Abstract
This paper pore over the role of export trade incentives schemes on export performance there on Economic growth. Data used in the paper is collected from different offices and websites like Ethiopian Revenue and Customs Authority, National Bank of Ethiopia, and National Bank of Ethiopia and Development Bank of Ethiopia. Data collected is analyzed using tables and correlation analysis. The result of the study revealed that government uses Fiscal as well as financial schemes as export incentives. Following the incentives the total export value and volume of major export items is increasing from time to time. Correlation analysis result shows that export value and fiscal incentives have positive relationship whereas; the correlation between export value and financial incentives is negative. The government is expected to do more in provision of both financial and fiscal incentive schemes so as to strengthen the contribution of this sector to the economy. Keywords: Financial Incentives, Fiscal Incentive, Trade, Export, Growth , Ethiopia DOI: 10.7176/JAAS/68-06 Publication date: September 30 th 2020
Highlights
The theory of international trade is one of the oldest branches of the economic thought
4.Methodology of the study The study uses atrend analysis and correlation analysis for the period 2007/08-2011/12.To conduct this study five years time series secondary quantitative data was used and the data was collected from Ethiopian revenues and customs authority(ERCA), National bank of Ethiopia (NBE), development bank ofEthiopia (DBE) and Ministry of industry (MOI)
The Export data of the country andthe fiscal export incentive data duringthe specified period were collected from the report and data base of ERCA and NBE; data related to financial incentive was collected from NBE and DBE; fiscal incentive beneficiaries and other related data were collected from MOI and real exchange rate from NBE
Summary
The theory of international trade is one of the oldest branches of the economic thought. Exporting is a major component of the international trade. Exporting hasan important role for the growth of the economic as a whole as well as for individual firms since Mercantilist era. Increasing export is a key concern for developing countries and it boost profitability; enhances production efficiency and competitiveness, developresources utilization capacity, provide employment and improve trade balances of countries’ (Soprana, 2011) and (Hailu, 2012). There are two broad types of exporting economies: merchandise/goods export and service export. Export of a good happens when there is a change of ownership from a resident to a non-resident; this does not necessarily imply that the good physically cross the frontier. In specific cases national accounts impute changes of ownership even though in legal terms no change of ownership take place (WTO, 2010)
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