The effect of trade liberalisation on the balance of trade and balance of payments in developing countries is still ambiguous. Free trade advocates believe that adopting free trade policy and specializing in production will enhance economic growth in both exports and imports, which in turn will have a positive impact on the balance of trade and the balance of payments. In the real world, not all countries that have adopted trade liberalisation have achieved economic growth. Some of them suffered deterioration in the balance of trade because imports grew more than exports did, adding more deficits to the balance of payments. In this case, trade liberalisation will be considered as a constraint on growth. This thesis was designed to explore the impact of trade liberalisation on the economies of Arab Maghreb Union (AMU) countries for fifteen years (1995-2009) in terms of export growth, import growth, the balance of trade, and the balance of payments. H The empirical evidence has revealed some major findings that can be considered strong evidence based on four different estimation techniques: ordinary least square, panel data, panel data with first difference, and Arellano-Bond test. The results show that trade liberalisation did not enhance export growth in AMU countries during the given period (1995 to 2009). In contrast, it had a significant positive impact on import growth during the same period. Moreover, trade liberalisation worsened the balance of trade and the balance of payments during the studied period. Therefore, it seems that trade liberalisation alone has not been enough to promote economic growth. A suitable domestic business environment, well-run government institutions, and supportive government policies are important in order for trade liberalisation to achieve its goals in developing countries.
| Identifer | oai:union.ndltd.org:bl.uk/oai:ethos.bl.uk:695683 |
| Date | January 2014 |
| Creators | Hadili, Abduraawf Moftah |
| Publisher | Keele University |
| Source Sets | Ethos UK |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
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