April 28, 2021




An Article of Opinion: MEDays 2019 – Amadeus Institute 


By Khalil Halilu 



Historically, Africa has been known as an economic hub that has transcended from as early as 3500BC to present time. Home to a rich abundance of soft and hard commodities, Africa has had economic activities that worked over time and have now framed the new models. Trade routes (by land and waterways) that connected some parts of Africa to the Middle East, India, and China and certain parts of Europe existed at the time, served its purpose. Various items of trades were exchanged within the parts now known as Africa and the rest of the World. Soft Commodities included crops like Wheat, Cowpea, millet, etc depending on the regions that cultivated such and much later, hard commodities such as gold and oil. All of these and more made Africa one of the most sought-after economic destinations and a major player in the 17th-century world commodities market.




However, over the last century, Africa has been struggling to take its place in the World market; its share of commodities in the World market is on the decline. This is largely due to a shift in the dynamics. Industrialized economies have advanced level of technology; easy and seamless financial structures; and a shared focus on primary as well as secondary commodities.

According to the UNCTAD report on World Merchandise exports in 2015, the whole of Africa accounted for only 2.5% of global exports. A sharp contrast to what was in place in the 17th to early 20th century where Africa was pooling about 50% of World Exports. It is interesting, however, to note that African Countries are mainly exporting primary commodities while importing manufactured or finished commodities. Consequently, what this means is that Africa is creating wealth for other nations while impoverishing itself.


The Solution Within

The move to reverse this trend is what will bring Africa back into the game. How can this be reversed? The solution lies within us and it involves Intra-industry Trade. Developing an Inter-African trade has the potentials to create wealth for Africans, enhance investment and as a result, encourage the growth and development of the African economy. Industrial maturity comes with local creativity & competition which will eventually give Africa an edge at the global playground.


To attain this, we have to tackle the challenges that come with exporting & local commodity trading. For instance:



–    Creation of Scarcity

In a place where there are not enough resources for the immediate local requirement, while it may seem rational to export locally produced commodities, the resultant scarcity is far-reaching and affects the local consumers & producers in the exporting country. This keeps wealth in the hands of few, which doesn’t allow for exploration of the full potential of the local people.


–    Challenges associated with Logistics & Processing 

Another major challenge is that associated with product processing & logistics. This, of course, is wide-ranged and involves product modification to fit the specification of the receiving country; in today’s world of multiple choices for the consumer, there is very low chance of competing on a global scale if you’re are battling a crowded or insufficient trade route, with poor technology infrastructure for product processing.



Bureaucratic, Legal and Political Challenges

If not handled properly, bureaucratic and political issues around export could result in trade wars. Every country feels the need to protect its laws and citizens, however African trade policies needs to be aligned to come out stronger together






For Africa to compete at a global scale, there will be a need for improvement in trade policies within Africa, that will allow for free movement of goods within the continent & thus eliminating local scarcity.


The result to solving these issues will be more resources in the hands of local commodity market players which will, in turn, be translated into better processing of commodities to compete on a global scale, thus bringing Africa back in the game.


The moment local players enjoy the yield of their work, they will be on a self-assigned mission to improve production quality and seek for better and wider market coverage.



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