1. Infrastructure and Regional Integration-Agro-industry Nexus
ECA
Infrastructure and Regional Integration-Agro-industry Nexus
Dr. Stephen Karingi
Director, Capacity Development Division
26 April 2017
Victoria Falls, Zimbabwe
Global Expert Meeting on Agriculture and Agro-industries Development towards Sustainable and
Resilient Food Systems

2. Infrastructure Development, Regional Integration & Agro-Industrialization Nexus: a Conceptual Framework
ECA
Infrastructure assets (e.g: energy, water) as inputs for agro-industry sector (agro-manufacturers)
Infrastructure services (transportation incl. shipping, ICTs) needed by agro-industries
Direct
Efficiency gains from economies of scale and scope (e.g. connectivity within and outside local market such as improved regional integration)
Better access and efficient use of technology
Promotion of FDI inflows – attractiveness
Improved education and health of workers
Indirect
Infrastructure
Development
Agro-industrialization
Regional integration
Agro-industrial development stimulates infrastructure investment to fulfil infrastructure demand by agro-industry
Agro-industrial development also strengthens regional integration through (a) improved intra-trade, (b) sustained linkages among production and consumption centers at regional level, and (c) stimulated investment in regional infrastructure to fulfill the demand of increased intra-trade in agricultural commodities and products
UNECA.ORG

3. Regional Integration State: Africa Regional Integration Index
ECA 3
Why?
Measuring where Africa stands on regional integration gives an assessment of what is happening across the continent and is an important way of highlighting where the gaps are. It is a dynamic, evolving way to track integration by giving everyone access to verified, quality information to start a dialogue and take forward the next steps to integrate Africa.
Structure?
Global Expert Meeting on Agriculture and Agro-industries Development
UNECA.ORG

4. Regional integration: RECs achievement
ECA 4
REC
Trade integration
Regional infrastructure
Productive integration
Free movement of people
Financial and macro-economic integration
Average
CEN-SAD
0.353
0.251
0.247
0.479
0.524
0.3708
COMESA
0.57
0.439
0.452
0.268
0.343
0.4148
EAC
0.78
0.496
0.553
0.715
0.156
0.54
ECCAS
0.526
0.451
0.293
0.4
0.599
0.4538
ECOWAS
0.442
0.426
0.265
0.8
0.611
0.5088
IGAD
0.505
0.63
0.434
0.454
0.221
0.4488
SADC
0.508
0.502
0.35
0.53
0.397
0.4574
UMA
0.631
0.491
0.481
0.493
0.199
0.459
Average of eight RECs
0.461
0.384
0.517
0.381
0.4566
Global Expert Meeting on Agriculture and Agro-industries Development
UNECA.ORG

5. Regional integration state: Intra-trade perspectives
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
70,000,000
80,000,000 I
Intra-African trade of manufactured and other products over time
Labour
intensive and resource
intensive manufactures
Low
skill and technology
Medium
High
Other products
Share of Africa’s imports
from Africa vs. from rest of the world – 2012

6. Indeed, very serious challenges remain to harness Africa’s agribusiness potential locally to global
The costs of trading across borders within Africa remain high on average with transport costs faring 100% higher on the average compared to levels observed in the developing world
Africa’s international infrastructure networks, such as the Trans-African Highway network continue to have missing links resulting in broken regional supply chains and costly value chain channels to fix
Flight connectivity is centered around a limited number of continental hubs
Lack of energy security is another constantly mentioned nightmare in industry surveys. Quality of electricity or energy security is another top concern, second only to access to finance in similar surveys to assess the binding constrains to agro-industry growth in Africa over
Several internal administrative obstacles to free trade persist in the form of tariffs and non- tariff barriers (NTBs), and also non-core NTBs: illegal roadblocks, fees and bribes encourage informal cross-border trade involving higher costs and risks for traders and consumers
The agricultural supply and marketing system itself is excessively fragmented, underequipped, underfinanced and poorly organized to cope with a dynamic urban food demand
Level of Gross expenditures in R&D is still very low to make a difference (less than 1 % of GDP)
Title of the presentation goes here | Sub-Title goes here
UNECA.ORG
ECA

7. Infrastructure and processing capacity development at scale matter
Côte D’Ivoire – a dormant agri business nation
Source: ERA, UNECA (2016)
As a result of a weak continent wide infrastructure set up and high barriers to trade to connect the regions, very little is processed locally from readily rich agriculture portfolios for intra-African outlets : Cote d’ivoire is a good case in point but not alone for the missed industrialization boat despite its relatively good national infrastructure network to suggest going at scale with regionally pooled infrastructure investment if African agribusiness and agro industrialization are to thrive and make a difference.
UNECA.ORG
ECA

8. Regional Integration and agro-industrializing: efforts and key issues
ECA
1. Accelerating the implementation of BIAT, TFTA & CFTA
Initiatives aimed at fostering intra-trade through providing for enabling environment, in terms of regulatory and standards frameworks.
Though endorsed (BIAT & TFTA), a strong political will is urgently needed for implementation
Initiatives cater for providing adequate opportunities for small economies to benefit of facilitated trade environment.
FTAs provides for duty-free trade of agricultural products
2. Fast track the implementation of PIDA
Initiative aimed at accelerating the implementation of prioritized sub-regional and regional infrastructure projects in Africa in transport, energy, trans-boundary water and ICT
accelerate the facilitation of intra-Africa energy trade, essential for powering agro- industry
Set up an adequate institutional framework for the development of major integrative power projects
Development of supportive initiatives and strategies is critical just as their implementation and coordination at national, sub-regional and regional levels.

9. Regional Integration and agro-industrializing: efforts and key issues
ECA
3. Value chain maximization and regional integration
- Pursuing regional integration provides a room for the promotion of RAVCs allowing for:
Economies of scale for agro- industrialists upon access larger markets and diversification
Production and manufacturing according to comparative advantage
Increasing cost efficiency and competitiveness
Enhance capacity to access GVCs
Need to promote appropriate technologies & innovations along the VCs,
Support market development for commodities and processed goods via VCs
Share of intra-regional trade vs. share of regional value
added in the intra-regional trade, by main region, 2011, %
Source: WTO, International Trade Statistics (2012) and ECA computations

10. more info: www.uneca.org
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