Trade Openness and Competitiveness: BRICS and Sub-Saharan Africa Countries

Abstract

The aim of this study is to highlight the key competitiveness elements that promote trade flows between the BRICS countries of Brazil, Russia, India, China and South Africa and those in Sub-Saharan Africa. To do so, we employ the econometrics of panel data during the period of study from 1995 to 2018. We apply the Blundell and Bond GMM estimator [1998] and we utilize Sargan’s [1958] over-identification test to confirm the validity of delayed variables in level and difference as instruments used in our estimations. The empirical findings of our study show that trade policy actions, high natural resource allocation and the evolution of gross domestic product (GDP) per capita of the participating countries promote this trade openness between BRICS and Sub-Saharan Africa economies. Additionally, African countries need to develop their industrial sector to export more high-value manufactured products.