Taiwan's Exports Research Articles

Komoditas Dalam Skema Request - Offer Indonesia Dengan Taiwan: Analisis Inferensia Berdasarkan Database Tahun 2019

Bilateral cooperation between Indonesia and Taiwan has better growth every year, while import tariffs imposed by Taiwan on Indonesia export commodities are still relatively high. This study aims to identify and analyze commodities included in the request-offer scheme between Indonesia and Taiwan based on 2019 database. Identification and analysis of annual growth value, equivalent ad valorem tariff, average export value, export share, average Revealed Comparative Advantage (RCA) index, and RCA trend are carried out through inferential analysis. Inferential analysis is needed to determine the commodities contained in the request-offer scheme of Indonesia and Taiwan that have good performance but are still subject to high import tariffs by their partner countries. Indonesia's export commodities to Taiwan which have a good performance while the import tariffs are still high are given by Taiwan to Indonesia as Indonesia's request scheme to Taiwan, namely: processed food (ofd); tobacco (b_t); vegetables, fruits, and nuts (v_f); and fishery commodities (fsh). Taiwan export commodities to Indonesia that have good performance but are still subject to high import tariffs by Indonesia are Indonesia's offer scheme to Taiwan, namely: manufacturing (lum); cosmetics (crp); miscellaneous edible preparations (ofd); and textiles (tex). Indonesia and Taiwan can increase bilateral cooperation in the field of international trade through barriers lowering schemes and transferring science and technology from each country.

The Market Response to the United States COVID-19 in Taiwan’s PCB and Network Communication Industries

This study investigates how COVID-19 in the United States affects the stock prices of the Taiwanese printed circuit board (PCB) and network communication industries. We utilize the event study method to evaluate the market response to the announcements of the United States COVID-19 and the sample period is from February 2020 to April 2020. This study examines whether the COVID-19 caused stock price variations and generated abnormal returns for Taiwanese companies. Finally, this study also evaluates whether there is a significant difference in abnormal returns among companies who have reported corporate social responsibility (CSR) and companies who have not. This study finds that the United States prevention policies have caused a significant influence on abnormal returns in Taiwan’s PCB and network communication industries. Because Taiwan exports PCB to the United States, the stocks price decrease to the United States COVID-19 due to the investors’ expectation of the substantial order decline from the United States in in Taiwan’s PCB and network communication industries. We use ANOVA to prove the difference among the abnormal returns generated by the first, second and third U.S. COVID-19 announcements. The empirical results show that the first announcement caused the largest reactions, and the third announcement caused the least. Furthermore, the United States government’s social distancing policy has caused positive abnormal returns for Taiwan’s PCB and network communication industries due to the great demand for online meeting. Furthermore, we find the significant difference between the implementation and loosening of the social distancing polices. This suggests that investors regard the loosening of the United States social distancing policy signal that the order decline in Taiwan’s PCB and network communication industries. There is no significant difference between the abnormal returns of companies that have reported their CSR practices and that of companies that have not reported.

Asymmetric Effects of Exchange Rate Volatility on Taiwan-China Trade: A Non-Linear ARDL Analysis of 20 Industries

Abstract This study investigates the long-run and short-run effects of exchange rate volatility on Taiwan's exports to and imports from China across 20 industries, employing a non-linear autoregressive distributed lag (NARDL) approach. The analysis covers the period from January 2004 to December 2022 and highlights industry-specific sensitivities and asymmetric impacts of exchange rate fluctuations. Our findings reveal the critical role of exchange rate volatility in shaping export and import performance across industries, with both positive and negative shocks exerting significant short-run and long-run effects. Asymmetric impacts of exchange rate fluctuations affect 87.96% of Taiwan's total exports to China in the long run and 72.11% in the short run. In contrast, the asymmetric impacts on imports influence 77.12% of Taiwan's total imports from China in the long run and 13.21% in the short run, demonstrating varying sensitivity across industries. These findings accentuate the necessity for industry-tailored trade policies and strategic considerations to better manage the risks and opportunities presented by exchange rate volatility in cross-strait trade. JEL classification numbers: F14, F31, C22. Keywords: Exchange rate volatility, Taiwan-China trade, Non-linear ARDL, Asymmetric effects.

The Substitution Effect of US‐China Trade War on Taiwanese Trade

Using monthly trade data from January 2018 to December 2019, we empirically examine the effects of the US‐China trade war on Taiwan's exports as well as imports. On the export side, the tariff hike in the US against imports from China may increase Taiwan's exports to the US, (i.e., the substitution effect). To investigate this hypothesis, we examine how US tariffs on goods from China affect Taiwan's exports to the US. More directly, we also explore how China's exports to the US change Taiwanese exports to the US. On the import side, decline of China's export to the US may boost Taiwan's export while increasing its demand on Chinese intermediate inputs. Our empirical analyses confirmed the validity of these hypotheses. By contrast, we did not find a substitution effect in exports from neighboring countries—that is, Japan and South Korea.

Trade options for a small open economy: The different impact of Taiwan exports to China and to other countries

This study aims to explore advantageous trade arrangements for a small open economy. To discover the arrangement, the fundamental question to ask is how trade affects a small economy. Due to the differential factor mobility, the two main streams of trade theory—new economic geography and comparative advantage—make divergent predictions of trade effects. This study identifies the differences in factor mobility and distinguishes the differential impacts of exports to China and other countries on Taiwan’s manufacturing clusters. Using Taiwan’s 2006 and 2011 census data and trade statistics, this study applies the two-stage least squares method to test the differential impacts. The findings reveal that the growth in Taiwan’s exports to other countries significantly increased the employment level of manufacturing clusters in Taiwan. However, such effects have not been found for exports to China. The lack of response in Taiwan’s local employment to exports to China can be inferred as a short-term exhibition of the long-run core-periphery effect. The policy implication of this study is that trade involving low factor mobility is more beneficial than that involving high factor mobility for a small open economy. Thus, for a small economy, trade liberalization that will ‘not’ attract large factor outflows from the small economy is more desirable.

Unveiling the true value of across-strait trade: The global value chain approach

Due to the pervasive nature of value chains, an increasing amount of imported intermediate components and raw materials from other countries are entangled in Taiwan's exports to Mainland China. This circumstance leads to odd across-trait bilateral trade amounts and surpluses favorable towards Taiwan. The purposes of this paper are applying Johnson and Noguera (2012) to extricate value-added exports earned by Taiwan from China and Wang, Wei, and Zhu (2013) to decompose Taiwan's gross exports to China into various meaningful components. The two issues are related to trade in value added and value added in trade. Specifically, the former explores the value added embedded in the source country's exports to the absorbing country as final demand, regardless of whether those goods are directly or indirectly arriving at the absorbing country. The latter only looks where the value added is originated regardless of where it is ultimately absorbed. We show both concepts aim to measure a country's value added from its trades, but from different angles. Each has its own distinct meaning. They are related, but not completely the same.The inter-country input–output (ICIO) table used in this paper comes from the World Input–Output Database (WIOD) (Timmer et al., 2015 and Dietzenbacher et al., 2013). Empirical results indicate that Taiwan's export values to Mainland China shrink by 64.3% when bilateral trades are measured in value-added terms. Furthermore, Taiwan's trade surplus toward China also decreases by 65.2% under this measure. From the viewpoint of value added in trade, the share of value added in Taiwan's gross exports to China continued to decrease and reached 50.9% in 2011, while the components of foreign value added and double counted terms kept growing in recent years.

Taiwan and Regional Trade Organizations: An Urgent Need for Fresh Ideas

This essay provides an overall assessment of Taiwan's prospects for joining the Trans-Pacific Partnership (TPP) and recommends a series of potential options for how Taiwan can overcome the challenges related to gaining membership. The first section offers a brief overview of regional trade architecture in the Asia-Pacific region and Taiwan's place within that architecture. The second section details the challenges Taiwan faces in joining the TPP, both domestically and externally. The third and fourth sections describe the implications of Taiwan joining or being excluded from the TPP for cross-strait relations and U.S.-Taiwan relations, respectively. The essay concludes by identifying a path forward for Taiwan and offering policy recommendations that the island's leaders can use in their arguments that joining the TPP is in Taiwan's best interests.UNDERSTANDING THE ASIA-PACIFIC'S TRADE ARCHITECTURE AND TAIWAN'S TRADE RELATIONSThe Asia-Pacific's Trade ArchitectureAsian regional trade agreements-twelve and counting-range in scope from the world's most far-reaching trade agreement (the Australia-New Zealand Closer Economic Relations Trade Agreement) to narrower preferential deals (such as the Asia-Pacific Trade Agreement). The Asia-Pacific is also one of the most prolific regions when it comes to free trade agreements (FTA). Yet some have characterized these agreements as a noodle bowl of commitments and called into question their tangible benefits due to the effects of overlapping regulations and trade diversion.1There is debate about whether the proliferation of regional agreements has contributed to the inability to make progress on multilateral trade liberalization, especially as the Doha Round agenda recedes to a vanishing point.2 Concerns about the expansion of FTAs focus on the potential to undermine existing multilateral trade agreements. But the truth is that the companies most interested in open trade and investment regimes are indifferent about the package in which such benefits are delivered. The trend in the Asia-Pacific is clear: regional trade agreements are here to stay. The sooner nations and businesses accept this fact and adjust accordingly, the better offthey will be at maintaining competitiveness.The Association for Southeast Asian Nations (ASEAN) has signed FTAs with several Asian nations and has begun negotiations with China, Japan, South Korea, India, Australia, and New Zealand to form the Regional Comprehensive Economic Partnership (RCEP).3 While some in Taiwan-including President Ma Ying-jeou-have called for the island's participation in the RCEP,4 the reality is that it favors states that already have FTAs with ASEAN, putting Taiwan at a disadvantage. However, the TPP is more encompassing than the RCEP, and if Taiwan were to join the TPP, the impact of its exclusion from the RCEP would be lessened.A number of FTAs have emerged elsewhere in the Asia-Pacific, with the Korea-U.S. (KORUS) FTA being the most consequential for Taiwan. South Korea and Taiwan are major competitors in certain technology products, such as smartphones, but Taiwan's advantage has relied mostly on building factories in mainland China where it could find cheap labor. In recent years, that advantage has diminished because of South Korea's ability to create global brands and sign FTAs. The KORUS FTA, which was signed in June 2007 and implemented in 2012, has cut tariffs, expanded market access for services, improved regulatory transparency, streamlined the movement of goods, and strengthened intellectual property protection.5 South Korea has also signed FTAs with the European Union and China. In 2014, Taiwan's Ministry of Economic Affairs warned that once the FTA between South Korea and mainland China goes into effect, approximately one-fourth of Taiwan's export orders from the mainland may be diverted to South Korea.6 In addition, China, Japan, and South Korea have been working toward a trilateral FTA since 2012. …

Taiwan's Economy: An Economic Recession in the Making

Taiwan experienced a sharp deceleration in economic growth in the second quarter of 2015. If Taiwan's exports continue to deteriorate, Taiwan would have to struggle to maintain a one per cent growth rate. Taiwan's economic conundrums mainly lie with its deteriorating industrial structure. Without deepening industrial structural upgrades and reforms in the information and communications technology sector in particular, Taiwan will lose its international competitive advantage.

The effect of outward foreign direct investment on home country's export: A case study on Taiwan, 1989–2006

The purpose of this study is to examine the effect of outward foreign direct investment (FDI) on home country's export in Taiwan since the late 1980s. By pooling the time series and cross-section data in a modified gravity model, the study analyzes the effect of outward FDI, both country by country and host groups as a whole, on Taiwan's exports. It is concluded that outward FDI has a complementary effect on home country's export in Taiwan, most significantly evidenced in China-bound investment, which accounted for most FDIs after the 1990s.

A comparison of ARIMA forecasting and heuristic modelling

The study compares the application of the forecasting methods Autoregressive Integrated Moving Average (ARIMA) time series model and fuzzy time series by heuristic models on the amount of Taiwan export. When our model prolongs the sample period, the predicted error is smaller for the ARIMA model than for the heuristic model. Moreover, the predicted trajectory of the ARIMA model is much closer to the realistic trend than the heuristic model. Thus, the ARIMA model can forecast the export amount more accurately than the heuristic models. In the economic viewpoints, the amount of Taiwan exports is mainly attributable to external factors. In addition, the impact reduces with time and the export with lags 12 or 13 do not affect current export amount anymore. If the sample period is shorter, the heuristic models outperform ARIMA models. A heuristic fuzzy time series model can be utilized to predict export values accurately, when only small set of data is available.

The ECFA and its expected effect on cross-strait trade and investment: a Taiwanese perspective

To come to terms with the realization of ASEAN+1, Taiwan had concluded with mainland China a special free trade agreement (FTA), the Economic Cooperation Framework Agreement (ECFA) in June 2010. This framework agreement provides an early harvest agreement of near-term tariff elimination, including detailed product schedules for goods and services from each side, with the final shape of fuller trade liberalization in goods and services taking years to negotiate and realize. The conclusion of the ECFA has been considered as a major breakthrough in cross-strait talks and economic relationships, even though it is by no means free from controversies inside Taiwan. The authors are therefore motivated by hot debates in Taiwan to reflect on the expected trade effect of the ECFA by taking into account the factor of cross-strait global production networks. In particular, we examine with a proposed model and statistical robustness, the trend of Taiwan-based firms' localization in mainland China, driven in part by constant movements in global production networks, which generates complicated and dynamic relationships between Taiwan's investment-induced trade and structural shift in Taiwan's exports to mainland China. Based on our empirical findings, we reflect on the conventional views on the trade effect of the free trade agreement. The results of our analyses tend to support a cautious view about the trade effect of the ECFA. Without denying the significance of the ECFA and deepening cross-strait economic relationships, we argue that the impact of the ECFA should be interpreted in a wider context than just the trade perspective, as the conventional wisdom and the existing evaluations suggested.

A comparison study between fuzzy time series model and ARIMA model for forecasting Taiwan export

This study compares the application of two forecasting methods on the amount of Taiwan export, the ARIMA time series method and the fuzzy time series method. Models discussed for the fuzzy time series method include the Factor models, the Heuristic models, and the Markov model. When the sample period is prolong in our models, the ARIMA model shows smaller than predicted error and closer predicted trajectory to the realistic trend than those of the fuzzy model, resulted in more accurate forecasts of the export amount in the ARIMA model. Especially, the coefficient of the error term for the previous period has increased to 79%, implying the influential effect of external factors. These external factors attribute to the export amount of Taiwan according to the economic viewpoints. However, this impact reduces as time progressing and the export amount of the lag period of 12 or 13 do not affect current export amount anymore. In conclusion, when the sample period is shorter with only a small set of data available, the fuzzy time series models can be utilized to predict export values accurately, outperforming the ARIMA model.

Market power and import bans: the case of Japanese pork imports

Animal disease outbreaks trigger import restrictions that penalize exporting countries where the outbreak originates. However, significant increases in sales for the remaining exporters are likely to be observed only once the importer is confident that the outbreak is localized and contained. In March of 1997, Japan imposed an import ban on Taiwanese pork. At the time, Taiwan was supplying 41% of Japan's pork imports. The authors rely on the framework developed by Goldberg and Knetter (1999) and implement a generalized method of moments procedure to estimate the inverse residual demand elasticities of the current three largest exporting countries: United States, Canada, and Denmark. Structural change was investigated by adapting Qu and Perron's (2007) methodology that endogenizes the break dates. The authors found that foreign exporters were delayed by 2 years in making adjustments after Taiwan's exit. The ban on Taiwan's exports made the U.S. residual demand more inelastic and reinforced the case for U.S. market power. Denmark's reduction of market power may be due to their export product mix. [EconLit citations: L11; Q13]. © 2010 Wiley Periodicals, Inc.

Shifting From the Home to the Market: Accounting for Women's Work in Taiwan, 1965-1995

If one accounts for the shift of women's work from the household to the market during the course of economic development, what does the trajectory of growth and structural change look like? In this paper, I present an accounting of one such shift by looking at the role of women in Taiwanese growth between 1965 and 1995, a thirty-year stretch when an enviable per capita market growth rate of 6.9 percent was accompanied by large increases in female labor force participation. I develop an alternative measure of economic production that accounts for both market and household production in the form of unpaid domestic services provided by women in the home, reevaluating growth over the course of Taiwan's export boom. I find that social services, a category that includes services provided in the market and the home, was the lead employer of Taiwanese labor between 1965 and 1995. Another key finding is that many of the factors driving growth in the market sector also shape growth in the household sector. Despite trend declines in the relative size of the household sector, it has probably continued to grow throughout this period, primarily because of productivity gains in household production and the effects of demographic change. At the core of this conclusion is the assumption that opportunity wages are a fair measure of the monetary value of women's work in the home.

Taiwan, Hong Kong, and the Pacific, 1895–1945

AbstractFor the history connecting East Asia with the West, there is much literature about contact and trade across the Atlantic Ocean from the sixteenth to the early nineteenth centuries.1 This paper notes the rapid growth of the Pacific Ocean in linking Asia with the larger world in the early twentieth century by perceiving the economic relationships between Taiwan and Hong Kong while Japan colonized Taiwan. The Pacific route from Taiwan directly to America or through Japan largely replaced the Hong Kong–Atlantic–Europe–USA route to move Taiwan's export products to countries in the West. Other than still using Hong Kong as a trans-shipping point to connect with the world, Japan utilized Taiwan as a trans-shipping point to sell Japanese products to South China, and Taiwan's tea was sold directly to Southeast Asia rather than going through Hong Kong. Taiwan's exports to Japan took the place of its exports to China. Japanese and American goods dominated over European goods or Chinese goods from Hong Kong for Taiwan's import. Japanese and Taiwanese merchants (including some anti-Japanese merchants) overrode the British and Chinese merchants in Hong Kong to carry on the Taiwan–Hong Kong trade. America's westward expansion towards the Pacific, the rise of the Pacific shipping marked by the opening of the Panama Canal in 1914, and the rise of Japan relative to China, restructured intra-Asian relations and those between Asia and the rest of the world.

DO INTELLECTUAL PROPERTY RIGHTS MATTER TO TAIWAN'S EXPORTS? A DYNAMIC PANEL APPROACH

AbstractThis article analyses whether and how Taiwan's exports are sensitive to national differences in intellectual property right (IPR) protection, as well as the degree of imitation threat. Applying a longitudinal IPR index developed by the World Economic Forum (WEF) and using the generalized method of moments dynamic panel data modelling technique to control for endogeneity and panel unit root problems, the empirical results show that the strength of importing countries' IPR protection has a positive impact on Taiwan's exports, supporting the standpoint of market expansion that stronger IPR protection will induce more trade. Under various classification systems to differentiate the degree of threat of imitation across countries, both positive and negative export effects of IPR are found in Taiwan's case. However, the pattern of threat of imitation–trade nexus seems to contradict theory predictions. Moreover, high‐tech exports are found be more IPR sensitive than non‐high‐tech exports.

Application of fuzzy time series models for forecasting the amount of Taiwan export

The study proposed Traditional Time Series Method (ARIMA model and Vector ARMA model) and Fuzzy Time Series Method (Two-factor model, Heuristic model, and Markov model) for the forecasting problem. The real world case of Taiwan exports is employed for models’ test to compare the forecasting ability among models and to examine the effects of different lengths of interval and increment information on the forecasting error of models. The results indicate that Fuzzy Time Series Method performs better forecasting ability in short-term period prediction, especially Heuristic model. The ARIMA model generates smaller forecasting errors in longer experiment time period. Nevertheless, introducing increment information is not necessarily in improving the forecasting ability of fuzzy time series. As a result, it is more convenient to use the fuzzy time series method in the limited information and urgent decision-making circumstance.

Asia in 2008

In Asia as around the world, 2008 was a challenging year. On the one hand, it teemed with disasters, both man-made and natural, amid growing apprehension as the shock-waves of the American fi nancial tsunami ricocheted throughout the region. On the other, guarded hope for renewal was inspired (for some) by the arrival of new political leadership. What promises to be the most severe fi nancial crash since the 1930s struck Wall Street in the summer and fall of 2008. It is consensually attributed to a series of American policy blunders, chiefl y excessive monetary expansion plus big fi scal defi cits during the recovery from the 2000–01 high-tech crash and a lax regulatory regime, all of which infl ated a big asset bubble, particularly in the mortgage market. Despite initial hopes for a “decoupling” from globalism, meaning the fi nancially remiss Western economies might sink while letting the rest sustain their momentum behind new growth locomotives, that outcome appears increasingly unlikely. Slackening demand in the world’s biggest and most lucrative consumer markets has clearly made a difference, particularly to those economies whose growth relied on exports (e.g., China, whose export sector produces ca. 40% of GDP). Stock prices have plunged in Asia more than in any other region, and there has also been greater depreciation against the U.S. dollar (the Korean won dropped 35.4%, the Indian rupee 20.5%). Japan experienced a 26.7% drop in exports in November, Thailand 18.6%, while Korea and Taiwan exports in December sank 17% and 42% year-on-year, respectively (even China had an unprecedented 2.2% fall). Although there is little chance of a liquidity crunch because of the amassing of foreign exchange reserves since the 1997–99 Asian fi nancial crisis, declining export demand means rising unemployment in the short

The Substitution among the Exports of Taiwan, China, and Other Countries to the United States

The substitution among the exports of countries is a major phenomenon and foundation of the fast-changing global economy. However, the econometric method using aggregate data can usually estimate the extent of substitution only several years after the substitution has happened. This paper designed a detailed market share (DMS) analysis method that uses detailed trade data to document the actual replacement among the exports of different countries. The DMS indicators can measure the replacement that happened in every product or product group for every year. Therefore, DMS indicators can also be used as variables in further econometric research. This paper employed indicators to analyze the exports of Taiwan and China to the United States during 1990 and 2006. We found that the proportion of Taiwan's exports to the United States that was replaced by China during this period was about 71 percent to 85 percent. Taiwan, Japan, and other developed countries were the major sources of China's export growth. China also replaced a great part of developing countries' exports. China has also started to replace the high-end products of advanced countries. We found that 63 percent, 60 percent, and 33 percent of the highly human capital—intensive exports from Taiwan, Korea, and Japan, respectively, have been replaced by China. Most of these replacements happened in high-end products after 2000. Therefore, more products from advanced countries will be replaced by China in the near future.

A case study: The prediction of Taiwan’s export of polyester fiber using small-data-set learning methods

During the past four decades, the textile industry has been the industry earning the largest amount of foreign exchange in Taiwan. Notably, polyester fibers are one of the most outstanding industries in Taiwan on the global economic stage. The productivity of the polyester fiber industry in Taiwan has remained steady since the 1980s, and the midstream and downstream industry is also tied in with this development. However, starting from 2000, Taiwan's export of polyester fibers has changed dramatically owing to the rapid economic rise of China. Since this sudden change occurred only 5 years ago, it is hard for researchers to predict the amount of future exports accurately using the trends of historical data over the past 20 years. This research adopts the methodology GIKDE (General Intervalized Kernel Density Estimator), which is a newly developed method for small-data-set prediction, to predict the amount of future exports and expects to obtain a more accurate estimation to use as a reference to help managers make plans for products, capacity and markets.