Parsing The Ratio Of Dependence On Foreign Trade In China

Ratio of dependence on foreign trade is the ratio of commodity export and importvalue to gross domestic product of one country in a certain period. It reflects theconnection between the economy of one country and that of the whole world. And itreflects the importance of the foreign trade of one country in its national economy to acertain extent. Ratio of dependence on foreign trade in China has been increasing since thebeginning of reform and opening-up. It was as high as 70% in 2004. On the analysisof the development and present conditions of the ratio, the thesis concludes that theratio's increase is the result of multiple factors. There are some basic factors, such asthe improvement of the world's economy, the development of China's economy, etc.There are also some factors leading to overestimate of the ratio, such as the statisticalmethods, the fundamental realities of China, etc. On the one hand, the increase of ratio of dependence on foreign trade acceleratesChina's participation in the global economic integration process, promotes domesticindustrial upgrading, and boosts China's economic growth. On the other hand, itsincrease brings a series of negative impacts, such as excessive dependence on externalforces, lack of initiative, much more difficulty in macroeconomic regulation, thethreat to economic security, etc. Considering the positive and negative effects of theincreasing ratio, corresponding policy recommendations are made to enhance China'sstrategic position in the international economy.