Regional Integration of Agricultural Trade in Southern Africa : Infatuation or Real Need?

Abstract

The potential benefit of several regional integration initiatives undertook by African countries in recent years is a contentious issue that is continuously being debated. This article assesses the impact of a free trade agreement between member countries of the Southern African Development Community on agriculture. Findings show negative welfare results for regional importers because of the increased imports from inefficient regional producers, who are the major beneficiaries of the agreement. To enhance the benefits gained, the region should implement regional policies beyond trade arrangements, such as those enhancing investment, agricultural productivity, and product diversification.

Potential impacts of free trade areas and common currency on sustainable agricultural export in Africa

“…More specifically, 10% improvement in the level of development of trade partners improved agricultural export by 0.34, keeping other factors constant. This in agreement with the view of Nin‐Pratt and Diao (2014) that implementation in regional policies beyond free trade agreement has the tendency of improving agricultural export. The result supports the finding of Butkus et al (2018) in the case of European Union countries.…”

“…Chances are that countries that have a comparative advantage in agriculture will benefit more from such arrangements. In a further study, Nin‐Pratt and Diao (2014) investigate the effect of the free trade agreement on agriculture in the Southern African Community in Agriculture and found negative welfare effect. It was argued that the implementation of regional policies beyond free trade agreements tends to propel agricultural productivity and export.…”

Modeling the Impact of Non-Tariff Barriers in Services on Intra-African Trade: Global Trade Analysis Project Model

“…Several studies have examined the impact of trade liberalization (reduction of tariffs and nontariff barriers) on the performance of the agricultural sector in African trading blocks (Nin-Pratt and Diao, 2014;Elbushra et al, 2011). Others have assessed the impact of AfCFTA on GDP and total intra-African trade (AfDB, 2019;Abrego et al, 2019).…”