Market Implications of COMESA's Accession to the Free Trade Area: A Gravitational Investigation

Abstract

This paper derives and uses a variant of the gravity model to assess the market implications of the COMESA's accession to the Free Trade Area. The results show that the traditional explanatory variables of the gravity model are the significant determinants of trade flows in the COMESA region, and that belonging to this grouping fosters trade. Hence policy advice should focus on strengthening these factors, which are likely to enhance the possibility of greater intra-regional trade. This can contribute to drawing foreign direct investment to the region, enhancing policy credibility, and bringing greater economic and political stability. This paper also highlights the importance of a combination of unilateral and preferential economic reforms in the preferential trade arrangements in sub-Saharan Africa.