The Exchange Rate and its Impact on Egyptian Agricultural Exports and Imports

Abstract

The research aimed mainly at studying the impact of the exchange rate on the value of Egyptian agricultural exports and agricultural imports during the period (2000-2022). The research used the vector auto regression model (VAR) through using the Dickey Fuller test and Granger causality test to examine a causal relationship among these variables. The results showed that is a significant direct relationship between the exchange rate and agricultural exports which an increase by 10% in the exchange rate will leads to an increase by 13.4% in the value of agricultural exports. However, the results proved that there is no cointegration relationship between these two variables, and the results also showed that there is no causal relationship between them. Also, the results shows there is a significant direct relationship between the exchange rate and agricultural imports, and this isn't consistent with the economic theory because imports are inflexible, and most of the production inputs are imported from abroad, and there is no cointegration relationship or a causal relationship between these two variables.