MEASURING THE FOREIGN EXCHANGE PREMIUM AND THE PREMIUM FOR NON-TRADABLE OUTLAYS FOR TWENTY COUNTRIES IN AFRICA

Glenn Jenkins (), Chun-Yan Kuo and Sener Salci
Additional contact information
Chun-Yan Kuo: Queen's University, Canada

No 2013-05, Development Discussion Papers from JDI Executive Programs

Abstract: In this paper we develop an analytical general equilibrium framework to measure the foreign exchange premium and the premium for non-tradable outlays for a country. The framework allows us to capture in a consistent manner the impacts of the sourcing of funds and their expenditure on tradable and non-tradable goods and services of investment projects. An application of the model is carried out for 20 countries in Africa. The results show that the foreign exchange premiums range from 4.00% to 9.50% and the premium for non-tradable outlays from -1.75% to 1.50%. The empirical values depend on a number of factors, including the indirect taxes, production subsidies and international trade distortions of a country. These premiums should be incorporated into the economic evaluation of investment projects.

Keywords: Distortions; taxes; subsidies; foreign exchange premium; premium for non-tradable outlays; tradable goods; Africa (search for similar items in EconPapers)
JEL-codes: D58 H23 H43 O55 P45 R13 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2013-12
New Economics Papers: this item is included in nep-afr and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://cri-world.com/publications/qed_dp_229.pdf
https://cri-world.com/publications/qed_dp_229_a1.xlsx (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:qed:dpaper:229

Access Statistics for this paper

More papers in Development Discussion Papers from JDI Executive Programs Contact information at EDIRC.
Bibliographic data for series maintained by Mark Babcock ().