Determinants of Agricultural Trade Competitiveness in Zambia: A Time-Series Cointegration Analysis of Technology, Energy, Investment, Growth, Global Value Chains, and Institutional Quality (1990–2024)

Zambia’s agricultural sector employs over 60% of the rural workforce yet captures minimal value in international markets, exporting predominantly unprocessed primary commodities. Identifying which structural factors most strongly drive agricultural trade competitiveness, and how they interact over time, is essential for designing effective policy in a resource-rich but structurally underdeveloped economy. This study investigates the long and short-run determinants of agricultural trade competitiveness in Zambia over 1990-2024, examining the joint role of technological innovation, renewable and non-renewable energy consumption, foreign direct investment, economic growth, global value chain integration, and institutional quality. Annual time-series data are analyzed within an integrated econometric framework comprising Augmented Dickey–Fuller unit root tests, Autoregressive Distributed Lag (ARDL) bounds testing, a Vector Error Correction Model (VECM), Granger causality analysis, mediation analysis, and Fully Modified OLS for robustness. The results reveal that all seven determinants exert statistically significant long-run effects. Global value chain integration (β= 0.517, p < 0.01) and technological innovation (β = 0.462, p < 0.01) emerge as the dominant drivers, followed by economic growth (0.398), institutional quality (0.336), renewable energy (0.285), foreign direct investment (0.241), and a marginally negative effect of non-renewable energy (−0.172). The error correction term (−0.641, p < 0.001) implies that approximately 64% of deviations from long-run equilibrium are corrected within one year. Mediation analysis confirms that technological innovation operates partially through GVC participation (indirect effect = 0.238) and institutional capacity (0.147), while FDI partly enhances competitiveness through technological transfer. The findings indicate that agricultural competitiveness is system-driven rather than dependent on a single lever, supporting an integrated, sequenced policy strategy combining short-term institutional reform and medium-term infrastructure expansion and value-chain deepening. The study extends endogenous growth, national innovation systems, and global value chain theory to a low-institutional-capacity Sub-Saharan African setting and provides empirically grounded guidance for sustainable agricultural transformation.

agricultural trade competitiveness; technological innovation; global value chains; renewable energy; institutional quality; ARDL bounds testing; Zambia; sustainable agriculture

1. World Bank. World Development Indicators 2024; World Bank: Washington, DC, USA, 2024. [Google Scholar] [Crossref]

2. FAO. FAOSTAT Statistical Database; Food and Agriculture Organization of the United Nations: Rome, Italy, 2024. [Google Scholar] [Crossref]

3. Ayim, C.; Asante, K.; Awal, M.; Kassim, T. ICT adoption, market information and agricultural performance in West Africa: Evidence from Ghana. Inf. Technol. Dev. 2022, 28, 481–505. [Google Scholar] [Crossref]

4. Mizik, T. Agricultural exports and value addition: A review of competitiveness measures. Agriculture 2021, 11, 1080. [Google Scholar] [Crossref]

5. Choruma, D.J.; Dirwai, T.L.; Mutenje, M.J. Digitalisation in Sub-Saharan African agriculture: A systematic scoping review. Agric. Syst. 2024, 215, 103857. [Google Scholar] [Crossref]

6. Porteous, O. Trade and agricultural supply chains in Africa. Am. J. Agric. Econ. 2020, 102, 1414–1437. [Google Scholar] [Crossref]

7. Chisanga, B.; Odhiambo, N.M. Agricultural R&D, extension and productivity in Zambia: A policy review. Dev. South. Afr. 2021, 38, 421–438. [Google Scholar] [Crossref]

8. Jayne, T.S.; Chamberlin, J.; Headey, D.D. Land tenure, customary systems, and investment incentives in Sub-Saharan Africa. World Dev. 2019, 122, 414–429. [Google Scholar] [Crossref]

9. Ruzzante, S.; Labarta, R.; Bilton, A. Adoption of agricultural technology in the developing world: A meta-analysis of the empirical literature. World Dev. 2021, 146, 105599. [Google Scholar] [Crossref]

10. Nin-Pratt, A.; Yu, B. An Updated Look at the Recovery of Agricultural Productivity in Sub-Saharan Africa; IFPRI Discussion Paper 00787; International Food Policy Research Institute: Washington, DC, USA, 2008. [Google Scholar] [Crossref]

11. Apergis, N.; Payne, J.E. Renewable and non-renewable energy consumption-growth nexus: Evidence from a panel error correction model. Energy Econ. 2012, 34, 733–738. [Google Scholar] [Crossref]

12. Kahia, M.; Aïssa, M.S.B.; Lanouar, C. Renewable and non-renewable energy use and economic growth: Evidence from MENA Net Oil Exporting Countries. Renew. Sustain. Energy Rev. 2019, 105, 412–425. [Google Scholar] [Crossref]

13. Usman, O.; Akadiri, S.S.; Adeshola, I. Role of renewable energy and globalisation on ecological footprint in the USA: Implications for environmental sustainability. Environ. Sci. Pollut. Res. 2021, 28, 30681–30693. [Google Scholar] [Crossref]

14. Porter, M.E.; van der Linde, C. Toward a new conception of the environment-competitiveness relationship. J. Econ. [Google Scholar] [Crossref]

15. Perspect. 1995, 9, 97–118. [Google Scholar] [Crossref]

16. Sadorsky, P. Trade and energy consumption in the Middle East. Energy Econ. 2011, 33, 739–749. [Google Scholar] [Crossref]

17. Shahbaz, M.; Lean, H.H.; Farooq, A. Natural gas consumption and economic growth in Pakistan. Renew. Sustain. Energy Rev. 2013, 18, 87–94. [Google Scholar] [Crossref]

18. Narayan, P.K.; Smyth, R. Energy consumption and real GDP in G7 countries: New evidence from panel cointegration with structural breaks. Energy Econ. 2008, 30, 2331–2341. [Google Scholar] [Crossref]

19. Borensztein, E.; De Gregorio, J.; Lee, J.-W. How does foreign direct investment affect economic growth? J. Int. Econ. 1998, 45, 115–135. [Google Scholar] [Crossref]

20. Blomström, M.; Kokko, A. Multinational corporations and spillovers. J. Econ. Surv. 1998, 12, 247–277. [Google Scholar] [Crossref]

21. Gui-Diby, S.L.; Renard, M.-F. Foreign direct investment inflows and the industrialization of African countries. World Dev. 2015, 74, 43–57. [Google Scholar] [Crossref]

22. Ibrahim, M.; Musah, A.; Sare, Y.A. Foreign direct investment and agricultural development in Sub-Saharan Africa. Cogent Econ. Finance 2022, 10, 2049477. [Google Scholar] [Crossref]

23. Jordaan, A.C. Estimating FDI-induced spillovers: Manufacturing-sector evidence. S. Afr. J. Econ. Manag. Sci. 2004, 7, 273–291. [Google Scholar] [Crossref]

24. Lucassen, M.; Vreeker, R. Net FDI inflows and export performance in developing economies. Appl. Econ. 2018, 50, 5234–5247. [Google Scholar] [Crossref]

25. Alfaro, L. Foreign Direct Investment and Growth: Does the Sector Matter?; Harvard Business School Working Paper; Harvard Business School: Boston, MA, USA, 2003. [Google Scholar] [Crossref]

26. Balassa, B. Trade liberalisation and ‘revealed’ comparative advantage. Manch. Sch. 1965, 33, 99–123. [Google Scholar] [Crossref]

27. Balassa, B. Exports and economic growth: Further evidence. J. Dev. Econ. 1978, 5, 181–189. [Google Scholar] [Crossref]

28. Feder, G. On exports and economic growth. J. Dev. Econ. 1982, 12, 59–73. [Google Scholar] [Crossref]

29. Awokuse, T.O. Does agriculture really matter for economic growth in developing countries? Am. J. Agric. Econ. 2009, 91, 1413–1419. [Google Scholar] [Crossref]

30. Gollin, D. Agricultural productivity and structural transformation in low-income economies. Annu. Rev. Econ. 2023, 15, 309–332. [Google Scholar] [Crossref]

31. Gereffi, G.; Humphrey, J.; Sturgeon, T. The governance of global value chains. Rev. Int. Polit. Econ. 2005, 12, 78–104. [Google Scholar] [Crossref]

32. Kummritz, V.; Taglioni, D.; Winkler, D.E. Economic upgrading through global value chain participation. World Bank Policy Res. Work. Pap. 2017, 8007. [Google Scholar] [Crossref]

33. Koopman, R.; Wang, Z.; Wei, S.-J. Tracing value-added and double counting in gross exports. Am. Econ. Rev. 2014, 104, 459–494. [Google Scholar] [Crossref]

34. Zhang, Y.; Sun, X. Global value chain participation and agricultural total factor productivity. China Agric. Econ. Rev. 2023, 15, 712–734. [Google Scholar] [Crossref]

35. Nas, B. Agricultural global value chain participation and trade performance: Evidence from Turkey. Agric. Econ. 2025, 56, 145–161. [Google Scholar] [Crossref]

36. Takawira, F.; Mujuru, M. A bibliometric and systematic review of global agricultural value chain research. Sustain. Prod. [Google Scholar] [Crossref]

37. Consum. 2024, 45, 488–503. [Google Scholar] [Crossref]

38. Bair, J. Global value chains and economic upgrading: A theoretical synthesis. Glob. Netw. 2012, 12, 1–14. [Google Scholar] [Crossref]

39. De Marchi, V.; Alford, M. Innovation and upgrading in global value chains: A systematic review. J. Econ. Geogr. 2022, 22, 589–614. [Google Scholar] [Crossref]

40. North, D.C. Institutions, Institutional Change and Economic Performance; Cambridge University Press: Cambridge, UK, 1990. [Google Scholar] [Crossref]

41. Acemoglu, D.; Johnson, S.; Robinson, J.A. The colonial origins of comparative development: An empirical investigation. Am. Econ. Rev. 2001, 91, 1369–1401. [Google Scholar] [Crossref]

42. Kaufmann, D.; Kraay, A.; Mastruzzi, M. The Worldwide Governance Indicators: Methodology and analytical issues. Hague J. Rule Law 2011, 3, 220–246. [Google Scholar] [Crossref]

43. Muchie, M. Institutional quality and agricultural innovation in Sub-Saharan Africa. Afr. J. Sci. Technol. Innov. Dev. 2019, 11, 597–609. [Google Scholar] [Crossref]

44. Ricker-Gilbert, J.; Jayne, T.S. Estimating the enduring effects of fertiliser subsidies on commercial fertiliser demand in Zambia and Malawi. J. Agric. Econ. 2017, 68, 70–97. [Google Scholar] [Crossref]

45. Qi, M. Trade liberalisation, governance and agricultural greening: A panel analysis. Sustainability 2024, 16, 2891. [Google Scholar] [Crossref]

46. Romer, P.M. Endogenous technological change. J. Polit. Econ. 1990, 98, S71–S102. [Google Scholar] [Crossref]

47. Aghion, P.; Antonin, C.; Bunel, S. The Power of Creative Destruction; Harvard University Press: Cambridge, MA, USA, 2021. [Google Scholar] [Crossref]

48. Freeman, C. The national system of innovation in historical perspective. Camb. J. Econ. 1995, 19, 5–24. [Google Scholar] [Crossref]

49. Lundvall, B.-Å. National innovation systems in a globalised digital economy. Camb. J. Econ. 2022, 46, 789–808. [Google Scholar] [Crossref]

50. Pesaran, M.H.; Shin, Y.; Smith, R.J. Bounds testing approaches to the analysis of level relationships. J. Appl. Econom. 2001, 16, 289–326. [Google Scholar] [Crossref]

51. Baron, R.M.; Kenny, D.A. The moderator–mediator variable distinction in social psychological research. J. Pers. Soc. Psychol. 1986, 51, 1173–1182. [Google Scholar] [Crossref]

52. Sobel, M.E. Asymptotic confidence intervals for indirect effects in structural equation models. Sociol. Methodol. 1982, 13, 290–312. [Google Scholar] [Crossref]

53. Nguyen, T.T.; Grote, U.; Sharma, R. Composite indicators for measuring agricultural innovation: A methodological review. Agric. Econ. 2022, 53, 489–505. [Google Scholar] [Crossref]

54. Gujarati, D.N.; Porter, D.C. Basic Econometrics, 5th ed.; McGraw-Hill: New York, NY, USA, 2009. [Google Scholar] [Crossref]

55. Wooldridge, J.M. Introductory Econometrics: A Modern Approach, 6th ed.; Cengage: Boston, MA, USA, 2016. [Google Scholar] [Crossref]

56. Stock, J.H.; Watson, M.W. Introduction to Econometrics, 4th ed.; Pearson: New York, NY, USA, 2020. [Google Scholar] [Crossref]

57. FAO. Zambia Country Programme Framework 2022–2026; Food and Agriculture Organization: Rome, Italy, 2022. [Google Scholar] [Crossref]

58. Zambia Statistics Agency. Living Conditions Monitoring Survey 2021; ZISA: Lusaka, Zambia, 2021. [Google Scholar] [Crossref]

59. International Telecommunication Union. Measuring Digital Development: Facts and Figures 2023; ITU: Geneva, Switzerland, 2023. [Google Scholar] [Crossref]

60. Muzari, W.; Gatsi, W.; Muvhunzi, S. The impacts of technology adoption on smallholder agricultural productivity in Sub-Saharan Africa: A review. J. Sustain. Dev. 2012, 5, 69–77. [Google Scholar] [Crossref]

61. Spielman, D.J.; Birner, R. How Innovative Is Your Agriculture?; World Bank Agriculture and Rural Development Discussion Paper 41; World Bank: Washington, DC, USA, 2008. [Google Scholar] [Crossref]

• Impact of Foreign Direct Investment in India
• Issues Involved in Digitalisation Special Reference to Indian Tourism Growth
• Relationship Marketing and Customer Loyalty in the Fast-Moving Consumer Goods (FMCG) Industry in Nairobi County
• Financial Literacy or Financial Inclusion? Which is Which, What is What—To Achieve Uganda’s 10-Fold Economic Growth By 2040
• Harnessing Natural Gas for Economic Transformation: Overcoming the Regulatory and Infrastructural Bottlenecks in Nigeria