The rise and fall of (Chinese) African apparel exports
Lorenzo Rotunno (),
Pierre-Louis Vézina () and
Zheng Wang ()
No 2012-12, CSAE Working Paper Series from Centre for the Study of African Economies, University of Oxford
During the final years of the Multifiber Agreement the US imposed strict import quotas on Chinese apparel while it gave African apparel duty- and quota-free access. The combination of these policies led to a rapid but ephemeral rise of African exports. In this paper we argue that the African success can be explained by a temporary transhipment of Chinese apparel driven by quota-hopping Chinese assembly firms. We first provide a large body of anecdotal evidence on the Chinese apparel wave in African countries. Second, we show that Chinese apparel exports to African countries predict US imports from the same countries and in the same apparel categories but only where transhipment incentives are present, i.e. for products with binding quotas in the US and for countries with preferential access to the US unconstrained by rules of origin. Using input-output linkages, we then show that African countries imported quasi-finished products with little assembly work left to do, rather than primary textile inputs. We estimate that direct transhipment may account for around half of AGOA countries apparel exports.
Keywords: Transhipment; AGOA; Multifiber agreement (search for similar items in EconPapers)
JEL-codes: F13 O17 O19 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr, nep-dev and nep-int
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Journal Article: The rise and fall of (Chinese) African apparel exports (2013)
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