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Mega-Deals: What Consequences for SSA?

Mega-Deals: What Consequences for SSA? AbstractThe SSA countries are excluded from the mega-deals, free trade agreements (FTA) currently under negotiations between several large economies (EU–USA, EU–Japan, China–Japan–Korea, Trans-Pacific Partnership and ASEAN+6). As SSA exports remain dependent on these large markets, SSA countries could undergo important economic impacts. Using a dynamic Computable General Equilibrium Model, we find that mega-deals would have a negative impact on the welfare of SSA countries. Regional integration (through the negotiation of the ‘Tripartite’ FTA, which gathers, 26 African countries) might limit these losses, but SSA countries that are not involved still undergo negative consequences. A continental regional trade agreement involving all SSA countries would counterbalance the negative impacts of the mega-deals. We also show that openness of SSA countries towards Asia could be a potential solution to avoid trade diversion. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of African Economies Oxford University Press

Mega-Deals: What Consequences for SSA?

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References (32)

Publisher
Oxford University Press
Copyright
© The Author 2016. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals. permissions@oup.com
ISSN
0963-8024
eISSN
1464-3723
DOI
10.1093/jae/ejw029
Publisher site
See Article on Publisher Site

Abstract

AbstractThe SSA countries are excluded from the mega-deals, free trade agreements (FTA) currently under negotiations between several large economies (EU–USA, EU–Japan, China–Japan–Korea, Trans-Pacific Partnership and ASEAN+6). As SSA exports remain dependent on these large markets, SSA countries could undergo important economic impacts. Using a dynamic Computable General Equilibrium Model, we find that mega-deals would have a negative impact on the welfare of SSA countries. Regional integration (through the negotiation of the ‘Tripartite’ FTA, which gathers, 26 African countries) might limit these losses, but SSA countries that are not involved still undergo negative consequences. A continental regional trade agreement involving all SSA countries would counterbalance the negative impacts of the mega-deals. We also show that openness of SSA countries towards Asia could be a potential solution to avoid trade diversion.

Journal

Journal of African EconomiesOxford University Press

Published: Mar 1, 2017

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