The Interrelationship Between Controlled and Uncontrolled Factors Affecting The Percentage of Value Added of Wheat To GDP In Egypt

Abstract

Agriculture had been the essence of the Egyptian economy but recently it had been facing a major decline in its value-added GDP going from 30% to 12% in the year 2016. The cause of this was believed to be due to the agricultural policies that have focused on the production of the local market in the short-term and neglected the long-term aspects and dimensions. This had led the Egyptians to move towards urbanization, which has a growth rate of 22%. However, this shift had affected one of the major strategic crops in the country. This is the wheat agriculture whose importance shows through the wheat consumption-GDP ratio which was about 1.66%, making it the first among all other significant crops. On the other hand, it is noticed that there is a huge gap between the wheat production and wheat consumption in Egypt that is due to the large purchases of imported wheat where Egypt is considered the world's largest wheat importer. This affects both the trade balance as well as the foreign net reserves that the country possesses because of issues with wheat production and economic instability, A wheat production model using Econometrics is being prepared to assess whether the stated variables have a significant impact. Our assumption in this paper is based on the economic theory, we built the multiple regression model by first changing the verbal equation into a simpler, verbal error-free equation, we carried out the work by using the science of “Econometrics” to interpret the reality of the relationship of different variables we will determine in paper to wheat production. This is done by knowing the values of the parameters of each independent variable to be then known as coefficients.