Understanding Trade Dynamics in Sub-Saharan Africa

Hany Abdel-Latif, Khushboo Khandelwal and Longmei Zhang

No 2025/045, IMF Working Papers from International Monetary Fund

Abstract: This paper explores export and import dynamics in sub-Saharan Africa (SSA), both regionally and across various country groups. The findings underscore the significant associations that domestic demand and exports have with import changes, albeit the magnitude of these associations varies across countries. Variations in consumption and investment are highly correlated with changes in imports across the region and in nearly all country groups. Changes in exports are also associated with increased import growth, with this link being most notable in resource-intensive countries. Furthermore, an appreciation of the real effective exchange rate is correlated with reduced import growth in East African countries, while resource-intensive countries experience a less pronounced correlation. Exports, on the other hand, show a strong sensitivity to global economic cycles, reflecting the region's reliance on commodities. Finally, the correlation between exchange rates and exports exhibits considerable heterogeneity across countries.

Keywords: Import demand; Export determinants; Sub-Saharan Africa; AfCFTA; understanding trade dynamics; export determinant; import change; trade dynamics; Imports; Exports; Oil exports; Trade balance; Real effective exchange rates; Global (search for similar items in EconPapers)
Pages: 29
Date: 2025-02-21
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