Research On The Mutual Benefit And Potential Of Agricultural Product Trade Between China And Mongolia

At present,the world is in the "unprecedented change of the century",global trade protectionism is on the rise,some countries adopt trade protection policies and set a series of trade barriers,which have a significant impact on China’s agricultural trade.In this context,implementing the strategy of diversifying agricultural imports and strengthening agricultural trade with neighboring countries is conducive to stabilizing the supply chain of the agricultural industry chain,building a new development pattern with the domestic cycle as the main body and the domestic and international cycles promoting each other,as well as promoting the construction of China as a strong agricultural and trade country.China and Mongolia are closely related by mountains and water,with complementary agricultural resources and industrial structures,and have a long history of trade in agricultural products.Therefore,it is of great theoretical value and practical significance to explore the real situation and potential of mutual benefits of agricultural trade between China and Mongolia to promote agricultural trade between the two countries.This study uses the relevant economic theories such as trade benefit distribution theory,international trade theory,regional economic integration theory and other econometric methods such as OLS model,stochastic frontier gravity model and VAR model to construct a theoretical and empirical test on the mutual benefit of China-Mongolia agricultural trade,and tries to answer the following two questions: First,what is the real situation of the mutual benefit of China-Mongolia agricultural trade?What is the pattern? Is the trade balance maintained? Is there any trade squeeze? Are the terms of trade improved? Does trade have a pulling effect on each other’s economic growth? Secondly,which category does China-Mongolia agricultural trade potential fall into? What is the state of trade efficiency? Can the release of trade potential be an effective measure to improve the mutual benefits of agricultural trade between China and Mongolia? The main contents and conclusions of the study are as follows.Firstly,the competitive and complementary characteristics of China-Mongolia agricultural trade are obvious.Both sides export agricultural products in which they have comparative advantages,and there is no obvious trade squeeze between the two sides in the world market;China mainly imports textile raw materials such as animal furs and cashmere from Mongolia,and mainly exports sugar,sugar,cereals and other daily necessities to Mongolia.After the development of China-Mongolia agricultural trade through the pioneering period,shrinking period,accelerating period and full-scale enhancement period,the trade scale continues to expand with a significant growth trend,and the bilateral trade volume is USD 628 million in 2021.However,since 2012,China’s agricultural trade balance with Mongolia has changed from surplus to deficit,and the deficit has been increasing year by year,with an imbalance pattern of "big in but small out".Second,the terms of trade index of China’s agricultural products with Mongolia fluctuates and decreases from 2001 to 2021,and the overall terms of trade of China’s agricultural products with Mongolia tends to deteriorate and deepen year by year,that is,China is in a disadvantageous position in the distribution of benefits of agricultural products trade between the two sides,and the terms of trade index of China’s agricultural products with Mongolia in 2021 is only 0.21.The expansion of China’s economy relative to Mongolia’s.leads to a decrease in China’s terms of trade index for agricultural prices with Mongolia,which has a significant negative impact on its improvement by-3.01%.On the other hand,the expansion of China’s per capita income level relative to Mongolia favors the improvement of China’s terms of trade for Mongolian agricultural products with an impact of 2.38%.Labor productivity,agricultural trade dependence and product diversification do not pass the significance test in the empirical evidence of this chapter due to the type of data and small percentage,while the increase of RMB/Mongolia exchange rate is not conducive to the improvement of China-Mongolia agricultural price terms of trade,and the side-effect shows that RMB devaluation is conducive to the improvement of China-Mongolia agricultural terms of trade.Third,China’s agricultural imports from Mongolia have a pulling effect on Mongolia’s agricultural economic growth in the long run,but not on China’s agricultural economic growth;both China’s agricultural economic growth and Mongolia’s agricultural economic growth will contribute to the increase of China’s agricultural trade imports from Mongolia.The main reason is that for China’s agricultural value added,bilateral trade in agricultural products between China and Mongolia accounts for less than 0.04% of it,so it is difficult to produce a pulling effect.Fourth,the potential of China-Mongolia agricultural trade is large.Among the 42 countries along the "Belt and Road",the efficiency of China-Mongolia agricultural trade is not outstanding,ranking only 25 th.In 2021,the bilateral agricultural trade potential of China and Mongolia is 1.674 billion USD,the agricultural export potential of China to Mongolia is 895 million USD,and the agricultural import potential of China from Mongolia is 773 million USD.As for the influencing factors,the economic size of China and the trading partner countries will significantly affect the agricultural trade volume,but the economic size of China will have a greater degree of influence;the population size of the trading partner countries is conducive to the increase of trade flow,but the population size of China is not conducive to the increase of trade flow;the distance between the capital cities of China and the partner countries will have a hindering effect on the import and export trade of agricultural products between the two sides,and whether China and the partner countries have a common language will The distance between the capital cities of China and the partner countries will have a hindering effect on the agricultural trade between the two sides,and whether China and the partner countries have a common language will have a facilitating effect on the agricultural trade between them.In addition,five variables,including whether the trading partner country has signed a free trade agreement with China,whether the partner country is a member of the Shanghai Cooperation Organization or APEC,the economic freedom of the trading partner country,the freedom of trade,and government integrity,all have a significant role in promoting trade efficiency.Based on the above research contents and findings,this study puts forward the following policy recommendations: first,starting from optimizing the agricultural trade structure,promoting the expansion of China’s agricultural exports by exploring the mutually beneficial equilibrium point between China and Mongolia’s agricultural exports,improving the quality and international competitiveness of China’s exported agricultural products,and promoting local Chinese enterprises to go global,so as to narrow the trade deficit as much as possible;second,promoting the diversification of export products,maintaining Thirdly,to release the trade potential of both sides by strengthening communication and cooperation between governments,accelerating the construction of the China-Mongolia Free Trade Area,promoting infrastructure construction in China and Mongolia,and assisting Mongolia in strengthening epidemic prevention and control;finally,to play the role of Inner Mongolia Autonomous Region in realizing the mutual benefits of China-Mongolia agricultural trade,taking advantage of its natural location and important Finally,the Inner Mongolia Autonomous Region will play its role in realizing the mutual benefits of agricultural trade between China and Mongolia by taking advantage of its natural location and strategic position as well as its experience in animal husbandry development to develop agricultural trade with Mongolia through the opportunities brought by the "Belt and Road" initiative and the "China-Mongolia-Russia Economic Corridor Construction".There are four main innovations in this study: first,this study takes the theory of trade benefit distribution as the entry point,the theory of international trade as the main penetration point,the theory of regional economic integration as the fulcrum,and the connotation of mutual benefit of trade as the core point,and focuses on the real situation and potential of mutual benefit of China-Mongolia agricultural trade.The realistic situation of mutual benefits is divided into three levels from the surface to the inside: first,the trade between the two sides remains relatively balanced;second,the trade conditions do not deteriorate;third,the trade can promote the economic growth and welfare of the participants.The release of trade potential is an important way to improve the current pattern of mutually beneficial agricultural trade between China and Mongolia.By building the above research framework,selecting more comprehensive and detailed relevant data,and basing on quantitative models,we break the limitations of previous theoretical studies on agricultural trade and make new contributions to enrich the research system of bilateral trade mutual benefits.Second,to further measure the agricultural trade potential between China and Mongolia scientifically,this paper adopts the trade inefficiency term and the time-varying stochastic frontier gravity model to establish three models,including bilateral trade potential model,export trade potential model and import trade potential model,to measure the optimal frontier level of agricultural import and export trade determined by natural factors and to analyze the factors influencing trade efficiency to make up for the existing literature using the traditional gravity model to analyze the trade potential.It is found that the trade inefficiency term is the main reason why the actual trade is not close to the optimal level of trade,and the constraint variables contained in it will have a greater impact on the trade efficiency,and the trade potential of China’s agricultural exports to Mongolia is always larger than the trade potential of China’s agricultural imports from Mongolia,but the difference is gradually The difference is gradually decreasing.Then,this paper examines the terms of trade of agricultural products between China and Mongolia,which few previous studies have been conducted in this regard.Taking the time of China’s accession to the WTO as the starting point,data related to China-Mongolia agricultural trade from 2001-2021 are selected,and the terms of trade indices of China-Mongolia agricultural prices are measured using the export price index and import price index optimized by the pull-type index,and their changing trends are explained to some extent.On the basis of capturing the changes in terms of trade,OLS regression is applied to empirically test the factors influencing the changes in terms of trade of agricultural products in China and Mongolia.It is found that China’s terms of trade for Mongolian agricultural products show a trend of deterioration.Finally,this study finds that China’s terms of trade with Mongolia are deteriorating,and that China-Mongolia agricultural trade has greater potential,and there are many countries similar to Mongolia along the "Belt and Road".It will help to promote the improvement of the institutional mechanism of "One Belt and One Road" with high quality and make new contributions to the transformation of China from a "big trading country" to a "strong trading country".