Impact Of Non-tariff Measures Research Articles

The Impact of Non-Tariff Measures on the Exporting of Agricultural Products of Cambodia

The production and exporting of agricultural products were considered one of the most important roles of the Cambodian people. In the free trade world, tariff measures were not determined to be the main obstacle to moving products from one country to worldwide, but non-tariff measures, NTMs, were defined to be the main problem nowadays. An empirical investigation using the gravity model with four classes of NTMs: SPS, TBT, PSI, and NTB was carried out to assess the impact of Cambodia’s exported agricultural products abroad. In order to generate robust standard errors for hypothesis testing, the Ordinary Least Square (OLS) estimation method was combined with the bootstrapping technique. The results of this research supported the gravity model hypothesis, however, SPS and PSI were negatively affecting Cambodia’s exporting at significant levels of 10 percent and 1 percent, respectively, while the TBT measure had a positive influence on trade at a level of significant of 1 percent. In contrast, the NTB class had no significant impact on exports.

Assessing the impact of non-tariff measures on Sri Lankan mango exports: insights, challenges, and recommendations

IntroductionWith the increase in non-tariff measures (NTMs) in recent years, understanding their impact on trade policies and agricultural exports is of utmost importance for countries like Sri Lanka, where the proliferation of NTMs has posed substantial impediments to its mango export industry. However, studying NTMs can be challenging due to their complex nature, diverse range, and limited information availability.MethodsThis research aims to investigate the significant effect of NTMs on Sri Lankan mango exports, identify the pivotal drivers influencing mango exports, and analyze the performance of mango exports in Sri Lanka. This study utilized a panel dataset of 16 importing countries spanning the period from 2000 to 2021. The primary focus was on examining NTM-related challenges and obstacles faced by the mango export industry in Sri Lanka. The identification and quantification of these obstacles were achieved through a multifaceted approach in which assessment of NTM-related rejections, both domestic and overseas, evaluation of NTM incidences using frequency and coverage ratio measures, and the deployment of various gravity model equations to quantify the effect of NTMs were taken into consideration. Probit, Ordinary Least Square, Random Effects, and Poisson Pseudo Maximum Likelihood estimation techniques were utilized for data analysis.ResultsThe findings indicate a significant inverse correlation between the increase in the total count of NTMs and Sri Lankan mango exports if the country aims to export more mangoes to relevant markets, while Sanitary and Phytosanitary Measures (SPS), Technical Barriers to Trade (TBT), and Pre-shipment Inspection (PSI) contributed to increased mango exports. Among other explanatory variables, the GDP of both importing and exporting countries had a positive influence on Sri Lankan mango exports. Surprisingly, the distance to the importing country had no significant effect, though it shows a negative sign.DiscussionThis study provides valuable insights into the impact of NTMs on Sri Lankan mango exports. It highlights the considerable influence of NTMs on the overall fresh fruit export sector. We recommend proactively aligning internal quality testing regulations with the standards required by destination countries to promote future expansion.

Unleashing Vietnam’s Rice and Coffee Exports: Decoding The Power of Non-Tariff Measures in the CPTPP Market

Rice and coffee are vital commodities in Vietnam’s economy. Amidst the evolving dynamics of global trade, the substitution of traditional tariff barriers with non-tariff measures (NTMs) is progressively increasing, and the CPTPP market is not exempt from this trend. Using the gravity model, this study explores the factors influencing Vietnam's rice and coffee exports to the CPTPP market. The study finds that economic factors, such as GDP, have a significant impact on export values. Import tariffs hinder exports, while lower tariffs enhance competitiveness. Geographical distance affects transportation costs and export values. The impact of NTMs on exports is mixed. Vietnam's CPTPP membership offers integration opportunities, albeit gradually. The COVID-19 pandemic has negatively affected exports, highlighting vulnerability. Policy recommendations include addressing adverse NTMs, promoting favorable measures, aligning legislation with the CPTPP, enhancing quality, and researching export markets and regulations. These recommendations aim to improve export performance, mitigate shocks, and leverage trade agreement benefits for the rice and coffee sectors.

Evaluating the Performance, Export Competitiveness and Direction of Trade of Indian Banana in the International Market

ABSTRACT The study examined the changing pattern of international trade in bananas globally and in India at a macro level from 2000 to 2020. It analyzed the growth pattern, direction of trade, trade competitiveness, and market access issues like tariff and non-tariff barriers (NTBs) faced by exporters in major markets. The analysis revealed that the export of bananas from India increased from $8.10 thousand to $212 thousand from 2000 to 2020, with an annual growth of 21 per cent. Iran, UAE, Oman, and Saudi Arabia are the major destination markets for Indian bananas, wherein India exports more than 70 per cent of its banana export. Banana exports from India possess export competitiveness as the Nominal Protection Coefficient (NPC) was less than one (ranging between 0.28 to 0.70), and the domestic prices were lower than the international prices. Oman emerged as a stable market for banana imports from India in quantity and value terms. Iran and Nepal were the most important markets for Indian bananas but Kuwait and Saudi Arabia markets were unstable markets for Indian bananas. Among the major importing countries of Banana, Japan has imposed the highest number of notifications (164 Non-tariff Measures (NTMs)) on total imports of India since 1995. The USA imposed 119 NTMs, and the EU imposed 65 notifications. Still, it had imposed more TBT measures (35). Regarding Sanitary and Phytosanitary (SPS) measures, agricultural goods do not involve technological prowess but only consider consumer health and safety issues, which can be harmonized as it is good for trading partners. For Technical Barriers to Trade (TBT) measures driven mainly by technology, India must follow the same approach carefully. Future research should concentrate on the impact of NTMs in depth by considering all the stakeholders. Keywords: Banana export, competitiveness, Markov Chain Analysis, NPC. JEL Codes: C88, F13, Q17.

Evaluating the Performance, Export Competitiveness and Direction of Trade of Indian Banana in the International Market

ABSTRACT The study examined the changing pattern of international trade in bananas globally and in India at a macro level from 2000 to 2020. It analyzed the growth pattern, direction of trade, trade competitiveness, and market access issues like tariff and non-tariff barriers (NTBs) faced by exporters in major markets. The analysis revealed that the export of bananas from India increased from $8.10 thousand to $212 thousand from 2000 to 2020, with an annual growth of 21 per cent. Iran, UAE, Oman, and Saudi Arabia are the major destination markets for Indian bananas, wherein India exports more than 70 per cent of its banana export. Banana exports from India possess export competitiveness as the Nominal Protection Coefficient (NPC) was less than one (ranging between 0.28 to 0.70), and the domestic prices were lower than the international prices. Oman emerged as a stable market for banana imports from India in quantity and value terms. Iran and Nepal were the most important markets for Indian bananas but Kuwait and Saudi Arabia markets were unstable markets for Indian bananas. Among the major importing countries of Banana, Japan has imposed the highest number of notifications (164 Non-tariff Measures (NTMs)) on total imports of India since 1995. The USA imposed 119 NTMs, and the EU imposed 65 notifications. Still, it had imposed more TBT measures (35). Regarding Sanitary and Phytosanitary (SPS) measures, agricultural goods do not involve technological prowess but only consider consumer health and safety issues, which can be harmonized as it is good for trading partners. For Technical Barriers to Trade (TBT) measures driven mainly by technology, India must follow the same approach carefully. Future research should concentrate on the impact of NTMs in depth by considering all the stakeholders. Keywords: Banana export, competitiveness, Markov Chain Analysis, NPC. JEL Codes: C88, F13, Q17.

Impact of nontariff measures on the exports of the beverage sector in India

In the recent past, agricultural exports, especially plantation crops, which are the backbone of India, have been subjected to many nontariff measures. Since the liberalisation of trade has led to the integration of global commodity markets, developing countries are significantly affected by these trade barriers, which indirectly hurt millions of plantation community. Traditionally, India is well known for its exports of beverages and stringent maximum residual limits, traceability issues, and food safety standards are complex issues surmounting trade in the plantation sector around the world. Hence, the present research study attempts to find the shock of nontariff measures on the prices of both export and domestic beverages and the hammering in returns to the Indian beverage industry by the partial equilibrium method. This model directly measures the simulation effect of nontariff measures by imposing NTM on tea and coffee sector. It is obvious that as the NTM percent increases from 10 percent to 25 percent on tea sector, the loss in export quantity was more from 22.24 million kg to 55.61 million kg and loss of revenue was from Rs. 2997 million to Rs. 7492 million for the corresponding NTMs. Likewise the loss in export quantity (62.85 million kg) and loss in revenue (Rs. 9412 million) were high in 25 per cent of NTM. The present study shows how to allow for market imperfections and trade facilitating effects of nontariff measures in the beverage sector.

Impact of TBT and SPS measures on domestic value-added exports: evidence from the United States

ABSTRACT This study explores the impact that TBT and SPS measures have on 42 countries domestic value-added exports (DVAs) into the US. The results from this empirical analysis show that both TBT and SPS measures have no significant effect on gross exports, however, TBT measures have a significant inhibiting effect on DVAs, indicating that the traditional gross trade estimation approach underestimates the substantial impact of non-tariff measures on trade gains. To be specific, a 1 percentage point increase in TBT measures leads to DVA exports decrease of 2.37%. Moreover, the negative impact is mainly manifested in developing countries and high-technology products.

Estimating the Impacts of Non-Tariff Measures in the Indian Ocean Rim Association

In recent years, the Indian Ocean Rim Association has witnessed an increasing trend in the use of non-tariff measures (NTMs). This study evaluated the impact of NTMs in the Indian Ocean Rim Association through estimations of their ad valorem equivalents at the HS chapter and country levels. A gravity model using NTM count data (intensity) was specified and estimated to derive the importer-specific ad valorem equivalents for the four (4) most used NTMs in the region. The results showed the presence of both import-impeding and import-promoting effects of NTMs; however, the import-impeding effects dominated in the region. The quantitative restriction and safeguard measures were more restrictive compared to the sanitary and phytosanitary measures and technical barriers to trade. This was expected since quantitative restrictions are trade-distorting by design. This calls for reforming trade policy in the region toward NTMs that are more transparent and trade enhancing for successful subsequent trade negotiations in the Indian Ocean Rim Association, which would support the sustainable economic development of the region.

PECULIARITIES OF CLASSIFICATION AND USE OF NON-TARIFF REGULATION MEASURES

Purpose. The purpose of the research is to conduct a systematic study of existing classifications of measures of non-tariff regulation of foreign economic activity and analysis of the dynamics of the use of specific methods of non-tariff regulation in Ukraine and the world. Design/methodology/approach. The study examined the hypothesis of the lack of a single unified classification of measures of non-tariff regulation of foreign economic activity on the basis of a study of the most commonly used classifications in Ukraine and in the world, determining their common and distinctive features. In order to achieve the purpose of the research, general scientific methods of scientific knowledge were used: analysis and synthesis, theoretical generalization, formalization, observation, systematization. Findings. It is found out that there are many classifications for non-tariff regulation, but the most common are classifications of the World Trade Organization and the United Nations Conference on Trade and Development (UNCTAD), but the last one is more popular and used for formation of a global database on dynamics of non-tariff regulation measures applying. In addition, the current classification of non-tariff regulation measures of the World Trade Organization deserves attention, it contains up-to-date information on the dynamics of the use of existing and initiated non-tariff regulation measures by WTO members. The hypothesis of the absence of a single unified classification of measures of non-tariff regulation of foreign economic activity based on a study of the most commonly used classifications in Ukraine and in the world, their common and distinctive features can be considered proven, as evidenced by the results of the study and generalized conclusions. Practical implications. The studied classifications are of great practical importance, as they allow international market participants to monitor the use of non-tariff regulation measures. The hold analysis showed that among all non-tariff regulation measures in 2021, most countries in the world used technical measures related to imports, in particular, sanitary and phytosanitary measures (A) - 29750, technical barriers to trade) - 25772, as well as exports-related measures - 7804, quantitative restrictions - 6438. The same can be said about Ukrainian practice of non-tariff regulation measures usage. Originality/value. It is established that the UNCTAD classification is the most comprehensive and suitable for the purposes of economic analysis. The impact of non-tariff measures on trade as well as on welfare is less clear than the impact of tariff restrictions. On the one hand, non-tariff measures often restrict trade flows, which has a negative impact on welfare. On the other hand, there are a number of non-tariff measures, the application of which contributes to the growth of welfare by ensuring the highest quality of goods offered on the market, which is an independent value for consumers. The use of non-tariff instruments should be treated with caution, as they are not devoid of dualism and may have contradictory consequences, as well as provoke a similar response from partner countries.

Streamlining Non-tariff Measures for Agri-food Trade in ASEAN

Streamlining non-tariff measures (NTMs) plays an important role in improving market access for trade in goods among ASEAN-10 countries. An assessment of the impact of NTMs in ASEAN reveals that the agri-food trade has been constrained by contingent trade protective measures, quantity-control measures, technical barriers to trade (TBT), and sanitary and phytosanitary (SPS) measures. The proliferation of SPS and TBT measures, coupled with their severe effects, suggests the need to accelerate NTM reforms in ASEAN.

Correlation between misinvoicing and non-tariff measures for Turkey's exports to the EU

AbstractMany researchers have analysed the factors that cause discrepancies in the mirror trade statistics. However, the conflicting findings of the relatively limited number of studies on the relation between non-tariff measures and misinvoicing make further research in this area necessary. Therefore, our paper aimed to analyse the impact of non-tariff measures on misinvoicing in the context of Turkey's exports to the European Union (EU) between 2008 and 2015. This study tested the possible relationship between them using other measurable variables related to Turkey's exports to the EU of the products to which the non-tariff measures were applied. This has been done by employing the dynamic generalized method of moments (GMM) as well as the quantile regression (QR) models. It was observed that tariffs, along with non-tariff measures, have negative relationship with the misinvoiced amount. Additionally, it is also observed that the transfer price manipulation appears to be a means of corporate tax evasion. This finding aligns with the decrease in reported imports and the decrease in the perceived levels of corruption.

The Impact of Non-Tariff Measures on Sri Lankan Tea Trade: A Bayesian Inference of the Gravity Model

The Impact of Non-Tariff Measures on Sri Lankan Tea Trade: A Bayesian Inference of the Gravity Model

On the proper computation of Ad Valorem equivalent of non-tariff measures

ABSTRACT In all the previous studies evaluating the Ad Valorem Equivalent (AVE) of Non-Tariff Measures (NTMs) based on a gravity equation, Jensen’s inequality is not considered. Yet the issue of estimating the impact of dummy or count variables in semi-log or related equations has been raised since the early eighties. In this article, we illustrate the bias associated with the omission of Jensen’s inequality and show that when it is not considered, the estimation of AVEs can be significantly biased. This omission leads to a significant underestimation of the restrictive impact of NTMs and can even change the sign of the AVE.

The Effect of Non-Tariff Measures on Global Value Chain Participation

ABSTRACT This study takes a novel approach by using an additional compliance requirement indicator as a relative proxy for non-tariff measures (NTMs) to measure the impact of NTMs on global value chain (GVC) participation. We conduct a cross-sectional analysis at the industry level, spanning 30 countries with 19 industrial sectors in the year 2015. Our analysis finds that both NTMs and tariffs have negative impacts on backward GVC participation, and the impact of NTMs is greater than that of tariff measures. Therefore, policies that reduce trade costs from policy barriers, especially NTMs, can help promote participation in GVCs.

NON-TARIFF MEASURES (NTMS) AND INDONESIAN NATURAL RUBBER EXPORT TO THE MAIN EXPORT DESTINATION COUNTRIES

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

NON-TARIFF MEASURES IMPACT ON INDONESIAN FISHERY EXPORT

This study aims to analyze the impact of Non tariff measures using sanitary and phytosanitary policy (SPS) and technical trade barriers (TBTs) on fishery exports of Indonesia and its trading partner countries such as China, South Korea, Vietnam, Canada, Russia and the European Union in period of 2007 to 2016. SPS and TBT are measured using inventory approach in the form of coverage ratio. In addition, this study uses a gravity model and panel data regression method. The results of this study indicate that the variables GDP of exporting country and GDP of importing country have a positive and significant effect on Indonesian fishery exports. Distance and SPS have a negative and significant effect on Indonesian fishery exports, while TBT has no effect on Indonesian fishery exports. Keywords: Export, SPS and TBT, Fishery Export, coverage ratio

Impact of nontariff measures on firms in Tunisia

AbstractThis paper analyzes the effect of nontariff measures (NTMs) on firms in Tunisia. It draws a precise picture of NTMs’ effects on firms’ imports. We use firm‐level data to take into account firm heterogeneity. We explore the impact of NTMs on small vs. medium and large firms. We also consider the differentiated impact of NTMs. Some measures have informational content and help reduce information asymmetries. When the endogeneity issue of NTMs is controlled for, results show an overall positive impact of NTMs on imports. They provide evidence that NTMs are more beneficial to the imports of medium and large firms. Moreover, NTMs with informational content have an import enhancing effect. An extended analysis separating importing and exporting firms from those solely importing suggests that both types of firms benefit from the positive effects of NTMs. This result highlights the need to assist small firms facing NTMs. Furthermore, some NTMs with informational content should be addressed carefully and not considered only as barriers to trade to be eliminated. Instead, harmonization efforts between countries can be a better policy.

On the impact of non-tariff measures on trade performances of the African agri-food sector

ABSTRACTThe increasing interest of policymakers and academics on non-tariff measures (NTMs) has stimulated a growing literature on their effects on the agri-food trade of African countries. The empirical evidence, however, is ambiguous: some studies suggest that NTMs are trade barriers and others suggest they have a catalyst role for trade. Understanding the drivers of these contrasting effects, and the prevailing one, would allow one to draw important conclusions.We review, through a meta-analytical approach, a set of empirical studies that quantify the effects of NTMs on African agri-food trade. We find a prevalence of the trade-impeding effects. Our results also help explaining differences in NTMs’ effects due to methodological and structural heterogeneity. Moreover, the effects of NTMs vary across the types of NTMs and analysed commodities.We conclude by comparing our findings with existing literature and emphasise which research areas deserve further investigation, such as intra-Africa trade or trade effects of technical NTMs.

Impact of Non-Tariff Measures on Trade in Mauritius

Gains of international trade are largely based on the absence of trade restrictions among trading countries. The perceived advantage of a steady decrease in tariffs worldwide was unfortunately progressively replaced by non-tariff measures (NTMs) globally. The impact of these NTMs is, however, not exactly clear as it appears in sometimes a much disguised manner. NTMs seem to be very important in limiting the flow of imports to trading countries, although accurately measuring the effects of it is fairly difficult. The purpose of this article is to estimate the impact of NTMs on the volume of trade in Mauritius. The 20 major export destinations of Mauritius are analyzed to determine the impact of tariffs and NTMs on the exports from Mauritius. Using the trade freedom scores as proxy for trade restrictions, it has been established that Mauritius’ volume of export flows are much lower due to the NTMs applied by its importing trading partners.

Trade Restrictiveness Indices in Presence of Externalities: An Application to Non-Tariff Measures

We extend the trade restrictiveness indices (TRIs) approach to the case of market failures and domestic regulations addressing them, in presence of arbitrary tariffs and other domestic price policy distortions. We focus on standard-like non-tariff measures (NTMs) affecting cost of production and potentially enhancing domestic demand by increasing product quality or reducing negative externalities. The impact of NTMs on trade is ambiguous depending on the relative strength of the supply cost and demand enhancing effects. We apply the framework to the NTM database of Kee, Nicita, and Olarreaga (2009) and derive ad valorem equivalents for NTMs and other policy distortions. These equivalents are then used to compute TRIs. 10% of the NTM ad valorem equivalents at the 6-digit level of the Harmonized System are negative indicating a net trade-enhancing effect of these NTMs in those sectors. Consequently, TRIs computed without a protectionist presumption are smaller than their constrained counterparts not allowing for trade enhancements effects of NTMs. Accounting for externalities and anti-protective effects significantly reduces the measure of trade policy restrictiveness for most countries.