Input-output linkages and interdependence between countries in Southern Africa

Abstract

ABSTRACT Regional industrialisation and integration form part of the economic policy priorities of a number of countries in Southern Africa and of the Southern African Development Community (SADC). Manufacturing can be seen as a key driver of domestic and regional industrialisation and growth, given its ability to exhibit high backward and forward input-output linkages. While most input-output research for African countries explores domestic input-output linkages, this paper investigates inter-country intersectoral linkages among five Southern African countries for the years 2000 and 2015. We find that linkages tend to be highest in the manufacturing sector, particularly in ‘food and beverages’, across the countries in the study. We also find that the highest inter-country linkages are found between neighbouring countries. These findings suggest that regional growth may benefit from promoting manufacturing, especially agro-processing sectors. Regional integration may benefit from a specific focus on bilateral relationships between neighbouring countries.