Impacts Of Regional Trade Agreement On Agricultural Products In Africa Panel Data Approach

This study examines the effects of regional trade area or free trade area on trade inrnagricultural products within intra- COMESA countries and extra-COMESA countriesrnusing a panel data for the period (2001-2010). A panel data framework has manyrnadvantages vis-a.-vis the cross-section approach. It allows to disentangling countryspecificrnand time-specific effects. In order to analysis the impacts this study employedrnrandom affects GLS model depending on Hausman test guidance.rnThe contribution of this study to the literature is that the effects of FT A of COMESA isrnpositive and as expected and statistically significant .Agricultural trade have beenrndiverting from former COMESA members and from SADC members to newly establishedrnFT A member countries.rnThe findings is consistent the theory of Linder hypothesis that large size countries tend torntrade more with large size countries and Heckscher-Ohlin- Samuelson theorem. Mostrnresult of standard variable included in the gravity model is positive as expected andrnstatistically significant. The results of the study also confirm with the hypothesis that bothrnFTA and extra-COMES A agricultural trade is positively correlated with the volume ofrntrade but inversely with SADC and non FTA member COMESA countries.

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