Trade interactions between the Russian Far East regions and Asia-Pacific countries: Assessment of potential

Abstract

This paper uses a gravity model to estimate and decompose the trade barriers between the Russian Far East regions and Asia-Pacific countries. The results indicate that the mutual reduction of various hurdles can intensify trade relations between the Far East regions and Asia-Pacific countries. Based on our estimates, we identify the Far Eastern regions with the largest and smallest potential for expanding trade in the face of reduced institutional barriers with Asia-Pacific countries. Our findings further suggest that all regions of the Far East exhibit comparative institutional barriers that significantly exceed tariff barriers in trade with geographically remote Asia-Pacific markets.