TRADE POLICY AND PERFORMANCE OF EXPORT MANUFACTURING INDUSTRIES
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Date
2021
Journal Title
Journal ISSN
Volume Title
Publisher
International Journal for research in Economics
Abstract
This study examines the impact of trade policy and performance of export manufacturing industries. It adopts
time series data on a number of policy variables to determine their impacts on the manufacture exports as well
as their significance or otherwise in stimulating export. The objectives are to (a) identify the major
determinants of manufacture exports; and (b) determine the causal relationship existing between manufacture
exports and trade policy - Openness, exchange rate, average tariff rates and capacity utilization. Empirical
analysis of the data from 1970 to 2014 using Vector autoregressive (VAR) model and granger co-integration
test have produced interesting results. Specifically, all the results have ultimately confirmed that there is,
indeed a significant relationship among manufacture exports, trade openness, exchange rate, average tariff
rates and capacity utilization. It is recommended that there should be urgent need to diversify the economy
away from single commodity oil; given the uncertainties in the world oil market, adopt policies that ensure
greater market access for the country’s manufacture exports as well as boosting their competitiveness at the
international market. These are achieved through the adoption of trade and exchange rate liberalization policies
that are devoid of control and regulations and lastly, policy option to moderate import liberalization in order to
reap the benefit of a positively related and significant exchange rate variable with manufacture exports within
the framework of market determined exchange rate.
Description
Keywords
Manufacture exports, Trade Policy, Vector autoregressive (VAR) model and Granger Cointegration test.