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Determinants of bilateral trade between China and Africa: a gravity model approach

Author

Listed:
  • Zhijie Guan
  • Jim Kwee Fat Ip Ping Sheong
Abstract
Purpose - The main purpose of this paper is to analyse the different factors affecting Sino-African trade based on the gravity model, and propose some solutions to improve the problems. Design/methodology/approach - The paper is based on an extended gravity model, including trade agreement and recession as explanatory variables. The impacts of trade agreement and economic recession on Sino-African imports and exports are examined. Findings - The results show that the product of GDP affects African exports to China significantly and negatively, and affects African imports from China positively. Real exchange rate affects African exports to China positively, and affects African imports from China negatively. Population affect African exports to China significantly and positively, and affect African imports from China positively. Recession have negative effects on both African imports from China and exports to China but is only significant for imports. Agreement affects African imports from China and exports to China positively. Our findings confirm the impact of economic recession, and imply that the structure of African product exported to China should be improved, and trade agreements should be reinforced. Originality/value - This paper contributes and extends the literature on Sino-African trade by improving the traditional gravity model to include the impact of all trade agreements, and their aggregating effects on trade. The paper also seeks to assess the trade impact of economic recession through a dynamic gravity model approach for which there has been no research done to our knowledge. In this regard, it provides new understanding of the trade pattern between China and Africa, and ways in improving the Sino-African bilateral trade.

Suggested Citation

  • Zhijie Guan & Jim Kwee Fat Ip Ping Sheong, 2020. "Determinants of bilateral trade between China and Africa: a gravity model approach," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 47(5), pages 1015-1038, April.
    • Handle: RePEc:eme:jespps:jes-12-2018-0461
    DOI: 10.1108/JES-12-2018-0461
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    Cited by:

    1. Ercan Yasar & Güray Akalin & Sinan Erdogan & Samuel Asumadu Sarkodie, 2022. "Trading Kuznets curve: empirical analysis for China," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 49(3), pages 741-768, August.
    2. Weibing Chen & Bian Wu & Qing Guo, 2024. "The efficiency of China's export trade with Africa and its influence mechanism," African Development Review, African Development Bank, vol. 36(2), pages 187-200, June.
    3. David Landry, 2024. "Does governance matter? Comparing the determinants of Chinese and Western trade with Africa," Global Policy, London School of Economics and Political Science, vol. 15(2), pages 342-354, May.

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    More about this item

    Keywords

    Gravity model; Determinants; Sino-African; Trade; Trade agreements; Recession; F13; F14; O55; P45;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • P45 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - International Linkages

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