Paper Title
Evaluating Afghanistan's Trade and Transit Potential: An Empirical Analysis
Abstract
The main objective of this research is two-fold. Firstly, it endeavors to quantify the export potential of Afghanistan. Secondly, it provides estimations for the merchandise and energy transit potential through the country. Regional integration provides a significant opportunity for landlocked countries to access international markets and address barriers to sustainable, inclusive economic growth. The geo-strategic location of Afghanistan in the ancient Silk Route, along with its proximity to other important neighboring countries, providesa strategic advantage that can be leveraged for the economic development of the country. The structural gravity model has been used to estimate the bilateraltrade potential of Afghanistan. The PPML method is applied to estimate the gravity model using bilateral trading data of 169 countries for the 2020 to 2022 period. The study confirms Afghanistan's significant trade potential with regional and international partners. Its export potential is highest among Central Asian Republics, the Middle East, and Europe. Additionally, findings highlight strong prospects for merchandise and energy transit through Afghanistan. Afghanistan must enhance trade coordination, expand agreements, support logistics companies, and invest in regional infrastructure. Attracting private and donor investment is crucial to boost exports, transit opportunities, and economic growth.
Keywords - Trade, Transit, Integration, corridor, landlocked
Jel: F10, F14, f17