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Uganda's revealed comparative advantage: the evidence with the EAC and China

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  • Shinyekwa, Isaac
  • Othieno, Lawrence

Abstract

The paper examines the comparative advantage of Uganda’s exports to the East African Community (EAC) partner states, and how it has evolved during the implementation of the EAC treaty. In addition, the paper seeks to identify commodities that Uganda should specialize in as a basis to enhance the ability to benefit from the special preferential treatment extended to Uganda by China. The paper applies various indices in the measurement of Uganda’s Revealed Comparative Advantage (RCA) on all products at Harmonised System (HS4)-digit product levels. The HS4-digit product level data was obtained from World Integrated Trade Solution (WITS) UNCTAD COMTRADE database. The empirical evidence of Uganda’s comparative advantage in this context is largely dependent on the individual country under consideration. However, it is evident that Uganda’s list of commodities for exports to the EAC partner states is rapidly expanding and the RCA has increased especially during the implementation of the Customs Union. This is plausibly explained by the removal of internal tariffs along Uganda’s borders with the EAC partner countries and the adoption of a common external tariff. The paper therefore recommends that the identified list of commodities with RCA should be the basis for strategically informing the Uganda industrialization strategy within the context of further EAC integration. Uganda has RCA in only 234 product lines from the list of 4,401 HS 6-digit level disaggregation, suggesting that Uganda will minimally benefit on the basis of revealed comparative advantage. As an alternative, Uganda should explore policy options that could address supply constraints in a bid to increase the range of products Uganda could export to China, as well as the regional Partner States.

Suggested Citation

  • Shinyekwa, Isaac & Othieno, Lawrence, 2011. "Uganda's revealed comparative advantage: the evidence with the EAC and China," Research Series 150474, Economic Policy Research Centre (EPRC).
    • Handle: RePEc:ags:eprcrs:150474
    DOI: 10.22004/ag.econ.150474
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    References listed on IDEAS

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    1. Eckhard Siggel & Germina Ssemogerere, 2004. "Uganda's policy reforms, industry competitiveness and regional integration: a comparison with Kenya," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 13(3), pages 325-357.
    2. Alex Hoen & Jan Oosterhaven, 2006. "On the measurement of comparative advantage," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 40(3), pages 677-691, August.
    3. Dornbusch, Rudiger & Fischer, Stanley & Samuelson, Paul A, 1977. "Comparative Advantage, Trade, and Payments in a Ricardian Model with a Continuum of Goods," American Economic Review, American Economic Association, vol. 67(5), pages 823-839, December.
    4. Laaser, Claus-Friedrich & Schrader, Klaus, 2002. "European integration and changing trade patterns: the case of the Baltic states," Kiel Working Papers 1088, Kiel Institute for the World Economy (IfW Kiel).
    5. Thomas Vollrath, 1991. "A theoretical evaluation of alternative trade intensity measures of revealed comparative advantage," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 127(2), pages 265-280, June.
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    Cited by:

    1. John Spray & Sebastian Wolf, 2017. "Industries without smokestacks in Uganda and Rwanda," WIDER Working Paper Series 012, World Institute for Development Economic Research (UNU-WIDER).
    2. John Spray & Sebastian Wolf, 2017. "Industries without smokestacks in Uganda and Rwanda," WIDER Working Paper Series wp-2017-12, World Institute for Development Economic Research (UNU-WIDER).

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