Comparative advantage and trade performance of selected east African community countries trading coffee under “everything but arms” export regime
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Date
2021
Authors
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Journal ISSN
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Publisher
Sokoine University of Agriculture
Abstract
The main objective of the study was to assess the comparative advantage and trade
performance of selected East African Community (EAC) countries trading coffee under
the Everything But Arms (EBA) export regime. The specific objectives were to analyze
the comparative advantage of selected EAC countries trading coffee in the European
Union (EU) market before the EBA export regime; to analyze the comparative advantage
of selected EAC countries trading coffee in the EU market during the EBA export regime;
to analyze the effect of EBA on selected EAC countries’ trade performance attributed by
coffee export in the EU market. RCA analysis was used to calculate the comparative
advantage of these countries. Data from 1995 to 2000 was obtained from the UNCTAD
database and from 2001 to 2019 was obtained from the WITS-UN COMTRADE
database. Also, the study estimated the augmented gravity model using panel data from
1995 to 2019 to capture the effect of EBA in bilateral trade flows between trading
countries. The findings show that all selected countries (Burundi, Uganda, Rwanda and
Tanzania) have a comparative advantage in exporting coffee to the EU but decreased
during the EBA regime. Using the gravity model, the results found that preferential trade
agreements under EBA have a negative effect on coffee export performance of the
selected EAC countries. These findings thus defeat the aim of EBA of increasing trade
exports for LDCs at individual countries level. Therefore, EAC countries need to diversify
their exports to reduce the effects of any future uncertainties of these given preferential
agreements.
Description
Dissertation
Keywords
East Africa Community, Coffee trading, Export regime, Trade Performance