Trade Balance Research Articles

Relative responses of trade in goods and services to currency devaluation: Evidence from Ethiopia

Lack of hard currency is one of the key growth barriers in emerging countries, as imports vastly outstrip exports. In response, governments in these countries usually undertake a variety of policy packages, including the devaluation of the domestic currency. Despite these efforts, there have been no discernible adjustments to foreign balance. This study examines whether the response to devaluation differs significantly between the goods and services trade in Ethiopia. We estimate the long- and short-run elasticities of the disaggregated trade indicators using an autoregressive distributed lag (ARDL) and error correction mechanisms. The empirical results confirm a significant difference between the goods and service sectors in terms of their responses to the devaluation policy in the long and short run. The estimated long-run elasticities of devaluation are only statistically significant for service imports and trade balances with negative signs. The remaining sectors did not show any significant relationships. In addition, we obtain meaningful short-run elasticities for service imports, goods exports, and total exports, all of which have a negative sign. Domestic inflation accounted for a large portion of the short-run import dynamics, output growth, and FDI, which contributed significantly to long-term export performance. The current study reveals that the government should not rely exclusively on the devaluation policy to bridge its external imbalances, and should see alternative and more effective policy mixes to alter the demand and supply sides of foreign trade.

Analysis of the competitiveness and complementarity of China-Vietnam bilateral agricultural commodity trade.

Vietnam's agricultural exports to China have remained strong, with the country maintaining its position as the top destination for Agri-products. This article primarily utilizes the Revealed Comparative Advantage (RCA) Index, and Trade Complementarity (TC) index to examine the trade comparative advantage, and the complementary of twenty major agricultural products between China and Vietnam from 2012 to 2021. The study results showed that Vietnam and China frequently exchange agricultural products. Vietnam has more stronger competitiveness than China in terms of agricultural products. China's exports to Vietnam were highly complementary to Vietnam's imports in category 0 whiles Vietnam's exports to China showed strong complementarity with China's imports in category 2. This paper analyzes the complementarity and comparative advantages of agricultural trade between China and Vietnam, and proposes informed suggestions for policy-making to promote agricultural trade between the countries. The proposed suggestions aim to expand agricultural trade between the two countries, reduce the trade imbalance, and achieve mutual benefit and win-win results.

Understanding dollar dynamics and SME performance in GCC economies

PurposeThis study investigates the impact of US dollar volatility and oil rents on the performance of small and medium-sized enterprises (SMEs) in the Gulf Cooperation Council (GCC) region, with an emphasis on understanding how these factors influence SME financing constraints in economies with fixed currency regimes.Design/methodology/approachEmploying a random effects panel regression analysis, this research considers US dollar volatility and oil rents as independent variables, with SME performance, measured through the financing gap, as the dependent variable. Controls such as trade balance, inflation deltas and gross domestic product (GDP) growth are included to isolate their effects on SME financing constraints.FindingsThe study reveals a significant positive relationship between dollar volatility and the financing gap, suggesting that increased volatility can exacerbate SME financing constraints. Conversely, oil rents did not show a significant direct influence on SME performance. The trade balance and inflation deltas were found to have significant effects, highlighting the multifaceted nature of economic variables affecting SMEs.Research limitations/implicationsThe study acknowledges potential biases due to omitted variables and the limitations inherent in the use of secondary data.Practical implicationsFindings offer pertinent guidance for SMEs and policymakers in the GCC region seeking to develop strategies that mitigate the impact of currency volatility and support SME financing.Originality/valueThe research provides new insights into the dynamics of SME performance within fixed currency regimes, which significantly contributes to the limited literature in this area. The paper further underscores the complex connections between global economic factors and SME financial health.

Information and Communication Technologies (ICT) and Economic Growth in Latin America: An Empirical Analysis for the 2000-2020 Period

Introduction ICTs (Information and Communication Technologies) play a crucial role in improving efficiency and productivity in various economic sectors. The research focuses on measuring the impact of ICTs on the economic growth of Latin American nations during the period 2000-2020. Methods A fixed effects, panel data model covering 17 countries in the region has been applied using ordinary least squares methodology. The variables selected for the empirical exercise are: the number of individuals using the Internet, fixed and mobile telephone subscriptions, trade balance, domestic credit, foreign direct investment and gross domestic product per capita. Results The study’s findings show that ICTs have a positive impact on economic growth. That is, for every percentage point increase in the percentage of the population using the Internet, GDP per capita increases by US$16.82. Conclusion This highlights the unique influence exerted by digital connectivity in shaping the regional economic landscape. At the same time, mobile and fixed telephone subscriptions are not significant variables in the model.

Capitalist, Evolution, Financial Innovations and Financial Literacy: A Study of their Dynamics in Shaping Modern Capitalism

Finance has had its root in human history since human being started a settled civilized life. As production for trade took a shape, various means of transactions and storage of value kept on evolving. Gradually, finance took the center stage with the evolution of modern capitalism. In early stages the financial instruments remained a scattered individual means of financial practice, no central regulation existed in the early era. Hence the acquaintance with these instruments was also confined to individual users, the traders, particularly. Since economic productivity was quite low, ordinary individuals had little surplus to save, not many had much to do with financial literacy. The modern capitalism required industrial workers, surplus of agricultural products, more consumers for market, more means of production to produce trade surplus and more financial savings and instruments to channelize investments. Also the producers were required to be alienated from the product of labour so that the trade of commodities could be taken in control by the trading class. Also the means of production, which was otherwise the ownership of the households, was to be turned marketable to facilitate the transfer the ownership from ordinary owners to the trading class. The trinity of commodity production, wage labour and market system altogether had to evolve for capitalism to come into existence. Accordingly, various financial instruments took shape, the traditional ones became more formalized and many new ones were invented. The evolution of different forms of business, the 'company' form particularly, helped this process in a big way. Simultaneously, the financial anarchy put the systems in turmoil and hence regulatory bodies became a compulsion. These regulatory bodies assumed the twin role of regulation of financial markets, financial facilitation, as well as creating financial literacy among ordinary people to link their savings to the mainstream trade and commerce lines. The paper attempts to portray the evolution of modern financial system and find out how this evolution has been linked to the financial literacy of the common masses. Also the paper would throw lights on imminent market and systemic hazards caused by excess leliance on financialisation of economic system.

Where Risk Policies Going – A Case of Sacombank Vietnam in 2 Periods

In emerging markets such as Vietnam with stock market development, enhancing risk management for big corporation such as banks is vital to survive. We developed our studies from analysis of bank stock price to bank beta CAPM and now is bank cost of equity. Therefore, we select a big bank in Vietnam (STB Sacombank) and one of this study’s purposes is to make Assessment of relation between cost of equity, beta capm and market risk premium in a case of sacombank Vietnam in 2 periods. Our research results tell that: As R, G and VNIdex have positive impact on COE in both periods (see table 11) whereas IM has negative impact on COE (cost of equity) we would suggest that reducing R and G slightly to reduce cost of equity and increasing IM. Finally, because exchange rate has negative impact on COE in both periods while trade balance has positive impact on COE in both stages, we would recommend that increasing exchange rate and reducing trade balance to reduce COE. Therefore, our study can be expanded for other markets.

Analysis of the Korea's Trade Deficit with China in 2023

Analysis of the Korea's Trade Deficit with China in 2023

Sources of suspended sediments in salt marsh creeks: Field measurements in China and the Netherlands

Marsh creeks are perceived as important conduits for transporting water and sediment between mudflats and marshes. In order to advance the understanding of the transport mechanisms in creeks, the source and ultimate sink of sediment which moves between mudflats and marshes through creek channels need further investigation. Therefore, two field campaigns were conducted in two intertidal systems with varying sediment availability. The water depth, flow velocity, suspended sediment concentration, and bed level change were measured simultaneously in a marsh creek and on the adjacent mudflat in Chongming Island (China) and in Paulina Saltmarsh (the Netherlands). Paulina Saltmarsh is much smaller, more frequently flooded, and has lower sediment concentration than Chongming. These contrasting conditions allow for a comparison of transport mechanisms and functioning of the creek. Both systems first show that the high suspended sediment concentration (SSC) measured in marsh creeks is mainly the consequence of sediment advection rather than local erosion. In addition, erosion in marsh creeks is usually limited during ebb tides, reducing the export of sediment through these creeks. However, differences have been observed between two systems. The measured SSC was highly asymmetric between flood and ebb tides in Chongming. Large peaks in SSC during the flood period can be observed for most tidal cycles. The marsh creeks in Chongming therefore function as conduits for sediment import. Additionally, there are distinct overbank and underbank tides in Chongming. Sediment was trapped and retained in creeks during underbank tides, which can then be eroded and transported to the marsh during subsequent overbank tides. We also observed that mudflats in Chongming quickly recovered after erosion. These mechanisms have not been observed in Paulina Saltmarsh, where net sediment export via the marsh creek was observed due to a lack of abundant sediment in suspension during flood tides. Furthermore, the remaining bed surface of mudflats after an erosion event was stronger than before, limiting further erosion in Paulina Saltmarsh. These findings from the two systems indicate that the role of creeks in sediment import/export depends on the availability of sediment from mudflats, shedding light on nourishment strategies for salt marshes.

Analisis pengaruh perang dagang AS-China bagi kondisi ekonomi ASEAN-4 periode 2017-2020

International trade is the exchange of goods and services between citizens of two or more countries by mutual agreement. However, the increasingly intensive trade can trigger conflicts during trade, which are called trade wars. The current trade war between the United States and China is playing with each other's trade tariffs. This research analyzed the influence of the US-China Trade Balance, ASEAN balance of payments, and imports related to ASEAN-4 economic conditions. This observation selects secondary data from the World Bank, International Monetary Fund (IMF), and CEIC Data. The data used in this research is panel data on 4 ASEAN countries, including Indonesia, Malaysia, Vietnam, and Thailand, in 2017-2020. Meanwhile, the analysis technique uses the Common Effect Model (CEM) approach. The final calculation results show that the US-China trade balance and import variables influenced ASEAN-4 economic conditions in 2017-2020.

The impact of the effective exchange rate volatility on the trade balance of Vietnam

The impact of the effective exchange rate volatility on the trade balance of Vietnam

On the effects of crude oil demand and supply shocks on Korea’s bilateral trade balance: are the effects asymmetry?

ABSTRACT The contribution of the present article is to find any indication of whether three components of oil shocks – oil supply shocks, aggregate demand shocks, and oil-specific demand shocks – asymmetrically influence the bilateral trade balance of Korea with its top 10 partners. We discover that there is evidence that the three oil shocks asymmetrically influence Korea’s trade balance with some of its top 10 partners in the short- and long run. Additionally, the asymmetric impact appears to be a country-specific phenomenon and varies depending on different shock components.

Exchange rate volatility and its effects on Uganda’s trade balance (1980–2020)

Exchange rate volatility and its effects on Uganda’s trade balance (1980–2020)

ANALISIS EKSPOR, IMPOR TERHADAP NERACA PERDAGANGAN DI EMPAT NEGARA EMERGING MARKET (RITI)

The goal of international trade between nations is to promote economic expansion. Based on the trade balance's findings, indicators of a nation's performance in international trade can be examined. The rate of economic growth, which can be evaluated from a number of angles, including the value of imports and exports, which affect a nation's trade balance, can be used to characterize a country's degree of success. The purpose of this study is to ascertain the short- and long-term effects of GDP, exports, imports, exchange rates, and GDP on the trade balance in four emerging market nations. The ARDL Panel Method was used to collect data from the World Bank between 2012 and 2022 for this study. There are therefore both long-term and short-term relationships. Over an extended period, the trade balance is largely influenced by exports, GDP, and exchange rates. Exports, meanwhile, have an immediate impact on the trade balance.

Competitiveness of Mexican vanilla (Vanilla spp.) in the international market

Objective: To analyze the competitiveness of Mexican vanilla in the international market. Design/Methodology/Approach: The relative trade balance (RTB) and the revealed comparative advantage index (RCAI) were calculated to analyze the competitiveness of the Mexican vanilla in the international market. Both crushed and whole vanilla beans were evaluated. Results: Around 1% of the total vanilla area is harvested in Mexico, representing 6% of the world production volume. The Mexican market is competitive in the international whole vanilla beans market, but not in the case of crushed or ground vanilla. Study Limitations/Implications: The SIAVI portal was discontinued. Therefore, the international vanilla trade data could only be retrieved for the period ending on November 2021. Findings/Conclusions: The Mexican market has potential for the development of vanilla production. However, current production is practically absorbed by the local market.

Measuring and forecasting the growth of dates exports in Iraq using the box-Jenkins methodology during the period 1990-2025

Exporting to any country is an important factor in generating income and providing foreign exchange by increasing those exports. The purpose of the study is to determine the feasibility of production and export of dates to Iraq and to use the Box- Jenkins methodology to predict date exports to Iraq for the years 1990–2025 based on time series. They were represented by the number of dates exported to Iraq in the years 1990-2019. Statistical means and methods were used to study the nature of the time series, where it was noted that there is a clear fluctuation in the quantity of exports. The researchers concluded, through the use of the Box- Jenkins methodology, that the appropriate model for predicting the amount of date exports is the ARIMA model (2,2,1) among a group of models that does not have the best values through the criteria adopted for selection. As well as the model (1,0,0) to predict the production quantities of dates. The study concluded to continue to support the agricultural sector, especially production Dates, because Iraq is characterized by different types, as well as the increase in exports, which is an important part in achieving agricultural economic development, as well as the adoption of economic policies that help encourage exports by supporting producers, which achieves returns on the trade balance and foreign currency

Impacts of the US-China Trade Tension and RCEP on Vietnam-China Trade Balance

The paper aims to analyze the trade balance between Vietnam and China and assess the impact of its key determinants, with a focus on the US-China trade war, using the autoregressive distributed lag model for quarterly data from Q1 2009 to Q4 2022. The statistical analysis shows that although Vietnam's trade balance with China shows increasing deficits, the US-China trade war has a positive impact on Vietnam as its export-import ratio with China increases in both the long and short run. We also find that the impact of participation in the Regional Comprehensive Economic Partnership (RCEP) is positive but not statistically significant. We also find evidence that several factors have a positive and significant impact on the trade balance, including Vietnam's growth rate, Vietnam's industrial production index, and China's population. On the other hand, some factors, such as the exchange rate between Chinese yuan and Vietnamese dong and the population of Vietnam, are found to have a significant negative impact. These findings can provide evidence to help Vietnamese businesses and policymakers formulate trade policies with China, especially in the current complex geopolitical context.

Contemporary Statistical Trends of Export of Goods From Georgia to Latvia

Despite the improvement of the indicators of Georgia's export relations with the European Union, the balance of foreign trade with many countries, including Latvia, is negative. It amounts to −29 357.00 thousand US dollars, and compared to the previous year, it has increased by 27 %. The aim of the paper was to analyze the main trends of exports from Georgia to Latvia. Statistical research methods were used in the research process. In general, export relations with Latvia are characterized by an increasing trend. During the study period, during the last ten years, exports grew by an average of 8.8 % annually and were characterized by a rather diverse commodity structure. The range of growth rates varied between 77.6 % and 135 %, and its magnitude varied at different stages. In 2022, Georgia’s exports to Latvia increased by 31.2 % compared to the previous year and by 35 % compared to 2019. During the research period, there were no significant changes in the product structure, and the main export products were wine of fresh grapes, petroleum and petroleum oils, undenatured ethyl alcohol, spirits, liqueurs and other spirituous beverages, waters, natural or artificial mineral and aerated waters, etc. The volume of local exports to Latvia is increasing. In 2014–2022, it grew by an average of 3.7 % annually, although the share of local exports in total exports to Latvia fell from 92 % in 2014 to 67.7 % by 2022. Instead, the volume of re-exports increases. In the same period, the re-export volume increased by 28.3 % annually. The commodity structure also changed slightly.

Determinants of GDP Growth and Debt-to-GDP: A Comparative Study of Finland and Greece after Joining the European Monetary Union

This paper analyzes Finland and Greece’s GDP growth and debt-to-GDP ratio post-European Monetary Union (EMU) accession. Using a robust ARDL with cointegration bounds model (2002–2021), and Johansen approach for cointegration, we find a positive impact of favorable trade balance on GDP growth and a negative impact on debt-to-GDP ratio in both nations long-term. Finland’s GDP growth is negatively affected by the country to EU average inflation ratio, while Greece sees increased debt-to-GDP due to it. Greece’s elevated government spending hampers its economic growth short- and long-term, and Finland’s debt rises in the long run with higher country to EU average unemployment.

The China-US Economic Relationship in the Early 21st Century

China and the United States are two major economic powers that are currently engaged in trade and are using different strategies to enhance their bilateral relations. The main objective of this research is to analyze the policies and activities that these nations are using to promote and advance their trade relations, which will likely result in financial and political benefits in the long run. This investigation is primarily based on secondary sources such as scientific and scholarly journals, research papers, books, and articles related to the topic at hand. The study comprehensively explores a variety of factors impacting trade relations between China and the United States. This includes examining bilateral treaties, one-phase agreements, the Belt and Road Initiative, the Australia, UK, and US Security Pact, policies aimed at achieving competitive advantage, as well as cooperation in addressing regional and global issues to promote trade relations between the two countries. The trade conflict between the two countries is very serious. According to the study, China and the US pursue many comprehensive and conventional barriers, such as a lack of registered goods in each nation, a rise in trade imbalance, tax disparities, a lack of business ties, the Quad, the conflict in the South China Sea, bilaterally sensitive issues, the Taiwan dispute, and environmental conditions and policies. If both countries could solve these problems then relations between the two countries would be improved in the 21st century.

The dynamic connectedness between renewable energy market and environmental protection industry based on time and frequency perspective

Renewable energy promotes the sustainable development of the environmental protection industry (EPI) and the economy. Meanwhile, the EPI provides various technologies and services for renewable energy, which is an important guarantee for the renewable energy market. This paper combines the DY and BK spillover indexes to discuss the cross-market risk contagion effect between EPI and renewable energy market from the perspective of time-frequency spillover. The results show that: (1) The spillover effect between the EPI and renewable energy market is cyclical from the perspective of frequency domain, and the total market spillover is dominated by high-frequency spillover. And the risk contagion has the characteristics of time-varying and vulnerability from the perspective of time domain. (2) The net spillover effect shows that the EPI plays the role of a net exporter in different frequency domains, the solar energy and the hydro market play more roles as risk receivers, and the role of the wind energy market is frequently converted. (3) The risk spillover network structure shows that EPI acts as an important node in the cross-market risk contagion path. Driven by EPI, the short-term risk transmission follows the path of “EPI-biomass energy-other four renewable energy markets”, and the medium and long-term follows the path of “EPI-wind energy-other four renewable energy markets”.