Sri Indah Nikensari

Department of Economics, Universitas Negeri Jakarta,

Indonesia

indah_nikensari@unj.ac.id

ORCID 0000-0002-0413-655X

Determinants of world trade stagnation in three regions

Nindya Farah D Puspitasari

Department of Accounting, Universitas Terbuka,

Indonesia

nindyafarah@ecampus.ut.ac.id

ORCID 0000-0001-9327-2045

Andryan Setyadharma

Department of Economics, Universitas Negeri Semarang,

Indonesia

andryan@mail.unnes.ac.id

ORCID 0000-0002-7248-7925

Nirdukita Ratnawati

Department of Economics, Universitas Trisakti,

Indonesia

nirdukita08@gmail.com

ORCID 0000-0002-1053-9339

Abstract. Sharp decline in the world trade occurred again, after in 2018 it had increased, not least in the countries of free trade areas. This empirical study aims to map and compare the factors that influence export and import performance in the regions of Southeast Asia (AFTA), Europe (EEA), and Latin America (LAIA) before the Covid-19 pandemic crisis. The data has been collected from various sources of both official and private institutions for the time period of 2011-2019. Multiple regression analysis of panel data is used to provide greater and more informative observations and reduce the collinearity of the independent variables. The results show that the performance of exports and imports in the three regions in question shows a stagnant trend and is likely to decline in 2019, especially in part of exports performance. In all the regions in question, export performance is influenced by strengthening or weakening of the real effective exchange rate (REER) and the number of manufactured products, while import performance is more influenced by GDP per capita and REER too. Several other independent factors were also studied, but they did not affect all the regions under consideration equally. For example, competitiveness rate affected exports in the EEA and LAIA but not in AFTA, while the consumer confidence rate affected imports in AFTA and LAIA but not in the EEA.

Received: May, 2020

1st Revision: March, 2021

Accepted: May, 2021

DOI: 10.14254/2071-8330.2021/14-2/10

JEL Classification: F02, F14, F15, F17, C33, C51

Keywords: international trade, stagnation, free trade area, demand factors, supply factors, exports, imports