Abstract
PurposeThe purpose of this paper is to examine the influence of export logistics components: shipment arrangements, timely delivery, customs quality, trade infrastructure, and tracking and tracing on export competitiveness of firms in the East African Community (EAC).Design/methodology/approachThe study adopted the Structural Gravity Model and the Poisson pseudo-maximum likelihood (PPML). PPML a nonlinear estimation method was applied in STATA on a balanced panel data for the period of 2007–2018. Data were obtained from World Bank International Trade Centre (ITC), World Bank Logistics Performance Index (LPI) and World Bank development indicators.FindingsResults show that timely delivery and tracking and tracing of exports are positive and significant predictors of export competitiveness in EAC countries. Conversely, shipment arrangements, customs quality and trade infrastructure have no influence on export competitiveness.Research limitations/implicationsThe results of this study show that export logistics components of shipment arrangements, customs quality and trade infrastructure do not matter at the present in improving export competitiveness in the EAC. There is a need to examine the intricate nature of the EAC economy to further this study's findings.Practical implicationsThe EAC partner states should embrace deep integration by removing the behind the border trade barriers in addition to other trade restrictions, to create a common economic space among member states. This will further shrink the delivery time and the tracking and tracing of exports hence improving the competitiveness of EAC exports within the region and outside. Also, common and harmonized trade policies and regulations should be implemented through mutual recognition agreements where countries agree to recognize one another's conformity assessments.Originality/valueThis study explains the complex dynamic interactions of export logistics factors in the EAC using quantitative data and that this interaction has an effect on the export competitiveness in import-dominated countries with less harmonization in their trade policies.
Highlights
A country’s level of export competitiveness is crucial for its effective participation in international trade and eventual management of balance of trade distress (Eberhard-Ruiz and Calabrese, 2018)
This study was conducted to investigate the effect of export logistics components on the export competitiveness of firms in the East African Community (EAC)
This study was motivated by the low level of export competitiveness of export firms in EAC partner states especially for manufactured goods due to the low levels of product transformation and poor or lack of value addition
Summary
A country’s level of export competitiveness is crucial for its effective participation in international trade and eventual management of balance of trade distress (Eberhard-Ruiz and Calabrese, 2018). The contemporaneous escalation of globalization, liberalization of trade and financial services, intensification of world trade flows, the emergence of new competitors and increased foreign direct investment have created stiff competition for exporting firms in both domestic and foreign markets (Klaus, 2017). Thereupon, this has increased export competitiveness more so for developing countries and import-dominated countries such as East African Community (EAC) countries. Export-led economic growth is an important avenue of promoting economic growth in developing countries (Hakobyan, 2017)
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