EXCHANGE RATE REGIME FOR MACROECONOMIC PERFORMANCE: LESSONS FROM REGIONAL INTEGRATED AREAS IN SOUTHEAST ASIA (ASEAN-10) AND WEST AFRICA (ECOWAS-15)

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DISSERTATION

EXCHANGE RATE REGIME FOR MACROECONOMIC

PERFORMANCE: LESSONS FROM REGIONAL INTEGRATED AREAS IN SOUTHEAST ASIA (ASEAN-10) AND WEST AFRICA (ECOWAS-15)

MORO KADJO DANIEL BITTY

NIM: 041217037311

DOCTORAL PROGRAM IN ECONOMICS

FACULTY OF ECONOMICS AND BUSINESS

UNIVERSITAS AIRLANGGA

SURABAYA

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DISSERTATION

MORO KADJO DANIEL BITTY

NIM: 041217037311

DOCTORAL PROGRAM IN ECONOMICS

FACULTY OF ECONOMICS AND BUSINESS

UNIVERSITAS AIRLANGGA

SURABAYA

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DISSERTATION

MORO KADJO DANIEL BITTY

NIM. 041217037311

DOCTORAL PROGRAM IN ECONOMICS

FACULTY OF ECONOMICS AND BUSINESS

UNIVERSITAS AIRLANGGA

SURABAYA

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This Dissertation

has been submitted and successfully evaluated by the Board of

Examiners for the Award of a Doctoral Degree in Economics

at the Faculty of Economics and Business in Universitas Airlangga

On Wednesday, June 1, 2016

Time: 10am-12pm

By:

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APPROVAL SHEET BY THE BOARD OF EXAMINERS

This Dissertation has been examined and approved by the Board of Examiners

through a Closed-door Examination at the Faculty of Economics and Business of

Universitas Airlangga in February 23rd_{, 2016.}

BOARD OF EXAMINERS:

Head: Prof. Dr. Djoko Mursinto, SE., M.Ec

Members: 1. Dr. Rudi Purwono

2. Prof. Dr. Agus Suman, SE., DEA

3. Dr. H. Kasturi Sukiadi, SE.

4. Dr. Lilik Sugiharti

5. Dr. Wisnu Wibowo, SE., M.Si.

6. Dyah Wulansari, Dra.Ec., M.Ec.Dev.,PhD

Ditetapkan Dengan Surat Tugas Pimpinan Fakultas Ekonomi dan Bisnis Universitas Airlangga

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ACKNOWLEDGEMENTS

The Ph.D. research also called dissertation is an academic journey that rewards a student with a doctoral Degree when actually, it was a teamwork that achieved it. That is the reason why, first and foremost, I would like to express my

heartfelt gratitude to my dissertation Supervisors: Prof. Dr. Djoko Mursinto, Dr.

Unggul Heriqbaldi and Dr. Rudi Purwonofrom Airlangga University. Thanks to you for providing me the opportunity to do such a research under your guidance and meaningful instructions about the delicate mixed-methodology analysis that I have used to answer monetary issues. I have been so lucky and blessed to be

learning by their sides. Prof. Djoko and Dr. Rudi Purwono have shared with me

almost everything that could help me comprehend the complexity of monetary policies. Their time, books, journals, personal experiences, etc. will never be forgotten. I deeply thank you also for giving me “space and free time” so that I could work honestly, deeply and creatively on my dissertation. Terima Kasih Pak!

In addition, I would like to tell my deep gratitude to the Board of Examiners

namely Prof. Dr. Agus Suman, SE., DEA as the outside Examiner, Prof. Dr.

Djoko Mursinto, SE., M.Ec, Dr. Unggul Heriqbaldi, Dr. H. Kasturi Sukiadi, SE., Dr. Rudi Purwono, Dr. Lilik Sugiharti, Dr. Wisnu Wibowo, SE., M.Si. and

Dr. Dyah Wulansari who took time to read my proposal and dissertation; their idealisms and meaningful inputs have brought me to this academic achievement.

Terima Kasih.

Besides the Supervisors of my research who were my references from the academic point of view, the beginning and completion of this Ph.D. project have

been possible thanks to the Republic of Indonesia (RI) for granting the

Scholarship “Beasiswa Unggulan” through the Ministry of Education and Researches, the Immigration Department and their Representatives at the Embassy

of Indonesia in Dakar, particularly His Excellence Ambassador Indra Djati, Pak

Rheinhard Sinaga, Ibu Elis, Pak Abdul Ghofar and Ibu Ayu.

I owe a special thanks to Ibu Ayu Suryawati, a Great Lady who, from the

very beginning, was the first to call me when I was still in Africa, Cote d’Ivoire,

and invited me to apply for a scholarship: “Beasiswa Unggulan” which has brought

me to this achievement. Thank you so much Dear Ibu Ayu! Actually, while I am writing these thanksgiving words, I realize that the “Acknowledgement”, as part of the dissertation, is a reminder of every step of the journey, all the challenging and enjoyable moments. Looking backward, it is a great pleasure for me to remember and acknowledge the assistance and contributions of many individuals in making this part of my life a success. Indeed, there are three groups of people and institutions that I wish to express my sincere gratitude.

I am grateful to “those who were there with me, from the very

beginning”, when this Ph.D. project was just an infant dream.

- To “La Fondation Benianh International” and its Chairman Noel

Akossi Benjo, the Managers Sylviane Fontaine and Bitty Kokora Pierre for

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- To “ISM Dakar” and its President Amadou Diaw, for the connection

built with the Indonesian Embassy through Dr. Diane Abdoulaye. Merci infiniment à vous!

The second group of persons that I am pleased to tell my immense gratitude is

“the Academics of Airlangga University”.

- To the Rectorate of Universitas Airlangga, the Academic Director

Prof. Dr. Ni Nyoman Tri Puspaningsih, Ibu Lilik, Ibu Diah Prihatiningsih,

the International Office for Partnership (IOP), Pak Jalal, and the Faculty of

Economics and Business for making my integration to “Keluarga Airlangga” a

meaningful and joyful moment.

- To the staff of my University, I thank you for being so understanding

by allowing my presence in the Library until late in the night. Thank you Pak Bustani and Dr. Wisnu Wibowo for the books generously shared.

- To my Teachers and Lecturers, especially the Dean of the Faculty of

Economics and Business Prof. Dr. Dian Agustia, and Dr. Rudi, Dr. Ibu Rahma,

Pak Dr. Soekarnoto, Dr. Winifred Lydia Wirkus and Dr. H. Kasturi Sukiadi

for giving me the chance to teach “Philosophy of economics” at the Master’s Program; it was a unique experience, a learning process that enables me to overpass my comfort zone.

- To Pak Edy Purwanto, Pak Nashrudin Latif, Mbak Indah, Mas

Rizal, Indra, Mbak Dewi, Mbak Pratiwi, Mas Suroto (Printing Enterprise,

Centro), and those Anonymous who were always willing to help me. Thank you!

- To my colleagues and classmates Pak Aris, Ibu Lucky, Juliana, Ibu Alwiyah, Pak Sjamsul, Ibu Tia, Ibu Bagas and my friends Daniela Tello, Caro, Hubert, Luciana, Miguel, Toma, Archil, Tanty, Pak Bayu, Yudi, Zoltan,

Lydia, Ice, Retno and especially Michel Tanguay for sparing their time to discuss

economic issues whenever I needed external perspectives.

Lastly, the third group of people that I will always be indebted to is “those who

gave me the Energy, Trust and Love” that kept me standing firm during difficult times of my studies. I remember when I first arrived in Indonesia with the dream of obtaining a Doctoral Degree from the largest ASEAN economy, I had just two hundreds dollar in my pocket, and no savings. I was aware that it wouldn’t be an easy way to go through because my scholarship could only cover the tuition fees. BUT, today I can make that dream become reality thanks to the following persons:

- To my Dear Father and my mentors Bitty Kokora Pierre, Beugre

Yao Claude, Dr. Kipre Momele from the Central Bank of West African States

(BCEAO), N’guessan Bitty Blaise (RIP), Bouga Roger and Grand-Ma,

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- Special mention goes to my enthusiastic and very kind friends Francisco alias Panchito, Madre and Padre Julio, John, Nelson, Dianita and many more who sponsored my memorable academic trip to Chile in June 2014, at

Universidad Tecnica Frederico Santa Maria (UTFSM) and TINET Company. I have certainly left my heart there in Santiago and Valparaiso... Muchos Gracias for showing me the power and beauty of Friendship. Without your encouragement and guidance this project would not have materialized on time.

- Similar, profound gratitude goes to Ibu Herry, Pak Herry, Ibu Budi,

Pak dr. Budi, Donny, Putri, Reza, Rike and Bimo who received me in there house in Surabaya, as a member of their family. Indeed, I was home. Terima kasih, semoga Tuhan selalu memberkati kalian!

- To Pak Freddy and Ibu Priska Pangkey the Director of ADICITRA, I would like to tell my deepest gratitude. I can’t say thank you enough for their tremendous support and help. I feel motivated and encouraged every time we meet. I have so many things to say to you both but, only one word remains: MERCI!

- Thanks to Pak Dr. Kresnayana Yahya as well for the emails shared

and data about ASEAN-10 economies.

- Last but not least, to my “Aussie mum”, Mrs. Maria Bartholomew,

her smart daughter J-A, and Peter from Sydney, I am grateful for their constant

support and help, especially in reviewing the syntax of my dissertation.

Thank you all for giving me the chance to learn from you and improve myself.

Thanks to God “the Invisible Hand” for keeping me safe until now.

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SUMMARY

This dissertation shows that, nowadays, the exchange rate appears to be the single monetary tool that can be used to simultaneously boost economic growth and protect national or regional economic fundamentals against adverse external shocks, but how? That’s the question which constitutes the major concern of this study. Using secondary macroeconomic data for the period 1990-2014, this research has adopted a mixed-methodology approach based on correlation tests and statistical mapping technique analyses. Indeed, it is a systematic descriptive and comparative study that aims to comprehend the factual correlation between exchange rate and five macroeconomic performance indicators namely: GDP growth, inflation, foreign direct investment, unemployment rate and current account balance of twenty five countries from two regional integrated areas which are the Association of Southeast Asian Nations (ASEAN-10) and the Economic Community of West African States (ECOWAS-15). The major findings of this dissertation are firstly: we have learned that under floating exchange rate regime, a low GDP growth appears to be the cost of a successful inflation targeting policy; and to avoid that tradeoff between inflation and GDP growth, “qualitative easing” policies are suggested. On the other hand, currency pegged regime fits well “Externally Oriented Economies” like Singapore and most of the small economies of ECOWAS. Also, in countries under floating exchange rate regimes, the FDI is high but very cyclical due to the ability of investors to freely move their capital while in countries under fixed exchange rate regimes the FDI is lower but stable over time. Hence, we propose new formulations of the exchange rate valuation

named: the “Inclusive Nominal Exchange rate” (INEX) and “Commodity

Nominal Exchange rate” (CNEX) which are both based on real economic

performances of countries and the structure of their economies. Finally, this research provides an illustration of the INEX which showed that in 2014, the Indonesian “inclusive exchange rate” was estimated at 10,524 while the nominal exchange rate was near 12,000. This means that the macroeconomic fundamentals of Indonesia were better but, the nominal exchange rate failed to capture that performance. In short, rethinking the exchange rate regime strategy is a necessity and it should be used as a major instrument in open economies according to the

structure of their markets and their macroeconomic objectives. In fact, a “new

monetary era” is emerging due to the greater openness of economies, the

increasing influence of regional economic blocks and the global industrial value-chains that creates an interconnected global market. Clearly, exchange rate has become a more effective monetary tool than the interest rate was. Indeed, for

more than seven years of “quantitative easing” policy applied by the United

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Abstrak (Indonesian Language)

Disertasi ini menunjukkan bahwa, saat ini, nilai tukar tampaknya menjadi alat moneter tunggal yang dapat digunakan untuk secara bersamaan meningkatkan pertumbuhan ekonomi dan melindungi fundamental ekonomi nasional atau regional terhadap guncangan eksternal, tapi bagaimana caranya? Pertanyaan itulah yang merupakan perhatian utama dari penelitian ini. Dengan menggunakan data makroekonomi sekunder untuk periode 1990-2014, penelitian ini telah mengadopsi pendekatan mix-metodologi berdasarkan tes korelasi dan teknik pemetaan. Tulisan ini menganalisa korelasi faktual antara nilai tukar dan lima makroekonomi variabel yaitu pertumbuhan PDB, inflasi, investasi asing langsung, tingkat pengangguran dan neraca perdagangan. Di sini, kita belajar dari dua puluh lima negara berasal dari dua Kawasan Ekonomi yaitu ASEAN-10 dan Masyarakat Ekonomi Negara Afrika Barat (ECOWAS-15) dengan masing masing rezim nilai tukar yang sangat beragam. Penelitian ini adalah studi deskriptif dan komparatif yang bertujuan untuk memahami secara sistematis saluran transmisi antara nilai tukar dan kelima indikator kinerja makroekonomi tersebut. Temuan-temuan utama dari disertasi ini adalah pertama: di bawah rezim kurs mengambang bebas, pertumbuhan PDB yang rendah tampaknya menjadi biaya kesuksesan inflasi yang terkendali rendah; dan untuk menghindari tradeoff tersebut antara inflasi dan pertumbuhan PDB, "pelonggaran kualitatif" adalah kebijakan yang disarankan di studi ini. Di sisi lain, rezim nilai tukar tetap cocok dengan "External Oriented Economies" seperti Singapura dan kebanyakan Negara di ECOWAS. Juga, di negara-negara di bawah rezim nilai tukar mengambang, investasi asing langsung sangat tinggi tapi sangat siklis karena kemampuan investor untuk dengan bebas memindahkan modal mereka; sementara di negara-negara di bawah rezim nilai tukar tetap investasi asing langsung menjadi lebih rendah tapi stabil dalam jangka panjang. Oleh karena itu, kami mengusulkan formulasi baru dari penilaian nilai tukar yang bernama: yang "Inclusive Nominal Exchange rate" (INEX) dan "Commodity Nominal Exchange rate" (CNEX) yang mana penilaiannya didasarkan pada kinerja ekonomi riil negara dan struktur ekonomi mereka. Akhirnya, penelitian ini memberikan ilustrasi dari INEX yang menunjukkan bahwa pada tahun 2014, "nilai tukar inklusif" Indonesia menguat sampai 10524 terhadap US dollar sedangkan nilai tukar nominal saat itu mendekati 12000. Itu berarti bahwa fundamental makroekonomi Indonesia sudah membaik, namun kurs nominal gagal menangkap kinerja tersebut. Singkatnya, memikirkan kembali strategi rezim nilai tukar adalah suatu keharusan dan harus digunakan sebagai sebuah instrumen utama di negara-negara terbuka sesuai struktur ekonomi dan tujuan makro ekonomi mereka.

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Résumé (French)

Cette thèse montre que, de nos jours, le taux de change semble être l'unique outil monétaire qui peut être utilisé pour simultanément stimuler la croissance économique et protéger les fondamentaux économiques nationaux ou régionaux contre les potentiels chocs externes, mais comment? Telle est la question qui constitue la préoccupation majeure de cette étude. En utilisant les données macro-économiques secondaires durant la période 1990-2014, cette recherche a adopté une approche méthodologique mixte basée sur des tests de corrélation et technique statistique de cartographie. En effet, il s’agit d’une étude descriptive et comparative systématique qui vise à comprendre la corrélation factuelle entre le taux de change et des cinq indicateurs de performance macro-économiques à savoir: la croissance du PIB, l'inflation, l'investissement direct étranger, le taux de chômage et la balance commerciale des vingt-cinq pays de l'Association des Nations d’Asie du Sud-Est (ANASE-10) et la Communauté Economique des Etats de l'Afrique de l'Ouest (CEDEAO-15). Les principales conclusions de cette thèse sont entre autre: sous le régime de change flottant, une faible croissance du PIB semble être le coût d'une inflation contrôlée. Ainsi pour éviter ce choix difficile entre l'inflation et la croissance du PIB, les politiques «d'assouplissements qualitatifs" sont suggérées. D'autre part, les régimes fixes ou d’arrimage de monnaies semblent bien adaptées aux "économies orientées vers l'extérieur" comme Singapour et la plus part des économies de la CEDEAO. En outre, dans les pays sous les régimes de change flottants, l'investissement direct étranger est élevé, mais très cyclique en raison de la capacité des investisseurs à déplacer librement leur capitaux alors que dans les pays soumis à des régimes de change fixes, l'investissement direct étranger est plus faible mais assez stable sur le long terme. Par conséquent, nous proposons de nouvelles formulations du taux de change dont le nom serait : le “Inclusive Nominal Exchange rate” (INEX) et le “Commodity Nominal Exchange rate” (CNEX) qui ont tous deux leurs valeurs basées sur les performances économiques réelles et la structure de leurs

économies. Enfin, cette thèse offre une illustration du “INEX” qui montre qu’en

2014, le “taux de change inclusif” Indonésien devait apprécier et être estimer à 10.524 alors que le taux de change nominal par rapport au dollar Américain avoisinait 12.000. Cela signifie que les fondamentaux macroéconomiques de l'Indonésie s’étaient améliorés, mais le taux de change nominal a manqué de

prendre compte cette performance. En bref, repenser la stratégie liée au choix du

régime de change est une nécessité et cela doit être utilisé en tant qu’un instrument majeur dans les économies ouvertes, en tenant compte bien sûr de leurs structures économiques et objectifs macroéconomiques.

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Abstract

This dissertation shows that, nowadays, the exchange rate appears to be the single monetary tool that can be used to simultaneously boost economic growth and protect national or regional economic fundamentals against adverse external shocks, but how? That’s the question which constitutes the major concern of this study. Using secondary macroeconomic data for the period 1990-2014, this research has adopted a mixed-methodology approach based on correlation tests and statistical mapping technique analyses. Indeed, it is a systematic descriptive and comparative study that aims to comprehend the factual correlation between exchange rate and five macroeconomic performance indicators namely: GDP growth, inflation, foreign direct investment, unemployment rate and current account balance of twenty five countries from two regional integrated areas which are the Association of Southeast Asian Nations (ASEAN-10) and Economic Community of West African States (ECOWAS-15). The major findings of this dissertation are firstly: we have learned that under floating exchange rate regime, a low GDP growth appears to be the cost of a successful inflation targeting; and to avoid that tradeoff between inflation and GDP growth, “qualitative easing” policies are suggested. On the other hand, currency pegged regime fits well “Externally Oriented Economies” like Singapore and most small economies of ECOWAS. Also, in countries under floating exchange rate regimes, the FDI is high but very cyclical due to the ability of investors to freely move their capital while in countries under fixed exchange rate regimes the FDI is lower but stable over time. Hence, we propose new formulations of the exchange rate valuation

named: the “Inclusive Nominal Exchange rate” (INEX) and “Commodity

Nominal Exchange rate” (CNEX) which are both based on real economic

performances of countries and the structure of their economies. Finally, this research provides an illustration of the INEX which showed that in 2014, the Indonesian “inclusive exchange rate” was estimated at 10.524 while the nominal exchange rate was near 12.000. This means that the macroeconomic fundamentals of Indonesia were better but, the nominal exchange rate failed to capture that performance. In short, rethinking the exchange rate regime strategy is a necessity and it should be used as a major instrument in open economies according to the

structure of their economiesand their macroeconomic objectives.

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CONTENTS

CHAPTER 1: INTRODUCTION………. 1

1.1 Preface………... 1

1.2 Statement of the Problem……….. 6

1.3 Research Questions……… 18

1.4 Objectives of the Research………. 19

Pages 1st_{Title Page .…...………..……...} _i

2nd_{Title Page ………...………} _ii

3rd_{Title Page ………...………..…………} _iii

Submission of Dissertation .………...………… iv

Approval Sheet …...………... v

Approval Sheet by the Board of Examiners ... vi

Declaration / Pernyataan ……..………... vii

Acknowledgements …………..………. viii

Summary ………..………...………. xi

Abstrak (Indonesian Language) ……….…..……. xii

Résumé (French) ………..………. xiii

Abstract ... xiv

Contents ………...…. xv

List of Tables ………. xxiii

List of Figures ……… xxv

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1.5 Benefits and Novelty of the Research……… 21

CHAPTER 2: LITERATURE REVIEW………...………. 23

2.1Theories of Money……….. 23

2.2Types of Exchange rate regime ………. ₂₇

2.2. 1 Fixed Exchange Rate Regimes ……… 29

2.2. 2 Floating Exchange Rate Regimes………. 37

2.3 Critical literature on Exchange Rate and Macroeconomic Performance ……… 40

2.3.1 Exchange Rate and GDP growth according to the literature ... 41

2.3.2 Exchange Rate and Inflation according to the literature…... 44

2.3.3 Exchange Rate and Foreign Direct Investment according to the literature……… 46

2.3.4 Exchange Rate and Unemployment according to the literature 50 2.3.5Exchange Rate and trade balance according to the literature… 52 2.4Regional Integration theories………. 56

2.4.1 Brief view of the Association of Southeast Asian Nations (ASEAN-10) ... 62

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CHAPTER 3: CONCEPTUAL FRAMEWORK AND HYPOTHESES ... 65

3.1 Conceptual Framework……….. 65

3.2 Logical Framework……… 74

3.3 Hypotheses of the research……… 76

CHAPTER 4: RESEARCH METHOD……… 78

4.1 Type of Research………... 78

4.2 Place and Time frame of the Research………... 79

4.3 Data Collection……….. 80

4.4 Identification of variables ………..……….. 81

4.4.1 The Exchange Rate ...…. 81

4.4.2 The Gross Domestic Product (GDP) growth ...………... 82

4.4.3 The Inflation rate ...……….. 82

4.4.4 The Foreign Direct Investment (FDI) ...………...…. 82

4.4.5 The Unemployment rate ... 83

4.4.6 The Current Account Balance or Trade Balance ...………. 83

4.5 Operational variables ………..……….. 84

4.5.1 The Exchange Rate ...…. 84

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4.5.3 The Inflation rate ...……….. 85

4.5.4 The Foreign Direct Investment (FDI) ...………...…. 85

4.5.5 The Unemployment rate ... 86

4.5.6 The Current Account Balance or Trade Balance ...………. 87

4.6 Data Analysis Techniques………. 87

4.6.1 The Pearson’s Correlation Test ...………... 87

4.6.2 The Mapping Technique ... ..….. 91

CHAPTER 5: DATA ANALYSIS AND RESULTS ... 97

5.1 Testing the Hypotheses for ASEAN-10 Countries from 1990-2014 .... 97

5.1.1 Correlation Test of Exchange rate (xi) and GDP growth (yi) in ASEAN-10 Countries (1990-2014) ... 98

5.1.2 Correlation Test of Exchange rate (xi) and Inflation rate (yi) in ASEAN-10 Countries (1990-2014) ... 100

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5.1.4 Correlation Test of Exchange rate (xi) and Unemployment

rate (yi) in ASEAN-10 Countries (1990-2014) ... 106

5.1.5 Correlation Test of Exchange (xi) rate and Current Account

Balance (yi) in ASEAN-10 Countries (1990-2014) ... 109

5.2 Testing the Hypotheses for ECOWAS-15 from 1990-2014 ... 115

5.2.1 Correlation Test of Exchange rate (xi) and GDP growth (yi) in

ECOWAS-15 Countries (1990-2014) ... 116

5.2.2 Correlation Test of Exchange rate (xi) and Inflation rate (yi)

in ECOWAS-15 Countries (1990-2014) ... 118

5.2.3 Correlation Test of Exchange rate (xi) and the Foreign Direct

Investment (yi) in ECOWAS-15 Countries (1990-2014) ... 121

5.2.4 Correlation Test of Exchange rate (xi) and Unemployment

rate (yi) in ECOWAS-15 Countries (1990-2014) ... 124

5.2.5 Correlation Test of Exchange rate (xi) and Current Account

Balance (yi) in ECOWAS-15 Countries (1990-2014) ... 127

CHAPTER 6: INTERPRETATION OF THE RESULTS ... 136

6.1 Interpretation of the correlation map in ASEAN-10 ... 137

6.1.1 Interpretation of the correlation between exchange rate and

GDP growth in ASEAN-10 ... 140

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the FDI in ASEAN-10 ... ₁₈₀

Unemployment in ASEAN-10 ... ₂₁₇

the current account balance in ASEAN-10 ... ₂₃₁

6.2 Interpretation of the correlation map in ECOWAS-15 ... 246

GDP growth in ECOWAS-15 ... 248

Inflation in ECOWAS-15 ... 275

the FDI in ECOWAS-15 ... ₂₈₄

Unemployment in ECOWAS-15 ... ₃₀₂

the current account balance in ECOWAS-15 ... ₃₁₃

6.3 Lessons learned from the differences and similarities between

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6.3.1 Lessons learned from the correlation between Exchange rate

and GDP... ₃₂₈

6.3.2 Lessons learned from the correlation between Exchange rate and Inflation ... ₃₃₅

6.3.3 Lessons learned from the correlation between Exchange rate and FDI ... 336

6.3.4 Lessons learned from the correlation between Exchange rate and Unemployment ... 337

6.3.5 Lessons learned from the correlation between Exchange rate and Trade Balance ... 338

CHAPTER 7: CLOSING ... 345

7.1 Conclusion ... 345

7.2 Recommendations ... 348

7.2.1 A clear vision and long term commitment ... 348

7.2.2 Yes to short term monitoring but with a long term communication strategy ... 348

7.2.3 A new formulation of exchange rate that promotes stability and inclusive economic growth for large countries (INEX-illustration) ... 349

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7.2.5 Solution for inclusive employment under regional integration

framework ... 351

7. 3 Limitations and Further Researches ... 352

REFERENCES ... 354

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Table 2.1: Recapitulation of the Correlation between Exchange Rate and GDP,

Inflation, FDI, Unemployment and Trade Balance according to theories …...… 59

Table 2.2: The difference between Regionalism and Regionalization ………… 62

Table 5.1.1: Results of the correlation test between exchange rate and GDP

growth in ASEAN-10, 1990-2014 ... 98

Table 5.1.2: Results of the correlation test between exchange rate and inflation

in ASEAN-10, 1990-2014 ... 100

Table 5.1.3: Results of the correlation test between exchange rate and FDI in

ASEAN-10, 1990-2014 ... 103

Table 5.1.4: Results of the correlation test between exchange rate and

unemployment in ASEAN-10, 90-2014 ... 106

Table 5.1.5: Results of the correlation test between exchange rate and trade

balance in ASEAN-10, 90-2014 ... 109

Table 5.1.6: Recapitulation of Correlation test’s Results for ASEAN-10 from

1990-2014 ... 112

Table 5.2.1: Results of the correlation test between exchange rate and GDP in

ECOWAS-15 (1990-2014) ... 116

Table 5.2.2: Results of the correlation test between exchange rate and inflation

in ECOWAS-15 ... 118

Table 5.2.3: Results of the correlation test between exchange rate and the FDI

in ECOWAS-15 ... 121

Table 5.2.4: Results of the correlation test between exchange rate and

unemployment in ECOWAS-15 ... 124

Table 5.2.5: Results of the correlation test between exchange rate and trade

balance in ECOWAS-15 ... 127

Table 5.2.6: Correlation test results for ECOWAS-15 ... 131

Table 6.1.1: Inflation rates comparison before and after 1999 in ASEAN-6 ... 168

Table 6.2.1: ECOWAS, 1990,1999 and 2014 Value Added (% of GDP) by

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Table 6.2.2: Inflation in Guinea, the highest rate in ECOWAS 1999-2014 ... 279 Table 6.2.3: Inflation in Nigeria and Ghana, Periods 1990-99 and 1999-2014 ... 281 Table 6.2.4: WAEMU’ Average Inflation rate, during period 1990-99 and

1999-2014 ... ₂₈₂

Table 6.2.5: Average Exchange rate of 3 Post-conflicts Countries under

various regimes ... ₂₉₀

Table 6.2.6: Average FDI % in 3 Post-conflicts Countries under various

regimes ... 290

Table 6.2.7: Average FDI (%) in ECOWAS, during period 1990-99 and

1999-2014 ... ₂₉₆

Table 6.2.8: Comparison of Average Interest rates between fixed and floating

regimes in ECOWAS ... ₂₉₇

Table 6.2.9: Average Unemployment rates in ECOWAS, during period

1990-99 and 1990-99-2014 ... ₃₀₅

Table 6.2.10: Growth of International Prices (%) of Major Commodities, 1990,

1999 and 2014 ... 316

Table 6.2.11: ECOWAS Countries’ Major exported Commodities 1999-2006 .. 318

Table 6.3.1 Estimation of the Inclusive Nominal Exchange rate (INEX) in

Indonesia 1990-2014 ... 330

Table 6.3.2 Estimation of the Commodity Nominal Exchange rate (CNEX) in

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List of Figures

Figure 1.2a: GDP growth Performance in ASEAN-10 from 1990-99 & 99-2014.. 7

Figure 1.2b: GDP growth Performance in ECOWAS from 1990-99 & 99-2014... 8

Figure 1.2c: Structural breaks and Exchange Rate Regimes Evolution in ASEAN-10 and ECOWAS-15 (1990-2014) ………...…………... 9

Figure 1.2d: Exchange Rate Performance against the USD in ASEAN-10 from 1990-99 & 99-2014 ………...………... 14

Figure 1.2e: Exchange rate Performance in ECOWAS-15 from 90-99 & 99-2014.………...…...………... 15

Figure 1.2f: Overview of the Macroeconomic performance under Various Exchange rate regimes in ASEAN-10 ………... 16

Figure 1.2g: Overview of the Macroeconomic performance under Various Exchange rate regimes in ECOWAS-15………. 16

Figure 2.1: Functions of International Money ………. 25

Figure 2.2: Evolution of the Systems and types of Money ……… 26

Figure 2.3: Various forms of exchange rate regimes ………... 28

Figure 2.4: Common Currency Area leading to Economic Growth ……… 32

Figure 2.5: Intraregional trade intensity and purchasing power ……….. 32

Figure 2.6: Labor mobility under Common Currency Area ……… 33

Figure 2.7: The impossible triangle Model ……….. 39

Figure 2.8: The Monetary Transmission Mechanism ... 42

Figure 2.9: Example of the indirect effect of Fixed Exchange Rate on Inflation 44 Figure 2.10: Example of the direct effect of Exchange Rate on Inflation – The Supply Side ……….. 45

Figure 2.11: Example of the indirect effect of Exchange Rate on Inflation – The Supply Side ……… 45

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Figure 2.13: Example of the indirect effect of Fixed Exchange Rate on

Investment ……… 48

Figure 2.14: Example of the indirect effect of Floating Exchange Rate on Investment (1) ……….. 49

Figure 2.15: Example of the indirect effect of Floating Exchange Rate on Investment (2) ………..……… ₄₉

Figure 2.16: Example of the Export Revenue Channel ..………. 51

Figure 2.17: Example of the Import Cost Channel ... 52

Figure 2.18: Shape of a J-Curve ………... 53

Figure 2.19: The Different Stages of Regional Integration ……….. 58

Figure 2.20: ASEAN -10 member Countries Map ……….. 63

Figure 2.21: Map of the ECOWAS-15 ……… 64

Figure 3.1: Empirical studies and theories used ……….. 65

Figure 3.2: Logical Framework ………... 75

Figure 4.1: Order of the Correlation Analysis for ASEAN-10 and ECOWAS 15 economies ... ₉₀

Figure 4.2: The Correlation Map’s Design for ASEAN ... 94

Figure 4.3: The Correlation Map’s Design for ECOWAS... 94

Figure 5.1.1: Scatter Diagram andtrend line of GDP growth and exchange rate in ASEAN ... 99

Figure 5.1.2: Comparison of the correlation level between exchange rate and GDP in ASEAN-10 ... ₉₉

Figure 5.1.3: Scatter Diagram andtrend line of Inflation and exchange rate in ASEAN ... 101

Figure 5.1.4: Comparison of the correlation level between exchange rate and inflation in ASEAN-10 ... 102

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Figure 5.1.6: Comparison of the correlation level between exchange rate and

FDI in ASEAN-10 ... ₁₀₄

Figure 5.1.7: Scatter Diagram andtrend line of unemployment and exchange

rate in ASEAN ... 107

unemployment in ASEAN-10 ... 107

Figure 5.1.9: Scatter Diagram andtrend line of trade balance and exchange rate

ASEAN ... 110

trade balance in ASEAN-10 ... 110

Figure 5.1.11: Recapitulation of the results obtained from the correlation test

for ASEAN-10 ... 113

Figure 5.2.1: Scatter Diagram andtrend line of GDP and exchange rate in

ECOWAS ... 116

GDP in ECOWAS-15 117

Figure 5.2.3: Scatter Diagram andtrend line of Inflation and exchange rate in

ECOWAS ... 119

Inflation in ECOWAS-15 ... 120

Figure 5.2.5: Scatter Diagram andtrend line of FDI and exchange rate in

ECOWAS ... 122

FDI in ECOWAS-15 ... 123

Figure 5.2.7: Scatter Diagram andtrend line of unemployment and exchange

rate in ECOWAS ... 125

unemployment in ECOWAS-15 ... ₁₂₆

Figure 5.2.9: Scatter Diagram andtrend line of trade balance and exchange rate

in ECOWAS ... 128

unemployment in ECOWAS-15 ... ₁₂₉

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Figure 6.1a: Mapping of the correlation between Exchange Rate and GDP

growth in ASEAN-10 from 1990-2014 ... 139

Figure 6.1.1: Evolution of Exchange rate and GDP growth in Laos, 1990-2014 140 Figure 6.1.2: Evolution of Exchange rate and GDP growth in Vietnam,

1990-2014 ... 141

Figure 6.1.3: Evolution of Exchange rate regime in Vietnam, 1990-2014 ... 142 Figure 6.1.4: Vietnam Major Partner Concentration of Commodities Trade

(2010-2013) ... 142

Figure 6.1.5: Vietnam as a Major Source and Host of Foreign Investment in

Percentage, 2013 ... ₁₄₃

Figure 6.1.6: Evolution of Exchange rate and GDP growth in Indonesia,

1990-2014 ... 145

Figure 6.1.7: Evolution of Exchange rate regimes in Indonesia, 1990-2014 ... 146 Figure 6.1.8: Indonesian Commodities Exports Shares in Percentage in 2013 ... 147 Figure 6.1.9: Indonesian Commodities Imports Shares in Percentage in 2013 ... 148 Figure 6.1.10: Indonesian Major Partner Concentration of Commodities Trade

(2010-2013) ... 149

Figure 6.1.11: Evolution of Exchange rate regime in Philippines, 1990-2014 .... 150 Figure 6.1.12: Evolution of Exchange rate and GDP growth in Philippines,

1990-2014 ... ₁₅₁

Figure 6.1.13: Philippines’s Services Sector, 1990,1999 and 2014 Value

Added (% of GDP) ... 152

Figure 6.1.14: Evolution of Exchange rate and GDP growth in Thailand,

1990-2014 ... 153

Figure 6.1.15: Thailand Major Partner Concentration of Commodities Trade

(2010-2013) ... 154

Figure 6.1.16: Evolution of Exchange rate regimes in Brunei & Singapore,

1990-2014 ... 155

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Figure 6.1.18: Myanmar’s Agriculture Sector, 1990,1999 and 2014 Value

Added (% of GDP) ... ₁₅₇

Figure 6.1.19: Singapore’s Service Sector, 1990,1999 and 2014 Value Added

(% of GDP) ... ₁₅₈

Figure 6.1.20: Singaporean Commodities Exports Shares in Percentage in 2013 159 Figure 6.1.21: Evolution of Exchange rate regime in Singapore, 1990-2014 ... 160 Figure 6.1.22: Malaysia’s Industry Sector, 1990,1999 and 2014 Value Added

(% of GDP) ... ₁₆₁

Figure 6.1.23: Evolution of Exchange rate regime in Malaysia, 1990-2014 ... 162 Figure 6.1.24: Malaysian Commodities Exports Shares in Percentage in 2013 .. 163

Figure 6.1b: Mapping of the correlation between Exchange rate and Inflation

in ASEAN-10 from1990-2014 ... 166

Figure 6.1.25: Evolution of Exchange rate regimes in Indonesia, 1990-2014 ... 167 Figure 6.1.26: Evolution of Exchange rate and Inflation in Vietnam, 1990-2014 169 Figure 6.1.27: Evolution of Exchange rate regimes in Thailand, 1990-2014 ... 171 Figure 6.1.28: Low Interest Rates in Thailand compared to US Fed Funds rate

in 1990, 1999 and 2014 ... ₁₇₂

Figure 6.1.29: Evolution of Exchange rate and Inflation in Thailand,

1990-2014 ... 172

Figure 6.1.30: Thailand Major Partner Concentration of Commodities Trade

(2010-2013) ... ₁₇₃

Figure 6.1.31: Thailand Commodities Imports Shares in Percentage in 2013 .... 173 Figure 6.1.32: Malaysia Commodities Exports Shares in Percentage in 2013 .... 174 Figure 6.1.33: Evolution of Exchange rate and Inflation in Singapore,

1990-2014 ... 176

Figure 6.1.34: Brunei Darussalam Commodities Imports Shares in Percentage

in 2013 ... 177

Figure 6.1.35: Evolution of Exchange rate and Inflation in Brunei, 1990-2014 . 177 Figure 6.1.36: Evolution of Exchange rate and Inflation in Philippines,

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Figure 6. 1.37: Trend of FDI/gdp and External major shocks in ASEAN-10,

1990-2014 ... ₁₈₁

Figure 6. 1.38: Intra-ASEAN-10 Major Investors (2010-2013) ... 182 Figure 6. 1.39: Average FDI/gdp of ASEAN-10, during period 1990-99 and

1999-2014 ... 183

Figure 6. 1.40: ASEAN-10 Major Foreign Direct Investors (2010-2013) ... 184

Figure 6.1c: Mapping of the correlation between Exchange Rate and FDI in

ASEAN-10 from 1990-2014 ... 185

Figure 6.1.41: Evolution of Exchange rate and FDI growth in Vietnam,

1990-2014 ... 186

Figure 6.1.42: Major Sources of Foreign Direct Investment in Vietnam

(2010-2013) ... 188

Figure 6.1.43: Vietnam, a major source of intra-ASEAN Investment

(2010-2013) ... ₁₈₉

Figure 6.1.44: Stability of Exchange rate regime in Vietnam, 1990-2014 ... 189 Figure 6.1.45: Major Sources of Foreign Direct Investments in Cambodia

(2010-2013) ... ₁₉₀

Figure 6.1.46: Evolution of Exchange rate and FDI growth in Laos, 1990-2014 192 Figure 6.1.47: Laos Major Foreign Direct Investors (2010-2013) ... 192 Figure 6.1.48: Indonesia’s Major Foreign Direct Investors (2010-2013) ... 195 Figure 6.1.49: European Union-28’ Major Hosts of Foreign Direct Investments

into ASEAN (2010-2013) ... 196

Figure 6.1.50: Intra-ASEAN Major Investors “without Indonesia” (2010-2013) 198 Figure 6.1.51: Thailand as a major Host of Foreign Direct Investments

(2010-2013) ... 200

Figure 6.1.52: Thailand as a major Source of Foreign Direct Investments in

ASEAN (2010-2013) ... ₂₀₁

Figure 6.1.53: Japan as a major Source of Foreign Direct Investments in

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Figure 6.1.54 : Major Sources of Foreign Direct Investments in Myanmar

(2010-2013) ... 203

Figure 6.1.55: Evolution of Exchange rate and FDI growth in Brunei

Darussalam, 1990-2014 ... ₂₀₄

Figure 6.1.56: Major Sources of Foreign Direct Investments in Malaysia

(2010-2013) ... ₂₀₆

Figure 6.1.57: Malaysia as major source of Intra-ASEAN Investment

(2010-2013) ... 207

Figure 6.1.58: The major sources of Investment in Philippines (2010-2013) ... 208 Figure 6.1.59: Evolution of Exchange rate arrangements in Philippines,

1990-2014 ... 209

Figure 6.1.60: Evolution of Exchange rate and FDI growth in Singapore,

1990-2014 ... 210

Figure 6.1.61 : Singapore Outstanding Performance of FDI/gdp among

ASEAN Economies ... 211

Figure 6.1.62: Major Sources of Foreign Direct Investments in Singapore

(2010-2013) ... ₂₁₂

Figure 6.1.63: Singapore as a major source of Foreign Direct Investments in

ASEAN (2010-2013) ... ₂₁₃

Figure 6.1.64 : Average Unemployment rate in ASEAN-10, during periods

1990-99 and 99-2014 ... 219

Figure 6.1d: Mapping of the correlation between Exchange Rate and

Unemployment in ASEAN-10 from 1990-2014 ... 220

Figure 6.1.65 : Indonesia Major Partner Concentration of Commodities Trade

(2010-2013) ... ₂₂₁

Figure 6.1.66 : Evolution of Exchange rate and Unemployment in Thailand,

1990-2014 ... ₂₂₄

Figure 6.1.67 : Thailand Major Partner Concentration of Commodities Trade

(2010-2013) ... ₂₂₅

Figure 6.1.68 : Evolution of Exchange rate and Unemployment in Philippines,

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Figure 6.1.69 : Philippines Major Partner Concentration of Commodities Trade

(2010-2013) ... ₂₂₇

Figure 6.1.70 : Malaysia Major Partner Concentration of Commodities Trade

(2010-2013) ... ₂₂₈

Figure 6.1.71 : Evolution of Exchange rate and Unemployment in Singapore,

1990-2014 ... 229

Figure 6.1.72 : Transmission channel between exchange rate, competitiveness

and unemployment ... ₂₃₀

Figure 6.1e: Mapping of the correlation between Exchange Rate and Trade

Balance in ASEAN-10 ... 233

Figure 6.1.73: Evolution of Exchange rate and Current Account in Indonesia,

1990-2014 ... ₂₃₅

Figure 6.1.74: Shares of Commodities Exported and Imported by Indonesia,

2013 ... ₂₃₅

Figure 6.1.75 : Evolution of Exchange rate and Current Account in Vietnam,

1990-2014 ... 237

Figure 6.1.76 : Shares of Commodities Exported and Imported by Vietnam,

2013 ... ₂₃₈

Figure 6.1.77 : Evolution of Exchange rate and Current Account in Laos,

1990-2014 ... ₂₃₉

Figure 6.1.78 : Shares of Commodities Exported and Imported by Singapore,

2013 ... 240

Figure 6.1.79 : Evolution of Exchange rate and Current Account in Singapore,

1990-2014 ... ₂₄₁

Figure 6.1.80 : Evolution of Exchange rate and Current Account in Brunei,

1990-2014 ... ₂₄₂

Figure 6.1.81 : Shares of Commodities Exported and Imported by Brunei

Darussalam, 2013 ... 243

Figure 6.2.1: Exchange rate Movements in ECOWAS-15 countries 1990-99 to

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Figure 6.2.2: Evolution of Exchange rate regimes in 8 countries of the

WAEMU, 1990-2014 ...

250 Figure 6.2.3: ECOWAS’ Agriculture Sector, 1990,1999 and 2014 Value

Added (% of GDP) ... 252

Figure 6.2.4: ECOWAS’ Industry Sector, 1990,1999 and 2014 Value Added

(% of GDP) ... ₂₅₃

Figure 6.2.5: ECOWAS’ Service Sector, 1990,1999 and 2014 Value Added (%

of GDP) ... ₂₅₄

Figure 6.2.6: Agricultural and Mineral resources as largest Commodities

Exports Shares in 2013 ... ₂₅₅

Figure 6.2a: Mapping of the correlation between Exchange Rate and GDP

growth in ECOWAS-15 from 1990-2014 ... 257

Figure 6.2.7: Average Real GDP growth of ECOWAS-15, during period

1990-99 and 1990-99-2014 ... 258

Figure 6.2.8: Sierra Leone’ Agriculture Sector, 1990,1999 and 2014 Value

Added (% of GDP) ... ₂₆₀

Figure 6.2.9: Sierra Leone’s Average Real GDP growth compared to other

ECOWAS-15 ... ₂₆₁

Figure 6.2.10: Evolution of Exchange rate and GDP growth in Sierra Leone,

1990-2014 ... ₂₆₁

Figure 6.2.11: Evolution of Exchange rate regimes in Guinea, 1990-2014 ... 262 Figure 6.2.12: Evolution of Exchange rate and GDP growth in Guinea,

1990-2014 ... 262

Figure 6.2.13: Evolution of Exchange rate regimes in Cape Verde, 1990-2014 264 Figure 6.2.14: Evolution of Exchange rate and GDP growth in Cape Verde,

1990-2014 ... ₂₆₅

Figure 6.2.15: Cape Verde’s Services Sector, 1990,1999 and 2014 Value

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Figure 6.2.16: Evolution of Exchange rate and GDP growth in Cote d’Ivoire,

1990-2014 ... 267

Figure 6.2.17: Evolution of Exchange rate regimes in Ghana, 1990-2014 ... 270 Figure 6.2.18: Evolution of Exchange rate regimes in Nigeria, 1990-2014 ... 271 Figure 6.2.19: Average Real GDP growth of Ghana & Nigeria, during period

1990-99 and 99-2014 ... ₂₇₂

Figure 6.2.20: 1990 Ghana & Nigeria’s Value Added (% of GDP) from

Agriculture, Industry and Service ... 273

Figure 6.2.21: 2014 Ghana & Nigeria’s Value Added (% of GDP) from

Agriculture, Industry and Service ... 273

Figure 6.2.22 : Mineral Fuels, the major export-commodity of Nigeria, 2013 ... 274

Figure 6.2b: Mapping of the correlation between Exchange Rate and Inflation

in ECOWAS-15 from 1990-2014 ... 276

Figure 6.2.23: Evolution of Exchange rate and Inflation in Sierra Leone,

1990-2014 ... ₂₇₇

Figure 6.2.24: Evolution of Exchange rate and Inflation in Guinea, 1990-2014.. 278 Figure 6.2.25: Inconsistent Evolution of Exchange rate regimes in Guinea,

1990-2014 ... ₂₇₉

Figure 6.2.26: Inflation in Ghana and Nigeria, one of the highest rate in

ECOWAS 1999-2014 ... ₂₈₀

Figure 6. 2.27: Average Inflation of France and WAEMU, during period

1990-99 and 1990-99-2014 ... 283

Figure 6.2c: Mapping of the correlation between Exchange Rate and FDI in

ECOWAS-15 from 1990-2014 ... 286

Figure 6.2.28: Liberia’s Average FDI’s contribution to GDP in ECOWAS,

1990-99 and 99-2014 ... ₂₈₇

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Figure 6. 2.33: Low Interest Rates in Countries under Monetary Union

(WAEMU), 1990-2014 ... ₂₉₄

Figure 6.2.34: Average FDI’ share in Countries under Floating Regime and

WAEMU, 1990-2014 ... ₂₉₅

Figure 6.2.35: High Interest Rates in Countries under Floating Regime

Compared to US Fed Rates, 90-2014 ... ₂₉₆

Figure 6.2.36: European Union as the major source of Investments in

ECOWAS (2010-2013) ... ₂₉₈

Figure 6.2.37: China as the 3rd_{major source of Investments in ECOWAS}

(2010-2013) ... 299

Figure 6.2.38: South Africa and Morocco as a major source of Intra-Africa

Investments in ECOWAS (2013) ... 301

Figure 6.2.39 : USA, Europe and Intra-ECOWAS, major Partners among

Others (2010-2013) ... ₃₀₂

Figure 6.2.40: Evolution of Exchange rate and Unemployment in Cape Verde,

1990-2014 ... 303

Figure 6.2d: Mapping of the correlation between Unemployment and

Exchange Rate in ECOWAS-15 from 1990-2014 ... 304

Figure 6.2.41: Cape Verde and Nigeria, highest unemployment rates in

ECOWAS, 1999-2014 ... ₃₀₅

Figure 6.2.42 : Nigeria, major Exporter in ECOWAS and to other developed

Countries (2010-2013) ... ₃₀₆

Figure 6.2.43 : Major ECOWAS Importers of Manufactured Goods and

Machinery (2010-2013) ... ₃₀₇

Figure 6.2.44: Agriculture’s Value Added (% of GDP) among ECOWAS

States in 1990,1999 and 2014 ... ₃₀₉

Figure 6.2.45: Lagging Industry Sector’s Value Added (% of GDP) among

ECOWAS States in 2014 ... 310

Figure 6.2.46 : Major Exporters of Crude Mineral Fuels from ECOWAS

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Figure 6. 2.47: Average Current Account balance in ECOWAS, during period

1990-99 and 99-2014 ... ₃₁₄

Figure 6.2e: Mapping of the correlation between Trade Balance and Exchange Rate in ECOWAS-15 from 1990-2014 ... 315

Figure 6.2.48: Average Growth of International Prices (%) of Major Commodities, 1990-2014 ... ₃₁₇

Figure 6.2.49: Average Current Account deficit in most ECOWAS, during period 1990-2014 ... 320

Figure 6.2.50: Average Growth of Coffee’s International Prices (%), 90-2014 .. 321

Figure 6.2.51: Average Growth of Cotton’s International Prices (%), 1990-2014 ... ₃₂₂

Figure 6.2.52: Average Current Account Surplus in Cote d’Ivoire and Nigeria, 1990-2014 ... ₃₂₃

Figure 6.2.53: Nigeria’s major Exports and Imports Commodities (2013) ... 324

Figure 6.2.54: Average Growth of Crude Oil’s International Prices (%), 1990-2014 ... ₃₂₅

Figure 6.2.55: Average Growth of Cocoa’s International Prices (%), 1990-2014 ... ₃₂₆

Figure 6.2.56: Cote d’Ivoire’s major Trade Partners (2013) ... 327

Figure 6.2.56: Schema for Appropriate Exchange rate regime in ASEAN-10 and ECOWAS-15 327 Figure 6.3.1 Comparison between the Nominal Exchange rate and the INEX in Indonesia 90-2014 ... ₃₃₁

Figure 6.3.2 Comparison between the Nominal Exchange rate and the CNEX in Nigeria 1990-2014 ... ₃₃₄

Figure 6.3.3: ASEAN, Value Added (% of GDP ) by Sector in 1990 ... 339

Figure 6.3.4: ASEAN, Value Added (% of GDP ) by Sector in 2014 ... 339

Figure 6.3.5: ECOWAS, Value Added (% of GDP) by Sector in 1990 ... 339

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Figure 6.3.7 : Sectorial Integrated Clusters for Regional Employment in

ASEAN-10 ... 341

Figure 6.3.8: Sectorial Integrated Clusters for Regional Employment in

ECOWAS-15 ... ₃₄₁

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Abbreviations

ASEAN: Association of Southeast Asian Nations

CNEX Commodity Nominal Exchange rate

ECOWAS: Economic Community of West African States

FDI: Foreign Direct Investment

GDP: Gross Domestic Product

IMF: International Monetary Fund

INEX Inclusive Nominal Exchange rate

LCU/USD Local Currency Unit per United States dollar