New Economic Partnership for Africa's Development (NEPAD) and Africa's quest for regional economic integration: the case of Southern African Development Community (SADC)
- Authors: Chigombe, Courage
- Date: 2014
- Subjects: New Partnership for Africa's Development , Southern African Development Community , Sustainable development -- Africa, Southern , Africa, Southern -- Economic conditions , Africa -- Economic policy
- Language: English
- Type: Thesis , Masters , MA
- Identifier: http://hdl.handle.net/10353/2072 , vital:27604
- Description: Despite according high priority to regional economic integration and being clustered by regional economic schemes, Africa’s regional economic integration record is not inspiring. With the transformation of the OAU to the African Union (AU), the New Partnership for Africa`s Development (NEPAD) was adopted as the development program of the continent to drive the impetus of economic integration through trade. At the time NEPAD was adopted, regional integration schemes in Africa were facing problems of low intra-regional trade levels despite trade being identified as the engine of activity and economic growth for regional economic integration. The study was centered on Southern Africa with precise attention on SADC. Even though trade is accepted as a vital engine of economic growth and development, this is not the case with SADC. The study was looking at the contribution of NEPAD in intra-regional trade in Africa with special focus on SADC. This was prompted by the fact that regional integration is business as usual within the sub region while problems that have been confronting regional schemes are continuing unabated after the adoption of NEPAD. The study used the historical approach because it provides the study with an advantage of accessing existing literature with regards to what is really stalling intra-regional trade in SADC. The study findings noted that NEPAD has not fully addressed the problems of intra-regional trade within SADC and the continent at large. The study lastly concludes by giving a way forward for NEPAD to respond to the specific needs of SADC for the promotion of intra-regional and equitable trade.
- Full Text:
- Date Issued: 2014
- Authors: Chigombe, Courage
- Date: 2014
- Subjects: New Partnership for Africa's Development , Southern African Development Community , Sustainable development -- Africa, Southern , Africa, Southern -- Economic conditions , Africa -- Economic policy
- Language: English
- Type: Thesis , Masters , MA
- Identifier: http://hdl.handle.net/10353/2072 , vital:27604
- Description: Despite according high priority to regional economic integration and being clustered by regional economic schemes, Africa’s regional economic integration record is not inspiring. With the transformation of the OAU to the African Union (AU), the New Partnership for Africa`s Development (NEPAD) was adopted as the development program of the continent to drive the impetus of economic integration through trade. At the time NEPAD was adopted, regional integration schemes in Africa were facing problems of low intra-regional trade levels despite trade being identified as the engine of activity and economic growth for regional economic integration. The study was centered on Southern Africa with precise attention on SADC. Even though trade is accepted as a vital engine of economic growth and development, this is not the case with SADC. The study was looking at the contribution of NEPAD in intra-regional trade in Africa with special focus on SADC. This was prompted by the fact that regional integration is business as usual within the sub region while problems that have been confronting regional schemes are continuing unabated after the adoption of NEPAD. The study used the historical approach because it provides the study with an advantage of accessing existing literature with regards to what is really stalling intra-regional trade in SADC. The study findings noted that NEPAD has not fully addressed the problems of intra-regional trade within SADC and the continent at large. The study lastly concludes by giving a way forward for NEPAD to respond to the specific needs of SADC for the promotion of intra-regional and equitable trade.
- Full Text:
- Date Issued: 2014
The impact of economic freedom on economic growth in the SADC
- Authors: Gorlach, Vsevolod Igorevich
- Date: 2014
- Subjects: Free enterprise -- Africa, Southern , Economic development -- Africa, Southern , Africa, Southern -- Economic conditions
- Language: English
- Type: Thesis , Doctoral , DCom
- Identifier: vital:9030 , http://hdl.handle.net/10948/d1020786
- Description: The role of institutions – economic freedom – is a critical determinant of economic growth, yet the global distribution of economic freedom is skewed. Economic freedom focuses on personal choice, the ability to make voluntary transactions, the freedom to compete and the security of property rights. The SADC is attempting to alleviate poverty and achieve sustainable development and economic growth. This thesis illustrates that economic freedom, in aggregate, and on an individual component basis, drives economic growth. The annual data for the 12 SADC counties from 2000 to 2009 are used to construct a panel data model to conduct the empirical analyses. Cross-sectional effects, as well as time (period) effects, are valid; and thus, a two-way error-component model is estimated. The Hausman test showed the regressors to be endogenous and correlated with the error term. The Pesaran CD test, suitable for dynamic panels, determined that cross-sections are interdependent; and the cross-correlation coefficient indicated a relatively weak, yet substantial, correlation. The LSDV two-way error-component model is re-estimated using the Driscoll and Kraay standard errors and time-demeaned data to correct for cross-sectional dependence. Given the endogeneity between the idiosyncratic disturbance term and the regressors, the presence of heteroskedasticity and serial correlation, as well as the interdependence amongst the cross-sections, the econometric model is then estimated using the two-step system general method of moments with forward orthogonal deviations – instead of differencing. The results meet all the post-estimation diagnostic requirements: the Arellano and Bond test for second-order serial correlation fails to reject the null hypothesis of no autocorrelation; theSargan test for over-identification fails to reject the null hypothesis that the over-identification restrictions are valid, and the difference-in-Hansen test fails to reject the null hypothesis that the instrument subsets are strictly exogenous. The empirical results confirm the a priori expectations. Economic freedom is a positive and significant driver of economic growth. Investment and economic openness are positively related to growth, whereas government debt decreases growth. Government consumption is an insignificant driver of a country’s growth. The Granger causality test confirmed the direction of causality; economic freedom precedes economic growth; and it is possible for the SADC to improve their growth rates by becoming economically freer. The coefficient of adjustment derived from the error-correction model indicates that the dynamic system takes approximately two years to adjust to the long-run structural level. The Koyck Transformation indicates that the relationship between economic freedom and growth is intertemporal, requiring a lag structure. An impulse-response function shows that a permanent, positive ‘shock’ to economic freedom results in an increase in economic growth, although the extent differs for each country, as well as for the different freedom components. The five individual economic freedom components are all highly significant and positive drivers of growth; however, the magnitude of the elasticity parameters varies. The causality amongst the components indicates that bidirectional causality is present. Therefore, improving economic freedom in one area improves economic freedom in another, creating a multiplier effect.
- Full Text:
- Date Issued: 2014
- Authors: Gorlach, Vsevolod Igorevich
- Date: 2014
- Subjects: Free enterprise -- Africa, Southern , Economic development -- Africa, Southern , Africa, Southern -- Economic conditions
- Language: English
- Type: Thesis , Doctoral , DCom
- Identifier: vital:9030 , http://hdl.handle.net/10948/d1020786
- Description: The role of institutions – economic freedom – is a critical determinant of economic growth, yet the global distribution of economic freedom is skewed. Economic freedom focuses on personal choice, the ability to make voluntary transactions, the freedom to compete and the security of property rights. The SADC is attempting to alleviate poverty and achieve sustainable development and economic growth. This thesis illustrates that economic freedom, in aggregate, and on an individual component basis, drives economic growth. The annual data for the 12 SADC counties from 2000 to 2009 are used to construct a panel data model to conduct the empirical analyses. Cross-sectional effects, as well as time (period) effects, are valid; and thus, a two-way error-component model is estimated. The Hausman test showed the regressors to be endogenous and correlated with the error term. The Pesaran CD test, suitable for dynamic panels, determined that cross-sections are interdependent; and the cross-correlation coefficient indicated a relatively weak, yet substantial, correlation. The LSDV two-way error-component model is re-estimated using the Driscoll and Kraay standard errors and time-demeaned data to correct for cross-sectional dependence. Given the endogeneity between the idiosyncratic disturbance term and the regressors, the presence of heteroskedasticity and serial correlation, as well as the interdependence amongst the cross-sections, the econometric model is then estimated using the two-step system general method of moments with forward orthogonal deviations – instead of differencing. The results meet all the post-estimation diagnostic requirements: the Arellano and Bond test for second-order serial correlation fails to reject the null hypothesis of no autocorrelation; theSargan test for over-identification fails to reject the null hypothesis that the over-identification restrictions are valid, and the difference-in-Hansen test fails to reject the null hypothesis that the instrument subsets are strictly exogenous. The empirical results confirm the a priori expectations. Economic freedom is a positive and significant driver of economic growth. Investment and economic openness are positively related to growth, whereas government debt decreases growth. Government consumption is an insignificant driver of a country’s growth. The Granger causality test confirmed the direction of causality; economic freedom precedes economic growth; and it is possible for the SADC to improve their growth rates by becoming economically freer. The coefficient of adjustment derived from the error-correction model indicates that the dynamic system takes approximately two years to adjust to the long-run structural level. The Koyck Transformation indicates that the relationship between economic freedom and growth is intertemporal, requiring a lag structure. An impulse-response function shows that a permanent, positive ‘shock’ to economic freedom results in an increase in economic growth, although the extent differs for each country, as well as for the different freedom components. The five individual economic freedom components are all highly significant and positive drivers of growth; however, the magnitude of the elasticity parameters varies. The causality amongst the components indicates that bidirectional causality is present. Therefore, improving economic freedom in one area improves economic freedom in another, creating a multiplier effect.
- Full Text:
- Date Issued: 2014
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