North African countries' production and export structure: towards a diversification and export sophistication strategy

The North African countries' (NACs) production and export structure suffers from double constraints: insufficient diversification and weak sophistication. This study assesses the impact of diversification/sophistication variables on growth in the NACs and verifies that the current export structure is indeed a constraint to economic development. We estimate a growth model as a Barro's regression (conditional-convergence model) using panel data. The factors that determine export diversification and sophistication suggest which levers and actions would firstly allow NACs to diversify their exports to higher added-value products and secondly take the existing products to a higher level of sophistication. Our recommendations highlight the role of various policies and stakeholders.