Posts

The ECO-ICBT database of cross-border trade in agricultural products in ECOWAS

Recent reports and economic literature clearly show that intra-African trade is not well measured by official databases, such as those compiled by NSOs and international institutions. This is especially true in West Africa since ECOWAS eliminated duties on intraregional trade. ECOWAS is a customs union with free trade among member countries for Produits du cru (local products). The lack of high-quality trade data is largely explained by the weakness of formal data collection systems (hampered by under-declaration, misclassification, lack of incentives for customs agents due to exoneration of customs duties, and so on). Yet accurate trade statistics are paramount for designing policies for food security, monitoring progress toward important goals (such as the Malabo target or the African Continental Free Trade Area), and providing the private sector with valuable information.

This document describes the new ECO-ICBT (ECOWAS Informal Cross Border trade) database of cross-border trade in agricultural and food products among ECOWAS countries, Chad, and Mauritania. Trade data on 178 products, corresponding to 67 HS6 codes, are collected by AOCTAH-WACTAF every day in all marketplaces and along all corridors of the region, through a collaboration with apex organizations in agrifood sectors. The data collection methodology is presented as well as statistics on the trade of agri-food products between ECOWAS countries, Chad, and Mauritania for 2017, 2018, 2019, and 2020. These statistics are then compared to those from COMTRADE, the United Nation’s trade database.

Analysis of the ECO-ICBT data reveals that intraregional trade is dominated by animals, animal products, and maize. These products represent more than 50 percent of intraregional trade flows by value. Over the entire period of observation, road transportation is the main mode used by traders, and the main means of transport are trucks and mini-trucks.

The systematic comparison of ECO-ICBT and COMTRADE data reveals that on trade flows recorded by ECO-ICBT, the COMTRADE database misses between 97 and 99 percent of trade recorded by ECO-ICBT. Therefore, we conclude that the COMTRADE database provides extremely poor coverage of intraregional trade in agriculture, food, and fishery products in West Africa and that the ECO-ICBT database fills a critical statistical gap.

 

Download the complete document here

 

Diagnostic of Trade policies, measures, and instruments on agriculture in West Africa

Trade is seen as an engine for growth, development, and food security. It has provided a pathway out of poverty for millions of people (ITC, 2017) by promoting the growth of enterprises, lowering prices, and providing consumers with a large choice of products. At the continental level, enhancing intra-African trade in agricultural products is today considered a priority objective by African governments and the African Union.

Thus, the Malabo declaration of 2014 sets the goal of tripling the intra-African trade of agricultural commodities by 2025. In addition, the African Continental Free Trade agreement constitutes a major leap in the way of boosting intra-African trade. Also as highlighted by Odjo et al, (2013), regional trade has a huge potential in stabilizing domestic food markets in Africa as national productions are not as correlated as one might think.

West Africa has both global and intra-regional trade potential. However, this potential is not fully exploited. Indeed, ECOWAS exports are characterized by low product diversity, high dependence on extractive products, and a limited number of agricultural products (cocoa, rubber, cotton). Agricultural exports represent only 10% of total ECOWAS exports and cocoa alone accounts for 60% of this 10%. Imports are more diversified and consist largely of manufactured products and food products (rice, wheat). Thus, this low level of exports diversification is not conducive to processing, local added value, and economic development.

However, intra-regional trade is in place but is largely based on the informal trade system. The strengthening of this trade is considered essential for sustainable economic development and the achievement of food security. Indeed, it creates opportunities and allows the circulation of food products from the most abundant areas to areas with food deficits.

West Africa has 37% of the population of sub-Saharan Africa and is one of the fastest-growing populations in the world. Thus, food security becomes an important aspect to be considered through policies (trade policy, food security…). Thus, many factors challenge the policies and trade strategies to be implemented to achieve this.

This report will diagnose trade policies, measures, and instruments in the ECOWAS region with a focus on agriculture and food products, using both official and other reliable statistics such as the ones collected by CILSS before and under the FARMTRAC project.

There are two ways to measure trade policies. The first approach uses the cost they generate and the second one is the impact they have on trade flows. Therefore, the report is divided into three parts. First, the indicators of trade costs are analyzed, then the indicators of trade integration based on trade flows, and finally the indicators of quality of trade integration are depicted.

Download the complete document here