Purposes of the research in this thesis are three-folds. Firstly, it categorizes possible trade risks of all kinds into trade types and identifies what trade risks need to be managed. Most effective methodology in managing trade risks is to be selected. Secondly, it analyzes and validates the adequacy of trade risk management methodology by comparing the empirical study of currently utilized methodology of export credit risk management of small and medium manufacturing exporters (SMMEs), through analyzing critical factors in recognizing trade risks and measuring perception of trade risks from SMMEs in Korea. Thirdly and lastly, it analyzes the correlation effect between trade risk management of SMMEs and actual export performance, in order to enhance the performance of trade risk management of SMMEs.
To effectively achieve the purposes of this thesis, it has combined book research together with the empirical study of SMMEs, which analyzes characteristics of general export trade and electronic trade to measure effect on trade risk management methodology, perception on trade risks by SMMEs, and correlation between trade risk management methodology and export performance.
Statistical methodology used in the thesis includes factor analysis and multiple regression analysis for testing the first hypothesis, and factor analysis and Pearson's correlation analysis for testing the second hypothesis, and logit analysis for the third hypothesis.
Based on theoretical background of trade risks, the final results of the empirical study on SMMEs regarding the effect of export performance through trade risk management by analyzing SMMEs' perception on trade risks and identifying the category of trade risk management methodologies are as follows.
Firstly, statistically significant variables could not be found to explain the perception of political risks involved in export trade by SMMEs. Secondly, significant independent variables in explaining the perception of commercial credit risks by SMMEs were export insurance coverage amount (B03), proportion of electronic trade export (D01) and non-L/C trade (Co1). Thirdly, foreign exchange risks could be explained by the proportion of non-L/C and L/C of SMMEs. Fourthly, credit risks and foreign exchange risks variables were significantly correlated to export insurance coverage in terms of validating the methodologies in managing trade risks. Political risks of importing countries, however, could not be validated in this research. Fifthly, SMMEs which managed exports risks, were found to have higher profitability of export trade as compared with those SMMEs which did not manager trade risks.