacerbating inequality. In addition, members of the African Continental Free Trade Area range from large countries to small countries and include both resource-rich and resource-poor countries, least developed countries and middle-income countries. The process of trade integration and the elimination of tariffs will thus affect these countries differently, both within and among them, and potentially create distributional effects if these asymmetries are not accounted for. A more inclusive African Continental Free Trade Area can become a beacon of continental peace, prosperity and security.

The authors of the report specify that inclusive growth includes elements of income-related inclusive growth and multidimensional inclusive growth; the former, across all segments of the population, has been inclusive (that is, growth that reduces poverty and inequality) in only 17 countries in Africa; poverty-reducing but inequality-increasing in 18 countries; and non-inclusive (that is, growth that does not reduce poverty or inequality) in 14 countries.

Video: https://roscongress.org/sessions/africa-2019-sozdavaya-novoe-kachestvo-zhizni-v-afrike-/search/#00:11:28.383

Strengthening regional trade integration could help enhance inclusive development.

Removing intra-African tariff and non-tariff barriers under the Free Trade Area could unlock new trade opportunities. Partial tariff liberalization by 2025 under the African Continental Free Trade Area is expected to increase the intra-African export potential by an additional USD 9.2 billion. The scope of the African Continental Free Trade Area for strengthening regional value chains can increase the resilience of countries in Africa in the post-pandemic period, in particular with regard to medical supplies and food products. This may also be relevant with regard to renewable energy because different countries have different energy resources and more intense trade can support the diversification of the energy mix and harness complementarities. This may be important in Africa given the growing prominence of a green growth agenda as part of post-pandemic scenarios. According to UNCTAD, to further increase the inclusivity of intra-African trade, it is also necessary to facilitate the participation of domestic and women-owned enterprises. Facilitating market entrance and reducing the costs of starting a business, as well as strengthening productive linkages between exporters and the domestic economy, are critical for more inclusive growth. Ongoing trade-related frictions, including non-tariff measures, infrastructure gaps and inadequate market information, pose particular burdens on small and medium-sized enterprises and marginalized groups. Firms experience business constraints differently and access to inputs and productive capacities is not equally distributed. Addressing the dominance of a few market actors and structural and regulatory barriers to entering domestic and foreign markets requires long-term cooperation in investment and competition policies. Moreover, some trade barriers entail fixed-cost elements and smaller actors are therefore disproportionately affected, notably with regard to non-tariff measures.

Video: https://roscongress.org/sessions/mezhdunarodnaya-torgovlya-globalizatsiya-ili-regionalizatsiya/search/#00:41:39.328

Coherent strategies and correct policy sequencing are key in delivering on the potential of the African Continental Free Trade Area Agreement.

The implementation of the African Continental Free Trade Area starts a new era of trade governance in Africa and should be considered an opportunity to undertake much needed structural reforms across the continent, to support inclusive growth and recovery in the post-pandemic period.

Some of the policy recommendations offered by UNCTAD include promoting market intelligence and efficient trade measures, ensuring that the private sector is a driver of growth, establishing integrated institutional mechanisms for implementation and monitoring, targeting technical and financial support to the least developed countries to address trade constraints, strengthening cooperation at the international and continental levels, ensuring tax justice, etc.

Video: https://roscongress.org/sessions/africa-2019-promyshlennaya-kooperatsiya-potentsialnye-tochki-rosta/search/#00:24:59.392

Gain more insights about trade and economy in the Free Trade Areas (FTA) and Trade policy sections of the Roscongress Information and Analytical System, about possible ways to stabilize the economy during a pandemic in the StayHomeEconomy section, and about the development of the African continent in the Africa section.


Anlytics on the topic

All analytics
Research
28 July 2020
Consumers and the new reality: preparing for changing customer needs, behaviors and expectations

The KPMG research is dedicated to online shopping. It describes the trends that emerge while commerce is being shifted online and provides some advices to companies that are looking for the new solutions.

Research
30 December 2019
World Development Report 2020: Trading for Development in the Age of Global Value Chains

The World Bank Group has published a flagship report about the world development in 2020. The publication studies the causes and implications of the slowdown in globalization. Also, the World Bank analysts identify a number of threats that could nullify the progress on poverty reduction achieved over the last decade.

Articles
16 July 2020
ACRA Financial Stress Index: similarities and differences between the current situation and the crises of 2008–2009 and 2014–2015

In this publication, the Analytical Credit Rating Agency (ACRA) studies dynamics of its financial stress index ACRA FSI. Analysts draw parallels between the current situation and the crises of 2008–2009 and 2014–2015.

Research
26 June 2020
COVID-19. Challenges and their impact on the transport and logistics sector

In their research, PwC experts studied the impact of COVID-19 on business activity, including in the transport and logistics sector.