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The Transboundary Impacts of Trade Liberalization and Climate Change on the Nile Basin Economies and Water Resource Availability

Author

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  • Tewodros Negash Kahsay

    (Addis Ababa University)

  • Onno Kuik

    (Vrije Universiteit Amsterdam)

  • Roy Brouwer

    (Vrije Universiteit Amsterdam
    University of Waterloo)

  • Pieter Zaag

    (IHE Delft
    Delft University of Technology)

Abstract

A multi-country, multi-sector computable general equilibrium (CGE) model is used for the first time to evaluate the economic and water resource availability effects of trade liberalization (removal of import tariffs) and facilitation (reducing non-tariff barriers) under climate change in the Nile Basin. The analysis uses the GTAP 9 Database and the GTAP-W model that distinguishes between rainfed and irrigated agriculture and implements water as a factor of production directly substitutable in the production process of irrigated agriculture. A full trade liberalization and improved trade facilitation scenario is considered with and without climate change. The study reveals that trade liberalization and facilitation generates substantial economic benefits and enhances economic growth and welfare in the Nile basin. The effect of instituting a free trade policy on water savings is found to be limited, while climate change improves water supply and hence irrigation water use, enhancing economic growth and welfare in the basin.

Suggested Citation

  • Tewodros Negash Kahsay & Onno Kuik & Roy Brouwer & Pieter Zaag, 2018. "The Transboundary Impacts of Trade Liberalization and Climate Change on the Nile Basin Economies and Water Resource Availability," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 32(3), pages 935-947, February.
    • Handle: RePEc:spr:waterr:v:32:y:2018:i:3:d:10.1007_s11269-017-1847-7
    DOI: 10.1007/s11269-017-1847-7
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