As consumer purchasing power rises, intermediate goods that are used by a business in the production of finished goods or services will be important for Africa’s internal market.
This links to industrialization, which is a key goal in the African Union's Minimum Integration Programme. Building industrial clusters goes together with access to regional trade corridors that get goods moving and with promoting more regional electricity to power production.
Making production work better for the continent across different sectors, by being part of regional and global value chains, will be at the heart of Africa’s economic success model. Whether on agriculture or industrial production, regions need to unlock their productive potential, inject investment, overcome bottlenecks and make sectors more competitive.
Productive integration matters for creating an economic base that is more resilient to shocks and more diverse, but also for building a more skilled regional labour force that adds value to goods and services while raising people’s incomes on the ground. That includes opportunities with mining and manufacturing that are now shifting to Africa’s advantage.
- Share of intra-regional intermediate goods exports (% total intra-regional exports goods)
- Share of intra-regional intermediate goods imports (% total intra-regional imports goods)
- Merchandise Trade Complementarity Index: total absolute value of the difference between share of imports and share of exports of a member state in a REC
Made in Africa
The priorities for the continent and the regions, from regional hubs to landlocked least developed countries, will be to move beyond low value production and deal with non-tariff barriers to make trade work faster and cheaper. That way, when commodity prices fluctuate and financial crises are nearby, the ‘made in Africa’ brand will become part of the solution.
- EAC is the highest performing REC on Productive integration.
- There are a total of 30 high performing countries across the eight RECs on Productive integration.
- High performing countries on Productive integration in a particular REC that are not high performers on regional integration overall in that REC:
CEN-SAD (Kenya, Djibouti, Gambia, Egypt), COMESA (Madagascar, Djibouti), ECCAS (Burundi, Rwanda), ECOWAS (Gambia, Ghana, Liberia, Sierra Leone), IGAD (Djibouti), SADC (Zimbabwe, Mozambique), UMA (Tunisia)