Part 2: Issues in Sustainable Development

Trade

SummaryTrade

The trade balance between exports and imports varies by country in Africa, but for most it is negative. There are multiple forces at work. These include national debt, unfair agricultural subsidies among trading partners, lack of business infrastructure, the cost of fuel, and dependence on primary products, natural resources, and rain-fed agriculture.

Main Idea

Improving global competiveness by implementing growth-oriented macroeconomic and structural reforms while protecting the environment

Key Concepts

      • Trade liberalization
      • Agricultural subsidies
      • Tourism

Outcomes

Knowledge of

      • the importance of primary commodities in African trade
      • unfair agricultural subsidies and other trade barriers

Understanding of

      • Africa’s position of dependency in the global economy
      • vulnerability to swings in natural resources prices
      • advantages and disadvantages of eco-tourism

Ability to

      • explain an example of the effects of international trade on wages in Africa
      • explain an example of intra-African trade imbalance

Core Readings

  1. Africa Economic Development
    Summary of Africa’s economic position, including oil shocks, indebtedness, and natural resource dependence (1 page)
  2. Africa Environment Outlook, Chapter 8: Interlinkages: The Environment and Policy Web, ”Trade and Industry,” pages 272-273
    Africa’s position of dependency in the global economy and vulnerability to swings in natural resources prices (2 pages)
  3. Trade Liberalization and Globalization
    Detailed review of unfair agricultural subsidies and other trade barriers
    (4 pages)
  4. Africa Environment Outlook, Chapter 3: Land, “Tourism,” pages 88-90 Advantages and disadvantages of eco-tourism (3 pages)

Sustainability Strategies          

  1. The Destination of Exports Determines Wages in Sub-Saharan Africa
    Wage comparison of regional trade versus international trade (1 page)
  2. Trade-Africa: Kenya Strengthens its Ties to South Africa
    Example of the local impact of intra-African trade (1 page)

Supplemental Readings

  1. Africa Environment Outlook, Chapter 8: Interlinkages: The Environment and Policy Web, “Seizing Opportunities,” pages 291-294
    Call for international trade regime to correct the uneven playing field; economist Jeffrey Sachs’ call for increased and better-targeted development aid to Africa (4 pages)
  2. Free but Fair Trade
    News article describing problems with agricultural subsidies (4 pages)
  3. Non-Tariff Agricultural Barriers
    Overview of conflict between health concerns of importing countries and cost for developing country exporters (2 pages)
  4. Trends in Agricultural Trade
    Graphics and statistics from developing countries (14 pages)
  5. Poverty Impacts of International Trade Reforms
    Sophisticated explanation of how trade reform affects farmer and consumer prices; capacity of households to adjust to terms of trade shocks; conclusions are positive, plus concern for safety nets (20 pages)
  6. Trade and Rural Development
    Good discussion of trade liberalization impacts and how they can be mitigated to promote rural development (32 pages)

Assignment Questions

  1. Trade: Explain some concerns associated with high dependence on primary commodity exports.
  2. Interconnections: Trade & Agriculture: Explain how agricultural subsidies in developed countries affect farmers in developing countries.
  3. Trade: Summarize the advantages and disadvantages of ecotourism.