Some consequences of trade liberalization in sub-Saharan Africa

A basic premise of the influential Berg Report ² was that Africa’s supposed comparative advantage lay in agriculture. If only the state would stop “squeezing” agriculture through marketing boards and price distortions, the supply-side response to agricultural producers would drive export-led growth. But, contrary to popular assumptions, Africa is at a comparative disadvantage with agricultural exports, relative not only to the developed world, with its protected “green pastures,” heavy subsidies, and industrial farming, but also to much of Asia and Latin America as well. Subsequent changes in Africa’s exports indicate no significant increase in activities in which African countries ostensibly had comparative advantage. Indeed, after two decades of reforms, Africa’s share of global non-oil exports fell to less than half what it was in the early 1980s ³ with the trend continuing over the last decade.