Customs Union Among Uemoa Countries : A Quantitative Assessment

In this paper, we evaluate the potential effects of a customs union's create among the UEMOA (West-African Economic and Monetary Union) countries. We develop a computable static and multi-country general equilibrium model to analyze the reform's impact in each country. Our simulation results highlight a diversity in the gains and the required adjustment within the union members. The reform is welfare-improving in almost every country, and it has a positive impact on regional and non-regional trade flows, with a redistribution of foreign savings within the union. Our results also point out a trade-off between welfare gain and the loss of tariff revenues. The complete removal of tariffs within the union and the application of common external tariffs induce painful adjustments in government finances, in many countries