BINDURA UNIVERSITY OF SCIENCE EDUCATION

Faculty of Commerce
Department Of Economics
PROJECT PROPOSAL







Name : Tatenda Phiri
Registration number : B1025589
Programme : Bachelor of Science (Honours) Economics
Supervisor : Mr Muchingami
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Table of contents
Title........................................................................................................................................ 3
Introduction............................................................................................................................ 4
Background of the study........................................................................................................ 5
Problem statement.................................................................................................................. 6
Significance of the study........................................................................................... ............ . 6
Objectives.............................................................................................................................. 6
Literature Review..................................................................................................... ............ 7
Research Questions................................................................................................................ 8
Statement of Hypothesis...................................................................................... ............ 8
Research Methodology.......................................................................................................... 8
Model specifications.................................................................................... ........................ 9
Organisation of the study....................................................................................................... 10
References........ ..................................................................................................................... 11


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Title
The impact of import export ratio on the Gross Domestic Product in
Zimbabwe (January 2009-December 2012)


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Introduction


5


Background of the study
This study will be basically undertaken to evaluate the impact of imports exports ratio on
the Gross Domestic Product (GDP) of the economy of Zimbabwe. The GDP will be a
function of investment, government expenditure, private expenditure and. During the period
of February 2009 up to date imports have outweighed exports, this can be largely attributed to
the collapse of the domestic market to manufacture and expand their production. The import-
export ratio has been widening due to the fact that the imports are increasing in the form of
capital goods meant for being a catalyst in the economic growth while exports continue to
contradict. After Zimbabwes independence in 1980 exports had always expanded till early
2000, this was due to the vibrant agricultural sector which included cash crops tobacco,
cotton and horticulture. The agriculture sector is estimated to contribute between 15%-18%
of GDP. However production in the agriculture sector has been downward trending in the
recent years, cash crops production has been fluctuating resulting in the country suffering a
backlash in its exports. The mining sector has become the main source of export accounting
for nearly over 50% of the total exports. This was through the discovery of the diamond
fields in Marange community.

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Problem statement




Significance of the study
This study is significant in the followings ways:
The study would serve as a mark for determining the extent to which the import-
export ratio has on the economy vibrant.
It would also contribute to existing literature on the subject matter by investigating
empirically the causation between the Zimbabwean GDP and the countrys import
and export ratio.
Lastly, it would be a veritable tool for investors, business students and any other
persons who wish to know more about the impact of the imports-exports ratio to GDP
ofZimbabwe

It would provide policy recommendation to policy makers on implementing vibrant
import and import policies that are conjunctive to a health GDP of Zimbabwe.
Research Objectives
The focus of this research project will be to analyse the relationship between import-export
ratio and GDP of the Zimbabwean economy. The other objectives are:
1. To evaluate the efficiency of the import-export ratio to the economy of Zimbabwe.
2. To assess whether the import-export ratio can be a determinant to the GDP of the
economy of Zimbabwe.
3. To find out the significance of imports and exports to the whole economy of
Zimbabwe.
4. To identify the factors that hinder an import-export ratio that is favorable to a vibrant
GDP of Zimbabwe and make suggestions on how they could be resolved.


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.
Research questions
The researcher seeks to answer the following research questions:
1. What is the relationship that exists between international trade taking into consideration
imports and exports only and the GDP of Zimbabwe?
2. How efficient is the impact of the import-export ratio and economic activity in Zimbabwe?
3. Can the imports-exports ratio be a determinant of the GDP of Zimbabwe?
4. To what extent do Zimbabwes GDP rely on the imports-exports ratio?
5. What are the factors that hinder an imports-exports ratio that is vibrant to the GDP of
Zimbabwe?

Statement of hypothesis
The hypothesis that would be tested in the course of this research is stated below as:
H
0
: That the import export ratio has an impact to the GDP.
H
1
: That the import-export ratio has no impact to the GDP.














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Research methodology
The study will make use of the econometrics procedure in estimating the relationship between the
import-export ratio and the GDP of Zimbabwe. The Ordinary Least Squares technique shall be
employed in obtaining the numerical estimates of the coefficients in different equations. The Ordinary
Least Squares Method is chosen because it possesses some optimal properties its computational
procedure is fairly simple and it is also an essential component of most other estimation technique.
The estimation period covers the period from 2009 2012, since the data needed are available for this
period. The data for this study are obtained mainly from secondary sources, particularly from
Zimbabwe National Statistics Agency.


Model specifications
Model 1
.

Where;
GDP= Gross Domestic Product
Gvt=Government Expenditure
Pvt=Private Expenditure

=Parameters

=Error term.
Model 2
Organisation of the study
This study shall contain five chapters. The first chapter shall contain the background of the study, the
statement of the research problem, the objectives of the study, the research questions etc that would
guide the study. Chapter two would present the literature review on the subject matter. The
methodology to be adopted in the study would be stated in chapter three. Chapter four shall focus
on the presentation and interpretation of the regression results. The last chapter chapter five, would
present the summary of the findings, conclusion and appropriate recommendations.


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REFERENCES