Study On China' Commodity Export Potential Toward Emerging Market Countries

In recent years,with the rapid development and foreign trade expansion,the emerging market economies become the bright younger generation and play a more and more important role in the world economy.Under the influence of the world financial crisis,the economy and demand of the developed countries are shrinking.In contrast,for its industrialization and consumption,emerging market countries are showing rapid economic recovery and strong import demand.Therefore,emerging market economies have become the focus of world attention,and also become countries especially developed countries mainly target export market.As an emerging market country,China has the natural advantage of promoting trade with other emerging market economies.As the demand of China's commodity in developed countries are reducing,pioneering emerging markets' demand has become an important choice of China to develop its' export trade.Therefore,this paper studies the export potential of Chinese commodity in emerging market countries,aiming at exploring how to achieve the potential volume of trade in emerging market countries and gaining more market opportunities.Thus we can give some suggestion to the government and enterprises on their export strategic choice.The article selects 25 emerging market countries which have large trade volume with China as the research object,take a step-by-step way to study China's foreign trade relationship with the 25 countries.First of all,using trade combined analysis index,we get the conclusion that China has a close relationship with 22 countries in export and so as to 20 countries in import from China;Second,from a trade volume point of view,China and emerging market countries are important partners each other in import and export;Third,analysis export trade features between China and emerging market countries according to the BEC7 categories of goods:export mainly concentrated in three major categories,BEC4(capital goods and parts and accessories,transportation equipment excluding),BEC2(industrial supplies)and BEC6(consumer goods).The former two have obvious advantages,which has the largest share in the total trade volume.The latter mainly contains labor intensive and light industrial products,which are China's traditional comparative advantage industry,maintained a high market share,though the comparative advantage is declining.Though the export volume is modest,BEC5(transport equipment and parts and accessories)has competitiveness in the world market.The above four categories of goods are mainly exported to the selected 10 emerging market countries,the export potential in the rest 15 countries will appear when the competitiveness of China's commodity is promoted and the world cooperation is deepen;Fourth,using the gravity model we find out China's currently export insufficient goods and countries in terms of BEC categories.BEC1(food and beverage)in the vast majority of the country's export potential are not achieved and China's food and beverage industry does not have obvious comparative advantage.The industry should improve its technology to achieve the export potential.China's export insufficient partners in BEC4,BEC2,BEC6 and BEC5 are Mexico,South Korea,Indonesia,Turkey,India,Brazil and Russia.Fifth,the empirical analysis show us that China has great export potential with the other BRIC countries except South Africa,thus we take the BRIC countries as an example,exploring how to expand the export between China and BRIC members.Based on the analysis of national natural features and trade characteristics,using the revealed comparative advantage index,we explore the trade potential and competitive advantage of China commodity in the BRIC countries.In this part we use HS1996 six bit code to select the goods,first select the goods that the emerging market countries import from the world market but not from China and then select the goods that China exports to the world market but not to BRIC countries.We can calculate the revealed comparative advantage of the selected HS6 bit code commodity and explore ways to further expand the export;Finally,giving some suggests to China on how to realize the export potential in the emerging market countries.The article mainly draws the following conclusions:firstly,China and most selected emerging market countries have close trade relations in both export and import trade;Secondly,there are both intra industry trade and inter industry trade between China and emerging market countries.Trade imbalance is the main characteristics and China not only is the trade surplus country but also a deficit country.China as the trade surplus country,trade structure is characterized in export technology,capital intensive goods and import primary,resource intensive products.When China is trade deficit countries,trade structure is characterized by importing capital,techno logy intensive and high-added-value goods,exporting resources,labor intensive goods,even in the inter industry trade,China's exports mainly concentrated in the low end of the industrial chain.Thirdly,the advantage of China's traditional comparative advantage industries is weakening,but capital,technology intensive(including transportation equipment)industries has increased gradually and become the main export commodities of China.Fourthly,China has export potential in emerging market countries,according to the BEC categories,BEC1(food and beverage)commodities have the most export potential but have weak export competitiveness.BEC2(industrial supplies),BEC6(and other consumer goods),BEC5(transport equipment and parts and accessories)are China's competitive advantage commodity and have a large proportion in the export volume.Fifthly,according to country,China's comparative advantage commodities has large export potential in Mexico,South Korea.Indonesia,Turkey,India,Brazil and Russia,explore the potential market in these countries is the key work of China's future export trade.Sixthly,in the remaining 19 countries,the bilateral trade potential with China has realized,the whole trade volume occupies a considerable proportion in total exports of China,the key task is to maintauin the existing market share.In order to realize the potential of trade volume and explore new market opportunities for China's commodities in emerging markets,the paper puts forward some policy suggestions from different aspects.First,the government should make efforts in the following five aspects:The first is to strengthen economic and trade cooperation with the emerging marrket countries;The second is to promote the upgrading of domestic industries:The third is to strengthen the construction of foreign trade legal system;The fourth is to encourage domestic enterprises to explore the foreign markets;Last is to promote enterprise overseas investment.Second,the key task in the enterprise level:The first is to pay attention to the basic characteristics of emerging market countries;The second is to make great effort on product quality and R&D investment;The third is to establish brand awareness;Third,to the countries which export potential did not realize,we give some advices to achieve the potential respectively,to the other countries we need to maintain the existing market share.The innovation of this paper lies in four aspects:first,the study includes 25 countries and from the point of view of BEC7 categories to explore China's export potential;Second,the establishment of the empirical model,not only contains the variables of traditional trade gravity model,but also introduce Confucius Institute,culture distance variable to study the main influence of China's export in the emerging markets;Third,using the 6 encoding products of HS1996 as the research object to explore China's export potential in the BRIC countries;Last but not the least,in order to promote China's export to the emerging market countries,we give some advices to the government and enterprises.