An empirical analysis of free trade agreement on import of commodities

Africa and China, at present times, enjoy close relations in numerous areas of cooperations including trade. The Chinese government over the past years have granted trade concessions including tariff elimination to thirty (30) African countries. Hence the motivation to explore how Free Trade Agreement in import tariff of commodities and services from Africa to China can be beneficial to Africa in its quest to improve the livelihoods of its citizenry. The study had two (2) policy scenarios: firstly, an elimination of import tariffs on commodities and services imported from African countries to China and secondly, a reduction by 50% of import tariffs on commodities and services imported from Africa to China. The paper critically assessed the economic impact of both policies to empirically determine which of the policy is more beneficial to Africa. This study employed the GTAP 9A database. Data year 2011, to create regional, sectoral and factorial inputs aggregations. The simulation results indicate that the adoption of either policy scenarios will attain some beneficial economic and output variables.