International Handbook on the Economics of Integration, Volume I
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International Handbook on the Economics of Integration, Volume I

General Issues and Regional Groups

Edited by Miroslav N. Jovanović

With this Handbook, Miroslav Jovanović has provided readers with both an excellent stand-alone original reference book as well as the first volume in a comprehensive three-volume set. This introduction into a rich and expanding academic and practical world of international economic integration also provides a theoretical and analytical framework to the reader, presenting select analytical studies and encouraging further research.
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Chapter 20: Economic Integration in Sub-Saharan Africa

Lisa Borgatti


Lisa Borgatti* 1 INTRODUCTION Contemporary regionalism in the South is very different from the regionalist attempts in the 1960s, which were predominantly of political inspiration. The current African regionalism is grandiose in its scope as it attempts to create a common economic space among participating countries. Free trade areas are to be merged into a common African customs union, leading by 2028 to a single African currency issued by an African central bank. The number of South–South agreements has increased dramatically in the last decade. Between 1990 and 2003, 70 new South–South trade agreements were signed, 30 of which were between neighbouring African countries (Yang and Gupta, 2005). This follows the natural trading partners’ argument, that is, neighbouring countries tend to trade more, as most South–South agreements are implemented between neighbours that are rather far away from the main world markets. The low level of intra-Sub-Saharan Africa trade is often referred to as one of the most important reasons – together with political and economic considerations – that underlie the growing number of regional trade agreements within Africa. Countries of similar income per capita should trade more intensely with one another (Linder hypothesis) in similar but differentiated goods. The limited intra-regional trade and marginalisation in world markets leaves a high unexploited potential, which policy makers attempt to grab through increased regionalism, resulting in overlapping memberships (see Figure 20.1). Each African country, on average, belongs to four regional trade arrangements. Increased regionalism is not exclusive to Africa. Regional trade agreements...

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