An Empirical Analysis Of The Impact Of EU Eastern Enlargement On Trade Between China And EU

In May 1st, 2004, ten coutries including Poland, Hungary and Czech Rep. entered European Union(EU), which was the largest enlargement in EU history. After that, European Union has becoming the most integrated organization in the world, meanwhile, being the largest trade partner of China for the first time. On the one hand, these new members offer China a bigger and uniformer market in Europe; on the other hand, they become competitors of China's export to EU-15. EU eastern enlargement create both opportunity and challenge for trade between China and EU. Thus, it's necessary to analyse the impact of EU enlargement, which have both theoretical and practical value for how to take use of this opportunity and how to deal with the challenge.This paper compare the trade scales and their tempos between China and EU-25 members on the basis of analysing the development scale and trade structure of Sino-European trade. Then, it demonstrate the characters of both import and export trade between China and EU in order to make clear the their important statues in each other's trade development. Besides, it determine the nature of the effect of EU Eastern enlargement. Further more, this article use data from UN COMTRADE, China Customs and EU Commission to calculate three trade structure indexes which conclude that the relationship between China and EU new member are both competative and complementary. The complementation between China and EU old members are decreasing, while competition increasing. The export from China to EU is getting more and more difficult, but there's still big potential in Sino-European trade. Moreover, the paper use a gravity model with aggregate trade data and the 7th disaggregate trade data to do quantitative research on the effect of EU enlargement on trade between China and EU, and make a conclusion as follows: Since EU new members are all less developed countries, their substitution to China's goods is limited, on the whole, the postive facts and negative facts of Eastern Enlargement counteracted mostly, the trade between China and EU can develop in a more steady way. On the basis of those analyses and combine with the characters of Sino-European trade, the paper offer some relative policy suggestion to improve the trade between China and EU from the aspect of Chinese government.