Africana Periodical Literature 
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| Title: | Trade liberalization and Egypt's industry: a CGE analysis |
| Author: | El-Said, Moataz |
| Year: | 1994 |
| Periodical: | L'Égypte contemporaine |
| Volume: | 85 |
| Issue: | 437-438 |
| Pages: | 159-204 |
| Language: | English |
| Geographic term: | Egypt |
| Subjects: | econometrics industry trade policy |
| Abstract: | One of the major components of Egypt's economic reform programme is the adoption of an outward-looking trade strategy. The present paper undertakes a quantitative examination of the impact of this shift in trade policy on Egypt's industrial sector. A set of policy experiments employing a Computable General Equilibrium (CGE) model and data derived from the 1986-1987 Social Accounting Matrix (SAM) simulate changes in trade policy under a fixed and a flexible exchange rate. In light of the results, questions at the macro and micro level are addressed and the policy trade-offs are highlighted. The findings indicate that under both fixed and flexible exchange rates the removal of tariff protection has a negative impact on government savings, the trade deficit increases, and real investment demand does not change or increases by 1.3 percent. Under most of the policy experiments, Egyptian industrial sector value added is negatively affected. When the exchange rate is devalued, the ratio of imports to output declines, implying a gain in the domestic market. At the same time, the ratio of exports to output increases, reflecting an increase in industrial sector exports. However, there are trade-offs associated with these gains: investment, GDP and employment suffer. Bibliogr., notes, ref. |