The Effect of Trade Liberalization on Exports, Imports and Balance of Payment: The Case of Sub-Saharan Africa

Abstract

We explore dynamic non-stationarity panel data estimators namely, mean group (MG) and pooled mean group (PMG) for investigating the extent to which trade policies such as trade liberalisation and tariff rates matter to trade performance using the case of Sub-Saharan Africa (SSA).We found that increasing tariffs has the potential of particularly worsening export growth in SSA but increasing openness via liberalisation policy is likely to spur decline in the import dependence of the SSA economy. Thus, we concluded that while trade liberalisation seems to exhibit no significant impact on export growth in SSA, the same policy may yet be explored to encourage decline in the region's import activities, particularly those import activities that might threaten the growth of domestic industries.

The relationship between globalisation and economic growth in West Africa

“…The author however assured a brighter future given that the country had embraced and ratified the African Continental Free Trade Area (AfCFTA) the crux of which is trade liberalisation in Africa. Because the free trade is strongly advocated as a means of accelerating economic growth (Odebode & Aras, 2020). Can Nigeria in isolation drive the growth of the ECOWAS sub region without other countries joining in the globalisation trend?…”