Multi-Membership and the Effectiveness of Regional Trade Agreements in Western and Southern Africa: A Comparative Study of ECOWAS and SADC
Institute of Social Sciences Working Paper No. 520
40 Pages Posted: 14 Mar 2011
Date Written: March 11, 2011
Using a gravity model for 35 countries and the years 1995-2006 we estimate the impact of regional trade agreements in Africa (in particular ECOWAS and SADC) and compare this to the a benchmark of North South trade integration (Europe’s preferential trade agreement). We find that
• ECOWAS and SADC membership significantly increases bilateral trade flows (and by more than for example preferential trade agreements with the EU do),
• SADC membership has a stronger impact compared to ECOWAS and
• That the impact of multi-membership critically depends on the characteristics of the overlapping RTA.
We find a positive impact if an additional membership complements the integration process of the original RTA: overlapping memberships had a significant positive effect on bilateral trade within the ECOWAS bloc but it is insignificant for SADC.
Keywords: Sub Sahara Africa, Regional Economic Integration, South-South Trade, North-South Trade Intra-regional Trade, Gravity Model, International Trade, Multi-Membership
JEL Classification: F1, F15, 018
Suggested Citation: Suggested Citation