Utilization of the Gravity Model of Trade to Measure the Determinants of Egypt's Agricultural Exports to the Gulf Cooperation Conncil Countries | ||
| Alexandria Science Exchange Journal | ||
| Article 25, Volume 42, Issue 3, September 2021, Pages 1647-1666 PDF (609.1 K) | ||
| Document Type: Original Article | ||
| DOI: 10.21608/asejaiqjsae.2021.191174 | ||
| Author | ||
| sameh Mohamed Shehab* | ||
| Department of Economics and Agricultural Business Administration, Faculty of Agriculture, Alexandria University. | ||
| Abstract | ||
| The study aimed to measure the most important determinants affecting the flow of Egypt's agricultural exports to the Gulf Cooperation Council countries using the gravity model as one of the standard models that explain the growth of exports through economic factors represented in the gross domestic product, geographical factors represented by distance, in addition to human factors represented in the population of the country Exporting and importing countries. The obtained data revealed that Egypt’s agricultural exports amounted to about $21.935 billion during the average period 2015-2019, as the food industries sector, agricultural crops, and textile sector represent about 14.22%, 10.16%, and 3.95%, respectively. The group of Arab countries ranked first for countries importing from Egypt by about 40.42%, as the value of Egypt's agricultural exports to the Gulf Cooperation Council countries, which are represented in Saudi Arabia, UAE, Kuwait, Oman, Bahrain during the average period 2005-2019, amounted to about 494.295 million dollars, with an annual growth rate of about 12.9%, 13.4%, 11%, 13.3% and 19.4%, respectively. The findings of estimating the Gravity Model of Egypt's agricultural exports using the Pooled Regression model (PRM) showed that there is a positive relationship with the size of the GDP of the exporting country and the Gulf Cooperation Council countries, whereas it was found that there is an inverse relationship with the distance. It was also detected that the Random Effect Model (FEM) was weighted to estimate the gravity model based on the Hausman test (1987) where the results showed the positive effect of GDP, with the negative effect of the distance variable not significant, while the negative impact of the population for Egypt was shown, which provide a productive surplus for external export, and the positive impact of the population of importing countries, which gives an increase in the volume of external demand for Egypt's agricultural exports. From the foregoing, it is clear that by increasing the national income and the proximity of the distance, the external demand for Egyptian agricultural commodities increases, and then the research recommends to increase the growth of Egypt’s agricultural exports focus on high-income countries, with geographical proximity, and transform the relationship between Egypt and the Arab world and strategic partners from traditional cooperation based on import and export to build a strategic relationship in the field of sustainable food security. | ||
| Keywords | ||
| gravity model; Haussmann test; random effect model; Egypt's agricultural exports; Gulf Cooperation Council | ||
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