A BRIEF OVERVIEW OF CHINA'S FOREIGN TRADE PERFORMANCE
Many researchers have already studied about the China’s foreign trade with the world in general and with some specific countries in particular. Drysdale and Hardwick (2018) found that China has profoundly changed the way it engages with the rest of the world. The development of domestic markets -a key element of Chinese reform- has been significantly enhanced by integration into international markets via trade, investment flows, technology transfers, people-to-people exchanges and the spread of knowledge. Li and Jiang (2018) argue that integration into international production networks and global value chains has seen China evolve into a global manufacturing and trade centre, contributing to its rapid economic growth. Kızıltan (2004) discusses China’s capability of being a super power. He asserts that China is an important regional power, and should be taken into consideration both economically and politically by all countries.
Some other authors have also done researches on China’s trade position and relationship with other countries. Temiz (2017) investigates the relationship between Turkey and China. He says that lack of political and strategic vision negatively affects the economic relations between Turkey and China. Schnellbach and Man (2015) explores the multifaceted relationship between Germany and China. The authors argue that in recent years, there have been efforts to extend cooperation to other fields like security and environmental issues. Both Germany and China increasingly consider a strategic partnership within mutual interest. According to Martin (2018) the size of the U.S. bilateral trade deficit with China has been and continues to be an important issue in bilateral trade relations.
1.1. RESEARCH SUBJECT
Research subject of this paper is China’s foreign trade with the world in general and with some specific countries in particular.
1.2. RESEARCH PURPOSE AND IMPORTANCE
The paper will examine China’s overall trade position, its overall trend, its trade balance with the rest of the world, and its trade share of world trade and in particular with some specific countries over a long historical time period.
1.3. CONTRIBUTION of the ARTICLE to the LITERATURE
This study will contribute to the expansion of the literature on the Chinese economy, and will also be useful to everyone, especially academics, who are interested in the Chinese economy and who want to evaluate the changes in the foreign trade of China.
2. DESIGN AND METHOD
In this study, changes in China's foreign trade after reforms were evaluated in the light of China National Statistics Bureau (NBSC), World Development Indicators (WDI) and World Integrated Trade Solution (WITS) data. In the following sections of the study, first the developments in the foreign trade structure of China are included. Then, the country's foreign trade performance and its position in world trade were dealt with in comparison with Germany, Japan and the USA. In the following part of China in the United States, Hong Kong, Japan, Germany, foreign trade with South Korea and Turkey were examined. In the conclusion, evaluation and suggestions are included.
3. FINDINGS AND DISCUSSION
3.1. FINDINGS as a RESULT of ANALYSIS
In 1992, China achieved 1.2% of global exports and 1.25% of imports. The same values were 7.8% and 6.1% for Japan, 9.8% and 9.7% for Germany and 13.2% and 13.45% for the USA. In 2018, while China’s share in world exports and import increased to 10.6% and to 10.3%, the USA’s share in world exports and import decreased to 9.9% and to 12.8%. Similarly, the share of Germany and Japan in world exports and import decreased. With its foreign trade policy, China has achieved the success of being the biggest importer in the world with its import of 2.7 trillion dollars and the second largest exporter with 2 trillion dollars export.
In terms of total foreign trade, according to Figure 3, China increased its share in world trade from 1% to 10%, leaving Germany and Japan behind in getting a share from world trade. Meanwhile, China’s trade surplus was 360 billion $ in 2018 and it has raised 430 billion $ in 2019.
Figure 3. China, Germany, Japan and the USA’s Share of World Trade
Source: WDI, 2019
China’s biggest partners, even if the ranking changes, in foreign trade have been the United States, Hong Kong, Japan, South Korea and Germany. This study also examined China’s trade with Turkey. While China had a foreign trade surplus against the US of 323.3 billion $, Hong Kong of 294.3 billion $ and Turkey of 13.8 billion $ in 2018, it had a deficit of 28.3 billion $ against Japan, 27.4 billion $ against Germany and 95.6 billion dollars against South Korea. In 2018, machinery and electronic goods had been the most important export goods of China, while in the early 1990s textile and clothing, shoes, fuel and chemicals were the most important goods of it. In terms of imports, while machinery-electronics and automotive were important goods in the 1990s, chemicals, plastic and rubber, metals, fuel and foods were added to these goods by 2018.
China has achieved a foreign trade surplus in the trade with Turkey since 1995. Although the trade volume between the two countries decreased in global crisis, the recovery took place immediately. In 2014, the trade volume between the two reached the peak with 23 billion $. Turkey exported $ 3.5 billion to China in 2019, it has made 17.3 billion dollars in imports from China. In the same year, Turkey's export to China has been 1.5% of its total export and its import from China has been 9.1% of its total imports.
4. CONCLUSION, RECOMMENDATION AND LIMITATIONS
4.1. RESULTS of the ARTICLE
As a result, implementing an open-door policy, creating free economic zones, increasing R&D investments, and being a member of the WTO have transformed China both into a liberal economy and producer and exporter of capital-intensive goods. This transformation has caused to increase its importance and share in world trade since 1980.
4.2. SUGGESTIONS BASED on RESULTS
In order for China to continue its trend in foreign trade; avoiding factors such as tariff and trade war that will limit its foreign trade, making private economic regions more widespread, taking new steps to improve existing free trade relations, completing the “One Belt, One Road” new silk road project launched in 2015 and it is necessary to increase its investments in the production of secondary goods, which has comparative advantage.
4.3. LIMITATIONS of the ARTICLE
It is thought that this study will contribute to the expansion of the literature on the Chinese economy. Also this study will be useful to everyone, especially academics, who are interested in the Chinese economy and who want to evaluate the changes in the foreign trade of China. However, which of the factors affecting China's foreign trade performance are more effective is out of the scope of the study. Therefore, it is thought that it would be beneficial to discuss the subject with econometric analysis.