African Regional Trade Agreements Research Articles

Intellectual property policy formulation in Africa

This article examines continental, sub-regional and national initiatives in the formulation of intellectual property policy Africa. The article is divided into seven parts. The first looks at the relationship between IP and economic development. The second part examines the role of IP regional integration and trade. The third part looks at African regional trade agreements. Next, the article surveys the activities of sub-regional IP systems in Africa: the African Regional Intellectual Property Organization (ARIPO) and the Organisation Africaine de la Propriété (OAPI). The fifth part looks at the recent formation of the Pan African Intellectual Property Organization (PAIPO) and its relationship with ARIPO and OAPI. The sixth part gives a brief overview of the efforts made in designing national IP polices. The concluding section summarizes the IP policy-making process in Africa.

The African Continental Free Trade Area in a Stagnating Multilateral Trading System: On the Likely (Ir)relevance of the Enabling Clause

This paper analyses the African Continental Free Trade Area (AfCFTA) whose Agreement entered into force on 30 May 2019, and particularly its relationship with the World Trade Organization. It considers whether the practice of African Regional Trade Agreements (RTAs) to rely on the Enabling Clause since 1979 should be replicated in the context of a 21st century trade deal. Considering the ambition of the AfCFTA for a deep integration, aiming at liberalising trade in goods, services, investment, intellectual property, competition, etc., the Enabling Clause may thus appear as a second-best option. This view is also supported by claims that reliance on variable geometry has been counterproductive in regulating African RTAs. While notification of the AfCFTA as a full fledged RTA may also sound, at least theoretically, too ambitious for a scheme composed of developing countries, this paper contemplates the GATT Article XXIV’s “interim agreement” alternative, which, nevertheless, comes with some strict rules regarding completion timeframe. Whereas adherence to such a schedule is generally not a requirement for RTAs notified as full agreements and may in such a scenario sound like an “undue” burden on African countries, the paper argues that it could alleviate the predicaments of lack of political will that has marred regional economic integration projects on the continent.

Supplementary Trade Benefits of Multi-Memberships in African Regional Trade Agreements

ABSTRACTFew papers have investigated the trade effects of multi-memberships of Regional Trade Agreements (RTAs), but none has done this in an Africa-wide manner. This paper investigates the supplementary trade effects of multi-memberships of RTAs after controlling for single-membership for all African RTAs. We use (1) overall number of RTAs by country pair; (2) dummies of number of RTAs; and (3) number of RTA memberships by countries within each RTA grouping, in a panel of 53 African countries from 1995 to 2014. The gravity models are estimated with the Eicker-White robust covariance Poisson Pseudo-Maximum Likelihood (PPML) which is superior to previous ones. All the estimates concur that multi-memberships have significant additional intra-Africa trade benefits which increase with the number of memberships. The implication is that although RTAs enhance trade in Africa, it is only a second-best to a complete integration of the African continent. A complete dismantling of politically induced trade barriers and even inter-RTA boundaries within Africa will yield significant intra-Africa trade benefits. The results support the ongoing efforts in Africa in pursuing a “one Africa” vision. Such efforts have to transcend regional integration and pursue the ideal of an integrated Africa for the full trade benefits to be realized.

Effects of Regional Trade Agreements on Strategic Agricultural Trade in Africa and Its Implications to Food Security: Evidence from Gravity Model Estimation

The problems of African agricultural development have been at the forefront of the debate on Africa’s development since the Lagos Plan of Action in 1963. During the 2004 AU meeting in Sirte, Libya and subsequently in the 2006 AU/NEPAD Summit on Food Security in Africa, concrete steps have been taken to work towards Common African Market on 12 selected strategic agricultural products. Eight regional trade agreements which are to form the building blocks of the African Economic Community are engaged in trade liberalization and regional integration process on the selected strategic agricultural products with the ultimate goal being the formation of Common Markets for Agricultural products. However, the recent proliferation of regional trade agreements (RTAs) has intensified the debate on their merits especially the merits of south-south trade agreements. This study contributes to this debate by analysing trade creation and trade diversion effects of African RTAs on trade in nine of the twelve strategic agricultural products. An extended gravity model is estimated. We address econometrically the endogeneity of RTAs using a panel approach. Results indicate that African RTAs have mixed effect on trade creation and trade diversion. Net trade creation is positive in three of the eight RTA and it is negative in two. Although a lot remains to be done, RTAs in Africa are an attractive means to speed up the move towards common market for agricultural products in the continent. This will have positive implication for food security and sustainable agricultural development in the continent.

African Regional Trade Agreements and Intra-African Trade

This paper investigates regional trade agreements in Africa by using panel data spanning 1995~2014. Trade creation and diversion effects are assessed through a gravity model estimated using the Eicker-White robust covariance Poisson pseudo-maximum likelihood method. This method proves superior to the usual nonlinear least square estimators, especially against heteroscedasticity and data with zero value. The findings suggest that regional trade agreements may enhance trade. The differences in effects can be matched with the effectiveness in implementation by respective member countries. The trade gains of regional trade agreements do not come at the expense of trade with non-members. By controlling for the duration within a regional trade agreement, we also show that a very small but significant share of the benefits occurs over time in the Economic and Monetary Community of Central Africa, Southern African Development Community, Southern African Customs Union, and West African Economic and Monetary Union. Trade benefits seem to decline over time in the East African Community.

Revisiting the effect of regional integration on African trade: evidence from meta-analysis and gravity model

ABSTRACTTwo main shortcomings flaw the estimation of gravity model in previous studies that examined the trade-creating effects of African Regional Trade Agreements (RTAs). First, these studies fail to account for the multilateral resistance term. This omission makes the estimates from standard gravity model bias and inconsistent. Second, there is a significant proportion of zero trade flows, however, these studies also fail to account for them properly. They use either the Tobit model or replace zero flows with arbitrary small values. Apart from these problems, they also exhibit considerable heterogeneity in the RTA effects on trade. In this paper, a meta-analysis of previous empirical studies is conducted to derive a combined effect size and also to explain the heterogeneity. In addition, I use the gravity model to compare the trade-creating effect of the main African RTAs. Using the gravity model, I compare the estimation methods of previous studies to the Poisson pseudo-maximum-likelihood estimator that tackles the zero flows. From the meta-analysis, I find a general positive effect of African RTAs of about 27%–32%. A comparative assessment of the RTAs using gravity model shows a striking heterogeneity.

Measuring Multi‐Membership in Economic Integration and Its Trade Impact: A Comparative Study of ECOWAS and SADC

AbstractOne of the intriguing aspects of African regional trade agreements (RTAs) is the extent of multi‐membership, where many African countries are members of more than one RTA. Using a gravity model for 25 countries and the years 1980‐2006, we measure the extent of multi‐membership and compare its impact in two major African regional blocs, Economic Community of West Africa States (ECOWAS) and Southern Africa Development Community (SADC). We find that the impact of multi‐membership critically depends on the characteristics of the multi‐membership of regional integration initiatives. We find a positive impact if an additional membership complements the integration process of the original regional integration initiative: overlapping memberships had a much stronger and significant positive effect on bilateral trade within ECOWAS compare with an insignificant impact within the SADC.

Consequence of Regional Trade Agreements to Developing Countries

We investigate the effects of 12 major Regional Trade Agreements (RTAs) on intraand extra-regional trade flows in member developing countries, both intra-RTA trade and the effect of RTAs on non-member trade over 1981~2008. We address and resolve statistical problems caused by logarithms, zero observations, and heteroskedasticity. Our regression results are not favorable to regional integration as a substitute for multilateral trade liberalization, although there are exceptions. Several RTAs fail to generate intrabloc trade creation. Seven of the 12 RTAs generate import trade diversion while most of the extra-bloc export dummies are not statistically significant. However, three of the five African RTAs in the sample increased intra-bloc trade. The differences in RTA performances are related to their implementation policies.

African Regional Trade Agreements as Legal Regimes

African Regional Trade Agreements as Legal Regimes

African Regional Agreements: Impact on Trade with or without Currency Unions

The aim of this paper is (i) to assess the impact of regional agreements on members’ trade in SubSaharan Africa (intra-regional trade as well as trade with the rest of the world), controlling for the other traditional determinants, including geography and transport costs and (ii) to compare the respective effect of the preferential trade agreements and the monetary unions. Considering the period 1962-1996, we first assess the average impact of each regional agreement on their implementation period and second we show how these impacts have evolved. An “augmented” gravity model is designed, relying on a transport cost function, in which specific dummies allow trade creation and trade diversion effects to be separated. The model is estimated in panel with bilateral specific effects, to isolate the non-observable characteristics of each pair of countries, and according to the HausmanTaylor (1981) method, which takes into account a possible endogeneity of some explanatory variables. During their implementation, the African regional trade agreements have generated a significant increase in trade between members, although initially often through trade diversion. In the two agreements of the CFA franc zone, the currency unions have largely reinforced the positive effect of the corresponding preferential trade agreements on intra-regional trade, while dampening their trade diversion effect. Actually, currency unions rather had a trade creation effect (all the more important as the international monetary environment has been more unstable), whereas preferential trade agreements resulted in important trade diversion.

African Regional Agreements: Impact on Trade with or without Currency Unions

The aim of this paper is (i) to assess the impact of regional agreements on members’ trade in Sub-Saharan Africa (intra-regional trade as well as trade with the rest of the world), controlling for the other traditional determinants and (ii) to compare the respective effect of the preferential trade agreements and the currency unions. Considering the period 1962–96, we first assess the average impact of each regional agreement on their implementation period and second we show how these impacts have evolved. An ‘augmented’ gravity model is designed, relying on a transport cost function, in which specific dummies allow trade creation and trade diversion effects to be separated. The model is estimated in panel with bilateral specific effects, to isolate the non-observable characteristics of each pair of countries and according to the Hausman–Taylor (1981) method, which takes into account a possible endogeneity of some explanatory variables. During their implementation, the African regional trade agreements have generated a significant increase in trade between members, although initially often through trade diversion. In the two agreements of the CFA franc zone, the currency unions have largely reinforced the positive effect of the corresponding preferential trade agreements on intra-regional trade, while dampening their trade diversion effect.