Trade Integration and Revealed Comparative Advantages of Sub-Saharan Africa and South Asian Merchandize Export

Abstract

Policy issues related to trade are influenced through research outputs that draw on the concept of comparative advantage of nations/regions. The facilitation of economic integration in a region is influenced with the prevailing reality of comparative advantage of a country or region. This article investigates the revealed comparative advantages (RCAs) of sub-Saharan Africa and South Asia on the export of merchandise subsectors (Food, Agricultural Raw Materials, Fuels, Ores and Metals and Manufactures) for the period 1995–2010. The study has used RCA indices, and examined the regions’ trade share in the world in relation to their respective population sizes.  The study reveals that trade in the world is skewed towards the high-income economies limiting economic integration of sub-Saharan Africa and South Asia regions with the world. Sub-Saharan Africa has RCAs on Food, Agricultural Raw Materials, Fuels, Ores and Metals export. South Asia has shown a change from RCA to comparative advantage position in export of Ores and Metals. Sub-Saharan Africa has very high competitive position in four of the five subsectors, while South Asia has improved from three to four subsectors in high competitive position. Interestingly, the study reveals that both regions have lower competitive position in manufactured goods export. Sub-Saharan Africa’s revealed competitive position is stronger than South Asia in merchandise export except in manufactured goods.