PurposeQatar, a wealthy country with an open economy has limited arable land. To meet its domestic food demand, the country heavily relies on food imports. Additionally, the over three year-long economic embargo enforced by regional neighbors and the covariate shock of the COVID-19 pandemic have demonstrated the country's vulnerability to food insecurity and potential for structural breaks in macroeconomic data. The purpose of this paper is to examine short- and long-run determinants of Qatar's imports of aggregate food, meats, dairy and cereals in the presence of structural breaks.Design/methodology/approachThe authors use 24 years of food imports, gross domestic product (GDP) and consumer price index (CPI) data obtained from Qatar's Planning and Statistics Authority. They use the autoregressive distributed lag (ARDL) cointegration framework and Chambers and Pope's exact nonlinear aggregation approach.FindingsUnit root tests in the presence of structural breaks reveal a mixture of I (1) and I (0) variables for which standard cointegration techniques do not apply. The authors found evidence of a significant long-run relationship between structural changes and food imports in Qatar. Impulse response functions indicate full adjustments within three-quarters of a year in the event of an exogenous shock to imports.Research limitations/implicationsAn exogenous shock of one standard deviation on this variable would reduce Qatar's food imports by about 2.5% during the first period but recover after the third period.Originality/valueThe failure of past aggregate food demand studies to go beyond standard unit root testing creates considerable doubt about the accuracy of their elasticity estimates. The authors avoid that to provide more credible findings.
Faced with food supply disruptions due in part to geopolitics and political instability in its traditional food source markets in the Kingdom of Saudi Arabia and the United Arab Emirates, Qatar—a wealthy, highly import-dependent open economy—plans to identify a set of alternative markets that can assure it of a stable food supply chain and food security. This study develops a set of preferences and import substitution elasticities for the country’s four most important food categories: meats, dairy, vegetables, and cereals. We used quarterly food import data from 2004 to 2017 and the Restricted Source-Differentiated Almost Ideal Demand System (RSDAIDS) to estimate import-substitution elasticities for meats, dairy, vegetables, and cereals imported by Qatar. Based on our findings, India, Australia, and the Netherlands emerged as Qatar’s most competitive sources of food, followed by Brazil, Jordan, and Argentina. Qatar can assure sustained demand for food imports from the aforementioned countries in order to address its food security.
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