A Policy Approach towards Achieving Regional Economic Resilience in Developing Countries: Evidence from the SADC

External economic shocks such as the global financial crisis (GFC) affect regional economic growth in developing regions through impacting export demand and capital inflows. Resilience to these economic shocks—i.e., the ability to recover from the initial impact and prolonged effects of said shocks—...

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Bibliographic Details
Published in:Sustainability 2021-03, Vol.13 (5), p.2674
Main Authors: Pretorius, Ockert, Drewes, Ernst, van Aswegen, Mariske, Malan, Gerard
Format: Article
Language:English
Subjects:
Adaptability
Capital
Consumption
Developing countries
Econometrics
Economic conditions
Economic development
Economic growth
Exports
Financial services
Impact analysis
Industrial development
International trade
LDCs
Literature reviews
Planning
Productivity
Regional development
Regions
Resilience
Social structure
Tariffs
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Summary:External economic shocks such as the global financial crisis (GFC) affect regional economic growth in developing regions through impacting export demand and capital inflows. Resilience to these economic shocks—i.e., the ability to recover from the initial impact and prolonged effects of said shocks—is influenced by the inherent vulnerability of regional economies to their impact. The research objective is to investigate regional economic resilience policy in the context of the Southern African Development Community (SADC), and the wider perspective of trading blocs among developing countries. Central hereto is undertaking an equilibrium and econometric analysis to identify endogenous and exogenous factors of the regional economy that influence economic resilience. Analysis findings indicate that economic openness, export market dynamics and sectoral composition may influence economic resilience. SADC vulnerability may be attributed to the dependence on foreign direct investment (FDI) inflows and exports to higher-income markets, relatively low import tariffs and the comparative importance of tertiary activities to output. A balanced regional policy approach is required: one focused on industrialization, while incorporating elements to support economic resilience. The latter includes increased intra-regional trade anchored in the development of regional supply and value chains which support primary sector activities, and capacitated supranational institutions to oversee regional integration initiatives.
ISSN:2071-1050
2071-1050
DOI:10.3390/su13052674