THE RELATIONSHIP BETWEEN TRADE OPENNESS AND INVESTMENT IN SYRIA

Abstract

This study attempts to investigate the effect of trade openness, GDP and population on the investment in Syria over the period 1980-2010. The cointegration test indicates that investment is positively and significantly related to the trade openness, GDP and population. Population has the biggest effect on the investment. The Granger causality test indicates bidirectional short-run causality relationships between trade openness, GDP, population and investment. There are also unidirectional long-run causality relationship running from trade openness to investment, and bidirectional long-run causality relationships between GDP, population and investment. The study result indicates that it is vital for the Syrian government to still adopt the economic policy in liberalizing foreign trade in order to motivate the investment in the country. 

Keywords

• Syria,Investment,Trade Openness,Economic Growth,Population,VAR

References

1. AL-BADRY, S. S. (1998). Private Investment and Factors Affecting It in Jordan. Economic Horizons, 19 (74).
2. AJIDE, K. B., & LAWANSON, O. (2012). Modelling the Long Run Determinants of Domestic Private Investment in Nigeria. Asian Social Science, 8 (13), pp. 139-152.
3. AL-ABDULRAZAG, B. A. (2003). The Determinants of Private Construction Investment in Jordan: An Empirical Study (1972-1996). Damascus UNIV Journal, 19 (1), pp. 15-35.
4. AL-ABDULRAZAG, B. A. (2009). The Impact of Public Investment on Private Investment in Jordan. Dirasat- Administrative Sciences, 36 (2), pp. 528-540.
5. AL-KHATIB, H. B., ALTALEB, G. S., & ALOKOR, S. M. (2012). Economical Determinants of Domestic Investment. European Scientific Journal, 8 (7), pp. 1-17.
6. ASANTE, Y. (2000). Determinants of Private Investment Behaviour. Nairobi: African Economic Research Consortium, AERC Research Paper No. 100.
7. BIBI, S., KHAN, U. A., & BIBI, A. (2012). Determinants of Investment in Pakistan. Academic Research International, 2 (2), pp. 517-524.
8. FRIMPONG, J. M., & MARBUAH, G. (2010). The Determinants of Private Sector Investment in Ghana: An ARDL Approach. European Journal of Social Sciences, 15 (2), pp. 250-261.

9. ISMAIL, I. (2005). Trade Policy Reform in Syria, What Has Been Changed?. Damascus: National Agricultural Policy Center (NAPC).
10. LESOTLHO, P. (2006). An Investigation of the Determinants of Private Investment: The Case of Botswana. Master thesis, University of the Western Cape.
11. NAA-IDAR, F., AYENTIMI, D. T., & FRIMPONG, J. M. (2012). A Time Series Analysis of Determinants of Private Investment in Ghana (1960-2010). Journal of Economics and Sustainable Development, 3 (13), pp. 23-33.
12. NATIONAL AGRICULTURAL POLICY CENTER (NAPC). (2008). Syrian Agricultural Trade 2007. Damascus: National Agricultural Policy Center.
13. OUATTARA, B. (2004). Modelling the Long Run Determinants of Private Investment in Senegal. University of Nottingham: Centre for Research in Economic Development and International Trade, CREDIT Research Paper No. 04/05.
14. SEIFAN, S. (2009). The Social Consequences of the Economic Policies in Syria. Damascus: Syrian Economic Sciences Association. (9th Feb 2009).
15. SYRIAN CENTRE FOR POLICY RESEARCH (SCPR). (2014). Socioeconomic Monitoring Report on Syria. Damascus: Syrian Centre for Policy Research (SCPR).
16. SYRIAN INVESTMENT AGENCY (SIA). (2009). The Fourth Annual Investment Report in Syria. Damascus: Syrian Investment Agency.
17. UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION (UNIDO). (2009). Independent Evaluation: Syrian Arab Republic. Vienna: United Nations Industrial Development Organization.