IMPACT OF AID FOR TRADE IN DEVELOPING COUNTRIES OF ASIA
In the past few decades, the concept of Aid for Trade (AfT) become prominent the developing countries that received the aid and those countries who donate aid. The idea of ‘trade, not aid’ and even ‘trade as aid’ also have limited scope. The current study investigates the impact of AfT in improving overall trade received in different sectors. Data on 5 developing countries collected from OCED AfT database for the period 2002 to 2015. The results suggest that aid received in the agriculture and transport sector have positive and significant effects on trade while banking and financial services and Trade Related Policies (TRP) have insignificant impacts on the trade. Moreover, results reveal that the impact of aid on trade is negligible as the amount disbursed is very low in all sectors. There is need to increase in the amount of aid and to also make better economic policies.
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