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Can Regional Integration Accelerate Development in Africa? CGE Model Simulations of the Impact of the SADC FTA on the Republic of Madagascar

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Author Info
Jean-Jacques Hallaert

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Abstract

Madagascar plans to start phasing out its customs tariffs on imports from the Southern African Development Community in 2007. This paper uses a CGE model to evaluate the impact of the SADC FTA on Madagascar economy. The results suggest that the SADC FTA would only have a limited impact on Madagascar's real GDP because the liberalization affects only a small share of its total imports. However, Madagascar's trade and production pattern would change and benefit the textile and clothing sector. Removing rigidities in the labor and capital market would increase the gains but they would remain limited. Gains from the SADC FTA become substantial only when the regional liberalization is accompanied by a multilateral liberalization.

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Paper provided by International Monetary Fund in its series IMF Working Papers with number 07/66.

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Length: 30 pages
Date of creation: 22 Mar 2007
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Handle: RePEc:imf:imfwpa:07/66

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Keywords: Trade Policy ; CGE ; Regional integration ; SADC ; Madagascar ; International trade agreements ; Madagascar ; Trade policy ; Southern African Development Community ; Africa ; Trade liberalization ; Economic models ;

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    Other versions:
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  10. Ann Harrison & Ana Revenga, 1995. "The Effects of Trade Policy Reform: What Do We Really Know?," NBER Working Papers 5225, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  11. Yongzheng Yang & Montfort Mlachila, 2004. "The End of Textiles Quotas: A Case Study of the Impact on Bangladesh," IMF Working Papers 04/108, International Monetary Fund. [Downloadable!]
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Jean-Jacques Hallaert, 2008. "How does a domestic tax reform effect protection against imports? The case of the Republic of Madagascar," IMF Working Papers 08/151, International Monetary Fund. [Downloadable!]
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