ASEAN-FTA IMPACT ON RUBBER AND CRUDE PALM OIL EXPORT: AN EMPIRICAL EVIDENCE FROM IMT COUNTRIES

Isnurhadi, Isnurhadi and Bashir, Abdul and Suhel, Suhel (2022) ASEAN-FTA IMPACT ON RUBBER AND CRUDE PALM OIL EXPORT: AN EMPIRICAL EVIDENCE FROM IMT COUNTRIES. Integrated Journal of Business and Economics, 7 (1). pp. 325-339. ISSN 2549-5933

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Abstract

This study uses a gravity model to explore whether the formation and agreement of the ASEAN Free Trade Area (AFTA) has an impact on increasing trade exports of rubber and crude palm oil commodities in the case of ASEAN member countries, namely Indonesia-Malaysia-Thailand (IMT). Using time series data sourced from the United Nations Comtrade database, first for Indonesia using the 1996-2017 period with 21 trading partner countries for crude palm oil (CPO) commodities and 22 countries for rubber commodities. Second, the Malaysian CPO export model uses data for 1997-2017 with 23 trading partner countries. Third, the Thai rubber export model uses the 1999-2017 period with 16 trading partner countries. We find that the implementation of AFTA has had an insignificant impact on Indonesia's rubber and CPO exports, this implies that AFTA has not been fully profitable for Indonesian exports due to a slowdown in trade liberalization. Meanwhile, AFTA has had a positive and significant impact on Thailand's rubber exports and Malaysian CPO, both countries are still relatively slightly better off due to the AFTA agreement. The results of this study also show that the three countries trade these two commodities more intensely to non-ASEAN countries.

Item Type:	Article
Uncontrolled Keywords:	AFTA, Crude Palm Oil, Export, Gravity Model, Rubber
Subjects:	H Social Sciences > HB Economic Theory > HB1-3840 Economic theory. Demography
Divisions:	01-Faculty of Economics > 60201-Development Economics (S1)
Depositing User:	Dr Suhel Suhel
Date Deposited:	27 Apr 2023 05:15
Last Modified:	27 Apr 2023 05:15
URI:	http://repository.unsri.ac.id/id/eprint/96711

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