Can Export Promotion Agencies Stem the Deindustrialisation in Sub-Saharan Africa?
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We investigate how Export Promotion Agencies (EPAs) affect manufacturing outcomes in Sub-Saharan Africa (SSA). Synthetic control methods technique results in employing the cases of South Africa and Mauritius to illustrate the effect. Results indicate an EPA’s adoption drives up manufacturing outcomes significantly. SSA countries without an EPA might have missed out on an opportunity to boost their manufacturing sector. Particularly, manufacturing value added as a share of GDP is about 7.5 and 3 percentage points higher in South Africa and in Mauritius compared to their synthetic counterpart. Jointly adopting EPA and EPZ can be beneficial to manufacturing activities. Since many conditions required for well-functioning financial markets for manufacturing firms to finance their expansion are missing, government intervention through EPA directed at counteracting some distortions may be growth enhancing.
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