The Research On China-Japan-Korea Trade Cooperation Under The Framework Of Free Trade Agreement

After the world economic crisis in 2008,the Doha Round of the WTO negotiations failed,the multilateral trade system was blocked,regional economic integration became the main driving force for economic development,and the trade cooperation among China,Japan and Korea also ushered in the era of free trade agreements(FTAs).The effective FTAs among the three countries include the China-Korea FTA(CKFTA)and the Regional Comprehensive Economic Partnership Agreeement(RCEP),the China-Japan-Korea FTA(CJKFTA)has not been signed after 16 rounds of negotiations.The promotion effect of the FTAs on bilateral or multilateral trade has been confirmed by other countries.Is it also established in the trade cooperation among China,Japan and Korea?What are the paths for the FTAs to affect bilateral or multilateral trade?What is the economic effect size?The RCEP has established free trade partnership among China,Japan and Korea for the first time,is it necessary for them to continue the CJKFTA negotiations?The dissertation is based on the discussion of this series of problems.On the one hand,the dissertation will enrich the research methods and empirical research results of FTAs’ trade effect theory and China-Japan-Korea trade cooperation,provide the theoretical basis and references for the subsequent empirical research,theoretical support and policy suggestions for the signing and effectiveness of the CJKFTA.On the other hand,it will also provide references for the government to adjust the industrial structure,orderly promote the FTAs’negotiations,the industry to adjust the import and export market and fully understand the role of the FTAs,and enterprises to make reasonable use of the FTAs and the layout of production activities.The logic of this dissertation is as follows:Literature review-characteristic facts-theoretical analysis-empirical test-research conclusions-policy recommendations.Combined with bilateral trade data of China,Japan and Korea,this dissertation comprehensively uses the standard and empirical analysis,induction and deduction,longitudinal time series and horizontal section comparison,and a variety of measurement methods,on the basis of combing and reviewing the relevant literature.it explains the development of the scale and structure of bilateral trade,the evolution of the competitiveness and complementarity relationship,the change of the Position and Participation Index of the global value chain(GVC),and the tariff reduction commitment of the three countries under the framework of the existing FTAs.It establishes the theoretical analysis framework of trade promotion effect of the FTAs,the main paths of the FTAs’ effect on bilateral trade and the economic effect size of the FTAs.Finally,the dissertation empirically tests the trade effect and influencing paths of the CKFTA and the expected economic effect of RCEP and CJKFTA.The main research conclusions are summarized as follows:First,the scale of trade cooperation among China.Japan and Korea is increasing,and the structure of trade in services is more significantly changed than that of merchandise trade.In terms of trade scale,the bilateral merchandise trade between China and Japan is the largest,but it grows at the fastest pace between China and Korea;The bilateral trade in services between China and Korea is not only the largest,but grows at the fastest pace.Since the CKFTA began to negotiate,the trade gap between China-Korea and China-Japan began to narrow,too.From the perspective of trade structure,the structure of merchandise trade changes relatively gently,the trade proportion of mechanical and electrical products,chemical products,optics,clocks.watches,medical equipment,minerals,textiles and raw materials fluctuates relatively obviously;The structure of trade in services changes significantly,the proportion of travel services among the three countries increases,the proportion of transportation services is declining,and the proportion of other commercial services,intellectual property royalties and processing services fluctuates to some extent.Second.through calculating the Revealed Comparative Advantage Index(RCA),Trade Complementarity Index(TCI)and Export Similarity Index(ESI),it finds the complementarity among China.Japan and Korea is still obvious,competitiveness is growing.By country,the relationship between China and Korea is mainly competitive.but that between China and Japan is still mainly complementary.From the perspective of the three industries,China,Japan and Korea are highly complementary and competitive in the industry field,and the competitive and cooperative relationship is more prominent.There is no obvious complementarity among the three countries in agriculture and services,China is the most competitive country in agriculture field,and Japan is the most competitive one in the services field.Third,through the calculation of GVC Position and Participation Index,it finds that Japan is at the top of the upper link of GVC compared with China and Korea,while Korea is at the lower link,it has the highest degree of participation in the international division of labor.China has been climbing up the global value chain,but the degree of participation in the international division of labor has changed little.From the perspective of the three industries,China and Korea have formed a trend to catch-up with Japan in the three industries respectively:In the agriculturel field,China and Korea have surpassed Japan in their GVC position and participation in the international division of labor;In the service sector,Japan is relatively in the upstream link in GVC,while Korea has the highest degree of participation in the international division of labor.Japan’s position and participation advantage in the global value chain is basically equalized by China.In the industry field,Japan has the highest position in the global value chain,but it is basically equalized by China,too.Its participation in the international division of labor is slightly higher than China,while Korea has the highest degree of participation in the global value chain.Fourth,empirical studies have confirmed the effect of China-Japan-Korea trade cooperation under the framework of the FTAs:The CKFTA has a significant positive trade effect on China’s export and total trade to Korea,but the promotion effect on China’s import from Korea is not significant(Perhaps the main reason for it is the impact of the THAAD entry incident).Whether from the total or dual marginal perspective of trade,the impact of the applied tariff rate change is still the main path for the CKFTA to play a role.In addition,the force on the intensive margin and the expansion margin is basically equal.During the heterogeneity test,it finds that the change of the applied tariff rate is basically accompanied by the initial trade policy uncertainty(TPU)or the post TPU.Changes in applied tariff rate and TPU mainly affect the growth rate of export through the marginal expansion.The RCEP is a"double-edged sword" for the CJKFTA,which not only provides an institutional framework for the CJKFTA negotiations and removes some obstacles to the negotiations for some sensitive commodities.but also forms a considerable replacement for the CJKFTA.The simulation results of SMART model show that,from the perspective of importing countries,the trade effect and welfare effect of tax reduction of the three countries under the framework of the RCEP are more significant than those of the CJKFTA.But the existing of the CJKFTA still has value:On the one hand,it has the economic value,from the perspective of exporting,the trade effect of tax reduction among the three countries and the welf-are growth of China are more significant under the CJKFTA than the RCEP framework;On the other hand,it has the political value,if the CJKFTA is successfully signed and takes effect,it will play a role in promoting politics,easing and stabilizing the political relations among the three countries,Based on the above conclusions,the dissertation proposes the following policy suggestions:China,Japan and Korea should strengthen political mutual trust,promote in-depth trade cooperation through mutual political and economic promotion;Correctly understand the competition and cooperation of trade among the three countries,continue to leverage the complementary advantages,and further expand trade fundamentals;Innovate the model of trade cooperation,deepen cooperation among the three countries on the GVC;Fully tap into the dividends of the RCEP system.promote the early completion of the CJKFTA which is the "RCEP+".Multiple initiatives should be in parallel to promote the further development of trade cooperation among the three countries by reducing the TPU faced by China,Japan and Korea.Enterprises should be fully aware of the trade promotion effect of the FTAs,fully interpret the content of the FTAs,and increase the utilization rate of the FTAs.Compared with the existing literature,the marginal contribution is mainly reflected in the following three aspects:First,with the principle of Regression Control Method(RCM)as the theoretical basis,the counterfactual analysis framework of the trade promotion effect of the existing FTAs is constructed;Taking the CKFTA as the research object,the trade promotion effect of the CKFTA on bilateral trade between China and Korea is tested empirically from the perspectives of export,import and total trade.Second,this dissertation takes the change of applied tariff rate and the TPU as the two main paths of FTAs’ Effect on bilateral trade.On the basis of literature analysis and theory of heterogeneous enterprise trade,the theoretical analysis framework of the influencing paths of the FTAs on bilateral trade is established and carries out empirical test.In the empirical test,bilateral trade is divided into two dimensions of total trade and trade in binary margin,and the main paths of CKFTA affecting China’s export to Korea are tested respectively.Finally,this dissertation corrects the RCA,TCI and ESI indexs by using the Trade in Value Added data,and these three indexes are used to analyze the evolution of the competitiveness and complementarity of the trade among China,Japan and Korea.On the one hand,this correcting can more objectively reflect the actual benefits of the three countries’ trade,and on the other hand,it can put the competitiveness and complementarity of the trade in goods and services under the same analytical framework,and help to comprehensively evaluate the competitiveness and complementarity relationship of the three countries in the international market.