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Trade and Poverty Alleviation in Africa: The Role of Inclusive Structural Transformation

Trade and Poverty Paper Series, No. 2

Economic transformation is increasingly believed to be the mechanism to make trade work for poverty reduction and development in Africa.

This paper argues that while transformation is indeed necessary for trade to contribute to poverty reduction, the nature of transformation also matters. In particular, strengthening the contribution of trade to poverty reduction in Africa requires inclusive structural transformation, which is transformation that enhances participation of vulnerable groups in the trade and development process.

And for this to happen, governments have to address economic, political and cultural issues that foster social exclusion, remove input market imperfections that prevent vulnerable groups from exploiting market opportunities, and adopt a more gradual approach to liberalization to ensure that the reforms do not have a disproportionate negative impact on the poor.

There is also the need to mainstream employment as well as rural development into the transformation agenda and ensure that workers get a fair share of the gains from productivity increases resulting from structural transformation.

Trade and Poverty Paper Series

The aim of the Trade and Poverty Paper Series is to disseminate the findings of research work on the inter-linkages between trade and poverty and to identify policy options at the national and international levels on the use of trade as a more effective tool for poverty eradication.

The opinions expressed in papers under the series are those of the authors and are not to be taken as the official views of the UNCTAD Secretariat or its member states. The designations and terminology employed are also those of the authors.

Trade and Poverty Alleviation in Africa: The Role of Inclusive Structural Transformation - by Patrick N. Osakwe and Miriam Poretti (UNCTAD)  (UNCTAD/WEB/ALDC/2015/2)
05 Nov 2015