The Negative Impact Of China’s Trade Surplus And Its Coping Strategies

After35years since the reform and opening up, our country’s foreign trade has made remarkable achievement. Especially after joining the WTO, our country’s foreign trade sustained rapid growth for many years, and has been a huge surplus, what’s more, it even has a tendency to continue for a long time. Therefore, the phenomenon of continuous large trade surplus in our country became a focus both at home and abroad. Scholars both at home and abroad carried out a lot of research about the cause of our country’s huge trade surplus and its characteristics, and has produced a great many good results, which provided a wealth of knowledge and experience to our understanding of trade surplus.In recent years, with the accelerated development of economic globalization, our country’s foreign trade has also made further achievements,the total trade was more than the United States’for the first time in the year of2013and became the largest trading nation in the world. In the increasingly open trade environment,the causes of our country’s huge trade surplus is more and more complex, at the same time, the continuous large trade surplus has a very complex influence to our country’s economic development.On the one hand, the trade surplus to a certain extent,has promoted our country’s economic development. For example,it has alleviated the employment pressure of our country,absorbed plenty of surplus products,improved our country’s international status, etc.Trade surplus, on the other hand, also has brought many negative effects to the development of our country’s economy, for example, the continuing escalation of trade friction,the enormous pressure of RMB appreciation,a surge of foreign exchange reserves, high dependence on foreign trade and so on.Therefore, researching, analyzing and solving the negative impact of our country’s huge trade surplus is not only conducive to the sustainable and healthy development of foreign trade in our country, but also conducive to the stability of the national economy and sustainable development. So, in-depth analysis of the development process,the causes, characteristics and influence of our country’s trade surplus has theoretical and practical significance to our country.This article starting from the realistic background of our country, in a review of theoretical research on the trade surplus,based on the integrated use of methods,such as comparison, induction and summary and other methods, through the the development process by describing the current situation of our country’s trade surplus,to probe into international and domestic reasons for the cause of our continued huge trade surplus.Then I use the method of combining the normative analysis and empirical analysis to explore the negative effects to our country’s economy,which have been brought by continuous huge trade surplus.After that,the article uses Eviews6.0software, which are included of ADF unit root test, JJ cointegration test, error correction model, granger causality test, impulse response, and makes use of time series of our country’s trade surplus from1994to2010to empirically investigates the relationship between the rate of inflation and our country’s huge trade surplus.and it is concluded that our country’s huge trade surplus will increase inflation. Finally, the article combines the latest relevant information of the status of our country and puts forward countermeasures and suggestions to deal with our country’s continuous huge trade surplus from different aspects and angles, so as to realize the balance and stable of our country’s foreign trade.