Why Is Agricultural Trade within ECOWAS So High?

Abstract

It is widely believed that the countries of Africa trade relatively little with the outside world, and among themselves, despite an extensive network of regional trade agreements. We examine this proposition by focusing on agricultural trade. Specifically, we ask whether non-tariff barriers (NTBs) are stunting agricultural trade within the Economic Community of West African States (ECOWAS), a grouping of fifteen countries in West Africa that has removed tariffs on agricultural trade among its members. Our survey of truckers in Tambacounda (Senegal) in August 2009 found evidence of extensive bribery by police and border officials, effectively representing a barrier to trading. We estimate a unit-elastic structural gravity model of agricultural trade, using data from 135 countries for 2000, 2003 and 2006, and employing Tobit and other types of structural specification. A robust result emerges: agricultural trade among the countries of ECOWAS is higher than one would expect. This does not mean that there are no NTBs within ECOWAS, but it does imply that any such barriers are less harmful to agricultural trade in ECOWAS than in the world as a whole. Similar effects are found for the Common Market for Eastern and Southern Africa (COMESA) and the South African Development Community (SADC). This suggests that African countries are not averse to agricultural trade, and local traders have been effective at exploiting trade opportunities. Copyright 2013 , Oxford University Press.