Did the Customs Union of the East African Community Increase Overall Trade of Kenya, Tanzania and Uganda?

  • David Stadelmann University of Bayreuth
  • Raymond Boadi Frempong University of Bayreuth

Abstract

We investigate the effect of the customs union of the East African Community (EAC) on overall trade per capita for its founding members Kenya, Tanzania and Uganda employing a synthetic control group as a counterfactual parameter. We do not find any systematic evidence that the customs union affected overall trade per capita for the founding members. Robustness and placebo tests support our main empirical findings. We briefly discuss potential reasons why the EAC
customs union may not have contributed to increasing overall trade for its founding members and stress that further evidence is required to draw definitive policy conclusions.

Key words: East African Community, customs union, regional trade, trade growth, synthetic control method

Author Biographies

David Stadelmann, University of Bayreuth

Professor David Stadelmann is the holder of the Chair of Development Economics at the University
of Bayreuth and a research fellow at the Center for Research in Economics, Management, and the
Arts, Zurich, Switzerland, (Email: david.stadelmann@uni-bayreuth.de).

Raymond Boadi Frempong, University of Bayreuth

Dr Raymond Boadi Frempong is a postdoctoral researcher at the University of Bayreuth, Chair of

Development Economics (Email: raymond.frempong@uni-bayreuth.de). His position is currently fi-
nanced by the Deutsche Forschungsgemeinschaft (DFG, German Research Foundation) under Ger-
many’s Excellence Strategy – EXC 2052/1 – 390713894.

Published
2020-02-08