Theoretical Part

Export Potential AssessmentsPresented By Rashedul KabirSr. Asst. Secretary, R&D, SEIP ProjectPractical PartLecture : Last Two

Market Analysis Map

Competitive Sectors

Target Markets

Fact about BangladeshThe world chooses Bangladesh market!

But real thing should be opposite:Bangladesh should choose her markets.

What Should We Do?

Export Potential Assessment (EPA) MethodologyPurpose: To help countries assess their export opportunities and increase their share in world tradeExport Potential Index:Identification of priority productsMarket Attractiveness Index:Selection of target markets

Export Potential IndexExport Performance Index (for HS 4):Revealed Comparative Advantage Indicator:Objective: To assess how competitive the country is in exporting a certain product as compared to the world.RCA (Balassa Index) = Xij/Xin Xwj/XwnWhere Xij is the export of country i for j commodity and n is a set of all exported commodities of country i, while Xwj represents the world export of same commodity j and Xwn is a world export of all n commodities.

Revealed Comparative Advantage (RCA)

Growth of Revealed Comparative Advantage Indicator

Index Normalization Formula

World Demand Index (for HS 4)Ever if a country may be able to produce large produce large quantities of goods at a comparatively low price, the export prospects will not be very promising if there is not sufficient demand for that product in the marketplace.The final amount of the exported good is a reflection of:Supply: How much of the product a country can export at a certain priceFor this we calculate the export performance indexDemand: How much of the product countries are willing to import at a certain priceFor this we calculate the world demand index

What quantity of the product will be exported if demand contrast?In the picture below we see that even if the export supply curve remains unchanged but the demand for exports decreases, the country exports less (q2 instead of q1) at a lower price (p2 instead of p1).

PriceQuantityExport supply curveImport demand curve 1Import demand curve 2p1p2q1 q2

Share of World Exports Indicator

Growth of Share of World Exports Indicator

Export Performance Index (for HS 6)

Growth of Exports

World Demand Index (for HS 6)

Change in trade balance as a share of total tradeObjective: To account for the improvements of the trade balanceChange in t=t2-t1Where, t is trade balance as a share of total tradeWhy do we calculate the absolute change instead of calculating the mid-point growth rate?We used the mid-point growth rate for positive values only.

Market Attractiveness IndexMarket Demand Index:With the necessary data at our disposal, we can start the calculation of the first sub-index the market demand index. It contains five normalized trade indicators that are related to the market demand for the selected product regardless of the exporter.The higher the index for the country, the higher is the demand for the product of this country and the more attractive is the market for exporters.

Market Size (import value)

Market Growth (import growth)

Trade Balance

Change in Trade Balance

Market Prospects (GDP growth forecast)

Market Access IndexDistance AdvantageGo to http://cepii.fr/anglaisgraph/bdd/distances.htmDownload dist_cepii.xlsDelete all the columns leaving only the column with the country names and the column named distwces.Distance Advantage=Average distance of supplying countries (km) - Bilateral Distance

Relative Preferential Tariff MarginTo get customs tariff indicator you can email: marketanalysis@intracen.orgPreferential tariff margin=average weighted tariff applied to all other suppliers to the market-customs tariff applied to suppliers

Total Exports from the Country to the MarketTrade relations= Sum of total exports from the country to the market

Sourcehttps://www.youtube.com/playlist?list=PLBD125D3A2EB0D420http://www.cepii.fr/CEPII/en/bdd_modele/presentation.asp?id=6

Advanced Market Analysis: Export Potential Index (Identifying Products); Market Attractiveness Index (Identifying Markets)http://www.itc-learning.org/course/view.php?id=38

Any ?Thank You