External Trade Pessimism and the Role of Regional Markets in the Groundnut Trade by AGC Countries

Traditional agricultural exports in many African countries have experienced serious difficulties over the last two decades. A long[1]term decline in external demand and other factors related to international markets are the most commonly cited reasons for these difficulties. The ongoing debate on regional economic co-operation seems to suggest the hope that regional markets could, at least in part, act as a substitute for international markets. Using the example of groundnuts, the present paper investigates the role of domestic and external factors in the decline of traditional exports, and the role regional markets could play in their future development. Its findings indicate that African groundnut exports have suffered more from domestic policies than from external demand factors. The findings also reveal that African exporters rarely exported to regional markets, even though demand for vegetable oils grew at a rate two and half times higher than in global markets. Based on th