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How important is a regional free trade area for Southern Africa?: Potential impacts and structural constraints

Author

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  • Nin Pratt, Alejandro
  • Diao, Xinshen
  • Bahta, Yonas

Abstract

"We develop a detailed trade analysis to assess the potential welfare impacts of a free trade agreement (FTA) on the agricultural sector of southern African countries and to determine opportunities and challenges faced by the region as a consequence of the agreement. Our approach combines an in-depth look at the current trading patterns of southern African countries with the application of a partial equilibrium analysis that uses bilateral trade data at the four-digit standard international trade classification (SITC) level for 193 agricultural industries in 14 southern African countries. Low diversification of agricultural exports in most southern African countries seems to be a major constraint for promoting regional trade. In most countries, overall welfare effects of an FTA would be positive but small. Inefficient agricultural producers with a regional comparative advantage for agriculture would benefit from trade creation with the rest of the world. Welfare results for regional importers would be negative because of increased imports from inefficient regional producers. These results suggest that the region should be looking at regional policies and interventions beyond trade arrangements, such as those targeting investment, agricultural productivity, and diversification, to enhance benefits of regional trade liberalization." from authors' abstract

Suggested Citation

  • Nin Pratt, Alejandro & Diao, Xinshen & Bahta, Yonas, 2009. "How important is a regional free trade area for Southern Africa?: Potential impacts and structural constraints," IFPRI discussion papers 888, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:ifprid:888
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    References listed on IDEAS

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    Cited by:

    1. Yonas T. Bahta & Salomo Mbai, 2023. "Competitiveness of Namibia’s Agri-Food Commodities: Implications for Food Security," Resources, MDPI, vol. 12(3), pages 1-21, March.
    2. Osman, Rehab Osman Mohamed, 2012. "The EU Economic Partnership Agreements with Southern Africa: a computable general equilibrium analysis," Economics PhD Theses 0412, Department of Economics, University of Sussex Business School.
    3. Sulser, T. B., 2009. "Green and blue water accounting in the Limpopo and Nile basins: implications for food and agricultural policy," IWMI Working Papers H042476, International Water Management Institute.

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    Keywords

    Regional trade agreement; Agricultural trade; Development strategies;
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