DETERMINANTS OF EXPORT DIVERSIFICATION IN GHANA
Date
2019-04-22
Authors
GBOLONYO, EMMANUEL YAO
Journal Title
Journal ISSN
Volume Title
Publisher
University of Cape Coast
Abstract
The present study examines the determinants of export diversification in Ghana.
For this purpose, Theil index is used to estimate the degree of export diversification.
The study used annual time series data from 1983 to 2016 to estimate the structural,
economic/policy and macroeconomic determinants of export diversification within
the Auto Regressive Distributed Lag (ARDL) framework. The results of this study
indicated that GDP per capita, real effective exchange rate, trade openness, foreign
direct investment and infrastructure, improve export diversification in both the
long-run and short-run while terms of trade enhances specialisation. Based on the
findings of this study, the study recommended that government should take
advantage of the fall in Cedi value by exporting more products to markets with high
demand. The Ministry of Trade and Industry should also develop a competitive
capacity for trade in order to eliminate principal domestic barriers to international
business development, increase its investment in basic and trade-related
infrastructure. It is also recommended that the government through the Ghana
Investment Promotion Center should invest in promoting a broader variety of FDI
opportunities to investors, while also developing other sectors of the economy in
order to boost diversification.