THE PERFORMANCE OF FOREIGN TRADE: THE PALESTINIAN CASE COMPARED WITH A SELECTED MIDDLE EAST COUNTRIES (PANEL ANALYSIS)

Gaber ABUGAMEA

This paper examines the performance of external merchandise trade for a selected group of Middle East Arabian countries. This group includes Algeria, Egypt, Jordan, Morocco, Palestinian areas in West Bank and Gaza Strip, Saudi Arabia, Syria and Tunisia. Taking into account the role of exports for numerous economic considerations, it traces the main factors impacted these exports over the past three decades. Using trade ratio (exports expressed in terms of imports) as a measure for exports throughout specific export supply function, it relates trade to economy activity (gross domestic of production), competitiveness issue and investment-technology measure. By employing traditional panel analysis techniques, Fixed-effects-Random effects procedures it highlights the heterogeneity among these countries. Generally, while gross domestic of production was found with a significant positive impact on exportable, however raw material-commodities especially oil and oil products shaped that impact. In addition, mix results was captured for the impact of liberal policies followed by some countries since the late 1980s, on performance of trade. Also it was appeared that competitiveness was continuing a matter for many countries where we have negative impact of misalignment of exchange rates on exportable for a pool system. Distinctly, this study concludes the deficiencies for Palestinian trade in the absence of independent policies, a situation wherein, the Palestinian Territories in the West Bank and Gaza Strip experienced the impact of compulsory integration with Israel.