Exchange rate management and manufactured exports in Sub-Saharan Africa

The Real Exchange Rate, the Ghanaian Trade Balance, and the J-curve

“…If a country's real exchange rate experiences depreciation, other factors unchanged, her goods and services become cheaper relative to those of her trade partners. Therefore, the country should experience a surge in its exports (see Sekkat and Varoudakis, 2000). In contrast, if the real exchange rate appreciates, then the country's goods and services become expensive, leading to a surge in her imports (Salehi-Isfahani, 1989).…”

Exchange Rates and Export Competitiveness in Selected ASEAN Economies

“…Some have even argued the possibility that exchange rates in the Asian emerging economies have been deliberately undervalued in order to increase the competitiveness of export (see for example Montiel 1997, Benaroya andDidier Janci 1999). Several studies have shown that exchange rate management matters for export performance (Edwards 1988, Paredes 1988, Cottani et al 1990, Ghura and Grennes 1993, Sekkat and Sapir 1995, Elbadawi 1998, Sekkat and Varoudakis 2000. Sekkat and Varoudakis (2000) showed that countries which have successfully promoted manufactured exports experienced real exchange rate (RER) depreciation, leading to a significant increase in the domestic relative price of tradables to non-tradable.…”

“…Sapir and Sekkat (1995) showed that the impact of RER, RER volatility and misalignment vary across different sectoral levels and exchange rate regimes. Sekkat and Varoudakis (2000) extended the work of the above-mentioned studies by incorporating two more exchange rate policy indicators, namely RER volatility and RER misalignment. The study used sectoral level information, that is, three manufacturing sectors (textile, chemicals and metals) under different exchange rate regimes (fixed and floating).…”

“…On the other hand, it is easy to establish correlation between misalignment and export because misalignment represents an uncertainty against which there is little possibility of insurance (Sekkat and Varoudakis 2000). The results for developing countries have also been mixed.…”

Export Diversification in Low-Income Countries

“…See, in particular, Elbadawi (2001) and Sekkat and Varoudakis (1998) on the negative impact of exchange-rate misalignment on the competitiveness of manufactured exports. Lederman and Xu (2001) and Collier (2002) provide additional evidence on a variety of factors affecting a country's trade structure.…”