Sunday, 12 May 2013

Are the poor exploited?

In 2012, the US trade with Sub-Saharan Africa (SSA) came to a total of $48 billion [1] as a combination of both imports and export to the nations. This was mostly in the form of machinery and other capital equipment that could (if increased) help the African people develop. The trade with Africa accounts for a little less than 1.4% of the overall US trade to the world.

We see this in the figure below.

image

Notice, for all of the resources in Africa, they are insignificant and if all trade to SSA stopped overnight (incl. South Africa), the US would hardly notice it.

Overall, in 2012, the US GDP was $14.99 Trillion . Of this, only a small amount comes through trade with “poor” countries. This is the issue, a lack of trade and not exploitation.

Overall, the GDP from Africa as a whole (incl. the oil nations and South Africa) is tiny when compared to the USA. We see this below.

image

The entire African continent does less than the US. Not as we have seen through trade based exploitation, there is not enough trade, but through a lack of markets.

Next time you hear that the poor are exploited, know that it is through their own leaders and failed political systems and not through trade. It is trade that could help them no longer be poor.

GDP is not the best measure of trade and growth for a number of reasons I will not address here, but it is sufficient.

[1] http://www.agoa.gov/build/groups/public/@agoa_main/documents/webcontent/agoa_main_003964.pdf

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