The Institute for Security Studies (ISS) published on 12 March 2018 an analysis titled "Port Deal Underscores Djibouti's Reliance on Ethiopia" by Simon Allison, ISS consultant.
The author notes that Djibouti's economy is dependent on Ethiopia. Any disruption to Ethiopia's economy as a result of current political unrest will have a knock-on effect in Djibouti. The same argument applies to Somaliland's port of Berbera, where Ethiopia is expanding its connections.
Showing posts with label political instability. Show all posts
Showing posts with label political instability. Show all posts
Thursday, March 15, 2018
Friday, November 24, 2017
Will Africa Become the Next Manufacturing Destination?
The Washington-based Center for Global Development (CDG) published in October 2017 a working paper titled "Can Africa Be a Manufacturing Destination? Labor Costs in Comparative Perspective" by Alan Gelb, Christian J. Meyer, Vijaya Ramachandran, and Divyanshi Wadhwa.
The study concluded that compared with Bangladesh for any given level of GDP, labor is more costly for firms that are located in Sub-Saharan Africa. The results did not suggest a particularly bright future for labor-intensive manufacturing in Africa. This is an important conclusion as many African leaders are pushing hard to industrialize and are being supported by China in this effort.
On a labor cost basis, a few African countries may be potential candidates for manufacturing. Ethiopia stood out in this study. The Democratic Republic of the Congo and Malawi were also possible candidates. Ethiopia's labor cost is reasonable compared to other African countries as well as to Bangladesh, and appears similar to China in the 1980s. Nevertheless, certain factors could derail industrialization in Ethiopia. Political unrest could unsettle investment in the manufacturing sector if repeated in Ethiopia on the scale seen in 2015 and 2016.
Drawing on the CDG study, The Nation published on 27 October an analysis titled "Kenya Can't Imitate China's Economic Model, As Things Stand" by Kwame Owino, chief executive officer of the Nairobi-based think tank, Institute of Economic Affairs. Owino concludes that Kenya's struggle to expand manufacturing shows the difficulty lies in getting into regional and global value chains.
The study concluded that compared with Bangladesh for any given level of GDP, labor is more costly for firms that are located in Sub-Saharan Africa. The results did not suggest a particularly bright future for labor-intensive manufacturing in Africa. This is an important conclusion as many African leaders are pushing hard to industrialize and are being supported by China in this effort.
On a labor cost basis, a few African countries may be potential candidates for manufacturing. Ethiopia stood out in this study. The Democratic Republic of the Congo and Malawi were also possible candidates. Ethiopia's labor cost is reasonable compared to other African countries as well as to Bangladesh, and appears similar to China in the 1980s. Nevertheless, certain factors could derail industrialization in Ethiopia. Political unrest could unsettle investment in the manufacturing sector if repeated in Ethiopia on the scale seen in 2015 and 2016.
Drawing on the CDG study, The Nation published on 27 October an analysis titled "Kenya Can't Imitate China's Economic Model, As Things Stand" by Kwame Owino, chief executive officer of the Nairobi-based think tank, Institute of Economic Affairs. Owino concludes that Kenya's struggle to expand manufacturing shows the difficulty lies in getting into regional and global value chains.
Wednesday, March 15, 2017
China and US Cooperation in Africa
Foreign Affairs published on 3 March 2017 a commentary titled "Where Beijing, Washington, and African Governments Can Work Together from Competition to Cooperation" by Mohamed Ibn Chambas, special representative of the UN Secretary General for West Africa and the Sahel, Princeton N. Lyman, special advisor to the president of USIP, Jianhua Zhong, former Chinese special representative for Africa, and John Goodman, Carter Center.
The commentary focuses on security issues in Africa where the United States and China can cooperate most effectively to the benefit of Africa. You can access the entire article by registering.
The commentary focuses on security issues in Africa where the United States and China can cooperate most effectively to the benefit of Africa. You can access the entire article by registering.
Thursday, March 5, 2015
Political Instability in Zimbabwe
The Council on Foreign Relations published in March 2015 an analysis titled "Political Instability in Zimbabwe" by George F. Ward, Institute for Defense Analyses.
The author notes that Zimbabwe's 91-year old president, Robert Mugabe, has no clear succession plan, and considerable uncertainty exists whether a stable succession will take place. Zimbabwe's economy remains weak and vulnerable to potential shocks that might precipitate political instability as well. The author urges the US to position itself to take advantage of any changing situation by working with others, especially South Africa and countries in southern Africa, to limit the risk of civil violence and lay the groundwork for a better future.
The author notes that Zimbabwe's 91-year old president, Robert Mugabe, has no clear succession plan, and considerable uncertainty exists whether a stable succession will take place. Zimbabwe's economy remains weak and vulnerable to potential shocks that might precipitate political instability as well. The author urges the US to position itself to take advantage of any changing situation by working with others, especially South Africa and countries in southern Africa, to limit the risk of civil violence and lay the groundwork for a better future.
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