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Enhancing trade between Arab
and African countries
Troisième Réunion des Chambres de Commerce et d’Industrie
d’Afrique et du Monde Arabe ,Rabat – Maroc, 29-30 Novembre
2012
Dr. Azza Morssy ,
Chief of Middle East &Arab Programme , UNIDO (Vienna)
UNIDO & Global Trade
is enhancing the capacity of
developing countries and countries
with economies in transition to
participate in global trade and
integrate them into global value
chains through effective participation
in the based- rules of global trading
system
UNIDO
2
Aid for Trade and UNIDO
“The UNIDO trade capacity approach and the
Aid for Trade Initiative are complementary
endeavors along the same holistic line of
thought”
Kandeh Yumkella, Director-General, UNIDO
Source: UNIDO 2009
3
Trade & Poverty reduction
Improved
export
performance
More trade
creates jobs
and income
opportunities
Economic
growth
Increases
competitiveness
of firms
Reduction of trade costs
Source: World Bank 2012
4
Africa: Economic Profile
• The near-term outlook remains positive
in the post-crisis period
• Africa will have the world’s largest
workforce by 2040 (approximately 1.2
billion) and will need to create a
sufficient number of jobs
Source: UNIDO 2009
5
Africa’s main exports
• Fossil fuels (petroleum, hard coal, and natural
gas) are main exports
• Fossil fuels - total exports increased from
72% in 1980 to 75% in 2008, ( above the
global average of 50%)
• In physical terms, all African countries
account for about 10.5% of fossil fuels supply
to the world market
Source: UNCTAD 2012
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1. Africa’s share of global international
trade 2000-2010, (%)
Source: UNECA 2012
7
Industrial Challenges for SSA and
MENA
• Several countries in SSA are affected
by deindustrialization
• Several countries in the MENA are
affected by the middle-income trap
8
Exports by Product (MENA)
Source: WTO 2012
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Common Growth Prospects
Both regions are expected to continue their
economic recovery to pre-crisis levels
The MENA region is expected to accelerate its
economic growth to 5.1% in 2012
In Sub-Saharan Africa (SSA) growth is
projected to grow at over 5% in 2012 as well
Source WTO2012
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The middle-income trap
It affects “countries unable to compete with
low-income, low-wage economies in
manufactured exports and with advanced
economies in high-skill innovations … such
countries cannot make a timely transition
from resource-driven growth, with low cost
labor and capital, to productivity-driven
growth”.
Source: ADB 2012
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Source: ILO 2010
Unemployment Rate by Education Level
30
25
Basic
20
Intermediate
% 15
Advanced
10
5
0
Jordan
Lebanon
Morocco
Qatar
Saudi
Arabia
Syria
Algeria
Tunisia
West Bank
and Gaza
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Global Trade Challenges
SUPPLY SIDE:
“LDCs have neither the surplus of capacity of exportable products nor the production
capacity to take immediate advantage of new trade opportunities”
Kofi Annan - UN SG, Financial Times, 5 Mar. 2001
CONFORMITY:
Countries that can not meet standards and regulations in developed country
markets are effectively barred from trading with those markets.
International Development Research Centre (IDRC), Canada
Trade facilitation/infrastructure:
For the majority of African countries, tariffs amounted to less than 2%, while
transport cost often exceeded 10%.
World bank trade note 15; may 10, 2004
No.14
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Challenges for Trade : The 3 Cs
“Countries must have  COMPETITIVITY of productive
capacities
“Products must conform to requirements of clients and
markets”
 CONFORMITY with standards
“Rules for trade must be equitable and customs
procedures harmonized”
 CONNECTIVITY to markets
 PRODUCTIVITY (enterprise)
 COST OF EXPORTING (support services)
Compete
Conform
Connect
No.15
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The Arab World: Economic Profile
• Economic growth in the Arab world
slowed significantly with the global
financial crisis
• Urgent need to create 2.8 million
jobs every year
Source: Arab Competitiveness Report 2011-2012
16
Africa and world trade
• African countries are net suppliers of resources to
the world
• In 2008, net exports of materials by the region
were 409 million tons, compared to 284 million
tons in 1980
• Since 2000: significant increase in demand for
Africa’s resources by developing countries such
as Brazil, China and India
Source: UNCTAD 2012
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Rapid GPD Growth
MENA countries as a whole grew by
5.2%from 2000 to 2008,
whereas OECD economies grew by
only 2.4%
Source: Arab Competitiveness Report 2011-2012
18
Exports and Imports in the Arab World
(% of GDP)
60
50
% of GDP
40
30
20
Exports of goods and services
(% of GDP)
Imports of goods and services
(% of GDP)
10
0
Source: World Bank 2012
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Industrial challenges
• As Justin Lin (2012) suggests, income
growth in developing countries depends
on upgrading industrial structures
• Whereas Arab and African countries
are major exporters of fuels and mining
products, other Regions are major
exporters of manufactured goods
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Exports by Product (Africa)
Source: WTO 2012
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The Triangle Trade
Developed
countries
WB
Payement of débats and interests
Multinational
Africa
Loans
IMF
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22
Strategic Partnerships for Trade Capacity-Building
No.23
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Potential in Agro-Food area
Pre-conditions for Exports :
Regulatory Environment for Compliance
WTO -TBT /SPS Agreements (Jan 1995)
WTO- TBT & SPS agreements compliance




Products sourced from areas free of pests & diseases
Fruits/vegetables - minimum pesticide residue standard
Meats/fish meet minimum antibiotic residue requirement
Standards of hygiene applied in manufacturing HACCP/ISO
22000) /lack of implementation capacity the above issues by developing
countries
No.24
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“Fair Trade for All”:
“lack the ability to meet quality Standards
Requirements,”“UNIDO recommends the following priority
areas for assistance :
1. A national/regional standards/standardization
body
2. A national/regional metrology system
3. A certification/conformity assessment
4. An accreditation system”
Source: J. Stiglitz & A. Charlton, Fair Trade for All – How Trade can promote
Development, Oxford University Press, 2005
No.25
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Africa Aid
 Increased Aid to Africa
 More funds for Investment and Trade and build
capacity in several sectors that will boost
production, marketing of products and service
 Proper transparency and accountability of the
donor and recipient governments
 Proper planning, monitoring and implementing
projects that will result in a positive multiplier effect for
general development
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UNIDO inputs/ Africa
Support to the National Prevention Programme of Ochratoxin in Coffee and Cocoa in Côte d’Ivoire
Objective: help the supply-chain actors to secure their incomes and
exportations
Outputs:
- studies in coffee and cocoa supply-chains (determination of contamination levels,
identification of critical contamination points, and determination of adequate
sampling
methods);
- national OTA analytical laboratory upgrading for ISO/IEC 17025 accreditation
- promotion of good practices during production and post-harvest stages
- Lobbying activities to draw the attention of the EC on adequate OTA maximum
levels.
* The OTA is a mycotoxin considered as a genotoxic human carcinogen and the
European Commission (EC) is examining the opportunity to raise new maximum
contamination levels for green and roasted coffee, cocoa and cocoa based products
No.27
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UNIDO Aid-for-Trade type Programmes (Supply-side & Conformity)
Trade related technical assistance programme
Barrier to Trade Survey : Study
on SPS Compliance for Exports
Standards (PSQCA)

•
Standards development /Certification Body (Systems)
Consumer affairs/ Product certification
Metrology (NPSL)
•
Lab upgrading, international accreditation
Product Testing (MFD, PCSIR, etc): Fisheries, Food, Leather,
Textile
•
•
Lab upgrading, PT participation
International accreditation
Accreditation (PNAC)
Boat hygiene
Icing
Landing Sites
Inspection
Organizational strengthening, international recognition
National accreditation scheme /Training of auditors
Setting-up of PT schemes
Auction Hall
Quality/Hygiene (Private sector, FPCCI, etc.) Fish/food
Traceability
•
•
•
•
•
Processors
Management systems/Good practices /Compliance with market
requirements Pilot certifications HACCP, ISO 9001, 14001, SA 8000)
Pilot traceability systems
No.28
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UNIDO TCB - LDCs Coverage (36 countries)
On-going and planned
UEMOA/ECOWAS
Benin
Mali
Burkina Faso
Niger
Cape Verde Senegal
Sierra Leone
Gambia
SAARC
Bangladesh
Togo
Guinea
Bhutan
Guinea Bissau
Maldives
Afghanistan
Liberia
Mauritania
SAARC
Haiti
CARICOM
CARICOM
Haiti
Nepal
Nepal
Bangladesh
UEMOA/
Senegal
ECOWAS
EAC
Tanzania
Central African Rep.
Congo
Cambodia
Cambodia
Ethiopia
CEMAC
CEMAC
Chad
MEKONG Delta
Countries
MEKONG
Mozambique
Madagascar
SADC
Lao PDR
EAC
Uganda
Tanzania
Burundi (2007)
Rwanda (2007)
Equatorial Guinea
SADC
Source: OECD DAC List
Angola
Malawi
Congo
Mozambique
Lesotho
Tanzania
Madagascar
Zambia
Regional Programmes
Country Programmes
No.29
29
GDP Growth by Region
(percent change, constant prices)
Source: Arab Competitiveness Report 2011-2012
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UNIDO &Supply Side 1/2
UNIDO will continue to support enterprises in their efforts to
offer competitive, safe, reliable and cost-effective products
in world markets, this requires:
Identifying
sectors and
products that
have
competitive
potential and are
suitable for local
value addition
Analyzing and
assessing
trends in
industrial
performance
at national,
regional and
global level, and
Formulating
strategies and
policies designed to
improve industrial
competitiveness
and to overcome
technical barriers
to trade (TBT) and
comply with sanitary
and phyto-sanitary
measures (SPS).
Assisting in
upgrading
manufacturing
processes in
sectors with highexport potential to
internationally
acceptable levels.
31
UNIDO is continuing to offer the following activities
:2/2
strengthen the capacity of countries,
productive sectors and suppliers to
produce goods that meet requirements
set by foreign buyers and markets;
build up the national and
regional quality
infrastructure needed to
provide internationally
recognized quality
assurance services,
standards, product testing
facilities and calibration
laboratories,
Creation of quality
management systems
and product traceability
management system
certification, inspection
and accreditation
mechanisms
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A New Vision for Trade Facilitation
Physical
Infrastructures
Logistics and
Transport
Services
Customs-BorderTransitManagement
• Roads, ports, etc.
• Telecommunicatio
ns
• Promoting
competition
Traditional focus of
trade facilitation
Competitiveness
• Export
Promotion
• Meeting int.
standards
33
The Aid for Trade Agenda
Trade policy and
regulations
Trade-related technical
assistance and capacity
building
Trade-related infrastructure
Building productive capacity
Source: OECD 2012
Macroeconomic and microeconomic adjustment
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Conclusions
Developing Compliance Infrastructure is
complex – tailor programmes
Regional cooperation programmes are
needed for developing Regional Capacity
building on complying with standards
Compliance Infrastructure
3 pronged: Competitive supply – Compliance
services - Connectivity
35
Recommendations
1. Improving cross-border trade: border
procedures, traders’ associations, flow of
information
2. Removing a range of non-tariff barriers to
trade: import and export bans, costly
licensing procedures, restrictive rules of
origin
3. Reforming regulations and immigration
rules: limits to the potential for cross-border trade
and investment in services
Source: World Bank 2012
36
Trade-related opportunities for Africa
and the Middle East
• Regional cooperation can contribute to closer
integration beyond trade
• More open trade in food staples can reduce food
insecurity
• Additional trade can increase competitiveness in
regional value chains
• Grant access to the increasingly global value
chain production
• Achieve common positions and represent these
interests in the international arena
37
Thank you for your esteemed
attention!
Azza Morssy, PhD
Chief, Middle East and Arab Programme
Bureau for Regional Programmes
Programme Development and Technical Cooperation Division
United Nations Industrial Development Organization (UNIDO)
Vienna International Centre
P.O. Box 300
1400 Vienna, Austria
Tel: +43-1-26026-3841
Fax: +43-1-26026-6848
E-mail : [email protected]
•
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ANNEXES
TRADE & ECONOMIC
GROWTH
39
Exports of all goods, non-petroleum and non-natural
goods
Source: World Bank 2011
40
World Exports by Product
Source: WTO 2012
41
Value Added in Selected Regions
(2009)
Source: OECD 2011
42
Value added in the MENA region (2009)
Source: OECD 2011
43
Oil production and the MENA
• World crude oil production increased by 60%
from 1971 to 2010
• The MENA region holds about 65% of the
world’s proven conventional oil reserves (at
the end of 2010)
• In 2010, the Middle East region’s share of oil
production was 30% of the world total
Source: OECD 2011
44
Production of Crude Oil by Region
(million tonnes)
Source: OECD 2011
45
Oil revenues continue to mount through
2014 (billions US$)
Source: World Bank 2012
46
Oil exporters in the MENA
(current account balances, billions of US$)
Source: IMF 2012
47
Oil importers in the MENA
(current account balances, billions of US$)
Source: IMF 2012
48
Africa’s material imports
• Fossil fuels are the dominant material imports, with a
share between 33 and 37% of total imports
• The world average share of 50 to 55% of fossil fuels in
total imports
• All African countries together import about 100 million tons
of fossil fuels, (2% of global imports of fossil fuels
• Africa is a net importer of renewable resources
Source: UNCTAD 2012
49
Physical trade volume in Africa and the
world, 1980-2008
Source: UNCTAD 2012
50
Material extraction in Africa, by category,
2000-2008
Source: UNCTAD 2012
51
Material extraction in selected African countries,
by material category, 2008
(millions of tons)
Source: UNCTAD 2012
52
Africa’s share of global production and reserves of
selected minerals
Source: UNCTAD 2012
53
2. Industrial development and per capita
resource use in Africa (2008)
Source: UNCTAD 2012
54
Population, output and carbon emissions,
across regions, in 2009
Source: International Energy Agency 2011
55
GDP and GDP per capita growth
(2009/2010)
Source: Arab Competitiveness Report 2011-2012
56
MENA Exports as a Share of GDP
Source: Arab Competitiveness Report 2011-2012
57
Goods exports destinations (individual countries)
Source: Arab Competitiveness Report 2011-2012
58
FDI Inflows in the MENA
(as a percentage of the total)
Source: Arab Competitiveness Report 2011-2012
59
FDI Inflows as a Share of GDP
Source: Arab Competitiveness Report 2011-2012
60
FDI by Economic Sector
(cumulative 2000-07)
Source: Arab Competitiveness Report 2011-2012
61
World Proven Oil Reserves by Region
(2010)
Source: Arab Competitiveness Report 2011-2012
62
MENA proven crude oil reserves by country
(2010)
Source: Arab Competitiveness Report 2011-2012
63