Informal trade flows exceed official trade statistics in parts of Africa

by Steven Langdon

 

There are challenges to relying on official statistics in parts of Africa,  as we discuss in our recent book (African Economic Development, by Langdon, Ritter and Samy — published by Routledge in 2018.)

Recent evidence from Benin suggests these challenges may be particularly great in measuring trade flows between individual African countries,  with much trade being carried out informally by small-scale traders without being calculated numerically at border posts.  Three researchers (Jarreau, Mitaritonna and Bensassi) have undertaken a large scale survey of informal traders crossing the Benin-Nigeria border, asking them the extent of their import and export of goods — then comparing this with official trade statistics for the same 171 border points.

The results were dramatic.  Some 85% of exports were not recorded and 50% of imports.  The goods involved are not just agricultural products,  but include a diverse range,  including textiles and transportation equipment.

As the researchers conclude, “this confirms that trade statistics on the continent suffer from a serious blind spot.”  Given the importance African countries are giving to initiatives for continental free trade,  the gaps in existing trade measurement are especially problematic.  This blind spot on trade statistics also underlines the wider need to improve official statistics in other areas to contribute to better African economic policy-making.

For more details on this Benin research, please see the attached link.

https://qz.com/africa/1402733/trade-between-african-countries-has-been-underestimated-by-economists/

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