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From Bilateral Trade To Multilateral Pressure: A Scenario Of European Union Relations With Sudan

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Listed:
  • KHALID H. A. SIDDIG

    (University of Khartoum, Sudan;
    Agricultural and Food Policy Group, Hohenheim University, Germany;
    Erisdorfer Str. 66, 70599 Stuttgart, Germany)

Abstract

This paper investigates the economic consequences of a scenario in which the European Union (EU) imposes economic sanctions on Sudan. The idea of the paper is motivated by the deteriorating relations between Sudan and the EU arising from the devastating conflicts in Darfur region and related implications involving the International Criminal Court (ICC). Another factor supporting the idea is the U.S. encouragement of multilateral pressure on the country to change the behavior of the government. The global CGE (Computable General Equilibrium) model of GTAP (Global Trade Analysis Project) and its Africa Database is employed in this paper. The simulation bans importation into the EU from Sudan as well as exportation to Sudan from the EU. The results suggest that both income and expenditure of the Sudanese GDP will decline due to sanctions. The trade balance will witness a surplus due to the big decline in the country's imports, as all imports will fall. However, the major impact is coming from the decreasing EU-sourced imports like light manufacturing, petroleum-coal products, and heavy manufacturing, which represent big shares in the total Sudanese import value. While Sudan is the clear loser, the results show that the East Asian countries, led by China, will gain in this situation. Most of Sudanese trade with the EU seems to be shifting to these countries. However, the 'Rest of Africa' region does not have any welfare losses, while it has gains in some sectors. Domestic output in MENA, Egypt, Kenya, and Ethiopia in some sectors will fall due to the EU sanctions on Sudan, reflecting the regional dimension that sanctions can have.

Suggested Citation

  • Khalid H. A. Siddig, 2011. "From Bilateral Trade To Multilateral Pressure: A Scenario Of European Union Relations With Sudan," Middle East Development Journal (MEDJ), World Scientific Publishing Co. Pte. Ltd., vol. 3(01), pages 55-73.
    • Handle: RePEc:wsi:medjxx:v:03:y:2011:i:01:n:s1793812011000326
    DOI: 10.1142/S1793812011000326
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    1. Brockmeier, Martina, 2001. "A Graphical Exposition Of The Gtap Model," Technical Papers 28706, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    2. Adhana Tekle, Kelali, 2006. "Impact of FTA within Eastern and Southern Africa Countries and Unilateral Tariff Elimination by other Regions," Conference papers 330236, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    3. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
    4. Villoria, Nelson, 2008. "Estimation of Missing Intra-African Trade," GTAP Research Memoranda 2915, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    5. Brockmeier, Martina, 2001. "A Graphical Exposition of the GTAP Model," GTAP Technical Papers 311, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
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    Cited by:

    1. Siddig, Khalid & Grethe, Harald & Abdelwahab, Noura, 2016. "The natural gas sector in post-revolution Egypt," Journal of Policy Modeling, Elsevier, vol. 38(5), pages 941-953.
    2. Mohammad Reza Farzanegan & Mohammad Mohammadikhabbazan & Hossein Sadeghi, 2015. "Effect of Oil Sanctions on the Macroeconomic and Household Welfare in Iran: New Evidence from a CGE Model," MAGKS Papers on Economics 201507, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    3. Chen, Yin E. & Fu, Qiang & Zhao, Xinxin & Yuan, Xuemei & Chang, Chun-Ping, 2019. "International sanctions’ impact on energy efficiency in target states," Economic Modelling, Elsevier, vol. 82(C), pages 21-34.

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