CHAPTER 5
Assessing the Global Value Chain Links between Asia and Sub-Saharan Africa Heiwai Tang, Douglas Zhihua Zeng, and Albert G. Zeufack
Introduction Since 2000, China and other Asian countries such as Bangladesh, Cambodia, India, and Vietnam have become important trade and investment partners with Sub-Saharan African countries. Some of these Asian trading partners have lost their own growth momentum, and there have also been concerns that their economic engagement may have reduced Sub-Saharan African countries’ local industrial capability, causing them to be more dependent on Asian economies. For Sub-Saharan Africa to tap into the trade-and-growth spiral, it needs to diversify—away from some of the traditional high-income economy trading partners, whose growth is slowing, and away from commodity exports, which often exhibit high price volatility. The growing middle class in and increasing demand from Asia, especially East Asia, along with the shifting structure of global value chains (GVCs), may offer new economic opportunities for Sub-Saharan Africa. This c hapter assesses the value chain links between Sub-Saharan Africa and Asia, summarizing the current status and future potential of African products in emerging Asia. The study offers insights on how the region’s economies can expand their market potential and advance their industrialization and economic diversification agendas. Key Findings One of the lessons from this chapter’s detailed sector-level analysis of Sub-Saharan African countries’ exports to Asia is that each nation in the region has its own experience of trading with Asia—in terms of structural change, diversification dynamics, and specialization patterns. Although exports from Sub-Saharan Africa to Asia remain highly concentrated in
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