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Exports from African LDCs to emerging and developing countrieshave considerably increased over the period. African LDCs have alsoincreased their exports to other African countries, more than exportsto European Union. Intra-Africa exports of African LDCs increasedfive-fold between 2001 and 2008; while to the EU they went upthree-fold, pointing to important complementarities among Africannations which can be exploited in the context of regional integration.African LDCs trade with developed countries is dominated by exportsto the United States which increased six-fold over the periodunder review, largely due to the African Growth and Opportunity Act(AGOA).It should be noted nevertheless that LDCs are yet to realise the fullpotential of trade as a pillar of development. LDCs have not reapedtrade opportunities in fully mainly due to their export composition.Most of their traded goods are in the lower end of the value chainand they are exported either as raw materials or with very limitedvalue addition.This vulnerability was made clear during the economic crisis whenthe trade channel turned out to be one of the main channels throughwhich African economies were negatively affected.This points to the fact that diversification is critical for sustainabledevelopmentLDCs in Africa have not been able to build diversified economieswhere manufacturing and services make a substantial contributionto economic activity. These sectors are critical for the good managementof natural resources and raising growth rates.In this regard, Africa’s Industrial Development Agenda has indicatedagro-industry, pharmaceutical and infrastructure sectors as key inpromoting and catalyzing value addition and structural transformationin the continent.It therefore goes without saying that domestic policies matter asmuch as international trade policiesHistory shows that no country has been able to develop without diversifyingits economy and utilising trading opportunities to the full-122 Part Two