Socio-economic Relationship and Currency Impact on the Rebirth of Senegambia: The 15th Executive Council of the Economics and Management Students Association

Ebou Faal, Ebrima L Dampha, Ebrima K Ceesay and Habibatou Drammeh
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Ebou Faal: Department of Economics, School of Business and Public Administration, University of the Gambia, The Gambia.
Ebrima L Dampha: Department of Economics, School of Business and Public Administration, University of the Gambia, The Gambia.
Ebrima K Ceesay: Department of Economics, School of Business and Public Administration, University of the Gambia, The Gambia.
Habibatou Drammeh: Department of Management, School of Business and Public Administration, University of the Gambia, The Gambia.

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Abstract: In 1991, The Gambia and Senegal signed the Treaty of Friendship and Cooperation to promote trade between them and to make their relations more harmonious and stronger. The purpose of this study is to determine the socio-economic relationship and the impact of the currency on the re-birth of Senegambia and how this new relationship will affect the social and economic exchange rates of the two countries from 1996 to 2017. The results show that in the short-run, the lag of the log of exchange rates and log of terms of trade show a positive sign on the log of GDP. However, inflation and unemployment show a negative sign on the log of GDP. Further, only the log of exchange rate has a positive effect on GDP in the long run. To conclude, the log of exchange rates is significant on the log of GDP in the short-run and long-run. The researchers recommend that policy makers should reduce the tax levied on imported goods from Senegal, reduce domestic prices of goods and services, avoid border closure, and improve the domestic industries.

Date: 2019-07-29
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Published in Asian Journal of Economics, Finance and Management , 2019, 1 (1), pp.88-98

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05303056

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