Imani colleague, Cyril Prinsloo, recently collaborated with Ron Sandrey from the Trade Law Centre (tralac) on an article investigating “black holes” in trade data, with a key focus on intra-African trade. A black hole is defined in Wikipedia as a mathematically defined region of space-time exhibiting such a strong gravitational pull that no particle or electromagnetic radiation can escape from it. At times African trade data seems to exhibit these same characteristics. This is because attempts to reconcile data between bilateral partners can result in interesting situations where some of this data seems to have plunged into one of these black holes. This is an important issue as politicians, trade officials and practitioners rely upon accurate data for sound policy-making outcomes.

Collating and analysing African trade data is an exercise fraught with difficulties. In many instances this data is not available from its primary source, and this leads to the use of so-called mirror data or data assessed by examining the mirror of the trade partner data. While this is a very good proxy, it does lend itself to some interpretational problems (such as when neither partner reports). In addition, there are many other issues that one encounters such as transshipment of goods across boundaries, data classification differences, whether or not the costs of transport and associated costs are included in the import values, and the sensitivities associated with some goods that lead to a country not reporting the full picture (South African gold trade, for example). These difficulties persist despite organisations, such as the International Trade Centre (ITC), making great strides in improving data availability and accuracy.

Overall, African trade data now reconciles relatively well at the big-picture level of aggregate country reporting when either direct or mirror data is used. Nevertheless, some glaring gaps remain. This applies especially to the commodity analysis, and further investigation shows that these two aspects of intra-country and commodity problems are often interrelated. However, the situation is improving, and examples of this include the reporting by South Africa of its intra-Southern African Customs Union (SACU) trade data since 2010.

This article originally appeared on the tralac website. The full paper can be downloaded here, or from the tralac website