Supplementary Trade Benefits of Multi-Memberships in African Regional Trade Agreements

Nicholas Ngepah, Maxwell Chukwudi Udeagha

Research output: Contribution to journalArticlepeer-review

42 Citations (Scopus)

Abstract

Few papers have investigated the trade effects of multi-memberships of Regional Trade Agreements (RTAs), but none has done this in an Africa-wide manner. This paper investigates the supplementary trade effects of multi-memberships of RTAs after controlling for single-membership for all African RTAs. We use (1) overall number of RTAs by country pair; (2) dummies of number of RTAs; and (3) number of RTA memberships by countries within each RTA grouping, in a panel of 53 African countries from 1995 to 2014. The gravity models are estimated with the Eicker-White robust covariance Poisson Pseudo-Maximum Likelihood (PPML) which is superior to previous ones. All the estimates concur that multi-memberships have significant additional intra-Africa trade benefits which increase with the number of memberships. The implication is that although RTAs enhance trade in Africa, it is only a second-best to a complete integration of the African continent. A complete dismantling of politically induced trade barriers and even inter-RTA boundaries within Africa will yield significant intra-Africa trade benefits. The results support the ongoing efforts in Africa in pursuing a “one Africa” vision. Such efforts have to transcend regional integration and pursue the ideal of an integrated Africa for the full trade benefits to be realized.

Original languageEnglish
Pages (from-to)505-524
Number of pages20
JournalJournal of African Business
Volume20
Issue number4
DOIs
Publication statusPublished - 2019

Keywords

  • Regional trade agreements
  • gravity model
  • multi-memberships
  • panel data
  • trade creation
  • trade diversion

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Development

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