Multi-Market Policy Modelling of Mutton Exports of Sudan

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Mohammed, Hanaa Abd Elazim Hassan
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The objectives of this study are to analyze the impact of the free trade on the mutton trade of Sudan to Saudi Arabia under different policy scenarios. Primary and secondary data was collected from responsible authorities and mutton exporters for the period of 1999-2002. The study used the PAM analysis tool to assess the extent of profitability, competitiveness and incentives for increased mutton exports. The study also, used the Multi-Market models to simulate the effect of liberalization policies such as those of removal of domestic and export taxes on enhancing exports of mutton from Sudan. The findings of the PAM analyses showed that mutton export was competitive on average for the period 1999-2002 when using markets prices of mutton. The PAM analyses also revealed that mutton commodity was profitable in financial and economic terms. Nevertheless, the economic profitability was higher than the financial profitability, implying the presence of direct and indirect taxes on the producers and exporters of mutton. The multi-market model simulation results indicated that an increase in mutton prices would lead to measurable gains in Sudan's mutton trade. In addition, it showed that an increase in the cost of production for any fiscal or monetary reason would reduce the benefits of exports of mutton of Sudan. Furthermore, the simulation explained that removal of domestic and export taxes had positive effects on increasing welfare benefits of exports of mutton on Sudan's mutton trade. The study recommended the organization of the livestock breeding and marketing system to reduce seasonality in supply in addition to the establishment of a reliable system of information, removal of the taxes would increase the mutton exports of Sudan.
June 2005
Market Policy