Impact of Devaluation on Exports: The Case of Afghanistan

The central theme of this paper is to investigate the impact of devaluation on Exports in Afghanistan over the period of 2008 to 2017. Exchange rate is one of the very important factors in managing trade flows in a country. Based on an economic theory, there is a strong relationship between Devaluation and Exports whether the exchange rate goes up, exports increases and the result would be surplus in balance of trade. The main finding of this paper is that both graphical analysis and regression analysis shows that there is a positive relationship between Exchange rate and Exports. Thus exchange rate can be one of the reasons for increasing exports in Afghanistan during 2008 to 2017.

Keywords:

Exchange Rate , Devaluation , Exports , Co-integration , Afghanistan , ARDL Model