Foreign Trade And The Economy Development In Backward Area

With the integration of the world economy, free trade has been better developed, and all the countries or areas have benefited from participating free trade correspondingly. Especially, the countries or areas with better economy situation have benefited more, and those with worse economy situation just benefited less from trade. Thus, with free trade developing, regional economy development has been impacted to some extent, and the impacted degree is depended on the regional economy characteristics.Generally speaking, according to development degree, the areas with different development level could be classified into three including developed areas, less developed areas and backward areas, and backward areas usually refer to the areas in which the development level is worse. But being backward is not equal to being poorly off, being poorly off must be backward, being backward is the requirement of being poverty, having shaken off poverty is not necessarily having lifted from backwardness. Especially, if the normal living of people cannot be guaranteed in an area, it is defined as poverty area; obviously it is particular case of backward areas.Since the reform and opening-up, foreign trade and economy have fundamentally changed in southwest minority region of China. While, till now, except some studies on the relation between foreign trade and economy development are made by few researchers in the views of west development and minority economy development, no systematic, theoretical analyses and empirical studies on foreign trade and economy in backward areas are made. This Ph.D. dissertation targets at theoretically analyzing the mentioned issues and testing the results correspondingly with the data through investigating southwest minority region of China, targeting at more reliable conclusions.Therefore, the following hypotheses are made:(l) backward areas are open rather than close regions; (2) backward areas have conditions to develop foreign trade and the development could be also sustainable; (3) foreign trade and economic development are not isolated, but impacted mutually.This Ph.D. dissertation adapts theories of international trade, microeconomics, macroeconomics as well as regional economics for analyzing the relationship between trade and economic development in southwest minority region of China. Further more, this Ph.D. Dissertation has empirically studied the former analyses through investigating and building econometric models.This work has theoretically proved when a small country can’t impact the economic environment of its own, foreign trade will impact itself participating international divisions through building nontrade semi-finished product model following the definition of backward area. The small country in the model is the imitation of backward area. When its productions have competitive advantages in the international markets, participating international divisions will result in better economy development with the improvement of TOT(terms of trade); on the contrary, when its productions have relative disadvantages in the international markets, participating international divisions will result in worse economy development with the improvement of TOT. The backward area referred in this Ph.D. dissertation is the small country mentioned in the model.China’s reform and opening up has adapted to the tide of world economic integration, and Chinese economy has subsequently changed a lot. This Ph.D. dissertation has done time series data co-integration analysis on the relationship between foreign trade and the economic development in southwest minority of China, the result indicates that foreign trade is one of the important factors to improve the economic development there, particularly, the structure of exports has significant impact on the economic development there; however, the export of labor-intensive products is harmful for the economic development in southwest minority of China, the export of capital-intensive products is helpful for the economic development there. While, the issue of how a foreign trade impacts on the economic development in southwest minority of China is the crucial question that would be mainly researched in this Ph.D. dissertation.Next, this Ph.D. dissertation adopts growth function including trade factors as the quantitatively analyzing model for analyzing the impact of foreign trade on the economic development in southwest minority region of China in different stages when this area participates international trade. It’s found that, at the beginning, foreign trade can highly promote the economic development. While, economic development can promote the development of free trade as well, and the structural improvement of foreign trade is perfectly inflected. In the mean time, this Ph.D. dissertation has done regression analysis the impact of the varieties of trade structure on the economic growth; it’s found that the export structure changes from predominantly primary products to predominantly manufactured products. More manufactured products export has improved the TOT, and it has strongly promoted the economic development there, and has further proved the theoretical conclusions from the model.As for the difference of endowment, geographical situation as well as the economic foundation, this Ph.D. dissertation has further comparatively analyzed the foreign trade and economic growth in Guangxi, Yunnan, Guizhou and Xizang through the above regression model in the view of portrait research, the result indicates that export positively impacts more on the economic development in Guangxi and Yunnan, in which the economic foundation and geographical situation are relatively better, and import negatively impacts more on the economic development in Guizhou and Xizang, in which the economic foundation and geographical situation are relatively worse. This has further proved the result from the theoretical model. Meanwhile, it’s further proved that in the long run, with the development of foreign trade and the economic foundation being better, imports will gradually positively impact the economic growth in the backward regions.Having researched the relationship between foreign trade and economic development, this Ph.D. dissertation has further approached a new model of foreign trade--- harmonious development model, considering the variety of resources endowment, foreign trade level and economic development situation.According to the research conclusions, this Ph.D. dissertation has provided some instructive recommendations. In order to promote the economic development and shake off poverty, the backward areas, southwest minority region as example, besides improving their from-inside motivation and level of economic growth, southwest still grasp the chance of great west development, make the most of its advantages of geography and party’s policies toward ethnic minorities to obtain more trade policies supports, and will develop harmonious development foreign trade model to develop their frontier trade with neighborhood countries as well as free trade with China-ASEAN free-trade area using their natural geographical advantages and regional resources advantages, help them to participate international divisions to benefit more from free trade.