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Is Africa a New Potential Market for Pakistani Exporters?

Abstract: Africa is a market with tremendous potential and all the major trading blocks around the world are
enhancing their exports by increasing the trade ties with Africa. The dire situation of the Pakistan’s trade with Africa
can be judged from the fact that Africa’s imports from Pakistan (comprising mostly of low value added products) are
just 0.3% of the total imports of Africa. With a move towards new potential markets and removal of various barriers
in enhancing trade with Africa, there is a great potential for enhancing the country’s exports to Africa.

Introduction:
 Developments in means of transportation and infrastructure have eased access to any part of
the world. Many countries have realized that despite political and cultural differences,
enhancing mutual trade is imperative for economic survival.
 There is a tremendous potential for Pakistan in enhancing its trade with a great potential
market like Africa. Africa comprises around fifteen percent of the world’s population and is
one of the richest continents in the world in terms of Natural Resources. Africa has large
untapped natural resources of Gold, Diamond, Copper, Silver, Petroleum and Iron etc.
Around 15 percent of the world’s oil reserves are in Africa.
 Africa has 61 countries out of which 16-17 countries have some form of Industry. The
economies of rest of the countries are based on imports from around the world.
Furthermore with a population in excess of 1.1 Billion, there exists a huge demand base in
Africa.
 The economic growth of Africa in the recent times can be judged from the fact that two of
the fastest growing economies of the world i.e. Kenya and Nigeria are present in Africa. The
world’s most expensive city i.e. Luanda (in Angola) is also located in Africa.
 Africa is one of the regions which had been suffering from adverse security, political and
economic conditions. Things have changed in the last decade as political reforms in form of
elected governments are taking place in many African countries. African countries are
focusing on formulating sound economic policies and their effective implementation. Health
and education facilities are being improved and there is also focus on eradication of
corruption. Apart from that, a tremendous spending on infrastructure is going on in most of
the African Countries.
1. Macroeconomic Outlook of Africa
Africa’s economy has been showing satisfactory performance which is fully backed by the political
and social stability. As the world is recovering from the global financial crisis of 2008, Africa is also
giving green signals for achieving its pre-crisis growth rate.

1.1. Escalating GDP Growth:

 Macroeconomic projections remained enticing for Africa. Overall, African economy showed
an average growth rate of 4 percent during 2013 as compared to rather mediocre global
growth rate of 3 percent, showing Africa’s resilience to global economic setbacks. When we
look at the growth rates of individual countries and regions of Africa, the picture becomes
more positive. Sub-Saharan Africa registered growth rate of 5 percent. East and West Africa
performed remarkably well with growth rate of above 6 percent. The projections of 2015
emphasize that the continent would achieve its pre-global recession rate of 5 - 6 percent See
Fig 1).

7.0
Figure 1: Africa’s Economic Growth
6.4
6.0 5.7
6.2 6.4
5.7 5.9
5.0 5.6 5.6 3.5
5.2 3.9 5.2
5.0 4.8
4.0
4.3 4.1 4.2
3.0 4.3
3.1
2.0

1.0

0.0
2012
2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2013

2014

2015(p)

Source: African Develooment Bank


Note: (e) estimates; (p) projections Africa Africa excluding Libya

 Africa’s inflation rate decreased in 2013, mainly due to stable energy costs and ebbing food
prices. However, inflation rates varied from country to country due to unstable currencies of
the region. Lowering inflation helped African countries in easing their monetary policies
while countries with higher inflation happened to tighten the monetary policies. Prudent
fiscal policies were pursued in the continent to boost up economic growth.
 Most of the African countries managed to increase their tax revenues. It is expected that
taxation reforms in Africa would be more strengthened and tax base would be enhanced
further in coming years.

1.2. Encouraging Trade Performance of Africa:

 Despite sluggish growth in world trade, an improvement in Africa’s trade has been observed
in recent years. The trade in agricultural goods and services remained below their potential,
while the primary commodities remained dominant in African exports.
 Trade in manufacturing goods has made progress in intra-African trade which is a step
towards regional integration.
 Africa’s share in total merchandise exports and imports is estimated to be 3.3 and 3.4
percent respectively. (See Fig 2 and 3).
 Europe is the largest exporter and importer of the world with the share of 36.3 percent and
35.8 percent in exports and imports respectively. Asia stands at second with share of 31.5
percent and 35.8 percent in world exports and imports.

Fig 2: World Merchandise Exports by Fig 3: World Merchandise Imports by


Regions in 2013 (% share) Regions in 2013 (% share)
North America North America

South and Central South and


America 17.4 Central America
13.2
Europe 31.8 Europe
31.5 4.0
4.2
Commonwealth of Commonwealth
Independent of Independent
States (CIS) States (CIS)
Africa Africa
4.2
7.4 36.3 3.4 35.8
Middle East 3.1
3.3 Middle East
4.3
Asia
Asia

Source: World Trade Organization


2014

 From 2005 to 2013, Africa’s exports grew impressively by 20 percent while imports
registered growth rate of 19.7 percent.
1.3. External Financial flows:

 Total external financial inflow to Africa reached around US$ 200 billion in 2014 which is
four times higher than 2000. Both foreign direct and portfolio investments totaled around
US$ 80 billion in 2014 which shows full recovery from economic crisis. Greenfield projects
of Africa are attracting huge investments while manufacturing and services are also receiving
investments.
 External financial assistance remained a significant contributor to African economy. Though
the Official Development Assistance (ODA) from advanced countries to Africa has
decreased but still remained the largest external inflow in Africa’s foreign account, with the
value of US$ 55.2 billion in 2014.
 It is projected that portfolio investment, foreign direct investment and foreign remittances to
Africa would increase if the current growth rate is sustained.

Fig 4: Financial Flows to Africa (Current, US$ billion)


74

54

34

14

-6 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Foreign Direct Investments Portfolio Investments


-26
Source: African Develooment Bank Remittances Official Development Assistance

 Africa is bestowed with natural resources like oil and minerals which are attracting large
foreign investment. Foreign direct investment (FDI) has almost been doubled since 2005.
FDI increased from US$ 33.8 billion in 2005 to US$ 60.4 billion in 2014. Portfolio
investment increased tremendously from US$ 6.3 billion in 2005 to US$ 23.9 billion in 2014.
 As a matter of fact, 95 percent of FDI was directed to resource-rich countries during 2013 in
which South Africa ranked atop. Algeria, Namibia and Nigeria are the countries that have
received record FDI of over US$ 0.5 billion each in 2013.
 Remittances have grown remarkably from US$ 33.3 billion in 2005 to US$ 67.1 billion in
2014.

1.4. Strengthening Political and Economic Governance:

 Political and economic governance has changed its long suffering outlook and reputation in
Africa. Inequalities in economic and social lives of the people have been changing slowly but
steadily. Africa has been experiencing free and fair elections since 2010. It is anticipated that
2014-15 is the year in which around 600 million Africans will elect their leaders, bringing
further political stability in the continent.
 Tunisia has been finally enjoying the democratic government since early 2014. Due to Arab
Spring uprising, North African countries remained slow in progressing towards democratic
setup while South Sudan and Central African Republics are still combating the civil conflicts
and varied crisis.
 Africa is the resource-rich region that requires dedicated efforts for initiating public sector
reforms to improve the management of national resources and business environment.

1.5: Human Development


 Human development indicators are improving in Africa, with few countries lagging behind.
Poverty is reported to have decreased slightly. Reforms for improvement in education and
healthcare sectors are initiated and employment generation is on roll. However, inequality in
provision of social and economic services still persists. Programs should be initiated to
improve gender equality and youth empowerment which are the growing assets of Africa.

2. Africa - Exceeding the Trade Verge:

Africa has gone through a decade of tremendous economic transformation. According to the latest
survey conducted by Ernst & Young, Africa has turned out to be an attractive market over the past
three years. South Africa, Nigeria, Egypt, Mozambique and Ghana, among other 19 countries have
been identified as fast emerging markets in Africa with the satisfactory performance in political,
economic, legal and transparency fronts.

2.1. Current Trade Scenario of Africa vs World:


 Total trade of Africa with the world valued at US$ 1,205.37 billion in 2013, showing the
growth of 20.2 percent since 2005 (See Fig 5). Trade has shown somewhat downward trend
in 2014.

Fig 5: Exports - Imports: Africa vs World (US$ Billion)


800.00
Imports Exports
700.00

600.00

500.00

400.00

300.00

200.00

100.00

0.00
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Imports 218.41 273.30 345.67 456.63 399.78 478.69 565.59 576.18 605.82 118.63
Exports 211.82 316.67 384.33 530.36 367.45 494.96 620.89 667.13 599.54 95.83

Source: Trademap, ITC

 Africa’s imports with its partners increased from US$ 218.41 billion in 2005 to US$ 605.82
billion in 2013 but decreased significantly to US$ 118.63 billion in 2014.
 Exports of Africa escalated remarkably from US$ 211.82 billion in 2005 to US$ 667.13
billion in 2012. Exports started decreasing sharply afterwards and reached their lowest level
of US$ 95.83 billion in 2014.
 Projections tell that this fall in trade is not permanent and exports and imports of Africa
would soon be geared up.

2.2. Analysis of Country-wise African Imports:

 With the gradually stabilizing political conditions of Africa, demand for goods and services
has increased in African countries. Table 1 shows the trend in imports of Africa in the
period 2009 to 2013. It can be seen that in 2013, the imports of Africa stood at around US$
605.82 Billion, which was around 3.2 percent of the total imports of the world.
 South Africa was the major contributor in the imports of Africa. The imports of South
Africa valued around US$ 103 billion and accounted for 17% of the total imports of Africa.
Other major contributors in the imports of Africa were Egypt (11%), Algeria (9%), Nigeria
(8%) and Morocco (7.5%).
 The imports of Africa increased by more than 50% from 2009 to 2013 with South Africa
recording the biggest increase of 63%. Egypt recorded an increase of 50%, Nigeria 48%,
Morocco 40% and Algeria 38% in its imports from 2009 to 2013. The imports of the
relatively smaller African Economies like Libya, Tunisia, Tanzania and Kenya also recorded a
sharp increase from 2009 to 2013.

Table 1: Largest Importers of Africa (US$ Billion)


Importers 2009 2010 2011 2012 2013
South Africa 63.77 82.95 102.70 104.15 103.46
Egypt 44.91 53.00 62.28 69.87 66.67
Algeria 39.26 41.00 47.22 50.37 54.91
Nigeria 33.91 44.24 63.97 35.87 49.14
Morocco 32.88 35.38 44.26 44.79 45.62
Libya 12.86 17.67 7.11 19.72 24.42
Tunisia 19.10 22.22 23.95 24.47 24.27
Angola 17.54 15.71 17.94 20.62 22.23
Kenya 10.20 12.09 15.03 15.18 16.52
Liberia 11.67 16.48 18.27 16.03 13.23
Tanzania 6.53 8.01 11.18 11.72 12.53
Côte d'Ivoire 6.96 7.85 6.72 9.77 12.48
Ethiopia 7.97 8.60 8.90 11.91 10.96
Zambia 3.79 5.32 7.18 8.81 10.16
Mozambique 3.76 3.56 6.31 6.18 10.10
Ghana 6.46 8.06 13.57 14.01 10.02
Sudan (North + 8.59 11.87 9.55 7.51 8.39
South)
Congo 4.45 4.37 7.01 7.35 8.37
Zimbabwe 3.53 5.85 8.60 7.36 7.70
Source: Trademap, ITC 2014

2.3. Product-wise African Imports from world


 It can be observed in Table 2 that Mineral Fuels, Oils and Distillation products are the
biggest product group in the African imports and comprised 16% of the total imports in
2013. Petroleum oils (crude and non-crude) were the predominant commodity in this group,
comprising 86% of the total import value of this product group.
 Machinery items comprise around 11.5% of the total imports of Africa. The main machinery
products that are imported are bulldozers, angledozers, graders, excavators, automatic data
processing machines, optical readers, printing machines, turbo-jets, turbo-propellers, gas
turbines and many others.
 Vehicle including cars, trucks, motor vehicle parts, tractors and motor cycles are the third
biggest import group of the African market. This group comprised of 8.3% of the total
imports of Africa in 2013.
 Africa also has sizeable imports of electronic equipment. This product group comprised 7%
of the total imports of Africa in 2013.
Table 2: Product-Wise Imports of Africa
Code Product label 2011 2012 2013
'27 Mineral fuels, oils, distillation products, etc 85.82 96.95 99.36
'84 Machinery, nuclear reactors, boilers, etc 65.69 65.14 70.22
'87 Vehicles other than railway, tramway 45.01 52.29 50.40
'85 Electrical, electronic equipment 42.54 40.45 43.91
'10 Cereals 27.41 26.00 23.36
'89 Ships, boats and other floating structures 23.92 16.45 22.29
'39 Plastics and articles thereof 17.86 18.20 20.59
'72 Iron and steel 17.16 18.93 19.12
'73 Articles of iron or steel 16.50 16.23 17.13
'30 Pharmaceutical products 11.99 13.19 15.29
'99 Commodities not elsewhere specified 6.61 11.20 11.36
'90 Optical, photo, technical, medical, etc apparatus 7.90 8.01 9.67
'15 Animal, vegetable fats and oils, cleavage products, 10.42 9.11 8.70
etc
'40 Rubber and articles thereof 8.04 7.52 7.90
'48 Paper and paperboard, articles of pulp, paper and 7.66 7.47 7.62
board
'38 Miscellaneous chemical products 6.77 6.99 7.14
'17 Sugars and sugar confectionery 8.13 7.34 6.74
'29 Organic chemicals 6.04 6.22 6.01
'71 Pearls, precious stones, metals, coins, etc 2.50 4.24 5.94
'25 Salt, sulphur, earth, stone, plaster, lime and cement 5.79 6.20 5.88
Source: Trademap, ITC

3. Bilateral Trade between Pakistan and Africa:

Though trade between Pakistan and Africa has been increasing gradually but Africa is still an
untapped market for Pakistani exporters. Total trade between Pakistan and Africa increased
significantly from US$ 1,737.66 million in 2005 to US$ 3,069.55 million in 2013. Trade Surplus of
US$ 674.53 million was recorded in 2013. Africa’s total trade with Pakistan contributed 4.46 percent
of Pakistan’s total trade which is quite low.

 Pakistan’s exports to African have experienced several ups and downs since 2005. Exports
increased modestly from US$ 917.30 million in 2005 to US$ 985.41 million in 2007. In 2008
when the world had been going through the worst financial crisis of the time, demand for
Pakistani exports to Africa accelerated significantly and reached to US$ 1,372.10 million in
2008. Exports increased further to US$ 1,872.04 million in 2013, the highest level in the
history (See Fig 6).
 Pakistan’s imports have shown the same trend as exports. Pakistan’s imports from Africa
increased from US$ 820.36 million in 2005 to US$ 1,425.61 million in 2011. Imports from
Africa decreased afterwards and dropped down to US$ 1,197.51 million in 2013.

Fig 6: Trade between Pakistan and Africa


2000.00
Pak's Exp to Africa Pak's Imp from Africa
1800.00
1600.00
1400.00
1200.00
1000.00
800.00
600.00
400.00
200.00
0.00
2005 2006 2007 2008 2009 2010 2011 2012 2013

Source: Trademap, ITC

3.1. Africa’s Imports from Pakistan: Detail Product–wise Analysis:


 The Table 3 presents a complete picture of Africa’s imports from Pakistan. Africa’s imports
from Pakistan in 2013 stood at US$ 1.89 Billion, which was just 0.3% of the total imports of
Africa.
 Almost 40 percent of the Africa’s imports from Pakistan are cereals, comprising almost
completely of rice. A little quantity of maize (corn) is also imported but quite negligible as
compared to the volume of rice.
 Africa’s imports in the group “Salt, sulphur, earth, stone, plaster, lime and cement” were
around 10 percent of the total imports of Africa from Pakistan, comprising mainly of
cement, aluminous, slag, supersulfates and hydraulics.
 Cotton imports are around 8.5 percent of the total imports of Africa from Pakistan. Cotton
imports are dominated by the imports of woven cotton fabrics and cotton yarn.
 Sugar products comprised around 7 percent of the total imports of Africa from Pakistan in
2013. Sugar imports were dominated by cane/beet sugar and chemically pure sucrose.
 Manmade fibres are also imported by Africa, with imports of over US$ 120 million in 2013
(6.4% of the total imports of Africa from Pakistan). The imports of manmade fibres were
dominated by Woven fabrics of synthetic staple fibres.
 Textile items like bed, table, toilet, kitchen linens and worn clothing are among the products
whose imports valued at US$ 100 million (5.4% of the total imports of Africa from Pakistan
in 2013). These imports also include tents and camping goods.

Table 3: Pakistan Trade with Africa (US$ million)


Prod Africa's Imports from
Pakistan's Exports to world Africa's Imports from world
uct Product label Pakistan
code 2011 2012 2013 2011 2012 2013 2011 2012 2013
'10 Cereals 875.26 637.86 751.81 2807.33 2060.80 2181.05 27000.00 26002.75 23364.24
Salt, sulphur, earth, stone, plaster,
'25
lime and cement 194.45 158.20 192.12 570.63 714.07 722.82 5793.86 6204.04 5878.97
'52 Cotton 198.99 171.08 163.49 5097.13 5225.69 5333.78 3764.30 3271.43 3760.97
'17 Sugars and sugar confectionery 3.21 65.32 137.88 66.65 253.54 633.57 8129.44 7336.70 6736.94
'55 Manmade staple fibres 120.27 102.99 120.99 605.99 449.18 418.17 2527.35 2604.60 2701.95
Other made textile articles, sets,
'63
worn clothing etc 82.01 102.34 102.52 3570.36 3285.35 3685.49 2791.59 2826.64 3358.53
Vehicles other than railway,
'87
tramway 20.08 34.04 35.19 81.77 71.78 74.18 45000.00 52290.39 50401.57
'30 Pharmaceutical products 21.66 21.75 28.88 150.67 167.81 169.47 12000.00 13190.58 15293.11
'39 Plastics and articles thereof 31.79 56.89 25.86 543.88 520.99 449.79 18000.00 18199.41 20593.73
'73 Articles of iron or steel 2.42 10.23 22.57 200.48 271.29 180.42 16000.00 16231.06 17127.03
Machinery, nuclear reactors,
'84
boilers, etc 20.52 21.37 21.28 235.18 184.12 179.39 66000.00 65141.99 70217.25
Optical, photo, technical, medical,
'90
etc apparatus 34.53 10.90 19.75 302.46 319.11 348.08 7899.44 8007.26 9665.68
Vegetable, fruit, nut, etc food
'20
preparations 8.79 11.60 19.49 56.03 64.87 69.31 1775.55 1910.75 2163.57
Articles of apparel, accessories, not
'62
knit or crochet 35.48 13.77 18.55 1774.67 1694.39 1854.93 3135.07 3191.72 3732.10
Paper and paperboard, articles of
'48
pulp, paper and board 8.32 11.33 17.51 29.78 40.28 57.45 7656.10 7466.32 7620.28
'54 Manmade filaments 17.81 20.14 16.65 37.99 34.13 30.35 2123.94 2413.36 2863.08
Raw hides and skins (other than
'41
furskins) and leather 11.79 13.97 16.24 467.88 457.40 529.70 945.76 488.96 504.43
Articles of apparel, accessories, knit
'61
or crochet 8.21 10.62 15.30 2238.85 2006.29 2105.32 2076.14 2601.55 3095.64
Fish, crustaceans, molluscs, aquatic
'03
invertebrates nes 15.89 16.39 13.36 261.05 292.21 333.13 4761.33 4458.65 3964.17
Wadding, felt, nonwovens, yarns,
'56
twine, cordage, etc 1.62 1.21 12.56 28.98 16.57 27.34 884.83 925.47 1011.91
Source: Trademap, ITC

4. Potential Markets in Africa for Pakistani Exporters:

 It can be observed from the previous analysis that there is not much correlation between the
top African imports from the world and the top African imports from Pakistan.
 The top African imports from the world consist of high value added products like Mineral
Fuels, Machinery, Vehicles, Electronics, Ships/Boats. Compared to that, the top African
imports from Pakistan consist of primary and low value-added items like cereals, cotton,
sugar and clothing etc. To enhance Pakistan’s export potential to Sri Lanka, Pakistan will
have to move towards the higher value added products.

4.1. Potential for Pharmaceutical products:


 Pharmaceutical products of Pakistan have not been able to exploit the Sri Lankan markets.
There is a considerable potential for Pakistan to enhance its exports of pharmaceutical
products to Sri Lanka. In 2014, Sri Lanka’s pharmaceutical imports from Pakistan stood at
around US$ 29 million, just 0.19% of its total pharmaceutical imports of around US$ 15
billion.
 The African countries where demand for pharmaceutical products is increasing are Algeria,
South Africa, Egypt, Nigeria, Tunisia, Morocco, Libya, Ethiopia, Kenya, Sudan (North and
South), Uganda, Tanzania and Cameron.
 Under the group of Pharmaceutical product (HS Code 30), the following products have
increasing demand in Africa:
o Medicament mixtures (not 3002, 3005, 3006), put in dosage
o Human & animal blood; antisera, vaccines, toxins, micro-organism cultu
o Medicament mixtures (not 3002, 3005, 3006) not in dosage
o Pharmaceutical goods, specified sterile products sutures, laminaria, b
o Dressings packaged for medical use
o Glands & extracts, secretions for organotherapeutic uses; heparin & it

4.2. Potential for Machinery Exporters:


 In 2013, Africa’s total import of Machinery Group (HS Code 84) from the world stood at
US$ 70.22 Billion, while the imports from Pakistan were only US$ 21.28 million. There is a
huge potential for the export of Pakistani machinery products to Africa.
 Major importers of Machinery in Africa include South Africa, Algeria, Egypt, Nigeria,
Morocco, Angola, Libya, Tunisia, Zambia, Ethiopia, Kenya and Ghana.
 The machinery products which have significant demand in Africa are:
o Self-propelld bulldozer, angledozer, grader, excavator,etc
o Automatic data processing machines;optical reader, etc
o Machinery part (hd 84.25 to 84.30)
o Tap,cock,valve for pipe,tank for the like,incl pressure reducing valve
o Pumps for liquids; liquid elevators
o Turbo-jets, turbo-propellers and other gas turbines
o Machinery for sorting/screening/washg;agglomeratg/shapg mineral produc
o Machines&mech appl having indiv functions, nes
o Centrifuges, incl centrifugal dryers; filtering/purifying machinery
o Refrigerator, freezer, etc
o Air, vacuum pumps; hoods incorp a fan

4.3. Potential for Auto Industry:


 There is a great scope for increasing the export of vehicles to Africa. The African imports of
vehicles (HS Code 87) from Pakistan in 2013 stood around US$ 35 million, which is only
0.07 percent of Africa’s total imports of vehicles.
 The commodities under Vehicle group which have potential for Pakistani exporters are:
o Cars (incl. station wagon)
o Trucks, motor vehicles for the transport of goods
o Parts & access of motor vehicles
o Tractors (other than tractors of heading no 87.09
o Motorcycles, side-cars
o Public-transport type passenger motor vehicles
o Specl purp motor vehicles (fire fight veh,crane lorry)
o Trailers&semi-trailers;other vehicles not mechanically propelled
o Bodies for motor vehicles
o Parts and accessories of motorcycles & cycles
o Bicycles & other cycles, not motorized
o Chassi fitted with engine for motor vehicles
o Tanks and other armoured fighting veh, motorised, and parts
o Work truck,self-propeled, for factorie/airport & parts
o Baby carriages and parts thereof
o Invalid carriages (wheelchairs), w/n motorised
 Countries which are importing vehicles and related products are South Africa, Algeria,
Nigeria, Morocco, Egypt, Libya, Tunisia, Angola, Kenya, Ghana and Ethiopia.

4.4. Potential for Agriculture exporters:


 The African imports of Cereals (HS Code 10) from Pakistan in 2013 were US$ 751.81
million, which is only 1.71 percent of Africa’s total imports of cereals (US$ 43.91 Billion).
 The Africa’s imports of vegetables from Pakistan in 2013 were only US$ 19 million. There is
a great potential to increase the export of vegetables and fruits (especially kinnows) to the
African markets
 The following commodities under Cereal Group have the potential to be exported to Africa:
o Wheat and meslin
o Rice
o Maize (corn)
o Barley
o Grain sorghum
o Buckwheat, millet and canary seed
o Oats
o Rye
 Top importers of Agriculture products in Africa are Nigeria, Algeria, Morocco, South Africa,
Libya, Tunisia, Sudan (North and South), Côte d'Ivoire, Senegal, Benin, and Kenya.

4.5. Potential for Plastic Industry in Africa


 Plastic (HS Code 39) is one of the major imports of Africa. The total imports of plastic
products were over US$ 20 billion in 2013. The inability of Pakistani plastic products to tap
this huge market can be judged from the fact that Africa’s imports of plastic from Pakistan
in 2013 were only US$ 25 million, mere 0.1% of the total imports of plastic by Africa. It is
worth mentioning that Pakistan’s exports of plastic products in 2013 were around US$ 500
million. Considering the imports of Africa from world, Pakistan can increase its exports to
Africa.
 Egypt, South Africa, Algeria, Nigeria, Morocco, Tunisia, Kenya, Libya, Angola, Tanzania,
Sudan (North & South), Ethiopia, Ghana, Côte d'Ivoire, Zambia, Uganda, Zimbabwe,
Congo, Senegal, Mozambique and Cameron are the major importers of plastic in Africa.
 Following commodities under Plastic group are being imported into Africa:
o Polymers of ethylene, in primary forms
o Polyacetal, o polyether, epoxide resin, polycarbonate,etc,in primary form
o Polymers of propylene or of other olefins, in primary forms
o Plastic packing goods or closures stoppers, lids, caps, closures, plas
o Other plates, sheets, film, foil, tape, strip of plastics etc.
o Article of plastic nes.
o Tubes, pipes & hoses & fittings therefor of plastics
o Polymers of vinyl chloride/other halogenated olefins, in primary forms
o Polymers of styrene, in primary forms
o Plates, sheets, film, foil and strip, of plastics, nes
o Acrylic polymers in primary forms
o Self-adhesive plates, sheets, film etc of plastic w/n in rolls
o Tableware, kitchenware, toiletery articles, of plastic
o Amino-resins, pheonolic resins and polyurethanes, in primary forms
o Builders' ware of plastics, nes

4.6. Potential for Iron & Steel


 Africa is importing two types of commodities under this head; Iron and Steel (HS Code: 72)
and Articles of Iron and Steel (HS Code: 73). Imports of Iron and Steel stood at US$ 19.12
billion while the imports of Articles of Iron and Steel were valued at US$ 17.13 billion in
2013.
 Pakistan exported Articles of Iron and Steel worth of US$ 2.42 million in 2011 to Africa
which increased greatly to US$ 22.57 million in 2013.
 Under Articles of Iron and Steel, Africa is importing following commodities:
o Structures (rods,angle, plates) of iron & steel nes
o Articles of iron or steel nes
o Tubes, pipes and hollow profiles of iron or steel, nes
o Tubes, pipes and hollow profiles, seamless, or iron or steel
o Tube or pipe fittings, of iron or steel
o Iron & steel screws,bolts,nuts,coach-screws, etc
o Tubes&pipe nes, ext diam >406.4mm,of iron &steel
o Iron & steel tables & household articles
o Iron & steel stoves,ranges,barbecues &sim non-elec dom app
o Iron &steel tank,cask,drum can,boxes (cap<=300l)
o Rrail, crossing piece, iron/steel
o Iron & steel strandd wire,ropes,cables, etc,not electrically insulated
o Iron&steel reservoirs,tanks,vats (cap >300l)
o Containers for compressed or liquefied gas, of iron or steel
o Cloth, grill, netting&fencing, of iron & steel wire
 Major importing countries of these products in Africa include Egypt, Algeria, South Africa,
Nigeria, Angola, Morocco, Libya, Zambia, Tanzania, Ethiopia, Ghana, Tunisia, Kenya and
Congo.
 Commodities under the import group Iron and Steel (HS Code 72) comprise of:
o Bars&rods of iron/non-al/s, nfw than forged, hr, hd,/hot-extruded
o Flat-rolld products of iron/non-al/s wdth>/=600mm,hr,not clad
o Flat-rolled prod of iron or non-al/s wd>/=600mm,clad, plated or coated
o Semi-finished products of iron or nonalloy steel
o Bars & rods, hr, in irreg wound coils, of iron or non-alloy steel
o Ferrous waste and scrap; remelting scrap ingots or iron or steel
o Angles, shapes and sections of iron or non-alloy steel
o Flat-rolld prod of iron/non-alloy steel wd>/=600mm,cr,not clad
o Bars&rods,other alloy steel; hollow drill bars, etc
o Flat-rolled products of other alloy steel, of a width of 600mm or more
o Wire of iron or non-alloy steel
o Ferro-alloys
o Flat-rolled products of stainless steel, of a width of 600mm or more

4.7. Potential for Miscellaneous Sectors:


 Technical Apparatus: Africa has sizeable imports of technical apparatus (optical, medical,
photo etc) i.e. US$ 9.6 billion dollars in 2013 but the imports from Pakistan are even less
than US$ 20 million. The main product imported in this category from Pakistan is the
electro-medical apparatus (electro-cardiographs, infra-red ray app).
 Surveying and Meteorological Equipment: There is a great scope for Pakistan to
enhance the export of surveying and meteorological equipment to Africa. Africa is importing
only US$ 2.3 million worth of surveying and meteorological equipment from Pakistan while
imports from the world stand around US$ 700 million.
 Paper Products: Paper products are also widely imported by Africa and their total imports
in 2013 stood at US$ 7.6 billion. The imports of paper products from Pakistan were only 0.2
% of the total paper imports and stood at US$ 17.5 million. There is great potential for
Pakistan to increase its exports of paper products to Africa, especially the packing paper in
which the African imports from Pakistan are even less than 0.5 million as compared to total
African imports of US$ 955 million.
 Leather Goods: Leather is one of the major export items of Pakistan and its exports in 2013
were around US$ 745 million dollars. It is however surprising that Pakistani leather exports
to Africa are almost negligible (around US$ 10 million). There is a tremendous potential for
the Pakistani leather products to make their way in the African market. It is pertinent to
mention that Africa’s total import of leather products in 2013 were above US$ 1 billion.
 Apparel: Pakistan’s total exports of apparel were over US$ 2 Billion in 2013. However the
exports of apparel to Africa were only US$ 15 million. This is very surprising since Africa’s
imports of apparel crossed US$ 3 billion in 2013. There is a tremendous scope of increasing
the exports of women clothing as Africa’s import of women clothing in 2013 was over US$
500 million. There is also ample potential in enhancing the exports of Jerseys, pullovers,
gloves and babies garments. Men’s suits are also imported around the world from Africa,
presenting an option for the exporters to increase the exports in this area.
5. Major Obstacles in Trading with Africa:

 Banking Channels: The Banking sector in Africa is not strong. Multinational Banks are not
present in majority of the African countries. The local African Banks don’t have
corresponding relations with the International Banks. The lack of Banking Channels in
Africa deters the potential exporters /importers in other countries to enhance their trade
with African countries

 Legal Hurdles: The information about the duty structures and legal requirements in Africa
is not available on the web and other sources. This makes it very difficult for the potential
exporters to apprise themselves of all the requirements for exporting to Africa.

 Language Barrier: The language barrier in Africa in quite prevalent as Sohali is spoken in
majority of the African countries. The businessmen in majority of the African countries are
not well versed in English which hinders effective communication with the potential
exporters/importers in the other countries.

 Presence of very few Embassies: Africa has 61 countries and yet Pakistan has only 12
embassies in whole Africa. Most of these embassies have limited capacity with staff of less
than 5 personnel and hence cannot play an effective role in improving the liaison between
the business communities of Pakistan and Africa. India has around 30 Embassies, High
Commission and Consulates in Africa.
References:

African Economic Outlook. Retrieved from http://www.africaneconomicoutlook.org/en/

Data on All Economic Indicators. African Development Bank. Retrieved from


http://www.compareyourcountry.org/african-economic-outlook?cr=afr&lg=en&project=african-
economic-outlookOECD. http://www.oecd.org/africa/

Key developments in 2013: a snapshot, World Trade Organization. Data retrieved on


http://www.wto.org/english/res_e/statis_e/its2014_e/its14_world_trade_dev_e.htm and
http://www.wto.org/english/news_e/pres14_e/pr722_e.htm .

OECD Investment Policy Reviews. Retrieved from


http://www.oecd.org/investment/countryreviews.htm.

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