The Effects of the Global Financial Crisis on Exports in Least Developed Countries

"This study tries to shed some light on the actual and possible effects of the GFC on trade in LDCs, specifically focusing on the 32 states that make up the World Trade Organization’s LDC Group. The analysis is particularly important for sub-Saharan Africa as 25 of these 32 countries are from the region, representing more than half of the countries in sub-Saharan Africa. More-over even non-LDCs sub-Saharan African economies share many of the characteristics of LDCs in terms of trade specialisation (commodities and unskilled manufacturing)and factor endowments, making the analysis potentially relevant for the entire region. Given the dependence of many of these countries on trade, a large part of the effect on them of the downturn will have to do with the way trade prospects are affected by the GFC. Identifying the countries and the sectors which are more likely to suffer the adverse trade-related consequences of the crisis is also useful in designing the possible policy responses."