An Empirical Analysis of Determinants of Swazilands Export Performance

Sipho V. Skosana, Francois I Kabuya


The purpose of this study is to identify the fundamental factors that are key determinants in promoting the Swaziland export performance from 1980 to 2010. The study uses the cointegration technique to estimate both long run and short-run relationships among the variables under investigation and undertakes estimations in the error-correction model approach. The study found that foreign direct investment (FDI), world demand, and nominal exchange rate were key significant factors in determining the export performance at 1 per cent (p < 0.01) in the long run with elasticities of 0.58, 1.19 and 0.36 respectively, and at 5 per cent (p < 0.05) in the short run with coefficients of 0.26, 4.3 and 0.5, respectively. The real GDP and domestic demand have no statisticaleffect on Swazilands export performance. The error correctional model was -0.372 that captured the speed of error correction. A conducive investment environment should remain an agenda setting in the pro-trade policy making process for the Swazi policy makers.


Cointegration; determinants; exchange rate; export; foreign direct investment

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