WSEAS Transactions on Business and Economics
Print ISSN: 1109-9526, E-ISSN: 2224-2899
Volume 20, 2023
Applying the Panel Data Model to Analyze the Trade Balance between Vietnam and RCEP Countries
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Abstract: The study was conducted to analyze the factors affecting the trade balance of Vietnam with RCEP countries. By using data from 2013 to 2021 for each country in RCEP, the study applied a panel data model to determine the impact direction as well as the level of impact of macroeconomic factors on the trade balance between Vietnam and RCEP countries. Empirical results show that the factors of foreign direct investment of RCEP countries into Vietnam (FDI), the gross domestic product of RCEP countries (GDP), Economic openness of RCEP countries (OPEN), and the geographical distance between Vietnam and RCEP countries (DIS) both have an impact on Vietnam’s trade balance with RCEP countries. In particular, FDI and DIS have a positive impact on Vietnam’s trade balance with these countries. However, GDP and OPEN hurt Vietnam’s trade balance with RCEP countries. Based on those research results, the article also implies several policies to take advantage of the advantages as well as limit the difficulties of RCEP to improve Vietnam’s trade balance with RCEP countries, including (1) Implementing policies to attract foreign investment more effectively for developed countries in RCEP; (2) Develop a strategy to focus on promoting exports to potential markets in RCEP; and (3) Implement policies to support Vietnamese enterprises in renewing equipment, renewing technology, and renewing production processes to meet the quality and standards of the RCEP countries’ markets.
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Pages: 1863-1870
DOI: 10.37394/23207.2023.20.163