ERF 27th Annual Conference
Tunisia’s Trade with Sub-Saharan Africa: Large Room for Growth?
No.
ERF27_39
Publisher
ERF
Date
May, 2021
Topic
C3. Multiple or Simultaneous Equation Models
F5. International Relations, National Security, and International Political Economy
F1. Trade
This paper examines Tunisia's trade pattern with Sub-Saharan African (SSA) countries. Specifically, it investigates what are the main factors determining Tunisia's export flows with SSA countries, assesses export potential capacity and determines the proper commercial direction. To this end, an augmented gravity model is used for annual bilateral exports between Tunisia and 40 SSA partners over the 1995-2016 period. The model is estimated using the Pseudo Poisson Maximum Likelihood approach, which enables to deal with zero trade flows and leads to more efficient estimators than the other linear estimation methods. Two main results emerge from the analysis. First, geographical distance and institutional failure in SSA countries are the major obstacle to trade between Tunisia and its SSA partners. Second, the investigation reveals that Tunisia has a highly trade potential with many SSA countries, especially Mozambique, Kenya, São Tomé and Príncipe, Rwanda, Swaziland, Liberia, Niger and Togo. Therefore, SSA countries must be considered as real opportunities for Tunisian foreign trade. Our contribution is to shed light on the importance, for regional integration in SSA countries, and demonstrate the importance of SSA market for Tunisia to stimulate exports and reduce trade deficit.
Authors
Makrem Ben Doudou
Assistant Professor, Department of Economics, University of...
Authors
Christophe Rault
Full Professor of Economics, University of Orléans