Does Aid for Trade Enhance Exports by Kenya in COMESA

Abstract

There is limited empirical evidence that establish a link between aid for trade and trade outcomes between the countries receiving aid. This study examine whether aid for economic infrastructure, and policy and regulatory reforms affect trade by Kenya to COMESA countries. Using an augmented gravity model, the study find both aid categories to increase exports. Aid for economic infrastructure is economically significant even when aid for policy is absent. While aid for economic infrastructure positively complement aid for policy and regulations. The policy implication is that donors should provide both categories of aid to promote regional trade.

Keywords: Aid for Trade, Trade Facilitation, Infrastructure, Policy and Regulations, International Trade, Common Market of Eastern and Southern Africa (COMESA),

DOI: 10.7176/JESD/11-12-11

Publication date:June 30th 2020