This paper gives a general overview of trade figures and dynamics in the ECOWAS region with a focus on agricultural and food products. The study points to some of the overarching actors and factors that shape these regional trade flows at a broad level, in order to inform relevant stakeholders and guide more in-depth policy research.

ECOWAS exports show little product diversity, with a heavy reliance on extractive products (e.g. petroleum, natural gas) and a few agricultural commodities (e.g. cocoa, rubber, cotton). Official ECOWAS food exports represent only 10% of total exports, and almost 60% of this 10% is represented by cocoa. ECOWAS imports are more diversified, with a high share of industrialised products (e.g. refined petroleum, vehicles, ships, telecommunications equipment) and food products (e.g. rice, wheat). Hence, ECOWAS main trading partners are highly industrialised countries such as China, India, USA, EU countries and Brazil, which mainly buy raw materials and sell industrialised products from/to the region.

Trade figures differ considerably between West African countries. Nigeria accounts for 73,5% of total registered ECOWAS exports, primarily as a result of its petroleum exports but also due to its larger economy. The country also dominates total ECOWAS imports (52%) as well as food imports specifically (51%). The second and third economy of the region, i.e. Ghana and Côte d’Ivoire, are the main ECOWAS food exporters, largely due to cocoa, followed by Nigeria.

West Africa has a positive (overall and agricultural) trade balance, but it faces a negative food trade balance, which has been deteriorating rapidly over the last decade. Export earnings have given the region the resources to finance a growing share of imported food products (in order of importance, according to official UNCTAD statistics: rice, wheat, processed food, fish, sugar, milk products, vegetable fats and oils, tobacco, meat and vegetables). This has created a paradoxical situation where a region with an exceptional potential for food production is importing more and more food items. This trend can be mainly explained by the increasing purchasing power of several countries in the region as a result of commodity booms, a fast growing population that needs to be fed and changing consumption patterns following a strong urbanization movement and growing middle class. This increased and changing food demand is not met by sufficient and adequate local food supply. Even if production of main food staples has increased, it hasn’t matched the faster growth in demand. This increasing food import dependency is one of the major concerns of regional and national policymakers in ECOWAS.

Food production remains constrained by issues such as poor access to key inputs, lack of secure land rights, water access limitations under erratic weather and poor development of irrigation, weak production technologies, fragmentation of smallholder producers, limited credit, and technical constraints in processing. Market access obstacles faced by West African producers and processors further hampers their competitiveness, while some imported food may flow more easily through corridors to reach main West African markets, moved by powerful importers/trading corporations. Indeed, these issues face complex challenges that relate to finance and capacity, but also political interests and incentives of the actors involved, particularly those with economic or political power.

Intra-regional trade in ECOWAS represents 8 to 13% of total ECOWAS trade according to official data, but it is estimated that approximately 75% of intra-regional trade is not accounted for in official statistics, as it takes place on an informal basis. Evidence further suggests that intra-regional trade has considerable room to grow further. This fits the ambitions of the region to step up intra-regional trade and value chain development (through increased production and value addition), with particular emphasis on agricultural and food products, for poverty reduction and food security.

Nevertheless, the quality of trade data poses serious challenges for designing and implementing effective policies. Due to the informality of trade, official statistics hide many important features of the real trade patterns and dynamics in the region, which deserve to be taken into account. Official data not only give a distorted picture on the size of intra-regional trade, but also on its composition. Informal intraregional trade is dominated by staple foods, in particular livestock, maize, millet and sorghum, while official intra-regional trade statistics feature crude and refined petroleum, as well as cement and other construction materials in the top-three of intra-regionally traded goods. Furthermore, women are over-represented in informal trade, compared to formal trade. While ad-hoc surveys and case studies covering informal trade provide useful insights, comparison and compilation of their results is complicated by the fact that different studies try to assess the magnitude and nature of undocumented intra-regional trade in the region, for different groups of countries and commodities. More comprehensive information on informal trade, and its drivers, is required for effective policy-making.

It is impossible to get a comprehensive overview of spatial dimensions of intra-regional trade from existing statistics and literature, not least because of its informality, but a limited set of studies indicate that part of intra-regional trade flows through main regional corridors. This main West African transport network (i.e. the West-East Trans-Sahelian Highway between Dakar and Ndjamena and the Trans-Coastal highway between Dakar and Lagos, and the interconnecting North-South corridors) serves extra-regional, intraregional and national trade. The good functioning of these corridors is therefore of great importance.

However, studies also indicate that considerable intra-regional trade flows outside these main regional corridors. This applies to trade that occurs around border areas, where national borders separate producers and the nearby markets they serve. Furthermore, production basins of intra-regionally traded goods are not always in the direct vicinity of a corridor, as these were conceived to connect port cities with the hinterland (and not production basins with cities/markets). Therefore, policies and programmes seeking to support intra-regional trade and food value chain development will need to take that broader perspective into account, in order to achieve objectives related to poverty reduction, food security and inclusive development. This implies improvement of strategic secondary roads and market infrastructure in rural areas.

To explain the above dynamics of intra-regional trade in West Africa, particularly for agricultural and food products, this paper provided insights into actors and factors that drive these dynamics. Such political economy factors will need to be taken into account when designing and implementing policies to effectively promote intra-regional trade and value chain development. Trade differs considerably depending on the value chain concerned, with regard to the patterns and size of flows, the actors involved and their incentives, the potential impact of policy change and/or formalization of the value chain for different value chain actors, among other factors. Therefore, deeper understanding of strategic/relevant value chain dynamics would be important to further inform policy dialogues and guide effective interventions.

To contribute to this, ECDPM, together with its partners, will conduct further value-chain specific analytical work and facilitate multi-stakeholder policy dialogue, with due attention for political economy factors and particular focus on rice, livestock and horticulture. Amongst other things, this will be key to understand the key actors and factors and their potential role in driving or undermining regional efforts to turn ‘transit corridors’ into ‘transformation and development corridors’. Given that this study has pointed out that regional infrastructure corridors currently only connect ports with the hinterland, mostly serving imports into West African (and exports of few agricultural commodities), how can connections with the food production basins be improved to strengthen intra-regional food trade? Given the need and ambition in the region to enhance processing, how can this be promoted through corridors? Given the importance of informal trade, how can corridor initiatives promote gradual formalisation, to the benefit of vulnerable value chain actors, in particular those operating currently in the informal sector?

Political economy analysis and facilitation of frank policy dialogue are needed to answer these questions and move forward these important debates. ECDPM is keen to continue working with West African and international partners, to provide further insights and contribute to coherence and coordination across trade, agriculture, infrastructure and value-chain initiatives to promote sustainable and inclusive development.