Cross-Border Trade and the Parallel Currency Market-Trade and Finance in the Context of Structural Adjustment: A Case Study from Kano, Nigeria

A "new regionalism" seems to be gathering pace in West Africa, underpinned by the growing activities of informal cross-border traders. These traders appear to be succeeding through their operations in effecting an extensive, de facto market integration in West Africa, a development which many commentators have contrasted to the sub-region have been pursuing for some time now. This report, based on a study of one of the most important parallel currency markets in West Africa, argues, however, that some of the assumptions and conclusions of those who have studied the "new regionalism", including the World Bank, are questionable. Of particular interest is the suggestion that the expansion that has taken place in informal cross-border trade is a vindication of the market-liberalising thrust of structural adjustment and that adjustment policies have, in an organic manner, improved the effectiveness of an "independent" bourgeoisie that is allegedly emerging out of this trade as an agent of regional integration. The authors challenge these and other related assumptions and claims and, in so doing, make the case for the adoption of what they call a "development approach" for tapping the benefits of the informal currency markets. They posit this approach as an alternative to the "market coercion" that inheres in structural adjustment.