Crisis Management Today and Investing for Tomorrow: Why Trade Facilitation Matters to Africa

There are many factors which will impact Africa’s ability to weather the current economic crisis. Finding ways to reform trade policy that enhances private sector growth should be part of any strategy now and in the long-term to counteract the damage today’s economic crisis is having. As Shanta noted in his lecture in November at Columbia, private sector growth is a key priority for Africa. Policy, institutional, and other barriers, including trade restrictions need to be addressed. We recently examined the most important obstacles to trade facilitation in Africa. This included how increased port efficiency, improved customs, and regulatory environments, and upgrading services infrastructure could help that continent.  We found that improvement in ports and services infrastructure promise relatively more expansion in intra-African trade than other measures. These are the types of investments that can have a stimulus effect now and help over the long-term. Regional trade agreements have a positive effect on trade flows. Acting today to address infrastructure gaps and new commitments to reduce barriers through strong regional agreements should be part of any plans considered for reform in Africa.