Past Successes and New Challenges: China's Foreign Trade at a Turning Point

Since 1979, China has recorded a remarkable trade performance, which has been driven by international processing and the offshoring strategies of foreign firms. The diversification of Chinese exports and their technological upgrading have been phenomenal. However, there is also inertia, illustrated...

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Bibliographic Details
Published in:China & world economy 2010-05, Vol.18 (3), p.1-23
Main Author: Lemoine, Françoise
Format: Article
Language:English
Subjects:
China
Exports
F13
F14
F41
Foreign trade
International trade
O33
O53
technology
terms of trade
Trade flows
Trade models
Trade policy
Trade relations
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Summary:Since 1979, China has recorded a remarkable trade performance, which has been driven by international processing and the offshoring strategies of foreign firms. The diversification of Chinese exports and their technological upgrading have been phenomenal. However, there is also inertia, illustrated by the persistent dualism of the trade sector, the unrelenting specialization in downmarket products and the deteriorating terms of trade. These weaknesses have helped its partners to adjust to the rise of this new trade power. In the past decade, China's economy has faced the adverse effects of an export‐led growth and the global crisis has revealed its vulnerability. China is now forced to rebalance its economy. This will imply major changes in foreign trade, in favor of ordinary trade and away from processing. In the foreseeable future, China is unlikely to become the driver of international demand but will remain the engine of Asian economic integration.
ISSN:1671-2234
1749-124X
DOI:10.1111/j.1749-124X.2010.01193.x