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Do Chinese Exports Crowd-out African Goods? An Econometric Analysis by Country and Sector

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  • Giorgia Giovannetti

    (Department of Economics, University of Florence, Italy)

  • Marco Sanfilippo

    (Department of Economics, University of Florence, Italy)

Abstract

Trade is one of the key channels through which Chinese economic growth affects the world economy and especially developing countries. African manufacturing sector is confined to few traditional sectors. Even if at times, and in some sectors, African exports have been favored by preferential treatments, Africa has proven to be particularly vulnerable to the competitive threat posed by China in third markets, including other African countries. With the intensification of economic relations, in fact, China has started flooding African markets with its low-cost manufactures, often at the expense of local producers. Furthermore, in Africa's main trade partners, namely United States and European Union, most Chinese goods are likely to crowd-out cheap African manufactures. We measure the indirect impact of China on African exports. Using disaggregated data for the period 1995–2005, we present significant evidence on the existence of a displacement effect at different levels: sector, product, region and market.C'est à travers la croissance économique chinoise que se manifeste l'un des plus grands impacts de la chine sur l’économie mondiale et plus particulièrement sur celle des pays en développement. Le secteur manufacturier africain se limite à quelques productions traditionnelles. Même si, à certaines périodes et dans certains secteurs, les exportations africaines ont bénéficié de traitements préférentiels, l’Afrique s’est avérée particulièrement vulnérable à la menace compétitive exercée par la Chine sur les marchés tiers, y compris sur d’autres marchés africains. En effet, avec l’intensification des relations économiques, la Chine a commencé à inonder les marchés africains avec des produits manufacturés à bas coûts, souvent au détriment des producteurs locaux. De surcroît, aux Etats Unis et en Europe, principaux partenaires des pays africains, les produits chinois sont aussi susceptibles d’évincer des produits manufacturés africains bon marché. Nous mesurons l’impact indirect de la concurrence chinoise sur les exportations africaines. En utilisant des données désagrégées sur la période 1995–2005, nous mettons en évidence l’effet de déplacement au niveau des secteurs, des produits, des régions et des marchés.European Journal of Development Research (2009) 21, 506–530. doi:10.1057/ejdr.2009.20

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Article provided by Palgrave Macmillan in its journal European Journal of Development Research.

Volume (Year): 21 (2009)
Issue (Month): 4 (September)
Pages: 506-530

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Handle: RePEc:pal:eurjdr:v:21:y:2009:i:4:p:506-530

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Citations

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Cited by:
  1. de Sousa, José & Mayer, Thierry & Zignago, Soledad, 2012. "Market access in global and regional trade," Regional Science and Urban Economics, Elsevier, vol. 42(6), pages 1037-1052.
  2. Giorgia Giovannetti & Marco Sanfilippo & Margherita Velucchi, 2011. "The “China effect” on EU Exports to OECD markets – A focus on Italy," Working Papers - Economics wp2011_17.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
  3. Giorgia Giovannetti, Marco Sanfilippo and Margherita Velucchi, 2012. "The impact of China on manufacturing exports of Italy and Germany," RSCAS Working Papers 2012/26, European University Institute.
  4. Cooke, Edgar F. A., 2012. "Is the impact of AGOA heterogeneous?," MPRA Paper 43277, University Library of Munich, Germany.
  5. Mary-Françoise Renard, 2011. "Working Paper 126 - China’s Trade and FDI in Africa," Working Paper Series 297, African Development Bank.
  6. Busse, Matthias & Erdogan, Ceren & Muehlen, Henning, 2014. "China's Impact on Africa - the Role of Trade, FDI and Aid," IEE Working Papers 206, Institut fuer Entwicklungsforschung und Entwicklungspolitik, Ruhr-Universitaet Bochum.
  7. Jenkins, Rhys & Edwards, Lawrence, 2013. "Is China "crowding out" South African exports of manufacturers," SALDRU Working Papers 107, Southern Africa Labour and Development Research Unit, University of Cape Town.

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