A Research On China's Intra-Industry Trade During The Period Of Its Economy Transformation

China's reform and opening up propels its economy transformation as well as its economic growth. Currently, its economic growth mode is undergoing the transform from an extensive one into an intensive one. China's total amount for imports and exports in 1978 is USD20.64 billion, ranking the 35th in world. In comparison, it ranked the 3rd in 2006, boasting a total foreign trade amount of USD1760.6 billion. Throughout the almost 30 years of China's economic growth transformation, its foreign trade has been making breakthroughs all the time, which leaves great impact on the international economy.The booming of China's trade stimulates its industrial structure upgrading and its accumulation of production factors, which is essential for the sustained economic growth at a high speed.Accompanying China's economic growth, comes the transform of its trade pattern. It is apparent that intra-industry trade is becoming increasingly important as it brings more revenue compared to inter-industry trade.This article focuses on China's intra-industry trade during its period of economy transformation. The close relation between China's economic growth pattern and its intra-industry trade is discussed. Under the SITC Category 76 are some high-tech products, which are introduced as examples for explaining the characteristics of China's intra-industry trade. Based on the IIT indexes calculation of these SITC76 products, some empirical analyses are made in order to find out what affects China's intra-industry trade from the perspectives of products and country specifics. With reference to the empirical analyses as well as some developed countries' past experiences, several suggestions concerning how to develop China's intra-industry trade in order to promote its economic growth are proposed.China's intra-industry trade should adapt to its economic and industrial growth. Furthermore, innovation must be prioritized because the export from traditional labor intensive industries should be replace by the export from emerging industries with new comparative advantages. China needs to take part in the international division of labor and conduct intra-industry trade with developed countries.