Making the Worst of a Bad Situation: A Note on Irexit

Why carbon leakage matters and what can be done against it

The Gravity Model considered one of the important models in foreign trade, because it is used to explain the most important determinants of the state export of it’s exporting goods and determine competitive state for exports of the country in world market of its exports, besides it give an idea about most important countries in exporting export goods. The study aims to determine most important factors affecting on flow of Iraqi skins to world market, and measuring influence of these factors and determine suitable model to understand most important determinants of foreign trade of Iraqi skins with most important trading partners. The study proved that per capita of GDP, quantity of commodity produced by country, quantity of commodity exports from country to global market and export price (FOB) of commodity, were the most important determinants of flow of Iraqi skins to global market, because these factors formed about (%53) of determinants of flow of Iraqi skins to global market. By analyzing the model of most important determinants of flow of Iraqi skins with most important trading partners (Jordan and UAE), the study found that the most important determinants of flow of Iraqi skins with most important trading partners were per capita of GDP representing economic size of two partners, number of population in two partners and the distance between trading capitals of them with invers sign. These factors compatible with gravity trade model between states, and these factors determine (%89) of happening changes in flow of Iraqi skins to most important trading partners.

Previous studies of the effects of exchange rate changes on Czechia’s trade balance have assumed symmetric effects on the trade balance or assumed its linear adjustment. The aim of this article is to evaluate the asymmetric effects of the CZK/EUR exchange rate on the most important segment of Czechia’s foreign trade. The period from 1999 to 2014 was analyzed, and the data was disaggregated according to trading partner and product category. The results of the study show that exchange rate comovement with partial trade balances is mostly confirmed by employing both applied approaches. However, the asymmetry cointegration approach, which introduces nonlinearity into the model, reveals a more significant impact of the exchange rate on commodity trade between Czechia and its most important trading partners than a more standard model that imposes symmetry. Furthermore, distinguishing between depreciation and appreciation showed that the effects at the industry level are, in fact, asymmetrical in most industries when assessing Czechia’s bilateral trade with its most important trading partners.

Individuals tend to favor important trade partners in their foreign policy preferences. Cultural affinity is also known to influence individuals’ foreign policy stances. This study examines how citizens prioritize international relations with trading partners in the face of ethnolinguistic divisions. Using survey data on foreign policy preferences paired with data on bilateral trade between Ukraine and its two largest trade partners (Russia and the European Union [EU]), I find that ethnolinguistic identity and relative trade exposure both affect foreign policy preferences and that these effects introduce cross-cutting cleavages. Ukrainian-speaking Ukrainians in regions where the economic importance of trade with Russia is relatively higher are more likely to favor foreign policy oriented toward Russia than Ukrainian speakers elsewhere. Similarly, Russian speakers in areas with high levels of trade with the EU have more EU-oriented foreign policy preferences.

The importance of international trade in the context of refrigerator products makes intra-industry trade intensity (IIT) a very relevant tool. In international trade policymaking, particularly concerning refrigerator products, IIT is essential for understanding global economic dynamics, trade patterns, and trade relations between Indonesia and its trading partners. The use of IIT can provide deep insights into the extent to which there is an exchange of similar or similar but different goods among countries involved in the trade of refrigerator products. Therefore, the focus of the problem in this context is the extent to which the Indonesian refrigerator industry depends on ten trading partners in terms of exports and imports of refrigerator products and how this degree of dependence affects the stability of the sector in the face of changing global trade conditions. Regarding exports, India is the most important trading partner with a significant contribution, indicating a dependency that requires special attention. India has also emerged as an essential supplier, albeit with a lower level of dependence. Diversifying export and import markets should be considered to reduce the risk of dependence on certain trading partners. IIT analysis can also provide insights into the competitiveness of Indonesian products in the international market —improvement of export success also depends on understanding intra-industry trade dynamics.

The article elucidates the internal problems of Uzbekistan among which one should mention the problem of poverty, mass unemployment, shortage of arable land and water resources, serious ecological problems. To a high degree these problems have been caused by a rapid growth of population. Uzbekistan tries to solve these problems by means of liberal market reforms and the multi-vector foreign policy developing political, economic and trade relations at the same time with different countries, in particular with China, the USA, the EU, Turkey, South Korea, Russia and other countries-members of the Eurasian Economic Union (EAEU). It was shown that volumes of trade of Uzbekistan with the Western countries as well as the level of Western investments remain at least now not high. The conclusion is drawn that for the USA Uzbekistan presents the interest mainly in geopolitical, military and strategic aspects, especially now after the US troops left Afghanistan. The EU is more than the USA interested in developing the trade and economic relations with Uzbekistan. The new agreement between Uzbekistan and the EU on enlarged partnership and cooperation will create more favorable conditions for economic cooperation and trade, growth of European investments into economy of Uzbekistan. Nevertheless it seems that the factor of geographic remoteness of Uzbekistan from Europe will not make it possible for the EU countries to occupy the same place in external economic links of Uzbekistan as the countries-neighbours such as China, Russia and other countries-members of the EAEU. It is shown that China is the most important trade and economic partner of Uzbekistan. China considers Uzbekistan as the important transit country with transport corridors indispensable for transportation first of all of Chinese goods to the countries of Europe and other regions of the world. The Chinese investments into economy of Uzbekistan are constantly growing. The Eurasian Economic Union (EAEU), in particular Russia and Kazakhstan, is also the most important trade and economic partner of Uzbekistan. Besides, Russia is the biggest labour market for millions of Uzbek migrant workers. Within the EAEU the common labour market was created, migrant workers who are citizens of the countries-members of the EAEU enjoy the social rights of the country of stay and may freely move over territories of the countries-members of the EAEU. This fact is especially important for Uzbekistan which is interested in improving living conditions of its migrant workers. Besides, as the facts show, the economic integration within the EAEU does not prevent the governments of the countries-members of the EAEU from developing intensive political and economic relations with different countries. Taking into account the complex of acute socio-economic, ecological and demographic problems facing Uzbekistan it seems that in the future one cannot completely exclude the possibility of membership of Uzbekistan in the EAEU especially if such a membership does not prevent the Uzbek government from pursuing the multi-vector foreign policy. The parliament of Uzbekistan approved the decision to obtain the status of observer at the EAEU. The EAEU granted this status to Uzbekistan in December 2020.

The U.S.-Taiwan Commercial Relationship:Moving toward a Free Trade Agreement? Scott L. Kastner (bio) The past few years have been a golden age for the U.S.-Taiwan relationship. Security cooperation between Washington and Taipei has deepened, the U.S. Congress has passed legislation such as the Taiwan Travel Act that codifies closer ties, the American Institute in Taiwan has opened a huge new facility in Taipei, and the United States has approved extended stopover visits by Taiwan's president, including in New York City. Now, many in both Washington and Taipei argue that the two sides should seek similar advances in the bilateral economic relationship by opening negotiations on a U.S.-Taiwan free trade agreement (FTA). Some members of Congress have been outspoken in support of a bilateral FTA, and the Senate version of the Taiwan Assurance Act introduced in 2019 sets this as a goal.1 Likewise, a growing number of U.S. observers have advocated for a bilateral FTA.2 As for Taiwan's position on this issue, President Tsai Ing-wen views a U.S.-Taiwan FTA as an important priority.3 This essay argues that the United States and Taiwan should begin to negotiate a bilateral FTA. Although U.S.-Taiwan economic relations have been mostly amicable, the relationship has been characterized by a number of persistent disagreements. An FTA would offer the opportunity to resolve these disagreements and would help prevent the marginalization of Taiwan—widely viewed in Washington as an important strategic partner—in a region increasingly characterized by bilateral and multilateral FTAs that Taiwan has been unable to join. [End Page 4] U.S.-Taiwan Commercial Relations Despite the island's relatively small population of around 24 million people, Taiwan was the United States' eleventh-largest merchandise trading partner in 2018. Total bilateral trade in goods stood at $76 billion in 2018, with the United States running a bilateral deficit of $16 billion. Although substantial, these numbers represent only 1.8% of total U.S. trade and indeed suggest that Taiwan has become a less important trading partner than it was in the past. During the late 1980s, for instance, Taiwan was the sixth-largest trading partner of the United States, and it stood as the eighth-largest trading partner into the 2000s.4 It is worth emphasizing, however, that official trade statistics understate the actual scale of the current U.S.-Taiwan commercial relationship by a considerable amount. Taiwanese manufacturers, since the 1990s, have moved a substantial portion of their production facilities to China, in large part to take advantage of lower labor costs there. Important component parts often originate in Taiwan or elsewhere and are imported into China for assembly. The final products are then exported abroad. Taiwan firms reported export orders from the United States of $146 billion in 2018, which was nearly triple the value of U.S. imports from Taiwan in that year. Many of these goods were assembled in and exported from China, meaning they are counted as Chinese exports to the United States (even when they are manufactured by Taiwanese companies and include, in some cases, substantial inputs originating from Taiwan).5 The current U.S.-China trade war has potentially large implications for commercial ties between the United States and Taiwan. The American Chamber of Commerce in Taiwan notes that the trade war is already causing some Taiwanese manufacturers to consider relocating production back to Taiwan.6 If the conflict continues to escalate, the number of firms considering moving facilities back to the island is likely to grow. Even if [End Page 5] a settlement is reached, the Trump administration's erratic approach to U.S.-China trade, coupled with a more generally adversarial relationship that will likely remain uneasy regardless of who wins the U.S. presidential election in 2020, generates considerable uncertainty for Taiwanese companies with significant operations in China. This uncertainty, in turn, will likely push more firms that depend heavily on U.S. exports to move operations out of China—either back to Taiwan or elsewhere. Managing Disagreements Given that the U.S.-Taiwan economic relationship is quite extensive, it is not surprisingly sometimes characterized by points...

South African dominance of trade in Africa as well as its position as a regional hegemon was entrenched by the Trade, Development and Cooperation Agreement (TDCA) with the European Union in 1999. South Africa's full-blown integration into the BRICS (Brazil, Russia, India, China, South Africa) formation since 2011 has brought new dynamics, however, as South Africa now has a marked BRICS orientation. Although the European Union (EU) as a bloc is still South Africa's largest trading partner, China has become South Africa's largest single-country trading partner. The question arises as to whether this new found loyalty makes sense in terms of South Africa's regional position and its trade prospects. Against the background of more intra-industry trade with the EU and the new and growing inter-industry trade with the other BRICS economies, South Africa's trade share of African trade has been in relative decline. This study uses an international political economy framework to analyse South African trade hegemony based on the TDCA and the possible effects of a shift towards BRICS. The conclusion is that, although the shift towards BRICS can politically be justified, economically it should not be at the expense of the benefits of the more advantageous relationship with the EU.

Since 1988 Russia and Korea have been developing bilateral economic relations. After the conclusion of, the first trade agreement, Korea has become one of the largest trading and investment partners of the Russian Far East. Annually, Korea has increased trade and investment flows to the Russian Far East, a region with high growth potential. By the 2000s Korea has become the Russian Far East’s third largest trading partner. This article considers trade and investment flows from the 1990s to the present, analyses the prospects of achieving goals, and the problems of developing further bilateral cooperation between Russia and Korea.

Emerging market economies are an important trade and investment partner for the European Union (EU). We measure the EU comparative advantage in manufactured goods and high-technology products using first the actual exchange and growth rates, and then an approximate equilibrium exchange rate and potential growth rate. It turns out that the EU has a comparative advantage vis-à-vis all its trading partners except for the Asian economies. Subsequently, the paper examines EU investments in emerging markets which account for 33 per cent of all EU outward FDI. Finally, we show that the EU has a number of trade agreements with emerging market economies in effect or under negation.

This paper analyses the characteristics of the foreign trade of Cuba with its most important trade partners, from the so-called Special Period which was the result of the collapse of the Soviet Union in 1991. The absence of the Soviet bloc presented Cuba the necessity of structural changes in its economy and foreign trade. Trade between Cuba and its trade partners is a center-periphery type, where during the last time China outstands, as exporting center of manufactured goods and Cuba as supplier of raw materials. The economic embargo of United States to Cuba has limited the foreign trade, but lately United States has become a good supplier of Cuba, whereas Cuba has exported mostly art pieces and antiquities. Russia, once upon the most important trade partner, has now the same condition as China, as exporter to Cuba of manufactured goods and machinery, and Cuba as supplier of raw materials.

This paper analyzes the implication of economic structural change and dietary transformation on changing patterns of agri-food trade among 17 Asian development countries. Sub-regional trade in Central, South, and Southeast Asia is the focus of the paper, along with trade with other partners outside the sub-regions. The paper finds that Asian markets for total agri-food exports and exports of nutritious foods are generally more important than the markets outside of Asia and for many of them, the importance of Asian markets increases over time. While net exporters and importers co-exist in each sub-region, with a few exceptions, sub-regional trade is often less important. Many small countries trade only with one or two large neighbors and less so with each other. The dietary transformation impacts trade in nutritious foods in diverse ways. With income growth, increased domestic demand for nutritious foods seem to lead to more imports of these foods. While many South and Southeast Asian countries have a comparative advantage in exports of some nutritious food products, growth in these exports can be negatively affected by rising domestic demand. Although nutritious food exports continue to play important roles in total agri-food exports, export growth of nutritious food is often slower than overall growth of agri-food exports. The dietary transformation also seems to lead to increases in demand for processed foods which many Asian countries meet through imports, often, accounting for a large component of total agri-food imports. On the other hand, processed foods generally account for a small portion of agri-food exports. However, there are a few countries where processed food export growth is rapid. In these cases, the sub-regional market is expanding, but with few exceptions, it is still less important than trade with countries outside the sub-regions. The paper also finds that agri-food exports and imports are highly concentrated, and a small group of commodities dominate most countries export and import portfolios and remain unchanged over time. The main markets for these important commodities are generally not in the sub-regions and this mismatch between demand and supply of agri-food commodities within sub-region is a natural barrier for promoting regional trade. The modified trade complementary index developed in this paper is based on Michaely (1996) and shows that trade complementarity measures are positively correlated with actual bilateral trade. Small countries tend to enjoy higher levels of complementarity with one or two large trading partners than with other small countries in the same sub-region. This implies that small countries could be better off from bilateral trade arrangements with large partners compared to a regional trade agreement within the sub-region. Because the sub-regional market is oftentimes not large enough to meet large countries’ import demand or consume their export supply, regional trade agreements within sub-regions may be less likely to serve their needs for trade expansion than negotiating with large trading partners outside the sub-regions. While many Asian developing countries’ governments have been pushing for trade diversification and want to reduce export dependencies concentrated on one or two large trading partners, this paper shows the challenges to achieve this policy goal. For small countries, focusing on bilateral trade arrangements with their dominant trading partners seems to be a more practical and effective strategy than regional trade agreements within sub-regions. Long-term trade arrangements, consistent trade policies, and various preferential trade arrangements should be pursued by small countries with their larger trading partners to promote agri-food exports.

The textiles sector accounts for a significant share of global energy consumption and water pollution, with the fashion industry alone being responsible for around 4 per cent of carbon emissions. Moreover, the linear fast-fashion model exacerbates air pollution and drives biodiversity loss and land-use change through intensive resource extraction and production. Embracing sustainability and circularity in textiles offers a pathway towards reducing these adverse effects, promoting resource efficiency, minimizing waste generation, and safeguarding environmental and human well-being for future generations. In response to these challenges and in support of the wider European Green Deal and circular economy action plan, the EU launched its Strategy for Sustainable and Circular Textiles in 2022. The strategy aims to transform the EU’s textiles sector via a broad suite of policy measures. The ability of non-EU value chain actors to adapt to these requirements is fundamental to the success of the strategy given that the EU imports 80 per cent of its textiles, with half of such imports coming from low- and middle-income countries. Yet the introduction of onerous policy measures will increasingly disrupt and reconfigure global textile value chains, resulting in complicated and context-specific challenges not only for textile and garment suppliers to the EU but also for trading partners that are recipients of postconsumer textiles. The challenges will be particularly pronounced for value chain actors within key developing-country trade partners. Given the EU’s dependence on these suppliers and markets, there is a risk that the overarching goals of the EU Strategy for Sustainable and Circular Textiles will not be achieved if trading partners cannot easily overcome or mitigate the compliance challenges involved. As such, there is a greater need to clarify the potential consequences for key producer and recipient trading partners, and for the EU to strengthen attempts to mitigate these consequences in the design of future EU circular textile policy measures. Ghana is an important textile trading partner to the EU, receiving $28.8 million worth of used textiles in 2022. This technical study looks at the potential opportunities and challenges that the EU strategy presents for Ghana’s textile industry – notably in terms of changes to key trade patterns (imports of used and unsold textiles from the EU, and exports of new or renewed textiles to the EU). Recommendations for the EU textiles policy community are subsequently provided regarding the design of future policy to help mitigate the challenges and amplify the opportunities for trading partners within a circular textiles value chain (particularly for developing or least developed countries).

Foreign exchange rates from the currencies of trading partners are a critical element in the development of Indonesia's economic landscape. As an active country in international trade, Indonesia's economic health is highly dependent on trade partnerships, movements, and interactions of foreign exchange rates from Indonesia's main trading partners. To achieve economic stability, Bank Indonesia intervenes in the foreign exchange market to keep the Rupiah exchange rate within a reasonable range. Indonesia is committed to achieving several points in the Sustainable Development Goals (SDGs), such as point 17, which emphasizes partnerships, and point 8, which underlines inclusive and sustainable economic growth. This commitment is an important factor in Indonesia's economic development. Therefore, it is necessary to predict the exchange rate value of Indonesia's largest trading partners considering these SDG aspects. In this study, the Vector Error Correction Model (VECM) was used to predict the foreign exchange rate of Indonesia's largest trading partners. The data used in this study is secondary data obtained from the investing.com webpage, comprising weekly data from January 2021 to November 2023. The foreign exchange rates of Indonesia's largest trading partners have a cointegration relationship, indicating long-term relationships and similarities in movements. The best model identified is VECM (1), with a very accurate MAPE value of 3.29%. The Impulse Response Function (IRF) analysis shows that the Chinese Yuan responds variably to different currencies, stabilizing over time. Variance Decomposition reveals that short-term fluctuations in the Chinese Yuan are primarily influenced by itself (87.89%) and significantly by the Singapore Dollar, South Korean Won, and Taiwan Dollar. The Granger Causality Test indicates that the Philippine Peso influences 11 other exchange rates, refining the VECM model and improving prediction accuracy. Indonesia is expected to build economic collaborations that can help achieve economic stability.

India and Singapore are mutually important economic partners. Singapore is not just India's most important trading partner amongst the ASEAN countries, but also significant as India's gateway to ASEAN and china. The paper studies the trends and changes in the composition of exports and imports of Indian trade with Singapore during the study period 1991-2009. It uses regression analysis for the same. India is Singapore's fastest growing trade partner amongst major economies, outstripping even china. Not only has bilateral trade soared between the two nations since the signing of the comprehensive economic cooperation agreement in 2005. India was Singapore's 13th largest trading partner in 2005. This paper is useful for the researchers and businessmen who wish to do trade between India and Singapore. This paper defines a paradigm shift in the trade relations between India and Singapore.