The Study On CAFTA's Trade Effect

From the 1990s, under the proposal of global trade liberalization of WTO, the regional economic integration gets a strong development as the transition phase and supplement form.In order to adapt this kind of international trend, China and ASEAN signed the formal The Framework Agreement on Comprehensive Economic Cooperation between China and ASEAN in November 2002.This agreement went into effect in July first of 2003 and made certain that the CAFTA would be completed within 10 years.This is the first FTA that China joined. For researching the effect of this international economic integration organization to China and ASEAN, on the basis of the Robson's FTA Theory, in Chapter 2 this paper firstly analyzes the effect factors of the FTA's trade effectJn Chapter 3 making these effect factors as the basis, uses the large amount of statistical data and analyzes the trade creating effect and trade diverting effect from the aspect of the reduction of the tariff, products , trade complementarity and intra-industry trade.From this part gets the conclusion that there is competition and complementarity between China and ASEAN, the trade creating effect and trade diverting effect exist at the same time and the trade between them is transferring from the inter-industry trade to the intra-industry trade.In the Chapter 4,takes advantage of the improved trade gravity model this paper makes the total analysis to the CAFTA's trade creating effect and trade diverting effect. From this model gets the conclusion that : the trade creating effect of CAFTA is very prominent, at the same time the trade diverting effect is very limited.The countries in the area still keep in touch with the countries outside the area and don't transfer the big part of trade with the countries outside the area to the countries in the area for the foundation of the FTA.