scholarly journals TRADE CREATION DAN TRADE DIVERSION ANTARA INDONESIA DAN NEGARA-NEGARA ASEAN-KOREA

2018 ◽  
Vol 3 (1) ◽  
pp. 64-81
Author(s):  
Tresna Ritaningsih ◽  
Dedi Budiman Hakim ◽  
Sahara Sahara
Keyword(s):  
Free Trade ◽  
Regional Integration ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Diversion ◽  
Trade Agreements ◽  
Trade Creation ◽  
Implementation Phase ◽  
Trading Partners ◽  
The Impact

Indonesia has several free trade agreements with trading partners that aimed to eliminate tariff and non tariff trade barriers. One of the free trade agreements is ASEAN-Korea FTA. Trade agreement in goods in ASEAN-Korea FTA was agreed since 2007 and now it is entering the implementation phase. The objective of this research is to determine whether the ASEAN-Korea FTA would increase the trade flows between Indonesia and ASEAN-Korea’ countries by analyzing the impact of regional integration on trade creation and trade diversion. This research is utilized balance panel data including 13 countries from 1998-2012. The empirical result shows that all Indonesia's trading sectors experienced decline because of trade diversion and trade creation does not occur. Indonesia's import trading with the non-member countries of ASEAN-Korea is 68% lower than the existing trading. Key word: trade creation, trade diversion, free trade agreement, trade in goods

scholarly journals TRADE CREATION DAN TRADE DIVERSION ANTARA INDONESIA DAN NEGARA-NEGARA ASEAN-KOREA

2018 ◽  
Vol 3 (1) ◽  
pp. 64-81
Author(s):  
Tresna Ritaningsih ◽  
Dedi Budiman Hakim ◽  
Sahara Sahara
Keyword(s):  
Free Trade ◽  
Regional Integration ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Diversion ◽  
Trade Agreements ◽  
Trade Creation ◽  
Implementation Phase ◽  
Trading Partners ◽  
The Impact

Indonesia has several free trade agreements with trading partners that aimed to eliminate tariff and non tariff trade barriers. One of the free trade agreements is ASEAN-Korea FTA. Trade agreement in goods in ASEAN-Korea FTA was agreed since 2007 and now it is entering the implementation phase. The objective of this research is to determine whether the ASEAN-Korea FTA would increase the trade flows between Indonesia and ASEAN-Korea’ countries by analyzing the impact of regional integration on trade creation and trade diversion. This research is utilized balance panel data including 13 countries from 1998-2012. The empirical result shows that all Indonesia's trading sectors experienced decline because of trade diversion and trade creation does not occur. Indonesia's import trading with the non-member countries of ASEAN-Korea is 68% lower than the existing trading. Key word: trade creation, trade diversion, free trade agreement, trade in goods

India’s Trade Potential and Free Trade Agreements: A Stochastic Frontier Gravity Approach

2017 ◽  
Vol 17 (1) ◽  
pp. 20160074 ◽  
Author(s):  
Surender Kumar ◽  
Prerna Prabhakar
Keyword(s):  
Free Trade ◽  
South Asian ◽  
Stochastic Frontier ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Agreements ◽  
Regulatory Quality ◽  
Trading Partners ◽  
Trade Potential ◽  
The Impact

This paper analyses the role of Free Trade Agreements in determining export and import efficiency levels in India using stochastic frontier version of gravity model. We estimate the impact of selected FTAs of India (its bilateral FTAs, FTA with ASEAN and South Asian FTA) and regulatory quality on the efficiency of exports and imports over the period of 2000–2014. The results indicate that India’s bilateral FTAs and its FTA with the ASEAN group help in improving the export and import efficiency respectively. However, the South Asian Free Trade Agreement is statistically insignificant for India’s export and import efficiency. The results also highlight importance of trading partners’ regulatory quality for enhancing the India’s trade efficiency and note that the impacts of regulatory quality are non-monotonic.

scholarly journals Free Trade Agreement between Turkey and Russian Federation and its Possible Effects to these Countries’ Trade and Taxational Reflections

2015 ◽  
Author(s):  
Raşit Gültekin ◽  
Mustafa Erkan Üyümez
Keyword(s):  
International Trade ◽  
Free Trade ◽  
Russian Federation ◽  
Regional Integration ◽  
Free Trade Agreement ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Agreements ◽  
Trade Restrictions ◽  
The Impact

The last period of international trade in goods covers a process carried out with globalization and regionalization efforts. Many countries, on the one hand, take part in arrangements that are executed under the leadership by global actors and aim at removing or reducing conventional obstacles to international trade, on the other hand, participate in various and regional economic integrations to provide a more deep and comprehensive economic cooperation and to cope with the competition and trade restrictions which continually increasing due to political, commercial and economical motives. Trade relations between Turkey and Russian Federation is an important element of the two countries' multidimensional cooperation. The most effective attempt to raise the top level of the volume and quality of existing commercial relationships will be the signing and putting into practice of a comprehensive free trade agreements between the two countries that have not been done previously. The purpose of this study is to determine the potential effects of such a free trade agreements between Turkey and Russian Federation in terms of trade in goods between two countries. To this end, in this study, theoretical aspects of free trade agreements' effects and place within regional integration types will be considered the impact of the possible Turkey-Russia free trade agreement will be examined in a framework of basic provisions with customs duties that set out in free trade agreements, recent trade data and key issues related to these countries.

scholarly journals The Impact of ASEAN-Korea Free Trade Agreements on Indonesian Export of Manufacturing Goods

ETIKONOMI ◽  
2018 ◽  
Vol 17 (2) ◽  
pp. 161-184
Author(s):  
Bernadheta Mia Tri Mareta
Keyword(s):  
Free Trade ◽  
Fixed Effects ◽  
Export Performance ◽  
Free Trade Agreements ◽  
Trade Diversion ◽  
Trade Agreements ◽  
Least Square ◽  
Gravity Models ◽  
Trade Creation ◽  
The Impact

Along with an attempt to promote the export performance of manufacturing goods, the number of investigation about the potential benefit or harm of free trade agreements is still weak in Indonesia. This paper highlights the effect of ASEAN-Korea Free Trade Agreement (AKFTA) on Indonesian export of manufacturing products since AKFTA as one of the significant initiatives in Southeast Asia is expected to boost Indonesian export. By using augmented gravity models with panel data, this paper investigates the presence of trade creation and trade diversion effects on Indonesian export with 20 trading partners, covering a 26-year period from 1990-2015. Fixed effects with least square dummy variable (LSDV) models are applied to tackle the endogeneity problems of FTA by controlling the unobserved heterogeneity. The results showed that trade diversion outweighs trade creation effects in almost all categories, confirming a decrease in export from member to non-member countries.DOI: 10.15408/etk.v17i2.7342

scholarly journals Estimating the Impact of EU Membership on United Kingdom’s Export by Using Gravity Model

2021 ◽  
Vol 1 (1) ◽  
pp. 7-16
Keyword(s):  
Gravity Model ◽  
Free Trade ◽  
Regional Integration ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Eu Membership ◽  
Trading Partners ◽  
Time Periods ◽  
The Impact ◽  
The Eu

After a year from the formal UK withdrawal from the EU, there are still different opinions about the potential economic impact of Brexit. This paper gives a detailed overview of the trade profile of UK and explores the determinants of United Kingdom`s export. We apply the gravity model to estimate the aggregate benefits of EU membership or the reversed, lost (foregone) benefits from leaving the EU. We measure the influence of GDP, distance, population, the EU membership, and signed free trade agreement with the trading partners on UK’s export as a dependent variable. The analysis includes data for 70 UK trading partners in a period of 48 years (from 1973 to 2020) since Great Britain become EU member. The results show that UK’s export is directly proportional to trade partner’s GDP and inversely proportional to distance. In order to estimate the average benefit due to EU membership, we estimated subsequent equations with different time periods. The coefficient decreases and becomes negative as we shorten the time periods, proving that the average trade advantage due to EU membership diminishes over time. According to the economic theory of regional integration, it is expected that the coefficient increases due to many rounds of enlargement, especially the biggest one in 2004 as well as due to the introduction of the Euro. On the contrary, as we shorten the time periods in the analysis, we obtained increasing coefficient for the variable free trade agreements. This confirms that trade exchange within FTA has significantly higher effect on United Kingdom’s export in comparison with trade within EU.

Was India Right in Not Joining RCEP? A Cost–Benefit Analysis

2021 ◽  
pp. 097492842110477
Author(s):  
Monika Jain
Keyword(s):  
New Zealand ◽  
South Korea ◽  
Free Trade ◽  
Trade Diversion ◽  
Trade Agreements ◽  
Asia Pacific ◽  
Trade Creation ◽  
Asean Countries ◽  
The Cost ◽  
The Impact

India dropped out of the Regional Comprehensive Economic Partnership (RCEP), which included the Association of Southeast Asian Nations (ASEAN) countries, China, South Korea, New Zealand, Japan and Australia, after negotiating for almost seven years in November 2018 on the grounds of national interest and also that free trade agreements (FTAs) did not amount to free trade and led to more trade diversion than trade creation. The cost and benefit of a regional agreement depend on the amount of trade creation with respect to trade diversion (Panagriya, 2000). This study tries to examine India’s concerns and at the same time, highlights the cost of not joining RCEP. India’s trade deficit with 11 out of the 15 RCEP nations has been a major cause of concern. Unfavourable trade balance, concerns about the impact on dairy sector, economic slowdown, past experience with FTA’s, China factor, data localisation, rules of origin, the experience of ASEAN countries with Sino-FTA have been some of the reasons behind India’s decision to opt-out of this mega multilateral agreement. Also, bilateral trade agreements with some RCEP countries such as Japan, Malaysia, Singapore, Thailand and South Korea were operational. A multilateral trade agreement with ASEAN countries was very much in place. So, trade between India and 12 of the RCEP member countries would not have changed much after India’s inclusion in RCEP. The impact of lower tariffs would have been evident for the remaining three countries: China, Australia and New Zealand. Furthermore, there was fear of a massive surge in imports of manufactures from China, dairy imports from Australia and New Zealand. This study also examines the long term impact of this decision and if India has missed out on becoming a part of the global value chain and gaining greater market access in the Asia Pacific region. India’s policy of import substitution and protectionism did not capitulate desired results in the past. Hence, a critical evaluation of India’s decision and some validation on her concerns and fears have been done.

scholarly journals The ASEAN Free Trade Agreement and Vietnam’s Trade Efficiency

2017 ◽  
Vol 13 (4) ◽  
pp. 192 ◽  
Author(s):  
Hai Thi Hong Nguyen ◽  
Thang Ngoc Doan
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Agreements ◽  
Trade Volume ◽  
Large Space ◽  
Trading Partners ◽  
Efficiency Performance ◽  
Stochastic Gravity

This study employs a stochastic gravity model to estimate the efficiency performance of Vietnam’s trade with its main trading partners from 1995-2015. Trade efficiency is measured as the ratio of actual trade volume to the maximum likelihood. Moreover. it analyzes the effects of both natural and man-made trade barriers on trade efficiency. The empirical results suggest that the actual trade of Vietnam appears to be much smaller than a possible efficiency level and that there is large space for further progress. Export efficiency outweighs that of import. Vietnam’s ASEAN Free Trade Agreement membership has, in general, improved the trade efficiency, whereas tariffs and domestic devaluation have impaired it. Our findings lead to the recommendation that Vietnam should join more Free Trade Agreements and break down the man-made barriers.

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.

Exploiting the Trade Potential from Integration: Analysing the Impact of Free Trade Agreements between ASEAN and India and China

China Report ◽  
2018 ◽  
Vol 54 (4) ◽  
pp. 442-466 ◽  
Author(s):  
Nguyen Xuan Trung ◽  
Nguyen Duc Hung ◽  
Nguyen Thi Hien
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Bilateral Trade ◽  
Positive Impact ◽  
Stochastic Frontier ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Agreements ◽  
The Impact ◽  
Stochastic Frontier Estimation

In this article, we use the technique of stochastic frontier estimation for the structural gravity model to analyse Vietnam’s bilateral trade and evaluate its exploitation of trade efficiency before and after its free trade agreements (FTAs) with China and India entered into force. The results from Vietnam’s bilateral trade data between 2000 and 2015 show that the ASEAN–India Free Trade Agreement (AIFTA) has had a positive impact on Vietnam’s bilateral trade flows while we found a remarkably negative effect on Vietnam’s exports but not imports after the entry into force of the ASEAN-China Free Trade Agreement (ACFTA). In addition, Vietnam’s participation in the regional trade agreements (RTAs) and FTAs has significantly reduced the costs of trade over time, and these impacts on Vietnam’s imports are much higher than those on Vietnam's exports.

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