Impacts of Oil Price Volatility and Monetary Policy on Economic Performance Of Non-Oil Producing Countries in Africa

The study investigates the impacts of oil price volatility and monetary policy on the economic performance of Africa's non-oil producing countries. Economic performance is proxy for the GDP growth rate and monetary policy is proxy for the interest rate and money supply. The oil price volatility is developed through GARCH process. The study covers a period from 1982 to 2018 and Panel Auto regressive Distributed Lag PANEL-ARDL is applied. The results show that both oil price volatility and monetary policy have significant impact on the economic performance of these countries, however, while oil price volatility has negative and transitory effect, expansionary monetary policy is shown to have sustained significant impact on their economic performance. The uniqueness of the study majorly lies in its scope and methodology. Past studies have concentrated on oil exporting countries alone and they have been focusing much on the effects of oil price volatility on their growth without assessing the role of monetary policy. The study fills these gaps.