Africa is the Least Integrated Continent in the World

Sub-Saharan Africa came bottom of the class in a recent survey of trading links to the rest of the world according to third edition of its Global Connectedness Index . Research by Yale school of Management found that sub-Saharan Africa is the least integrated region in the world economy with low levels of intra-regional economic exchange and has the smallest share of global trade owing to problems such as colonial era infrastructure, structural problems, every changing policies and the “beggar thy neighbor” policies. Africa has often been praised as a success story of increasing globalization but the continent is not fully integrated into the global financial markets.

A handful of countries are becoming a part of the next wave of emerging markets. South Africa and Nigeria are benefiting very strongly from globalization.

South Africa, the economic powerhouse is in the mainstream of the emerging markets. It's has a diversified economy, but it’s very large mining sector is getting slammed by the commodity price movements. The country is yet to put in place the labor and technology policies that would allow it to really compete in the IT or services sectors.

Nigeria is the second largest economy in sub-Saharan Africa. It is the fifth largest source of U.S. oil and petroleum imports. But with the drop in the price of oil internationally the country may need to fall back to exporting agricultural products and other raw materials. This process will surely be affected by factors such as lack of post colonial infrastructure, inadequate policies and financial transparency. Nothing has been done to suggest a serious push to promote intra-regional trade.

Other better economic performers include Ghana, Tanzania, Kenya, and Botswana. By making their economies more competitive and helping their citizens participate in a global economy these countries are presently reaping the benefits that more circularity of goods, capital, and people brings. But in all this success they are also contributing to the billions of dollars lost annually due to infrastructure inefficiencies which affect trade within Africa.


Head of Operations Carmudi Africa Mohammed Iyamu suggests that Africa could learn from India’s model of open democracy and low cost infrastructure and developmental model and in the future consider the Chinese model, which is based on very heavy technical state involvement.