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Appraisal of Trade Potency on Economic Growth in Sudan: New Empirical and Policy Analysis

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  • Sayef Bakari

Abstract

This paper investigates the relationship between domestic investment, exports, imports, and economic growth in Sudan. In order to achieve this purpose, annual data were collected from the reports of World Bank for the periods between 1976 and 2015, was tested by using Augmented Dickey-Fuller (ADF) and Phillip-Perron (PP) stationary test, co integration analysis of Vector Error Correction Model and the Granger-Causality tests. According to the result of the analysis, unit root tests show that economic growth, domestic investment, exports and imports series become stationary when first difference is considered. Also, it was determined by using co integration analysis that there is relationship between the four variables in Sudan. Also, and according to the Vector Error Correction Model, there is no relationship between variables in the long run term. On the other hand, and according to the Granger-Causality tests, we defined that in the short run term, only economic growth cause domestic investment. These results provide evidence that Reforms and measures in economic strategies are still insufficient to make trade and domestic investment able to boost the Sudan's economy.

Suggested Citation

  • Sayef Bakari, 2017. "Appraisal of Trade Potency on Economic Growth in Sudan: New Empirical and Policy Analysis," Asian Development Policy Review, Asian Economic and Social Society, vol. 5(4), pages 213-225.
    • Handle: RePEc:asi:adprev:v:5:y:2017:i:4:p:213-225:id:287
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    More about this item

    Keywords

    Exports; Imports; Economic growth; Sudan; Cointegration; Vector error correction model and causality.;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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