Analysis of Factors Affecting the Performance of Moroccan Exports

Abstract

This study uses the autoregressive distributed lag (ARDL) technique and the error correction model (ECM) to investigate the long-run and  short-run associations between export performance and macroeconomic variables in Morocco. These macroeconomic variables are  GDP growth, real effective exchange rate (REER), consumer price index (CPI), foreign direct investments (FDI), and gross capital formation  (GCF). Using data that covers the period between 1990 and 2020, empirical results support a negative long-run association  between exports and REER, and a negative long-run relationship between exports and CPI. At a 10% significance level, results also  support a positive long-term relationship between exports, FDI, and GCF. The results derived from the ECM model suggest that the short  associations are between exports and GCF at a 5% significance level, and between exports and REER at a 10% significance level, which accounts for a positive coefficient and a negative one, respectively. The findings reveal insightful policy implications to enhance Moroccan  exports through controlling REER, encouraging foreign investments, and enhancing GCF.