Analysis of Burundi’s trade flows in selected food commodities in East African Community, 2003-2018

Burundi integrated into the East African Community (EAC) in 2007. Since then, trade flows in food commodities has not been given adequate attention in empirical analysis. Few studies done neither focused on bilateral trade flows at commodity level nor identified which country Burundi intensively trades with. Hence, this study was carried out to bridge that gap left by previous studies. Furthermore, it was meant to provide a quantitative information regarding food trade between Burundi and other EAC countries. Specifically, this study characterized the evolution of the patterns of food trade between Burundi and other EAC countries, determined the intensity of food trade and estimated the factors which affect food trade between Burundi and other EAC partner states. To meet these objectives, both descriptive and explanatory design were used. First of all, this study critically analyzed the trends of the patterns of food trade and determined the intensity of food trade between Burundi and other EAC countries. Thereafter, a gravity model was applied to estimate the factors which influence Burundi’s food trade with other EAC countries. Before embarking on data analysis, the tests related to the nature of the data used and other tests were performed in order to prevent from obtaining biased estimates. Therefore, the data was tested for stationarity and multicollinearity. In addition, provided that this study used panel data, a Haussman test was used to choose between random and fixed effect models. This study which was limited in time (from 2003 to 2018) involved five EAC countries namely Burundi, Kenya, Uganda, Tanzania and Rwanda. Moreover, only four food commodities suchlike maize, rice, sugar and wheat were concerned. The results indicated that there has not been such a significant increase in the patterns of food trade as a result of Burundi’s integration into the EAC. Furthermore, the results showed that Burundi remained a net food importer with few quantities of maize, rice, sugar and wheat exported to other EAC countries. The results clearly evidenced that among other EAC countries, Burundi intensively imported food commodities from Uganda followed by Tanzania. However, it was noted that sugar imports were relatively more intensive with Kenya. The results particularly pointed out that Burundi did not intensively import food commodities from Rwanda. Lastly, the findings revealed that the GDPs, the exchange rates and the distance were the major factors which statistically influenced food trade. Other factors like trade openness and infrastructure development indices influenced trade depending on the commodity and the direction of trade (either imports or exports). Thus, Policy makers in Burundi should set relevant policies to efficiently optimize food trade between Burundi and other EAC countries.