Trade facilitation and trade flows: Evidence from Africa

This chapter investigates the impact of trade facilitation on trade flows for a sample of 20 African economies over the period 2007–2014. Using a panel vector autoregressive framework, it finds that trade facilitation enhances trade flows in those African countries. Economic growth, investment and the presence of regional trade agreements were also found to be ingredients of trade. Further analysis supports a bi-causal and reinforcing relationship between trade facilitation and trade flows, and the level of country development and presence of regional trade agreements were found to be factors that enhance trade facilitation. Interestingly, trade facilitation is also reported to have some positive effects on economic growth and level of investment.