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The potential effects of the ECCAS Free Trade Area on Trade Flows

DJEMMO FOTSO, Arnaud (2014): The potential effects of the ECCAS Free Trade Area on Trade Flows.

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Abstract

Analyzing some trade indicators and estimating a gravity model, this paper assesses the potential effects of an effective implementation of the ECCAS FTA. Launched since January 2004, the ECCAS FTA is not yet established: the main reforms that should be undertaken by the various members are still awaited. The results show that the potential for increasing intra-ECCAS trade, following the FTA, is limited by the narrow range of goods produced and exported by members; the fact that members have comparative advantages for similar products in which they are not important consumers; and the low complementarity in their trade profiles. To accelerate industrial development through a pooling of productive resources and capacities could improve the complementarity of the production structures in the sub-region and thus, increase the possibilities of intra-industry trade, key of intra-trade growth in model FTA.

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