Olusegun Barnabas Obasaju

Economics Department, Landmark University,

Nigeria

obasaju.barnabas@lmu.edu.ng

Does intermediate tariff bode well for trade integration in ECOWAS?

Wumi Kolawole Olayiwola

Economic Policy Analysis Unit, ECOWAS Commission,

Nigeria

kolayiwola@gmail.com

Henry Okodua

Economics Department, Covenant University,

Nigeria

henry.okodua@covenantuniversity.edu.ng

Ruth Uzoaku Obasaju

Economics Department, Kwara State University,

Nigeria

ruthobasaju@gmail.com

Abstract. This paper analyses the impact of intermediate tariffs on intraregional intermediate exports within the Economic Community of West African States (ECOWAS) from 2000 to 2015. This is in order to investigate whether or not the levels of intermediate tariffs bode well for trade integration in ECOWAS. Using the Heckman Two-step technique, the empirical estimates reveal that the similarities in GDP and the presence of the West African Economic and Monetary Union (WAEMU), among others, are highly significant determinants of intraregional intermediate exports in ECOWAS. Contrarily, the quality of institution and the levels of intermediate tariffs are not important contributors to intraregional exports of intermediates. As the continent prepares towards the implementation of the African Continental Free Trade Area and considers regional value chains quintessential to development, policy makers should be informed of the unsupportive levels of intermediate tariffs in ECOWAS- a regional economic community that accounts for about thirty percent of the African population. Trade policies targeted at lowering intermediate tariffs within ECOWAS are called for.

Received: July, 2018

1st Revision: August, 2018

Accepted: November, 2018

DOI: 10.14254/2071-8330.2018/11-4/14

JEL Classification: F10, F13, F14, F15, C30, C33

Keywords: intermediate tariffs, trade integration, regional value chains, Heckman two-step, ECOWAS