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Assessing the current account sustainability in ECCAS economies: A dual cointegration analysis

Marius Amba (), Taoufiki Mbratana () and Gilles Quentin Kane ()
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Taoufiki Mbratana: Faculty of Economics and Managment, University of Yaounde II, Cameroon.

Economics Bulletin, 2017, vol. 37, issue 3, 1873-1894

Abstract: This paper examines the sustainability of the current account deficits in eight Economic Community of Central African States (ECCAS) over the period 1970 to 2015. The empirical investigation relies on both panel and intra-panel approaches to test for long-run relationship between variables. Furthermore, non-linearity as well as asymmetric adjustment of Enders and Siklos (2001) is taken into account in cointegration analysis. Results from panel analysis show that; although exports and imports are cointegrated, the current account deficits are weakly sustainable in ECCAS. These results also hold in each country's analysis. Therefore, these eight ECCAS countries should implement policies to reinforce the sustainability of the current account deficits.

Keywords: Current account; Sustainability; ECCAS; Threshold Cointegration (search for similar items in EconPapers)
JEL-codes: F3 C2 (search for similar items in EconPapers)
Date: 2017-08-31
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