Does global financial crisis impact on east asian export

UNIVERSITY OF ECONOMICS INSTITUTE OF SOCIAL STUDIES HO CHIMINHCITY THE HAGUE VIETNAM THE NETHERLANDS VIETNAM - NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS DOES GLOBAL FINANCIAL CRISIS IMPACT ON EAST ASIAN EXPORT? BY TRAN PHAM HOAI TRINH MASTER OF ARTS IN DEVELOPMENT ECONOMICS HO CHI MINH CITY, May 2014 UNIVERSITY OF ECONOMICS INSTITUTE OF SOCIAL STUDIES HO CHIMINHCITY THE HAGUE VIETNAM THE NETHERLANDS VIETNAM - NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS DOES GLOBAL FINANCIAL CRISIS IMPACT ONEAST ASIAN EXPORT? A thesis submitted in partial fulfilment of the requirements for the degree of MASTER OF ARTS IN DEVELOPMENT ECONOMICS By TRAN PHAM HOAI TRINH Academic Supervisor: Dr DINH CONG KHAI HO CHI MINH CITY, May 2014 ACKNOWLEDGEMENT I would like to take this opportunities to send my special thanks to Dr Nguyen Trong Hoai who has inspired initiatives and passion of global financial crisis to me to carry out this interesting study; my sincere gratitude to Dr Dinh Cong Khai for his scientific guidance and invaluable advices, which he has provided throughout the time of preparation and accomplishment of this paper; my thanks to my classmates Anh Thu, Thu Huong, Thuy Thanh and my loved daughters Moon and May who always give me their restless assistance and encouragement when I was in trouble ABSTRACT The global financial crisis in 2008 was initially a single crisis in the US subprime market After very short time, the crisis has quickly escalated and spread its impact to all over the world As stated by UNDP, very quickly through international trade, the crisis has been transmitted from the West to the East This paper aims to find out how this financial crisis impacts the trade of East Asian countries More particularly, this paper tries to find out how, and to what extent, does the global financial crisis impact exports of East Asia By studying the impacts of GDP, financial sector quality (measured by domestic credit), import demand on exports and by observing the change of these impacts before and after the global financial crisis, the effect of the global financial crisis on export will be identified Data of exports, domestic credits and import demands are collected from 2001 to 2010 for countries in East Asia The data is balanced from country to country, then balanced panel data will be used for model testing Moreover, the Hausman test used to test the panel data is significant with fixed effect model The results finally show that the global financial crisis started in 2008 has not changed impact’s magnitudes of GDP, financial sector quality and imports demand on exports of East Asia during crisis Key words: global financial crisis, international production fragmentation, triangular trade network, financial integration TABLE OF CONTENTS CHAPTER 1: INTRODUCTION 1.1 BACKGROUND OF THE STUDY 1.2 PROBLEM STATEMENT 10 1.3 RESEARCH OBJECTIVES 10 1.4 RESEARCH QUESTIONS 11 1.5 RESEARCH METHODOLOGY 11 1.6 OUTLINE OF STRUCTURE 11 CHAPTER 2: LITERATURE REVIEW 13 2.1 LITERATURE REVIEW & EMPIRICAL STUDIES 13 *Impact of economic growth on exports 15 *Impact of financial sector quality on exports 16 *Impact of import demand on exports 17 2.2CONCEPTUAL FRAMEWORK 21 CHAPTER 3: OVERVIEW of EAST ASIAN EXPORTS and FINANCIAL SYSTEM 22 3.1 EAST ASIAN EXPORTS 22 3.2 EAST ASIAN FINANCIAL SYSTEM 26 CHAPTER 4: ECONOMETRIC MODEL and ESTIMATION STRATEGY 29 4.1 ECONOMETRIC MODEL 29 4.2 ESTIMATION STRATEGY 31 4.3 DATA 32 CHAPTER 5: ECONOMETRIC RESULTS and FINDINGS DISCUSSION 36 5.1 DESCRIPTIVE STATISTIC 36 5.2 VARIABLES and CORRELATION MATRIX 43 5.3 EMPIRICAL RESULTS and FINDINGS DISCUSSION 44 CHAPTER 6: POLICY IMPLICATIONS and CONCLUSION 50 6.1 POLICY IMPLICATIONS 50 6.2 CONCLUSION 52 6.3 LIMITATION 53 REFERENCES 55 APPENDIX 59 LIST OF TABLE, CHART & FIGURE Type Title Page Chart China Manufactured export structure 25 Chart Manufactured export composition 26 Chart Cross-border loans during Q4 2007 – Q4 2010 42 Chart Regional consumption goods export performance during crisis 47 Figure International production fragmentation –vertical specialization 18 model Figure The conceptual framework 21 Figure Share of East Asian economies in the value of world exports 22 Figure Triangular trade network structure 23 Figure The rest of East Asia export to China (% of total export) 24 Table East Asia regional exports share in total exports 24 Table Share of intermediate goods in total export 25 from the rest of East Asian countries to China Table List of variables and expected sign of effect 31 Table Growth of total merchandise export (2008Q3-2019Q3: % change) 37 Table East Asian export growth during crisis 38 Table GDP growth 2000-2010 39 Table Growth rate of China’s intermediate goods import from East Asian 40 Vs China’s export to EU & US Table Net foreign assets in domestic banks 41 Table Skewness/Kurtosis test STATA output 43 Table 10 Pairwise test STATA output 43 Table 11 Empirical result 44 Table 12 Variance inflation factor (VIF) 45 Table 13 East Asia regional export composition 46 Table 14 Coefficient comparison 49 Appendix Auxiliary regression results 59 Appendix Hausman test for the sample with China 60 Appendix Hausman test for the sample without China 61 Appendix Full regression result for the sample with China 62 Appendix Full regression result for the sample without China 63 Appendix East Asia regional total exports 64 Appendix East Asia regional intermediate goods exports 66 CHAPTER INTRODUCTION The first chapter consists of six parts to introduce the general issues of the study The first part provides the background of the study The second part raises the problem to be addressed The third part presents the research objectives The fourth part sets out the research questions to be answered in this study The fifth part is research methodology and the last part is outline of the study 1.1 Background of the study East Asian countries1 are export-led growth countries Export so far have been the key engine for growth and received many supports from the government for better performance During the recent decades, in this region, China has rapidly increased exports of manufactured products to the US, EU and became a major trade partner with the US, EU The growth of China’s manufacturing export is also supported by the supply of intermediate inputs of other East Asian countries In this way, a trade network was formed between US, EU, China and other East Asian countries This network is called the triangular trade network and soon became a primary growth engine for East Asia (Ando, 2006) It is believed that East Asian countries can maintain regional growth independently based on this network and would not rely heavily on the out-of-region economies’ demand and supply This belief was built up based on the decoupling thesis2 which was raised by many researchers before the US financial crisis However, in fact, when the US financial crisis spreads to East Asia, exports of this region in some ways was affected and East Asian countries in this study includes Japan, China, Indonesia, Korea, Malaysia, The Philippines, Singapore and Thailand 2 Decoupling refers to the phenomenon of a weakening impact of advanced countries’ demand and supply shock on performance of East Asian economies since it’s increasingly independent from global economy development decline significantly (Chul, 2011) So is it true that the US financial crisis impacts exports of East Asian countries and is the decoupling thesis unreal are the questions that I am concerned with 1.2 Problem statement East Asia is the region where export-led growth strategy has boosted the economy since 1960s Exports hold the crucial role and are the key engine for economic development of this region Along with its export-based development, according to the decoupling theses, the increasingly intra-regional trade in East Asia has lightened the impacts of external demand and supply shock on growth and made this region become self-contained development Therefore export downfall in East Asia after 2008 received much attention of researchers in finding how the global financial crisis impacted this region So far, many researches has focused on the impact of the global financial crisis to international trade through trade finance constraint (Chauffour & Malouche, 2011), contraction of global supply chains (Escaith, 2010), and protectionism This research is going to find out the key determining factors of East Asian exports performance and identify if the global financial crisis is able to change the impact’s magnitude of these factors on exports of East Asia Through these findings we can answer the question of whether the global financial crisis had impacted on exports of East Asian countries 1.3 Research objectives  The overall objective: The overall objective of this research is to understand whether the global financial crisis impacts exports of East Asian countries  The specific objective: This research aims to identify impacts on exports of GDP, financial sector quality and import demands Then, by observing the changes of these effects when the global financial crisis occurs, impact of global financial crisis on East Asian exports will be clarified 10 final goods demand and the world demand significantly influence exports performance, especially the regional intermediate goods demand During the global financial crisis, most of these determining factors have fallen at the first hit, but then very quickly rebound from resection The intra-regional demand in this region is strong enough to weaken impacts of the contraction of consumption demand, the drying up of trade finance transmitted from developed countries to East Asia The strong dependence on regional demand in the context of increasing participation in the regional triangular trade networks enables exports of this region growth independently from shocks of the global economies The decoupling of East Asia in trade is real This region is expected to be more selfcontained in future with speedy economic integration among regional countries and appropriated free trade agreements and activist fiscal policy 6.3 Limitation Researchers have often use ration of private credit to GDP to measuring financial development For example, Jung Hur and his partners in 2004 used this ratio for the research about impact of financial development and asset tangibility on export Beck (2002) used it for his research of the link between financial development and international trade Recently, Arcand et al (2012) used this ratio to examine if the effect on output growth of financial development vanished when credit to the private sector reaches 100% of GDP Some other empirical evidence on financial system’s role in economic development uses these variations of this measure However, it is commented recently that this ratio does not provide a sufficient basis for assessing financial development For a better measurement, some researchers have compiled and released the Global Financial Development Database (World Bank 2012) It is an available dataset on financial development, containing annual financial-system indicators for more than 200 countries from 1960 to 2011 The Global Financial Development Database is the updated and recalculated of the Financial Development and Structure dataset which is 53 introduced in 2000 The database is being updated with more financial systems, and more data are compiled The Global Financial Development Database uses many indicators to measure the development of financial system These indicators are categorized in four broad categories financial depth, financial access, financial system efficiency and financial system stability The financial depth is measured by the size of financial institutions and markets Financial access is measured by degree to which individuals can use financial services Efficiency of financial system is measured by facilitating financial transactions and the stability is measured by stability of financial institutions and markets All of these four dimensions are measured both for financial institutions and financial markets, such as banks and insurance companies, bond and stock markets If we focus on one characteristic, for example financial efficiency, we would mean missing other important aspects of financial systems The suggestion is to use the indicators of the Global Financial Development Database for further study The research also omits the tariff factor which can bring comparative advantages in intra-regional trade of East Asia This factor would influence on export pattern as well as export performance The suggestion is to add tariff in export model to investigate how tariff support East Asian countries to increase intra-regional trade in final consumption goods, diversify export products and enhance the decoupling of East Asia 54 REFERENCES 01 Ando, M (2006) Fragmentation and Vertical Intra-industry Trade in East Asia The North American Journal of Economics and Finance 17 (2006) 257-281 Retrieved from www.sciencedirect.com 02 Amighini, A ( 2005) China in the international fragmentation of production: evidence from the ICT industry The European Journal of Comparative Economics Vol.2,n.2,pp.203-219 Retrieved from http://eaces.liuc.it 03 Amiti, M., & Weinstein, D.E (2009) Exports and Financial Shocks Center for Economic Policy Research Discussion paper series No.7590 Retrieved from www.cepr.org/pubs/dps/DP5790.asp 04 Arcand, J.L., Berkes, E., & 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Granger Causality Analysis on OECD countries Applied Econometrics and International Development AEEADE Vol 4-1 (2004) Retrieved from www.usc.es/economet/eaa.htm 57 31.Mehrara, M., & Firouzjaee, B.A (2011) Granger Causality Relationship between Export Growth and GDP Growth in Developing Countries: Panel Cointegration Approach International Journal of Humanities and Social Science Vol.1 No.16 November 2011 32 Obashi, A (2008) Stability of Production Networks in East Asia: Duration and Survival of Trade Faculty of Economics, Keio University, Japan 33.Razmi, A., & Hermandez, G (2011) Can Asia Sustain an Export-Led Growth Strategy in the Aftermath of the Global Crisis? An Empirical Exploration ADBI working paper series No.329 Retrieved from www.adbi.org.workingpaper/2011/12/02 34.Redding, S & Venables, A.J (2003) South-East Asian export performance: external market access and internal supply capacity Journal of the Japanese and International Economies 17 (2003) 404-431 doi.1016/j.jjie.2003.09.002 35.Taylor, J.B (2009) The Financial Crisis and The Policy responses: An Empirical Analysis of What Went Wrong National Bureau of Economic Research Working paper 14631 Retrieved from www.nber.org/papers/w14631 Index: 36 Developing countries in International Trade 2005 – Trade and development Index Chapter 2: Determinant of export performance 37 Classification by Broad Economic Categories Department of Economic and Social Affairs Statistics Division Statistical papers series M No.53, Rev.4 58 APPENDIX Appendix 1: Auxiliary regression results R2 Mean VIF GDP = 36.63204 t= (0.93) -0.261901NDC (-3.25) -1.261458lnFGD (-1.85) +3.879901lnIGD (6.98) -3.189072lnWDD (-.179) 0.5116 4.02 NDC= 2097 t= (4.43) -4.70631GDP (-3.25) +53.4373lnFGD (7.64) +6.412287lnIGD (0.67) -119.474lnWDD (-5.94) 0.8149 2.88 lnFGD= -16.94415 -0.347437GDP t= (-2.70) (-1.85) lnIGD= -3784885 t= (-0.59) lnWDD= 21.34844 t= (41.80) +0.0081904NDC +0.6096617lnIGD (7.64) (6.40) +0.8626509lnWDD (3.03) 0.8648 2.33 +0.1015209GDP +0.0009337NDC +0.5791886lnFGD +0.4875982lnWDD (6.98) (0.67) (6.4) (1.69) 0.7788 3.23 -0.128499GDP (-1.79) -0.002679NDC (-5.94) 59 +0.1262022lnFGD +0.750867lnIGD (3.03) (1.69) 0.3695 4.15 Appendix 2: Hausman test for the sample with China (b) fixed Coefficients (B) (b-B) random Difference sart(diag(V_b-V_B) S.E Dum -20.6135 -187.2635 166.65 67.73887 GDP 0.0065001 0.0134641 -0.006964 0.0043244 NDC 0.0007247 -0.0001614 0.0008861 0.002802 lnFGD 0.256527 0.3037484 -0.047221 0.2184962 lnIGD 0.4904175 0.7587227 -0.268305 0.2434492 lnWDD 0.2765145 -0.3711342 0.6476487 0.278285 DumGDP -0.0000921 0.1962671 -0.196359 0.0660991 DumNDC 0000368 0005898 -0.000553 0.0007496 DumFGD -.043372 9286575 -0.97203 0.343465 DumIGD 1759848 -.5350221 0.7110069 0.2559511 DumWDD 7411544 7.406739 -6.665585 2.714899 b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg Test: Ho: difference in coefficients not systematic chi2(4) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 35.86 Prob>chi2 = 0.0000 60 Appendix 3: Hausman test for the sample without China Coefficients (b) (B) (b-B) fixed random Difference sart(diag(V_bV_B) S.E Dum -399.021 -330.337 -68.6841 180.7349 GDP 0.006268 0.006811 -0.00054 0.003702 NDC 0.000624 -0.00039 0.001011 0.002864 lnFGD 0.022696 0.487199 -0.4645 0.225097 lnIGD 0.567593 0.406151 0.161442 0.234325 lnWDD 0.492846 -0.05828 0.551129 0.315701 DumGDP 0.09901 0.244146 -0.14514 0.080834 DumNDC 0.003647 0.002211 0.001436 0.001985 DumFGD 0.965686 1.161607 -0.19592 0.580043 DumIGD -0.92533 -0.62113 -0.30421 0.596998 DumWDD 16.31259 13.14683 3.165764 7.433544 b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg Test: Ho: difference in coefficients not systematic chi2(4) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 51.63 Prob>chi2 = 0.0000 61 Appendix 4: Full regression result for the sample with China Fixed-effects (within) regression Number of obs Group variable: panelID Number of groups = R-sq: within = 0.9481 Obs per group: = 10 between = 0.9415 avg = overall = 0.9303 80 10.0 max = F(11,61) = 10 = 101.24 corr(u_i, Xb) = 0.6292 Prob > F = 0.0000 lnEXP Coef Std.Err t P>|t| [95% Conf Interval] Dum -20.613502 80.42149 -0.26 0.799 -181.4262 140.1992 GDP 0.0065001 0.004812 1.35 0.182 -0.0031228 0.016123 NDC 0.0007247 0.001223 0.59 0.556 -0.0017206 0.00317 lnFGD 25652701 0.095396 2.69 0.009 0.0657719 0.4472821 lnIGD 49041745 0.105908 4.63 0.0000 0.2786417 0.7021932 lnWDD 27651447 0.136371 2.03 0.047 0.0038234 0.5492055 DumGDP -0.0000921 0.070137 -0.00 0.999 -0.1403401 0.1401558 DumNDC 0.0000368 0.001356 0.03 0.978 -0.0026749 0.0027486 DumFGD -0.043372 0.3414 -0.13 0.899 -0.7260436 0.6392995 DumIGD 0.1759848 0.2614 0.67 0.503 -0.3467176 0.6986872 DumWDD 0.7411544 3.233065 0.23 0.819 -5.723759 7.206067 _cons 2.368356 -0.21 0.835 -5.230012 4.241628 -0.494192 sigma_u | 33451915 sigma_e | 09509824 rho | 92522596 (fraction of variance due to u_i) F test that all u_i=0: F(7, 61) = 46.33 Prob > F = 0.0000 62 Appendix : Full regression result for the sample without China Fixed-effects (within) regression Number of obs Group variable: panelID Number of groups = R-sq: within = 0.9598 Obs per group: = 10 between = 0.8773 avg = 10.0 max = 10 overall = 0.8276 F(11,52) = 80 = 112.91 corr(u_i, Xb) = 0.6125 Prob > F = 0.0000 lnEXP Coef Std.Err t P>|t| [95% Conf Interval] Dum -399.021 130.7808 -3.05 0.004 -661.452 -136.59 GDP 0.006268 0.003782 1.66 0.104 -0.00132 0.013857 NDC 0.000624 0.001022 0.61 0.544 -0.00143 0.002674 lnFGD 0.022696 0.081794 0.28 0.783 -0.14143 0.186827 lnIGD 0.567593 0.088482 6.41 0.000 0.390041 0.745145 lnWDD 0.492846 0.124921 3.95 0.000 0.242175 0.743518 DumGDP 0.09901 0.063516 1.56 0.125 -0.02844 0.226465 DumNDC 0.003647 0.001548 2.36 0.022 0.000541 0.006753 DumFGD 0.965686 0.419747 2.30 0.025 0.123402 1.80797 DumIGD -0.92533 0.405484 -2.28 0.027 -1.739 -0.11167 DumWDD 16.31259 5.352741 3.05 0.004 5.571529 27.05365 _cons 2.020906 -1.74 0.088 -7.56829 0.542201 -3.51304 sigma_u | 4740099 sigma_e 07362627 rho | 97644206 (fraction of variance due to u_i) F test that all u_i=0: F(6, 52) = 72.56 Prob > F = 0.0000 63 Appendix 5: East Asia regional total exports Year From country/To country 2006 China Indonesia Japan Korea Malaysia Philipines Singapore Thailand 2007 Japan Korea Malaysia Philipines Singapore Thailand Japan Korea Japan Korea Malaysia Philipines Singapore Thailand 8,871,172,886 90,482,236,809 43,974,700,120 13,447,704,414 5,622,125,613 21,816,733,492 9,699,334,158 20,449,313,278 7,458,829,520 3,991,424,687 1,336,022,897 8,150,875,748 2,600,142,955 47,412,288,003 12,218,166,777 8,627,067,922 15,821,023,638 22,016,491,408 4,697,801,267 3,430,114,158 8,018,516,874 4,186,270,501 2,116,691,260 21,153,204,678 8,263,052,942 3,098,156,765 1,249,980,322 85,755,905,258 6,953,956,398 64,241,507,492 3,595,359,718 22,477,037,878 11,280,881,601 3,705,126,770 13,815,059,074 5,559,084,762 4,514,687,138 350,053,455 7,643,911,270 1,397,779,617 2,591,215,373 24,154,613,910 19,786,203,886 13,163,114,177 8,443,532,821 30,037,126,763 3,773,127,762 11,500,235,363 2,964,041,143 15,872,400,735 2,610,153,086 6,446,759,692 2,145,059,712 6,327,185,310 11,778,172,622 100,630,528,590 55,680,941,527 17,661,655,935 7,384,189,432 28,134,060,408 12,003,399,243 22,902,372,709 7,453,017,882 4,914,093,276 1,768,097,021 9,739,257,862 2,979,196,449 50,482,372,736 13,796,815,999 9,030,165,602 16,985,066,714 24,580,191,814 5,516,909,892 3,612,308,958 10,246,178,589 4,456,538,444 2,471,346,579 21,988,128,464 8,405,765,980 2,779,866,009 1,325,367,604 9,565,985,290 10,638,039,442 98,299,977,169 8,403,259,722 76,501,472,450 4,174,612,217 22,829,337,657 15,148,769,945 4,716,388,387 15,650,649,818 6,284,086,071 5,633,243,595 487,149,867 7,284,294,278 1,753,636,315 2,496,903,112 26,238,806,145 21,890,394,148 13,017,270,051 10,094,859,807 32,058,230,473 4,838,385,694 14,284,028,285 4,285,784,265 17,356,057,213 2,862,794,966 7,350,513,893 2,491,597,688 7,816,656,592 16,459,731,926 114,564,484,818 72,763,877,241 21,358,918,656 8,940,702,450 30,901,138,533 15,584,238,496 27,472,018,820 9,049,191,546 6,176,138,532 1,945,795,193 12,079,349,379 3,532,664,584 55,485,841,537 14,881,478,324 9,287,550,497 19,422,067,435 28,388,787,284 5,628,887,281 3,996,689,845 11,747,381,486 5,708,025,757 China Indonesia Indonesia 8,107,348,437 China Indonesia 2008 China 11,630,212,422 109,358,253,653 11,641,905,967 82,725,979,208 5,433,982,386 24,462,798,191 64 11,366,425,243 Malaysia Philipines Singapore Thailand 2009 5,293,711,649 19,280,744,169 7,227,379,329 5,378,492,911 570,153,502 7,676,103,509 2,472,799,337 1,916,537,036 26,767,122,129 24,936,695,218 14,471,513,235 11,272,818,119 31,467,183,213 5,648,183,038 14,894,906,446 5,507,361,343 18,967,193,066 3,541,583,750 8,983,129,750 2,870,866,248 7,190,273,908 13,534,156,873 96,255,947,083 52,799,749,776 19,542,590,424 8,274,224,443 27,872,172,001 13,256,584,328 18,489,501,095 8,094,009,130 6,370,058,986 2,306,816,658 9,898,820,699 3,170,090,372 44,434,494,527 11,504,667,003 7,450,009,021 14,675,194,971 21,256,412,090 4,224,258,315 3,685,143,066 10,316,696,333 4,489,125,537 1,910,207,819 18,736,650,093 8,310,012,025 2,376,538,860 1,157,405,693 China Indonesia Japan Korea Malaysia Philipines Singapore Thailand 2010 13,995,055,141 11,480,865,980 Japan Korea Malaysia Philipines Singapore Thailand 20,213,821,533 8,486,775,048 2,034,641,723 1,426,903,058 12,120,048,589 98,042,062,780 8,686,489,064 81,900,579,172 4,456,340,099 19,510,555,970 18,907,989,151 4,621,488,992 15,298,270,054 5,726,983,776 2,902,238,285 361,076,626 6,208,292,252 1,795,784,907 1,330,092,204 22,637,488,579 19,040,763,432 11,022,148,781 11,647,028,339 24,490,266,442 3,944,094,224 15,351,005,808 4,201,409,862 15,505,062,197 2,716,609,482 6,769,499,225 2,434,551,291 5,744,996,350 20,064,808,121 119,305,013,672 67,848,641,572 23,581,088,100 11,228,137,742 29,033,704,531 19,709,108,531 25,621,313,426 12,353,335,278 8,460,301,030 3,023,329,667 13,038,645,292 4,385,477,233 58,753,556,252 15,976,644,529 10,047,347,061 19,146,846,788 32,892,441,826 5,757,403,486 5,068,951,891 11,620,589,549 6,356,634,583 3,020,032,710 22,458,620,035 10,240,014,045 1,452,416,837 1,430,193,690 China Indonesia 2,525,603,149 15,613,305,521 133,910,334,280 15,079,950,823 109,708,063,815 5,600,782,508 24,660,498,218 24,564,520,568 5,193,848,748 20,066,087,777 7,027,924,269 4,138,764,236 399,088,383 5,990,738,439 1,990,859,543 715,035,724 30,828,624,103 22,626,186,647 15,175,824,478 13,451,204,691 31,159,397,223 5,215,682,829 20,654,251,242 6,334,761,839 19,804,286,406 3,580,775,712 9,182,024,347 3,539,797,210 9,395,023,502 12,032,082,889 6,651,464,783 Source : UNCtadstat 2013 65 Appendix : East Asia regional intermediate goods exports Year From country/To country 2006 China Indonesia Japan Japan Korea Malaysia Philipines Singapore Thailand 5,641,361,297 37,012,163,839 29,221,017,975 7,411,747,009 3,740,081,164 11,859,724,580 6,101,180,708 18,411,985,475 7,088,084,554 3,321,347,622 1,125,480,022 5,657,538,457 2,206,074,540 34,686,896,361 9,669,658,838 6,897,129,124 10,423,639,781 16,985,084,540 3,204,295,375 2,825,945,704 5,921,284,548 3,354,801,238 1,728,140,790 15,805,539,106 6,689,594,919 2,916,582,479 1,079,147,762 7,656,770,107 5,394,406,810 50,935,127,665 2,972,743,282 13,113,367,821 Malaysia 9,379,527,054 2,878,577,329 10,886,290,873 4,853,162,081 Philipines 3,876,824,785 256,218,656 4,944,996,664 1,030,549,509 1,978,565,984 Singapore 19,597,412,806 13,749,138,000 10,341,553,387 7,146,633,056 23,319,124,073 2,788,727,050 8,094,101,892 2,214,158,299 9,034,735,516 1,917,550,098 4,849,754,264 1,560,069,370 4,481,546,998 7,329,719,881 42,634,044,817 38,242,834,585 10,023,973,532 4,806,325,733 13,235,385,590 7,579,453,206 20,794,877,191 7,078,303,835 4,152,714,713 1,508,163,896 7,111,560,714 2,518,237,103 37,980,274,001 10,607,921,853 7,129,653,148 11,271,061,237 19,543,686,007 3,945,786,518 2,883,013,019 6,231,595,486 3,577,984,856 1,975,461,187 16,885,212,151 6,525,007,886 2,337,584,315 1,026,955,358 Thailand China Indonesia 8,893,099,540 7,916,375,238 Japan 75,074,751,799 6,403,815,970 Korea 59,147,526,592 3,276,370,350 15,441,608,266 Malaysia 13,187,295,126 3,721,941,708 12,716,519,557 5,612,508,368 4,382,164,627 310,499,049 4,635,176,067 1,082,849,586 1,694,357,108 21,072,294,199 14,984,914,409 8,894,272,978 8,414,805,187 25,214,982,050 3,778,469,817 9,389,015,139 3,040,102,780 10,275,573,304 2,102,263,135 5,569,529,899 1,695,630,791 5,702,467,833 9,898,450,937 51,506,764,876 50,009,086,341 11,421,840,177 5,719,804,855 14,491,790,239 9,556,147,617 25,088,192,209 8,615,848,403 5,244,421,592 1,600,696,801 9,273,382,012 2,944,438,521 42,146,557,914 11,598,425,718 4,058,995,935 7,289,497,072 3,254,880,973 12,515,321,633 6,363,328,635 22,476,697,441 4,469,736,681 Philipines Singapore Thailand 2008 Indonesia 64,395,325,386 Korea 2007 China China Indonesia 10,902,719,936 Japan 82,809,382,445 64,367,736,711 Korea 8,496,748,559 4,029,783,825 17,206,458,296 66 8,256,489,904 2009 Malaysia 11,482,932,003 4,191,624,147 16,214,162,942 6,642,954,894 Philipines 4,195,951,199 362,221,100 4,896,507,822 1,564,001,294 1,225,136,654 Singapore 21,476,187,476 16,922,268,649 10,570,554,295 9,716,597,724 24,215,568,984 4,367,526,266 Thailand 9,086,515,038 3,939,750,625 11,042,570,092 2,632,224,844 6,443,710,014 1,658,218,939 5,060,403,691 7,785,326,137 35,354,043,788 31,738,082,137 9,153,284,600 4,451,280,166 11,240,776,374 7,307,791,019 16,327,207,371 7,629,434,734 5,470,779,262 1,845,294,380 7,164,614,397 2,648,228,773 35,335,499,379 8,785,257,662 5,744,491,621 9,203,764,979 16,997,686,261 2,906,878,692 2,943,275,372 5,906,210,977 3,264,634,141 1,464,457,108 14,182,464,103 6,143,855,287 2,082,657,524 874,613,591 China Indonesia Japan 15,265,456,489 6,760,062,789 1,737,129,328 1,094,285,368 8,665,133,686 75,989,331,601 6,681,689,655 Korea 59,402,824,627 3,513,479,153 12,695,336,489 Malaysia 16,487,842,262 3,519,390,445 11,910,413,139 5,083,498,574 Philipines 2,003,268,032 266,450,714 3,886,779,500 1,170,240,313 735,925,281 18,226,991,203 12,756,677,009 7,887,629,902 10,343,999,894 18,502,705,068 2,868,375,194 9,401,207,846 3,015,746,021 8,092,443,243 1,893,945,697 4,735,383,352 1,523,017,989 4,023,278,278 10,260,055,978 47,459,370,196 41,576,211,453 11,409,156,622 6,079,057,772 13,040,523,442 10,859,690,912 23,166,553,173 11,670,446,382 7,373,771,464 2,404,808,416 9,739,124,958 3,434,531,374 44,653,083,974 12,171,294,446 7,466,022,099 12,234,734,999 26,597,863,683 3,765,891,106 4,231,918,943 7,223,141,445 5,022,789,857 2,356,832,794 17,367,192,254 7,141,659,565 1,251,998,063 1,199,777,743 Singapore Thailand 2010 10,620,103,752 1,988,651,818 China Indonesia 14,820,712,142 Japan 97,608,621,215 11,061,007,212 Korea 78,713,535,067 4,378,885,993 16,938,169,149 20,658,559,608 3,808,347,166 15,444,634,739 6,219,043,252 2,699,292,971 302,223,314 4,489,670,158 1,466,440,722 535,177,607 25,608,324,401 15,444,897,362 10,399,438,124 11,093,023,770 24,022,334,167 3,985,843,467 13,599,090,433 4,340,582,742 10,880,095,091 2,662,931,560 6,548,333,095 2,143,475,786 Malaysia Philipines Singapore Thailand 6,752,115,429 8,971,963,245 4,624,454,973 Source: UNCtadstat 2013 67 ... as it has weak impact in the context of increasing international production fragmentation in this region  Impacts of economic growth on exports The impacts of economic growth on exports have been... of EAST ASIAN EXPORTS and FINANCIAL SYSTEM 3.1 East Asian exports Over the years, trade openness has contributed considerably to enhancing East Asian countries’ participation in the global economy... the global financial crisis occurs, impact of global financial crisis on East Asian exports will be clarified 10 1.4 Research questions The research tries to address the following question: i)