The prospect of economic resurgence a blueprint for east africa's economic leap inspired by the USA and UAE

Abstract

This dissertation investigates the key economic drivers for UAE and USA from 1992 to 2022, the methods used to leverage their renewable and non-renewable resources and compare their path to economic sustainability to that of Kenya and Uganda as they aim for the same. The Auto-Regressive Distributed Lag econometric model was employed in the time series data sourced from reputable and reliable sources: The World Bank, UN and IMF, to analyze the long-run relationship between macroeconomic growth, government investment, government expenditure and human development on the individual countries. The results proved a positive relationship in USA suggesting an economic performance closely tied to the government investments, its spending patterns and the general wellbeing of its citizens. In contrast, there was no observable direct relationship between UAE’s capital wealth and the investment into certain capital stock. The largest drivers of its GDP were instead, the government’s spending on consumption and the revenue from oil, its principal resource. Kenya on the other hand appears to be experiencing growth without a corresponding development, all the variables except the HDI support growth, with a 1.61% augmentation of Kenya’s GDPc statistically associated with a 1% inverse relationship with its HDI. This is not quite the case for Uganda where the government’s spending on consumption is negatively reflected on its GDPc, its 0.2% increase coincides with a 1% decline on the GDPc. Diagnostic tests confirm the validity and reliability of the ARDL models, strengthening the robustness of these findings. The study highlights the importance of a sound policy making system and effective investment in principal resources in stabilizing a nation’s economy and its human development. Adopting such a system could help Kenya and Uganda break free from the reliance on a system ill-suited to their current needs, one that appears to undermine the implementation of policies that enhance industrialization and living standards. This study provides policymakers with valuable insights and an empirical support for drawing a blueprint for East Africa’s economic transformation. The findings in fact, offer a strategic model that could benefit the entire Sub-Saharan African region, in the ongoing conversation of an envisioned Economic Resurgence.