In 2021, China is in the historical intersection of the goal of "two hundred years". China’s economy and trade has expanded from quantity and scale to quality and efficiency, and high-quality development has become the goal and motive force of China’s economy and trade development under the new development pattern. How to develop China’s foreign trade and economic cooperation in the future? What problems should we pay attention to and what challenges should we face in international trade?
On October 23-24, the 8th China Academic Forum of Experts and Young Scholars in World Economics and the 3rd American Economic Forum of China World Economic Association, with the theme of "New Changes and High-quality Development of World Economy", discussed the above issues in depth. More than 300 experts and scholars from universities and research institutes of Chinese Academy of Social Sciences from all over the country participated in the conference through online platforms, and nearly 10,000 scholars and students watched the live broadcast of the forum through bilibili.
Screenshot of forum online speech
There will be more fragmentation in the global value chain in the future.
Qiu Bin, a professor at the School of Economics and Management of Southeast University, believes that global value chains have always been fragmented. From the complex global value chain trade network, it can be seen that from 2000 to 2017, some changes have taken place in countries with high centers: in 2000, Germany, Japan, South Korea and the United States became the centers of Europe, Asia and North America respectively; After 2017, German position in Europe has been strengthened, China has become the center of Asian production network, and North America is still centered on the United States.
In terms of service industry, China was in a relatively marginal position in 2000. Japan, South Korea and the United States were the centers of global value chain trade networks in Asia and North America, respectively. In 2017, the service industry center in Asia was the highest. Based on the background of Trump’s tariff increase and COVID-19 pandemic, Qiu Bin’s cooperative research found that decoupling had the greatest impact, with China’s loss exceeding 40%, while the United States’ loss was close to China’s, and decoupling would also make the global value chain more fragmented. Combined with the latest literature, it is found that there will be more fragmentation in the global value chain in the future. During the crisis and subsequent recession, the growth rate of value creation related to foreign direct investment is faster than that related to trade; The output of major manufacturing countries is more dependent on China’s input.
Technical Barriers to Trade and Export Adjustment of China Enterprises
Under the new situation of globalization, technical barriers to trade are frequently used by many countries, especially in China. How do these technical barriers to trade affect China’s exports? Answering this question accurately is the premise of China’s policy response.
Professor Qing Liu, deputy dean of the National Development and Strategy Institute of Renmin University of China, found that: firstly, the impact of technical barriers to trade did not weaken China’s overall exports. On the contrary, the value of China’s export products, the number of products and the number of export enterprises all showed a net increase effect after encountering barriers; Secondly, the export enterprises have undergone significant dynamic adjustment of "survival of the fittest" and "upgrading and upgrading", some enterprises have withdrawn from the market, new enterprises have entered the market, and enterprises that continue to export have improved their product quality, which has promoted China to gradually concentrate on enterprises that export high-tech intensive and high-quality products as a whole; Third, the net impact of technical barriers to trade is heterogeneous in many dimensions. For example, technical barriers have a greater negative impact on consumer goods and high-substitution elastic products, but less negative impact on intermediate inputs, capital goods and low-substitution elastic products; It is a big obstacle to the market entry of private enterprises, but it has no effect on state-owned enterprises and foreign-funded enterprises.
Therefore, the developed economies’ technical barriers to trade with China are a "double-edged sword", which has had a negative impact on some enterprises in China, but at the same time it has also brought the effects of "survival of the fittest" and "upgrading quality" to the exports of China’s export enterprises. In the face of technical barriers to trade in developed economies, it is the premise of all further research and decision-making to study the actual impact, impact mode and mechanism. On this basis, how to deal with it in a targeted manner and how to avoid disadvantages is a problem we should think about.
Screenshot of forum online speech
Can RCEP Hedge Sino-US Trade Friction?
During the Tenth Five-Year Plan period, China faced a complicated and changeable external economic environment, especially the uncertainty of Sino-US economic and trade relations, which became the biggest external risk for China’s economic operation. In this context, accelerating the implementation of the free trade zone strategy is a powerful measure to deal with US trade protectionism and safeguard global free trade rules.
Professor Ma Hong, deputy director of China Economic Research Center in Tsinghua University, made an analysis in two aspects. First of all, by analyzing the basic pattern of Sino-US trade and the evolution of tariff friction, it is found that trade friction has significantly reduced the bilateral trade volume and real wages between China and the United States, and nearly two-thirds of the decline in real wages comes from the decline in trade in intermediate inputs. At the same time, Sino-US trade friction has also produced a certain degree of trade transfer, and Latin American countries such as Brazil and Mexico, as well as ASEAN countries such as Vietnam and Indonesia, have seen significant increases in exports. Second, China’s further opening-up can partially offset the negative impact of the US tariff increase on China. Taking the Regional Comprehensive Economic Partnership (RCEP) as an example, RCEP significantly reduced the bilateral tariffs between China and Japan and South Korea, and further promoted the vertical division of labor and cooperation in the industrial supply chain of "Asian factories".
Professor Ma Hong’s research shows that after the full implementation of RCEP tariff commitments, China’s exports have improved compared with the actual wages, especially in the textile and garment, communication equipment and electrical equipment industries. At the same time, it is found that China can further alleviate the adverse impact of Sino-US trade friction from the aspects of trade volume, wage level and welfare level, but on the other hand, it also loses more tariff revenue.
Professor Ma Hong emphasized that joining RCEP is only the first step to a higher level of opening up, and more attention should be paid to the emphasis on competition rules. The more important issues include the rules of origin, the rules of trade in figures and services, and the competition neutrality of state-owned enterprises, which need more rigorous and in-depth discussion.
Trade Liberalization, Career Choice and Individual Income Inequality
What is the relationship between opening to the outside world and income inequality in China? So far, there is no conclusion. It is of great practical significance to clarify the relationship between trade opening and income inequality in China under the current situation that China is further deepening reform, opening wider to the outside world and building a new pattern of all-round opening.
The research of Professor Sun Churen and Dr. Chen Jin, vice presidents of Guangdong University of Foreign Studies, found that trade liberalization will lead to the widening of the income gap among workers and export entrepreneurs, and the narrowing of the income gap among domestic entrepreneurs, and eventually lead to the decline of overall income inequality. Its mechanism is that trade liberalization has led to changes in the size of different income groups and changes in their relative income. Specifically, trade liberalization will bring about the expansion of workers’ scale, the reduction of domestic entrepreneurs’ scale and the expansion of export entrepreneurs’ scale. At the same time, the income growth rate of different income groups is different, among which the relative income of export entrepreneurs and domestic entrepreneurs has increased, but the growth rate is slow, and the relative income of export entrepreneurs and workers and that of domestic entrepreneurs and workers has decreased by a large margin.
The policy implication of the above research results is that under the condition of individual heterogeneity, trade liberalization will lead to changes in individual career choice and income of certain skills by changing individual career choice behavior and export behavior, and then affect the changes of income inequality within different groups and overall. Because trade liberalization will lead to the widening of income gap among workers and export entrepreneurs, while the narrowing of income gap among domestic entrepreneurs, it is necessary to properly handle contradictions within groups. Since trade liberalization will also lead to a decline in overall income inequality, the government can improve its income distribution and enhance people’s confidence in social fairness and justice through further opening-up policies.
External demand shock and enterprise’s export to domestic sales
Promoting export to domestic sales is a realistic choice for foreign trade enterprises to survive.
Professor Chen Yongbing from the School of Economics of Xiamen University found that the negative external demand impact significantly increased the domestic sales of the affected enterprises, prompting enterprises to export to domestic sales, but a 1% decline in exports only led to a 0.15% increase in domestic sales. Further research shows that under the impact of negative external demand, enterprises lose the stable cash income obtained by relying on overseas markets and face "piecemeal and high" market adjustment costs, thus inhibiting the overall conversion rate of enterprises’ export to domestic sales. Small enterprises with low human capital intensity and labor-intensive are more inclined to turn to domestic market under the impact of negative external demand, and the poor competitiveness of enterprises that turn to domestic market is also an important reason for the low overall conversion rate of foreign trade enterprises’ export to domestic market.
In the short term, supporting export products to domestic sales is an emergency measure to help foreign trade enterprises solve the problem of domestic sales and promote the basic stability of foreign trade. In the long run, supporting the export products to domestic sales is also a long-term way to promote the effective integration of domestic and foreign trade, make full use of the domestic and international dual cycle, and cultivate new advantages in participating in international cooperation and competition.
Therefore, first, we should speed up market access to help foreign trade enterprises explore the domestic market. Accelerate the docking of international standards with domestic standards, support the products with the same quality and the same standard in the same line to accelerate their entry into the domestic market, and support the docking of foreign trade enterprises with buyers; To speed up the administrative efficiency of the government, it is mainly to optimize and simplify the examination and approval procedures, so that enterprises can obtain domestic sales licenses as soon as possible. Second, preferential policies should be introduced to ease the financial pressure of foreign trade enterprises. Encourage bank financial institutions to provide credit support to foreign trade enterprises, implement various policies of lowering the RRR and reducing interest rates, guide financial institutions to focus on supporting foreign trade enterprises and export-to-domestic projects, and help enterprises solve the problem of tight capital chain; Subsidies will be given to the costs incurred by enterprises in equipment procurement and transformation, domestic trademark registration and standard certification in order to meet the domestic market demand and domestic standard certification.
The two seminars on "World Economy Theme" and "American Economy Theme" were presided over by Professor Yin Zhongming from the School of Economics of Southwest University for Nationalities and Professor Shen Guobing, deputy director of the Institute of World Economy of Fudan University. The forum was hosted by the Institute of World Economics of Fudan University, the Key Research Base of Humanities and Social Sciences of the Ministry of Education, the "American Economic Forum" of the China World Economic Association, and the School of Economics of Zhongnan University of Economics and Law, and was undertaken by the School of Economics of Zhongnan University of Economics and Law.
(The expert opinions in this article are compiled by the School of Economics of Zhongnan University of Economics and Law and the Conference Group of the Institute of World Economics of Fudan University. )
