ABSTRACT

Economists and policy-makers alike seek to understand the ways in which countries successfully nurture and grow their domestic economies. This is particularly relevant with respect to export markets. This chapter investigates the effect of export sophistication on economic performance. It considers the role of export sophistication in the growth of a set of middle-income African economies. It is reasonable to assume that in Africa, the growth of the 'richer', and by extension the middle-income, African countries may be associated with increased sophistication and innovations in trade. In fact, the African service industry is gradually growing and becoming more productive and tradable. In a world of freer trade, many developing as well as developed countries are feeling threatened by lower-wage trading partners. For example, China has displaced the textiles and apparel manufacturing industries in many countries.