Competitiveness of Namibia’s Agri-Food Commodities: Implications for Food Security

Abstract

The global literature widely uses Revealed Comparative Advantage (RCA), Lafay Index (LFI), Export Diversification (EDI), Hirschman (HI), and Major Export Category (MEC) to analyze international trade flows, though agricultural trade, specifically agri-food commodities consisting of food and feed commodities, is neglected in empirical works. Furthermore, the determinants of Revealed Comparative Advantages and the Lafay Index have received little attention, with little focus on the relationships between food insecurity as measured by the Household Food Insecurity Access Scale (HFIAS) and the aforementioned factors, including the RCA and LFI indices as explanatory variables with other macroeconomic variables. The purpose of this study was to ascertain the competitiveness of Namibia’s agri-food products, the factors that influence it, and their implication for food security. This study attempts to answer which factors affect agri-food comparative advantage, which agri-food commodities have a comparative advantage and disadvantage, and what the implications are to food security. The study employed regression analysis, the Household Food Insecurity Access Scale, and various indices. Revealed Comparative Advantage and Lafay Index indicated a mixed result during the study period. Export Diversification and Hirschman indices indicated a less concentrated trade structure throughout the study period. The results of the market structure of the international agri-food market estimated by the Major Export Category revealed that Namibia was unduly dependent on agri-food commodities incorporated in this study. The regression result showed a significant negative influence of labor and land productivity on the aggregated RCA and LFI for agri-food commodities. Land productivity and GDP per capita impact the degree of food insecurity in Namibia. The study concludes that Namibia was not dependent on international trade of agri-food commodities and had little bearing on food security. These analyses enlighten policymakers about the competitiveness of the agri-food business and its implications for food security through evidence-based policy development.