Analysis Of The Performance Of Exports And Competitive Advantage For Growth And Development In Ethiopia The Case Of Sesame Seed

Based on the general objective of the research to describe and analyze the sesame seedsrnproduction, comparative advantage and export trade performance, competitiveness and exportrnpotentials of Ethiopia, from the perspective of the global and African regional levels, the studyrnaddressed four specific objectives, covering the period 1970 to 2018, by using market share,rngrowth rate and related trade performance indicators, RCA and RSCA, export and importrngeographic concentration ratios analysis, econometric analysis using the ARDL model, and alsorncarried out assessment of sesame seed export potential by utilizing UNCTAD export potentialrnand gap methodology. For the ARDL econometric model post estimation diagnostic tests werernalso carried out. Africa’s share of world sesame seed export volume is about 65.5%, the leadingrnexporters and their global export volume share are: Sudan (21.8%), Ethiopia (11.4%), followedrnby Nigeria (10.6%). Ethiopia’s RCA and RSCA have been higher though showing declinesrnrecently. Ethiopia’s leading export destination (61.9%) is China (also the world number onernimporter) and 20.4% to Israel (the world 6th importer of sesame seed). Ethiopia’s exportrnconcentration ratio was a high of 0.33, higher than the global average of 0.11; while thernimporter’s concentration ratio of the leading importing country, China, was 0.18, indicative ofrnhigher number of supplying countries, and implying higher competition in exporting to China.rnThe ARDL econometric model analysis revealed that in both the short run and the long run,rnEXVAL (sesame export value) and EXVOL (sesame export volume) are affected statisticallyrnsignificantly by GDPeth (positively), REER (negatively), IMPDD (negatively). On elasticityrnresults, both equation 1 (EXVAL) and equation 2 (EXVOL) are highly elastic to three of the fourrnindependent variables, namely, GDPeth, REER and IMPDD, both in the short and long run.rnRegarding Pairwise Granger Causality Test results, while both EXVAL and EXVOL doesrngranger cause GDPeth, reinforcing the importance of export development as engine of economicrngrowth, EXPPPRATIO granger cause EXVAL as well as EXVOL. Besides, EXVAL as well asrnEXVOL have bi directional causality with REER. Regarding the export potentials, Ethiopia hasrnhuge untapped export potential in sesame seeds, with current export to total world potentialrnpercentage share at 32.7% - an export untapped potential of 67.3%. Finally, towardsrnmaintaining and improving the comparative advantage & boosting the competitiveness ofrnsesame seeds export, the study recommends: expanding sesame seed of production; improvingrnproduct quality and value additions and the domestic marketing system (including ECX tradingrnsystem); pursuing export market and product development and diversification; streamliningrntrade logistical and other domestic cost push factors; addressing the misalignment in exchangernrate and the appreciating REER; developing and maintaining highly professional exporterrncompanies, by implementing the identified respective strategies for action

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