Assessing Chinese–Egyptian bilateral trade dynamics under the One Belt One Road initiative: augmented gravity model approach
Elzarka, Sara Abdelbary, Islam
Elzarka, Sara
Abdelbary, Islam
Type
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Date
2025-01-24
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Abstract
Purpose This research paper investigates the economic impact of China’s One Belt, One Road (OBOR) initiative on its historical trade partner, Egypt, within a landscape shaped by global interconnectedness. Design/methodology/approach The paper employs an augmented gravity model with a random-effects estimator and robust standard errors to analyze the impact of the OBOR initiative on China–Egypt bilateral trade from 1960 to 2022. Findings The findings reveal a significant increase in trade volume following the implementation of OBOR. The model confirms the continued importance of gross domestic product (GDP) and geographic proximity in facilitating trade. Additionally, the research highlights Egypt’s strategic positioning within the OBOR due to its location and existing infrastructure, such as the Suez Canal. Practical implications These results offer valuable insights for policymakers and stakeholders seeking to optimize bilateral trade strategies and strengthen economic cooperation under the OBOR framework. Originality/value This study contributes to the existing literature by providing a fresh perspective on the impact of OBOR, employing a robust econometric approach and focusing on a specific yet crucial regional trade relationship.