According to Florizelle Liser, assistant US trade representative for Africa, trade is the key to long-term, sustainable economic growth and development in Sub-Saharan Africa.
The 8th Annual African Growth and Opportunity Act (AGOA) Forum, that took place in Nairobi, Kenya, between August 4-6, was an important venue for cultivating trade opportunities, according to Liser in a July 21 interview with America.gov. Trade is critical to Sub-Saharan Africa’s economic future and improving lives and livelihoods.
Even as African nations continue to engage in digital investments, trading remains crucial. As prospects source for the best trading app in South Africa for stocks and related investments, the art of importing and exporting is a long-term economic booster for Africa.
“Trade is critically important to economic development. Right now, Africa has about 2 percent of all world trade, which is hard to believe when you think about all of the tremendous resources that they have – oil, diamonds, gold … not to mention all the agricultural products such as coffee, tea, cocoa – and to think that Africa still only has 2 percent of world trade is really incredible. But the power of trade is that if the Africans were able to increase their share of world trade from 2 to 3 per cent, that 1 percentage increase would actually generate about $70 billion of additional income annually for Africa,” or about three times the total development assistance Africa gets from the entire world, Liser said.
Why do countries engage in trade?
Countries trade with one another when they lack the resources or aptitude to meet their own needs and goals on their own. Countries can create a surplus and exchange it for the resources they require by developing and utilizing their own limited resources.
Long-distance trade has been documented for at least 9,000 years, however it is likely that long-distance trade predates the domestication of pack animals and the development of ships. International commerce is now at the core of the global economy, and it is responsible for most of the modern industrialised world’s progress and wealth.
For a variety of reasons, goods and services are likely to be imported from outside. Imports might be less expensive or of higher quality. They may also be more convenient to get or simply more enticing than items made locally. In many cases, there are no local options, thus importing is required. This is shown today by Japan, which has no oil reserves of its own yet is the world’s fourth largest user of oil, requiring imports to meet its needs.
Liser recently spoke with Tanzanians about the AGOA plan they’re working on. Tanzania provides the cotton for Venus Williams’ tennis outfits, which are also produced at a Tanzanian facility. “I challenged them. I said you only have one plant. You have all this cotton. You have cotton farmers who would benefit if you could create more of these factories,” which in turn could employ many more people. “The problem is that, as is true with most of the AGOA countries, you have huge potential but you don’t have the investment and the focus on how to take that and duplicate and multiply that.” The clothing industry is a “gateway to industrialization,” she added.
