Releasing Export Constraints: The Role of Governments
"This paper discusses the economic rationale for government interventions to support export development and, in the light of this rationale,examines the interventions needed to address the key factors responsible for restraining export supply response across products and countries in Africa. Section II summarizes the debate among economists on industrial development policy and export promotion, including recent results of particular relevance to the discussion of export promotion and diversification policies. It explains that the case in favour of interventions hinges upon the existence of some market failure. Economists tend to agree on the fact that permissive and functional policies can promote development but their views diverge on the need for selective policies. The controversy regarding selective policies is for the most part rooted in implementation related issues. Section III provides an overview of recent contributions which explore the factors affecting the export performance of manufacturing enterprises in African countries. Their results point at the importance of trade policies, transportation infrastructure, energy, telecommunications, and security. They also point at the difficulties of smaller often informal firms and at the advantages of export processing zones. The role of governments in releasing those constraints is addressed in Section IV."