Berden et al. (2009), Fontagné et al. (2013) and Egger et al. (2015) propose three different methodologies, but these have not been implemented at a broad scale. Whether our results are biased upward or downward due to the presence of NTBs depends on whether tariff cuts are positively or negatively correlated with changes in tariffs. Both directions are possible. The unilateral nature of the liberalization suggests that Western governments could have reduced all type of trade barriers. However, Brandt et al. (2018) have shown that the Chinese government imposed new NTBs in several sectors after it lowered import tariffs.

The relevance of NTBs has been demonstrated by several studies that show they play an important role in shaping the effectiveness of trade agreements (UNCTAD, 2018). Moreover, their existence does not only directly affect trade flows, but also other outcomes. For instance, Caliendo and Parro (2015) argue that the welfare effects they obtain in their study would have been a lot higher, if they had been able to take reductions of non-tariff barriers into account.

# **7.2 Potential for future export growth**

According to Martin and Ng (2004), the weighted average tariff faced by developing countries declined from 30% in 1983 to 11% in 2003, and the majority of this reduction was due to unilateral agreements. The two trade liberalization initiatives that we exploited – the EU’s GSP system (including the special versions, GSP+ and EBA) and the US’ AGOA – have lowered the tariffs that African countries face in these markets to even lower levels. However, there is still scope for further tariff reductions, also on the tariffs that developing countries charge themselves. Caliendo et al. (2015) find striking results from their counterfactual experiment where they move to a world with zero tariffs for all countries, and in particular they show that most of the extra gains of free trade are for emerging economies.

The comparison of textile exports from sub-Saharan Africa to those from South Asia and China Figure 4 highlighted the current low exports from Africa, which in turn suggests a large potential for future export growth given the evolution of global demand for textile and apparel products. The extremely low share of textile exports from sub-Saharan Africa imply that its growth potential is definitely not constrained from the demand side. The annual increase in global trade in textiles is several times higher than the total annual exports of the region.

In Figure 6 we show separately the evolution of exports for the five product categories in the entire textile supply chain. The sub-Saharan African region has the highest global market share in agricultural inputs (e.g. wool, cotton, silk, etc.), which is shown on the axis on the right. Its share of global trade fluctuated between 3% and 4.5% in this segment. The trend growth rate is positive, but almost imperceptibly small.

Its global market share is always below 1.5% for the other four categories, which are shown on the left axis. The share in 2016 does not exceed the share in 1995 for any of these product categories and in several cases it went down substantially. Clearly, lack of import demand will not constrain African export growth for any of these product segments.

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