scholarly journals The Effects of Global Value Chain Participation on Current Account Balances in African Economies: Does it Matter Being a Landlocked Country?: An Empirical Review

2021 ◽  
pp. 53-64
Author(s):  
Ningaye Paul ◽  
Tchounga Anatole ◽  
Kenfack Geraud Francis
Keyword(s):  
Current Account ◽  
Value Chain ◽  
Trade Openness ◽  
Least Square ◽  
Current Account Balance ◽  
Global Value Chain ◽  
African Countries ◽  
Secondary Sources ◽  
Significant Coefficient ◽  
Current Account Balances

The general objective of this paper is to evaluate the effects of Global Value Chain Participation (GVCP) on Current Account Balance (CAB) in African countries. The specific objectives are to (1) identify the type of GVCP that contributes more significantly and positively to African countries’ current account balance and (2) find out whether being landlocked affects a country’s participation in global value chain in Africa. This paper uses panel data from three secondary sources: (1) UNCTAD-EORA database (2018) for forward and backward participation indicators, (2) WDI (2018) for current account balance, FDI, population and trade openness and (3) PWT 9.1 for exchange rates. In a linear panel specification, this research applies the Feasible Generalized Least Square (FGLS) econometric techniques and results highlight firstly that forward GVCP contributes more significantly and positively to CAB in Africa with a coefficient ranging between 1.64 and 2.43 in various regressions. Secondly, the effect of GVCP on CAB is reduced in landlocked African countries as revealed in its negative and significant coefficient of -2.33 as the variables are interacted. This paper recommends that, African countries should embark on forward participation and improve connectivity infrastructure to facilitate the participation of landlocked African economies in global interactions.

scholarly journals Global Value Chain Participation and Current Account Balances in Landlocked African Countries

2020 ◽  
pp. 1-14
Author(s):  
Kenfack Geraud Francis ◽  
Ningaye Paul ◽  
Kuipou Toukam Christophe
Keyword(s):  
Current Account ◽  
Value Chain ◽  
Trade Openness ◽  
Value Added ◽  
Least Square ◽  
Current Account Balance ◽  
Global Value Chain ◽  
African Countries ◽  
Data Set ◽  
Development Indicator

The objective of this paper is to find out the direction of Global Value Chain Participation (GVCP) that contribute more to the Current Account Balance (CAB) in landlocked African countries from 2000 to 2018. Our specification follows the IMF's External Balance Assessment (EBA) model. The Feasible Generalized Least Square (FGLS) econometric technique is applied on data from three sources: (1) UNCTAD-EORA database for forward and backward participation indicators, (2) World Development Indicator (WDI) data set, for current account balance, foreign direct investment (FDI), population and trade openness and (3) Penn World Tables (PWT) for exchange rates. Results highlight a positive and significant contribution of forward GVCP on CAB in landlocked African countries. The study recommends that landlocked African countries should be active providers of value-added intermediary inputs to other Global Value Chain actors.

Global value chain participation and current account imbalances

2019 ◽  
Vol 97 ◽  
pp. 111-124 ◽  
Author(s):  
Johannes Brumm ◽  
Georgios Georgiadis ◽  
Johannes Gräb ◽  
Fabian Trottner
Keyword(s):  
Current Account ◽  
Value Chain ◽  
Global Value Chain ◽  
Current Account Imbalances ◽  
Account Imbalances

scholarly journals Analisis faktor-faktor yang mempengaruhi utang luar negeri Indonesia

2019 ◽  
Vol 7 (3) ◽  
pp. 137-146
Author(s):  
Reza Fahlepi ◽  
Syaparuddin Syaparuddin
Keyword(s):  
Current Account ◽  
Budget Deficit ◽  
Foreign Debt ◽  
Multiple Regression Model ◽  
Least Square ◽  
Coefficient Of Determination ◽  
Current Account Balance ◽  
Ordinary Least Square ◽  
The Current Account

The purpose of this study is to (1) see the description of Indonesia's foreign debt, saving-investment gap, current account balance, and the budget deficit for the period 1990-2016. (2) analyze the effect of the saving-investment gap, current account balance, and budget deficit on Indonesia's foreign debt. The method used in this research is descriptive quantitative analysis with multiple regression model analysis using the Ordinary Least Square (OLS) method. The results of this research are the average development of Indonesia's foreign debt is 6.21 percent, the Saving-Investment gap is 12.47 percent, the current account balance is 394.19 percent, and the budget deficit is 60.91 percent. Based on the analysis results, the Saving-Investment gap and budget deficit have a positive and significant effect on foreign debt. In contrast, the current account balance has a negative and insignificant effect on foreign debt, with a coefficient of determination of 85.52 percent. Keywords: Foreign debt, Saving-investment gap, Current account, Budget deficit

scholarly journals Pengaruh ekspor, utang luar negeri, neraca transaksi berjalan dan neraca transaksi modal terhadap cadangan devisa di Indonesia

2020 ◽  
Vol 8 (1) ◽  
pp. 43-54
Author(s):  
Graselita Aritonang ◽  
Amril Amril ◽  
Zulgani Zulgani
Keyword(s):  
Foreign Exchange ◽  
Current Account ◽  
Descriptive Analysis ◽  
Foreign Debt ◽  
Multiple Regression Model ◽  
Least Square ◽  
Coefficient Of Determination ◽  
Current Account Balance ◽  
Capital Account ◽  
Foreign Exchange Reserves

The purpose of this study is to (1) see the description of Indonesia's foreign exchange reserves, exports, foreign debt, current account balance, and capital account balance for the period 1998-2017. (2) analyze the effect of exports, foreign debt, current account balance, and capital account balance on Indonesia's foreign exchange reserves. The method used in this research is quantitative descriptive analysis with multiple regression model analysis using the Ordinary Least Square (OLS) method. The results of this study show that the average development of Indonesia's foreign exchange reserves is 11.87 percent, exports are 7.38 percent, foreign debt is 4.51 percent, the current account balance is 514.89 percent and the capital account balance is 66.92 percent. Based on the results of the analysis carried out by exports, foreign debt, current account balance, and capital account have a positive and significant effect on foreign exchange reserves with a coefficient of determination of 98.37 percent. Keywords: Foreign exchange, export, Foreign debt, Current account, Capital account

scholarly journals EXCHANGE RATES ELASTICITY OF EXPORTS IN ASEAN: THE ROLE OF GLOBAL VALUE CHAINS

2021 ◽  
Vol 15 (1) ◽  
pp. 1-26
Author(s):  
Defy Oktaviani ◽  
Nagendra Shrestha
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Value Chain ◽  
The Philippines ◽  
Least Square ◽  
Real Effective Exchange Rate ◽  
Global Value Chain ◽  
Dummy Variable ◽  
Effective Exchange ◽  
Effective Exchange Rate

Abstrak Perdebatan tentang pelemahan hubungan antara nilai tukar dan ekspor telah meningkat dalam beberapa tahun terakhir, dan meningkatnya tren perdagangan terkait rantai nilai global (Global Value Chain/GVC) diasumsikan menjadi sumber melemahnya hubungan di antara keduanya. Dengan menggunakan data spesifik industri manufaktur, studi ini bertujuan untuk menyelidiki dampak GVC pada hubungan Nilai Tukar Efektif Riil (Real Effective Exchange Rate/REER) dan ekspor di empat negara ASEAN. Estimasi dilakukan menggunakan regresi Least Square Dummy Variable (LSDV) untuk periode sampel dari tahun 2009 hingga 2015. Hasil penelitian ini menunjukkan bahwa di Filipina, koefisien elastisitas nilai tukar ekspor dan partisipasi ke GVC tidak signifikan secara statistik. Sebaliknya di Indonesia dan Malaysia, secara rata-rata, integrasi ke GVC dengan berbagai pengukuran akan menurunkan elastisitas ekspor terhadap perubahan REER sekitar 70% sampai 89%. Lebih lanjut, estimasi terhadap data Thailand dan kelompok empat negara ASEAN menunjukkan bahwa partisipasi pada GVC mengubah nilai dan tanda elastisitas ekspor terhadap REER. Kata Kunci: Ekspor, Nilai Tukar, Rantai Nilai Global   Abstract The debate on the issue of the disconnected relationship between exchange rates and exports has risen in recent years, with the growing trend of Global Value Chain (GVC)-related trade assumed to be the source of the weakening link between them. By employing manufacturing industry-specific data, this study aims to investigate the impact of GVC on the nexus of the Real Effective Exchange Rate (REER) and exports in four ASEAN countries. The estimations are conducted using Least Square Dummy Variable (LSDV) regression for the sample period from 2009 to 2015. The findings of this study suggest that for the Philippines, the coefficients of exchange rate elasticity of export and participation to GVC are not statistically significant. Conversely, in the case of Indonesia and Malaysia, integration to GVC, with various measurements, will reduce the REER elasticity of exports by around 70% to 89% on average. Furthermore, the estimation data on Thailand and a group of four countries implies that the presence of GVC changes both the value and the sign of REER elasticity of exports. Keywords: Export, Exchange Rates, Global Value Chain JEL Classification: F14, F15, F31

scholarly journals Does Trade Policy Impact Food and Agriculture Global Value Chain Participation of Sub‐Saharan African Countries?

2018 ◽  
Vol 101 (3) ◽  
pp. 773-789 ◽  
Author(s):  
Jean Balié ◽  
Davide Del Prete ◽  
Emiliano Magrini ◽  
Pierluigi Montalbano ◽  
Silvia Nenci
Keyword(s):  
Trade Policy ◽  
Value Chain ◽  
Policy Impact ◽  
Global Value Chain ◽  
African Countries ◽  
Food And Agriculture ◽  
Sub Saharan

scholarly journals The Role of Macroeconomic Stability in Current Account Balances

2021 ◽  
Author(s):  
Murat Cetrez ◽  
Yasin Baris Altayligil
Keyword(s):  
Developing Countries ◽  
Current Account ◽  
Inflation Rate ◽  
African Countries ◽  
Significant Relationships ◽  
Fiscal Balance ◽  
First Time ◽  
Current Account Balances ◽  
Macroeconomic Stability

Abstract The role of macroeconomic stability in current account balances has not been studied with a calculated index in the literature until now. It is aimed to find out the role of macroeconomic stability in current account balances for the first time in the study. The analysis is completed for the period between 1980 and 2016 for 97 countries. The macroeconomic stability is represented by an index which is created with inflation rate, growth rate, unemployment rate and fiscal balance data of all the countries. It is found out that the macroeconomic stability is one of the important determinants of current account balances like institutional quality and financial development. It has a negative and statistically significant relationships with current account balances for four different country groups which are developing countries, all countries except industrial, all countries except industrial and African countries, and all countries. Results show that the macroeconomic stability is especially important for the developing countries rather than high income countries.

scholarly journals The global value chain dimension of foreign direct investment flows in the agro-industrial sector of South Africa, 2003–2014

2018 ◽  
Vol 18 (1) ◽  
Author(s):  
Henri Bezuidenhout ◽  
Sonja Grater ◽  
Ewert P.J. Kleynhans
Keyword(s):  
South Africa ◽  
Foreign Direct Investment ◽  
South African ◽  
Value Chain ◽  
Direct Investment ◽  
The United States ◽  
Industrial Sector ◽  
Value Chains ◽  
Global Value Chain ◽  
African Countries

Orientation: African countries offer many investment opportunities and also urgently need global investment finance. Along the value chains of the agro-industrial sector there are many global challenges for African countries to attract foreign direct investment. This article investigates the investment flows in agro-industries and products to and from South Africa.Research purpose: This study evaluates the nature and dimensions of the agro-industrial sector that receive investment inflows in South Africa, as well as investigating South African investment patterns into Africa.Motivation for the study: Of particular interest is the relationship between foreign direct investment (FDI) flows, their integration into global value chains and sustainable investment options.Research design, approach and method: Qualitative data and visual techniques using available data for the period 2003–2014 disambiguate the linkages in FDI patterns with regard to regions, industries and specific companies. Flows between regions and the specific companies are identified and studied.Main findings: The results indicate that the United States, the United Kingdom and the Netherlands are the largest investors in South Africa, with a strong focus on agricultural input production and subsequent agro-processing industries. South African investment into Africa follows a similar, albeit narrower and more focused, pattern. The study concludes that foreign multinational enterprises are actively involved in global value chain expansion and South African firms are following suit.Practical/managerial implications: The lack of FDI in actual agricultural crop production in Africa offers future investment opportunities.Contribution/value-add: This study creates a better understanding of how FDI in agriculture is linked to the development of regional value chains in the Southern African region. The methodology applies a novel approach to an important field of study, of which little knowledge exists, and may contribute to the creation of wealth in the countries of the region and the welfare of its population.

scholarly journals Challenges of Manufacturing Sub-Sector to Compete in Foreign Markets: The Nigerian Experience

2019 ◽  
Vol 4 (5) ◽  
Author(s):  
Sunday Ewah ◽  
Monica P. Lebo
Keyword(s):  
Time Series Data ◽  
Manufacturing Sector ◽  
Trade Openness ◽  
Empirical Work ◽  
Least Square ◽  
Series Data ◽  
Current Account Balance ◽  
Foreign Markets ◽  
Development Indicator ◽  
The Right

This research is an empirical work that focused on the challenges bedeviling the manufacturing sub-sector ability to produce products that can compete with other brands in foreign markets. The data for the study were generated from central bank of Nigeria (CBN) and world bank development indicator (WBDI) of various years. The ordinary least square (OLS) econometric technique was used on time series data of important variables of manufacturing output, trade openness and current account balance. To guide the study it was hypothesized that institutional framework and government policy towards trade liberation encourages investment overtures. The findings of the study showed that trade openness and financial support significantly influence the performance of manufacturing sub-sector to produce goods for foreign markets even though the contribution of the Nigeria manufacturing sector is quite negligible. In conclusion the study recommended that the right investment induced policies and programmes should be put in place in order to ginger investment interest and supply both domestic and foreign markets with products that compete with other brands in the global markets.

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