An Empirical Evaluation of the Bilateral Non-oil Export Trade Balance between Nigeria and Egypt ....
The exchange of goods between two countries to facilitate trade and investment is known as bilateral trade. To promote trade and investment, the two countries will lower or abolish tariffs, import limits, export restrictions, and other trade barriers. The Marshall-Lerner (M-L) situation, which is fundamental to the elasticities approach to trade balance. The situation helps to clarify what happens to a country's current-account balance when the currency is devalued. An empirical analysis of the validity of the M-L Situation in the Bilateral Non-Oil Export Trade Balance between Nigeria and Egypt from 1980 to 2018 was performed in this report. The short and long run parameters were both estimated using the distributed lag (DL) mechanism. The findings confirmed the M-L Condition in short and long-term trade ties with Egypt, as well as the fact that the M-L Condition is backed up by evidence. The study recommended, among other things, that before implementing any devaluation policy, Nigeria must first ensure a significant increase in non-oil exports relative to imports. This is the only way to ensure that the country's benefits are maximised.
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