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Can Intra-Regional Trade Act as a Global Shock Absorber in Africa?

Zuzana Brixiová (), Qingwei Meng () and Mthuli Ncube ()
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Qingwei Meng: African Development Bank

No 154, SALDRU Working Papers from Southern Africa Labour and Development Research Unit, University of Cape Town

Abstract: The global financial crisis and the subsequent uneven recovery have underscored the need for Africa's resilience to output and other shocks originated in the rest of the world. A comparison of two regional economic communities – the East African Community (EAC) and the Southern Africa Customs Union (SACU) – suggests that deeper intra-regional, and in particular intra-industry, trade ties have contributed to the EAC's resilience to external output shocks. More broadly, intra-regional and intra-African trade with fast-growing economies, together with geographically diversified trade links, can strengthen the capacity of African countries to absorb global output shocks. Besides helping shield countries from external shocks, intra-regional trade also supports economic diversification and participation in regional value chains.

Keywords: Intra-regional trade; output co-movement; regional economic communities; Africa (search for similar items in EconPapers)
JEL-codes: E32 F4 F15 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac
Date: 2015
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Journal Article: Can Intra-Regional Trade Act as a Global Shock Absorber in Africa? (2015) Downloads
Working Paper: Can Intra-Regional Trade Act as a Global Shock Absorber in Africa? (2015) Downloads
Working Paper: Can Intra-Regional Trade Act as a Global Shock Absorber in Africa? (2014) Downloads
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