Rwanda’s trade potential in comesa: an empirical evaluation

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University of Dar es Salaam
Trade among the member states of the Common Market for Eastern and Southern African countries [COMESA], formally Preferential Trade Area (PTA) remained very low despite the integration efforts in the sub-region in the past two decades. While noting that these efforts have not progressed as scheduled, this study intended to investigate what the member states in general and Rwanda in particular stand to gain by way of increases in intra-regional trade flows if all trade barriers are removed. The study used a gravity model. In this model, the principal determinants of intra-regional trade are specified to be border and distance, which has a negative significant relationship with intra-region trade, and their per capita GDPs. Therefore, this study used available bilateral trade data between members to assess the benefits expected from COMESA Free Trade Area (FTA), given the economic structure disparities existing among the members. The results of the study show that intra-COMESA trade liberalization mainly considers institutional barriers, leaving other important factors such as natural and other barriers such as geographical border and distance, cultural, historical factors, etc; aside. The study, therefore, suggests the proper management of COMESA integration efforts that should include all other factors which influence international trade. This integrated approach will help to obviate unfair distribution of economic activities in the region, by considering and addressing natural and other barriers in their decision making techniques.
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class mark (THS EAF HD6350.R8B83)
Evaluation, Potential
Bugingo, E.F (2004) Rwanda’s trade potential in comesa: an empirical evaluation, Master dissertation, University of Dar es Salaam. Dar es Salaam.