An Anal alys ysis is on on En Enhan hancing cing In Indo - - PowerPoint PPT Presentation
An Anal alys ysis is on on En Enhan hancing cing In Indo donesian nesian Ex Expo ports ts to to Can Canad ada Naufa fa Muna and Miftah tah Farid rid Internship : October 16 December 11, 2015 The Conference Board of Canada
Internship : October 16 – December 11, 2015 The Conference Board of Canada - Ottawa, ON Naufa fa Muna and Miftah tah Farid rid
Objective : to identify commodities that are produced in Indonesia that would have a high probability to successfully
export to Canada . The research also pays provides a case study on the application of environmental and gender equality concerns associated with garment exports. Background
the Pacific Rim.
customer preferences are virtually identical, the Indonesian export to the U.S. as a share of U.S. GDP is 20 per cent higher than the same figure for Canada. This suggests that Indonesia has room to grow in the Canadian market.
Indonesia for certain commodity groups.
market share.
, retail sales and consumption
Analysis of past and future market trends for the various commodity groups.
processing and 3) end use.
mechanism for women, and the presence of social responsibility.
Methodology: Identifying T argeted Commodities for exporting to Canada
Targeted commodities for enhancing Indonesia's exports to the Canadian market are defined as commodities that: (i) have been successful in both the world market and the Canadian market; or (ii) have been successful in the world market, but are considered to be a “missed
Methodology: Identifying T argeted Commodities for exporting to Canada
Trend in the World Import Share for commodity j Negative Positive Trend in the World Import Share from Indonesia for Commodity j Negative Ignored
(not successful in world market)
Ignored
(not successful in world market)
Positive ... and the value of both world imports from Indonesia of commodity j and total world imports of commodity j increase generates LIST A Ignored --when the trend
increase in the world import share from Indonesia for commodity j is less than the trend increase in the world import share for commodity j
LIST A-- when the trend
increase in the world import share from Indonesia for commodity j is more than the trend increase in the world import share for commodity j
and the value of both world imports from Indonesia of commodity j and total world imports of commodity j increase Trend of Canadian Import Share from the World for commodity j Negative Positive Trend of Canadian Import Share from Indonesia for Commodity j Negative Ignored LIST C Positive LIST B LIST C --when the trend
increase in Canada’s import share from Indonesia for commodity j is less than the trend increase in the Canadian import share from the world for commodity j
LIST B--when the trend
increase in Canada’s import share from Indonesia for commodity j is more than the trend increase in Canada’s import share for commodity j from the world
Success in the world market (List A)?
Success in Canadian market (List B) Missed-opp in Canadian market (List C) List A
No Data Source 1 World imports from Indonesia, 6-digit HS Code level, 2003 – 2013 COMTRADE 2 Canadian imports from Indonesia, 6-digit HS Code level, 2003 – 2013 COMTRADE 3 Canadian imports from each partner country, 6-digit HS Code level, 2003 – 2013 COMTRADE 4 Tariffs issued by Canada for each partner country, 6-digit HS Code level, 20011 – 2013 WITS 7 Consumption historical trends and forecast StatCan and CBoC 8 Retail sales historical trends StatCan and CBoC
The qualitative data comes from many literatures The quantitative data for the analysis comes from the following sources:
exported to the world around 5018 commodities (at the 6-digit HS code level).
them have been successful in world markets (List A).
Trend of World Import Share for commodity j Negative Positive Trend of World Import Share from Indonesia for Commodity j Negative Positive
Success (LIST A): 1446 Ignored: 3572
In world markets, Indonesian exports of those commodities in List A increased rapidly
List A Export Index (2003=1) The total value of exports of those commodities in List A increased from around US$ 20 billion in 2003 to US$ 120 billion in 2013.
Technology Classification of Indonesian Commodities that are Successful in Exporting to World Markets The technology structure of Indonesian exports changed little over the 2003 – 2013 time period.
Successful or Missed Opportunity Commodities in the Canadian Market Based on List A
33.9 per cent of the commodities in List A are either successful or missed opportunities in the Canadian Market:
Trend of Canadian Import Share from the World for commodity j Negative Positive Trend of Canadian Import Share from Indonesia for Commodity j Negative Ignored: the rest Missed-Opportunity (LIST C): 41 Positive
Success (LIST B): 450 1446 (LIST A)
In terms of value, successful commodities exported to the Canadian Market (List B) grew from US$ 44.7 million in 2003 to US$ 473.9 million in 2013, an increase of 960 per cent. While, Canadian imports of the commodities in List B from the world grew by 116 percent from 2003 to 2013.
Export Value of Indonesian Commodities that are Successful in the Canadian Market (List B)
The growth in the Indonesian missed-
than the growth of Canadian imports of the commodities in List C from the world (105 percent and 198 percent, respectively).
Export Value of Indonesian Commodities that are Missed opportunity in the Canadian Market (List C)
Refining of the commodities in List B and List C is obtained by excluding those commodities that had Canadian import value of less than US$ 1 million in 2013. List B: 450 64 commodities List C: 41 4 commodities Grouping according to production processes and Canadian retailing practices. The commodities quite diverse, ranging from primary products to high-end products, and from final goods to the input-goods.
Successful Commodities in The Canadian Market
FINAL GOODS
No Product Group No Product Group 1 Processed Fish 11 Footwear 2 Coffee 12 Wigs 3 Sugar 13 Precious Metal Jewelry 4 Cocoa Products 14 Electric Shavers 5 Rubber Tyres and Gaskets 15 Bicycles 6 Handbags 16 Electrical Musical Instruments 7 Paper Bags 17 Wind Musical Instruments 8 Carpets 18 Metal Furniture 9 Knitted or Crocheted Garments 19 Toys 10 Not knitted/ Crocheted Garments
Successful Commodities in The Canadian Market
INPUT-GOODS AND OTHERS
No Product Group No Product Group 1 Derivative Products from CPO 10 Valves 2 Chemical Products 11 Printing parts 3 Natural Rubber 12 Cash Registers 4 Metal Tubing 13 Lithium Batteries 5 Metal Tanks 14 High Tech Radar Apparatus 6 Copper 15 Electrical Apparatus 7 Aluminium 16 Aeronautical Navigation Equipment 8 Tin 17 Massage Equipment 9 Weighing Machinery 18 Optical Measuring Instruments
Missed Opportunity Commodities in The Canadian Market
No Product Group 1 Cashew Nuts 2 Coconut oil and its derivatives 3 Swimwear 4 String Musical instruments
The competitive analysis is limited to only those commodity groups defined as a “ missed
Determining the countries that took market share away from Indonesia will help to focus the research into what needs to be done to improve Indonesia’s competitiveness for these commodity groups in the Canadian market. The research also looked at tariff rates for the top five exporters to Canada.
9th place, and Brazil ranks 11th.
Source: own calculation using Comtrade data, 2015
Viet Nam 68.2% Brazil 17.2% India 6.3% Indonesia 2.3% United States
2.0% Rest of World 4.0%
CANADA IMPORT SHARE 2014
Import Trend 2003-2014 (%) Import Value 2014 (US$ MIllion)
0.14 0.12 0.10 0.08 0.06 0.04 0.02 0.00 60 50 40 30 20 10 0.07
Rest of World United States Indonesia India Brazil Viet Nam
Canada Import of Cashew Nut-shelled (HS080132)
and India. However, Indonesia exports more crude coconut oil.
Source: own calculation using Comtrade data, 2015
Philippines 61.4% Sri Lanka 13.9% United States of America 7.6% Malaysia 5.8% Indonesia 4.8% Rest of World 6.5%
Canada Import Share 2014
Import Trend 2003-2014 (%) Import Value 2014 (US$ MIllion)
0.5 0.4 0.3 0.2 0.1 40 30 20 10 0.22
Rest of World Indonesia Malaysia United States Sri Lanka Philippines
Canada Import of Coconut Oil (HS151319)
Source: own calculation using Comtrade data, 2015
China 64.6% Cambodia 11.4% Viet Nam 6.2% Indonesia 4.6% United States of America 4.4% Rest of World 8.7%
Canada Import Share 2014
Import Trend 2003-2014 (%) Import Value 2014 (US$ Million)
0.7 0.6 0.5 0.4 0.3 0.2 0.1 0.0
60 50 40 30 20 10 0.11
Rest of World United States Indonesia Vietnam Cambodia China
Canada Import of Swimwear (HS 611241)
States and Mexico have no tariff.
Source: own calculation using Comtrade data, 2015
China 38.7% United States
36.8% Mexico 11.2% Indonesia 7.9% Italy 0.8% Rest of World 4.6%
Canadian Import Share 2014
Import Trend 2003-2014 (%) Import Value 2014 (US$ Million)
0.6 0.5 0.4 0.3 0.2 0.1 0.0 14 12 10 8 6 4 2 0.08 Rest of World Italy Indonesia Mexico United States China
Canada Import of String Musical Instruments (HS 920290)
GDP , Retail sales, Consumption
Real GDP growth forecast in 2016 by province
Source: Conference Board of Canada (CBoC), 2015
In 2016, real GDP growth will be stronger than in 2015. British Columbia, Ontario and Manitoba will be the 3 provinces with the highest growth. BC: The housing market, construction on the first multi- billion dollar LNG terminal will provide a strong boost to the construction industry and business services. MANITOBA: investments by the public and private sectors. ONTARIO: strong growth in full-time employment which is driving wage gains and boosting household consumption; and exports should improve significantly on US economic strength and a lower Canadian dollar.
The historical data suggest Indonesia should focus on these three groups, but place less emphasis on furniture and toys. Retail sales growth during 2010 – 2014
In general, retail sales during 2010-2014 grew by 3.6 per cent per year. Among the groups: growth for jewellery and watches is the highest, followed by clothing, footwear and leather goods.
Source: Own calculation based on StatCan data, 2015
CBoC’s forecast indicates that spending will continue to grow over the next 5 years, although for some sectors there is a slowdown. The fastest growing sectors are clothing and footwear, and recreation & personal effects semi - durable goods. Clothing and footwear also have the highest increase in value terms
Consumption growth during 2010 – 2014
Among the sectors, the historical growth of household spending for semi-durable goods and clothing and footwear is the strongest . In line with the historical growth for retail sales.
Source: Own calculation and CBoC forecast based on StatCan data, 2015
Consumption growth forecasting during 2016 - 2020
their families and the health of the planet.
produced
produce to become the new norm in Canada.
cent are successful in the Canadian Market and 2.8 per cent are missed-opportunities in the Canadian market.
are quite diversified. Indonesia should focus on these product for exporting to Canada.
footwear and recreational equipment. Geographically, Indonesian exporters should focus on BC, Ontario and
neighbours countries, including China and the United States. It seems that tariffs are not a factor in explaining loss of market share since they did not change over the past 10 years. Non-tariff measures and domestic issues seem to be more important.
considered to obtain the appropriate certification, such as training and promotion for women, ensuring benefits in home-based industries, using greener material, green manufacturing, and also encouraging environmental labelling.
competitive in the Canadian market for some products.