Abstract:

As an element of growth, foreign trade is important for all countries. As the barriers to foreign trade are removed, the openness of countries increases. Some of Somalia's important foreign trade partners are located in East Africa. The object of this study is to dissect the trade performance between Somalia and some major trading partner countries in East Africa for the period of 2010-2020 using panel gravity model. The study can be seen as a precursor since the studies on the subject are scarce and the content of the study is comprehensive. The empirical analyses reveal that Somalia's own gross domestic product (GDP) has no effect on Somalia's foreign trade with East African countries. On the other hand, the gross domestic product (GDP) of other East African Countries with which Somalia has foreign trade has a positive and significant effect on the foreign trade volume at the 99% confidence level. The population variables, it can be said that neither Somalia nor the populations of other partner countries have an effect on the trade volume. The DIST variable, which shows the distance between countries, was found to be significant in the 90% confidence interval.

Keywords: