Widening the Options

2018 ◽  
pp. 411-432
Author(s):  
Richard Newfarmer ◽  
John Page ◽  
Finn Tarp
Keyword(s):  
Structural Change ◽  
Technological Change ◽  
Structural Transformation ◽  
Labour Force ◽  
Value Added ◽  
Industrialized Countries ◽  
African Countries ◽  
Global Marketplace ◽  
Policy Makers ◽  
Will Force

Structural change is taking place in Africa at a pace and with a pattern distinct from the historical experience of today’s industrialized countries. These differences reflect technological change, a changing global marketplace interacting with policy, a rapidly growing labour force and natural endowments. Some African countries, perhaps with coastal locations, will be able to transform their economic structures through manufacturing. However, it would be surprising if the successful African economy of the future closely followed the export-oriented manufacturing-led path that characterized East Asia’s structural transformation. Africa’s growing economies are likely to have economic structures that contain high value-added agriculture, agro-industry and tradable services in addition to a more robust manufacturing base. Global realities will force Africa’s policy makers to think of ways to promote structural transformation into activities beyond manufacturing.

scholarly journals Manufacturing Sector and Economic Growth: A Panel Study of Selected African Countries

2019 ◽  
Vol 4 (3) ◽  
pp. 114-130
Author(s):  
Clement Moyo ◽  
Leward Jeke
Keyword(s):  
Economic Growth ◽  
Manufacturing Sector ◽  
Panel Study ◽  
Commodity Prices ◽  
Value Added ◽  
African Countries ◽  
Policy Makers ◽  
System Gmm ◽  
The Impact ◽  
Determinants Of Economic Growth

Objective – The manufacturing sector plays an important role in any economy. However, Africa has experienced significant deindustrialisation over the last few decades, whilst economic growth has been on an upward trend over the same period. The high growth rates have mostly been propelled by improved macroeconomic stability and the commodity price boom. Further, the slowdown in commodity prices has recently caused a deceleration of economic growth which begs the question: Does promoting the manufacturing sector result in higher and sustainable economic growth and reduce unemployment? This study assesses the impact of the manufacturing sector on economic growth in 37 African countries. Methodology/Technique – This study employs the System-GMM Model for the period between 1990 and 2017. This technique is ideal as the number of cross-sectional units is greater than the number of time periods. This technique also caters for problems of endogeneity and heteroscedasticity. Findings – The results show that manufacturing value has a positive effect on economic growth in African countries. Therefore, it is recommended that policy makers enact measures to boost manufacturing output. Novelty –The deceleration of economic growth in African countries coupled with high unemployment and poverty levels has brought the issue of re-industrialisation into the spotlight. This study is vital for policy makers in African countries who seek to promote economic growth and employment levels. The study contributes to literature in African countries by incorporating variables such as human capital and institutional quality which are major determinants of economic growth. Type of Paper: Empirical. Keywords: Manufacturing Value Added; Economic Growth; African Countries; System-GMM. Reference to this paper should be made as follows: Moyo, C; Jeke, L. 2019. Manufacturing Sector and Economic Growth: A Panel Study of Selected African Countries, J. Bus. Econ. Review 4(3) 114 – 130 https://doi.org/10.35609/jber.2019.4.3(1) JEL Classification: C23, E23, O14, O40.

Structural Transformation in General Equilibrium

2021 ◽  
pp. 156-171
Author(s):  
Alessio Moro ◽  
Carlo Valdes
Keyword(s):  
Structural Change ◽  
General Equilibrium ◽  
Technological Change ◽  
Structural Transformation ◽  
Gdp Growth ◽  
National Accounts ◽  
Investment Good ◽  
Goods And Services ◽  
Income Elasticities ◽  
Real Gdp

This chapter revises the main mechanisms at work in generating structural change in a multi-sector environment, which emerge due to an interaction between consumers’ preferences and technological change and to different income elasticities of goods and services. The chapter further discusses the issue of measurement. The typical assumption in multi-sector models is to define GDP as aggregate output in units of a numeraire good, often chosen to be the investment good. However, this procedure is equivalent to deriving nominal GDP in the data and does not provide a measure of real GDP. We then discuss how GDP in the model should be measured to provide a statistic that is comparable with the data in national accounts. The last part of the chapter shows how structural transformation from manufacturing to services, when appropriately compared to the data, generates a decline in GDP growth and volatility along the growth path of an economy.

BRICS AND SUB-SAHARAN AFRICA TRADE INTERDEPENDENCE AND PEACE: EVIDENCE BASED ON REVEALED COMPARATIVE ADVANTAGES

2015 ◽  
Vol 2 (1) ◽  
Author(s):  
Hailay Gebretinsae Beyene
Keyword(s):  
Structural Transformation ◽  
Economic Integration ◽  
Raw Materials ◽  
Value Added ◽  
Sub Saharan Africa ◽  
Evidence Based ◽  
Policy Makers ◽  
Slow Pace ◽  
Comparative Advantages ◽  
Sub Saharan

This study examined economic integration through trade between BRIGS (Brazil, Russia, India, China and South Africa) countries and sub-Saharan Africa. The study examines the comparative advantages of the two economic blocks with respect to the exportation of merchandise (food, agricultural raw materials, fuels, ores and metals, and manufactures). The findings of this study reveal the actual status of these two regions as economic partners in each of the five subsectors of merchandise exports.The  trend  shows  that,  with  the  exception  of  manufactures  exports, the competitiveness of all subsectors of the merchandise  exports of  BRIGS is characterised by a  declining  trend.  BRIGS has  a  comparative  advantage in the world in the exportation of manufactures and fuels, and comparative disadvantage in the export of food, agricultural raw materials, and ores and metals.  Interestingly, manufactures are  continuously  and consistently  in a steadily rising trend. This is evidence that BRIGS's structural transformation towards higher valued-added commodities is proceeding well, which means that policy makers should be considering ways of enhancing it further.In the case of sub-Saharan Africa, with the exception of manufactures exports, it is found to have comparative advantages in all merchandise exports. Sub- Saharan Africa’s competitive advantage is the highest in the exportation of ores and metals, followed by fuels, agricultural raw materials and food. Sub-Saharan Africa has a comparative disadvantage in the export of manufactures throughout the period considered in this study. This implies that the prospects of structural transformation to downstream of the higher value-added commodities export part of the supply chain are good: the slow pace of transformation towards higher value-added goods should therefore be demanding the attention of policy makers. The study has revealed that sub-Saharan Africa is more competitive than BRICS in the exportation of ores and metals, fuel, agricultural raw materials and food. On the other hand, BRICS is more competitive than sub-Saharan Africa in the export of manufactures.The study has also revealed that significant economic integration can be sustained  between  BRICS  and  sub-Saharan  Africa  in  the  exportation  of all merchandise subsectors. Specifically, sub-Saharan Africa is a potential destination market for BRICS’s exports of manufactures. Conversely, BRICS is also a potential destination market for sub-Saharan Africa’s exports of ores and metals, fuel, agricultural raw materials and food.Economic integration between BRICS and sub-Saharan Africa favourably influences peace and stability in the regions. Sustaining peace and stability in these regions also favourably influences the wellbeing of the communities.

scholarly journals Multi-criteria decision-making model for supporting manufacturing settlements location in Africa after COVID-19

2021 ◽  
Vol 13 ◽  
pp. 184797902110233
Author(s):  
Stefania Bait ◽  
Serena Marino Lauria ◽  
Massimiliano M. Schiraldi
Keyword(s):  
Decision Making ◽  
Value Chain ◽  
Multinational Enterprises ◽  
Value Added ◽  
Plant Performance ◽  
Multi Criteria Decision Making ◽  
African Countries ◽  
Analytic Hierarchy ◽  
Location Selection ◽  
Decision Making Model

The COVID-19 emergency is affecting manufacturing industries all over the world. Notably, it has generated several issues in the products’ supply and the global value chain in African countries. Besides this, Africa’s manufacturing value-added rate grew only 1.5 since 2018, and the foreign direct investment (FDI) from multinational enterprises (MNEs) remains very low due to high-risk factors. Most of these factors are linked to a non-optimized location selection that can adversely affect plant performance. For these reasons, supporting decision-makers in selecting the suitable country location in Africa is crucial, both for contributing to countries’ growth and companies’ performance. This research aims at presenting a comprehensive multi-criteria decision-making model (MCDM) to be used by MNEs to evaluate the best countries to develop new manufacturing settlements, highlighting the criteria that COVID-19 has impacted. Thus, it has affected countries’ performance, impacting the plant location selection choices. A combination of the Analytic Hierarchy Process (AHP) and the Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS) methods have also been used for comparative analysis. The criteria used in the proposed approach have been validated with a panel of MNEs experts.

Economic Structural Transformation in Emerging Market Countries

2021 ◽  
pp. 097491012110046
Author(s):  
Kunling Zhang
Keyword(s):  
Economic Development ◽  
Labor Force ◽  
Structural Transformation ◽  
Service Sector ◽  
Agricultural Sector ◽  
Emerging Market ◽  
Value Added ◽  
Industrial Sector ◽  
Trade Structure ◽  
Emerging Market Countries

This article analyzes the structural transformation in 30 emerging market countries (E30) on the dimensions of industry, trade, and urbanization. It finds that first, in the agricultural sector, E30 have contributed greatly to the increase of the global agricultural productivity and the transfer of labor force from the agricultural sector to industry or the service sector. However, these countries still feature a high percentage of agricultural employment, which means there is vast room for shifting the agricultural labor force. Second, in the industrial sector, E30 have made remarkable contributions to the world’s industrial development but have also displayed a trend of premature “deindustrialization.” Third, the service sector has picked up speed and gradually turned into a new driver of economic development in E30. Against this backdrop, E30 face the major challenge of how to cope with the premature deindustrialization and smoothly shift the economic growth engine from the industrial sector to the service sector. Fourth, E30 have become an important force in the world trade, with their trade structure switching from simple, primary, low-value-added goods to sophisticated, high-grade, and high-value-added goods and services. However, some emerging market countries are more susceptible to the impacts of the anti-globalization trend because of their high reliance on foreign trade and improper trade structure. Therefore, how to diversify the economy and enhance its economic resilience holds the key to the sustainable economic development of E30. Fifth, E30 have contributed greatly to world urbanization. As urbanization relies more on the service sector than on the industrial sector, it is vital to properly strike a balance between industrialization and urbanization, and between industrialization and service sector development.

Infrastructure deficit and opportunities in Africa

2017 ◽  
Author(s):  
Albert Mafusire ◽  
Zuzana Brixiova ◽  
John Anyanwu ◽  
Qingwei Meng
Keyword(s):  
Private Sector ◽  
Low Income ◽  
Private Investment ◽  
Low Income Countries ◽  
Infrastructure Development ◽  
African Countries ◽  
Policy Makers ◽  
Private Sector Investment ◽  
Investment Opportunities ◽  
Financing Infrastructure

Private sector investment opportunities in Africa’s infrastructure are huge. Regulatory reforms across African countries are identified as critical to the realization of the expected investment flows in the infrastructure sector. However, planners and policy makers need to note that there are infrastructure deficiencies in all subsectors with low income countries (LICs) in Africa facing the greatest challenge. Inefficiencies in implementing infrastructure projects account for USD 17 billion annually and improving the capacity of African countries will help minimize these costs. In this regard, the donor community must play a greater role in African LICs while innovative financing mechanisms must be the focus in the relatively richer countries of the continent. Traditional sources of financing infrastructure development remain important but private investment is critical in closing the current gaps. Countries need to devise mechanisms to exploit opportunities and avoid pitfalls in investing in infrastructure.

scholarly journals Students from Portuguese Speaking African Countries in Portuguese Higher Education

2021 ◽  
Author(s):  
Joyce Aguiar ◽  
Cristina Sin
Keyword(s):  
Higher Education ◽  
Labour Force ◽  
Steady Increase ◽  
Highly Qualified ◽  
African Countries ◽  
Institution Type ◽  
The Public ◽  
Studying Abroad ◽  
Portuguese Higher Education ◽  
Degree Level

Recently, African countries have been making efforts to expand their higher education systems. However, neither capacity nor quality have kept pace with demand, leading to a steady increase in students studying abroad. In this paper, we aim to analyse the development of enrolments in Portugal, one of the main destinations for students from Portuguese-speaking African countries (PALOP). Descriptive analyses were performed, disaggregating enrolments according to degree level, disciplinary area of study, and institution type. The results show that the choices of students from PALOP countries have followed different trajectories, in some cases with similarities. The public sector has the largest presence of these students, and polytechnic institutions have been the most frequent choice. Most of the students were enrolled in first degrees, except for those from Mozambique. Enrolments in Health, Services and "hard" sciences have increased, which may reflect the growing demand for highly qualified labour force in these countries. This paper highlights the continued importance of PALOP students for the internationalisation of Portuguese higher education and the need to avoid considering them as a homogeneous group of students.

scholarly journals Industries without Smokestacks

2018 ◽  
pp. 232-253 ◽  
Author(s):  
António S. Cruz ◽  
Fausto J. Mafambissa
Keyword(s):  
International Economic ◽  
Low Income ◽  
Fruits And Vegetables ◽  
Labour Force ◽  
Value Added ◽  
Growth Strategy ◽  
Low Income Countries ◽  
Gross Domestic Product Growth ◽  
Aggregate Growth ◽  
Total Labour

Under the current international economic conditions, where Asian countries are strong competitors in the manufacturing commodities, low-income countries like Mozambique could attempt to compete in industries without smokestacks. Fruits and vegetables, agro-processing goods, and various tradable services are estimated to have contributed 1.9 per cent to annual average gross domestic product growth in 1993–2015, when the aggregate growth was 7.8 per cent. Around 80 per cent of the total labour force is dedicated to primary activities, producing 25 per cent of the aggregated value added in 2013–15. The share of services in total exports was only 17 per cent in 2012–14. Although still relatively small, these industries have potential for growth, if Mozambique follows a diversified growth strategy.

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