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Morley, David - The Cambridge introduction to creative writing (2011) - libgen.li
| t pe rce n t a. Leading African exporters for exports to China and India to China to India from China from India b. Leading African importers for imports from China and India pe rce n t pe rce n t 90% 68% Guinea-Bissau 0 10 20 30 40 50 60 70 80 90 rest of Africa Côte d’Ivoire Guinea Congo, DR Liberia Mauritius Madagascar Ethiopia Tanzania Angola Kenya Togo Ghana Benin Sudan Nigeria South Africa 10 20 30 40 50 60 70 80 90 100 Senegal Uganda Mozambique Congo, Rep. 85% Source: UN COMTRADE. 02-Chap2:02-Chap2 10/9/06 2:41 PM Page 85 86 AFRICA ’ S SILK ROAD : CHINA AND INDIA ’ S NEW ECONOMIC FRONTIER plausible explanation for this difference is the historical ties India has with African countries from the colonial period, which have created a large Indian diaspora population across the African continent. Strong ethnic networks are one of the key characteristics of the private sector in African countries. 13 Ethnic networks should work to facilitate trade activities between India and African countries. 14 Earlier, it was shown that, although African exports to Asia as a whole do not exhibit a significant pattern of product diversification, intersectoral com- plementarities between Africa and Asia do exist. Similar intersectoral com- plementarities seem to exist between Africa and China or India. This is true in a general context of Africa as a large supplier of raw materials, including energy resources, and China and India being suppliers of manufactured products to African countries. This pattern is largely driven by factor endowments. The rich resource endowment in Africa provides a natural comparative advantage in raw materials and resource-based products. China and India, on the other hand, have a rich stock of skilled labor compared to Africa and thus have a comparative advantage in manufactured products. 15 The endowment-based theory of comparative advantage provides a simple but intuitive framework for understanding the trade patterns of African countries. In light of Africa’s scarcity inhuman capital and rich natural resource base, the theory would suggest that it is not economically efficient for African countries to push for manufactured exports. At the same time there is a belief that, with greater trade between Africa and the growing industrial giants China and India, Africa’s concentration on primary commodity exports will, if anything, increase, undoing Africa’s efforts to promote manufactured exports. However, manufactured exports from Africa to China and India are increasing rather significantly (figure Is this a sign of growing complementarities between Africa and China and India Three aspects may show positive shifts in complementarities between Africa and China and India. The first concerns the prospects for resource-based, value-added manufacturing exports. There is already evidence of Chinese and Indian imports of resource-based manufactured products. African countries could increase their manufactured exports to China and India based on the existing exports of raw materials. However, there is always a limit to growth based on horizontal diversification. African countries want to avoid being trapped as a resource basket for rapidly industrializing economies, such as China and India they also want to realize dynamic efficiency gains by extracting value from their endowed 02-Chap2:02-Chap2 10/9/06 2:41 PM Page 86 PERFORMANCE AND PATTERNS OF AFRICAN - ASIAN TRADE AND INVESTMENT FLOWS 87 resources. Natural resources provide a quick launching base for African countries to generate value-added activities. Although still limited to a few countries such as South Africa and Nigeria, resource-based manufactured products such as aluminum, iron, and steel appear among the leading exports to China and India. India’s large exports of diamonds, which are likely due to diamond polish work in India using raw diamonds from Africa, raise a clear example of how added processing work could be retained in Africa, possibly by inviting Indian investment. The second aspect concerns the prospects for broader participation in global value chains. As discussed in detail in chapter 6, there are growing vertical complementarities along value chains between Africa and China and India. Among the top 20 African exports and imports with China and India, there are clear complementarities between African countries and China and India in the cotton-textile-garment value chain (see tables A through 2A.7). Raw material (cotton) is supplied by West African countries to China and India, and intermediate materials (fabrics) are supplied by China and India to apparel producers in Mauritius, Nigeria, South Africa, and other countries in Sub-Saharan Africa. Chapter 6 addresses the possibility of African producers participating in global network trade in the apparel sector. FIGURE 2.19 Download 5.17 Mb. Share with your friends:
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