Revision Video: Primary Product Dependency

• The prices of these goods can be volatile on world markets
• When prices fall, an economy will see a sharp reduction in export incomes, an adverse movement in their terms of trade, risks of a higher trade deficit and a danger that a nation will not be able to finance state-led investment in education, healthcare and core infrastructure
• Despite being rich in natural resources, for many countries this is a curse rather than a blessing

Here are some examples of export dependence for a selection of countries in Sub-Saharan Africa: The data shows the % of total exports in 2010:

• Angola: 97% oil
• Ghana: 39% gold, 26% oil, 17% cocoa
• Kenya: 19% tea, 12% horticulture
• Senegal: 11% fish, 11% phosphate
• Zambia: 84% copper

Sub-Saharan Africa (SSA) is often cited as a region where primary sector dependence is high. SSA's share in global manufacturing trade remains extremely low.

This chart from the Economist (published in December 2014) illustrates clearly the countries that are most heavily dependent on primary commodities either as a net exporter or a net importer:

http://www.economist.com/blogs/graphicdetail/2014/...