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Is Kenya Facing East or West: An Empirical Analysis

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  • X.N. Iraki

Abstract

In the last two decades China’s economic influence in Africa has increased espoused by huge investment in infrastructure like roads, railways, airports and seaports. This has led many scholars to suggest that Africa is facing East away from the traditional West. The Western influence had permeated into governance, education religion and even consumption. Of interest is if China has successfully displaced the west from Africa in such a short time. This study investigates if Africa, in particular Kenya has really faced East (read China). We expect economies near each other geographically or are culturally close because of history e.g. colonialism to have highly correlated GDP growths. This is supported by gravity theory of trade. In this paper, GDP growth rates of Kenya and a selected number of countries from the West and East are correlated for a 50 years period. Analysis is then broken into decades to see the change in patterns. Analysis of correlations during the different Kenyan presidencies then before and after the cold war is carried out. All the data in this paper is sourced from World Development Indicators, a World Bank Data base. The hype about facing East for Kenya is not supported by data. Kenya in the last 20 years has looked East, but did not abandon the West. This dualism may change with Brexit, Trump in White House and envisaged Africa’s free trade area.

Suggested Citation

  • X.N. Iraki, 2018. "Is Kenya Facing East or West: An Empirical Analysis," International Business Research, Canadian Center of Science and Education, vol. 11(12), pages 134-144, December.
    • Handle: RePEc:ibn:ibrjnl:v:11:y:2018:i:12:p:134-144
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    References listed on IDEAS

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    1. repec:hal:spmain:info:hdl:2441/6k7m0q7h709rdrhbpm2n96irf8 is not listed on IDEAS
    2. Thomas Chaney, 2018. "The Gravity Equation in International Trade: An Explanation," Journal of Political Economy, University of Chicago Press, vol. 126(1), pages 150-177.
    3. Glick, Reuven & Rose, Andrew K., 2002. "Does a currency union affect trade? The time-series evidence," European Economic Review, Elsevier, vol. 46(6), pages 1125-1151, June.
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    6. Magnus Blomstrom & Robert E. Lipsey & Lennart Ohlsson, 1989. "What Do Rich Countries Trade with Each Other? R&D and the Composition of U.S. and Swedish Trade," NBER Working Papers 3140, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Kenya: Kenya and South Africa Are Working to Address Trade Barriers
      by ? in Whats New on 2023-01-16 15:51:38

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    More about this item

    Keywords

    Kenyatta; China; Kenya; Brexit; Africa Free Trade Area;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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