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Effet du taux de change réel sur la balance commerciale: le cas du Gabon
[The Impact of Real Exchange Rates on the Trade Balance: The Case of Gabon]

Author

Listed:
  • Chomteu Kouam, Sorel Francine
  • Abo Ekomie, Alain
  • Bahouayila, Chancel

Abstract

The Gabonese economy is poorly diversified and highly dependent on crude petroleum’s international price, and therefore on the fluctuations in the exchange rate (REER). This study aims to determine the effect of real exchange rate on the trade balance of Gabon. The data are from World Bank (2007). The method used is co integration and an error correction model (ECM) was estimated. The results suggest that the REER and household income have a negative impact on the trade balance, while foreign income has a positive impact on him. Indeed, growth of 1% of the REER causes a deterioration of 2.37% of the trade balance. Moreover, an increase of 1% of national income (GDP) causes long-term deterioration of 5.19% of Gabon's trade balance. In addition, an increase of foreign income (GDPR) by 1% leads to an improvement of 12.64% of Gabon's trade balance in the long term. With these results the Gabonese government's interest to rethink its economic policy, a revival of its manufacturing sector in order to improve its trade balance.

Suggested Citation

  • Chomteu Kouam, Sorel Francine & Abo Ekomie, Alain & Bahouayila, Chancel, 2010. "Effet du taux de change réel sur la balance commerciale: le cas du Gabon [The Impact of Real Exchange Rates on the Trade Balance: The Case of Gabon]," MPRA Paper 38606, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:38606
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    References listed on IDEAS

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    More about this item

    Keywords

    Real exchange rate; trade balance; Gabon; VECM;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements

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