The Study on the differential Impact of Exchange Rate Fluctuations on Imports and Exports Trade in the Republic of Congo

Abstract

The paper purpose is to determine the impact of exchange rate fluctuation imports and exports in the Republic of Congo during 1999-2019 based on ARDL model.

VAR model were used to test the differential impact on Impulse response and variance analysis.

ARDL model results shows a positive influence on export products up to 38% while the exchange rate impact on import at 60% with a R2 of 41% and 29% on export. Impulse response shows that exchange rates responded positively to imports and negatively to exports.

Keywords: Exchange rate fluctuations, Imports and Exports trade, Asymmetric effects, ARDL model, VAR model.