Global Value Chain II

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Browsing Global Value Chain II by Author "Zgovu, Evious"

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    Potential for Africa Continental Free Trade Area to Increase East African Community Exports to Africa
    (AERC, 2024) Zgovu, Evious; Morrissey, Oliver
    This paper provides estimates of the potential for East African Community (EAC) member countries to increase exports to the rest of Africa as the other countries reduce tariffs under the African Continental Free Trade Area (AfCFTA), using a simple approach to identify the markets (countries) and products most likely to benefit considering only growth of existing imports from the EAC. The assumption is that EAC member countries have evident export capacity in such products and markets, and that these products are unlikely to be excluded from liberalization by importing countries. The results suggest that the EAC could expand exports overall by 10-15%, largely concentrated in relatively close countries, and agriculture and resource-based products, but with basic manufactures. Relatively distant markets in North and West Africa offer reasonable potential to EAC countries, except Rwanda (concentrated on the Democratic Republic of Congo - DRC) and Tanzania (concentrated on Southern Africa). The EAC can anticipate moderate gains from AfCFTA and, by identifying the markets and products most likely to be affected, the study provides a guide to policy makers in EAC countries on sectors to target in supporting exports, including products that could target new distant markets (that include some basic manufactures). Textiles and apparel offer the best potential to engage in regional value chains.