COMPETITIVENESS OF INDONESIAN AND VIETNAMESE COFFEE TO THE UNITED STATES MARKET IN 2015-2019

Abstract

This research discusses agricultural product export activities where the commodities discussed is the competitiveness of Indonesian and Vietnamese coffee to the United States market in 2015-2019. The author chose this title because he was interested in analyzing the effect of world coffee prices, domestic coffee prices, per capita income and American coffee consumption on Indonesian and Vietnamese coffee exports to America.

The method used is qualitative method. Qualitative methods seek to understand and interpret the meaning of an event of human behavior interaction in a particular situation according to the perspective of the researcher himself. Research that uses qualitative research aims to understand the object under study in depth. The research data is obtained from books, journals, official websites, and articles with valid sources that support the author's research. The author uses a perspective of liberalism and a level of the nation-state analysis. And the theory used in the research is Absolute advantage according to Adam Smith. Adam Smith stated that trade between two countries will be based on the element of absolute advantage in certain commodities owned by a country. Countries that have absolute advantages on certain commodities relative to their trading partner countries will export these commodities to their trading partner countries. Conversely, a country will import commodities that have absolute disadvantages.

The result of this research research is that Indonesian coffee exported is still low, so it does not get a price premium like coffee from Vietnam. The weak competitiveness of Indonesian coffee is related to market share by buyers, and the relatively high export costs. Indonesia still has the opportunity to develop organic coffee beans for export.

Key words : Exports, Competitiveness, market, economic, Absolute Advantage Theory