Australian Exports of Dairy Products

Abstract

Exports of dairy products are becoming increasingly important in terms of export earnings for Australia. The industry is the fourth highest foreign exchange earner compared to all Australia's food exports. However, Australian exports of dairy products account for about 67 per cent of the total Australian production of dairy products, and about 13 per cent of total world exports of dairy products. About 68 per cent of Australian dairy products exports are sold on Asian markets. The purpose of this paper is to examine the challenging issues and opportunities for Australian exports of dairy products on world markets and to identify potential and emerging export markets for Australian dairy products. Australia is highly restricted on its access to world dairy product markets by the impact of export subsidies and other trade barriers of overseas markets. The current economic and political crises in Asia are also not favourable to maintain export sales on some of the Asian markets. The export support scheme in Australia has made exporting attractive relative to domestic sales. But it is anticipated that the termination of the scheme after June 2000, will reduce production and exports by 6 and 20 per cent, respectively in the short run. However, in the long run, resources will be efficiently used without government intervention and Australian dairy products will also be competitive on the domestic market. There is scope for greater market opportunities in the emerging markets in Asia and other parts of the world for Australian dairy products. Australia will also benefit from the agreement on international trade that directs exporting countries to reduce export subsidy and remove nontariff trade barriers on exports of dairy products. Australia should implement appropriate measures to inaease the milk yield per cow, to improve the quality of dairy products and to identify the need for market promotion and research in order to increase the volume of dairy product exports on world markets, especially in Asia and other potential markets such as Middle East, Africa, Europe and the Americas.     

Export Market for Australian Beef Industry

Abstract

The aims of this paper are to examine the constraints and potentials for Australian beef industry on world export markets, and to identify the implications for other beef exporting countries. The survey of beef export constraints suggested that the effect of world beef price and cost of feed grains reduced beef export returns. The relative importance of these variables was tested using a linear regression model. The coefficients of these variables are statistically significant at 10 and 1 per cent levels, and the results suggest that world beef price and cost of feed grains are important determinants of Australian beef exports. The findings of this study also reveal that Australia is highly restricted in its access to world beef markets by the impact of rigid import controls, tariffs and other trade barriers including export subsidies provided by foreign countries for their own exports. Australia needs to give priority to diversification of export markets, particularly in the emerging markets in Africa, Asia, the Americas and the Middle East, where reduced tariff barriers are expected to improve market access. Australia also needs to increase productivity, improve cost efficiency, and undertake market research and promotion in order to be more competitive in the long run and to capture a sizeable market share from its major competitors.     

Export Credit Guarantees and Export Performance: An Empirical Analysis for Germany

Recent literature finds that exporters are particularly vulnerable to financial market frictions. As a consequence, exports may be lower than their efficient levels. For this reason, many countries support exporters by underwriting export credit guarantees. The empirical evidence on the effects of those policies is, however, very limited. In this paper, we use sectoral data on export credit guarantees issued by the German government. We investigate whether those guarantees indeed do increase exports and whether they remedy the export‐restricting effect of credit market imperfections both on the sectoral and on the export‐market levels. Exploiting the sectoral structure of a rich three‐way panel data set of German exports, we control for unobserved heterogeneity on the country‐year, sector‐year and country‐sector dimensions. We document a robust export‐increasing effect of guarantees. There is some evidence that the effect is larger for export markets with poor financial institutions and in sectors that rely more on external finance.     

Microdynamics of Turkey's Export Boom in the 2000s

This paper examines the microdynamics behind the dramatic export boom experienced by Turkey during the 2000s. Using disaggregated exporter‐level customs data covering the universe of export transactions for Turkey during the period 2002–11, we characterise firm‐level dynamics in the export sector and we decompose export growth at the aggregate, sectoral and destination market levels to identify the role of firm turnover, destination turnover and product turnover. We show that year‐to‐year aggregate export growth is dominated by growth in continuous exporters, and for these, growth is dominated by exports to their continued destinations and of their continued products. However, the observed high degree of churning across firms, destinations and products accounts for a substantial part of Turkey's export growth over longer periods. The patterns of microdynamics of export growth are verified across sectors and across groups of destination markets with some exceptions regarding exports to new emerging markets where net exporter entry plays a more critical role for export growth over longer periods.     

Australian Meat Industry

Abstract

Australian exports of meat account for about 46 per cent of the total Australian production of meat, and 19 per cent of total world exports of meat. About 52 and 33 per cent of Australian meat exports are sold on Asian and the American markets, respectively. However, Australia is highly restricted in its access to world meat markets by the impact of export subsidies and other trade barriers. The economic and political problems including rigid import controls are barriers to maintaining export sales on some of Australia's traditional Asian markets. The improvement in tariff barriers in Asia, the Americas and other emerging markets is expected to provide improved market access and opportunities for Australian meat. Higher processing and transportation costs beyond the farm gate also contribute to Australia's less competitiveness on world export markets. Australia should, therefore, implement appropriate measures to increase productivity, improve cost efficiency beyond the farm gate and undertake market research and promotion in order to be more competitive in the long run and to capture a sizeable market share from its major global competitors.     

Geographic Concentration and China's Agricultural Export Instability

This paper investigates the impacts of geographic concentration on China's agricultural export instability with a multiple‐region variance decomposition approach. The decomposition results suggest that China's agricultural export concentration into the Japanese market greatly lowers agricultural export instability, while concentration into the Hong Kong, South Korea, ASEAN, the US, and Russian Federation markets increases export instability. China's exports to the EU also lower its agricultural export instability. Further decomposition results indicate that the impacts of geographic concentration on different agricultural product export instabilities are different.     

China's exports,export tax rebates and exchange rate policy

This paper examines the relationship between China's exports, export tax rebates and exchange rate policy. It offers an explanation for why China's exports continued to rise under RMB real appreciations during the Asian financial crisis. Based on a traditional export demand model, we test our hypothesis that the counteracting effects of China's export tax rebate policy have diminished the effectiveness of real exchange rates in facilitating the resolution of trade imbalances under the current pegged exchange rate regime. We find evidence that RMB real appreciations during the crisis negatively affected China's exports, but the negative effects were mitigated by the positive effects of export tax rebates. We also find evidence of a long‐run relationship between China's exports and the other explanatory variables. The empirical evidence suggests that under the pegged exchange rate regime with limited adjustments, real exchange rate movements alone cannot resolve China's external imbalances. The policy implication of this study is that China needs to redirect its decades‐long export‐oriented development strategy to one that emphasises domestic demand‐oriented development and to replace the current pegged exchange rate regime with a market‐oriented more flexible exchange rate regime.     

Firm-level export duration: The importance of market-specific ownership linkages

This paper explores the impact of a firm's market-specific ownership linkages and trade complementarities on different dimensions of its exporting longevity. Unlike previous studies that were mostly based on country-product-level data, this paper uses transaction-level trade data on the population of firms in Slovenia in the 2002–11 period, matched with detailed origin/direction of inward/outward FDI information to determine a firm's integration in international production networks. Our results indicate that firm's bilateral inward and outward FDI flows with an export-destination country have a strong positive effect on a firm's export survival in that market. Importance of market-specific ownership linkages for export duration is exclusively driven by intermediate goods which suggests prolonged export duration through production network involvement. However, the perseverance effect of bilateral FDI ties on export spells has been weakened during the crisis period. We find pronounced market- and product-related trade complementarities as either exporting or importing experience with the relevant market/product substantially improves the chances of a product–market export spell continuing. Finally, the risk of exports termination is lower for a firm's core export products.     

EU Enlargement and the Portuguese Economy

The main focus of the present paper is on the emerging and likely future trade effects of enlargement. Though our particular concern is with Portugal, we set the scene by comparing the trade structures of the 10 countries of Central and Eastern Europe (i.e. the eight CEE accession states plus Bulgaria and Romania) – including an analysis of the individual cases of the Czech Republic, Hungary and Poland – with those of the EU15 as a whole, and with those of the 4 EU cohesion countries. The elimination of trade barriers between incumbents and accession states will have two trade‐related effects on EU incumbents: an increase in bilateral flows with the CEEC and a shift effect as the CEEC displace some incumbent exports to EU markets. The first effect is likely to be strongest for those incumbents for which there is a strong overlap between their export structure and the import structure of the CEEC. Portugal emerges as one of the economies with the least overlap. The displacement effect, we conclude, is likely to be particularly strong in the case of Portugal, given the high degree of similarity between Portuguese exports and those of the CEEC. Portugal appears to be ‘being squeezed from below’ in that, for the majority of its traditional export sectors, the CEEC became progressively more competitive during the second half of the 1990's. Portuguese specialisation was increasingly confined to low‐technology, low‐added‐value sectors with declining demand, as strong FDI inflows to the CEEC led to an increasing preponderance of more dynamic sectors in their export structures. Thus, Portugal is also being squeezed from above. This suggests that there may be substantial industrial disruption, in response to which labour‐market flexibility and dynamic entrepreneurial response is crucial. Intersectoral mobility is generally easier the more highly educated the workforce – an indicator on which Portugal scores poorly. The Portuguese labour market, however, displays a high degree of flexibility, consistent with its long lasting low rate of unemployment. Continued flexibility will help minimise these likely adjustment costs. Besides the trade and industry effects, other topics considered in the paper include the implications of enlargement for Portugal's ability to attract FDI, the likely consequences for Portugal of inward migration from the CEEC to the EU, and the implications of enlargement for Portugal's budgetary relations with the rest of the EU.     

Market knowledge: Evidence from importers

Previous firm‐level literature established that there are substantial costs of entry into new export markets. Chaney (The American Economic Review, 104, 2014, 3600) opens the black‐box of entry costs by building a dynamic network model of international trade where firms acquire customers in new destinations through their existing customers in other destinations. Following his conjecture, this paper examines whether firms use their existing suppliers in a destination to find their first clients in those markets. I use a disaggregated data set on Turkish firms' exports and imports for the 2003–08 period, and investigate the effect of import experience on export entry. By identifying import experience using instrumental variables, and shutting down productivity channels with firm‐year fixed effects, I find that having a supplier in the destination country raises the probability of starting to export to that country by 5.5 percentage points on average, revealing a “market knowledge” phenomenon. The paper's main contribution to the literature is finding that firms' country‐specific import experience increases the likelihood of export‐market entry. Digging further to explore heterogeneous effects, I find that this effect does not exist when trading with low‐income countries, but it increases with the destination country's size, proximity, language similarity and the size of its Turkish immigrant community. Moreover, the strength of the firm's relationship with its supplier as proxied by several variables such as the share of imported products that are differentiated increases the probability of export‐market entry.     

Drivers of Export Demand: A Focus on the GIIPS Countries

This study investigates the drivers of export demand in the peripheral economies of the Euro Area, namely Greece, Ireland, Italy, Portugal, and Spain (GIIPS), for the period between 1980 and 2012. Recently, several authors have pointed out that changes in trade export shares are not associated with major terms of trade disturbances; rather, they are the result of other underlying factors commonly defined as ‘non‐price competitiveness’. Starting from this premise, the study extends the traditional imperfect substitute trade model to include a measure of non‐price competitiveness: real capital stock. The latter is a measure of a country's total resource base and captures the presence of product differentiation and product innovation. The results show a significant link between export demand and cumulative investments. In the short‐term, GIIPS exports are dominated by the movements of worldwide real income, while changes in price and non‐competitiveness take longer to affect export performance. In the long‐run, all three variables play a significant role in pushing exports.     

European Union Market Access Conditions and Africa's Extensive Margin of Food Trade

This paper examines the impact of two European Union (EU) market access regulations in the food sector presumed to simultaneously affect firms’ decisions to export food products to the EU. We analysed EU pesticide standards on African exports alongside a complementary non‐tariff measure in the form of a minimum entry price regulation, which aims to protect EU growers of certain fruits and vegetables against international competition. Analysis was based on Africa's exports of tomatoes, oranges, and lime and lemon to the EU between 2008 and 2013, using the gravity model of trade. Our results show that EU market access conditions constitute significant barrier to the formation of new trade relation between the EU and Africa. In addition, initiation of trade relationships is contingent not only on market access conditions but also on domestic market constraints in Africa. These results imply that negotiating preferential entry prices duties and the removal of domestic market restraints as well as strengthening domestic capacity to comply with EU standards to enhance continuous market access for the continent could stimulate food trade along the extensive margin.     

Credit constraints, equity market liberalizations and international trade

This paper provides evidence that credit constraints are an important determinant of international trade flows. I exploit shocks to the availability of external finance and examine the impact of equity market liberalizations on the export behavior of 91 countries in the 1980-1997 period. I show that liberalizations increase exports disproportionately more in financially vulnerable sectors that require more outside finance or employ fewer collateralizable assets. This result is not driven by cross-country differences in factor endowments and is independent of simultaneous trade policy reforms. Moreover, it obtains with equal strength in the full panel of countries as well as in both panel and event-study analyses of countries which removed capital controls during the sample period. Finally, the effects of liberalizations are more pronounced in economies with initially less active stock markets, indicating that foreign equity flows may substitute for an underdeveloped domestic financial system. Similarly, opening equity markets has a greater impact in the presence of higher trade costs caused by restrictive trade policies.     

The relationship between trade openness and economic growth: Some new insights on the openness measurement issue

Empirical results on the links between trade openness and economic growth often suggest that, in the long run, more outward‐oriented countries register better economic growth. However, a similar level of trade openness can hide different types of trade structures. The aim of this paper was to enrich the way of measuring trade openness taking into account two different dimensions of countries’ integration in world trade: export quality and export variety. Based on the estimation of an endogenous growth model on a panel of 169 countries between 1988 and 2014 using a generalised method of moments estimator, our results confirm that countries exporting higher quality products and new varieties grow more rapidly. More importantly, we find a non‐linear pattern between the export ratio and the quality of the export basket, suggesting that openness to trade may impact growth negatively for countries which are specialised in low‐quality products. A non‐linear relationship between export variety, the export ratio and growth is also found, suggesting that countries increasing their exports will grow more rapidly after reaching a certain degree of the extensive margin of exports.     

新冠肺炎疫情下我国农产品出口变化分析

近年来我国农产品出口总体呈上升趋势,水产品、蔬菜、果类及制品是优势出口农产品,且优势农产品出口目标市场稳定。受新冠肺炎疫情影响,我国农产品出口发生了一系列变化,出口额总体有所下降,水产品出口下降幅度较大,蔬菜出口量增价跌。提出稳定贸易基础,打通贸易渠道,拓展农产品出口市场,加大金融支持,扩大承保范围,企业加快转型升级等对策建议。     

Growth and Trade vs. Trade and Growth

In the traditional trade literature, there is a well-developed area analyzing the effect of growth on trade and its reflection on income growth. This literature developed already in the 1950s and 1960s. Generally speaking, an interest in the effects of trade on growth has also existed for many years, where trade has often been viewed as an engine of growth. Cases in point are the "East Asian Tigers" and Japan which have especially benefited from outward-looking policies. In this paper, we analyze the relationship between economic growth and growth in income terms of trade, arguing that income terms of trade is a useful concept in analyses of the link between trade and growth. Our results suggest that fast-growing countries have either specialized in sectors with a relatively favorable development with regard to world market prices, or they have managed to successively improve quality within sectors, thereby avoiding falling terms of trade in spite of large increases in export volumes.     

What Drives India's Surge in Service Exports?

India's prowess in the service sector has been recognised the world over. Sustaining services exports is important not only to sustain India's high growth rate but also to compensate for a consistent deficit in merchandise trade and to maintain stability on the external sector. In this context, we analyse the factors of India's performance in services exports over the past three decades. The results reveal that endowment factors such as human capital, improvement in physical infrastructure and financial development are key drivers for India's surge in services exports along with world demand, exchange rate and manufacturing exports. While factors such as institutions, R&D expenditure, telecommunication, foreign direct investment and financial development significantly impact the export of modern services, traditional services exports are more dependent on infrastructure development, manufacturing exports, world demand and exchange rate. India's economic reforms in the financial sector, FDI, communication so far have helped the services exports, but India needs to focus on supply‐side factors to improve the competitiveness – and thereby volume – of services exports.     

DOES HYSTERESIS OCCUR IN TRADE? SOME EVIDENCE FOR BILATERAL EXPORT FLOWS AT A DISAGGREGATED LEVEL

This article shows that hysteresis effects can be specific to certain commodities and/or to trade with particular countries. We perform two tests to investigate two different implications of the hysteresis hypothesis. The first implication is that the relative price elasticity of demand for exports rises when a market becomes more competitive. The second implication is that relative export prices are insensitive to changes in the exporter's relative exchange rate. We find that hysteresis is not an insignificant phenomenon for some specific goods. Out of 14 products we can accept Baldwin's hysteresis hypothesis for three: manufacture of drugs and medicines, manufacture of office computing and accounting machinery, and manufacture of radio, television, and communication equipment. These are sectors with higher than average sunk costs in terms of advertising expenditure.     

后金融危机时期黑龙江出口企业的发展对策

由于国际金融危机致使世界贸易明显下滑,中国产品出口也受到了冲击。随着各国政府采取的经济刺激政策逐步取得成效,许多国家经济指标正在逐步企稳,这预示着世界经济逐步进入"后危机时期",也意味着全球经济复苏已为时不远,产品出口将迎来新的发展时期,这将给包括黑龙江省在内的中国出口企业带来新的发展机会。因此,黑龙江产品出口营销企业应充分认清形势,做好充分准备,蓄势待发,以迎接产品出口稳步发展的新的历史时期的到来。