Study On Hub-and-Spoke Structure In FTAs Network

The fast growing Free Trade Agreement (FTA) among the world makes a great FTA network. In the FTA network, there is a country who signed a bilateral FTA with two or more countries, then we name it Hub-and-Spoke Structure(H&S structure).Since the1990s, H&S structure spread all around the world.This phenomenon has aroused great concern of scholars home and abroad, and they donate a large number of research results, but the research did not pay more attention on the new trends and dynamic of H&S structure, nor a systematic study system on the H&S structure. All of these supply a great research space for this study.This study will focus on the new trends and new features, the expansion mechanism of H&S structure from international or national level. It also will pay attention to the relationship between H&S structure and multilateral free trade system and what is the impact will the fast growing H&S structure lead to multilateral free trade system. Combined with the practice of the Chinese Free Trade Area development, we will give some propose to the construct of China’s H&S structure.The study analyzed the new trends and features of H&S structure among the fast growing rode first. it found that there is a serious asymmetry in the interests display among the H&S structure such as the Tariff concessions.bilateral negotiations power, the rule making power of FTA. The hub country will get more benefit while the spoke country will suffer more loss. More and more complicated FTA network shows the cross-cutting feature of H&S structure. In addition, the emergence of a large number of two axle hub countries supplies the H&S structure with more and more hierarchy. Finally the different developing situation of different country in different time makes the H&S structure more fluctuate.Then we changed our focus to the expansion mechanism of H&S structure. The free competition between hub countries and between hub country and spoke countries will led to the fast growing of H&S structure among the world. The hub country’s own economic development, the size of bargaining power, economic dependence on partners, the development of multilateral free trade and other relating factors will greatly influent its expansion of H&S structure. Hub country’s own economic strength is stronger, the higher the degree of opening up, it will need more spokes country market to support their development, the hub country with more powerful of bargaining power may lead him benefit more in the negotiation of FTA, so he would need more FTA partners, all this will lead to the expansion of its H&S structure; the hub country is more likely to corporate with the countries the have higher economic dependence, while this can make them benefit more; the developing situation of multilateral free trade system will also affect the expansion of H&S structure.Then this study concerned the relationship between H&S structure and the multilateral free trade system, the influence it will take to the multilateral free trade system. This paper argues that, the H&S structure is a transition stage from bilateral free trade to multilateral free trade, it will affect the multilateral free trade a lot. It may be a stumping stone or a stepping stone on the way from bilateral free trade to multilateral free trade. Considering the fast growing trends of today’s H&S structure, we need to concern more about how to promote H&S structure develop to the multilateral free trade system. Based on this, we propose two paths to promote H&S structure develop to the multilateral free trade system.Finally, as the world’s largest developing country, China should not be left behind in the trend of H&S structure. Therefore, this study proposes that china should hurry up on the construction of china’s H&S structure. China should pay more attention on choosing the right partner, the construction order of H&S structure. As long as we pay more attention on the above problem, china will get great success on the construction of china’s H&S structure, we will get to the forefront of the multilateral economic and trade integration.The innovation of this study are:(1), based on the New Institutional Economics, from the angle of hub country, this study analyzed the expansion of H&S structure.(2), take a deep look at the new trend of the and new feature of H&S structure.(3),this study gives two possible rode for H&S structure to develop to multilateral free trade system. Through this analysis, we draw the following views:(1),in the development of H&S structure, it takes more and more obvious feature such as non-symmetry, cross-cutting, hierarchy and fluctuation.(2),free competition and the hub country’s own economic development, the size of bargaining power, economic dependence on partners, the development of multilateral free trade and other relating factors will greatly influent its expansion of H&S structure.(3), just as a transit stage from H&S structure to multilateral free trade system, it will affect the multilateral free trade system a lot, so we should strengthen our cooperation, to hurry up the process from the H&S structure to multilateral free trade system.At present, the fast growing H&S structure draw many eyes of scholar, but there is no systematic research method and structure. All these set a great obstacle for a mature research structure and support of relevant theories. And all these lead to some analysis in this study stay in the relative shallow level. In the future, if there still is the chance, I will still study on this topic in depth.