Effect of the African growth and opportunity act on the structure of public revenue in Sub-Saharan Africa
摘要
The present analysis investigates the effect of both the eligibility for the African Growth and Opportunity (AGOA) programme, and the suspension of the benefits associated with this programme on the total public revenue and its structure in beneficiary (and suspended) Sub-Saharan African countries. The analysis uses the Entropy Balancing approach over the annual period from 1996 to 2022. It has shown that the AGOA programme has helped improve total public revenue, which reflects essentially an increase in resource-based public revenues in both ‘never’ suspended resource-rich countries and ‘at least once’ suspended countries, and an increase in non-resource based public revenues in ‘never’ suspended non-resource-rich countries. Export product diversification and manufactured export performance act as mediators of the effect of the AGOA programme on public revenue indicators in ‘never’ suspended AGOA beneficiary countries. In addition, the public revenue effects of the programme appear to be dependent on beneficiary countries’ export intensity under the AGOA programme. Finally, the AGOA suspension results in the fall in total public revenue, including resource revenue and trade tax revenue, but it leads suspended countries to improve the mobilization of non-resource tax revenues. Overall, non-reciprocal trade preferences (here, the AGOA programme) affect total public revenue, and alter its composition in beneficiary countries. Furthermore, the greater mobilization of non-resource tax revenue implied by the AGOA suspension does not make up for the resource revenue losses due to the programme suspension. These findings point to the vulnerability of public revenues to the uncertainty surrounding non-reciprocal trade preferences such as the AGOA programme.