The Determinants of Export Performance in East African Countries: A Panel Data Approach

The paper examines the effect of demand and supply side factors on East Africa countries total, agricultural raw materials, service and manufacture export performance. Thus, both internal and external aspects are responsible for poor export performance in the region. The study employed a penal data to empirically analysis these determinants in East Africa for the periods 2005 to 2014. A Sample of 7 countries from the region was selected for analyze the determinants of the exports of total, agricultural raw materials, service and manufacture based on the standard international trade classification. Based on the Hausmanestimate the total and agricultural export fixed effect model is appropriate whereas for service and manufacture export random effect model is fitted. Using the first model (fixed effect) we found that the police related to FDI and trade openness have impact on the total export performance in the region. And for model two (fixed effect) the agricultural raw materials export performance in this region is not influenced as the expected theoretical. Using random effect in the model of service sector human capital and foreign direct investment net inflow are the major factors to improve the service and manufacture sector export performance in the region. Moreover, except the agriculture raw material export the supply and demand sides'factors are found the major determinants of the total, service and manufacture export performance in the region.