Impact of institutional quality on trade competitiveness in African continental free trade area

Abstract This study examined the impact of institutional quality on trade competitiveness in African Continental Free Trade Area using panel data generated from 53 African Continental Free Trade Area ratified member countries from 2005 to 2018. Pooled mean group, anchored on the revealed symmetric comparative advantage theory, against mean group based ARDL model was adopted as suggested by Hausman test. It was found among others by the study that in the long run, control of corruption, government effectiveness, political stability, absence of violence and terrorism, improved regulatory quality and, strong and impartial rule of law significantly encourages trade competitiveness in AfCFTA countries by about 19.43705%, 7.29468%, 2.19780%, 35.19884%, and 23.84002% respectively. In the short run, inadequate fight against corruption, political instability, violence and terrorism, low index of voice and accountability and, infrastructural factors/quality decadence have negative significant impact on trade competitiveness in AfCFTA countries by about 20.7835%, 15.26566%, 58.94717%, and 27.99211% respectively. It was therefore recommended among others by the study that AfCFTA governments and citizens should strive more to effectively control corruption not only in the public sector but also, in all institutions of human endeavours and, as well as the private sector through campaign against every acts of corruption.