Potential Trade Research Articles

Advanced trading strategies based on the sobering-up effect

PurposeThis study investigates analysts’ sobering-up effect on future stock returns and further verifies whether analysts’ familiarity with the forecasted firms and market sentiment affect the relationship between the magnitude of the sobering-up effect on analysts’ earnings forecasts and long-term future stock performance.Design/methodology/approachUsing stocks listed on the Taiwan Stock Exchange (TWSE) and the Taipei Exchange (TPEx) from 2000 to 2021, we propose a trading sobering-up strategy which involves taking a long position in the portfolio with a smaller magnitude of the sobering-up effect and a short position in the portfolio with a greater magnitude of the sobering-up effect.FindingsWe find that an advanced trading strategy which involves taking a long (short) position in the portfolio with a smaller (greater) magnitude of sobering-up effect during the bullish market period, is superior to the sobering-up trading strategy as well as the sobering-up plus familiarity trading strategy and can generate a significantly positive long-term abnormal stock return.Originality/valueThis study explores the dynamic psychological factors behind the magnitude of the sobering-up effect on analysts’ earnings forecasts’ influences. Employing familiarity and market sentiment verify the relationship between the magnitude of the sobering-up effect on analysts’ earnings forecasts and future stock returns. The results give a reference for investors when investing and offer the potential investors significant trading gains.

Peer-to-peer energy trading: Innovations, regulatory challenges, and the future of decentralized energy systems

Peer-to-peer (P2P) energy trading represents a transformative approach to energy distribution, where consumers, referred to as prosumers, generate and exchange electricity directly with one another. This decentralized model promotes local generation and consumption balancing, reducing reliance on centralized grids and encouraging the use of renewable energy. The development of platforms and technologies, such as blockchain, smart contracts, and Internet of Things (IoT)-)-enabled devices, has enabled secure, transparent, and automated transactions. These innovations facilitate real-time monitoring and energy matching, while artificial intelligence (AI) optimizes pricing and supply-demand dynamics. Microgrids and energy storage solutions further enhance the efficiency and reliability of local energy balancing in P2P systems. However, the widespread adoption of P2P energy trading faces significant regulatory and market challenges. Current regulatory frameworks, designed for traditional, centralized energy markets, often lack provisions for decentralized trading models. Key issues include grid access, tariffs, consumer protection, and data privacy. Furthermore, regulatory barriers differ widely by region, affecting the pace of P2P adoption. Market mechanisms that support P2P energy trading, such as dynamic pricing, demand-response programs, and real-time settlement systems, are also critical for its success. The role of aggregators and intermediaries in facilitating transactions is evolving, as regulatory bodies explore sandbox environments to test these innovative models. This review explores the technological advancements and regulatory landscape shaping P2P energy trading, highlighting successful case studies and identifying future trends. It underscores the need for adaptable policies and robust platforms to unlock the potential of P2P energy trading in building resilient, sustainable, and decentralized energy systems.

An analysis of geographical indications in terms of international, bilateral and regional agreements

Abstract A geographical indication (GI) serves as a quality label that identifies and assures a product’s origin for consumers, highlighting its unique features and the link between these characteristics and its geographical source. Registering a GI provides protection for products that have earned a reputation based on their quality, tradition, regionally sourced raw materials, and local attributes. GIs play a dual role: they not only help transmit local culture to future generations and promote economic development within a country, but they also encompass products with substantial profit potential in international trade. Items such as cheeses, processed animal products, and naturally grown goods (e.g., hazelnuts, grapes, figs) are commonly traded internationally under GI protections. This study aims to analyze international, bilateral, and regional agreements related to GIs, specifically those covering appellations of origin. The analysis includes the 1883 Paris Convention, the 1891 Madrid Convention, the 1958 Lisbon Agreement, and more recent agreements on trade-related intellectual property rights under the World Trade Organization (WTO), as well as bilateral and regional agreements on GIs among countries. Although these agreements address international disputes and trade matters concerning GI products, findings indicate that they can also lead to various challenges between countries regarding the protection and trade of these products. Keywords: Agricultural Trade, Geographical Indication, TRIPS, International Trade Agreements, WTO, Intellectual Property JEL Classification: F13, F15, O34, Q17

Study on the Efficiency and Potential of China's Tire Export Trade to Ten ASEAN Countries under the Perspective of “One Belt, One Road”

Tires are an important product category in China's export trade. Based on the stochastic frontier gravity model, this paper uses the panel data of China's tire export trade to the ten ASEAN countries from 2018 to 2022 to study the influencing factors of bilateral trade in tire exports, and to measure China's export trade efficiency, export potential and expandable space to the ten ASEAN countries. Based on these three indicators, we analyze the future prospects of China's tire product exports to the ten ASEAN countries. The results show that: (1) in the stochastic frontier model, GDP per capita, population, border variables and language variables of both sides of trade as natural factors have a significant positive impact on tire export trade. (2) In the trade inefficiency model, liner transportation connectivity, trade freedom and financial freedom of both sides have a significant positive impact on tire export trade. (3) China's overall tire export efficiency and potential to the ten ASEAN countries is high, but the country-specific differences are obvious, and the trade as a whole still has more room for improvement. (4) China's tire export potential market can be divided into saturated, expanding, developing and iceberg type, of which the expanding type includes Malaysia, Vietnam, Thailand and Brunei 4 countries, the developing type includes Cambodia, Indonesia and Singapore 3 countries, of which Malaysia and Singapore is the need to pay attention to the overseas market.

India’s Deep Integration with South Korea and Japan: A Trade Analysis

India has negotiated comprehensive economic partnership agreements (CEPAs) with highly industrialized giants, Japan and South Korea, aiming to unlock significant trade potential. However, a crucial question remains: How significantly have these regional trade agreements advanced after a decade of enforcement, and what impact are they having on global economies? To address this, we conducted a detailed analysis at the aggregate and sectoral levels, comparing the India–Japan and India–Korea deep integrations by evaluating the trade creation and diversion effects. Our research uses a structural gravity model for a panel of 205 exporting countries between 1988 and 2021. At the aggregate level, the findings reveal a modestly greater increase in intra-regional trade due to the India–Japan CEPA and greater export diversion effects of the India–Korea CEPA. However, the effects of import diversion on the India–Japan CEPA remain indeterminate. At the sectoral level, India’s trade with Japan has an advantage in more sectors than Korea, though the extent varies. The findings emphasize that sector-specific measures will notably nudge the strategies of competing trade partners.

Interplay of Chinese rare earth elements supply and European clean energy transition: A geopolitical context analysis

The European clean energy sector sources approximately 98 % of its rare earth materials from China. We examine Chinese rare earth supply's effect on European renewable energy, particularly solar and wind sectors from 1990 to 2020. Using the gravity model, we find a positive correlation between China's rare earth supply and European solar energy during bullish markets. A similar response is seen in wind energy during bearish markets, considering global and China-specific geopolitical risks. We also observe a negative correlation between China's economic growth and mineral supply to Europe, with European income growth having no significant impact. Additionally, multiplicative economic growth negatively impacts Chinese mineral supply. The study also reveals a positive link between oil prices, rare earth export prices, geopolitical risks, and China's mineral exports. Distance negatively affects supply dynamics in the wind model but not in the solar model. However, the originality of this study lies in its examination of China's role as a rare earth supplier for Europe's clean energy transition, integrated into a gravity model. Significantly, this research provides potential trade insights and formulates an economic policy implication framework to guarantee a steady supply of China's rare earths for Europe's green deal objectives, while addressing the associated geopolitical risks.

Trade of legally protected orchids in Indonesian e-commerce markets

Summary Online markets are becoming increasingly important for the trade of orchids. However, the sale of orchids online raises conservation concerns, as some sellers use these platforms to bypass regulations. In March 2024, we assessed the extent of trade of 28 nationally protected orchid species in the five most visited Indonesian-language online markets. Twenty-four of the 28 orchid species protected in Indonesia were being traded online, involving 1294 advertisements posted by 789 sellers. The majority (93%) of these sellers were located in Java; 3882 orchid individuals were sold during the performance of this research, with a total trade value of IDR 262 129 387 (USD 16 911). Furthermore, there were 2 831 688 orchid individuals reported to be available in stock by sellers, with a total potential trade value of more than IDR 231 billion (USD 14.9 million). None of the recorded sellers in the present study declared a permit for the orchids they offered. Our findings can be utilized by law enforcement agencies to identify key players and areas involved in this trade, as well as by conservationists and policymakers to determine which species are being traded and so might require further conservation measures.

Carbon Sequestration Potential of Rhizophora mucronata in Tongke-Tongke Mangrove Forest, Sinjai Regency, Indonesia

Mangroves play a crucial role in coastal ecosystems, offering significant ecological benefits and acting as important carbon sinks. This study focuses on the carbon sequestration potential of Rhizophora mucronata in the Tongke-Tongke mangrove forest, Sinjai Regency, Indonesia. By measuring the carbon content in leaves, roots, and sediments, the study found carbon content ranges from 0.09 to 0.11 tons/ha in leaves with a carbon absorption capacity ranging from 0.33–0.42 tonnes/ha and 0.44 to 0.72 tons/ha in roots with absorption capacity reaching 1.60–2.64 tonnes/ha, with sediment carbon content varying significantly ranges from 8.66–156.83 tons/ha with an absorption capacity of 31.79–575.55 tons/ha. The carbon content in mangrove stands reaches 109.23–180.87 tonnes/ha, with carbon uptake reaching 400.89–663.80 tonnes/ha. Results indicate that R. mucronata has a substantial carbon absorption capacity, underscoring the importance of these ecosystems in climate change mitigation. The findings aim to inform conservation strategies and potential carbon trading initiatives, contributing to global climate resilience.

Do clean fuel and trade-openness reduce environmental degradation in China: evidence from asymmetric model

IntroductionThis study investigates the relationship between economic growth, clean fuel utilization, trade, and environmental pollution. By focusing on the potential of clean fuels and trade in reducing pollution, this research aims to understand their role in promoting environmental sustainability in China from 1990 to 2020.MethodsThe study employs the Nonlinear Autoregressive Distributed Lags (NARDL) approach to analyze time series data. This method enables the decomposition of impacts from clean fuels and trade on pollution levels, facilitating an understanding of their distinct contributions to environmental outcomes.ResultsFindings indicate that economic growth is associated with an increase in pollution levels, while clean fuel usage exhibits a modest but significant reduction effect. Nonetheless, the relatively small coefficients highlight the need for a greater share of clean fuels in China’s energy mix. Additionally, trade shows a significant negative relationship with pollution emissions, with data reflecting a gradual decline in pollution over time.DiscussionThese results underscore the benefits of clean fuel adoption and trade promotion as effective measures for mitigating pollution. However, they also highlight the necessity for stronger regulatory policies, public awareness initiatives, and investments in sustainable technologies to ensure China’s long-term environmental sustainability.

THE POTENTIAL FOR PEER-TO-PEER ELECTRICITY TRADING IN GEORGIA

The global energy transition is fundamentally reshaping electricity markets, moving from centralized systems reliant on fossil fuels to decentralized, renewable energy solutions. Distributed energy resources such as solar panels and storage batteries are empowering consumers to become active participants in the energy market. Peer-to-peer (P2P) electricity trading, enabled by blockchain technology, presents a new model for consumers to trade surplus energy directly with one another, bypassing traditional suppliers. This article explores the potential of P2P electricity trading in Georgia, a country with significant renewable energy resources but limited experience with decentralized energy systems. As Georgia aligns its energy policies with European regulations, the development of a P2P trading market could enhance energy security, empower prosumers, and drive local economic development. Through an analysis of global trends, technological innovations, and the current Georgian energy landscape, this article assesses the opportunities and challenges in implementing P2P trading. By building the necessary infrastructure and fostering public participation, Georgia has the potential to transform its energy market and contribute to a more resilient and sustainable energy future.

Evaluation of a Peer-To-Peer Smart Grid Using Digital Twins: A Case Study of a Remote European Island

Decarbonization of the built environment by electrifying energy systems and decarbonizing the electrical grid coupled with the digitization of these systems is a central strategy implemented by the European Commission (EC) to meet carbon reduction policies. The proliferation of technologies such as renewable energy sources (RES) and demand-side management (DSM) systems can be improved by using digital twins to predict and optimize their integration with existing systems. Digital twins in the built environment have been used for multiple purposes, such as predicting the performance of a system before its inception or optimizing its operation during use. To this end, a novel application of a combination of these technologies towards optimized DSM is peer-to-peer (P2P) energy trading, which can improve the local use of RES in the built environment. This paper investigates the potential of P2P energy trading in optimizing local RES of a remote island, Inishmore, Republic of Ireland, using a combination of data-driven and predictive digital twins towards the island’s journey to net zero. Data-driven digital twins are used to evaluate the current energy use at the pilot site. Predictive digital twins are applied to estimate the impact of applying P2P in the future and its influence on RES consumption at the pilot site. The findings show that in scenarios with limited RES coverage, P2P can significantly increase the local consumption of excess RES energy, reducing the risk of transmission or curtailment losses. However, P2P is limited in scenarios with widespread RES installation without storage or behavioral change to shift energy loads.

The potential impact of environmental goods trade liberalization on trade and emissions

We combine econometric estimation with quantitative modeling to generate projections on the trade, GDP, and emissions effects of a potential trade liberalization agreement involving energy-related environmental goods (EREGs) and environmentally preferable products (EPPs). Trade liberalization can contribute to reduced emissions in two ways in our projections: (i) a reduction of import prices of goods promoting energy efficiency; and (ii) a reduction in the costs of intermediate and capital goods used in the production of electricity from renewable-energy sources. Four scenarios are evaluated, combining reductions in tariffs and non-tariff measures (NTMs) for EREGs and EPPs. Using simulations with the WTO Global Trade Model we find (i) an increase in exports of EREGs and EPPs both at the global level and in most regions; (ii) a modest increase in GDP in all regions because of falling tariffs, NTMs, and increased energy efficiency; and (iii) a modest reduction in global emissions of about 0.6%. The dominant channel is energy efficiency, whereas the costs of EREGs as intermediates in renewable energy production play a minor role, with or without end-use control.

Impact of the digital trade on lowering carbon emissions in 46 countries

Digital trade, as one of the vanguards of the global technological revolution and industrial transformation, empowers low-carbon economic cooperation on a global scale. This study based on panel data from 2007 to 2021 of 46 countries with varied development levels, constructed a multi-dimensional indicator system from six aspects: trade potential, digital infrastructure, digital innovation, digital skills and security, scale of digital trade, and digital trade environment, aim to measure the development level of digital trade and explore its impact on carbon emissions, followed by a heterogeneity analysis. The research results indicate that there are significant differences in the development levels of digital trade among countries with different economic strengths. Countries with stronger economic power and larger trade scales have a higher level of digital trade development, while less developed regions lag in digital trade. As the level of digital trade development increases, the impact of digital trade on carbon emissions will also change. Overall, digital trade exhibits a pronounced low-carbon effect, while its impact varies among countries with different development levels.

Detecting anomalies in currency market of BRICS countries: insights into emerging economies

PurposeThe primary motive of the research paper is to investigate the efficiency of currency market of emerging economies (BRICS countries), by analyzing the presence and consistency of calendar anomalies – specifically the day-of-the-week (DOW) effect, the January effect and the Turn-of-the-month (TOM) effect. Daily data of around 23 years and 4 months were examined for the purpose of study. Segmented data of 8-year intervals were also analyzed to observe the changes in the pattern over a period. The findings are intended to offer insights into market behaviors and potential trading strategies for astute traders.Design/methodology/approachThe study employed a quantitative research design utilizing ordinary least squares regression with dummy variables and Generalized AutoRegressive Conditional Heteroskedasticity (GARCH) (1,1) model. To study the calendar anomalies, the daily closing price of five currency pairs has been taken from Bloomberg’s software. The Kruskal–Wallis test was conducted to validate and check the robustness of analysis.FindingsThere are mixed results regarding calendar anomalies in the BRICS currency markets. Analysis of aggregate data revealed that DOW effect is present in all the currencies except USDZAR, with Monday showing positive return. The segmented analysis showed the presence of DOW effect in USDCNY and USDINR, while other currencies lacked consistent patterns. The January effect was evident for Indian Rupees and Chinese Yuan but not for other currencies. TOM effect was present only in Chinese Yuan. Overall, the Indian Rupee and Chinese Yuan displayed inefficiencies, indicating potential for trading strategies, while other currencies appeared efficient and lacked consistent patterns.Originality/valueThe literature on currency pricing anomalies is sparse, particularly in the context of developing and underdeveloped economies. While some research exists on anomalies within the currencies of developed nations, there is a significant gap in studies focusing on emerging economies. This paper seeks to address this deficiency by investigating the presence of calendar anomalies in the currencies of BRICS countries, providing new insights into the behaviors of these emerging economies.

Highly pathogenic avian influenza management policy in domestic poultry: from reacting to preventing.

The emergence of clade 2.3.4.4b H5N1 highly pathogenic avian influenza (HPAI) viruses in 2021 has led to unprecedented epidemics in poultry, changing epidemiological patterns of year-round infections in resident wild avifauna and more frequent spill-over events to mammals. Given this situation, it is important that we recognise that traditional HPAI management strategies are no longer sufficient, and policy changes are required. Poultry vaccination has emerged as a crucial intervention in the current control of HPAI, as evidenced by France's nationwide campaign targeting domestic ducks. However, due to the logistical challenges and potential trade implications of vaccination, broader structural reforms appear also necessary. These include a shift from farm-level to territorial-level biosecurity approaches, putting into practice the concept of 'regional biosecurity'. Given the role duck farm density has played in successive HPAI epidemics in France, there is a need to think about the spatial distribution of poultry farms as a structural component of regional biosecurity and to consider the reduction of farm concentration as a measure to prevent viral spread. The integration of regional biosecurity and poultry vaccination into prevention strategies should impact the way poultry are produced and traded in the future.

Agricultural policy in the field of innovation and digitalization of agricultural exports: legal framework

The article highlights the issues of the state agriculturalpolicyonthedevelopmentofinformation and innovative agricultural relations in the field of digitalization of agricultural exports (hereinafter - agroexport). The peculiarities of the pilot project on verification of agro-industrial complex entities under martial law are clarified. It is emphasized that the verification of agro-exporters is aimed at developing agrarian information and innovation relations, widespread use of digitalization in the agricultural sector, strengthening the rule of law and overcoming bureaucratic obstacles in all areas of agricultural production, and minimizing the corruption element in agricultural export relations. To be included in the list of verified agricultural entities, an entity must have a special legal personality, the elements of which are: the status of an agricultural producer; experience in exporting agricultural products; registration in the State Agrarian Register; financial stability; and systematic economic activity. The author determines that the State Agrarian Register is an intangible asset in the form of a complex digital object which combines a computer program and a non-original database. It is accounted for and administered by the state. Intellectual property rights to this Register belong to the state. The registration of entities in the State Agrarian Register creates a potential opportunity for agribusinesses to timely submit applications for state support, as well as permits, conduct their own verification as an agro-export entity, etc. The digitalization of such data is the basis for the opening of electronic agricultural markets, including digital agricultural exports. Given the potential of digital trade, the author argues that it is expedient to support the further filling and functioning of the State Agrarian Register and verification of agro-exporters as prerequisites for the further development of digital agrarian legal relations. It is emphasized that the digitalization of agricultural production is an additional factor for expanding the markets for national agricultural products. Thus, due to the introduction of digitalization into the production process, a future consumer of agricultural products (regardless of their location in the world) can potentially track the entire process - from the selection of high- quality seeds to finished products.

Development of the global competitiveness of Russian regions: the concept and configuration of the "smart" complementarity

Purpose: is to work out the scientifically sound theoretical and methodical framework for the «smart» complementarity of trade flows, aimed at selecting and substantiating potential commodity niches in trade of Russian regions with foreign countries.Methods: the general methodological basis of the study is the critical analysis of the scientific literature that forms the theoretical and methodological basis for the global competitiveness of individual regions of a country presented in the theories of regional and spatial economy. The study has been carried out by methods of system, structural-logical and abstract-logical analysis.Results: the research resulted in some fundamental scientific novelties such as: the scientifically grounded theoretical concept of “smart” complementarity, which makes it possible to identify the presence of specific foreign trade niches in a geographical (country, region) and commodity contexts, based on an analysis of the complementarity of trade flows at the level of a Russian region and a foreign country, and assessment of the global competitiveness of the regional economy, as well as “fine” criteria that determine the activity of participants in foreign economic activity. The applied results included a specific configuration of "smart" complementarity – the algorithm for determining promising economic specializations of the region, allowing to combine trade statistics of a foreign country with data regional statistics, indicating the presence of foreign trade potential, taking into account regional economic specializations. The developed algorithm is intended for the use in an information and analytical system to support management decisions in the field of foreign economic activity of the region.Conclusions and Relevance: the concept and configuration of «smart» complementarity in their practical implementation in the form of an information and analytical system are proposed in the article to provide the participants of foreign economic activity with data on promising export groups for selected countries in Asia, Africa and Latin America. This approach allows moving the «center of gravity» of building trade and economic relations with foreign countries from the federal to the regional level.

Demand Potential for Agricultural Trade between China and Countries along the "Belt and Road".

International agricultural markets are an important part of the global food resource chain. Tapping into the potential of agricultural trade between China and countries along the "Belt and Road" (B&R) is conducive to safeguarding China's and the world's food security, but there is less literature on the potential of bilateral trade demand. This paper ranks the B&R countries according to the scale of imports and exports, and calculates the elasticity of demand for imports, the elasticity of substitution for exports, and, finally, the potential of elasticity of demand for trade between China and the major B&R countries. The results show that China's agricultural export potential to major B&R countries is ranked as follows: Indonesia, Thailand, Russia, Poland, Turkey, Vietnam, Malaysia, Ukraine, India, and Singapore. The major B&R countries are also ranked in terms of their export potential to China: Vietnam, India, Ukraine, Russia, Malaysia, Thailand, Indonesia, Poland, Singapore, and Turkey. The findings of this paper provide a decision-making basis for promoting agricultural trade between China and B&R countries.

Potential for Cooperation between Russia and MERCOSUR under Sanctions

Under the pressure of the unprecedented economic sanctions, the Russian Federation faces the tasks of reformatting its foreign economic strategy, transforming its trade policy, changing supply chains, and expanding cooperation with the partners that maintain economic neutrality, particularly with the countries in Latin America, the Asia-Pacific region, and the Middle East. The purpose of this research is to determine to what extent economic sanctions can serve as a factor for activating trade and economic relations between Russia and the countries of MERCOSUR as the most significant potential partners from the Latin American region. The research question of the article is to what extent it is possible to sooth the impact of sanctions on the Russian economy by stimulating trade links with MERCOSUR countries. The article attempts to compare the relative significance of Brazil, Argentina, Uruguay, and Paraguay as trade and economic partners for Russia at the time of sanctions. The article identifies factors contributing to the growth of potential of mutual trade and economic cooperation and those constraining it; provides an assessment of the current development of trade and investment relations between the parties; calculates indicators to determine the possibility of substituting the lost markets for export-import operations by the new ones.

Analisis Perdagangan di Sulawesi Tenggara

Trade is one of the crucial elements in a country's economy, playing a vital role in supporting regional and national economic growth. Through trade, a region can meet its needs and distribute its production to other areas, both domestically and internationally. Southeast Sulawesi Province, as one of the regions on the island of Sulawesi, has great potential in trade, particularly in the agricultural and industrial sectors. This province has made a significant contribution to the country's foreign exchange reserves through export and import activities. This study aims to analyze the development of trade in Southeast Sulawesi Province, focusing on the export-import performance and the region's main commodities. The method used is descriptive, utilizing secondary data obtained from the Central Statistics Agency (BPS). The results show that in 2024, Southeast Sulawesi experienced a trade surplus, where the value of exports exceeded the value of imports. The largest surplus was recorded in January 2024, amounting to 256.38 million US dollars. Three major commodities contribute significantly to the province's trade, namely cloves with a transaction value of IDR 480.74 billion, cocoa at IDR 248.74 billion, and cashew nuts at IDR 230.75 billion. These three commodities not only serve as flagship products for the local economy but also have a positive impact on the national economy. The findings of this study suggest that with proper management, the trade potential of Southeast Sulawesi can continue to grow, contributing even more to Indonesia's overall economy.