The rise and fall of (Chinese) African apparel exports
AbstractDuring the final years of the Multifiber Agreement the US imposed strict import quotas on Chinese apparel while it gave African apparel duty- and quota-free access. The combination of these policies led to a rapid but ephemeral rise of African exports. In this paper we argue that the African success can be explained by a temporary transhipment of Chinese apparel driven by quota-hopping Chinese assembly firms. We first provide a large body of anecdotal evidence on the Chinese apparel wave in African countries. Second, we show that Chinese apparel exports to African countries predict US imports from the same countries and in the same apparel categories but only where transhipment incentives are present, i.e. for products with binding quotas in the US and for countries with preferential access to the US unconstrained by rules of origin. Using input-output linkages, we then show that African countries imported quasi-finished products with little assembly work left to do, rather than primary textile inputs. We estimate that direct transhipment may account for around half of AGOA countries apparel exports.
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Bibliographic InfoPaper provided by Centre for the Study of African Economies, University of Oxford in its series CSAE Working Paper Series with number 2012-12.
Date of creation: 2012
Date of revision:
Transhipment; AGOA; Multifiber agreement;
Other versions of this item:
- Pierre-Louis Vezina & Lorenzo Rotunno & Zheng Wang, 2012. "The rise and fall of (Chinese) African apparel exports," Economics Series Working Papers WPS/2012-12, University of Oxford, Department of Economics.
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
- O19 - Economic Development, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
This paper has been announced in the following NEP Reports:
- NEP-AFR-2012-09-16 (Africa)
- NEP-ALL-2012-09-16 (All new papers)
- NEP-DEV-2012-09-16 (Development)
- NEP-INT-2012-09-16 (International Trade)
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