Dynamics of Economic Integration and Cycle Synchronization: International Trade Theories Tested in the Cemac Zone

Purpose: This study analyzes the effects of monetary integration through intra-regional trade on the synchronisation of economic cycles in the CEMAC. Methodology: This study applies a panel data model with specific effects to five of the six countries that make up the Central African Economic and Monetary Community: Cameroon, Congo, Chad, the Central African Republic, and Gabon. The data used come from two sources: The World Development Indicators (WDI) for the analysis of business cycle synchronization, and the UN Comtrade database for bilateral trade data, over a time horizon ranging from 1982 to 2018. Findings: the findings suggest that, economic and monetary integration within the CEMAC framework has not been accompanied by a synchronization of business cycles. Unique contribution to theory, practice and policy: From a theoretical perspective, the study of economic integration dynamics and cycle synchronization in CEMAC provides a new perspective by combining several economic theories. Rather than strictly applying Mundell's classical theory, this study adopts a more flexible approach that integrates endogenous criteria specific to African economies. From a political perspective, this topic highlights innovative reforms to improve economic integration in CEMAC, and provides an original approach proposing better coordination between CEMAC institutions and the BEAC for the harmonization of monetary and fiscal policies. From a practical perspective, it proposes the development of transnational infrastructure, likely to promote better connectivity between member countries, which could strengthen trade and improve the synchronization of economic cycles.