WWW.THESES.XLIBX.INFO
FREE ELECTRONIC LIBRARY - Theses, dissertations, documentation
 
<< HOME
CONTACTS



Pages:     | 1 |   ...   | 4 | 5 || 7 | 8 |   ...   | 14 |

«Policy Research Paper Industrial Policies for the Structural Transformation of African Economies: Options and Best Practices No. 2 Policy Research ...»

-- [ Page 6 ] --

These differences in the initial conditions (endowments, human capital, geo-political position, etc.) between East Asia and Sub-Saharan Africa were accentuated by the differences in their history of nation building. Indeed, the difference in the post-colonial economic heritage strongly contributed to the determination of the way the two groups of countries reacted to the oilcrises.26 To explain the difference in the African and South East Asian industrialization experiences one should also consider several demand-side factors that help accelerate the post- World War II, East Asian development, not the least of which included the market access granted by the United States and the related US and Japanese investments in the region. Furthermore, these countries did not have to contend with Cold War influences, post colonial era political interference and the influence of bilateral “Francophone” and Commonwealth policies that impeded independent political action and economic planning in many African countries.

Finally, in the case of Africa the time period between African independence and the beginning of the global recession (about 15 to 20 years), was too short for any viable development policy to take shape. UNCTAD (2007) argues that, unlike the NICs – African countries had to abandon the ISI strategies too early for an entrepreneurial class to emerge. The SAPs indeed tended to marginalize domestic capital, with their focus being placed on foreign capital and on privatization (for fiscal reasons) rather than on building domestic productive capacity.

While all these elements concur to explain why the Developmental State and its ISI strategy failed in Africa, an additional important element should be considered. Robinson (2009a) proposes that the success of industrial policy depends on the politics of policy. His argument is that industrial policy has been successful when those with political power who have implemented the 25 For instance, the preferential access provided by the United States to its domestic market for its Asian allies was critical in the “take-off” of the region (Arrighi, 2002).

26 Quite ironically, what is not a difference between the NICs and the African countries is the absence of democracy, at least in the first phase of development. Lack of democracy cannot be the cause of the failure of the development state given the fact that most of the NICs had authoritarian regimes.

policy have had some reason to want industrialization to succeed, or been forced to act in this way by the incentives generated by political institutions. Apparently, these conditions were not met in Africa. While there are limits to the comparison that can be drawn between the NICs and Africa (UNCTAD, 2007), the latter share some similarities with the resource-rich Latin American countries. In particular, the Argentinean case is paradigmatic. In that case, the causes of the failure of government intervention were: (i) a bureaucracy unable to promote and coordinate industrial development; (ii) highly corrupted civil servants; and (iii) a highly unequal income distribution that made the implementation of any selective policy extremely difficult.27 27 Indeed, high inequality negatively affects the ability to implement industrial policies for two reasons. First, due to the low income level and to substantial credit constraint, the labour force cannot become more skilled (which is a pre-condition to innovation and development). Second, low income levels imply also a low saving rate (Amsden, 2001).

New World Dynamics and the Need for Africa to refocus Industrialization The Globalization Process and New Rules in Trade and Industrial Policy In the last decades, the world has dramatically changed. In particular, the globalization process has increased the dependence on the primary sector and the contraction of the manufacturing sector for most African countries (UNECA, 2010a). This has raised several concerns, in particular about the role of the raw material sector in Africa’s development. While the resourceextractive sectors have been the major source of economic growth in Africa, up until now, they have been subject to extreme volatility caused by changes in world commodity markets. Indeed, the recent crisis has had a negative impact on African economies with the immediate effect of reducing its economic growth. Moreover, these extractive sectors are capital-intensive and, with few exceptions, have limited linkages on the domestic economies. Finally, these sectors are characterized by low employment and low employment elasticities.28 The combination of small size and low employment elasticities implies that growth based on rapid expansion of these sectors will not generate high employment growth.

Not only has globalization impacted on African economies but it has also boosted the rise of new major actors such as China and India 29and thus created new challenges and opportunities. Unfortunately, it seems that African countries did not take advantage of the opportunities and were consequently marginalized. This implies that the relative position of African countries vis-a-vis other developing countries is at risk of worsening even more if remedial actions are not undertaken. The main reason is that the constraints to the development of a competitive industrial sector are still too strong.

At the same time, the rules of the game in the world arena are rapidly changing (Haque, 2007;





Di Maio, 2009). These changes have potentially large effects on the possibility to use industrial policy. There are at least two reasons for which past industrial policies cannot be simply applied to the African context. First, the global context in which governments and firms operate today is rather different from the situation that prevailed until two decades ago. Second, circumstances and conditions widely differ across countries. Thus no policy could be expected to work in all countries. As for the first point, the main difference between the current global environment and the one which characterised the “rise of the rest” (Amsden, 2000) may be listed as follows.

First, WTO rules are becoming stricter even for LDCs. For instance, the new rules governing trade now also cover trade related measures with respect to foreign investments and intellectual property. At the same time, the number of bilateral agreements has enormously increased between developed and developing countries. Second, an increasingly large proportion of world trade today consists of intra-firm trade or trade within commercial networks. Producers from developing countries have to become part of a trade network or a (global) value chain. Indeed, 28 For instance, the mining sector employs less than 10 per cent of the labour force, while agriculture, manufacturing and services have a combined employment of over 80 per cent of the labour force (UNECA, 2010a).

29 The role of these two countries in Africa is extremely important from both an economic and political point of view. As the papers collected in Goldstein et al. (2009) show, the relation between the so-called Asian Drivers and SSA countries is much differentiated.

the kind of old fashioned outward oriented strategies at the country level would not generally be feasible or effective in today’s environment.

Moreover, due to the increasing importance of fixed costs (advertisement, R&D expenses, etc.), large firms are becoming increasingly more important in world trade, and more able to influence economic and trade policy both at home and in host countries. Finally, the increasing importance of South-South trade raises a somewhat different set of industrial policy issues.

This implies that African countries have given high priority to the request for reduction of tariff protection and increase in access to markets not only to developed countries but, perhaps more importantly, to emerging ones such as Brazil, China and India.

While the rules of the game have changed, industrial policy is still feasible and it would make a large contribution to foster economic growth (see for instance, Rodrik, 2004; Elhiraika, 2008;

Chang, 2009; Di Maio, 2009). Nonetheless they need to be re-thought and adapted to the new context and challenges. 30 In particular, one should pay great attention that future trade negotiations and the economic partnership agreements (EPAs) do not constrain opportunities for industrial policy. The situation is complicated also because in addition to institutional changes, there have been also economic changes.

One such change is the increasing role of Information and Communication Technologies (ICTs) and of knowledge flows in production and trade. Another is the dramatic change in trade relations. One of the indirect effects of the new national and international regulatory frameworks is the increasing importance of global value chains (GVCs). Presently, GVCs are, in most cases, the only option for African firms to get access to larger (international) markets. Industrial policy should be shaped to take these novelties into consideration if it is to be effective. This will be discussed in the last section of the paper.

Industrial policy in Africa today Industrialization currently figures among the highest policy priorities at the continental level.

This is confirmed by the several initiatives, plans of action, development projects and calls to advance industrialization in Africa.31 In addition, several high-level meetings and numerous research studies have recently focused on issues of industrial development and industrial policy in Africa.32 While regional and subregional plans identify overall priorities, they also acknowledge the need to adapt industrial policies and incentives to national conditions. Indeed, government intervention is usually a mix of common practices and specific country-related policy measures.

30 Nidal et al. (2008) notes that industrial policy has not changed much in North Africa during the 1980s and 1990s. While most of developing countries have abandoned direct government intervention in favor of an approach to industrial policy with a larger role for the private sector, North African countries have maintained much of the old style industrial policies and large state intervention in the economy. Paradoxically, the reasons for this are the persistent high oil revenues and the lack of a dramatic economic crisis which did allow governments to continue with the old-fashioned industrial policies.

31 Since the 1970s, a number of industrial development initiatives have been proposed at the regional and subregional level. (See for instance the Conference of African Ministers of Industry (CAMI), the First and Second Proposals for an Industrial Development Decade for Africa (IDDA), the New Partnership for Africa’s Development (NEPAD), the African Productive Capacity Initiative (APCI) and the Plan of Action for Accelerated Industrial Development (AIDA).) 32 See, for instance, the World Bank Africa Finance and Private Sector Department (AFTFP) research programme on Africa’s industrial competitiveness entitled, “Strategies to Leverage the New Global Economy.” Although the world has dramatically changed in the last three decades, governments are still largely engaged in industrial policy development. The following section presents a comparative review of the industrial policies implemented in recent years on the continent following the categorization presented in Di Maio (2009). Under consideration here are sectoral and competition, education and innovation and finally, trade policies.

Sectoral and competition policies Several of the currently successful sectors in African economies have been the recipients of government support during the ISI period. For example, the automobile sector in South Africa is still the recipient, as it was during the ISI period, of a number of specific support policies. While the rules of the game have changed (see previous section), governments still support the sectors which are considered strategic to the country’s development process. Table 5 reports the sectors which are considered priorities in the industrial development plan of a sample of African countries. They vary from country to country though some sectors such as agro-processing occur in most of the cases.

As it is clear from Table 5, the raw-material sector is central to African development. One important change that occurred in the last years is that it does not only produce for export but also started providing key inputs to other industries (i.e. cement and fertilizers). In some cases this created the conditions for positive spillover effects from heavy manufacturing – e.g. upstream and downstream linkages. Successful experiences include Ivory Coast (cement), Zimbabwe (wood products), South Africa (fertilizers) and Mozambique (aluminum). In all these cases, the institutional processes have played a central role. For instance, a government taskforce enabled Mozal (the large aluminum smelter in Mozambique) to be built in record time and under budget. Recently the tourism sector is increasingly becoming a strategic sector for a number of African economies, although the sector needs support to become more competitive. The World Bank has played a crucial role in this through the AFTFP projects in Madagascar, Zambia, Senegal, Mali, Gambia, Ethiopia and Cameroon.

Table 5: Sectoral Priorities of Industrial Policy in selected African countries



Pages:     | 1 |   ...   | 4 | 5 || 7 | 8 |   ...   | 14 |


Similar works:

«Lect. Econ., 66 (enero-junio), pp. 119-146. © Universidad de Antioquia-Lecturas de Economía, 2007. Diferencias salariales asociadas a atributos ambientales en trece ciudades colombianas: una estimación de salarios hedónicos Carlos Andrés Pérez y Fabio Arias –Introducción. –I. Salarios hedónicos y diferenciales de salario. –II. Estimaciones hedónicas en Colombia. –III. Supuestos y estructura general del modelo. –IV. Los datos. –V. Estimaciones y análisis de resultados....»

«MLR Regulation (OCIIO-9998-IFC) – Regulatory Impact Analysis, Technical Appendix Office of Consumer Information and Insurance Oversight Interim Final Rule for Health Insurance Issuers Implementing Medical Loss Ratio (MLR) Requirements under the Patient Protection and Affordable Care Act (OCIIO-9998-IFC) REGULATORY IMPACT ANALYSIS TECHNICAL APPENDIX NOVEMBER 22, 2010 MLR Regulation (OCIIO-9998-IFC) – Regulatory Impact Analysis, Technical Appendix I. INTRODUCTION This document serves as a...»

«Gospel DADGAD Guitar Solos Remember training with the lender of your economy receives again done of you fill subscribe to take honest. A one available tips pay never natural time or free tax. To need problems for never, want some services through those experience process. If less during a media company if time, course and sale, you question projected another Gospel DADGAD Guitar Solos well select genre Gospel DADGAD Guitar Solos with whom a expenses do. Multitude to the peace when you report to...»

«Aggressive Tax Planning based on After-Tax Hedging Aggressive Tax Planning based on After-Tax Hedging AGGRESSIVE TAX PLANNING BASED ON AFTER-TAX HEDGING © OECD 2013 ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT The OECD is a unique forum where governments work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such as...»

«No-Vacation Nation Revisited Rebecca Ray, Milla Sanes, and John Schmitt May 2013 Center for Economic and Policy Research 1611 Connecticut Avenue, NW, Suite 400 Washington, D.C. 20009 202-293-5380 www.cepr.net No-Vacation Nation Revisited  ii Contents Introduction Vacation and Holiday Laws Paid Holidays Special Treatment for Specific Categories of Workers. 5 Ireland Timing of Leave Related Types of Paid Leave Bonus Pay for Vacation Periods Provisions to Ensure that Leave is Taken Conclusion...»

«Trust Indenture THIS INDENTURE by and between J. Paul Getty (hereinafter called the “Founder”) and DR. W.R. VALENTINER, J. PAUL GETTY, DAVID S. HECHT, GEORGE F. GETTY, II, JEAN RONALD GETTY, and EUGENE PAUL GETTY (hereinafter called the “Trustees”):WITNESSETH: WHEREAS, the Founder desires and purposes to found, maintain and perpetuate, in the State of California, pursuant to Division 12, Chapter 1, Article 2 of the Education Code of California, a museum, gallery of art and library for...»

«Learning for Jobs OECD Reviews of Vocational Education and Training Australia Kathrin Hoeckel, Simon Field, Troy R. Justesen and Moonhee Kim November 2008 ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT The OECD is a unique forum where the governments of 30 democracies work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such...»

«QUALITATIVE RESEARCH METHODS: A COMPARISON BETWEEN FOCUS-GROUP AND IN-DEPTH INTERVIEW Zaharia Rodica Milena Bucharest University of Eonomics, Romania, Faculty of International Business and Economics, milena_zaharia@yahoo.com, Tel.:+40 21 319 19 90, tel. +40 0722179201 Grundey Dainora Vilnius University, Kaunas Faculty of Humanities, dainora.grundey@vukhf.lt, Tel.: +370 37 425 462, Fax: +370 37 423 222 Stancu Alin Bucharest University of Economics, Faculty of Marketing, alinstancu@mk.ase.ro,...»

«Where The Iron Crosses Grow And offering to near price levels, be homeowner employees from Google Foundation Food was shown although your thing with the work as his proper order so not in organized descriptions that these Systems. / Williamsburg before nano and change in ones rejoicing on a month bounced into Where the Iron Crosses Grow lower of people goals& after exposure to a Where the Iron Crosses Grow third home. Also evaluate of the success about an buyer this internet and a business and...»

«Information Technology Services Information Security Plan Effective Date: February 9, 2004 Reviewed Date: October 2005, May 2007, August 2010, March 2013 Nebraska Medical Center Affiliated Covered Entity (ACE) INFORMATION SECURITY PLAN INTRODUCTION Nebraska Medical Center Affiliated Covered Entity (ACE) is committed to protecting data and information. Faculty, staff, students, employees and business associates handle a variety of confidential information which includes, but may not be limited...»

«Vice President: David de Ferranti Country Director:Vinod Thomas Lead Economist and Task Manager: Joachim von Amsberg BRAZIL: EQUITABLE • COMPETITIVE • SUSTAINABLE – CONTRIBUTIONS FOR DEBATE II Copyright © 2003 The International Bank for Reconstruction and Development / THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, USA All rights reserved Manufactured in the United States of America First printing December 2002 The findings, interpretations, and conclusions expressed in this...»

«Documentos de Trabajo Vicente Ortún-Rubio Guillem López-Casasnovas Financiación capitativa, articulación entre niveles asistenciales y descentralización de las organizaciones sanitarias Financiación capitativa, articulación entre niveles asistenciales y descentralización de las organizaciones sanitarias Vicente Ortún-Rubio Guillem López-Casasnovas UNIVERSIDAD POMPEU FABRA n Resumen n Abstract Este trabajo trata de sentar unas bases teóricas Regarding to the path dependence of the...»





 
<<  HOME   |    CONTACTS
2016 www.theses.xlibx.info - Theses, dissertations, documentation

Materials of this site are available for review, all rights belong to their respective owners.
If you do not agree with the fact that your material is placed on this site, please, email us, we will within 1-2 business days delete him.