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Cape Verde and Mozambique as Development Successes in West and Southern Africa

Cape Verde and Mozambique as Development Successes in West and Southern Africa

Chapter:
(p.203) 7 Cape Verde and Mozambique as Development Successes in West and Southern Africa
Source:
African Successes, Volume IV
Author(s):
Jorge Braga de MacedoLuís Brites Pereira
Publisher:
University of Chicago Press
DOI:10.7208/chicago/9780226315690.003.0009

We study how globalization and governance (G&G) interact with convergence given Cape Verde and Mozambique’s particular geographical and historical contexts. We identify macro-level policy and institutional combinations underpinning successful trade diversification (an indicator of globalization) and income convergence (an indicator of governance) in the sub-regions of West and Southern Africa. We assess the extent to which these combinations apply to both countries using an empirical analysis and find that trade openness drives convergence and export diversification in Western Africa (which is becoming more diversified) while convergence is instead driven by economic and political freedoms in Southern Africa (which is becoming more specialized). Our empirical analysis is complemented by a case-study narrative of Cape Verde and Mozambique’s long-term development, which allows us to also identify several common drivers. Moreover, both countries reveal convergence compared to their sub-regional peers when looking at average GDP per capita and indicators of financial reputation and good governance. While these findings are insufficient to conclude that convergence will be sustained, the positive interaction between trade and financial globalization, on the one hand, and good governance and democracy, on the other, may help explain the observed diversity of the Portuguese-speaking African community.

Keywords:   export diversification, convergence, governance, Africa, Cape Verde, Mozambique, Portuguese-speaking African Countries, PALOP

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