Non-Tariff Measures, Pesticide Use, and Fruit Export: an Application of ASEAN

Abstract

Sanitary and Phytosanitary (SPS) measures are among the most frequent nontariff measures (NTMs) confronting agricultural trade. To ensure food and environmental safety, governments and international institutions have established Maximum Residue Limitations (MRLs) for regulating pesticide use. However, the national regulation of MRLs varies from country to country. This has become a barrier to the agricultural trade, making it difficult to measure its impact on agricultural trade.

In this study, a nonlinear aggregation index, the Bilateral Heterogeneity Index (BHI), was employed to investigate the impact of MRL regulatory heterogeneity on ASEAN’s fruit exports. According to the results, the regulatory heterogeneity of MRL between trading partners leads to a decrease in ASEAN fruit exports. The impact of regulatory heterogeneity acts differently for different entities; countries with small trading scales suffer much more negative impacts than larger exporters.