Determinants Of Export Performance Of Leather And Leather Products Sector In Ethiopia

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Addis Ababa University


Leather and leather products export plays an important role in Ethiopia’s economy, influencing the level of economic growth, employment and balance of trade. Given the central role of leather and leather products exports in the economy, it was important to identify the factors affecting leather export. Thus, this paper identify the factors that affect Ethiopia’s leather and leather products using gravity model for a sample of 43 trading partners, over a period of 2000-2016. In addition, the paper investigates whether there is unexploited trade potential between Ethiopia and its trading partners within this sector. The empirical results show that importer’s GDP, FDI and Ethiopia's domestic infrastructure exert positive and significant impact on leather and leather products exports, while geographical distance had a negative and significant impact. On the other hand, results also point out that market access preference, bilateral real effective exchange rate and Ethiopia’s GDP play insignificant role in enhancing exports performance. Furthermore, the analysis shows that export potential exists with 31 of sample countries while 12 destination markets overused. Finally, the paper ends with some policy recommendations aiming at to improve the performance of Ethiopian leather and leather products exports



Leather and leather products exports, export performance, exports potential