Non-oil exports diversification and trade openness in Algeria : empirical analysis

Abstract EN

The process of trade openness is an important factor for the diversification of non-oil exports, especially for the countries that have the unity of export.

Like other developing countries, the Algerian economy is still dominated by the fluctuation of prices of goods on the international market because of the non-diversification of its economy.

In fact, oil exports alone account for 97% of all exports.

The main objective of this study is to determine the relationship between trade openness and diversification of national exports outside the hydrocarbons sector.

To do this, we use the Vector Error Correction Model (VECM) for the case of Algeria during the period 1990-2016.

Results indicates that the trade opening policy has a positive long-term effect on the diversification of exports in Algeria outside the hydrocarbons sector.