nep-afr New Economics Papers
on Africa
Issue of 2018‒02‒26
six papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. South-South labour migration and the impact of the informal China-Ghana gold rush 2008–13 By Gabriel Botchwey; Gordon Crawford; Nicholas Loubere; Jixia Lu
  2. The Diaspora and Economic Development in Africa. By Blaise Gnimassoun; John C. Anyanwu
  3. Empirical Assessment of Trade Engagements: Africa, China and the Maritime Belt and Road Initiative By Emmanuel , Igbinoba
  4. Improving quality of life through sustainable energy and urban infrastructure in Africa By Mutanga, Shingirirai Savious; Quitzow, Rainer; Steckel, Jan Christoph
  5. Does Foreign Aid Reduce Poverty In Sub-Saharan Africa? A Dynamic Panel-Data Analysis By Mahembe, Edmore; Odhiambo, Nicholas M.
  6. Regional Integration: Do intra-African trade and migration improve income in Africa? By Blaise Gnimassoun

  1. By: Gabriel Botchwey; Gordon Crawford; Nicholas Loubere; Jixia Lu
    Abstract: This paper examines irregular South-South migration from China to Ghana, and the role it has played in transforming livelihoods and broader developmental landscapes. It looks at the entry from the mid-2000s of approximately 50,000 Chinese migrants into the small-scale gold mining sector. They were mainly from Shanglin County, an area of alluvial gold mining. In Ghana, they formed mutually beneficial relationships with local miners, both legal and illegal, introducing machinery that substantially intensified gold production. However, the legal status of Chinese miners was particularly problematic as, by law, small-scale mining is restricted to Ghanaian citizens. In mid-2013 President Mahama established a military task force, which resulted in the deportation of many Chinese miners. This paper examines the experiences of undocumented Chinese migrants and Ghanaian miners. Findings are that this short-lived phenomenon has had long-lasting effects and significant consequences for Ghanaian and Chinese actors, as well as transforming economic, political, and physical landscapes in Ghana.
    Date: 2018
  2. By: Blaise Gnimassoun; John C. Anyanwu
    Abstract: While the dominant collective belief asserts that brain drain is detrimental to the development of small economies, new studies hold the reverse view. This paper aims at studying the role of the African Diaspora in the economic development of Africa. It analyzes both the overall effect and the specific effect of emigration according to the level of education of emigrants. Then, through a deeper investigation, the paper analyzes the main channels through which the Diaspora influences economic development in Africa. The results show that the African Diaspora contributes positively, significantly and robustly to the improvement of real per capita income in Africa. These findings challenge the dominant collective belief since the higher the educational level of the emigrants, the greater the impact of the Diaspora on the level of economic development. Improvement in human capital, total factor productivity and democracy are effective transmission channels of this impact. Finally, the results show that while high-skilled emigrants have an overall greater impact on economic development and democracy, those with a low level of education contribute more to remittances to Africa. The establishment of an annual African Diaspora Summer School (ADSS) by the AfDB in partnership relevant international and regional stakeholders as a channel for the transfer of knowledge, technology and experience would further strengthen the role of the Diaspora in Africa’s economic development.
    Keywords: The African Diaspora, International migration, Economic development, Africa.
    JEL: F22 O55
    Date: 2018
  3. By: Emmanuel , Igbinoba (Diversity Watch Limited England)
    Abstract: Recent development economic literatures theorize that South-South trade and foreign investment may have a larger impact on economic growth in developing economies than North-South trade and investment, since investors from the South are more familiar with local developing markets and business practices, which increases their productivity spillovers (Aykut and Goldstein 2007). Amighini and Sanfilippo (2014) provided evidence that South-South trade and investments stimulate product diversification in light manufacturing industries such as agroprocessing, plastic, textile and leather production. The Belt and Road Initiative (BRI) launched in 2013, aims to create economic opportunities as well as improve and establish new trading routes between China and connected regions. This paper attempts to evaluate the degree of trade relations between China and selected African countries along the Maritime Silk Route (MSR) and further appraise the trade potentials and gains inherent for African economies through the initiative. To achieve our objective, we apply quantitative techniques in trade evaluation to enable us explore and estimate the degree and intensity of trade engagements amongst selected Sino-African silk route countries, identify the trade opportunities and potentials, which are critical for increased trade engagements between both parties along the route and to explore some of the channels through which the maritime route can impact on investment, trade and economic growth in Africa. Findings from the analysis indicate that while the degree of trade integration is unbalanced and favourable to China relative to Africa, the trade pattern and structure are observed to be more complementary than competitive, and this provides Africa with ample opportunity to engage in product upgrading and diversification, critical for structural transformation.
    Keywords: Maritime Silk Route; Belt and Road; Africa; Trade Complementarity; Trade Competitiveness
    JEL: F15 F17 F18 O24
    Date: 2017–12–19
  4. By: Mutanga, Shingirirai Savious; Quitzow, Rainer; Steckel, Jan Christoph
    Abstract: Focusing on critical aspects of infrastructure, such as energy, this paper argues that African countries, and African cities in particular, need infrastructure that advances both basic needs and industrialization, and avoids a lock-in of unsustainable, high-carbon technologies. G20 countries can promote and support quality of life in African countries by: (1) aligning and cementing the G20 Agenda for Africa with African initiatives, SDGs and the Paris Agreement, (2) mitigating economic risks of climate change through supporting low carbon development pathways in Africa, (3) creating and enabling a level playing field for low carbon technologies, which includes integrated strategies for derisking renewable energy investments, and (4) supporting smart and sustainable urban planning.
    Keywords: sustainable development,climate policy,Africa
    JEL: Q01 Q54 H23 R11
    Date: 2018
  5. By: Mahembe, Edmore; Odhiambo, Nicholas M.
    Abstract: The main objective of this study is to examine the effect of official development assistance (ODA) or foreign aid on poverty in Sub-Saharan Africa (SSA) region over the period 1981-2011. This study uses recent dynamic panel estimation techniques, including those methods which deal with endogeneity and simultaneity concerns. To test the robustness of the results, the study uses three different proxies for poverty and five proxies for foreign aid. The main finding of the study is that foreign aid does have statistically significant poverty reduction effect. The results are consistent across all the three poverty proxies. The disaggregating of aid by source and type could not offer conclusive results. On the other hand, the study found that income per capita have around three times higher poverty-reducing effect compared to foreign aid while inequality has a detrimental effect on the fight against poverty.
    Keywords: Official development assistance (ODA); foreign aid; poverty; economic growth; inequality; developing countries; dynamic panel data analysis; system GMM
    Date: 2018–02–16
  6. By: Blaise Gnimassoun
    Abstract: Regional integration in Africa is a subject of great interest, but its impact on income has not been studied sufficiently. Using cross-sectional and panel estimations, this paper examines the impact of African integration on real per capita income in Africa. To do this, we consider intra-African trade and migration flows as quantitative measures reflecting the intensity of regional integration. In order to address the endogeneity concerns, we use a gravity-based IV strategy. Our results show that, from a long-term perspective, African integration has not been strong enough to generate a positive, significant and robust impact on real per capita income in Africa. However it appears to be significantly income-enhancing in the short term but only through inter-country migration. These results are robust to a wide range of specifications. Further analysis shows that economic diversification, financial development and the quality of transport and telecommunication infrastructure significantly affect the impact of intra-African trade on per capita income. Their improvement would make intra-African trade income-improving. Our policy recommendations have been formulated in this direction.
    Keywords: Income per capita, Trade, International Migration, Economic Integration, Africa.
    JEL: E64 F14 F22 F15 O55
    Date: 2018

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