scholarly journals Impact of FTA on Trade in ASEAN and Australia Using Customs Level Data

2021 ◽  
Vol 36 (3) ◽  
pp. 437-461
Author(s):  
Shandre M. Thangavelu ◽  
Dionisius Narjoko ◽  
Shujiro Urata
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Utilization Rate ◽  
Rules Of Origin ◽  
Asean Member ◽  
Preferential Tariff ◽  
Level Data ◽  
Asean Countries ◽  
The Impact

This study examines the impact of the Association of Southeast Asian Nations (ASEAN)-Australia-New Zealand Free Trade Agreement (AANZFTA) on Australian trade with a particular focus on imports from ASEAN member countries to Australia. We examine the AANZFTA’s utilization by ten ASEAN countries at the six-digit trade classification level from 2012 to 2016 using Australian customs data. We implement Ando and Urata’s (2018) and Hayakawa et al.’s (2014) framework of free trade agreement (FTA) utilization based on preferential tariff margins. We also account for overlapping FTAs that are likely to impact the AANZFTA’s utilization. The results indicate that preferential tariff margins positively impact FTA utilization. However, the results also indicate that the AANZFTA’s utilization rate across ASEAN countries is low relative to Australia’s bilateral FTAs with Malaysia, Thailand, and Singapore. We also find evidence that co-sharing rules of origin positively impact FTA utilization.

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.

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 Impact of Free Trade Agreement Use on Import Prices

2018 ◽  
Vol 33 (3) ◽  
pp. 643-660
Author(s):  
Kazunobu Hayakawa ◽  
Nuttawut Laksanapanyakul ◽  
Hiroshi Mukunoki ◽  
Shujiro Urata
Keyword(s):  
Free Trade ◽  
Fixed Effects ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Firm Characteristics ◽  
Most Favored Nation ◽  
Rules Of Origin ◽  
Import Prices ◽  
Percentage Points ◽  
The Impact

Abstract We examine the impact of free trade agreement (FTA) use on import prices. For this analysis, we employ establishment-level import data with information on tariff schemes, that is, the FTA and most-favored-nation schemes used for importing. Unlike previous studies, we estimate the effects of FTA use on prices by controlling for differences in importing-firm characteristics. There are three main findings. First, the effect of FTA use is overestimated when not controlling for importing firm-related fixed effects. Second, on average, firms’ FTA use reduces tariffs by 12 percentage points and raises import prices by 3.6–6.7 percent. Third, in general, we do not find a price rise resulting from the costs of complying with rules of origin.

scholarly journals Trade, Agriculture and Illegal Markets: Coca in the Colombia-US Free Trade Agreement

2021 ◽  
Author(s):  
Juan Felipe Ladino Mateus
Keyword(s):  
Trade Liberalization ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Agricultural Sector ◽  
Market Access ◽  
Trade Agreement ◽  
Credit Access ◽  
Level Data ◽  
Illegal Activities ◽  
The Impact

Trade liberalization has the potential to generate gains in an economy. Nevertheless, sensitive sectors like agriculture present difficulties because of the need to adapt to the new competition. Consequently, trade policy may affect economic conditions and lead to incentives for illegal activities. Using municipal level data for Colombia, I examine the effect of trade liberalization in the agricultural sector on coca crops. Using a difference-in-differences strategy in the Colombia-US Free Trade Agreement framework, I find that municipalities that depend highly on the cultivation of the most important crops present a differential decrease in the area covered with coca after the agreement implementation. The effect is consistent with incentives from more market access and more imports of lower-price inputs. I find that credit access drives the decrease in coca. Nonetheless, small farming decreases the impact. The results highlight the importance of trade, complemented with other policies, as a tool for development.

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 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.

scholarly journals From Final Goods to Inputs: The Protectionist Effect of Rules of Origin

2018 ◽  
Vol 108 (8) ◽  
pp. 2335-2365 ◽  
Author(s):  
Paola Conconi ◽  
Manuel García-Santana ◽  
Laura Puccio ◽  
Roberto Venturini
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Cross Product ◽  
Intermediate Goods ◽  
Rules Of Origin ◽  
The North ◽  
Cross Country ◽  
Unique Dataset

Recent decades have witnessed a surge of trade in intermediate goods and a proliferation of free trade agreements (FTAs). FTAs use rules of origin (RoO) to distinguish goods originating from member countries from those originating from third countries. We focus on the North American Free Trade Agreement (NAFTA), the world’s largest FTA, and construct a unique dataset that allows us to map the input-output linkages in its RoO. Exploiting cross-product and cross-country variation in treatment over time, we show that NAFTA RoO led to a sizable reduction in imports of intermediate goods from third countries relative to NAFTA partners. (JEL F13, F15, F23, L14, O19)

FREE TRADE AGREEMENTS AND BRIDGEHEAD EFFECT: EVIDENCE FROM KOREA–CHILE FTA

2016 ◽  
Vol 61 (05) ◽  
pp. 1550098
Author(s):  
KICHUN KANG ◽  
PHYLLIS KEYS ◽  
YOON S. SHIN
Keyword(s):  
South America ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Direct Evidence ◽  
Recent Literature ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Agreements ◽  
The Impact ◽  
Aggregate Industry

Recent literature on the dynamics of export destinations has argued that firms export their products to new markets that are geographically close and culturally related to their previous export destinations. A modified version of [Melitz, M (2003). The impact of trade on intra-industry reallocations and aggregate industry productivity. Econometrica, 71(6), 1695–1725.] model suggests that a preferential trade agreement may provide inefficient firms with opportunities to export their products to third destination countries. This paper finds that new Korean products have been exported to the Chile market because of reductions in Chilean tariffs and the experience gained from exporting to the Chilean market has increased the likelihood of subsequent export to other countries in South America. The paper provides direct evidence that a free trade agreement (FTA) can serve as a stepping stone to other markets.

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