Eu Enlargement Of Trade Effect Of China's Exports To The Eu Impact Study

After Poland, Czech Republic. Hungary and other Central and Eastern European countries joining the European Union in2004. Bulgaria and Romania joined in three years later. With27member states. EU has become one of the biggest regional economic organizations.The eastern enlargement of EU in year2004and2007involves in12eastern European countries altogether. The general levels of economic development of those countries are lower than EU former members on average, especially compared with EU main developed countries, such as Germany. France, United Kingdom and etc. But those eastern European countries like Poland. Hungary have a high speed of development. Along with the collapse of the Soviet Union early1990s, eastern European countries experienced the adjustment of economic structure to market economy. The comparative advantage of these countries in international trade is focusing on labor-intensive and resource-intensive manufactures, the situation happens in Chinese commodities exporting to EU market, which means that the trade diversion caused by EU eastern enlargement will affect the Sino-EU bilateral trade to some extent.Based on the theories of Customs Union, trade diversion and trade creation effect, we are dedicated to the study of the trade effect caused by EU eastern enlargement, we are also concerned about whether Chinese export to EU market will reduce due to the competitiveness between Chinese and eastern European countries’commodities. In this paper, we provide the study the trade relations between China and EU. China and EU main developed countries, China and New members of EU, and we also provide the analysis of trade effect after EU eastern enlargement. Based on those studies, we give the empirical analysis through panel data and gravity model. After that, we illustrate the conclusion and provide our comments and suggestions. The deficiency will be mentioned in the end of this paper.We learn that it’s essential for China to maintain the competitiveness in international trade, especially in the EU market. Through the study of trade effect between EU and China caused by EU eastern enlargement, it’s meaningful for the development of Chinese international trade and economy and for Chinese social stability as well.