The role of African countries in international trade has significantly declined since the late 1980’s till present. While other developing economies of same era in Asia and Latin America have experienced continued economic growth, the competitiveness of African nations in international trade remains low. According to ICTSD, Africa’s participation in International Trade is presently less than 2% while the ITC Trade Map indicates a decline in total value of African exports from $577,900 in 2013 to $108,914 in 2017. The World Bank estimates a trade income loss of $70 billion annually, an amount five times more than the $13 billion in annual aid flows to the continent. Though a lack of diversification, poor infrastructure, corruption, and a volatile political climate are factors affecting Africa’s domestic market, the marginalization of African markets by non-binding international regulations, lackadaisical WTO negotiators, commodity bans and high tariffs from developed economies have been major contributors to Africa’s minimal participation in international trade.
Africa and The WTO
African nations represent about 26 percent of WTO member states; a significant enough number to influence decision-making. However, this has made little impact in negotiating deals favourable to the continent. The Uruguay Round negotiations (1986-1993) and Doha Round launched in 2001 held a lot of promise for African nations but were ultimately choked by conflicting interest and a lack of true compromise by developed nations to allow African nations flourish in international trade.
The main objective of the Doha Round negotiations was to improve the trading prospects of developing nations through the introduction of lower trade barriers and revised trade rules. However, several countries claimed that the Doha Declaration on TRIPS contravened national legislation and insisted the principle of reciprocity be applied in order not to loose monopoly benefits from tariffs on its imports. Emerging economies such as China and India argued that it was unfair to expect they would minimize trade measures equally as more developed nations when their social security and safety systems where less developed.
Since Doha, the Nairobi Ministerial Conference seems to have attained the most benefits for Africa and other Least Developed Nations (LDCs). In agriculture, export subsidies in developed economies was outlawed, most significantly on Cotton, while LDC’s are expected to do so by 2023 providing a leveled playing field.
Role of African States
Reports have criticized Africa for displaying little to no determination in furthering their international trade goals and suggest this as the major reason they are overlooked by the WTO. In Bali 2013, for instance, Africa failed to defend and buttress the needs they had pointed out at consultations while India demanded and was granted a tailored agreement to protect it’s interest on both food security and trade facilitation. Truly, most agreements reached at the Ministerial Conferences would benefit African nations if they were positioned higher in the international value chains. The International Center for Trade and Sustainable Development, have identified Africa as a supplier of basic commodities and raw materials and in very limited quantities, placing it at the bottom of the chain. Therefore, agreements such as the WTO Information Technology Agreement to eliminate tariffs on various products would benefit Africa if it were active in the ICT market, pointing out the need for Africa to diversify.
There is also need to enhance Africa’s trade related infrastructure; air, road and communication facilities. A study taken by the International Food Policy Research Institute reveals that trade related infrastructure determines Africa’s trade flows; where these infrastructures are improved there are higher returns.
If Africa wishes to reap the benefits of membership in International Organisations they must be willing to participate fully and actively. They must attend meetings regularly, contribute to agenda’s at meetings, submit proposals that promote Africa’s trade interest, chair regular bodies and sub-committees of the WTO and initiate disputes at the WTO DSB against actions that unfairly reduce their participation in international trade. There must be both quantitative and qualitative representation of African Nations in Geneva and members must enhance effectiveness through commitment and knowledge of WTO operations.