Trade Performance Research Articles

Spicing Up India’s Economy with Trade Performance of King and Queen of Spices

Spicing Up India’s Economy with Trade Performance of King and Queen of Spices

J-Curve For Indonesia’s Trade Balance with Non-Linier ARDL

The performance of Indonesia’s Balance of Payments (BOP), especially for the trade balance/current account, which recorded a surplus and adequate foreign exchange reserves, controlled political conditions, and attractive yields, can impact the exchange rate. This improvement in the exchange rate further encouraged the entry of foreign investors, which caused the Indonesian economy to continue to grow when the world experienced a financial crisis. This study analyzes asymmetric models to prove the Marshall Lerner Condition of Indonesia with trading partners. Using NARDL methods, this study uses monthly data from 2005 to 2021 from the International Federal Reserve (IFS), a data source for foreign trade activities. The result of this study is a J curve in Indonesia’s trade pattern with its trading partners, formed in the United States, Singapore, Vietnam, and Japan. For the nonlinear ARDL method, the J curve is formed in trading partners Netherlands, Germany, Korea, Singapore, United Kingdom, Vietnam, and Japan. The implementation of Indonesia’s exchange rate policy should be followed by a policy that can suppress the exchange rate against inflation because if this policy is not followed, it will not significantly impact Indonesia’s trade performance in the long run.

ANALYZING THE IMPACT OF FREIGHT TRANSPORT, GDP, AND PESO – BAHT EXCHANGE RATE ON PHILIPPINE TRADE IN DESICCATED COCONUT USING THE GRAVITY MODEL OF INTERNATIONAL TRADE

Objective: The objective of this study is to investigate the impact of freight transport, Gross Domestic Product (GDP), and the Peso-Baht exchange rate on the trade of desiccated coconut between the Philippines and Thailand, utilizing the Gravity Model of International Trade. The primary aim is to understand the significant factors influencing the trade flow and to identify areas for improvement in international competitiveness. Theoretical Framework: The research is grounded in international trade theories, focusing on the Gravity Model, which emphasizes the roles of economic mass and geographical distance in determining trade flows. Method: This study made use of the ADF - Unit Root Test, Durbin – Watson Test, Jarque – Bera Test, Variance Inflationary Factor (VIF), Chow Breakpoint Test, Ramsey’s RESET, and Johansen Cointegration, to test the relationship between variables. Results and Discussion: The results of this study highlights the positive, yet insignificant effect of Thailand, and Philippines’ GDP on the trade in desiccated coconut. The exchange rate, and freight transport negatively impacts the trade, however, it is notable that only freight transport having a significant effect. Research Implications: The study provides insights into the logistical and economic challenges in the desiccated coconut trade, suggesting that addressing transportation inefficiencies and stabilizing exchange rates could enhance trade performance. Originality/Value: This study contributes to the literature by applying an innovative approach to desiccated coconut, revealing how logistical inefficiencies and economic variables affect trade flows and influence policy decisions. This research aids in enhancing trade efficiency between agricultural-exporting nations like the Philippines and Thailand.

Inventory Management and Firm Performance in Wholesale and Retail Trade

Inventory Management and Firm Performance in Wholesale and Retail Trade

Assessing Indonesian Nutmeg Commodity Trade Competitiveness and Developing Sustainable Strategies in the Global Market

Nutmeg encounters challenges in productivity, quality, climate change, Covid-19 disruptions, and stagflation, requiring efforts to enhance competitiveness and meet global market demands. This study aims to analyze Indonesian nutmeg trade performance, assess competitive advantage, and formulate essential strategies to increase its competitiveness. Using comprehensive mixed quantitative and qualitative analysis, methods include export-import market share analysis, CAGR, import dependency ratio, import-to-export ratio, RCA, RSCA, RTA, and SWOT/QSPM analysis. The data obtained from in-depth interviews with key stakeholders was used for formulating strategies enhancing nutmeg’s competitiveness. The findings underscore Indonesia's significant dominance in the global nutmeg market, with a considerable 61.6% market share but its export growth rate for nutmeg was less than the import annual growth. The competitiveness indicators demonstrated a robust comparative advantage of Indonesian nutmeg trade in the global market, especially for products categorized as “nutmeg, neither crushed nor ground” and “nutmeg, crushed or ground”. Indonesian also has comparative advantage among other exporter countries. Crucial strategies of internal and external perspectives, such as expanding markets, improving nutmeg quality and productivity through improving farmer capacity, technological adoption, and good agricultural practices are necessary to take into account Indonesia’s nutmeg competitiveness in global markets.

Economic Analysis of the Export Trends of Livestock and Livestock Products in India

Livestock provides livelihood to two-third of rural masses and employs about 8.8 per cent population of India. While dairying ensures livelihood to 70 million farm families. The study utilized export data from government sources and conducted a statistical analysis to assess trends and stability. Data revealed that the overall export value increased significantly from ₹22,092.62 crore in 2011-12 to ₹48,947.55 crore in 2021-22, reflecting a compound annual growth rate (CAGR) of 4.90%. Buffalo meat emerged as the leading export product, while dairy products exhibited a notable growth rate while dairy products and other categories showed varied growth. The instability index for the total exports was 19.02%, indicating moderate stability. State-wise analysis indicated Uttar Pradesh as the leading exporter, followed by Maharashtra and Haryana, with these three states together accounting for 85% of the total exports in 2021-22. The average growth rate of exports across states was 3.57%, demonstrating a stable growth pattern. Despite challenges posed by the COVID-19 pandemic, the sector showed resilience with a 13.98% growth in exports for 2021-22, aided by government initiatives. The analysis of dairy product exports highlighted a significant increase from ₹2,382.91 crore in 2020-21 to ₹4,742.70 crore in 2021-22, marking a 99% growth. The primary export destinations were the USA, Bangladesh, UAE, Saudi Arabia, Bahrain, and Malaysia. A transitional probability matrix revealed shifts in market shares, with notable increases in the USA and Bangladesh. Trade performance from 2011-22 showed that India's export share in dairy products improved from 0.03% to 0.135%, while import share decreased significantly. The instability index for exports was 63.53%, reflecting high volatility. Investing in advanced breeding technologies to increase productivity, and enhancing market access through trade agreements and promotional activities. Additionally, policies to manage volatility, such as price stabilization measures and export incentives, could further support industry growth.

Estimates of the trade and global value chain (GVC) effects of China’s Pilot Free Trade Zones: a research based on the quantitative trade model

While Pilot Free Trade Zones (PFTZs) have been promoted in China as a unilateral opening measure to boost economic growth amid deglobalization, their benefits in driving cities’ openness remain an underexplored research topic. This study aims to investigate the impact of PFTZs on cities’ trade performance. By employing a multi-region and multi-sector general equilibrium analytical model, the study reveals that the PFTZs enhance the overall level of openness across all cities in the country. Regarding the value-added sources, the PFTZs reduce the proportion of value-added originating from domestic regions and increase the proportion derived from international markets. Moreover, the PFTZs play a pivotal role in stimulating exports and strengthening the Chinese cities’ participation in the Global Value Chain (GVC). Meanwhile, the PFTZs enhance cities’ upstreamness in GVC while exerting an inhibitory effect on the downstreamness in GVC for most cities.

Analisis Pengaruh Kebijakan Moneter terhadap Perdagangan Internasional Indonesia

This study aims to analyze the impact of monetary policy on Indonesia's international trade using a literature review approach. The monetary policy implemented by Bank Indonesia, particularly concerning interest rates, inflation, and the exchange rate of the rupiah, significantly affects the performance of international trade. This study collects, evaluates, and synthesizes information from various relevant literature sources, including scholarly journal articles, books, research reports, and policy documents. The findings indicate that interest rates influence the competitiveness of export products through production costs, controlled inflation boosts foreign direct investment flows, and exchange rate stability supports long-term business planning and investment. Effective monetary policy can help create a stable trade environment, enhance the competitiveness of Indonesian products in the global market, and strengthen the country's economic position in the global supply chain.

Why do Indian exporting firms borrow in foreign currency?

Purpose Since the liberalization policy of 1991, India has focused on export-led growth. However, the performance of international trade remains poor. This study aims to examine the role of credit constraints on the choice of Indian manufacturing firms to borrow in foreign currency. First, it explores the role of export activities in foreign currency borrowing (FCB). Second, it investigates how credit constraints forced these firms for foreign currency loans. Design/methodology/approach The study analysed data from 1,412 firms listed on the Bombay Stock Exchange in the manufacturing sector, covering the period from 1991 to 2022. A random effects probit model was used to examine the role of credit constraints on FCB, incorporating the influence of micro, small and medium enterprises (MSMEs) status and export activities. Additionally, a two-step system-generalized method of moment was used for robustness checks. Findings Export activities significantly influence FCB, with exporting firms showing a higher propensity to borrow foreign currency compared to domestically operating firms because of the increased funding needs of export activities. Larger firms are more likely to secure FCB than MSMEs, benefiting from collateral advantages. MSME exporting firms exhibit a higher tendency to borrow in foreign currency compared to large exporting firms. Research limitations/implications This study focuses on firm-level data and considers only demand-side credit constraints. It does not examine supply-side credit constraints affecting FCB. Social implications This study underscores the credit constraints faced by MSME exporters in the domestic market, leading them to rely on FCB. These insights are valuable for policymakers aiming to reduce MSMEs' dependency on FCB and enhance their export performance. Originality/value The findings highlight that MSME exporting firms are more inclined to borrow in foreign currency than their larger counterparts. This tendency is driven by the credit constraints MSMEs face because of asymmetric information and underdeveloped financial markets, which compel them to seek FCB.

The Correlation Between the Value of Global Marketing Advertisements and Nigeria's Balance of Trade Performance

The Correlation Between the Value of Global Marketing Advertisements and Nigeria's Balance of Trade Performance

The Monetary and Fiscal Policies on International Trade in Indonesia

This study is to analyze how monetary and fiscal policies contribute to trade performance in Indonesia. The specific target of this study is to analyze the contribution and influence of variables such as exchange rate, inflation, trade balance, government expenditure, Tax, and investment in the short, medium and long term in Indonesia. So that it can show how much the contribution and influence of monetary and fiscal variables on trade performance in Indonesia. The results of this study explain that the largest contribution to the trade balance is the government expenditure and investment in the previous period, the largest contribution to inflation is the government expenditure and investment in the previous period, the largest contribution to government expenditure is the exchange rate and government expenditure itself in the previous period, the largest contribution to investment is government expenditure and investment itself in the previous period, the largest contribution to the exchange rate is the exchange rate itself and investment in the previous period, the largest contribution to Tax is government expenditure and exchange rate in the previous period.

Research on the Impact of Geopolitical Instability on Russian Trade

This study examines how global and country- specific geopolitical instability affects Russian trade using data from 1996 to 2021. A panel regression model analyzes trade between Russia and its 15 top trading partners, exploring both direct and indirect effects. The analysis focuses on how accumulated foreign direct investment (FDI) and exchange rate fluctuations mediate these relationships. The findings reveal that global geopolitical instability decrease Russian trade by 0.0558. Interestingly, this negative impact is partially mediated by a decrease in FDI (-0.0805). This aligns with the Structural Equation Modeling (SEM) results, which show a significant negative effect of global geopolitical instability on FDI (-1.209). This suggests that FDI acts as a key transmitter of the negative effects of global instability on Russian trade. The role of exchange rate fluctuations, however, is more complex. While the Sobel Test indicated a negative indirect effect, the SEM analysis shows a positive indirect effect through exchange rate fluctuations on trade. This suggests potentially countervailing effects of currency fluctuations, with depreciation potentially incentivizing exports while appreciation might make imports cheaper. The impact of country-specific geopolitical instability varies depending on the context. Industries like food products and textiles are significantly affected by geopolitical instability increase, while sectors such as fuels, metals and raw materials show resilience. Close trading partners are less affected by global instability but suffer from partner- specific instability. Geographically, Western Europe benefits from global instability but faces challenges from partner-specific instability, contrasting with Eastern Europe and Asia. Overall, this research contributes to the understanding of how geopolitical instability, mediated by FDI and exchange rates, shapes Russia's trade performance.

Evaluation of Trend of Foreign Exchange Reserve and Shipping Industry Trade Performance in Nigeria

This study focused on evaluation of the trend of Foreign Exchange Reserve (FX) and performance of shipping industry trade through examining the export and import trades within the periods 2011 to 2022. The objectives were to determine the correlation between trend values of FX with export and import shipping trades in Nigeria. Provisional data on Foreign Exchange Reserve, export and import trades from World Bank, CBN and Trend Economy were analyzed using spearman’s rank correlation coefficient analysis and it was observed that Foreign Exchange positively influences export and import shipping trades, however, the study infers that the impacts were not significant at 0.05 (2-tailed) Significance level. It concludes that the positive correlations between the data variables informs that decrease in FX influences decrease in export and import trade which also retar economic growth, development and reduced people’s standards of living in Nigeria. However, the reserve becomes the case. The study recommends immediate policy adjustment to hold and maintain strong Foreign Exchange which could boost country’s reserve for better performance of the shipping industry and other sectors of the economy.

The Prospects of AfCFTA in Promoting Industrialization and Economic Diversification in Africa

African Continental Free Trade Area (AfCFTA) functions as a boost for Africa's economic development by enhancing intra-African trade. This is because trade is an engine of growth and development. For the fact that most African nations that are located within the same region engage in similar and competitive production, the ensuing economic cooperation and trade exchanges not only have the promise of increasing trade but also stimulating other ancillary economic activities, creating new job opportunities, speeding up economic growth, promote the standard of living, and promote economic development. However, AfCFTA's record has not been very impressive. The main obstacles to intra- regional commerce among African countries include heavy reliance on trade in primary goods, high product and market concentration of exports, and inadequate regional manufacturing networks. This study therefore examines continental economic trends and Intra African Trade: Prospects for African Continental Free Trade Area. The study adopted qualitative methods of data collection and analysis and the comparative theory of integration. The study found that the low level of trade diversification implicated the capacity of the African Continental Free Trade Area (AfCFTA) to achieve improved intra-regional trade performances in Africa. African countries maintain as much as 77% export specialization, with higher external/world trade at 84.6 percent of their total import and export trade. The study recommended that Governments should invest in infrastructure development, including building roads, railways, ports, and airports, as well as improving access to electricity and broadband. Governments should adopt modern trade facilitation measures such as electronic customs systems, single window platforms, and risk management techniques and should align their technical regulations and norms with global best practices and standards, as those created by appropriate international standard-setting organisations like the International Organisation for Standardisation (ISO).

Analysis of Financial Development and Trade Performance in Nigeria

Despite the importance of financial development-international trade nexus and its implication for growth, studies have yet to look at the impact of new financial development indicators developed by the International Monetary Fund on international trade performance in Nigeria. This is one of the few attempts made to examine the elasticity of trade to financial development, given the inconclusive findings that permeate the literature. Therefore, this paper investigates the effect of financial development on aggregate trade performance in Nigeria using annual data from 1980 to 2021. The empirical framework is based on the ARDL approach to cointegration and error correction model. The findings revealed that (i) The ARDL bound test revealed the existence of a long-run equilibrium association between the variables; (ii) We find that a unit improvement in financial development induces a 1.1%-1.2% increase in trade performance in the short-run short term and a 9.7% in the long-run; (iii) The results show that a 1% increase in the exchange rate (depreciation) leads to a 0.01% improvement in trade performance in the short-term. The findings have important policy implications. The paper concludes that financial development contributes to trade performance.

Revisiting the effect of the EAC customs union on intra-regional trade performance: does it only matter for exports?

Revisiting the effect of the EAC customs union on intra-regional trade performance: does it only matter for exports?

Service sectors and trade through a digital medium: a modified gravity approach

ABSTRACT Given the increasing role played by services delivered through online platforms, this study is a first to undertake cross-sectoral examination of the trade performance of nine service sectors exploring only the digitally delivered components of these. The article makes two main contributions. First, in the absence of bilateral trade data, it develops gravity-like indices using a methodology to capture the influence of common variables used in the gravity literature. Sector-level unilateral import data on the WTO, GATS mode 1 of service delivery or cross-border trade, which is largely synonymous with digital trade, is drawn from the relatively new OECD-WTO-TiSMoS database. Next, the constructed gravity-like variables along with an index of the importer’s services trade restrictiveness, the level of internet penetration of the importing economy and their interaction are examined across the said sectors using a panel of 50 countries for the years 2014–2017. The findings of the constructed gravity variables support earlier literature using bilateral service trade data. The outcomes of the interactions reveal that the trade dampening effect of larger service trade restrictions is somewhat mitigated by deeper internet penetration in consumer services like education in contrast to others like insurance & financial services which are usually producer services.

Temporal Analysis of Factors Influencing Countries’ Maritime Trade Performance with CRITIC-based VIKOR Method

Temporal Analysis of Factors Influencing Countries’ Maritime Trade Performance with CRITIC-based VIKOR Method

Impact of WTO on Trade Performance of Tea and Coffee in India

Impact of WTO on Trade Performance of Tea and Coffee in India

Chickpea Production and Trade in India: Competitiveness and Trade Direction Analysis in the Global Market

The study examined the production and trade performance of chickpeas from 2001-2021. Trade direction was estimated using the Markov chain, and export competitiveness was measured using the nominal protection coefficient, revealed comparative advantages, and trade specification coefficient index. India leads other countries in chickpea area and production but lags behind chickpea productivity. India exported chickpeas to Algeria, UAE, Sri Lanka, Saudi Arabia, and the USA (2011-2021). Iran and the USA have been the most loyal markets for Indian chickpea exports. At the same time, Algeria and Sri Lanka were the biggest gainers among major chickpea-importing countries during Period I (2001-2010) and Period II (2011-2021), respectively. The chickpea exports in India are still competitive in the global market. However, India had a negative trade balance as its chickpea exports were lower than those of imports.