Author: Kotbee Shin Publisher: ISBN: Category : Languages : en Pages : 43
Book Description
This paper examines the structural changes of the Chinese economy and how they have affected Korea's exports to China. Focusing on the evolution of China's role in the global value chain, we estimate the impact of China's external demand and domestic demand. We also shed light on the effect of compositional changes in China's GDP on Korea's exports to China. The results of the VAR analysis suggest that external demand had a significant impact on Korea's exports to China prior to 2008, while Chinese domestic demand became more important afterwards. Moreover, Chinese investment is the most important factor in determining Korea's exports to China, and Chinese private consumption has recently been gaining relevance.
Author: Takatoshi Ito Publisher: Edward Elgar Publishing ISBN: 1849805296 Category : Political Science Languages : en Pages : 353
Book Description
This book brings together studies conducted by researchers in East Asian countries who seek to better understand the impact of China s rise and the consequent policy challenges. The expert contributors illustrate that the rise of China and its integration with the rest of the world is one of the most important developments in the global economy. Over the past thirty years or so, China s economy has grown at nearly ten percent per annum with the expansion of the modern, export-oriented industrial sector, to become the third largest economy in the world and the second largest in trade. This book reviews the economic growth of East Asian countries since the 1990s and the various impacts that the rise of China has had on these countries. In particular, it addresses policy challenges faced in coping with the rise of China and maintaining economic growth. This timely book will strongly appeal to academics and researchers focusing on East Asia and China as well as those interested in international trade, development and economic growth.
Author: Hyunju Kang Publisher: ISBN: Category : Languages : en Pages : 17
Book Description
While China seeks to shift from exports to consumption-oriented economy and increase the self-sufficiency rate of exports, this study uses time-varying parameter vector autoregression (TVP-VAR) to examine the impact of economic structural changes in China on Korea's exports to China over time. The result suggests that the impact of China's export shocks on Korea's exports has weakened, which demonstrates the slow-down in regional production fragmentation, considering that the Korea's export goods are mainly intermediate goods. Instead, the influence of China's domestic demand shock on Korea's exports has expanded, which implies that China has become increasingly the final destination of intermediate goods made in Korea.
Author: Kayoung Park Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
Processing trade contributed greatly to China's economic growth. The total value of China's processing trade was US $1.7 billion during the initial period of reform and opening up, and reached US $1.2 trillion in 2015. However, the proportion of processing trade in China's trade volume has been gradually declining due to the restrictions on processing trade imposed in the 2000s, a decline in overseas demand since the global financial crisis, and increasing labor costs in China. Nevertheless, its proportion still constitutes about 30% of the total trade value of China, remaining important. In particular, the percentage of processing trade with Korea accounts for approximately 50%, playing a vital role in China's total trade with Korea.China's processing trade is largely divided into two major types : processing with imported materials (PIM) and processing with supplied materials (PSM). PIM accounted for 86.2% of China's total processing trade in 2015, taking advantage of technological development and creation of value added. In PIM, Chinese firms import components, raw materials and parts so as to process and assemble them into finished products based on the firms' plan for re-export, for which the processing firms are responsible and can strategically create value added. In PSM, a Chinese processing company is provided with raw materials and components for free of charge by an overseas enterprise, and processes and assembles them on consignment and in accordance with the requirements of the overseas enterprise. The Chinese firm exports the finished parts or products to the enterprise that supplied materials and is paid through charging a processing fee. PSM can take advantage of low costs as free raw materials are supplied. Hence, it was prevalent during the early stage of reform and opening up, in which China had an abundance of labor force while it lacked funds and technologies. Therefore, PSM requires imports of auxiliary parts as well as core parts and materials, while PIM mainly requires imports of the core parts and materials which are not produced in China.There are several differences between PIM and PSM such as value addition and required technical levels. Therefore, it is necessary to conduct an analysis focusing on the trade structure of the both processing trade types. In most studies, processing trade as a whole was regarded as a type of trade because it is difficult to access to detailed trade data such as trade data by types. The existing studies analyzed the trade structures by processing stages such as intermediate goods, consumer goods and primary products based on the classification by Broad Economic Categories (BEC). However, through these studies, it is difficult to separate which import and export transactions undertaken through ordinary trade or processing trade channels. In addition, the proportion of PIM in total processing trade is considerably higher within the processing trade, and the significance of PIM for high added value can be underestimated. An analysis on the trade structure by characteristics of enterprises is also crucial. The proportions of Chinese enterprises and foreign-invested enterprises (FIEs) in different types of trade such as ordinary trade, PIM and PSM as well as shifts in these will provide meaningful implications. Most FIEs involved in China-South Korea processing trade are Korean companies. More specifically, enterprises exporting finished goods after processing to South Korea could be Korean companies which entered and operate in China. Through such detailed analysis, this paper grasps the structural changes in China-South Korea trade and regulating policy, and suggests implications.
Author: Hyunsoo Shin Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
Korea's exports to China have explosively increased in the 2000s, recording annual average growth rates of 20.3% by 2010. These are outstanding results when compared to the 8.6% average annual growth in Korea's overall exports to the rest of the world. Korea's ability to achieve the 1 trillion dollar mark in trade last year has also been attributed to the significant increase in trade with China.However, an unusual trend began to emerge since 2011 in Korea's exports to China. The increasing rate in exports to China has been lower than that in overall exports, and has even shown signs of decreasing in 2012. The prolonged economic instability in the advanced countries occasioned by the financial crisis in the Euro zone has started to impact the heretofore skyrocketing exports to China. The slowdown in China's exports brought on by the stagnation of the global economy has started to gradually impact a Korea that utilizes China as its processing trade base.If the recent slowdown in exports to China can be attributed to the slowdown in the Chinese economy and China's exports, then Korea's exports to China can be expected to recover along with the global economy. However, it will be difficult to expect the kind of explosive increase in exports to China witnessed in the past if this situation is in fact the result of changes in China's economic structure and policy, or of problems in terms of the trade structure between Korea and China. The status of China as Korea's largest export market makes it necessary to conduct a review of the causes of the slowdown in Korean exports to the Mainland.
Author: Sunoong Hwang Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
Trade has played a crucial role in the rapid growth of Korea over the last few decades. The share of Korea's real exports in its real GDP increased from 4.2% to 49.3% between 1970 and 2010. Therefore, it is very important for Korea to gather empirical information about the determinants of its exports, which is the goal of this article. There has been a substantial amount of research on the effects of global business cycles, the relative prices of exported goods, and the exchange rate of the Korean won on Korea's exports.1) This article complements the existing literature by determining the role of China in influencing the exports of Korean industries. Among the structural changes in the international trade environment that the Korean economy has faced in recent years, the most important are China's rapid growth and its integration into the global economy. On the one hand, China's share of Korean exports has risen rapidly since 1990s, and now the Chinese market accounts for the largest share of Korean exports among its trading partners. On the other hand, the rise of China as the world's major supplier of cheap manufactured good has put increased competitive pressure on Korea industries. As a result, changes in China's exports and consumption expenditures may have a significant effect on Korean exports. Of note is that the exact magnitude of the effects is likely to be different between industries, since the degree of dependence on China as an export market and the degree of competitive pressure imposed by China are different across industries.This article provides industry-level evidence on the long-run effects of China's exports and consumption expenditures on Korean exports, using the fully-modified generalized method of moments (FM-GMM) proposed by Kitamura and Phillips (1997).2) The estimation results suggest that the effect of China's exports is quite different across industries, with the mean effect statistically indistinguishable from zero. In contrast, China's consumption expenditure has a significant and positive effect on Korean exports in most industries. Interestingly, in both cases, the magnitude of the effect is much larger in heavy manufacturing, capital and intermediate goods industries than in light manufacturing and consumption goods industries, reflecting the characteristics of vertical production linkages between China and Korea.The remainder of this article is structured as follows. Section 2 provides a descriptive discussion of the characteristics of China's exports and domestic consumption expenditures as well as Korea's exports to China. Section 3 performs an econometric analysis of the role of China in Korean exports. Section 4 concludes the article.
Author: Dongsoo Kim Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
Korea and China established formal relations 30 years ago. Vibrant bilateral trade has significantly contributed to the economic growth of both nations. However, a remarkable turning point has occurred recently: Bilateral trade seemed to balance out due to China's lockdown policy and Korea's stronger corporate competitiveness, but Korea has posted a trade deficit with China since last year for all goods except semiconductors. Such a deficit could signal the beginning of structural change, though the figure over the last four months might be a temporary phenomenon.Over the last 30 years, high-tech industries have played an increasingly important role in bilateral trade in both exports and imports. In exports, semiconductors, petrochemicals, and displays have leading positions but in imports, Korean manufacturing is highly dependent on China, which is expanding into other industries. That means Korea is increasingly reliant on components or raw materials from China, leading to greater risk factors.To effectively respond to the short-term deficit and mid- to long-term structural changes in trade with China, Korea must diversify its import partners, even if doing so is likely to incur high costs in the short term. In the mid-term, the country should develop overseas resources and change its strategic approach to the global market, which should be framed as economic blocs, rather than as a single entity. Over the long term, Korea must strengthen its industrial competitiveness and foster high-tech human resources to secure key technologies to maintain its comparative advantage over China.For the first time in its modern trade with China, Korea recorded a trade deficit for four consecutive months, representing reversal major reversal of roles: Korea had in the past recorded enormous trade surpluses in the tens of billions of USD. Thus looking at the trade deficit with China provides an opportunity to consider changes in the bilateral trade balance, the reasons for these changes, and potential responses to them.
Author: Kotbee Shin
Author: Kotbee Shin
Author: Shin Kotbee
Author: Takatoshi Ito
Author: Hyunju Kang
Author: Kayoung Park
Author: Hyunsoo Shin
Author: Sunoong Hwang
Author: Dongsoo Kim
Author: Kyu-Chul Jung