The impact of Chinese competition on Africa’s manufacturing
Résumé
In this paper, the impact of Chinese competition on Africa’s manufacturing value added is
analyzed through a model of manufacturing. Using panel data on 44 African countries
covering the period 2000 to 2013, and controlling for the usual determinants of
industrialization – such as the size of the domestic market, the quality of infrastructure and
governance – we find that exports of manufactured goods by China and other countries to
African countries mainly exert a negative effect on African manufacturing, while a moderate
real appreciation of African currencies vis-à-vis the renminbi positively influences
manufacturing value added, probably due to the reduced cost of imported machine and
transport equipment from China (which accounted for 36% of total African imports from
China in 2013) and to the reduced price of imported consumption goods increasing the
remuneration of poor workers and therefore improving their productivity. However, a strong
real appreciation (of more than 33%) instead exerts a negative effect on African’s
manufacturing, as traditional theory predicts.
Domaines
Economies et financesOrigine | Fichiers produits par l'(les) auteur(s) |
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