摘要：Does Foreign Aid inflow matter in West African Monetary Zone (WAMZ)? Data from World Bank were sourced from 1970-2017. This study examined the long-run impact of ODA on trade volume in selected WAMZ. The study adopted Shin, Yu, and Green-wood (2011) NARDL framework to study the implication of both increase in ODA inflow and decrease in ODA inflow. The study found that ODA has negative impact on trade in WAMZ. Specifically, both increase in ODA inflow and decrease in ODA inflow on trade in WAMZ were negative. However, the bound test showed that long-run relationship exist between ODA and trade in WAMZ. Also, the speeds of adjustment were negative and statistically significant at 5 percent. The result implies that dependence on ODA inflows could distort trade volume, in spite of the existing long-run relationship, ODA do not reduce cost of trade in WAMZ, hence the negative impact on trade. To achieve expanded trade growth, to improve the capacity of WAMZ to earn foreign exchanges, and to gain market share in the global trade, WAMZ should design policy to tap into its local raw materials, pursue inclusive and sustainable diversification. Lastly, WAMZ trade must be based on raw materials for both imports and exports until strategic and responsible attempts are taken to accelerate local productive capacity to produce and incentivise domestic capacity to trade at the global market.
关键词：African Continental Free Trade Agreement; Aid for Trade; Trade robustness; Foreign Aid; and Non-linear Autoregressive Distributed Lag (NARDL)
