The Effect of Foreign Trade on Economic Growth in Palestine

Bc. Maya Salamin

Diplomová práce

Abstract:

This study explores the impact of foreign trade on economic growth in Palestine over the 2001 to 2022 period. Given the critical role of trade in shaping economic performance, the study also accounts for the effects of Foreign Direct Investment (FDI) and inflation rate to obtain more comprehensive insights. Data were obtained from the Palestine Monetary Authority (PMA) and analyzed using Ordinary Least Squares (OLS) regression through Gretl software. The findings reveal that exports have a significant positive effect on Real GDP, while imports exert a negative impact. FDI and inflation rate were found to be statistically insignificant in influencing economic growth. Based on the results, it is recommended that Palestine promotes export activities to drive growth and carefully assess import policies to mitigate their adverse effects on the economy. Additionally, supporting local industries to reduce import dependency could help stabilize the trade balance, while efforts to diversify exports should remain a priority for sustainable economic growth. Although FDI and inflation did not show significant statistical influence on growth in this study, fostering a more favorable environment for Foreign Direct Investment and maintaining inflation stability should still be pursued as part of broader economic strategies.

Keywords

Exports, Real GDP, FDI, Inflation Rate, Foreign Trade, Imports, Palestine

Jazyk práce: angličtina

Datum vytvoření / odevzdání či podání práce: 27. 3. 2025

Obhajoba závěrečné práce

• Obhajoba proběhla 5. 6. 2025
• Vedoucí: prof. Ing. Mansoor Maitah, Ph.D. Ph.D.
• Oponent: Robert Koželský, externi

Česká zemědělská univerzita v Praze

Provozně ekonomická fakulta

Magisterský studijní program:
Economics and Management