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International Trade and Poverty Reduction in Africa-An Evaluation - Term Paper Example

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The review in the paper "International Trade and Poverty Reduction in Africa-An Evaluation" shows that the effects of trade liberalization on poverty in Africa cannot be generalized. It differs significantly between different nations and within nations themselves among different households…
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International Trade and Poverty Reduction in Africa-An Evaluation
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International Trade and Poverty Reduction in Africa-An Evaluation

Download file to see previous pages... Ng and Yeats (1996) showed that Sub Saharan Africa showed very poor performance in terms of global exports and the share of exports in world trade had been falling here since the 1950s. The authors argue the protectionist policies of the government here leading to the marginalization of the region from world trade and hence it remained non-competitive. The empirical analysis by the authors showed that the trade preferences of OECD provided a competitive advantage for Africa while the internal protectionist policies significantly contributed to the decline of the export performance here. The study hence demands the need for more liberalized trade policies in this region which are needed to reduce poverty in Sub Saharan Africa. Anderson et al showed that trade liberalization can result in poverty reduction in Sub Saharan Africa through increasing farm employment and output, the real value of agricultural and food exports, the real returns to farm land and unskilled labor, and real net farm incomes. It also results in increased income growth, which is greater than for other developing nations and developed nations as shown by the authors in spite of some terms of trade losses. Hence, the authors demanded the need for more trade openness in the region as a policy measure to reduce poverty. Similarly, Tuppy argued that in Sub Saharan Africa trade liberalization can produce welfare gains while this, in turn, will lead to reduced poverty only if there are drastic changes in the economic and political circumstances. ...Download file to see next pagesRead More
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