Strategic Trade Policy And Its Application In China

While today's world trade characteristics cannot be clearly explained by traditional trade policy, the strategic trade policy theory based on scale economies and imperfect competition is still under broad dispute. What does the strategic theory actually mean and imply? How about the policy's restrictions and its effects? What will it bring to Chinese trade policy with China's entrance to WTO? This paper makes certain analysis to these questions. Considering China's market structure, industrial form, trade structure, great-nation characteristic and government action, the author draws the conclusion that it's possible and necessary to put into effect the strategic trade policy in China.The innovation of this article lies in:l)It indicates that China has the special requirements to perform the strategic trade policy, such as industrial basis, market structure, great-nation characteristic, etc.2)It points out China should make fully use of external scale economies.3)It's high time to take strategic protection to our industries based on complete understanding of relative terms of WTO.