Differentiated Impact of AGOA and EBA on West African Countries
The African Growth Opportunity Act (AGOA) and Everything But Arms (EBA), two preferential agreements extended by the United States (AGOA) and the European Union (EU) (EBA) to some developing countries seem to have contributed somewhat to boost Sub-...
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| Language: | English |
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World Bank, Washington, DC
2021
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| Online Access: | http://documents.worldbank.org/curated/en/765691623062098213/Differentiated-Impact-of-AGOA-and-EBA-on-West-African-Countries http://hdl.handle.net/10986/35742 |
| Summary: | The African Growth Opportunity Act
(AGOA) and Everything But Arms (EBA), two preferential
agreements extended by the United States (AGOA) and the
European Union (EU) (EBA) to some developing countries seem
to have contributed somewhat to boost Sub-Saharan Africa’s
exports since 2001. However, not all African countries have
benefited from them, among which West African countries.
Paradoxically, these latter countries host two of the most
advanced regional economic communities in Sub-Saharan
Africa: the West African Economic and Monetary Union (WAEMU)
sharing a common monetary policy that has consistently
maintained inflation low and forming a customs union with a
compensation mechanism to uphold the common external tariff;
and the economic community of West African States (ECOWAS)
maintaining a regional military force (ECOMOG) and peer
pressure that have rooted out military coups in its member
countries. Simulations derived from a Pseudo Poisson maximum
likelihood gravity model estimation show that West Africa
could be exporting 2.5 to 4 times more to the EU and the US
if AGOA and EBA were not implemented in a differentiated
manner, in terms of country eligibility, product coverage,
and rules of origins. Given such trade creation potential
for a group of countries committed to deep regional
integration, a revision of AGOA and EBA, or a special ECOWAS
and WAEMU provision will make these preferential trade
agreements a driving force behind the success of regional
integration in Sub-Saharan Africa. |
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