Study On Trade Facilitation And Export Of Mongolia

This study examines the relationship between trade facilitations and exports in the Mongolian economy with its 45 trading partner's countries from Asian regions.For this purpose,we choose the Mongolian economy as a sample with its partners,the period of time 2001 to 2017 and panel data.To evaluate the analysis of relationship,we constructed trade facilitation indicators from different primary variables by employing the econometrics techniques principal component(PCA)and factor analysis(FA)namely cost custom efficiency,shipment and time included other variables like access to the sea common border,tariff,economic size,and population.Findings show that most of the trade facilitation has a higher impact on exports of Mongolia such as cost,custom efficiency,shipment and time.Cost and time indicators have a negative relation with exports level and the probability of the exports.Similarly,custom efficiency and shipment have also impact on exports level and probability.According to findings,cost and time indicators in US$ and days should be reduced by implementing the state policies respectively.Furthermore,custom efficiency and shipment should have higher values to improve the customs clearance and other border agencies at the border of Mongolia.Domestic trade facilitation may enhance the exports level and probability to enter the other firms into markets with other trading partners that included in this model.Traditional gravity variable distance has negative impact on export level and probability.Results show that a higher distance in kilometer cause higher cost and reduce the exports volume,while geographical factor common border with Russia and China has larger impact on Mongolian's exports level and probability.The Government should improve the physical distance by establishing the infrastructure and providing the better facilitation at across the borders.Furthermore,economic size and population are also found significant for exports.The higher GDP of exporter enhance the export volume.Similarly,higher the population of exporter has positive impact on exports level.Trade policy variable tariff imposed by exporter and importer countries has a negative impact on the export level and probability of the Mongolian economy.Results exhibit that tariff imposed by Mongolian exporters trading partners on Mongolian products reduce the export volume and probability.This study suggests that Mongolian government should improve a domestic custom system and other border agencies including the infrastructure.To improve custom efficiency and shipment frequency should be strong bargaining with having port countries like Russia and China.The quality of infrastructure may improve the distance in terms of trade costs.Similarly,Mongolian should make a strong and fruitful agreement regarding imposing a tariff.