Trade Openness and Manufacturing Sector Performance in Some Selected West African Countries: A Panel Study Approach

A good performance of the manufacturing sector is germane to the development of any economy. Hence, this study examined the relationships between trade openness and manufacturing sector output in 12 selected countries in West Africa. Specifically, it investigated whether trade growth, employment growth, investment growth, exchange rate growth and inflation rate impacted on manufacturing sector performance in the selected countries over the period from 1980 to 2019. Most of the earlier studies had been a time series analysis but this study differs in that the panel data series were analyzed using econometric techniques which included Dynamic Ordinary Least Square (DOLS) and Fully Modified Ordinary Least Square (FMOLS). This was to determine the magnitude of impacts of the explanatory variables on the manufacturing sector. The results of FMOLS and DOLS therefore, revealed that all the coefficients are positively associated and significant with manufacturing sector output except for trade openness that is not significant and inflation rate is negatively significant. This paper based on the findings of this study, therefore, recommends that the region needs to strengthen its involvement in trade liberalization and also sustain foreign policies that would attract more foreign direct investment (FDI) inflows.