Toward regional development: transactional analysis of regional integration in the economic community of west African states (ECOWAS)
The rationale for regional integration among developing countries rests mainly on the effects of the creation of regional markets on the more fundamental problems of those countries which include the need for mobilization of unemployed resources, capital formation for domestic investment, improvement in the general standard of living, and the prospective gains from trade liberalization. While these goals are important, the structural features of typical developing countries often present enormous obstacles toward their realization. The Economic Community of West African States (ECOWAS) was established in 1975 and is made up of sixteen countries. While one of its main objectives is to encourage and intensify intraregional trade among the member states and to reduce external trade dependency, it is also anticipated that effective economic integration would, in the course of time generate clear political and socio-cultural ties which would, in tum, reinforce the integration scheme. However, since the formation of ECOWAS in 1975, intraregional trade has remained very low compared to extra-regional trade, and this along with various stmctural and policy constraints within the region have impeded the process of effective regional integration. The purpose of this study was to provide possible explanations in terms of the relative impacts of specific factors that tend to contribute to or limit intraregional trade among the ECOWAS states and the general implication for regional integration. The concept of regional integration is based on the transactional paradigm for which aggregate trade flows provide a basis for assessing the past performance as well as the future prospect of a regional integration scheme.