UN agency's annual report shows mixed bag in African trade

The United Nations Conference on Trade and Development, UNCTAD, has released its annual report, which this year looks at issues concerning the export of African raw materials to developed countries.

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Raw materials make up more than half of exports from Africa.

Across the continent, there is a small, yet growing manufacturing sector, but most countries export their manufactured goods to neighbouring countries, not to the West. In fact, intraregional trade has increased up to 20 percent of exports.

So with the continent sending away its riches to the West instead of using them to create their own products, anything from refined oil to chocolate bars, African countries too often lose out.

Alfredo Calcagno, the head of UNCTAD's develoment polices on globalization, says African countries that wish to industrialize need to develop their manufacturing sector.

"What you export depends very much on where you export," said Calcagno. "In fact, what you tend to have in Africa, but also in South America, is that most manufactures [processed commodities] you sell to your neighbours, or to your region as a whole."

He says manufacturing in Africa, outside of South Africa, has not progressed beyond 15 percent of global value added, and that this is important because manufacturing is key for productivity and it generates growth in others linked sectors, such as agriculture and services.

Ultimately the UNCTAD report indicates that there are not enough manufacturers on the continent, and that is exactly what needs to be encouraged.