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5.0 Diversification and Growth: Economic Report on Africa 2007

5.0 Diversification and Growth: Economic Report on Africa 2007

The presentation in the previous chapter has painted a varied picture of the results
of Africa’s efforts to diversify its economies. At the same time, regional differences
between Africa, Asia and Latin America were compared. The question then becomes
why some countries or regions achieved breakthrough in their diversification efforts
while others did not? Identifying the determinants of diversification is one part of
solving this puzzle. Linking these policy instruments to growth and development
outcomes through growth is the other part of the puzzle. This chapter is about fitting
both parts of the puzzle together.

In discussing the empirical evidence on determinants of diversification for Africa,
the underlying motivation is to deepen diversification through the use of appropriate
policies. The policy options open could be economic or non-economic. In
this regard, the presentation emphasizes physical, policy, macroeconomic and institutional
factors that influence diversification outcomes. Those that could deepen
diversification are separated from the policy options which, rather than deepening
diversification, lead to specialization.

The second part of the chapter addresses the second part of the puzzle. It focuses on
the evidence that links diversification to economic growth. Through total factor productivity
(TFP) growth, countries will be able to deepen international trade capacity,
but also significantly reduce poverty by raising their economic growth rates. The
chapter concludes by tying national diversification regimes to the established link
between diversification and economic growth.





50 Diversification and Growth Economic Report on Africa 2007 - To learn more about this author, visit United Nations Economic Commission for Africa's Website.

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United Nations Economic Commission for Africa
(Visit United Nations's Website) The United Nations Economic Commission for Africa (ECA) is the regional arm of the United Nations, mandated to support the economic and social development of its member States, foster intra-regional integration, and promote international cooperation for Africa's development.

United Nations Economic Commission for Africa is a Platinum author on EvanCarmichael.com
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21 Growth performance VI Economic Report on Africa 2007
II HOW CAN MICROFINANCE SUCCED IN AFRICA
64 Industrialization policies key to deepened diversification Economic Report on Africa 2007
IV Introduction MICROFINANCE IN AFRICA THE MODEL
51 Faster economic growth could assist in diversification efforts Economic Report on Africa 2007
31 Developments in trade negotiations IV Economic Report on Africa 2007
51 Investment is vital for an economy to diversify Economic Report on Africa 2007
Overview IV Economic Report on Africa 2007
24 Growth prospects for 2007 and the mediumterm outlook Economic Report on Africa 2007
61 Macroeconomic policies for diversification Economic Report on Africa 2007
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