Impact of trade balance by sectors
The AFTA is expected to lead to an increase in the Lao trade deficit in some sectors, whereas
it may improve the trade balance in other sectors. It may improve in the following sectors:
metals, oil, wood products, electricity, recreation and other services, and cereal/grains.
However, there are a large number of sectors which will experience trade deficits. The top 10
sectors expected to decline from AFTA are food products, machinery and equipment,
chemicals, rubber, plastic products, petroleum, coal products, apparel, mineral products,
transport, crops, beverages and tobacco products, and motor vehicles and parts. Therefore, it
is important for policy makers to carefully consider the impacts of AFTA on food security
(table 7-4; 7-5).
No.
Code
Sector
Change (%)
1
mvh
Motor vehicles and parts
81.47
2
ome
Machinery and equipment
70.3
3
oil
Oil
56.63
4
nfm
Metals
48.91
5
crp
products
35.79
6
ely
Electricity
32.59
7
i_s
Ferrous metals
26.57
8
coa
Coal
21.01
9
wtr
Water
20.22
10
otn
Transport equipment
18.55
No.
Code
Sector
Change (%)
1
sgr
Sugar
-55.6
2
lea
Leather products
-39.96
3
tex
Textiles
-33.41
4
ocr
Crops
-25.64
5
mil
Dairy products
-20.69
6
vol
Vegetable oils and fats
-19.21
7
wap
Wearing apparel
-15.61
8
isr
Insurance
-12.2
9
gas
Gas
-4.44
10
p_c
Petroleum, coal products
-4.07
29
Table 7-4. Top 10 sectors increasing intrade balance
Source: authors’ GTAP model results.
Table 7-5. Top 10 sectors declining intrade balance
Source: authors’ GTAP model results.
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