Abstract
The value of natural rubber exports is declining continuously every year. One of the reasons for the decline in the value of natural rubber exports is due to the implementation of Non-Tariff Measures (NTMs) by the main export destination countries in international trade. The most widely applied NTMs policies in trading countries are Sanitary and Phytosanitary (SPS) and Technical Barrier to Trade (TBT). This study aims to analyze the impact of NTMs on Indonesia's natural rubber exports from 2012 to 2016. The estimation result shows the GDP coverage ratio of SPS and coverage ratio of TBT significantly affect the export value of the natural rubber of Indonesia. SPS variable shows a negative coefficient value while the TBT variable shows a positive coefficient value. Keywords: Natural Rubber, Gravity Model, Inventory Approach, NTMsJEL Classification: F13, F14, Q17
Highlights
Exports are a driving force for accelerating economic growth
Based on the results of the t-test showed that the Non-Tariff Measures (NTMs) policy in the form of Sanitary and Phytosanitary (SPS) which was applied to natural rubber type TSNR had a negative effect of 0.0034
The performance of Indonesia's natural rubber trade based on the trade balance from to 2016 shows good conditions, this is evidenced by the national trade balance that is positive every year in all major export destination countries
Summary
Exports are a driving force for accelerating economic growth. Rubber is one of the export commodities of the plantation sub-sector besides oil palm, coffee, and cocoa. In addition to playing a role in contributing foreign exchange and employment opportunities, rubber is a provider of industrial raw materials and O2 producers. From its sizable contribution to GDP, the Indonesian government classifies rubber as the leading export commodity which is the backbone of the national economy. Rubber commodity ranks second in the production and export value of Indonesian plantation commodities after oil palm. Indonesia's total rubber production reached 3.77 million tons in 2018 or 26 percent of total world production (Indonesia EximBank, 2019), with a market share reaching 65.9 percent in 2017
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