Logistics Integration via the Cairo-Cape Town Corridor: Connecting Egypt and Landlocked African Economies

This paper examines foreign value-added (FVA) trade determinants in seven African economies (2000–2022) namely: Egypt, Central Republic of Africa, Botswana, Uganda, Mozambique, Zambia and Rwanda, while emphasizing Egypt’s role in the Cairo-Cape Town corridor for landlocked nations. Using the dynamic panel, General Methods of Moments GMM with clustering, logistics efficiency (LPI_SCORE), industrialization (GMAUVA), and regional trade (C2CVA) are assessed. Results indicate a 1% FVA rise per $276,860 improvement in LPI, a $45,926 threshold in industrial value-added for 1% FVA growth, and a 43% reduction in freight costs via the corridor. A negative correlation between market size and FVA (-94.08) highlights the importance of corridor-driven exports over local demand. The study quantifies FVA thresholds, operationalizes C2CVA-FVA dynamics, and recommends Egypt-centric policies—such as harmonized infrastructure, SCEZ co-development, and digital integration—to advance the African Continental Free Trade Area AfCFTA Phase II implementation. It also introduces time-series clustering to enhance the rigor of panel data in GVC analyses. JEL Codes : F13, F15, F21, F53, F62, F68, O13, O14, O17, O19, O24, O55, O57, P33, P45, P48.