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Have transport costs contributed to the relative decline of sub-Saharan African exports? Some preliminary empirical evidence, Volume 1

Author:	Amjadi, Azita; Yeats, Alexander J.;	Collection Title:	Policy, Research working paper ; no. WPS 1559
Country:	Africa;	Date Stored:	2001/04/21
Document Date:	1995/12/31	Document Type:	Policy Research Working Paper
Language:	English	Major Sector:	(Historic)Economic Policy
Region:	Africa	Report Number:	WPS1559
Sub Sectors:	Trade	SubTopics:	Rural Roads & Transport; Common Carriers Industry; Environmental Economics & Policies; Economic Theory & Research; Free Trade; Transport and Trade Logistics
Volume No:	1

Summary: From the mid-1950s to 1990, sub-Saharan Africa's share of global exports fell from 3.1 to under 1.2 percent, a decline that implies associated export earning losses of about $65 billion annually. Previous studies show that foreign trade barriers do not account for this poor performance. Indeed, African exports enjoy OECD tariff preferences. In the sub-Saharan African countries, too high a proportion of foreign exchange earnings is paying for Africa's high export transport costs. The authors demonstrate that relatively high transportation costs - especially for processed products - often place African exporters at a serious competitive disadvantage. African countries must use a far larger share of their foreign exchange earnings to pay for international transport services than other developing countries do - and the relative importance of those payments has been increasing. Why are Africa's transport costs so high? Ill-advised policies on the part of some African governments seem to have played a role, as their cargo reservation policies produced high "rents" for lines that have been shielded from the effects of competition. The failure to maintain or improve port and transport infrastructure has also played a role.


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