Trade Policies, Regional Integration, Poverty and Income Distribution in Senegal

Poverty and Economic Policy Research Network Working Paper No. MPIA-2007-15

25 Pages Posted: 1 Aug 2007 Last revised: 25 Feb 2009

See all articles by Abdoulaye Diagne

Abdoulaye Diagne

Université Cheikh Anta Diop; University of Angers - Centre de Recherche en Epistémologie Appliquée (CREA)

François Joseph Cabral

Université Cheikh Anta DIOP - Faculté des Sciences Economiques et de Gestion ; Consortium for Economic and Social Research (CRES); Université de Sherbrooke - Research Group in Economics and International Development (Gredi)

Fatou Cissé

Université Cheikh Anta Diop

Multiple version iconThere are 2 versions of this paper

Date Written: September 2008

Abstract

Since January 2002 and within the framework of the sub-regional economic integration process conducted by the West African Economic and Monetary Union (WAEMU), Senegal has adopted the institution of a Common External Tariff (CET) and the harmonization of the tax system. These measures have considerably reduced the protection of its economy (50% reduction in customs duties) and consolidated its domestic tax system. Such trade reforms induce considerable general equilibrium effects. The objective of this paper is to assess the impact of trade liberalization scenarios in Senegal on the well-being of both rural and urban households.

The findings of this study reveal that Government has, under the implementation of the CET, given more priority to fiscal consolidation than to the potential negative effects of a higher VAT on income distribution and the well-being of households. This arbitration falls in line with the usual spirit of local stabilization and adjustment policies which have always been characterized by the primacy of fiscal rehabilitation over the enhancement of competitivity and the reflation of economic growth.

Keywords: Computable general equilibrium model, poverty analysis, trade policy, income distribution, regional integration

JEL Classification: D58, D31, F41, I32

Suggested Citation

Diagne, Abdoulaye and Cabral, François Joseph and Cissé, Fatou, Trade Policies, Regional Integration, Poverty and Income Distribution in Senegal (September 2008). Poverty and Economic Policy Research Network Working Paper No. MPIA-2007-15, Available at SSRN: https://ssrn.com/abstract=999372 or http://dx.doi.org/10.2139/ssrn.999372

Abdoulaye Diagne (Contact Author)

Université Cheikh Anta Diop ( email )

B.P. 5005
Dakar-Fann 16996
Senegal

University of Angers - Centre de Recherche en Epistémologie Appliquée (CREA)

Ecole Polytechnique
1, rue Descartes
75005 Paris
France

François Joseph Cabral

Université Cheikh Anta DIOP - Faculté des Sciences Economiques et de Gestion ( email )

B.P. 5005
Dakar-Fann 16996
Senegal
2218250530 (Phone)
2218250530 (Fax)

HOME PAGE: http://www.ucad.sn

Consortium for Economic and Social Research (CRES)

Orrantia del Mar Lima
Peru

Université de Sherbrooke - Research Group in Economics and International Development (Gredi)

Sherbrooke, Quebec
Canada

Fatou Cissé

Université Cheikh Anta Diop ( email )

B.P. 5005
Dakar-Fann 16996
Senegal

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