Trade Balance Research Articles

Analysis of Rice Trade and Food Security in Southeast Asian Countries

The rice trade serves to maintain sufficient rice stocks to meet domestic country demands. The world’s main rice exporters and importers are located in the Southeast Asia region, so the volume change of traded rice can affect the flow of trade. Given the strategic importance of rice, numerous nations have stepped in to control the domestic rice market, to ensure political stability as well as food security. This article aims to examine how the rice trade has evolved in Southeast Asia with respect to food security. The study aims are addressed by the application of the descriptive analysis method. The findings indicate that from 110.5 million tones in 2010–2011 to 128.3 million tones in 2021–2022, Southeast Asian countries accounted for 1.22% of global rice imports, >22% of the world’s total rice consumption. In the meantime, the annual growth rate of rice exports was 3.3%. Over the past 10 years, ASEAN’s net rice exports have made up 53.3% of the world’s total and are expected to reach about 54.8%. Southeast Asian countries intervene in the rice market through international trade policies, both in the form of export bans and domestic rice price stabilization policies, to maintain rice stocks to strengthen the level of food security. Southeast Asia’s economic integration through the ASEAN Economy Community is an important moment to become the basis for achieving food security at the regional levels while at the same time making the rice market more open among Southeast Asian countries. Keywords: rice, trade, policy, Southeast Asia

THE EFFECTS OF PRICE AND VOLATILITY INDICES OF STRATEGIC COMMODITIES ON STOCK MARKETS: A STUDY ON BRICS ECONOMIES

The effect of gold, oil prices, which are strategic commodities, and gold, oil volatility indices on the BRICS stock exchanges is investigated in this paper. The relationship between the variables is analysed for the short and long-run using the NARDL method. Gold prices have a negative effect on stock markets except Brazil and Russia, in the short and long-run. Changes in oil prices have a negative effect on stock prices in South Africa, which imported oil, and a positive effect in net oil exporters Brazil and Russia, in the short and long-run. It is concluded that positive and negative shocks of strategic commodity volatilities have an asymmetric effect on the stock exchanges of emerging countries in the short and long-run.

The Role of Central Asian and South Caucasian Economies in Foreign Trade of the Republic of Türkiye

Based on the data of the World Integrated Trade Solution of the World Bank, this paper discusses the role of the Central Asian and South Caucasian economies in the foreign trade of the Republic of Türkiye. In order to obtain comparable results, Türkiye's exports to the Central Asian and South Caucasian regions and imports from the former to the latter are considered in constant prices. The observation shows that both trade flows increased during the period under consideration. For most of the years, many of the countries remained net importers of Turkish goods, as their exports to Türkiye exceeded the value of the goods they purchased from Türkiye. Only three of the eight countries - Kazakhstan, Tajikistan, and Uzbekistan - were net exporters to Türkiye for most of the period. The analysis shows that the largest buyers of Turkish exports in the regions were Azerbaijan, Georgia, and Uzbekistan, which together consumed more than 2.5% of total Turkish exports in 2019. In total, Central Asia and South Caucasus bought more than 3% of Turkish exports, which is quite comparable to the shares of Türkiye's trading partners such as the Netherlands, France, Spain, the US, and Italy. The share of Central Asia and South Caucasus in Türkiye's imports was much less significant.

Determinan Nilai Ekspor Jasa Transportasi di Negara-Negara ASEAN

Transportation services are the most significant contributor to the deficit in the Association of Southeast Asian Nations (ASEAN) services trade. From 2016 to 2019, eight out of ten countries in the ASEAN still experienced a trade deficit in transportation services. So that this condition does not drag on in a continuous deficit, one of the policies that each country can carry out is to increase the export performance of transportation services. This study aims to determine the factors that affect the export of transportation services in ASEAN. The secondary data used is trade flow data from 2012 to 2019 from the ASEAN Secretariat and World Bank. The method used is panel data regression with the Random Effect Model (REM). The result found that foreign direct investment, exports of goods, and value-added services significantly affect exports of transportation services in ASEAN. Meanwhile, internet users and exchange rates do not substantially affect exports of transportation services in ASEAN. The results of this study recommend continuing to improve the climate for ease of investment. In addition, it is essential to utilize resources that can increase the production of transportation services and maintain the availability of raw materials and capital goods.

External Financial Flows, Fiscal Policy and Human Development Index in Nigeria

The sustainable development goals that were rolled out and adjusted from the un-attainment of Millennium development goals of 2015, lacks a notable financial option and channel that would help developing countries like Nigeria to achieve goal 3, goal 4 and goal 8, which this study captured with the human development index. This study examines the effect of external financial flows, fiscal policy and human development index in Nigeria. The used the secondary data that was collected from World development indicators and Central bank of Statistical Bulletin. The period was between 1991 to 2022 bot year inclusive. The external financial flows was captured with foreign direct investment, foreign aid, remittances, net exports, external debt while fiscal policy was captured with government expenditure for education and government expenditure for health. The findings from the external financial flows revealed that foreign direct investment and remittances have a negative significant effect on human development index while net export have a positive significant human development index. The fiscal policy measures revealed that government expenditure on education have a positive significant effect on human development index while government expenditure on health have a negative significant effect on health. The Nigerian government should focus on policies that boost export sectors, especially those that add significant value to raw materials. This can be achieved through subsidies, tax incentives, and investment in infrastructure. The Nigerian government should allocate a larger portion of the national budget to education. This increase in funding should aim to address infrastructural deficits, enhance teacher training, and provide adequate learning materials. Implement robust mechanisms to ensure that health funds are used efficiently and transparently.

Empirical analysis of the J-Curve and Marshall-Lerner condition: impacts of macroeconomic shocks on the Brazilian trade balance using a Bayesian SVAR Identified via heteroskedasticity

ABSTRACT This study examines the impacts of macroeconomic shocks on the Brazilian trade balance, disaggregated into five sectors, using a Bayesian SVAR model identified via heteroskedasticity. We find significant evidence supporting the Marshall-Lerner condition across all sectors analysed. Although we have not observed significant evidence supporting the J-curve, there is a higher probability of the phenomenon occurring than not occurring. Additionally, our findings indicate that a world GDP shock influences the domestic trade balance with the expected sign. A ‘pessimism’ shock regarding domestic economic activity leads to an improvement in the trade balance. Moreover, it is observed that an increase in GDP, even when caused by a supply shock, leads to a deterioration of the trade balance in the medium term.

The Relationship Between Cryptocurrencies and the Trade Balance of Nigeria

Bitcoin has increased rapidly in value since the first day of its integration into today's markets. The increases experienced have directed the interest of global investors to this field over time. In addition to these developments, the increasing popularity of blockchain technology and the increase in the volume of cryptocurrencies have turned these currencies into an important tool for commercial activities. Although there are many studies to measure the international trade balance with exchange rates, no study has been found to examine the relationship between the change in cryptocurrency prices and the trade balance of countries. In this study, the relationship between the trade balance of Nigeria, one of the leading countries in the world in terms of cryptocurrency usage, and cryptocurrencies is analysed using NARDL analysis with coefficient symmetry test (2016/M4-2020/ M12). According to the research results, Bitcoin and Litecoin can have significant long-term impact on Nigeria's trade balance.

A footloose capital model of economic development

AbstractWe present a footloose capital model in a two‐country economy and the manufacturing and natural resource sectors with heterogeneous manufacturing firms to analyze the impacts of trade liberalization and technological progress on the net capital flows, net export, and social welfare. Our main analytical result is that a lagged country initially experiences capital outflow due to the high technological gap in the manufacturing sector with increasing returns to scale, then capital inflow due to the home market effect. This corresponds with the fact that China was a net importer of manufactured goods initially, and became a net exporter recently. These results are consistent with the data obtained after the reform and opening‐up policy in 1978.

Relationship Between Exchange Rate and Inflation in Afghanistan

Afghanistan is an import dependent country and has been facing perpetual trade balance deficit for decades. In case of imperfect competition in the market or existence of market monopoly, there is a higher chance of reflecting the exchange rate changes on the prices of the goods. In Addition, countries with low level of domestic production and higher amounts of imports usually experience higher degree of the exchange rate pass-through effect on inflation. Countries with high import volumes and low export levels often face a deficit in foreign currency inflows and an excess in outflows. These countries need substantial foreign currency to purchase and import goods from both neighboring and international markets, increasing domestic demand for foreign currencies and consequently leading to domestic currency depreciation. This study investigated the relationship between exchange rates and inflation in Afghanistan, examining how exchange rates impact inflation and the benefits associated with exchange rate mechanisms. The primary research questions include: What is the relationship between exchange rates and inflation in Afghanistan? How does the exchange rate influence inflation in the country? What are the benefits of exchange rate systems? The hypothesis posits that higher inflation typically depresses a country's currency value and that exchange rates directly affect inflation. Additionally, exchange rates determine the value of currency exchanges between different nations. This research aims to elucidate the relationship between exchange rates and inflation in Afghanistan, assess the impact of exchange rates on inflation, and explore the benefits of exchange rate systems. The methodology involves a binary system and utilizes secondary data collected from books, websites, and research papers. Findings indicate that Afghanistan's reliance on imports results in a persistent trade balance deficit, with a significant portion of goods, especially non-food items, being imported due to insufficient domestic production. To import goods, Afghanistan requires foreign currencies, which are typically earned through exports of goods and services as of a result, Afghanistan will experience stability in the exchange rate and in the domestic prices.

Trade, gender equality and institutional quality: Evidence from the gravitational approach

Purpose The contributions of gender equality to trade and the moderating impact of institutional quality on the trade-gender link have been understudied in contemporary literature. Therefore, this paper aims to use the augmented gravity model to investigate the impacts of gender equality and institutional quality on trade, and the moderating impact of institutional quality on the trade-gender link. Design/methodology/approach The panel data is comprised of bilateral trade flows of Vietnam and 40 major trading partners in the 2002–2021 period. Estimation methods include combined fixed effect, random effect, system generalized method of moments two-step (SGMM-II) and Poisson-pseudo maximum likelihood (PPML) which allow the treatment of heterogeneity, endogeneity and heteroskedasticity in the research models. Findings The exporting country’s gender equality has an inconclusive impact on trade in SGMM-II and PPML estimations. However, female labor force participation in the exporting country increases trade. Importing country’s gender equality and female labor force participation increase trade. The direct impact of institutional quality on trade is inconclusive, which is dependent on estimation methods. Most noticeably, the institutional quality of exporting and importing countries facilitates the hampering effects of gender equality and female labor force participation on trade. Research limitations/implications Future research should apply the framework of this paper to sectoral trade, which allows more sector-specific policy implications to be delivered. Moreover, gender development, gender inequality and institutional quality should be included in the SGMM estimations as endogenous variables for robustness checking purposes in future research. Practical implications The paper has justified the integration of gender-specific issues in trade policies, which aligns trade with sustainable development agenda. The explored moderating impact of institutional quality of the exporting country has implied the trade-off relationship between gender equality and export growth in the effort to improve institutional quality. Reversely, in the case of importing countries with higher institutional quality, improved gender equality may mitigate the trade deficit by hampering import growth. Originality/value Investigating the impact of gender equality on trade is the prominent contribution of this paper. Gender equality is considered by three component indicators which include gender development, gender inequality and female labor force participation. New measurement approach to the institutional quality level is also introduced. Furthermore, the explored moderating impacts of institutional quality on the trade-gender link are novel in the literature on sustainable development.

Inflation-balance of trade nexus in Nigeria: The impact of exchange rate pass-through

The relationship between exchange rate (EXR) and foreign trade (FT) in Nigeria has been a contentious issue since Nigeria’s independence in 1960. This study investigated the link between exchange rate and foreign trade through the prism of exchange rate pass-through (EXRPT) to domestic prices, utilizing monthly data from 2011 to 2022. The study was built on two models—the base and main models respectively. Employing the VAR technique and its Vector Error Correction Model (VECM) extension, the paper found that EXRPT to consumer prices is incomplete in the short run but its effect was found to be higher on imports than on consumer prices. It follows that the impact of EXRPT diminishes along the price chain. Results from the main model indicate that the impact of domestic prices on balance of trade was found to be negative with elasticity of −0.437541and is also statistically significant, thus, confirming the Marshal-Lenner condition. The Marshal-Lenner condition and findings of this study provide evidence that depreciating exchange rate is not recommended for an import inelastic country like Nigeria.

The role of peatlands in carbon footprints of countries and products

Global peatland degradation is a major emission source (2 Gt CO2eq/yr), but it is often excluded from product carbon footprints or consumption-based emission inventories. The aim of this study was to analyze the impact of peatlands on the carbon footprints of countries and products. The analysis was performed by combining the updated Global Peatland Assessment emission inventory with the EXIOBASE 3 multiple-region input-output model and propagating the emissions from primary production to final demand of products. The structure of the network of production and consumption was analyzed by identifying the paths and nodes that had the highest embodied peatland emissions. Based on the analysis, the consumption-based emission inventory had hotspots in Indonesia, China, and Russia, where a few key sectors (construction, rice, and other foods) contributed to 31 % of the global peatland emissions. Unlike in many other environmental impact categories, Europe was a net exporter (104 Mt CO2eq/yr) of embodied peatland emissions and Africa & Middle East region was the largest net importer (64 Mt CO2eq/yr). The embodied peatland emissions are focused on agricultural and forestry products in the countries with the largest share of degraded peatlands. Products originating from peatlands can have multiple times higher carbon footprints than non-peatland farmed products. The societal cost of carbon (SCC) of peatland originating products can even be higher than the value of the products. Therefore including peatland emissions into product carbon footprints would create incentives for mitigating emissions. Local emission mitigation will require tailored combinations of rewetting, restoration, and paludiculture. As the current uses of peatlands are emission intensive and have low value added, the potential for cost-effective emission reduction is considerable.

India’s Balance of Payment Position: An Overview

As far as Indian BOP is concerned, over the years generally balance of trade indicated deficit while balance of services remained in services. Main reason being imports of India for the visible items such as crude oil and gold far exceed the exports by India but on services account India being known for skilled force rendering services abroad and being IT hub, net services stood in surplus and similarly private transfer payments in the form remittances usually indicate surplus. However, surplus in BOP does not always guarantee the prosperity and likewise deficit does not always signals danger towards the solvency of a nation. Surplus on current account and favourable balance of payment may be on account of massive foreign debt and unprecedented private capital inflows. Thus, favourable BOP may eventually become fatal if the reasons for surplus not carefully considered by authorities and rather become careless in managing BOP. Similarly, BOP deficit cannot be taken as threat to the domestic economy if it is due to huge amount of financial aid to other countries and capital outflows but otherwise continuous BOP deficit may eventually lead to a critical situation such as BOP crisis. Thus, BOP analysis should be performed carefully and results of analysis should be critically evaluated to take appropriate measures to save the domestic economy at the global level.

Analisis Peluang dan Ancaman Perdagangan Bahan Pangan serta Kebijakan untuk Mengatasinya: Studi Kasus Indonesia dan Thailand

This research examines the potential for Indonesian agricultural exports to Thailand in the context of ASEAN trade. The analysis focuses on the comparative advantages of the two countries in key agricultural commodities such as rice, corn, sugar, palm oil and coffee. Production and export data for 2022 shows that Indonesia is ahead in palm oil and coffee production, while Thailand is dominant in rice and sugar exports. The 2021-2023 trade balance of both countries shows a deficit, with Thailand experiencing a much larger deficit. Despite facing challenges such as price fluctuations, climate and trade regulations, Indonesia has the opportunity to increase its agricultural exports to Thailand by improving production efficiency and product quality.

Stock Reverberation Due to International Trade Related Economic Factors

The economic activities of a nation are measured through various macroeconomic factors such as GDP, EXIM rate, unemployment level, Wholesale Price Index (WPI), and Consumer Price Index (CPI). Numerous studies have focused on identifying the association between inflation and stock prices, with some also highlighting the relationship between gold prices and stock price volatility. This study uses exchange rate and balance of trade as indicators to predict stock price volatility in China. The stock price volatility is measured using the Shanghai Stock Exchange Composite Index (SSE Composite Index). An analytical method is employed to evaluate the involved variables, with Johansen integration used to determine the relationships between them. The Vector Error Correction Model (VECM) is utilized to model these relationships. The Granger causality test and Johansen co-integration test measure the causal relationships of economic variables on the stock market indices. The findings indicate that the exchange rate positively influences stock prices, whereas the balance of trade shows a negative relationship. The exchange rate Granger-causes stock prices, but the reverse is not true. A similar Granger-causing relationship exists between the balance of trade and stock prices. The study also reveals that while the exchange rate of RMB to USD may not have a strong impact on stock prices, the exchange rates of other currencies may significantly influence China's stock prices.

Green hydrogen production in Uruguay: a techno-economic approach

Abstract In 2015, the participants of the Paris Agreement collectively acknowledged the urgent need for immediate actions to decarbonize their national economies, with the aim of mitigating the adverse impacts of climate change. There is a call for policymakers to step up efforts to significantly reduce greenhouse gas (GHG) emissions in all economic sectors, with a focus on prioritizing options that can deliver substantial emission cuts. Some industry and transport subsectors present significant challenges in terms of technical and economic feasibility. Viable solutions for these sectors, known as “hard-to-abate” sectors, are limited. Green hydrogen has emerged as a promising alternative that is gaining increasing attention. It is poised to play a crucial role in transitioning towards a more sustainable future. There is a growing interest in green hydrogen among researchers, institutions, and nations, all committed to advancing its development, improving efficiency, and reducing costs. This paper explores the concept of green hydrogen, particularly its production processes that rely on renewable energy sources in Uruguay. It demonstrates the significant potential for green hydrogen production, facilitating the transition from fossil fuels to clean energy and promoting environmental sustainability through the widely accepted electrolysis process. Uruguay currently boasts a high percentage of renewable electricity generation (reaching 97 % in 2020). To support this further, there is a need to increase renewable energy capacity, which would impact the energy prices. The cost of energy accounts for more than 40 % of the levelized cost of hydrogen (LCOH) in all studied scenarios. Additionally, optimizing the costs associated with electrolysers, which can exceed 30 % of the LCOH in polymer electrolyte membrane (PEM) electrolysis, is crucial. This optimization is essential for positioning the country as a net exporter of green hydrogen. The range of LCOH values calculated in the different scenarios is between 2.11 USD/kg H2 and 4.12 USD/kg H2. According to updated specialized literature, achieving LCOH values under USD 1.4/kg H2 is essential for this goal.

Circulation in a tropical embayment with two inlets and complex geometry: The Itamaracá-Itapessoca system, Brazil

Along the northeast coast of Brazil, numerous estuaries with intricate morphologies, characterized by multiple channels, islands, and intertidal areas, are found. These estuaries undergo significant seasonal variations, experiencing pronounced wet and dry periods. While some of these systems have small drainage basins with minimal freshwater inflow and sediment production, they boast extensive intertidal mangrove areas. This study focuses on assessing the hydrodynamics and residual circulation of the Itamaracá-Itapessoca Estuarine System (IIES) to elucidate the impact of residual circulation on estuary-shelf exchange dynamics. The IIES comprises two main islands and two inlets surrounded by extensive intertidal areas. Field observations collected during the wet season were used to calibrate and validate a numerical model. Two model scenarios were examined: a 'dry' scenario, considering hydrodynamics driven solely by interactions between morphology and tides, and a 'wet' scenario, incorporating freshwater inflow. Key findings include: (a) the inclusion of freshwater inflow minimally alters system dynamics; (b) tidal dynamics are amplified within the system, resulting in a null zone between the inlets; and (c) residual circulation circulates around the islands, with net importation through the larger inlet and net exportation through the smaller one. The intensity of exchange is heightened under wet conditions.

The Impact of FDI, Portfolio Investment, Tourism, Inflation, Net Exports, and Exchange Rate on Asean-6 Balance of Payments: The Moderating Role of Corruption Perception Index from an Islamic Perspective

The Impact of FDI, Portfolio Investment, Tourism, Inflation, Net Exports, and Exchange Rate on Asean-6 Balance of Payments: The Moderating Role of Corruption Perception Index from an Islamic Perspective

Understanding the Nexus between Oil Price Volatility and Trade Balance in GCC Countries: A Comparative Investigation of Panel Linear and Nonlinear ARDL Models

Understanding the Nexus between Oil Price Volatility and Trade Balance in GCC Countries: A Comparative Investigation of Panel Linear and Nonlinear ARDL Models

Liquidity, Liquidity Everywhere, Not a Drop to Use: Why Flooding Banks with Central Bank Reserves May Not Expand Liquidity

ABSTRACTCentral bank balance sheet expansion, through actions like quantitative easing, is run through commercial banks. While this increases liquid central bank reserves held on commercial bank balance sheets, demandable uninsured deposits issued to finance the reserves also increase. Subsequent shrinkage in the central bank balance sheet may entail shrinkage in bank‐held reserves without a commensurate reduction in deposit claims. Furthermore, during episodes of liquidity stress, when many claims on liquidity are called, surplus banks may hoard reserves. As a result, central bank balance sheet expansion may create less additional liquidity than typically thought, and indeed, may increase the probability and severity of episodes of liquidity stress.