Econ coursework

Commentary on No silver bullet

In the article taken from The economist print edition, 16th January 2003, America¡¦s trade representative, Robert Zoellick, has ¡§brought a sunny message¡¨ in Africa. This is because there is a rapid increase of African exports to America due to ¡§tariff free access¡¨.


Figure 1
Figure 1 shows the situation where the effect of free trade of demand African exports in America. The price of African exports is shown in P2. The price is lower than the domestic supply goods in America. As the result, the supply curve of African exports (S2), cuts the demand curve at A. This has benefited both consumers by lowering the price and increasing quantity consumed in America.

The SACU agreement (Southern African Custom Union) is believed will bring p...