Are Jordan and Tunisia's exports becoming more technologically sophisticated? analysis using highly disaggregated export databases

Abstract EN

There is a growing consensus that “what countries export matters for growth” (Haussmann and al.

(2007) and Krishna and Maloney (2011).

Thus, the evolution of countries’ export baskets can provide useful clues as to how the underpinnings of long-term growth are changing overtime.

Using two highly disaggregated export time series (products captured at the 11-digit level) this paper examines how Jordan and Tunisia’s production and export structures have changed over the last decade, in terms of technological content.

We find that Jordan and Tunisia have experienced contrasting dynamics over the last decade.

Thanks to its large exports of pharmaceutical products, Jordan enjoys a much higher share of high tech products in its export basket (11.5 percent versus 5.4 percent respectively) but this share has been declining overtime due to the rapid rise of low-tech exports, in particular textiles products.

In contrast, from a very low basis, Tunisia has been slowly but steadily climbing the technological ladder, thanks to a rise in medium-high tech products (electronics and mechanical components) and a corresponding decline in the preeminence of exports of textile products.

Given both countries’ strong human capital base, further increase in medium-tech exports is likely to boost growth and reduce the unemployment of highly educated individuals.

Analysis of the factors behind the few success stories in both countries underscores the importance of overcoming institutional weaknesses and establishing transparent and rules-based Government-business relationships as a pre-requisite for successful global integration in developing countries.