Competitiveness and Determining Factors of Indonesian Tea Export Volume in the World Market

Abstract

Indonesia is one of the world's tea exporters, but the decline in the volume and value of its exports to date continues to occur. This study aims to 1) analyze the production trend and export volume of Indonesian tea. 2) analyze Indonesian tea competitiveness in the International market compared to other exporter countries (China, India, Kenya, Sri Lanka, and Vietnam). 3) analyze the determining factors of Indonesia's tea export volume to 7 major destination countries (Malaysia, Russia, Pakistan, USA, Germany, Poland, and Australia). The analysis methods used are simple linear regression, Revealed Comparative Advantage (RCA), Trade Specialization Ratio (TSR), and data panel regression. The results showed that the production and volume of Indonesian tea export will decrease every year. Indonesian tea has a very strong comparative competitiveness, but still below India, Kenya, Sri Lanka, and Vietnam. Indonesia tends to be an exporter of tea to the international market at the stage of export expansion. Factors determining the volume of Indonesian export are Indonesian tea production, the population of importer countries, real GDP per capita of importer countries, level of trade openness of importer countries, and importer countries' inflation rate.

Indonesian Market Concentration on The Non-Oil and Gas Commodity Before and During Covid-19 Pandemic

“…Those commodities that have positive TSR value shows in Table 1. Nursodik et al (2021) supported this study result mentioned that tea, as one of the non-oil and gas commodities, had a strong comparative competitiveness and tend to be the exporter country to the international market on the stage of expanding export. Furthermore, previous research has revealed that coal commodities http://journal.uinjkt.ac.id/index.php/signifikan https://doi.org/10.15408/sjie.v11i2.24678 (Khairina & Syahputra, 2021) and furniture commodities (Elysi et al, 2018) also have strong comparative competitiveness in the international market.…”

“…The TSR method was initially used by Kaneko & Yanagi (1988) to calculate the competitiveness of commodity X with the product life cycle, which later concluded the competitiveness of a commodity in the global market. Trade Specialization Ratio (TSR) is an analysis tool for comparative competitiveness which shows if a country acts more as an exporter or importer (Nursodik et al, 2021). If the TSR value is positive, the country tends to act as an exporter, and the commodity has strong competitiveness.…”

“…While for the nickel commodity, the study of Haryadi & Yunianto (2017) mentioned that the international trade of Indonesian nickel had not yet significantly impacted the national and regional economics. Another study by Nursodik et al (2021) explained that Indonesia's tea commodity had powerful comparative competitiveness and a tendency to be the tea exporter for the international market.…”

Export of Indonesian cinnamon in international market: competitiveness and performance

“…Comparative Advantage (RCA) (Majkovic et al, 2006;Nursodik et al, 2021). This was due to the fact that the 4 main cinnamon exporting countries in the world market had a market share of 82.7%.…”

Feasibility Assessment of Nampu Leaf Processing Bussines: a Case Study in The Mount Sawal Area

“…The nampu leaf processing business is very prospective from cost and benefit analysis as long as the raw material from nature is abundant and the export market are stable. As mentioned by (Nursodik et al, 2021) that the production factor is of the factors that affect export volume. The time required to return investment capital is relatively short because it is less than two years.…”