New WTO information note reveals changing pattern in Africa’s trade in intermediate goods, WTO News, Dec. 15, 2023.
The WTO on 15 December released an information note on Africa’s trade in intermediate goods (IGs), providing a snapshot of the region’s growing participation in supply chains. The latest data covering 2010 to 2021 indicates an expansion in Africa’s exports and imports of intermediate goods while also pointing to a high concentration of exports to a few economies and a comparatively narrow range of products. The note also reveals a relatively small share of intra-African transactions.
Africa's exports of IGs amounted to US$ 265 billion in 2021, growing an average of 15% yearly from 2019 to 2021 according to the information note. IGs refer to inputs (excluding fuels for the purposes of this note) used to produce a final product and are an indicator of the activity in supply chains. Africa's IG exports represented three-quarters of its total merchandise exports in 2021. The region's imports of intermediate goods, meanwhile, was worth US$ 284 billion, with annual average growth of 5% for 2019 to 2021. These growth rates are higher than the 5% and 2% average increases for IG exports and imports respectively for 2010-2021.
The surge in IG exports was mainly driven by the supply of mostly raw or semi-processed ores, minerals, metals and agricultural products, which saw higher prices on global commodity markets in the aftermath of the COVID-19 pandemic. The majority of Africa's IG imports, in contrast, was for industrial supplies (62% share of total IG imports) while food and beverages accounted for 15%. The exchanges of industrial inputs between China and Africa grew at a fast pace between 2010 and 2021, averaging annual growth of 10%.
The information note also highlights that the region's IG exports are concentrated among just a few economies, led by South Africa which accounts for 30.9% of the region's total IG exports, and a relatively small range of products. Moreover, the share of intra-African trade in total IG exports, a proxy for trade in regional supply chains, was estimated at 13% in 2021. This may be an under-estimate due to a paucity of reported data and the partial or non-coverage of informal trade in official statistics, which is significant in the region.
The full information note is available here.