Revealed Comparative Advantage Research Articles

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.

EUROPE UNION BAN ON PALM OIL: THE TREND OF PALM OIL COMPETITIVENESS AND THE CO-INTEGRATION ON THE SOYBEAN AND RAPESEED OIL

Palm oil highly demanded in global trade and expected to gain more demand in the future market. The primary concern regarding palm oil production is its environmental impact. The issue that is focused on in this study the European Union to promote the banning of oil palm in the world market in 2018 and the European parliament decided to ban palm oil for biofuel used. The Europe Union also promoted soybean and rapeseed as replacement for the banned of palm oil in Europe market. Therefore, this study aims for the effect toward the competitiveness using the Revealed Comparative Advantage (RCA) and Revealed Symmetrical Comparative Advantage (RSCA) indices among the major crude palm oil exporters especially within 1991 to 2020 period of years. Moreover, this study also clarified the Autoregressive Distributed Lag (ARDL) co-integration for the soybean and rapeseed oil toward the competitiveness for 2 largest palm oil exporters in the world from 1989 to 2021.

Analysis of Competitiveness and Export Performance: Indonesian Crude Palm Oil (HS 15111000) Commodity against Major Competitor in Indian Market

International trade has become a key pillar in driving a country's economic growth. The stability of international trade is reflected in export-import activities. The amount of exports that exceeds the amount of imports will increase national income and positively affect the country's economic growth. Crude Palm Oil (CPO) is Indonesia's dominant export product that plays a critical role in the country's economic growth. Indonesia's CPO production in 2018 was recorded at 40.57 million tons. India is Indonesia's largest main market in exporting CPO. The purpose of this study is to determine the competitiveness and performance of Indonesia's CPO exports compared to the main competitor countries, namely Malaysia and Thailand. The data analysis process utilizes Revealed Comparative Advantage (RCA), Constant Market Share (CMS), and the Man-Whitney Test with the period of research statistics from 2013-2022.The results show that Indonesia's RCA value has competitiveness and comparative advantage in CPO exports against Thailand, but does not show significant differences with Malaysia in the Indian market. The results of data analysis using Constant Market Shares (CMS) to measure Indonesia's CPO export performance through standard growth, commodity composition effects, market distribution effects and competitiveness effects show that the export performance of CPO commodities against major competitor countries in the Indian market tends to have a positive trend.

Price Distortions and Competitiveness of Cotton Production in Pakistan

The research is conducted to determine the cotton price distortions, as well as competitiveness at national and international levels. National competitiveness has been measured by using the nominal protection coefficient (NPC) and benefit-cost ratios for the period 2008-09 to 2018-19. To gauge international competitiveness, trade base indices under the revealed comparative advantage approach are used. A comparison of the international competitiveness of Pakistan with major cotton-exporting countries has also been made. The results of this research revealed that at the national level cotton producers in Pakistan faced implicit taxation for most of the years during the study period, as NPCi averaged at 0.87 as an import substitution crop. Export parity prices were slightly less or equal to the domestic prices by varying degrees as NPCe averaged at 1.06. The production cost grew at the rate of 12.3% per annum, while cotton output prices grew at the rate of 8.4 percent per annum. Consequently, a decrease was registered in the benefit-cost ratio during the study period. Pakistan has experienced comparative and competitive advantage for cotton as indicated by results of revealed comparative advantage (RCA) indices. A comparison of Pakistan’s indices with main exporters/competitors demonstrated that Pakistan has a relatively higher comparative and competitive advantage for cotton. However, Pakistan’s international competitiveness exhibited a declining pattern since 2011-12. This result is consistent with the national level scenarios as the benefit-cost ratio has declined over this period.  It can be concluded that productivity growth and a reduction in input costs are needed to improve overall competitiveness in cotton production and trade.

Analysis of Indonesian Cocoa's Competitiveness in the International Market

The cocoa commodity contributes the fourth highest national income after palm oil, rubber and coconut. The cocoa market has great potential as seen from the increase in world consumption, so Indonesia is expected to take advantage of the opportunities available. This study aims to analyze Indonesia's cocoa competitiveness in the international market with several countries that are the largest exporters of selected cocoa products in 2018-2022. The analysis methodology of this research measures the competitiveness of commodities in the global market using a mathematical framework. The analysis is used to process quantitative data. Revealed Comparative Advantage (RCA) is used to determine the competitiveness of Indonesian cocoa in the international market. Index of Trade Specialization (ISP) analysis was then conducted to determine the competitiveness position. The results of the RC? analysis show that Indonesia's competitiveness is strong for the commodities of cocoa paste, cocoa fat and cocoa powder, while the cocoa beans are still weak. The results of the ISP calculation for 2018-2022 show that Indonesia is an exporting country for k?k?o paste, k?k?o fat and k?k?o powder, while for k?k?o seeds Indonesia is an importer

Daya Saing Dan Komplementaritas Perdagangan Kayu Indonesia: Kasus Kawasan Asia-Pasifik

Indonesia trades ten groups of wood in the Asia-Pacific region. Many forest industry problems occur during trade. Competition and interdependence in trade are research objectives. The research secondary data source is taken from UN Comtrade 2011-2021 and analyzed using the Export Similarity Index (ESI), Revealed Comparative Advantage (RCA), Trade Complementarity Index (TCI), and Intra-Industry Trade (IIT) methods. The research results show that the wood export trade between Indonesia and competing countries competes weakly with each other in the six partner countries. Indonesia is competitive in the products SITC 245 (fuel wood (excluding wood waste) and wood charcoal), SITC 248 (wood, simply worked, and railway sleepers of wood), SITC 251 (pulp and waste paper), SITC 634 (veneers, plywood, particle board, and other wood, worked, n.e.s.), SITC 635 (wood manufactures, n.e.s.), and SITC 641 (paper and paperboard). On the other hand, Indonesia and partner countries almost complement each other as trading partners in terms of exports and imports of wood. However, the integration of Indonesian wood trade with partner countries is considered weak. Products SITC 248 (wood, simply worked, and railway sleepers of wood), SITC 251 (pulp and waste paper), SITC 641 (paper and paperboard), and SITC 642 (paper and paperboard, cut to size or shape, and articles of paper or paperboard) are several product industries that have led to intra-industry trade. Policy recommendations are to utilize resources optimally, develop the wood processing industry to produce finished wood products, and improve the quality and standards of wood products in accordance with policies in trade cooperation.

Competitiveness Analysis of Indonesian Coffee Exports to The European Union Market

Indonesia will be the fourth largest coffee-producing country in the world by 2020, after Brazil, Vietnam, and Colombia. Coffee is one of the plantation commodities that is starting to be in great demand by the people of Indonesia. There are many types of coffee in the world that have the best quality and quality. This makes certain types of coffee so popular and sought after by many coffee lovers worldwide. The purpose of this study is to determine the competitiveness of coffee exports in the European Union market. The data used in this study are secondary data processed and sourced from the trade map. The data analysis method used is Revealed Comparative Advantage (RCA) to analyze a country's competitiveness and Comparative Export Performance (CEP) to evaluate a country's export specialization in certain products. Based on the results of the analysis, Indonesia is still ranked fourth with an RCA value of 6.89, this is due to the low quality of coffee in Indonesia. It can be seen that Colombia has an RCA value of 57.02 in the EU market followed by Brazil whose value is 25.78, slightly different from Vietnam's RCA value of 25.54.

Analysis of Malaysia's Export Potential of Palm Oil and Its Products to RCEP Member Countries

This study explores the export potential of the Malaysian palm oil industry to RCEP (Regional Comprehensive Economic Partnership) member countries based on the regional economic framework. The panel data from 2018 to 2022 were analyzed using the Trade Gravity Model, RCA (Revealed Comparative Advantage), and TCI (Trade Complementarity Index) indices. The results categorize the fifteen RCEP member countries into three potential classes based on the type of potential. In addition, it was found that the trade complementarity of RCEP member countries showed a significant positive correlation with the export size of Malaysian palm oil and its products. The study provides insights into the trade pattern of palm oil in the region and provides a valuable reference for future trade policy formulation and industry development and provides a basis for research related to the sustainable development of the Malaysian palm oil industry.  

Down-Streaming Impact to the Competitiveness of Indonesia Cocoa

The objective of this paper is to provide qualitative and quantitative analysis on the competitiveness of Indonesia cocoa beans post down-streaming push by the Government of Indonesia. Indonesia cocoa has been part of the top three producers and exporters of global cocoa beans and had been shifting into cocoa processed products to create more value. Quantitative analysis from upstream perspective measures the supply concentration and competitive advantage using The Four-Firm Concentration (CR4), Herfindahl-Hirschman Index (HHI), and the model of Revealed Comparative Advantage (RCA) while value creation impacted by down-streaming is based on published data during the period of 2012-2021. The qualitative analysis uses the framework of Global Competitiveness Index to measure the competitiveness gap of Indonesia cocoa sector based on interview with Indonesia cocoa experts consisted of respected government officer, academic, researcher, cocoa trader association, and cocoa farmer association. The result concludes the domination of top four countries on supply side has shifted from “moderately concentrated” to “highly concentrated”; and confirms the improvement of Indonesia cocoa from value creation perspective by down-streaming the export product. Competitiveness gap analysis compares the current condition with ideal condition of industry; as a result, identify there are one area that in line with sectoral environment and three major areas that need to be resolved to close the competitiveness gap especially in the area of productivity and efficiency, institutional framework, and prices. Government should continue the capacity building program to improve smallholders’ capability and monitor the implementation of warehouse receipt program to ensure the partiality to cocoa smallholders.

Export Performance of Indonesian Processed Tuna Commodities in the Japanese Market

Tuna commodity is globally competitive, but its performance is still below its competitor country, namely Thailand and is starting to compete with other countries, namely the Philippines, Vietnam and China. This study aims to evaluate the competitiveness performance and analyze the demand for processed tuna commodities in the Japanese market. Export competitiveness analysis is processed using the Revealed Comparative Advantage (RCA) index and the Revealed Competitiveness Advantage (RC) index. The level of competition and export demand will be analyzed using the Almost Ideal Demand System (AIDS) model. The results showed that the export performance of Indonesian processed tuna commodities was comparatively and competitively competitive in the Japanese market. The demand for Indonesian processed tuna commodities in the Japanese market has fulfilled the demand theory. Indonesian processed tuna is a normal item for Japanese consumers. For Indonesia, processed tuna from competitor countries Thailand, the Philippines, Vietnam, and China are substitute goods. Thus, an increase in prices in these four countries will increase Indonesia's share.

DAYA SAING EKSPOR KOMODITAS TEMBAKAU INDONESIA SELAMA PANDEMI COVID-19

<em><span lang="EN-US">The excise contribution from the Tobacco Products Industry (IHT) in 2020 amounted to Rp170.24 trillion or 96.56% of all Indonesian excise revenue. The Covid-19 pandemic caused tobacco exports in 2020 to decrease by 6.41% or 2,134 tons. Based on these conditions, it is necessary to research the competitiveness of tobacco exports during the Covid-19 pandemic in the main destination countries. The method of determining the location used is a purposive method, namely in Belgium, Singapore, Dominican Republic, Sri Lanka, Germany, the Netherlands, and the United States. The data used is time series data for 38 months starting from August 2018 to September 2021. The analysis methods used are IIT (Intra Industry Trade), RCA (Revealed Comparative Advantage), and EPD (Export Product Dynamic). The results showed a) IIT analysis, that most countries experienced a decline during the Covid-19 pandemic. Countries that experienced a decrease were the Netherlands, Dominican Republic, Singapore, and Sri Lanka, while those that experienced an increase were Belgium, Germany, and the United States. b) RCA analysis in the seven main destination countries showed a strong position. c) EPD analysis of most of the main destination countries for tobacco exports showed positive results, except for the United States which experienced a decrease.</span></em>

Assessing Direction of India’s Exports: A Dynamic Framework

Decision on trade policies with emphasis on bilateral trade relationships needs knowledge about the direction of exports of the exporting country along with associated changes like degree of specialisation, etc. The direction of export for a product or sector can be taken as a set consisting of destination countries (DCs) and corresponding export potentiality. The set reflects the direction, composition and value of trade potentials and helps to decide export-boosting measures of several sectors, focusing on a country. The paper suggests the use of ratio and geometrically aggregated revealed comparative advantage (RCA) values for individual and combined sector growth (positive or negative), respectively. This approach overcomes the static properties of RCA and shift-share analysis typically used to reveal the patterns of trade direction. The pattern is investigated by geometric aggregation of ratios of RCA at the current period over the base period for each sector. The index follows log-normal distribution and shows fluctuations of RCA for a product/sector across time. Such curves of fluctuations for different countries may facilitate meaningful inter-country comparisons. Second, this paper suggests the use of bilateral RCA to determine the direction of India’s exports for a particular sector, enabling the determination of its potential markets. JEL Classification: F1, F4

THE TEXTILE INDUSTRY TRADE COMPETITIVENESS OF SELECTED EUROPEAN TRANSITION COUNTRIES

The paper analyses the textile industry trade competitiveness of nine European transition economies (Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Hungary, North Macedonia, Romania, Serbia and Slovenia), in parts and in its entirety, by using the following indicators: Revealed comparative advantage (RCA), Competitiveness growth index (RCA1), Index of net business performance (RCA2), and Michaely index (MI). The analysis focuses on the period between 1995 and 2018. The results of the analysis show that the textile industry of Northern Macedonia is internationally competitive, and that most countries have revealed comparative advantages. The textile industry contributed to the surplus in trade balance in North Macedonia, Bulgaria and Romania, while North Macedonia, Romania, Bulgaria, Croatia, Bosnia and Herzegovina and Serbia achieved some level of production specialisation. It was also confirmed that these countries had statistically different levels of trade competitiveness. The top level of production finalisation accounted for the greatest average value of competitiveness indicators. 

<p>The Contribution of Each Brazilian Estate to the Competitiveness of the Country’s Wheat Exports (1999-2022)</p>

The objective of this study is to measure the competitiveness of Brazilian wheat exporting states through the application of the performance matrix of Farias and Farias (2018), which is based on the Revealed Comparative Advantage (RCA) and the Relative Position (RPI) indexes. The main results obtained reveal that the country is not self-sufficient in wheat production, nor does it stand out in exports, needing to import large quantities of wheat to meet domestic demand. Among the producing states, São Paulo was the only one to present Revealed Comparative Advantages, and external potential. On the other hand, the Southern states (Paraná, Rio Grande do Sul, and Santa Catarina) do not have Revealed Comparative Advantages, but they are efficient in the commercialization of wheat to the international market, which indicates that these locations have internal potential to improve their competitiveness in this sector.

Analysis of Indonesia coffee exports competitiveness in the United States and Japan to promote sustainable market

Coffee is one of the main export commodity in Indonesia which has contributed to the foreign exchange. Indonesia is the fourth largest coffee producer in the world after Brazil, Vietnam and Colombia. The aim of this research was to analyze the level of competitiveness of Indonesian coffee exports to the United States and Japan markets. Data sources were obtained from the Indonesian Central Statistics Agency (BPS), UN Comtrade and Trade MAP. The data used is secondary time series data over a period of 5 years (2018-2022). The research method used Revealed Comparative Advantage (RCA) to calculate the level of competitiveness of Indonesian coffee exports to the United States and Japan markets. The research results showed that Indonesian coffee has a stronger competitiveness in the United States market compared to the Japanese market. However, when compared with Colombia, Brazil and Guantemala, the value of Indonesian RCA in the United States and Japanese markets is still far behind. Therefore, it is necessary to increase the production for sustainable coffee exports in the United States and Japan markets.

A Review on China's Exports and Crowding-Out Effects

Export-led growth strategies have become the main paradigm for developing countries seeking to achieve higher economic growth. While exports are key to generating income, there are concerns regarding limitations in external demand. Specifically, China’s remarkable export performance has been at the center of debates that revolve around possible export displacement effects on other countries. This study reviews this literature on export-led growth and crowding-out effects induced by China’s growing exports on various countries and regions. Moreover, reflecting dynamic changes in export structure, lists of key products for Chinese exports are provided. While using the 4-digit level Harmonized System (HS) classification, the selection of the products is based on improvements in revealed comparative advantage (RCA) over the period from 2009 to 2018 and is specific to China’s top three sectors with the largest global market shares: textile, electronics and machinery. Additionally, lists of competitor, potential competitor and potential loser countries are identified in the markets for these specified key products. The findings demonstrate increased competitive pressures on more advanced countries in connection with the increased sophistication of Chinese exports.

ANALISIS PEST : KAJIAN PADA CRUDE PALM OIL INDONESIA

Palm Oil is an important commodity and has a strategic role in the Indonesian economy. Palm oil derivative products have a good prospect. The utilization of palm oil is widely used as a basic ingredient of medicines and healthcare industry. The previous research showed Revealed Comparative Advantage (RCA) index of palm oil Indonesia above 1. RCA> 1 indicates this product has competitiveness, but it’s still needs to be improved. This study analyzes the condition of macro environment that influences the development of palm oil derivative products. Politic, Economics, Social, and Technology (PEST) analysis can provide a broad picture of the influence of external factors that are important for palm oil. The PEST analysis results show that political, economic, and social impacts have a high impact on the palm oil industry, while technology has a moderate impact. The high impact of the economic and social conditions on macro environment are some great opportunities for further development. Seeing this, it is necessary to concentrate on one major segment and sharpen its as a strategy.

Competitiveness and Export Position of Indonesian Whole Nuts Seeds in the International Market for the Period 2011-2022

Indonesia is the largest nutmeg exporter in the world. Indonesian nutmeg tends to experience an increase in export volume every year. However, the development of nutmeg exports is still experiencing fluctuations during the 2011–2022 period. This research aims to analyse the export competitiveness of Indonesian whole nutmeg seeds in the international market and the competitive position of whole nutmeg seeds in export destination countries in the period 2011–2022. This research uses secondary data, namely in the form of time series data for 12 years, namely the years 2011–2022. The data were analysed using revealed comparative advantage (RCA) and dynamic revealed comparative advantage (DRCA) analyses. Research results using Revealed Comparative Advantage (RCA) show that Indonesian whole nutmeg seeds are competitive in the international market. Indonesian nutmeg in ten export destination countries is also competitive, with the highest competitiveness of whole nutmeg in Germany, Italy, and the Netherlands. Based on the Dynamic Revealed Comparative Advantage (DRCA) analysis, the results show that product competitiveness growth is always positive in Japan, leading to Japan's competitive position becoming a rising star in the fourth period (2020–2022).

Daya Saing Ekspor Ikan Tuna Indonesia di Pasar Global

Revealed Comparative Advantage (RCA) analysis is a key tool in assessing a country's competitiveness compared to others. This study uses RCA to measure Indonesia's comparative advantage in the global tuna market. The calculated RCA values show Indonesia's superiority in tuna production and exports, especially with a focus on fresh or chilled yellowfin tuna (Thunnus albacares) with HS Code 030232. The RCA values for Indonesia, Panama, the Philippines and the Netherlands are 200, 150, 50, 350, and 400, respectively. These results confirm that Indonesia has a comparative advantage in the international tuna market, which is supported by abundant natural resources, a large fishing workforce, and a history of successful tuna exports. Despite this, challenges remain, including overfishing, the impacts of climate change, and illegal, unreported, and unregulated (IUU) fishing. The decline in tuna production in Indonesia demands better fisheries management and international cooperation to address unsustainable practices. The Indonesian government's commitment to conservation is visible in the Tuna, Skipjack and Tuna Fisheries Management Plan. Overall, Indonesia's vibrant tuna export industry, supported by extensive marine resources, a large international market and robust infrastructure, shows significant potential. The government's commitment, combined with ongoing efforts to increase competitiveness through increased productivity, product quality, diversification and global promotion, positions Indonesia to strengthen its role as a major player in the global tuna export market. 

New Challenges and Opportunities of Indonesian Crude Palm Oil in International Trade

Indonesia is one of the largest palm oil producers in the world. The palm oil industry must look at the market competition map, starting from competing countries and other export opportunities to absorb palm oil products to increase state revenues. This paper analyzes the new challenges and opportunities for Crude Palm Oil (CPO) in Indonesia in international trade. Analytical tools were Revealed Comparative Advantage (RCA), Revealed Symmetric Comparative Advantage (RSCA), Dynamic Product Export and X-model Potential Export. The results showed that Indonesian and Malaysian palm oil commodities obtained an RCA value of more than 1 and an RSCA value of close to 1. Indonesia is more competitive than Malaysia. The X-model showed that Indonesian CPO market share optimism is only in India and the rest is less potent. Malaysian CPO market share also has less potential. Therefore, Indonesia’s new challenges are export tariffs, obstructed access, insufficient downstream production and a black campaign. The opportunity for participation in the CPO export market is only in India compared to Malaysia, which has less potential. The two countries have less potential in destinations such as the Netherlands, USA, China and Kenya. Indonesia can take external policies by establishing cooperation with export destination countries, such as trade agreements, so that information about Indonesian palm oil is well received. Meanwhile, internal policies strengthen domestic downstream industry policies, such as the food, health, and renewable energy industries, to strengthen the domestic economy and improve the welfare of Indonesian palm oil farmers.