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The Economic Community of West African States : Fiscal Revenue Implications of the Prospective Economic Partnership Agreement with the European Union

AD VALOREM AGREEMENT ON TRADE AGREEMENT ON TRADE-RELATED ASPECTS AGRICULTURAL PRODUCTS AGRICULTURE APPLIED TARIFF AVERAGE TARIFF AVERAGE TARIFFS BASE YEAR BORDER PROTECTION CENTRAL BANK COMMON MARKET COMPENSATORY MECHANISMS CURRENCY CUSTOMS CUSTOMS ADMINISTRATION CUSTOMS DUTIES CUSTOMS REVENUE CUSTOMS REVENUES CUSTOMS UNION DEMAND ELASTICITY DEVELOPMENT DISPUTE SETTLEMENT DISPUTE SETTLEMENT MECHANISM DOMESTIC PRICE DOMESTIC PRODUCTION ECONOMIC INTEGRATION ECONOMIC OBJECTIVES ECONOMIC PERFORMANCE ECONOMIC PROGRESS ECONOMIC SIZE ELASTICITY OF SUBSTITUTION ELIMINATION OF TARIFFS EQUILIBRIUM EUROPEAN UNION EXCHANGE RATE EXPORT PERFORMANCE EXPORT PRICE EXPORTERS EXPORTS EXTERNAL TARIFF FOREIGN INVESTMENT FREE ACCESS FREE TRADE FREE TRADE AGREEMENT FREE TRADE AREA FULL LIBERALIZATION GDP GENERAL AGREEMENT ON TARIFFS GENERAL AGREEMENT ON TRADE IN SERVICES GENERAL EQUILIBRIUM ANALYSIS GENERAL EQUILIBRIUM MODEL GLOBAL INTEGRATION GROSS DOMESTIC PRODUCT IMPERFECT SUBSTITUTES IMPORT DUTIES IMPORT PRICE IMPORT PRICES IMPORT REGIME IMPORT TARIFF IMPORT TAXES IMPORTING COUNTRIES INDUSTRIAL PRODUCTS INTELLECTUAL PROPERTY INTELLECTUAL PROPERTY RIGHTS INTERNAL MARKET LDCS LEVEL OF PROTECTION LOSS OF TARIFF REVENUE MACROECONOMIC STABILITY MARKET ACCESS MEMBER COUNTRIES MEMBER COUNTRY MINISTERIAL CONFERENCE MONETARY UNIFICATION MOST FAVORED NATION NATIONAL AUTHORITIES NON-TARIFF BARRIERS OIL IMPORTS OIL PRICES PARTIAL EQUILIBRIUM ANALYSIS POLICY RESEARCH PREFERENTIAL ACCESS PREFERENTIAL MARKET ACCESS PREFERENTIAL TREATMENT PRICE ELASTICITY PROPERTY RIGHTS REGIONAL GROUPINGS REGIONAL INTEGRATION REGIONAL TRADE REGIONAL TRADE AGREEMENTS RULES OF ORIGIN SHARE OF WORLD EXPORTS TARIFF BARRIERS TARIFF CHANGES TARIFF DISTORTIONS TARIFF ELIMINATION TARIFF LINES TARIFF PROTECTION TARIFF RATE TARIFF RATES TARIFF REDUCTION TARIFF REFORM TARIFF REGIMES TARIFF REVENUE TARIFF REVENUES TARIFF SCHEDULE TARIFF SCHEDULES TAX REVENUES THE GAMBIA TOTAL REVENUE TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE CREATION TRADE DEVELOPMENT TRADE DIVERSION TRADE EFFECTS TRADE FLOW DATA TRADE FLOWS TRADE IN GOODS TRADE LIBERALIZATION TRADE POLICY TRADE POLICY REVIEW TRADE PREFERENCES TRADE REGIME TRADE RELATIONS TRADING PARTNER TRADING PARTNERS TRANSITIONAL PERIOD URUGUAY ROUND WTO ZERO TARIFF
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World Bank, Washington, DC
Africa
2012-06-07T19:32:15Z | 2012-06-07T19:32:15Z | 2007-06

This paper applies a partial equilibrium model to analyze the fiscal revenue implications of the prospective economic partnership agreement between the Economic Community of West African States (ECOWAS) and the European Union. The authors find that, under standard import price and substitution elasticity assumptions, eliminating tariffs on all imports from the European Union would increase ECOWAS' imports from the European Union by 10.5-11.5 percent for selected ECOWAS countries, namely Cape Verde, Ghana, Nigeria, and Senegal. This increase in imports would be accompanied by a 2.4-5.6 percent decrease in total government revenues, owing mainly to lower fiscal revenues. Tariff revenue losses should represent 1 percent of GDP in Nigeria, 1.7 percent in Ghana, 2 percent in Senegal, and 3.6 percent in Cape Verde. However, the revenue losses may be manageable because of several mitigating factors, in particular the likelihood of product exclusions, the length of the agreement's implementation period, and the scope for reform of exemption regimes. The large country-by-country differences in fiscal revenue loss suggest that domestic tax reforms and fiscal transfers within ECOWAS could be important complements to the agreement's implementation.

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