Fragile States, Commodity Booms and Export Performance
An Analysis of the Sub-Saharan African case
Background paper to the ERD2009
Paper prepared for the Workshop on “Food crisis and the development potential of the agricultural sector in fragile countries”, organised by the European Report of Development in Cambridge, United Kingdom, 17-18 March 2009.
Sub-Saharan Africa’s export performance over recent decades has typically been portrayed as poor compared to other regions in developing countries. This paper takes a new look at the record, using data on the volume rather than the value of African exports. When analysed in volume terms a different picture of African export performance emerges. Despite being confronted by sharply declining prices, between 1995-2001 African exports expanded by an average of 5.9 percent annually. The picture changes quite significantly during the post-2002 commodity price boom period, with increases of 5.2 per cent per annum in average volumes. By using a dynamic panel of 36 Sub-Saharan countries, the aim of this paper is to analyse this apparent paradox, using data available from UNCTAD. Specifically, we investigate the price-elasticity response of African exporters in the light of dramatically shifting unit prices. In the context of the EDR project, we also specifically look at the question of whether countries classified as ´fragile states´ have been especially disadvantaged in terms of their export performance.