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The Impact of Trade Liberalization on Economic Growth in South Africa

Author

Listed:
  • Augustine Adebayo Kutu

    (School of Economics, University of Johannesburg, South Africa)

  • Abieyuwa Ohonba

    (School of Economics, University of Johannesburg, South Africa)

Abstract

The failure of the South African economy to achieve the desired economic expansion raised a serious concern to investigate the potency of trade liberalization policy adopted in the country. This is evidence in macroeconomic indices such as high level of unemployment, poverty and most importantly sluggish economic growth. It is against this back drop that this study was spurred to conduct an analysis of the impact of trade liberalization on economic growth in South Africa covering the period of 1986-2022. The mixed order of integration revealed by the unit root test informed the decision to adopt the ARDL method of estimation. The main findings of interest in this study is the existence of a strong positive relationship between trade liberalization and economic growth in South Africa. Thus, the study concludes that economic integration is healthy for the national economy and hence more liberalization policies should be strategically embrace. The study recommends that the African governments especially South Africa should further open it economic border to allow for free trade with other economies of the world.

Suggested Citation

  • Augustine Adebayo Kutu & Abieyuwa Ohonba, 2024. "The Impact of Trade Liberalization on Economic Growth in South Africa," International Journal of Economics and Financial Issues, Econjournals, vol. 14(6), pages 55-63, October.
    • Handle: RePEc:eco:journ1:2024-06-6
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    More about this item

    Keywords

    Trade Liberalization; Economic Growth; Autoregressive Distributed Lag Model;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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