Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business...

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4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04 Prof. Dr. Wolfgang Veit "Partnership for a sustainable development" The case of export promotion First regional and interdisciplinary Alumni Conference in Dar Es Salaam, Tanzania November 11-14, 2007

Transcript of Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business...

Page 1: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

"Partnership for a sustainabledevelopment"

The case of export promotion

First regional and interdisciplinaryAlumni Conference in Dar Es Salaam, Tanzania

November 11-14, 2007

Page 2: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

The concept of sustainability:macro definitions

Sustainability has three macro components: • EcologicalEcological : present production and consumption must not reduce

development potential of future

• EconomicEconomic: development should lead to a constant (sustainable) growth path

• SocialSocial: “just” distribution of wealth

Page 3: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

The concept of sustainability: micro/meso definitions

On a micro or meso level, sustainability is given when a

development programme or project in the long run a)      Is effectiveeffective, i.e. it reaches its goals

b)      Is significantsignificant, i.e. makes a contribution to the overall target (e.g. exports help develop a region)

c)      Is efficientefficient, i.e. reaches its goals in an economical way

d)      Does not have unacceptable side effectsside effects, i.e. culturally, environmentally, and socio-economically

Page 4: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

The concept of sustainability: firm strategy oriented definitions

InnovationInnovation

CompetitivenessCompetitivenessMarket presenceMarket presence

Sustainability on a firm level means long run market presence

This fimr sustainability contributes to macro sustainability, too

Page 5: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Sustainability as a process of continued (SME) business creation

• Creation of SMEs = entrepreneurshipentrepreneurship = innovation• Market orientationMarket orientation of SMEs makes innovation independent of

budget decisions feeds new information into SMEs• SMEs benefit from business networksbusiness networks in order to reduce cost

of non-core competency activities (e.g. business services)• ExportsExports support „life expectancy“ of SMEs • Exports require up-to-date market informationmarket information• Market information via business networksMarket information via business networks is preferred by

most SMEs

Page 6: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Sustainability through and of business networks

Networks with particular relevance for SMEs offer services like: • Mutual credit guaranteecredit guarantee• Peer groupPeer group lending/borrowing arrangements• Schemes to link SME-entrepreneurs with larger firmslarger firms• Joint marketingmarketing initiatives

Networks are the more successful, the • BroaderBroader the campaigns to introduce them to businesses• Quicker start up financefinance is provided to them• More realistic the time frametime frame (4 years!)• more experienced network brokersbrokers are

Page 7: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Employing networks for sustainable export performance: lessons learned from

IndonesiaTraditional trade Promotion: • DirectDirect Exports • Initial contact with customer at trade fairs trade fairs • Major problem: financefinance

Network based trade promotion• Trading houses Trading houses are prevailing form of network• BroaderBroader menu of services• SMEs do better Quicker start up financefinance is provided to them

Page 8: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Employing networks for sustainable export performance: the case of Indonesia (2)

How to support networks: provide enabling environmenta) Offer Trade informationb) Provide participation in trade fairsc) Offer bundled services d) Build competence for strategy consultinge) Active assistance in network buildingf) Investment promotion alongside trade promotiong) nationwide network building (PPP?)

Page 9: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

A special case of network: GVC

A dynamic definition: Sustainability = Innovation

a) GVC perspective of innovation

b) Exports initiate innovation

c) GVCs are vehicle for exports

InnovationInnovation

Global Value Global Value ChainsChains

ExportsExports

Page 10: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Innovation takes the form of upgrading within GVCs

Four types of upgrading:

1.1. ProcessProcess upgrading

2.2. ProductProduct upgrading

3.3. FunctionalFunctional upgrading

4.4. IntersectoralIntersectoral upgrading

Page 11: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Supporting industries and institutions

Factor conditions: Physical and human

resources

Demand conditions: Domestic customers

Structure of firms and rivalry: Leading businesses

International customers International customers

African African ExporterExporter

Porters single diamond model and GVCs

Page 12: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Governance structure of GVCs

• No limitNo limit on functional activities• Distribution of value added determined by powerpower

• 2 types of governance of GVC 1. „Arms lengthArms length“

2. Non-marketNon-market

- Network

- Quasi hierarchy

- Hierarchy

Page 13: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Governance structure of GVCs

• LatestLatest development: buyer driven value chains exert power through organization and information flow

• Opportunity for African producers:• Processing

• Product differentiation

• Investment in local systems

• Special customer relation management

Page 14: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Governance structure of GVCs: which is best for African exporters?

• Semi hierarchies: Semi hierarchies: pro product/process upgrading- traditional manufacturing and textiles benefit more

• Networks: Networks: universal, but hard to achieve

• Horizontal:Horizontal: frequently in supplier-driven GVCs

Page 15: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Innovation drivers

Source: UNCTAD, 2007

Page 16: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

16Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Retailers / Buyers Lead Firms

First-tier firms

Second-tier firms

Contractors / Distributors

Subcontractors / producers

= Information transfer = Product flows

Third-tier firmsSubcontractors / resource extractors

Hierarchy and functional distribution in GVCs

Page 17: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

17Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Retailers / Buyers Lead Firms

First-tier firms

Second-tier firms

Contractors / Distributors

Subcontractors / producers

= Responsibility transfer = Product flows

Third-tier firmsSubcontractors / resource extractors

Hierarchy and responsibility transfer

Page 18: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Rewards for upgradingselected sectors, Sub Saharan Africa

Source: UNCTAD, 2007

Page 19: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Cases of successful upgrading Kenya / UK (late 1990s)

Source: UNCTAD, 2007

Export of Fresh vegetables from Kenya to UK supermarkets was secured by …

Formation of producer alliance within KenyaBroadening of production base by investment in

TanzaniaImproving quality controlDiversification into cut flowers

Page 20: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Cases of successful upgrading Zimbabwe / World (early 1990s)

Source: UNCTAD, 2007

Position as first tier exporter of cotton was expanded by …

Vertical integration into spinning of yarnWidening producer base by acquisition of cotton concessions in MozambiqueBoth leading to economies of scale in production of cotton

and yarn

Page 21: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Cases of successful upgrading Coffee worldwide

Source: UNCTAD, 2007

General trend of downgrading of local suppliers could be resisted by …

Starting specialty coffee productionCatering to niche markets like Fair Trade and Organic Food sectorsSmallholder alliances direct sales at local auctions to avoid

local wholesalersIn few cases: Local Processing (wet processing plants)

Page 22: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Cases of successful upgrading Mauritius / Clothing

Source: UNCTAD, 2007

Product (diversification) and process upgrading was achieved by …

Investing in Madagascar, and thus Achieving economies of scale

Page 23: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Conclusions from previous cases of LDC-initiated attempts at staying in GVCs

Source: UNCTAD, 2007

LDC firms can stay integrated into GVCs by …

Achieving economies of scale through FDI in neighbouring countries, linking them with GVC

Moving to higher tier through targeting new/upcoming (niche) marketsFinding the right buyerOffering quality assuranceShifting to premium product (organic, environmentally friendly etc.)

Page 24: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Risks involved in these strategies

Source: UNCTAD, 2007

Benefits do not come without risks

•Higher dependency on buyers•Higher volatility of orders•Higher vulnerability to changing trends and competitive situation•Increased fragility of local production structures

Solution: trading down?

Page 25: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Case study: exporting „sustainable“ products

Source: UNCTAD, 2007

•Recent trend in IC markets: environmentally friendly products and processes•Strategic option for African producers: occupy niche markets •Major tool: join forces to comply with IC customer requests •Methods:

•benchmarking like SA 8000 standard•SPIES

•Strategy option: implement own standards if market power permits

Page 26: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Case study: exporting „sustainable“ products

Checklist for potential exportersFirst, they should assess the current situation in which they operate and answer the following questions:

What are the priority environmental and social issues for the sector (e.g. hazards, labour, resources, pollution)?

What are the major barriers to resolving these problems (e.g. finance, technology, information, government policy, skills etc.)?

What are the examples of good practice that already exist in the sector?

Second, they should ask the following questions to help them design a suitable response strategy:

??How can the sector develop a strategic approach - and who needs to be involved?

How can the sector assess the costs and benefits of social and environmental improvements?

How can the sector achieve market recognition for its performance?

How can the sector identify new market niches and business partners?

Page 27: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Conclusions

• Sustainability is a multifacetted concept• With regard to export promotion it has two dimensions:

organizational and economic sustainability• Business survive on economic sustainability• Sustainability in the business sector is synonymous with

permanent competitiveness• Competitveness can best be reached by ongoing innovation• Exports can be important innovation drivers if „trading up“

happens • Networks play a major role in export promotion, both as peer

group and as vertical GVC• Upgrading in GVC should be the target of African exporters in

order to stay sustainable

Page 28: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Unused export potential of Southern African countries

Current exports and export potential of Zambia to its main markets (USD million unless specified)

Exporter Rank Importer Rank Sector

Current Exports 2002-2003

share in ZMB 's

exports of sector, in

%

Relative Trade Potential

Total FDI outward

stock 2003

Zambia 6 Japan 12 Food, beverages and tobacco 0 0,0% 5. High untapped trade potential .

Zambia 8 China 2 Agriculture and hunting 1.315 1,7% 5. High untapped trade potential .

Zambia 9 Malawi 8 Metal and metal products 290 0,1% 5. High untapped trade potential .

Zambia 10 India TOTAL 16.789 2,1% 5. High untapped trade potential .

Zambia 10 India 3 Metal and metal products 849 0,1% 5. High untapped trade potential .

Zambia 11 Zimbabwe TOTAL 15.434 1,9% 5. High untapped trade potential .

Zambia 11 Zimbabwe 1 Metal and metal products 5.446 1,0% 5. High untapped trade potential .

Zambia 12 Netherlands 2 Metal and metal products 3.488 0,6% 5. High untapped trade potential .

Zambia 15 Germany TOTAL 9.607 1,2% 5. High untapped trade potential .

Zambia 15 Germany 3 Metal and metal products 336 0,1% 5. High untapped trade potential .

Zambia 18 United States TOTAL 6.873 0,9% 5. High untapped trade potential .

Zambia 18 United States 1 Metal and metal products 4.384 0,8% 5. High untapped trade potential .

Zambia 18 United States 2 Agriculture and hunting 835 1,1% 5. High untapped trade potential .

Zambia 18 United States 4 Textiles, clothing and leather 252 0,8% 5. High untapped trade potential .

Zambia 18 United States 5 Machinery and equipment 231 1,1% 5. High untapped trade potential .

Zambia 18 United States 8 Other manufacturing 139 1,8% 5. High untapped trade potential .

Zambia 18 United States 9 Electrical and electronic equipment 38 0,5% 5. High untapped trade potential .

Zambia 18 United States 11 Food, beverages and tobacco 22 0,1% 5. High untapped trade potential .

Zambia 20 France TOTAL 4.887 0,6% 5. High untapped trade potential .

Zambia 20 France 3 Metal and metal products 648 0,1% 5. High untapped trade potential .

Zambia 20 France 4 Agriculture and hunting 514 0,7% 5. High untapped trade potential .

Zambia 22 Kenya TOTAL 4.467 0,6% 5. High untapped trade potential .

Zambia 22 Kenya 1 Metal and metal products 3.748 0,7% 5. High untapped trade potential .

Zambia 24Hong Kong, China

TOTAL 3.861 0,5% 5. High untapped trade potential .

Zambia 24Hong Kong, China

3 Metal and metal products 438 0,1% 5. High untapped trade potential .

Zambia 25 Italy TOTAL 3.455 0,4% 5. High untapped trade potential .

Zambia 25 Italy 2 Metal and metal products 1.244 0,2% 5. High untapped trade potential .

Zambia 25 Italy 3 Agriculture and hunting 95 0,1% 5. High untapped trade potential .

Zambia 25 Italy 5 Food, beverages and tobacco 44 0,1% 5. High untapped trade potential .

Zambia 29Russian Federation

TOTAL 1.338 0,2% 5. High untapped trade potential .

Sopurce: ITC

Page 29: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Unused export potential of Southern African countries

Current exports and export potential of South Africa to its main markets (USD million unless specified)

Exporter Rank Importer Rank SectorCurrent Exports

2002-2003

share in ZAF 's

exports of sector, in

%

Relative Trade PotentialTotal FDI outward

stock 2003

Share in Total FDI Outstock,

in %

Tariff applied by importer,

in %

South Africa 1 United States TOTAL 3.547.392 11,8% 5. High untapped trade potential 2.249 11,5%

South Africa 1 United States 2 Motor vehicles and other transport equipment 576.453 17,4% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 3 Chemicals and chemical products 351.172 15,0% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 5 Textiles, clothing and leather 228.463 28,7% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 6 Machinery and equipment 210.137 10,2% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 7 Other manufacturing 175.451 15,9% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 8 Food, beverages and tobacco 109.322 5,6% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 9 Coke, petroleum products and nuclear fuel 62.988 8,3% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 10 Agriculture and hunting 59.526 4,0% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 11 Wood and wood products 55.280 4,7% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 12 Rubber and plastic products 37.470 8,7% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 13 Electrical and electronic equipment 34.614 4,0% 5. High untapped trade potential . . 0 to 5%

South Africa 1 United States 14 Non-metallic mineral products 23.460 8,9% 5. High untapped trade potential . . 0 to 5%

South Africa 6 Italy 7 Chemicals and chemical products 27.947 1,2% 5. High untapped trade potential . . 0 to 5%

South Africa 6 Italy 10 Motor vehicles and other transport equipment 13.748 0,4% 5. High untapped trade potential . . 0 to 5%

South Africa 11 China TOTAL 866.011 2,9% 5. High untapped trade potential 0 0,0%

South Africa 11 China 6 Machinery and equipment 21.130 1,0% 5. High untapped trade potential . . 5 to 10%

South Africa 11 China 10 Agriculture and hunting 8.447 0,6% 5. High untapped trade potential . . 5 to 10%

South Africa 12 Spain 2 Metal and metal products 91.715 1,2% 5. High untapped trade potential . . 0 to 5%

South Africa 13 France 3 Metal and metal products 108.011 1,4% 5. High untapped trade potential . . 0 to 5%

South Africa 15 Australia 2 Metal and metal products 74.261 1,0% 5. High untapped trade potential . . 5 to 10%

South Africa 20Hong Kong, China

TOTAL 418.470 1,4% 5. High untapped trade potential 377 1,9%

South Africa 20Hong Kong, China

1 Metal and metal products 124.083 1,6% 5. High untapped trade potential . . 0 to 5%

South Africa 26 Canada TOTAL 241.293 0,8% 5. High untapped trade potential 9 0,0%

South Africa 26 Canada 1 Metal and metal products 74.540 1,0% 5. High untapped trade potential . . 0 to 5%

South Africa 26 Canada 7 Motor vehicles and other transport equipment 10.836 0,3% 5. High untapped trade potential . . 0 to 5%

South Africa 28 Thailand TOTAL 226.828 0,8% 5. High untapped trade potential . .

South Africa 29 Singapore TOTAL 207.796 0,7% 5. High untapped trade potential 29 0,1%

South Africa 29 Singapore 4 Metal and metal products 27.527 0,4% 5. High untapped trade potential . . 0 to 5%

South Africa 30 Malaysia TOTAL 199.213 0,7% 5. High untapped trade potential 0 0,0%

South Africa 30 Malaysia 1 Metal and metal products 64.962 0,9% 5. High untapped trade potential . . 5 to 10%

South Africa 30 Malaysia 7 Motor vehicles and other transport equipment 9.276 0,3% 5. High untapped trade potential . . 25 to 30%

Sopurce: ITC

Page 30: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Unused export potential of Southern African countries

Sopurce: ITC

Current exports and export potential of United Republic of Tanzania to its main markets (USD million unless specified)

Exporter Rank Importer Rank SectorCurrent Exports

2002-2003

share in TZA 's

exports of sector, in

%

Relative Trade PotentialTotal FDI outward

stock 2003

Share in Total FDI Outstock,

in %

Tariff applied by importer,

in %

UR Tanzania 2 Japan 3 Food, beverages and tobacco 5.433 3,4% 5. High untapped trade potential . . 5 to 10%

UR Tanzania 2 Japan 8 Forestry and Fishing (products) 81 0,7% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 3 France 3 Agriculture and hunting 3.053 1,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 4 India 7 Metal and metal products 543 0,2% 5. High untapped trade potential . . 30 to 35%

UR Tanzania 4 India 9 Food, beverages and tobacco 197 0,1% 5. High untapped trade potential . . 35 to 40%

UR Tanzania 6 Kenya 11 Metal and metal products 352 0,1% 5. High untapped trade potential . . 20 to 25%

UR Tanzania 7 Belgium 10 Metal and metal products 27 0,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 8 Germany 2 Food, beverages and tobacco 3.962 2,5% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 8 Germany 5 Metal and metal products 323 0,1% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 11 Italy TOTAL 20.395 2,2% 5. High untapped trade potential . .

UR Tanzania 11 Italy 2 Agriculture and hunting 3.605 1,2% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 11 Italy 12 Metal and metal products 24 0,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 13 United States TOTAL 16.409 1,8% 5. High untapped trade potential . .

UR Tanzania 13 United States 1 Agriculture and hunting 5.134 1,7% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 13 United States 2 Food, beverages and tobacco 3.203 2,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 13 United States 3 Other manufacturing 2.951 12,3% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 13 United States 6 Textiles, clothing and leather 1.252 5,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 13 United States 9 Motor vehicles and other transport equipment 49 0,7% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 13 United States 10 Metal and metal products 14 0,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 15Hong Kong, China

TOTAL 12.419 1,3% 5. High untapped trade potential . .

UR Tanzania 15Hong Kong, China

2 Agriculture and hunting 1.173 0,4% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 15Hong Kong, China

6 Metal and metal products 89 0,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 16 Spain TOTAL 11.845 1,3% 5. High untapped trade potential . .

UR Tanzania 16 Spain 2 Agriculture and hunting 4.808 1,6% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 18 Saudi Arabia TOTAL 9.378 1,0% 5. High untapped trade potential . .

UR Tanzania 18 Saudi Arabia 2 Agriculture and hunting 2.090 0,7% 5. High untapped trade potential . . 5 to 10%

UR Tanzania 18 Saudi Arabia 5 Food, beverages and tobacco 280 0,2% 5. High untapped trade potential . . > 50%

UR Tanzania 19 Singapore 5 Metal and metal products 29 0,0% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 23 China TOTAL 7.277 0,8% 5. High untapped trade potential . .

UR Tanzania 23 China 2 Agriculture and hunting 2.363 0,8% 5. High untapped trade potential . . 5 to 10%

UR Tanzania 23 China 3 Food, beverages and tobacco 589 0,4% 5. High untapped trade potential . . 20 to 25%

UR Tanzania 23 China 13 Metal and metal products 8 0,0% 5. High untapped trade potential . . 5 to 10%

UR Tanzania 24 Indonesia 5 Metal and metal products 23 0,0% 5. High untapped trade potential . . 5 to 10%

UR Tanzania 25 Thailand TOTAL 6.319 0,7% 5. High untapped trade potential . .

UR Tanzania 25 Thailand 4 Metal and metal products 458 0,2% 5. High untapped trade potential . . 15 to 20%

UR Tanzania 27 Greece 3 Agriculture and hunting 261 0,1% 5. High untapped trade potential . . 0 to 5%

UR Tanzania 30Russian Federation

TOTAL 3.657 0,4% 5. High untapped trade potential . .

UR Tanzania 30Russian Federation

2 Food, beverages and tobacco 353 0,2% 5. High untapped trade potential . . 25 to 30%

Page 31: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Unused export potential of Southern African countries

Sopurce: ITC

Current exports and export potential of Namibia to its main markets (USD million unless specified)

Exporter Rank Importer Rank SectorCurrent Exports

2002-2003

share in NAM 's

exports of sector, in

%

Relative Trade PotentialTotal FDI outward

stock 2003

Share in Total FDI Outstock,

in %

Tariff applied by importer,

in %

Namibia 3 United Kingdom TOTAL 223.616 16,4% 5. High untapped trade potential . .

Namibia 3 United Kingdom 2 Food, beverages and tobacco 15.242 3,1% 5. High untapped trade potential . . 0 to 5%

Namibia 3 United Kingdom 12 Metal and metal products 38 0,0% 5. High untapped trade potential . . 0 to 5%

Namibia 3 United Kingdom 15 Publishing, printing and reproduction of recorded media 7 0,0% 5. High untapped trade potential . . 0 to 5%

Namibia 5 France 3 Food, beverages and tobacco 9.134 1,9% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States TOTAL 55.469 4,1% 5. High untapped trade potential . .

Namibia 6 United States 4 Coke, petroleum products and nuclear fuel 8.180 9,9% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States 5 Food, beverages and tobacco 7.808 1,6% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States 7 Other manufacturing 312 1,5% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States 8 Motor vehicles and other transport equipment 276 0,7% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States 10 Agriculture and hunting 99 0,2% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States 12 Electrical and electronic equipment 39 0,1% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States 13 Machinery and equipment 34 0,1% 5. High untapped trade potential . . 0 to 5%

Namibia 6 United States 15 Rubber and plastic products 20 0,1% 5. High untapped trade potential . . 0 to 5%

Namibia 7 Italy TOTAL 26.252 1,9% 5. High untapped trade potential . .

Namibia 7 Italy 1 Food, beverages and tobacco 15.906 3,3% 5. High untapped trade potential . . 0 to 5%

Namibia 7 Italy 5 Agriculture and hunting 301 0,5% 5. High untapped trade potential . . 0 to 5%

Namibia 9 Germany TOTAL 21.123 1,6% 5. High untapped trade potential . .

Namibia 9 Germany 1 Food, beverages and tobacco 7.832 1,6% 5. High untapped trade potential . . 0 to 5%

Namibia 9 Germany 5 Metal and metal products 957 1,1% 5. High untapped trade potential . . 0 to 5%

Namibia 9 Germany 11 Publishing, printing and reproduction of recorded media 181 0,2% 5. High untapped trade potential . . 0 to 5%

Namibia 10 Canada 7 Food, beverages and tobacco 48 0,0% 5. High untapped trade potential . . 15 to 20%

Namibia 12 Japan TOTAL 14.454 1,1% 5. High untapped trade potential . .

Namibia 12 Japan 1 Food, beverages and tobacco 14.120 2,9% 5. High untapped trade potential . . 5 to 10%

Namibia 12 Japan 3 Forestry and Fishing (products) 63 0,3% 5. High untapped trade potential . . 0 to 5%

Namibia 12 Japan 6 Coke, petroleum products and nuclear fuel 9 0,0% 5. High untapped trade potential . . > 50%

Namibia 12 Japan 13 Agriculture and hunting 0 0,0% 5. High untapped trade potential . . 0 to 5%

Namibia 13 China TOTAL 14.322 1,1% 5. High untapped trade potential . .

Namibia 13 China 2 Food, beverages and tobacco 4.479 0,9% 5. High untapped trade potential . . 20 to 25%

Namibia 13 China 4 Agriculture and hunting 427 0,7% 5. High untapped trade potential . . 5 to 10%

Namibia 18Russian Federation

TOTAL 5.344 0,4% 5. High untapped trade potential . .

Namibia 18Russian Federation

1 Food, beverages and tobacco 3.198 0,7% 5. High untapped trade potential . . 25 to 30%

Namibia 19 Australia TOTAL 5.088 0,4% 5. High untapped trade potential . .

Namibia 19 Australia 14 Publishing, printing and reproduction of recorded media 0 0,0% 5. High untapped trade potential . . 0 to 5%

Namibia 20 Belgium TOTAL 4.983 0,4% 5. High untapped trade potential . .

Namibia 20 Belgium 2 Food, beverages and tobacco 2.163 0,4% 5. High untapped trade potential . . 0 to 5%

Namibia 21 Switzerland TOTAL 4.014 0,3% 5. High untapped trade potential . .

Namibia 22 Portugal TOTAL 3.310 0,2% 5. High untapped trade potential . .

Namibia 24 Nigeria TOTAL 2.451 0,2% 5. High untapped trade potential . .

Namibia 24 Nigeria 1 Food, beverages and tobacco 1.869 0,4% 5. High untapped trade potential . . > 50%

Namibia 25Republic of Korea

TOTAL 2.253 0,2% 5. High untapped trade potential . .

Namibia 25Republic of Korea

2 Food, beverages and tobacco 344 0,1% 5. High untapped trade potential . . 35 to 40%

Namibia 26Hong Kong, China

TOTAL 2.062 0,2% 5. High untapped trade potential . .

Namibia 26Hong Kong, China

1 Food, beverages and tobacco 1.923 0,4% 5. High untapped trade potential . . 0 to 5%

Namibia 28 India TOTAL 1.679 0,1% 5. High untapped trade potential . .

Namibia 28 India 6 Food, beverages and tobacco 14 0,0% 5. High untapped trade potential . . 35 to 40%

Namibia 29 Zambia TOTAL 1.679 0,1% 5. High untapped trade potential . .

Namibia 30 Saudi Arabia TOTAL 1.678 0,1% 5. High untapped trade potential . .

Namibia 30 Saudi Arabia 6 Food, beverages and tobacco 0 0,0% 5. High untapped trade potential . . > 50%

Page 32: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Unused export potential of Southern African countries

Sopurce: ITC

Current exports and export potential of Malawi to its main markets (USD million unless specified)

Exporter Rank Importer Rank SectorCurrent Exports

2002-2003

share in MWI 's

exports of sector, in

%

Relative Trade PotentialTotal FDI outward

stock 2003

Share in Total FDI Outstock,

in %

Tariff applied by importer,

in %

Malawi 3 Germany 2 Food, beverages and tobacco 260 0,4% 5. High untapped trade potential . . 0 to 5%

Malawi 3 Germany 10 Textiles, clothing and leather 7 0,0% 5. High untapped trade potential . . 0 to 5%

Malawi 4 United Kingdom 4 Textiles, clothing and leather 252 0,7% 5. High untapped trade potential . . 0 to 5%

Malawi 5 Japan 2 Food, beverages and tobacco 85 0,1% 5. High untapped trade potential . . 5 to 10%

Malawi 5 Japan 12 Textiles, clothing and leather 0 0,0% 5. High untapped trade potential . . 0 to 5%

Malawi 7 Egypt 2 Food, beverages and tobacco 562 0,8% 5. High untapped trade potential . . 0 to 5%

Malawi 9Russian Federation

2 Food, beverages and tobacco 106 0,2% 5. High untapped trade potential . . 25 to 30%

Malawi 12 France 2 Agriculture and hunting 3.519 1,1% 5. High untapped trade potential . . 0 to 5%

Malawi 13 Spain TOTAL 7.963 1,8% 5. High untapped trade potential . .

Malawi 13 Spain 1 Agriculture and hunting 5.328 1,7% 5. High untapped trade potential . . 0 to 5%

Malawi 18 Zimbabwe TOTAL 4.889 1,1% 5. High untapped trade potential . .

Malawi 18 Zimbabwe 1 Agriculture and hunting 2.711 0,9% 5. High untapped trade potential . . 0 to 5%

Malawi 18 Zimbabwe 2 Food, beverages and tobacco 676 1,0% 5. High untapped trade potential . . 0 to 5%

Malawi 18 Zimbabwe 5 Textiles, clothing and leather 122 0,3% 5. High untapped trade potential . . 0 to 5%

Malawi 21 Zambia 1 Agriculture and hunting 1.690 0,5% 5. High untapped trade potential . . 0 to 5%

Malawi 22 Italy TOTAL 4.425 1,0% 5. High untapped trade potential . .

Malawi 22 Italy 1 Agriculture and hunting 3.600 1,1% 5. High untapped trade potential . . 0 to 5%

Malawi 22 Italy 2 Food, beverages and tobacco 619 0,9% 5. High untapped trade potential . . 0 to 5%

Malawi 22 Italy 4 Textiles, clothing and leather 39 0,1% 5. High untapped trade potential . . 0 to 5%

Malawi 23 Australia 2 Food, beverages and tobacco 15 0,0% 5. High untapped trade potential . . > 50%

Page 33: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Unused export potential of Southern African countries

Sopurce: ITC

Current exports and export potential of Botswana to its main markets (USD million unless specified)

Note: trade with SACU countries, such as South-Africa or Namibia might not be fully captured. Hence, indicators should be interpreted with care

Exporter Rank Importer Rank SectorCurrent Exports

2002-2003

share in BWA 's

exports of sector, in

%

Relative Trade PotentialTotal FDI outward

stock 2003

Share in Total FDI Outstock,

in %

Tariff applied by importer,

in %

Botswana 3 Thailand TOTAL 77.491 4,0% 5. High untapped trade potential . .

Botswana 5 United States TOTAL 21.890 1,1% 5. High untapped trade potential . .

Botswana 5 United States 4 Metal and metal products 57 0,0% 5. High untapped trade potential . . 0 to 5%

Botswana 5 United States 11 Food, beverages and tobacco 0 0,0% 5. High untapped trade potential . . 0 to 5%

Botswana 5 United States 12 Electrical and electronic equipment 0 0,0% 5. High untapped trade potential . . 0 to 5%

Botswana 7 Japan TOTAL 10.240 0,5% 5. High untapped trade potential . .

Botswana 8 Germany TOTAL 7.471 0,4% 5. High untapped trade potential . .

Botswana 10 Italy TOTAL 4.111 0,2% 5. High untapped trade potential . .

Botswana 15 France TOTAL 2.529 0,1% 5. High untapped trade potential . .

Botswana 16 South Africa TOTAL 2.030 0,1% 5. High untapped trade potential . .

Botswana 16 South Africa 5 Food, beverages and tobacco 4 0,0% 5. High untapped trade potential . . 0 to 5%

Botswana 18 China TOTAL 1.086 0,1% 5. High untapped trade potential . .

Botswana 19 Spain TOTAL 855 0,0% 5. High untapped trade potential . .

Botswana 20Republic of Korea

TOTAL 449 0,0% 5. High untapped trade potential . .

Botswana 21 Netherlands TOTAL 430 0,0% 5. High untapped trade potential . .

Botswana 23 Poland TOTAL 355 0,0% 5. High untapped trade potential . .

Botswana 24 Pakistan TOTAL 324 0,0% 5. High untapped trade potential . .

Botswana 26 Saudi Arabia TOTAL 215 0,0% 5. High untapped trade potential . .

Botswana 27 Ireland TOTAL 142 0,0% 5. High untapped trade potential . .

Botswana 28 Czech Republic TOTAL 121 0,0% 5. High untapped trade potential . .

Botswana 29 Algeria TOTAL 114 0,0% 5. High untapped trade potential . .

Botswana 30 Austria TOTAL 107 0,0% 5. High untapped trade potential . .

Page 34: Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04   Prof. Dr. Wolfgang Veit 4.04.

4.04 Business Development and Infrastructure: Trade Africa - Training in Export Promotion

Cologne University of Applied Sciences / Fachhochschule Köln Faculty of Economics and Business Administration/ Fak 04

Prof. Dr. Wolfgang Veit

Sources

• OECD (2004): Entrepreneurship and Local Economic Development: Programme and Policy Recommendations

• Hemmer, H.R. (2002): Wirtschaftsprobleme der Entwicklungsländer, 3. Auflage• UNCTAD (2007): The Least Developed Countries Report• Porter, M.E. (2004): Competitive Strategy, First Free Press Export Edition• Rugman,A./Collinson, S.(2006): International Business, 4th ed.• Sandee, H./ Ibrahim, B. (2002): Evaluation of SME Trade and Export Promotion

in Indonesia, ADB Background Report• UNESCAP (2001): Enhancing Export Opportunities Through Environmentally

Sound Business Development, Studies in Trade and Environment No. 44