An Econometric and Statistical Analysis of Sudan's Trade Integration within the Greater Arab Free Trade Area (GAFTA), 2012-2021

This study provides an in-depth statistical and econometric analysis of Sudan's trade performance within the Greater Arab Free Trade Area (GAFTA) over the decade from 2012 to 2021. The primary research objective is to empirically assess the extent to which Sudan has benefited from its membership in this regional trade agreement. Utilizing time-series data from the Central Bank of Sudan, this paper begins with a descriptive analysis of trade trends, partner concentration, and trade balance dynamics. It then progresses to inferential statistical analysis, including correlation and regression, to uncover the underlying relationships in Sudan's trade flows. Finally, a panel data regression model is employed to test specific hypotheses regarding the evolution of Sudan's trade balance over time and across different partners. The findings reveal a complex and challenging trade landscape. While key GAFTA partners—namely the United Arab Emirates, Saudi Arabia, and Egypt—dominate Sudan's regional trade, the relationship is characterized by extreme volatility, persistent and widening trade deficits, and a high concentration that increases economic vulnerability. The descriptive analysis reveals extreme trade concentration, with the top three partners accounting for over 88% of Sudan's total GAFTA trade by 2021. While Sudan maintained an average annual trade surplus of $316.5 million with the UAE, it suffered chronic structural deficits with Saudi Arabia (-$230.3 million) and Egypt (-$240.2 million). The econometric results indicate no statistically significant improvement in Sudan's overall trade balance with GAFTA partners over the studied period; the time trend coefficient was negative (-5.38) and statistically insignificant (p-value = 0.597), confirming a decade of stagnation. The analysis concludes that the potential benefits of tariff elimination under GAFTA have been largely negated by profound domestic challenges, including political instability, structural economic weaknesses, and significant non-tariff barriers.