Gravity Analysis: Potential of Trade (Export) for Ecuador in CSG Products in 2010

We use the estimated equation of the gravity model to predict the values of imports (log). If the actual imported values of CSG exceed the fitted values, we call it import potential for the importing country or export potential for the Exporting Country. We get the following results. The first column depicts the import potential of the reporter or the importing country (second column) or the export potential of the exporting country (third column and is Ecuador). Positive values mean positive export potential (for exporters-Ecuador) or import potential (for importers). Ecuador seems to have positive export potential for CSG products with respect to Bolivia, Chile, Colombia, Peru and Singapore. The export potential with respect to its four Latin American Partners works out to be 34.84 million US $. There is, however, negative potential for exports of CSG to all its Latin American partners taken together (Argentina, Bolivia, Brazil, Chile, Columbia, Paraguay, Peru and Venezuela of the tune of negative 4.9 million. This is because of high negative potential with respect to Venezuela, Argentina and Brazil. These countries may be are more inclined towards exporting the CSG products to Ecuador rather than importing it. SMART analysis had shown that it is more beneficial for Ecuador to liberalize its trade with the China, Japan and the US. Both Ecuador and the trading partners China, Japan and the US gain by such a move. The next table (next section) confirms the same. There is lot of potential gains (for both Exporters and for Ecuador importing the CSG product) if Ecuador liberalizes its trade with the China, Japan, the US and the EU.

-1835.84

Argentina

ecu

487.7235

Bolivia

ecu

-4150.26

Brazil

ecu

-862.018

Canada

ecu

2383.047

Chile

ecu

-438.082

China

ecu

10977.05

Colombia

ecu

-15.03

Hong Kong ecu

-95.0325

Korea, Rep

.ecu

-1573.93

Mexico

ecu

-9.45748

Paraguay

ecu

20942.54

Peru

ecu

94.40047

Singapore

ecu

-2395.8

United Sta1

ecu

-78399.1

Venezuela

ecu

Reviews is used for regression analysis

Gravity Analysis: Export Potential in CSG for Other Countries targeting Ecuador

The export potential for China, Japan and the US works out to be 95 million US $ in CSG. The export potential of the Latin American partners( Columbia, Argentina, Brazil, Paraguay, Uruguay, Chile, Peru, Bolivia and Venezuela) works out to be little more than 13 million US $. This confirms the SMART results earlier that for Ecuador, it is more beneficial for Ecuador to liberalize its CSG trade with the China, Japan, the US and EU27 rather than with MERCOSUR countries. There are more gains for both Ecuador and its trading partners if its liberalizes its trade of CSG with the most efficient suppliers of CSG products, the Japan, the China, EU27 and the US.

3129.998

ecu Argentina

57.94174

ecu

Austria

305.8984

ecu

Belgium

25.1797

ecu

Bolivia

14S01.Se

ecu

Brazil

-12.6218

ecu

Bulgaria

-3734.29

ecu

Canada

2276.634

ecu

Chile

490S6.S3

ecu

China

-7397.7 |ecu

Colombia

-1.05194

ecu

Cyprus

-181.126

ecu

Czech

85.81275

ecu

Denmark

4131.618

ecu

Finland

-1660.14

ecu

France

5637.105

ecu

Germany

-341.035

ecu

Greece

691.6041

ecu

Hong Kong,

-26.2943

ecu

Hungary

295.5748

ecu

India

404.8591

ecu

Indonesia

-402.86 |ecu

Ire land

8499.415

ecu

Italy

2646.389

ecu

Japan

852.4722

ecu

Korea, Rep

2.236048

ecu

Latvia

-2.75789

ecu

Lithuania

-26.3791

ecu

Luxembourg

920.0683

ecu

Malaysia

1908.015

ecu

Mexico

250.0459

ecu

Nederland

3.225574

ecu

Paraguay

1.957566

ecu

Peru

-395.719

ecu

Poland

-467.575

ecu

Portuga1

211.124

ecu

Romania

1376.677

ecu

Singapore

-38.9377

ecu

Slovak Rep

1.568218

ecu

Slovenia

2596.047

ecu

Spain

1058.544

ecu

Swede n

291.8869

ecu

Thailand

-521.268

ecu

United King

44045.36

ecu

United Stat

182.4031

ecu

Uruguay

2.237917

ecu Venezuela

-14.105 |ecu |Vietnam

 
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