Regional Blocs and Agricultural Trade Flow: The Case of ASEAN

Abstract

The direction of the agricultural trade flow compared with the total trade flow can exhibit different patterns. In this study, total and agricultural trade flows for Indonesia, Malaysia, Philippines, and Thailand were examined employing a gravity model and utilizing cross section data. The results show that income and population are significant and positive in all cases while ASEAN has a facilitating impact on the agricultural trade flow in general. Although the distance variable is negative and significant for total trade flow, it is not significant in some cases for the agricultural trade flow. Given the fact that the population has a tendency to increase and income rises with the process of globalization, increasing trade flow can be expected in the region over time. Trade facilitating measures such as harmonization of regulations and an appropriate marketing mix towards partner countries will increase the trade flow in the region.

The impacts of economic globalization on agricultural value added in developing countries

“…Although on a smaller regional scale, this enhances the trade network between countries to increase economic growth [ 135 ]. Competition between member countries in interregional has proven to make products more competitive due to the emergence of diversified and processed agricultural products [ 136 ]. This is also to diversify the market and not only depend on specific export destination countries [ 94 ]; and fourthly , creating a conducive economic system, especially the effective rule of law, political stability, regulatory quality and control on corruption [ 117 , 126 ].…”

Does Turkey's integration into the European Union boost its agricultural exports?

“…Other than theoretical studies cited above there have been some studies attempting to establish the theoretical foundations of such models (Eaton & Kortum, 1997; Helpman & Krugman, 1985). On the other hand, some other studies have examined agricultural trade flow (Atici & Guloglu, 2006; Atici & Furuya, 2008; Cho, Sheldon, & McCorriston, 2002; Furtan & van Melle, 2004; Sanz & Gil, 2001).…”

“…Brada and Mendez (1983), on the other hand, found that the population of home and partner countries had a positive impact on trade flow. In addition, a study examining the agricultural trade flow from Spain to the EU (Sanz & Gil, 2001), and another study examining the agricultural trade flow in ASEAN (Association of South East Asian Nations) members (Atici & Furuya, 2008), found that the population of home and partner countries has a positive impact on the flow of agricultural exports. The distance between two partners determines the transportation cost and negatively affects the trade flow.…”

The Evolution of the Energy Import Dependence Network and Its Influencing Factors: Taking Countries and Regions Along the Belt and Road as an Example

“…For example, Caporale et al (2009) focused on FTAs between the European Union and the Central and Eastern European countries and found a positive and significant impact of FTAs on trade flows. Atici and Furuya (2008) verified the significant impact of the trade agreements among the Association of Southeast Asian Nations on agricultural trade flows between Indonesia, Malaysia, the Philippines and Taiwan. Thus, the signing of FTAs among countries can promote the trade flow of products among countries.…”