Analysis of Trade, Investment, and Global Value Chain on the Gross Domestic Product of Fisheries Sector in Indonesia

Abstract

Purpose: This study aims to analyze the indicators that play a role in the Indonesian marine and fisheries sector's development (investment in the fisheries sector, trade openness, fisheries net exports, global value chain (GVC) and fish production) towards the gross domestic product (GDP) of the fisheries sector. Theoretical framework: The theoretical framework builds on the New Trade Theory (NTT), a sustainable ocean economy, and global value chains. Design/methodology/approach: The panel vector autoregressive (PVAR) method is used to achieve the research gols. The data used is panel data for groups of provinces in Indonesia. Findings: The results of the estimated PVAR show that the investment of the fisheries sector has a negative and significant impact on the GDP of the fisheries sector, and GVC and fish production has a positive and significant impact on fisheries GDP. Whereas, Net-export and Trade openness have an insignificant impact on the GDP of fisheries. Research, Practical & Social implications: There is a need for an effective maritime policy to reduce the environmental impact of the development of coastal resources and preserve the diversity of fish production to face future threats. This is due to the constraints of international trade in the form of information or communication, technology, and regulations. Originality/value: Research related to the effect of investment in the fisheries sector, trade openness, fisheries net exports, GVC, and fish production on the GDP fishery in Indonesia and the data used is panel data for groups of provinces in Indonesia have never been done by other researchers.