Institute for Economic and Social Research – Faculty of Economics and Business – Universitas Indonesia

THE ECONOMIC CORRELATION BETWEEN CHINA AND SOUTHEAST ASIAN COUNTRIES: Derivative Market and Real Sector Analysis

Maret 28, 2019

Abstract

This paper attempts to analyze economic integration of China and Southeast Asian countries. This paper adopts several methods: One, stationarity for correlation, Error Correction Model (ECM) for short-run relation and Cointegration for long-run relations. Two, Structural Vector Autoregression (SVAR) analysis to identify the cause and impact. As stock market index follows real sector performance this paper utilizes: One, elasticity analysis of economic growth between China and these countries as a proxy for real sector economic relations between them and two, descriptive statistical analysis on real effective exchange rate as well as Current Account Balance as a proxy of external economic performance between them. In correlation analysis, this paper found that one, stationarity of each country is difference at level; two, short-run economic relations (ECM) between China and these Southeast Asian countries and three, they have long-run economic relations. In causality, this paper found that China affects all of these Southeast Asian countries and no causality between Singapore and Philippines. In term of real sector analysis this paper found that, one, economic growth in China significantly affects all of these countries’ economic growth. Two, external economic performance of these countries are difference with special finding on Indonesia’s current account.

Download (PDF, 620KB)

Recent Post

The Impact of COVID-19 on Voter Turnout in the 2020 Regional Elections in Indonesia: Do Voters Care About Health Risks?

Maret 21, 2024

Macroeconomic Analysis Series: BI Board of Governor Meeting, March 2024

Maret 20, 2024

Dampak Ekonomi Penyelenggaraan Pertunjukan Musik: Konser Taylor Swift dan Coldplay di Indonesia dan Singapura (Trade and Industry Brief, Special Report, Maret 2024)

Maret 6, 2024

Macroeconomic Analysis Series: Monthly Inflation, March 2024

Maret 4, 2024

Related Post

COVID-19 on Voter

Maret 21, 2024

The Impact of COVID-19 on Voter Turnout in the 2020 Regional Elections in Indonesia: Do Voters Care About Health Risks?

Macroeconomic Analysis Series: BI Board of Governor Meeting, March 2024

Dampak Ekonomi Penyelenggaraan Pertunjukan Musik: Konser Taylor Swift dan Coldplay di Indonesia dan Singapura (Trade and Industry Brief, Special Report, Maret 2024)