Book Chapter
| 2001
Trade policy, poverty and inequality in Namibia
in Francis Wilson, Nazneen Kanji and Einar Braathen (eds.): Poverty reduction: what role for the state in today's globalized economy?. London/Bergen: Zed Books/Crop pp. 164-195
The analysis shows that trade liberalisation can be expected to lead to higher growth. Namibia conforms to the typical SSA picture of low growth and high trade barriers, which are claimed to be causally linked. The key channel is cheaper imports which stimulate exports and boost incomes of consumers.
As in many other African countries, trade liberalisation would contribute to a more equal income distribution, as the main losers on the income side are those in the formal urban sector (business and employees in these firms and in the public sector), who generally do not belong to the poor. On the downside, the evidence shows that the distributional impact is significant as compared to the efficiency and growth gains.
The gains from trade liberalisation are not as clearly positive as in other countries. On the positive side, many of the rural poor (the subsistence farmers) will gain from lower grain prices, as they are net consumers of grain. At the same time, the commercial grain farmers will lose (this will have some anti-poor impact, as far as the agricultural workers are concerned). Concerning beef, the most important agricultural product, both subsistence and commercial farmers will gain as net producers from prices increasing relative to cereals.
However, on the production side, the analysis has shown that the agricultural sector, which has the largest number of poor, faces severe obstacles to gaining from trade liberalisation.
