scholarly journals Impact of removing industrial tariffs under the European–Vietnam free trade agreement

2019 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Le Trung Ngoc Phat ◽  
Nguyen Kim Hanh
Keyword(s):  
Social Welfare ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Household Consumption ◽  
Industrial Sector ◽  
Cge Model ◽  
Content Type ◽  
Factors Of Production ◽  
The Impact

Purpose The purpose of this paper is to employ the computable general equilibrium (CGE) approach to examine how the European–Vietnam Free Trade Agreement (EVFTA) impacts on the Vietnamese economy in the case of the removal of industrial tariffs. Design/methodology/approach The authors construct a social accounting matrix based on the latest data of the Vietnam input-output Table for the year 2012 and then apply the CGE model to simulate the economic scenarios when the tariff rate of the industrial sector reduces to 0 percent. Findings The first simulation results demonstrate that the elimination of tariffs in the industrial sector will lead to a 9.13 percent increase in household consumption, together with an increase in the factors of production of the agricultural, industrial and service sectors by 9.61, 9.74 and 8.21 percent, respectively. The EVFTA also causes a deficit in the trade balance because the value of imports increases by 12.54 percent, while exports’ value slightly increases by 2.71 percent. Furthermore, there has been a drop of 2.29 percent in the total government income; nevertheless, social welfare witnesses a gain of 9.13 percent. The second scenario simulation draws crucial attention to policymakers that a small fluctuation in the production tax rate will cause a significant change in the economy. Practical implications The reduction of tariff in the industrial sector will increase the social welfare and strengthen the whole economy regarding the growth of household consumption, factors of production and trade value. On the unfavorable side, the EVFTA causes a national budget deficit and puts pressure on domestic production. This paper is a valuable reference for governments and policymakers when they decide to reduce tariffs or adjust production taxes once Vietnam integrates into the world economy. Originality/value This study differs from previous research works by utilizing a static CGE model to investigate the impact of removing the industrial tariff on the economy under EVFTA.

Modelling welfare effects under Pakistan–China free trade agreement

2018 ◽  
Vol 11 (3) ◽  
pp. 202-218 ◽  
Author(s):  
Lubna Uzair ◽  
Ahmad Nawaz
Keyword(s):  
Trade Policy ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Academic Research ◽  
Trade Agreement ◽  
Policy Formulation ◽  
Trade Creation ◽  
Content Type ◽  
The World ◽  
The Impact

PurposeThis paper aims to empirically examine the trade creation and diversion impacts on merchandise imports of Pakistan under the Pakistan–China Free Trade Agreement (FTA). The analysis of Pakistan’s preferential treatment with its largest trade partner as well as the most substantial exporter of the world will help to shape trade policy, open windows for academic research and also gives an immense contribution in literature.Design/methodology/approachA disaggregated panel data on the imports of Pakistan from China and other WTO member countries and tariff concessions at Harmonized System (HS) two-digit level used for the agreement period of 2006-2012. The empirical analysis takes care of bias through robust and panel-corrected standard errors with time, industry-specific effects and controlling for multilateral trade resistance.FindingsEvidence found in support of trade creation under the Pakistan–China FTA. It means overall this agreement increased the welfare of Pakistani consumers.Practical implicationsFindings are in favour of negotiations and signing for the next round of this agreement and with other major trade partners like the US and Saudi Arabia.Originality/valueIt is worth investigating empirically the impact of preferential trade liberalization between Pakistan – a developing country – and China – the largest importer of the world – explicitly, in the form of trade creation or diversion. The empirical assessment of this FTA signed with the world’s largest exporter will not only contribute immensely to the literature but also help in trade policy formulation and open windows for academic research. Another unique aspect of this study is the use of disaggregated data consisting of all goods imports along with tariff concessions at two-digit Harmonized System (HS) code.

Brexit and the EU–UK free trade agreement: dos and don’ts when drafting rules of origin

2019 ◽  
Vol 18 (2) ◽  
pp. 96-107
Author(s):  
Roberto Soprano
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Utilization Rate ◽  
The European Union ◽  
Rules Of Origin ◽  
Content Type ◽  
Corporate Strategies ◽  
Pros And Cons ◽  
The Impact

Purpose The purpose of this paper is to highlight the pros and cons of different models of the European Union (EU)-style Rules of Origin (RoO) that could be chosen by negotiators for a future UK–EU Free Trade Agreement (FTA). It will also underline the impact that any choice would have on economic operators and certain criteria that should be evaluated before taking any decisions on the adoption of RoO. Design/methodology/approach The paper will describe three different RoO models that could be chosen by negotiators. For each of them, it analyses the pros and cons and the impact on economic operators. Findings The choice of a RoO would have an impact on future EU–UK trade relations. It will affect the utilization rate of the FTA as well as investment (and divestment) corporate strategies in the UK and EU. Originality/value The paper introduces different criteria to evaluate the impact of RoO that should be taken into consideration by negotiators. It emphasizes that RoO should be simple, predictable, coherent, IT compatible and easily adaptable.

Nigeria free trade agreement benefits should win out

2019 ◽  
Keyword(s):  
Free Trade ◽  
Food Processing ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Industrial Sector ◽  
Political Opposition ◽  
Medium Term ◽  
New Markets ◽  
Content Type ◽  
Food And Beverage

Subject Nigeria joins AfCFTA. Significance After over a year of consultations and deliberations, President Muhammadu Buhari’s administration on July 7 finally signed up to the African Continental Free Trade Agreement (AfCFTA). Despite some valid concerns from local industry and ongoing political opposition, Buhari followed the recent recommendations of a government-commissioned committee. Impacts Over the medium term, Nigerian consumers should benefit from cheaper imports in areas such as the food and beverage sectors. The industrial sector will see some reorganisation, with competitive sectors looking to expand their capacity to tap into new markets. Several sectors (such as poultry or food processing) will likely undergo productivity enhancing reorganisation amid new competition threats.

Assessment of the Proposed India-China Free Trade Agreement: A General Equilibrium Approach

2015 ◽  
Vol 8 (2) ◽  
pp. 81-108 ◽  
Author(s):  
Rahul Arora ◽  
Sarbjit Singh ◽  
Somesh K. Mathur
Keyword(s):  
General Equilibrium ◽  
Free Trade ◽  
World Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Tariff Reduction ◽  
Trade Association ◽  
Content Type ◽  
The World ◽  
The Impact

Purpose The present study is an attempt to evaluate the impact of the proposed India-China free trade agreement (FTA) in goods trade on both countries under a static general equilibrium framework. Design/Methodology/Approach The study has utilized the Global Trade Analysis Project (GTAP) model of world trade with the presence of skilled and unskilled unemployment in the world. For analysis purposes, 57 GTAP sectors, representing the whole regional economy, have been aggregated into 43 sectors and 140 GTAP regions, representing the whole world, have been aggregated into 19 regions. The study has also used the updated tariff rates provided by the World Trade Organization for better results. Findings The preliminary analysis using trade indicators depicted that by utilizing their own comparative advantage, both of the countries can maximize their gains by exporting more to the world. The simulation results from the GTAP analysis revealed that a tariff reduction in all goods trade would be more beneficial for both the countries than the tariff reduction in each other's specialized products. All other regions lose in terms of shifting the Indian imports towards China in a post-simulation environment. Regions with a significant loss are: the European Union (28 members), Southeast Asia, the Unites States, Japan, Korea, West Asia, and the European Free Trade Association (EFTA). Originality/Value The disaggregated sector-wise analysis has been performed using the latest available GTAP database, version 9.

Liberalization and tariff dismantling

2016 ◽  
Vol 118 (2) ◽  
pp. 250-271
Author(s):  
Fernando González Laxe ◽  
Federico Martín Palmero ◽  
Domingo Calvo Dopico
Keyword(s):  
Free Trade ◽  
Value Chain ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Trade Liberalisation ◽  
The European Union ◽  
Production Sector ◽  
Content Type ◽  
Mussel Farming ◽  
The Impact

Purpose – The purpose of this paper is to assess the impact that the free trade agreement between the European Union (EU) and Chile and its resulting dismantling of tariffs has had on the mussel cultivation industry, particularly in Galicia. Specifically, the authors examine how trade liberalisation has affected the mussel farming industry. Design/methodology/approach – The authors aim to observe the general panorama of both the evolution of production, distinguishing between fresh and industrial usage, and the evolution of prices at source depending on destination (fresh or industrial in the period 2003-2012). In order to analyse the relationships between different agents of the value chain, Porter’s model has been used as a reference. Findings – There is a loss of competitiveness in the mussel farming-production sector following the liberalisation agreement of 2006 and huge bargaining power of the processing sector vs the production sector. Practical implications – There is an opportunity to implement traceability programmes and develop a more differentiated product. In addition, it is profitable to promote Galician mussels through generic advertising and promoting exports. Originality/value – There is a lack of empirical studies about the impact that the new free trade agreement between the EU and Chile has had on the Spanish mussel industry. Particularly, the study analyses economic repercussions, managerial implications and new challenges stemming from the new context of trade liberalisation.

Assessing the Impact of the Australia-United States Free Trade Agreement (AUSFTA) on Australian and Global Medicines Policy

2005 ◽  
Author(s):  
Thomas Alured Faunce ◽  
Evan Doran ◽  
David Henry ◽  
Peter Drahos ◽  
Andrew Searles ◽  
...  
Keyword(s):  
United States ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
The Impact

scholarly journals Analysis of Welfare Effects of South Asia Free Trade Agreement (SAFTA) on Pakistan’s Economy by Using CGE Model

2010 ◽  
Vol 7 (1) ◽  
Author(s):  
Imamuddin Khoso ◽  
Nanik Ram ◽  
Asif Ali Shah ◽  
Kamran Shafiq ◽  
Faiz. M. Shaikh
Keyword(s):  
South Asia ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Welfare Effects ◽  
Cge Model

scholarly journals Estimating the Impact of ASEAN China Free Trade Agreement on Indonesia’s Trade Balance

2019 ◽  
Vol 1 (1) ◽  
pp. 18-37
Author(s):  
Muhammad Arif Junaidi
Keyword(s):  
Gravity Model ◽  
Free Trade ◽  
Significant Role ◽  
Trade Balance ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Trade Flows ◽  
Insignificant Effect ◽  
Asean Countries ◽  
The Impact

Using trade flows data of ASEAN countries and China from 2002 to 2017, this studyestimates the impact of ACFTA on ASEAN countries and China’s trade balance in general,and also for Indonesia’s trade balance in specific by elaborating the impact of ACFTA onthe trade flows both exports and imports. Using the gravity model and estimating by OLSand PPML, this paper finds that the impact of tariffs elimination due to the implementationof ACFTA increased exports and imports for ASEAN countries and China in general, andfor Indonesia in particular. However, the aggregate trade balances of ASEAN membercountries and China is zero since the impact of ACFTA on imports offset the impact ofACFTA on exports. Tariff’s elimination due to the implementation of ACFTA on Indonesiashows a negative and statistically insignificant effect on imports and exports. Thus, tariffshave not played significant role on increasing Indonesia’s exports and imports. As a result,the impact of ACFTA on Indonesia’s trade balance cannot be quantified clearly since theimpact of tariffs on exports and imports are not significant.

scholarly journals The Effect of IJ-EPA to Indonesia Export: Interupted Time Series (ITS) Approach

2020 ◽  
Vol 2 (1) ◽  
pp. 128-145
Author(s):  
Yuafanda Kholfi Hartono ◽  
Sumarto Eka Putra
Keyword(s):  
Time Series ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Time Series Data ◽  
Current Account Deficit ◽  
Trade Agreement ◽  
Export Market ◽  
Series Data ◽  
The Government ◽  
The Impact

Indonesia Japan Economic Partnership Agreement (IJ-EPA) is a bilateral free-trade agreement between Indonesia and Japan that has been started from July 1st, 2008. After more than a decade of its implementation, there is a question that we need to be addressed: Does liberalization of IJ-EPA make Indonesia’s export to Japan increase? This question is important since the government gives a trade-off by giving lower tariff for certain commodities agreed in agreement to increase export. Using Interrupted time series (ITS) analysis based on time-series data from Statistics Indonesia (BPS), this article found that the impact of IJ-EPA decreased for Indonesia export to Japan. Furthermore, this paper proposed some potential commodities that can increase the effectiveness of this FTA. The importance of this topic is that Indonesia will maximize the benefit in implementing of agreement that they made from the third biggest destination export of their total export value, so it will be in line with the government's goal to expand export market to solve current account deficit. In addition, the method that used in this paper can be implemented to other countries so that they can maximize the effect of Free Trade Agreement, especially for their export.

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