Korea and Russia have experienced tremendous change not only in their trade volume but in their trade structure since the normalization of their diplomatic relations in 1990.
Comparing the two countries in structural change of export commodities cl...
Korea and Russia have experienced tremendous change not only in their trade volume but in their trade structure since the normalization of their diplomatic relations in 1990.
Comparing the two countries in structural change of export commodities classified by SITC 1 digit. Korea has been comparatively more stable than Russia. While more than half of Russian exports to Korea have continued to be concentrated in SITC 2 and 6, commodity group of Korean exports to Russia have spread over SITC 5. 6, 7 and 8 during the period under consideration.
The two countries did not show a high and rising level of strong intra-industrial trade means. That means that the trade structure. i.e .. the structure of the division of labor. between the two countries has been stayed to a horizontal rather than vertical one. In other words. the foundation of sound economic cooperation between two countries has not been reinforced.
Both countries have a comparative advantage in most of their top 10 and their top 30 exporting commodities which are classified by SITC 3 digit. However. it is notable that Korea has fewer commodity groups who has a comparative advantage not only in their top 10 but in the top 30 exporting commodities. A policy implication of this result is that. it is necessary for Korea to strengthen the productivity and competitiveness of its main exporting commodities to Russia and develop new higher value-added exporting items.