GTAP Resources: Resource Display
GTAP Resource #7199 |
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"Trade integration beyond the AfCFTA: options and outcomes " by Antimiani, Alessandro, Lars Nilsson and Kevin Svensson Abstract Geopolitical tensions have negatively impacted global trade, but efforts to enhance trade and integration persist. The African Continental Free Trade Agreement (AfCFTA) is one such initiative, covering 1.4 billion people and a combined GDP of around US$ 3,000 billion. AfCFTA aims to increase intra-African trade, currently at 15% of total African trade, which is lower than other regional trading blocs. Studies on the potential economic impact of the AfCFTA suggest limited gains from tariff liberalization alone, but more significant benefits when non-tariff barriers (NTBs) and trade facilitation measures are incorporated. AfCFTA members are also involved in various extra-African free trade initiatives. The agreement's language points to the parties' ambition to reduce NTBs in goods and services, but no concrete measures are specified. Comparisons to the EU's customs union and Single Market highlight the significance of the free movement of people, capital, goods, and services. A computable general equilibrium (CGE) model, GTAP-RD, is used to assess the AfCFTA's impact. The model considers standard CGE features, including upward-sloping supply curves for non-capital economy-wide endowments (land and natural resources), relevant for developing countries. It also incorporates the decomposition of gross trade flows to reallocate value-added generated in producing goods and services back to the countries where that income is generated. Three scenarios are analyzed using the GTAP-RD model: (1) removing tariffs between regions and within regions, slightly overestimating the effects; (2) assessing the impact of converting AfCFTA into the African Continental Customs Union (AfCCU); and (3) assessing the impact of an EU-Africa FTA against African integration in the form of an FTA or a customs union. The study also evaluates the effects on other significant African external trading partners, such as China. |
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- GTAP Data Base and extensions - Multilateral trade negotiations - Africa (Central) - Africa (East) - Africa (North) - Africa (Southern) - Africa (West) |
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Last Modified: 9/15/2023 1:05:45 PM