Trade Infrastructure and Export Competitiveness in the East African Community

Abstract

The purpose of this paper is to examine the influence of trade infrastructure components: port infrastructure, telephone usage and electricity on the export competitiveness of firms in the East African Community (EAC). The study adopted the structural gravity model and the Poisson Pseudo Maximum Likelihood (PPML), a nonlinear estimation method that was applied in STATA on balanced panel data for the period of 2007 to 2018.  Data was obtained from World Bank International Trade Centre (ITC) and World Bank development indicators. Results show that telephone usage, electricity and port infrastructure are positive and significant predictors of export competitiveness in East African Community partner states. The results of this study show that electricity usage, telephone usage and port infrastructure are important contributors to improving export competitiveness in the EAC. There is a need to examine the intricate nature of the EAC economy in order to further this study’s findings.  The EAC partner states need to 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 economic policies and regulations can be implemented through mutual recognition agreements where countries agree to recognize one another’s conformity assessments.