The Reasons Of Huge Goods Favourable Balance Of Trade And Its Effects On The China National Economy

The current account goods surplus of China in 2007 is about 262.2 billion dollars. It is the biggest in the world. It takes up two-fifths of Chinese GDP, and the figure has become twice of itself since 2001. The imbalance of Chinese trade is more outstanding while the environment of economy operation and foreign trade becomes tighter. Therefore, the huge surplus is worth to be taken seriously.The innovation of this paper is on the logic thought and research view. Combining internal & external equilibrium theory with international trade theory and foreign trade developmental strategy theory, this article utilizes several analysis methods, such as integration of logic with history, theory with practice, crosswise contrast with longitudinal contrast, and so on. The reasons and the affects of huge goods trade surplus are analyzed thoroughly by the theory. Finally, it has reached a conclusion that the huge surplus has more negative influence on China's economy. And it is harmful for the sustained and healthy growth of national economy. China can reduce it by changing trade policies, the strategy of introducing foreign direct investment, reforming the exchange rate system, and through the upgrading of the industrial structure and expanding domestic demand. Ultimately, realize the internal and external economic balance.