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The Role of Customs Policy in Maximizing the Benefits of Economic Blocs: The Case of Egypt

Author

Listed:
  • Mahmoud Magdy Barbary

    (Department of Finance, College of Business Administration in Hawtat Bani Tamim, Prince Sattam Bin Abdulaziz University, Al Hulwah 16524, Saudi Arabia
    Department of Economics and Foreign Trade, Faculty of Commerce and Business Administration, Helwan University, Cairo 4034572, Egypt)

  • Abdalla Ramadan Tawfiq

    (Department of Economics and Foreign Trade, Faculty of Commerce and Business Administration, Helwan University, Cairo 4034572, Egypt)

Abstract

This study aims to examine the relationship between customs policy and the economic blocs of which Egypt is a member, with a focus on the theory of New Regionalism and modern trends in customs policies. Egypt joined numerous economic blocs following its accession to the world trade organization (WTO) in 1995, yet this membership has not yielded significant positive impacts on the performance of Egyptian exports or the trade balance. The study utilized panel data analysis of Egypt’s international trade from 2001 to 2023. The results indicate that, despite Egypt’s limited success in reaping the benefits of most economic blocs, largely due to the concentration of Egyptian exports in primary and agricultural products and the low tariff rates, factors such as customs clearance processes, tariff barriers, non-tariff barriers, regional trade agreements, and technology adoption still play a crucial role in influencing trade volume among member countries. The findings highlight the significance of effective customs procedures and the reduction of trade barriers in boosting trade volumes within regional trade agreements. The study proposes a strategy for Egypt’s customs policy to maximize benefits from economic blocs, focusing on four key areas: aligning customs policy planning with targeted export sectors to realize trade creation and trade diversion effects; fully implementing trade facilitation programs and liberalizing customs policy procedures; adopting a national strategy to stimulate high value-added export industries as a long-term solution; and adopting regional trade agreements that support cumulative origin as a short-term solution.

Suggested Citation

  • Mahmoud Magdy Barbary & Abdalla Ramadan Tawfiq, 2024. "The Role of Customs Policy in Maximizing the Benefits of Economic Blocs: The Case of Egypt," Economies, MDPI, vol. 12(9), pages 1-19, September.
    • Handle: RePEc:gam:jecomi:v:12:y:2024:i:9:p:237-:d:1471542
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    References listed on IDEAS

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    1. Shang-Jin Wei & Jeffrey A. Frankel, 1998. "Open Regionalism in a World of Continental Trade Blocs," IMF Staff Papers, Palgrave Macmillan, vol. 45(3), pages 440-453, September.
    2. Richard E. Baldwin, 2011. "Multilateralising Regionalism: Spaghetti Bowls as Building Blocks on the Path to Global Free Trade," Chapters, in: Miroslav N. Jovanović (ed.), International Handbook on the Economics of Integration, Volume I, chapter 2, Edward Elgar Publishing.
    3. Caroline Freund & Diana Weinhold, 2002. "The Internet and International Trade in Services," American Economic Review, American Economic Association, vol. 92(2), pages 236-240, May.
    4. Kimberly A. Clausing, 2000. "Customs Unions and Free Trade Areas," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 15, pages 418-435.
    5. Olivier Cadot & Mariem Malouche & Sebastián Sáez, 2012. "Streamlining Non-Tariff Measures : A Toolkit for Policy Makers," World Bank Publications - Books, The World Bank Group, number 6019, April.
    6. Baier, Scott L. & Bergstrand, Jeffrey H., 2007. "Do free trade agreements actually increase members' international trade?," Journal of International Economics, Elsevier, vol. 71(1), pages 72-95, March.
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    Cited by:

    1. Olena Sidelnuk & Oleksandra Oliinyk, 2025. "The Impact of Customs and Tax Policy on the State's Financial Security," Oblik i finansi, Institute of Accounting and Finance, issue 3, pages 149-157, September.

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