Agrotechnology

Study of the volatility effect of agricultural exports on agriculture′s share of GDP- The case of Egypt

7^th Global Summit on Agriculture & Horticulture

October 17-19, 2016 Kuala Lumpur, Malaysia

Osama Ahmed and Walid Sallam

Cairo University, Egypt

Posters & Accepted Abstracts: Agrotechnol

Abstract:

This article aims to examine the long and short run relationship between agricultural exports and agricultureâ??s share of GDP. After two revolutions in 25th of January, 2011 and 30th of June, 2013 (Arab Spring revolutions), Egypt was suffering from very bad economic situation and was characterized by high food and energy prices, high unemployment inflation rates, and decline in economic growth rate in most relevant sectors. These political events showed the fragility of the Egyptian economy, where the Egyptian GDP growth rate decreases from 5.1% in 2010 to 2.2% in 2014, also the inflation increases from 7.1% in 2012 to 10.1% in 2014 (World bank, 2014). Egyptian food prices increased by 17.7% from the 1st week of January 2011 till the 1st week of December 2013 (Egyptian Food Observatory, 2013). The Egyptian economy depends basically on agriculture, Suez Canal revenues, tourism, taxation, cultural and media production, natural gas exports and remittances of more than three million Egyptians abroad (mostly in the Gulf State). Agriculture played a vital role in Egyptian economy, working in the agricultural sector about 30% of the total labor force, contributing about 14.8% of GDP, and agricultural exports contribute about 20% of total good exports, making the agricultural sector a significant national income resource Links between prices considered are assessed by co-integration analysis by using Johansen co-integration technique and ECM- GARCH. Results indicate a positive link in the short and long term between agricultural exports and agricultureâ??s share of GDP, as well as the co-integration between the pairs of series used also can be found; increases in agricultural exports have followed by increases in agricultureâ??s share of GDP, Agriculture exports and agricultureâ??s share of GDP elasticities are being 0.62. Evidence of that past shocks and agricultural exports contribute to increase agricultureâ??s share of GDP volatility is also found.

Biography :

Email: osama.ahmed.nasreldin@upc.edu