Could Extended Preferences Reward Sub‐Saharan Africa's Participation in the Doha Round Negotiations?

Abstract

Despite sharp improvements in the preferential schemes Sub-Saharan African countries benefit from, African exporters still face tariff barriers on the Quad markets (Japan, USA, European Union and Canada), and rarely enjoy preferential access to other developing countries. This study estimates the gains that Sub-Saharan Africa could draw from a genuine unrestricted market access (UMA) to the QUAD markets, as well as an improved access to the emerging economies. Based on a General Equilibrium modelling, it analyses the effects of these proposals, and whether they could be valid options in the Doha Development agenda. It concludes that the welfare gains associated with UMA could amount to US$ 1.2 billion in sub-Saharan Africa, favouring primarily unskilled workers. A decrease by half in the protection applied by emerging countries on the African products would have similar effects. These proposals induce limited costs for the QUAD economies, as well as indirect benefits for developing countries, due to trade shifts on the Quad and African markets. Besides, they could largely offset the potentially harmful effects of the multilateral tariff liberalization on the African economies, and would not be much affected by a partial reciprocation of the preferences by the African countries.