Diagnostic Trade Integration Study Update for the Gambia: Harnessing Trade for Growth and Employment1
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The Gambia DTISU i April 20, 2013 Diagnostic Trade Integration Study Update for The Gambia: Harnessing Trade for Growth and Employment1 1 The opinions expressed in this report are those of the authors and do not necessarily reflect the views of UNCTAD or of the organizations and institutions with which the author may be connected. The document is reproduced in the form and language in which it has been received. The designations and terminology employed and the presentation of material in this report do not imply the expression of any opinion whatsoever on the part of the United Nations concerning the legal status of any country, territory, city or area or of the authorities or of its frontiers or boundaries. The Gambia DTISU ii ACRONYMS USED IN THIS DTIS AGOA African Growth and Opportunity Act ANR Agriculture and Natural Resources BIA Banjul International Airport BDS Business Development Services CBG Central Bank of The Gambia CPCU Central Projects Coordinating Unit CSO Civil Society Organisation EBA Everything But Arms ECOWAS Economic Community of West African States EPAs Economic Partner Agreements ERP Economic Recovery Programme FSQA Food Safety and Quality Authority GATT General Agreement on Tariffs and Trade GBoS Gambia Bureau of Statistics GCCI Gambia Chamber of Commerce & Industry GCDB Gambia Commercial and Development Bank GDP Gross Domestic Product GIEPA Gambia Investment and Export Promotion Agency GIPFZA Gambia Investment Promotion and Free Zones Agency GNI Gross National Income GNTCA Gambia National Transport Control Association GOTG Government of The Gambia GPA Gambia Ports Authority GRA Gambia Revenue Authority GTBoard Gambia Tourism Board GTA Gambia Tourism Authority GTTI Gambia Technical Training Institute HIPC Heavily Indebted Poor Country IBAS Indigenous Business Advisory Services ICT Information, Communication & Technology ISRT Inter State Road Transit ITC International Trade Centre LDC Least Developed Country LLDC Land Locked Least Developed Country MDG Millennium Development Goal MDRI Multilateral Debt Relief Initiative MFPC Micro Finance Promotion Centre MFI Microfinance Institution MIS Management Information Systems MOFEA Ministry of Finance & Economic Affairs The Gambia DTISU iii MOFWR Ministry of Fisheries and Water Resources MOTIE Ministry of Trade, Industry, Regional Integration, and Employment NADA National Agricultural Development Agency NBFI Non-Banking Financial Institution NEDC National Enterprise Development Centre NEAP National Employment Action Plan NEP National Employment Policy NGO Non-Governmental Organisation NRA National Roads Authority NTA National Training Authority ODA Official Development Assistance PAGE Programme for Accelerated Growth and Employment PRSP II Poverty Reduction Strategy Paper II SBAs Small Business Associations SDF Social Development Fund UEMOA Union Economique et Monétaire Ouest Africaine WTO World Trade Organization The Gambia DTISU i Table of Contents Preface 1 Executive Summary 2 Action Matrix 9 Section I: Developments in The Gambia since the Original DTIS 41 A. From the Original to the Revised DTIS 41 B. Economic Developments since the Previous DTIS 42 B.1: The Gambia’s LDC Status and Macroeconomic Developments 42 B.2: Trade and the Current Account 44 B.3: Debt and Foreign Assistance 46 C. Economic Reforms since the Previous DTIS 49 Section II: Improving Trade Policymaking in the Gambia, Promoting Better Coordination with Other Ministries And Focusing on Trade Negotiations 52 A. The Mainstreaming of Trade and National Development Strategies 52 B. Improving the Consultative and Policymaking Process 53 B.1: Coordination between Government Agencies 53 B.2: The Gambia Revenue Authority 56 B.3: The Gambia Standards Bureau 57 B.4: The Gambia Competition Commission 58 B.5: Potential for Public-Private Partnerships: Laboratories and Credit Bureaus 59 C. Improvements in the Collection and Dissemination of Economic Data 60 D. Horizontal Issues in Trade, Investment, and Development 67 D.1: The Attractiveness of The Gambia to Prospective Foreign Investors 67 D.2: Horizontal Impediments 72 D.2.i: Horizontal Impediment #1: The Tax System 72 D.2.ii: Horizontal Impediment #2: Electricity 79 D.2.iii: Horizontal Impediment #3: Credit 81 D.3: Horizontal Incentives 83 D.3.i: Horizontal Incentive #1: Preferences and their Utilization 83 D.4.ii: Horizontal Incentive #2: Investment Promotion 86 The Gambia DTISU ii Section III: Exploiting the Trading Opportunities Arising from Trade Agreements and Market Access 89 A. The Place of Trade Policy in Economic Reform and Development 89 B. The Gambia’s Tariffs 91 C. Relations with Specific Partners 94 C.1: Relations with Senegal 94 C.2: Negotiations in ECOWAS and Other Regional Fora 96 C.3: Economic Partnership Agreement Negotiations with the European Union 97 C.4: Relations with Non-Traditional Partners 101 D. New Initiatives in Trade Policymaking 101 D.1: The Issue of an Antidumping Law 101 D.2: Establishing a Permanent Mission of The Gambia in Geneva 102 Section IV: Production and Trade in the Agricultural Sector 104 A. Introduction 104 B. The Government’s Agriculture Strategy 105 C. Horizontal Need for Quality Standards, Inspection, and Laboratories 106 C.1: Food Safety Policy 106 C.2: Food Safety and Trade 107 C.3: Capacity-Building and Technical Assistance 108 D. Crops 110 D.1: Groundnuts, Cashews, and Sesame 110 D.2: Poultry and Livestock 112 D.3: Horticulture 114 E. Recommendations 116 Section V: Trade Policymaking in Fisheries and Aquaculture 118 A. Fisheries 118 A.1: Fishery Resources in The Gambia 118 A.2: The Industrial Fisheries Sector 119 A.3: Export of Fish and Fish Products 120 A.4: Challenges that the Sector Faces 120 A.4.i: Lack of Adequate Supply 122 The Gambia DTISU iii A.4.ii: Costs and Availability of Electricity 123 A.4.iii: Reliance on Imports 123 A.4.iv: Taxes 123 A.4.v: Compliance with Sanitary and Phytosanitary Requirements 124 A.5: Key Elements of the Policy Environment 125 B. Aquaculture 127 B.1: Shrimp Farming 127 B.2: Oyster Culture 129 C. Conclusions and Recommendations 129 C.1: Address Structural Obstacles 130 C.2: Improving Capacity 130 C.3: Address Sustainability Issues (Over-Exploitation of Demersal Stocks) 131 C.4: Enhance Infrastructure 131 C.5: Explore Niche Markets for High-Value Products 132 Section VI: Programmes to Improve Opportunities for Women: The Fisheries Sector 133 A. Introduction 133 B. Opportunities for Women in the Sector 133 B.1: Fresh Fish Marketing and Distribution 133 B.2: Cured Fish Distribution and Marketing 134 B.3: The Diaspora Trade 135 C. Constraints of Women in Fish Processing Factories 135 C.1: Factory Conditions 135 C.2: Access to Credit by Artisanal Women 136 D. Recommendations on Gender-Specific Issues and Constraints 136 Section VII: Trade Policymaking on Trade in Services and the Business Environment for Trade and Investment: Building Supply Capacity in Priority Sectors 140 A. The Negotiation of Commitments on Trade in Services 140 A.1: Introduction 140 A.2: The Gambia’s Commitments in the General Agreement on Trade in Services 141 A.3: Approaches that The Gambia May Take towards New Commitments 143 B. Business Environment for Trade and Investment and Entrepreneurship Policy Issues in The Gambia 144 B.1: Investment 145 The Gambia DTISU iv B.2: Entrepreneurship Policy 152 C. Transportation Services 159 C.1: Maritime Transportation 160 C.2: Land Transportation 164 C.3: Air Transportation 172 D. Tourism 173 E. Telecommunications 175 Boxes Box I.1: The Gambia’s Status as a Least Developed Country 43 Box II.1: Excerpt from the National Policy on Micro-Small and Medium Enterprises 54 Box II.2: Excerpts from the Draft National Export Strategy 55 Box II.3: The Merchandise Export Data Problem 61 Box II.3: Priority Sectors for Investment Identified in Schedule I of The Gambia Investment and Export Promotion Agency Act, 2010 88 Box III.1: The Relationship between Trade Negotiations and Domestic Reforms 90 Box III.2: The ECOWAS Trade Liberalization Scheme 98 Box V.1: Policy Objectives and Policies of the 2012-2016 Fisheries Strategic Action Plan 126 Box VII.1: Investment Incentives, Benefits and Guarantees 150 Figures Figure I.1: Relative Value of Trade to the Economy of The Gambia 44 Figure I.2: Exchange Rate Fluctuations, 2000-2011 45 Figure I.3: Receipts of Workers’ Remittances and Compensation of Employees in The Gambia 46 Figure I.4: Effective Applied Tariffs of The Gambia, Mali, and Senegal, 2009 51 Figure II.1: Inflows of Foreign Direct Investment to The Gambia, 1990-2010 68 Figure II.2: Total Tax Rates of ECOWAS Countries, 2007 and 2011 74 Figure V.2: Industrial and Artisanal Fish Production in MT (1997-2010) 121 Figure V.3: Exports of Fish and Fishery Products (1997-2010) 121 Figure VII.1: Liner Shipping Connectivity Index for ECOWAS Countries, 2004-2011 162 The Gambia DTISU v Tables Table I.1: Real GDP Growth Rates, 2000-11 and Forecasts 42 Table I.2: Debt-Related Indicators for The Gambia, Senegal, and WAEMU 47 Table I.3: Composition of Official Development Assistance to The Gambia, 2002 and 2010 48 Table I.4: Gross Disbursement of Official Development Assistance to The Gambia, Senegal, and WAEMU 48 Table I.5: Trade-Related Laws Enacted, Amended, or Repealed since the Last DTIS 50 Table II.1: Rankings of The Gambia and Other African Countries on the World Bank’s Doing Business Index, 2012 69 Table II.2: Rankings of The Gambia and Other West African Countries According to Selected Indices of Economic Policies, Performance, and Related Factors 70 Table II.3: Rankings