Trade as an Answer to Sustainable Economic Growth—The ECOWAS Story (original) (raw)
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Economic Development of ECOWAS Member States: The Impact of Intra-Regional Trade
The Journal of Pan-African Studies, 2018
This paper provides an assessment of the impact of intraregional trade on the economic development of the Economic Community of West African States (ECOWAS). The goal is to determine whether intraregional trade has a positive impact on the economies of member states. For this purpose, the analysis is based on data collected from the member states, focusing on economic information as well as official statistics produced by international institutions.
Caleb Journal of Social and Management Science, 2022
Economic literature identifies international trade as one of the channels through which sustainable economic growth can be achieved. For years, the relevance of trade in economic growth process has been one of the most commonly debated topics among economists and policy makers in Africa. This study investigates the effects of international trade on the economic growth of Economic Community of West African States (ECOWAS) from 2000 to 2018 across the 15 countries of the sub-region. Fixed effect model in a panel data environment was used for the analysis. The variables of interest are real gross domestic product, exports, imports, exchange rate, balance of payments and gross capital formation. The results show that exports, imports, exchange rate and balance of payments exert significant positive effects on economic growth of the ECOWAS, while gross capital formation exerts significant negative effect on growth of the economy of the countries. However, the independent variables jointl...
Journal of Economic and Financial Sciences
It is well known that developing countries have enormous constraints in what they can bring to global trade and investment. Economic Community of Western African States (ECOWAS) countries export primary commodities that make them vulnerable to external shocks. Inadequate infrastructure and the small size of their domestic markets often limit their access to foreign markets (Clark, Dollar & Micco 2004; Gulati et al. 2007). Rising trade costs and limited access to technology and intermediate inputs for firms in developing countries constitute a barrier to entry into world markets, as well as participation in global value chains (Arvis et al. 2013). Orientation: The establishment of the African Continental Free Trade Area has raised a new question regarding the link between gross domestic product (GDP) per capita and trade openness among economists and policymakers. Research purpose: The purpose of this research is to provide an understanding of the potential free trade agreement between Economic Community of Western African States (ECOWAS) countries. Motivation for the study: Trade liberalisation is seen as an avenue for African countries to achieve social and economic advancement. Therefore, establishing the contribution of trade to economic growth is of paramount importance to society, especially for developing economies. Research approach, design and method: This study used two econometric tools-the autoregressive distributed lag (ARDL) bound testing approach and the pool mean group (PMG) model-to assess the link between trade openness and GDP per capita in ECOWAS. The data set covers the 15 ECOWAS member countries over the period 1990-2016. Main findings: The study indicates the existence of a long-run relationship between the variables at 1% in all countries except for Ghana, Guinea-Bissau, Mali, Senegal and Togo. This implies that the variables are cointegrated; hence, the PMG can be used. The estimation reveals that trade openness has a negative impact on GDP per capita in the long run. The findings have important implications for policymakers in the ECOWAS region and other developing countries. Practical/managerial implications: The paper invites policymakers in the region to carefully consider the outcome of the agreement in each member country and adjust accordingly with tariff barriers. Contribution/value-add: Even though trade liberalisation can be beneficial, the lifting of trade barriers in all sectors among ECOWAS members will not contribute to growth. ECOWAS countries must decide the sectors they want to liberalise and also add value to their production of goods and services in order to fight poverty and boost income.
Can the Monetary Integration of ECOWAS Improve Intra-Regional Trade
A gravity model is used to evaluate the effects of currency union on intra-regional trade of ECOWAS (Economic Community of West African States) member states. The panel data used includes bilateral observations for fourteen years spanning 1994 through 2006 for 16 countries. Controlling for determinants and deterrents of trade, I find the presence of a currency union three times as likely to increase intra-regional trade between ECOWAS member countries. In addition, I find that the effect on trade creation has been steadily falling since 1994.
An empirical evaluation of trade potential in the economic community of West African States
1998
Intra-ECOWAS trade has remained very low despite the integration efforts in the subregion in the past two decades. While noting that these efforts have not progressed as scheduled, this study investigates what the West African countries stand to gain by way of increases in intra-regional trade flows if all trade barriers are removed. The study uses a gravity model whose results suggest that there is trade potential in the subregion. Specifically, it is the aim of this study to: * Determine the period within which integration effects were first felt or noticed. * Estimate trade potentials among ECOWAS member nations. * Test for the gaps between potential and actual trade among member nations. * Proffer suggestions to guide policy making on the basis of the major findings of the study.
Critical Analysis of Economic Community of West African States (Ecowas) Intra-Trade
Social Science Research Network, 2009
The main objectives of Economic community of west African states (ecowas) were the eventual elimination of all tariffs and trade barriers between members, the establishment of a customs union, unified fiscal policy and coordination of regional policies in transport ,communication, energy and other infrastructural facilities. To be to achieve this objective the formation of regional integration arrangement to enhance subregional trade becomes necessary. This analysis traced past colonial era to the present period and highlighted the challenges that militate against successful integration and also reviewed the new effort in the region to deal with potentials constraints to sub-regional trade integration especially how that regional trade blocs and multilateral institutions are promoting inter regional trade negotiations at the global level.
A Case-Study of the Economic Community of West African States (ECOWAS)
Palgrave Macmillan UK eBooks, 1999
A regional integration by its very nature integrates its members into an economic union and acts as a bloc on matters affecting its members visa -vis other regional blocs and non members. Its hegemonic nature of hedging its members against all forms of exploitation and intimidation by other regional blocs and non-members and its desire to stem the tide of trade diversion, and to create and foster intra-union flow of trade, factors and investment at the exclusion of non-members and other regional blocs run contradictory to the aims and objectives of the globalization process which is the integration of the world economy through the breaking down of trade and investment barriers worldwide. Given these contradictory objectives of the regional blocs and the globalization process, this study examines the roles of the ECOWAS as an agent in the globalization process in the West African sub-region, its constraints, and solutions to the problems.
Regional Trade and Monetary Integration in West Africa and Europe
Regional trade and monetary integration mark the core elements of any regional integration processes worldwide. However, the challenges are quite different: While the Member states of the European Union (EU) are economically and monetarily united, they are dealing with the imbalances and potential spill-overs effects resulting from the Euro zone crises. The Economic Community of West Africa States (ECOWAS), on the other hand, struggles with low levels of intra-regional trade, external dependencies and the goal of establishing a region-wide common currency. Inspired by the experience of each other, the WAI-ZEI anthology combines the reflections of well-known researchers from both regions on three of the most important questions in this regard: How can regional integration schemes contribute to enhance regional trade and integration into the global economy? What are the effects of monetary integration and how can synergies be created? To what extent can experiences of other regions be...
Recht in Afrika, 2018
The effects of regional economic integration on trade and development of the Member States of the Economic Community of West African States (ECOWAS) was chosen as topic for this article to examine how much impact regional integration has made among Member States. The history of regional economic integration is discussed to highlight the developmental trajectory of different regional groups. This paper has a critical look at the formation of regional economic blocs around the globe, with a view to show how they operate for the purpose of fostering regional cooperation among members. The history of the formation of the Economic Community of West African States and the challenges which have constrained its transformation into a complete regional economic union is also discussed.
Obstacles to trade liberalization and economic cooperation among west African states
Journal of International Development, 1993
Does the formation of a customs union reduce and eventually eliminate tariffs among member countries to provide mechanisms or regional institutions for social, economic and political development? The literature examined suggests that, although many problems of trade liberalization continue to occur, greater benefits could be obtained by reducing tariffs on a non-discriminatory basis, or by removing protection from domestic enterprises altogether, and by importing domestic requirements of the products of displaced industries from outside at world market prices. The literature also provides a valid case for protecting certain activities in ECOWASparticularly trade and industrial enterpriseseither for the purpose of increasing income or the rate of economic growth, or in order to achieve certain non-economic objectives. The implications of economic integration in these terms can best be examined within a broader theoretical framework of developmental theory of trade liberalization.