 Thank you. Everybody are the discussants for the comments. I don't have much to respond to. I think all of the points that you made are excellent. I particularly like the point about thinking about the natural resource sector as being kind of an upstream sector that can feed into a more complex manufacturing base and that's something I'm going to definitely give some thought to in the times to come. What I'll do is I'll hand over a problem, maybe first to John to respond to some of the comments and then you can respond. Thank you for the comments. Very useful. I will make a lot of the questions you had, points taken and I would say that it's something that we need to look deeper into. I will just take a couple of them. There's no doubt about that this issue of distinguishing between intermediates and final goods production, what the M&E's are doing in Asia versus in Africa is something that we are currently studying more intensively. There is clearly a tendency in the data that we have focused on that the M&E's produce more intermediates for local markets in Asia than in Africa but it's not entirely clear what is the higher value added part of the production. There's something that is puzzling us a little bit that there is a lot of variation in the value added gain of engaging in different types of production in Africa whereas in Asia it's very clear that both the learning effects differ in terms of whether you produce intermediates or final goods products. In Africa we see a large variation across countries whether they do one or the other. The point is taken, the reason why we may not have highlighted it more is because we are still looking into this issue and hopefully we can give you a more solid answer in a year or two on that. About the contractual arrangements, I've been doing some work also with Carol and Nita Trivkovic and others on these matters of contracting arrangements mostly in Vietnam I have to say and these local content elements. There's no doubt about that it reduces from the point of view of the M&E's having a contractual arrangement also in terms of technology transfer. In order to get some of the contracts they need to sign the contracts of technology transfers in Africa more than they do in Asia. That is one thing that is clear from some of the work we did in Ghana and compared to Vietnam. Second of all we also see that a lot of the M&E's they actually required this themselves in order to reduce risk in terms of committing the local producers to the engagement. They are more inclined to demand this kind of contract with local producers in this case Ghana as compared to Vietnam where most of the M&E's going into Vietnam do not have a demand of contractual arrangements when they enter. They will actually find the most efficient producers after they enter Vietnam whereas they will not even establish the foreign affiliate in Ghana before they have this contractual arrangement settled before entering. So this is something that there is a clear difference witness in this case and we need to figure out why that is and most of the M&E's we have been talking to are saying that they see Ghana as a much more risky investment than they experienced in Cambodia or Vietnam even within the same sectors. Even in sectors for example, rubber where Ghana is doing quite well internationally we still see that they have a comparative advantage as compared to Vietnam but we still see the M&E's demanding these contractual arrangements more frequently in Ghana than in Vietnam before entering. I guess it's something to do with perceived risk that we may need to reduce. Thank you very much for your question. Actually in this presentation I tried to focus more on the main agglomeration mechanisms at work notably input sharing which increases efficiency of firms when they locate near their input suppliers, labour market pooling and knowledge spillovers. But as for incentives given by the government to push firms to concentrate in a given region we can see this in service industries, I will come to this later but we also can see that indirectly in the concentration of agro food firms especially in the case of the governorate of SFACS whereas I mentioned in slides that given the high financial capacities of its investors SFACS investors could benefit or exploit economic policies which provide subsidies to encourage the cattle farming sector in which SFACS is largely specialised despite the fact SFACS has no natural cost advantages it has very poor grazing land to be specialised in this manufacturing sector but so far to my knowledge the capital of Tunisia, Tunis, the administrative capital there are incentives given by the government to impulse specialisation in service industries in Tunisia and to push in some way firms to relocate especially manufacturing firms to relocate from the capital Tunis because Tunis as you know it's the first central business district it is a large town and this economy is quite common to this kind of towns traduced by shortage of industrial sites, the high costs, high land and housing prices and so the government now tries to impulse specialisation in high added value manufacturing industries such as electric and electronic industries in their way to do this I hope that I answered your question Just to also maybe add on the kind of insist question about agglomeration in government policy we did do quite a large body of work on that I've done some work with John Page, we've produced a paper on them also with Abel who's here somewhere too and it's very variable in terms of how effective government policies are in terms of establishing special economic zones they play a role but what we uncovered in many cases is just really ineffective government policies and the need for much more coherence and transparency in how these zones are set up in comparison with Vietnam where it seems to work quite effectively in terms of offering incentives for firms to establish special economic zones they're very effective in attracting FDI and in sustaining levels of FDI in those zones so it's very variable and I think that there is more research needed into exactly how effective these government policies are in terms of the transparency and so on Thank you very much My name is Peter Quote from Investor Organa I think I have enjoyed all the presentations I just have a quick comment to make on FDI and technology transfer Most often we find technology transfer or FDI moving into the extractive industries mining oil so it will be interesting if you could disaggregate your results if you could take out a destructive are we going to see different results? I think we should look into that then also if you take countries like South Africa, Nigeria I mean these are the major countries that attract FDI perhaps if you could take them out what pattern are we going to observe? Thank you very much I think this has been a really excellent discussion I just want to pick up on the point that I think John you made around the FDI and the challenges of sort of enclave development I think certainly what you're seeing in Southern Africa particularly there has been a big drive around local content legislation but it's been very rough so typically they'll slap on a 30 or 40% local content provision it might be an oil and gas or mining or whatever but it's not being enforced there's not the institutional or government capability to enforce it and there aren't the companies there that can really get there but I think this is a big trend that's going to continue so certainly we've done some work or commissioned work around the role of supermarkets, South African supermarkets in the region and these probably provide quite low hanging areas of opportunity for local suppliers to build up capabilities to get in but I think it really brings in the area an important focus needs to be around the capacity of government to manage this and perhaps understanding the types of policies that can be put in place to really encourage this a lot further and I think it is a huge challenge at the moment how this is going to be done and then I think perhaps looking at how one then moves to building up local capability that can then move into an export type some of these firms as they expand and hopefully fill this gap of the missing middle and can then hopefully move into more of an export type role so I think this is a really critical area of work that needs to probably a lot more investigation as to what the policy tools are that can be employed to do this but at the moment I think it's too rough to blunt there isn't the capability there and it's certainly not working well so I think it's a very rich area but perhaps some comments on that I had one question which is based on the presentation by Carol I haven't read the paper so maybe it's in the full paper but somewhere you mentioned that a large determining factor of success of industries in Africa exporting was the born global do I understand with that that it is industries which are owned by the diaspora by Indian, Greek, Lebanese etc. or is there another definition of that if the first assumption is right what are the policies to emphasize of the born non-global industries thank you Peter's comment on we haven't looked into we started out by looking at manufacturing sector just to limit our scope a little bit there's no doubt about that it would be nice to expand the analysis to the extractive industries and look a little bit deeper into how the linkages are to the local economy I think some of our work in South Africa currently is going to look deeper into this and there's no doubt about Nigeria I have some PhD students who have tried utilizing the data but the data quality has not been good enough actually to facilitate the type of analysis that we carry out in this in terms of the challenges of the enclave economies there's no doubt about this with the lack of enforcement of the local content I currently have a PhD student looking into this in the extractive industries actually and basically they are on purpose violating laws and just paying the fines and it doesn't really matter for the next contract that they bid for most of the times there is a government involvement also in the bid by these extractive industries and the companies so there's clearly something about the capacity of government but also that government may be too involved in some of these extractive industries to actually facilitate enforcing this local content element it's a big discussion about privatization of extractive industries there's no doubt about that more enforcement is needed on this local content element also in terms of creating jobs for local people I had quite a... George is also sitting here a study in Ghana where we looked into whether they live up to the local content elements in the Taguari area and basically we had to stop the study more or less because we concluded that everything that was in the report was not reflecting the truth in the field so that was very much right but it was basically government created data that was providing the evidence for living up to the local content and that was not really in accordance with the data we collected from local firms and the M&E's so there is clearly this issue of government enforcement and government capacity with guarding the supermarkets that's interesting as far as I know you may correct me that the effect of supermarkets on the local value chain from domestic producers it hasn't been the success that we expected it's still a lot of imported goods it's a lot of joint ventures where there is a big M&E lying behind most of the production as far as I'm informed but clearly it will eventually increase the possibility of local producers in engaging in this interaction along this value chain and maybe reap the benefits so I agree on that this was one particular example of that was what we found in Mozambique this was work that John and I did as well and it was local domestic firms I don't know if we ever did the disaggregation by the export or not I'm not sure if we could see that I don't think the data allowed us to see that so we're not sure but they would have been classed as domestic firms that established and the minute they established they were exporting and in terms of the policy implication of that then one of the things I kind of mentioned in the presentation was that there is a clear problem accessing markets accessing export markets so the knowledge of the markets of where you're going to export to appears to be a bit constrained for local firms in terms of entering into those markets and also trade logistics actually accessing getting the material that are getting the goods to the port for example that's another very significant constraint for some of the domestic firms so in terms of the policy I think it's quite obvious in terms of selection into exporting it's those kinds of constraints but also capabilities themselves and I think a lot of what we talk about comes down to the domestic capabilities and what kind of policies can we look at there in terms of building up those capabilities to be able to enter into export markets there's a lot of work to be done domestically first