Document Type : Research Paper
Authors
1 Associate Professor of International Economics, Department of Management, Mobarakeh Branch, Islamic Azad University, Mobarakeh, Iran
2 PhD Student in Financial engineering, Department of Management, Dehaghan Branch, Islamic Azad University, Dehaghan, Iran
3 Assistant Professor of Management, Department of Management, Dehaghan Branch, Islamic Azad University, Dehaghan, Iran
Abstract
In recent years, as the interdependence of different markets has increased, the level of financial risk of developing countries exporting industrial goods has increased. The main objective is to assess the extent to which industrial exports of these countries are affected by country financial risk and its components in comparison with traditional factors of bilateral trade such as economic size, real exchange rate, common border, and distance. In this paper, panel data for the period 2022 to 2002 are used within the framework of the gravity model and the pseudo-Poisson maximum likelihood (PPML) method. According to the findings of this study, the country financial risk conditions of developing countries have the greatest impact compared to other classic factors of bilateral trade. This study also shows that among the determinants of country financial risk, with the exception of external debt risk, reducing current account risk, service debt, exchange rate stability, and international liquidity risk leads to growth in industrial exports of developing countries. Therefore, an approach to assessing country financial risk and its effective management is crucial for developing countries exporting industrial goods. Therefore, it is suggested that policies for managing these risks, including identifying them, assessing the impact on trade and the likelihood of their occurrence, prioritizing risks, considering how to deal with them, and developing measures to overcome them, should be on the agenda of export planners and policymakers in developing countries to minimize the negative impact on exports and prevent them in the future.
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