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'If you want something done well," goes the old saying, "do it yourself." After many years of looking to others to solve its problems, Africa is beginning to follow this advice -- or so its leaders promise. Trade, not aid, is now being promoted by African heads of state as the primary driver of economic development, the one way to improve the lives of millions of impoverished Africans. But the current view is still focused too much on what can be done by rich countries, and too little on what needs to be done at home, by African governments themselves. As African leaders gather in Cancun for the World Trade Organization's Fifth Ministerial Conference, the people of Africa hope that they will use this opportunity finally to commit to free trade on the continent.
For many years, there has been a tendency, both inside and outside Africa, to blame the continent's woes on the policies of rich countries. While there is some truth to these allegations, the critics of wealthy nations never tell the full story. In one area, however, they are correct: Rich countries -- especially the E.U., the U.S., and Japan -- restrict imports and subsidize exports of agricultural products, depressing world market prices for these goods and forcing Africans to import food that they themselves could grow more efficiently. Such policies harm Africa's farmers by reducing their profits and slowing economic development.
External factors are only a small part of the problem, however. Far more troublesome are the trade barriers African countries erect against one another, resulting in the inefficiency, lack of integration, and poverty that plague the continent. The long borders between African nations cause nothing but woe for millions of African traders. High tariffs and other restrictions turn what should be routine border checks into lengthy episodes involving harassment and kickbacks, with state officials demanding bribes to allow even the most basic goods to cross the border. Business trips that would otherwise take only a few hours eventually expand into an entire day or more. In the process, perishable goods spoil and valuables are stolen.
Excruciatingly high taxes are also to blame for the low levels of trade between African nations. While there is much talk of integrating various regions by creating free-trade zones, there has been little action to this end. The Abuja Treaty of 1994 provided for the phasing- out of trade barriers and the creation of a customs union with a uniform external tariff. But the average tariff rate in Africa is still extremely high: 19 percent, among the steepest in the world.
The result is that exports from Senegal and Cameroon, for example, find their way directly into French markets, but not those of their African neighbors.
The easing of border ...
Source: HighBeam Research, Special Section: Trade & Development - Trade, Not Aid: What...