International trade and economic growth in Tanzania

Abstract

International trade is considered among the leading debates taken not only in developing countries but worldwide as well. Empirical investigation on the linkage between economic growth and export performance is considered important. The study aims to determine the relationship between export and import on economic growth of Tanzania. Data used in analysis was covering the period 1992-2017. The study applied Ordinary Least Square (OLS) multiple regression analysis, to investigate the relationship among variables. The study findings signify a positive and significant relationship between export and economic growth in Tanzania. Whereas negative and significant relationship was observed between import and economic growth in a country. The study therefore recommended that; government should enhance international trade by increasing export through enhancing environment for trade promotion in addition to increasing participation of Tanzania to the global market. Particularly, government should improve the production of more exportable commodities by allowing tax incentives to producers and assisting them with subsidies wherever necessary. Furthermore, export tariffs should be lowered to increase so as to encourage more export since it is considered to be the source of foreign earnings and therefore adds to the growth of the national economy