Trade Liberalization in Egypt

Keith Maskus and Denise Konan

Review of Development Economics, 1997, vol. 1, issue 3, 275-293

Abstract: A computable general equilibrium model of Egypt is developed to analyze proposed reforms in its trade policies, including a partnership agreement with the European Union. The model has multiple trading regions and allows for administrative trade barriers and tariffs. The paper reports computations of the revenue impacts of trade liberalization and the required changes in distortionary commodity taxes to maintain a fixed real government budget. Egypt’s greatest potential gains come from removing its administrative trade barriers while adopting globally free trade. The partnership agreement with the EU could lower or raise Egypt’s welfare, depending on prior trade reform.

Date: 1997
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