Intra-Regional Agricultural Exports in the East African Community
DOI:
https://doi.org/10.61538/ajer.v5i1.433Abstract
This study investigated the causes of intra-EAC agricultural exports. Five Augmented gravity models were estimated using the Pseudo Poisson Maximum Likelihood (PPML) Approach. The study used panel data from UNCOMTRADE, International Financial Statistics and World Development Indicators for the period 2000 – 2012 on the five EAC members. The intra-EAC agricultural exports depended on various factors, including GDP of exporter, GDP of the importer, Exchange rate, distance between the economic centers, language similarities, adjacency and population of the exporter. EAC secretariat and respective governments in EAC should also reduce currency value disparities among the member states as a means of promoting intraregional agricultural trade. The proposed monetary union and harmonization of currencies would significantly promote agricultural trade within the region. The EAC member states should also enhance border liberalization, as this will also promote intra-regional agricultural trade, among other measures.References
Anderson, J. E. and Van Wincoop, E. (2003). “Gravity with Gravitas: A Solution to the Border Puzzle,†The American Economic Review, 93(1), 170-192.
Anderson, J. E., (1979). “A theoretical foundation for the gravity equation,†American Economic Review, 69, 106-116.
Byerlee, D., Diao, X. and Jackson, C. (2005). Agriculture, Rural Development, and Pro-Poor Growth: Country Experience in the Post-Reform Era, Agricultural and Rural Development Discussion Paper 21. Washington DC: The World Bank.
Diao, X. and Yanoma, Y. (2002). Exploring Regional Dynamics in Sub-Saharan Africa Agriculture, Development Strategy and Governance Division, International Food Policy Research Institute.
EAC (2010). Trade Report 2008, East African Community Secretariat, Arusha.
EAC Secretariat (2011). East African Community Facts and Figures, Arusha.
Elbadawi, I (1997). The Impact of Regional Trade and Monetary Schemes on Intra-Sub-Saharan Africa Trade. Regional Integration and Trade Liberalization in Sub-Saharan Africa, Hounmills, Basingstoke.
Elbadawi, I.A. (1998). Can Africa export manufactures? The role of endowment, exchange rates and transaction costs. Mimeo, World Bank.
Furtan, H. W., and Van Belle, B.M. (2004). “Canada’s Agricultural Trade in North America: Do Borders Matter?†Review of Agricultural Economics, 26(3), 317-331.
Grant, J.H. and Lambert, D.M. (2005). Regionalism in world agricultural trade: Lessons from gravity model estimation. Mimeo, Purdue University.
Musonda, F. M. (1997). Intra-Industry Trade between Members of the PTA/COMESA Regional Trading Arrangements. AERC Research Papers, 64, 10-17.
Ouma, D. (2010). An Empirical Analysis of the Determinants of Intra-Industry Trade between Kenya and the East African Community Countries: The Gravity Model. Unpublished MA Thesis, University of Mauritius.
Vinaye, A. D. (2009). Assessing the SADC’s potential to promote intra-regional trade in agricultural goods. University of Mauritius, Reduit.
Viner, J. (1950). The Customs Union Issue, New York: Carnegie Endowment for International Peace. New York.
Vollrath, T.L. (1998). RTAs and Agricultural Trade: A Retrospective Assessment. In M. Burfisher and E. Jones (eds.), Regional Trade Agreements and U.S. Agriculture. Agricultural Economic Report, 771.
Winston, S. and Castellanos, C. (2011). Trade in East African: Increased intraregional trade and lower tariffs are paving way for faster growth. IMF Finance and Development.
World Bank (2009). The Little Data Book on Africa 08/09. World Bank
Yang, Y. and Gupta, S. (2005). Regional Trade Arrangements in Africa: Past Performance and the Way Forward. IMF Working Paper No. 05(36).
Trivić,J. and L. Klimczak (2015). The determinants of intra-regional trade in the Western Balkans. Zb. rad. Ekon. fak. Rij. vol. 33 • sv. 1 • 37-66
Mukiibi, P. (2016). Determinants of Intra-regional Trade Flows: A case of Uganda’s Bilateral Trade with her East African Community State Partners. Lawyerissue, January, 2016.
