Hostname: page-component-cd9895bd7-fscjk Total loading time: 0 Render date: 2024-12-25T17:33:30.919Z Has data issue: false hasContentIssue false
  • English
  • Français

Markets and Trade in West Africa: Policy Issues for the Poorest Members of ECOWAS

Published online by Cambridge University Press:  23 May 2014

J. Mark Ellis  and
Philip Morgan
Get access Rights & Permissions [Opens in a new window]

Extract

The limited size of domestic markets, the availability of natural and technological resources in national units, and the desire to retain some form of protection against full global competition are all factors which promote the formation of regional economic groupings. National markets are usually too small to support efficient industries, exploiting economies of scale or specialization. The elimination of tariffs within an economic community and a common external tariff to non-members should divert trade from external to internal community sources. For industries favorably affected by trade diversion, trade expansion should enable the exploitation of economies of scale and specialization formerly unattainable because of the small size of the domestic market. Production should be allocated among members on the basis of comparative advantage and, following free trade theory, it should then be at its most efficient and low cost. Economic integration is essentially then a strategy of export promotion and free trade among members and of import substitution and protection towards nonmembers (Balassa, 1973; Berendsen, 1978).

As Balassa and Stoutjesdijk (1975) have noted, trade diversion and regional protection may have harmful effects. Goods imported from regional partners may be inferior or higher in price. Less competitive conditions may slow the adoption of new technologies. One of the problems of any economic community is, therefore, to minimize these disadvantages. Relevant policies include both the promotion of efficient and competitive intra-regional exchange by setting external tariffs at sufficiently low levels and, also, the maximum exploitation of member state comparative advantage.

Type
Articles
Information
African Studies Review , Volume 27 , Issue 3 , September 1984 , pp. 67 - 76
Copyright
Copyright © African Studies Association 1984

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Amin, S. 1973. Neo-Colonialism in West Africa. New York: Monthly Review Press.Google Scholar
Balassa, B. 1965. “Trade Liberalization and Revealed Comparative Advantage,” Manchester School of Economic and Social Studies 33/2: 99–123.Google Scholar
Balassa, B. 1973. “Regional Integration of Trade: Policies of Less Developed Countries,” in Streeten, P. (ed.) Trade Strategies for Development. New York: Macmillan.Google Scholar
Balassa, B. and Stoutjesdijk, A. 1975. “Economic Integration among Developing Countries,” Journal of Common Market Studies 14/1: 37–55.Google Scholar
Berendsen, B. S. M. 1978. Regional Models of Trade and Development. Boston: Martinus Nijhoff Social Sciences Division.CrossRefGoogle Scholar
Fage, J. D. 1976. A History of West Africa. London: Longman.Google Scholar
Fieldhouse, D. K. 1973. Economics and Empire, 1830-1914. London: Weidenfeld and Nicholson.Google Scholar
Hanushek, E. A., and Jackson, J. E. 1977. Statistical Methods for Social Scientists. New York: Academic Press.Google Scholar
Mugomba, A. T. 1978. “Regional Organizations and African Underdevelopment: The Collapse of the East African Community,” Journal of Modern African Studies 16/1: 261–72.Google Scholar
Penahenera, G. S. 1978. “Viable Integration and the Economic Cooperation Problems of the Developing World,” United Nations Document E.AC.54/L.96.Google Scholar
Renninger, J. P. 1982. “The Future of Economic Cooperation Schemes in Africa, with Special Reference to ECOWAS,” in Shaw, T. (ed.) Alternative Futures for Africa. Boulder: Westview Press.Google Scholar
West Africa. 1981. “Economic Community of West Africa,” West Africa, May 25, p. 1153, 1981.Google Scholar
West Africa. 1982. “ECOWAS Milestone,” West Africa May 24, p. 1363, 1981.Google Scholar