An Empirical Analysis Of The Impact Of Sino - Japanese Bilateral Exchange Rate Fluctuation On China - Japan Import And Export Trade

Economic globalization has become an essential feature of the current international economic. the world economy is increasingly becoming an integral organic whole. Economic activities between the economies interact and interdepend.Today, the exchange rate of a currency act as a form of external price in the economic world which has played an intermediary role. It is important to the equilibrium and steady development of a country and the world economy running. Governments use it as an integral part of the national economy and external balance of macro-control tool.China and Japan are both countries of Northeast Asia economic circle, with highly complementary economic structures. With the continuous deepening of Sino-Japanese economic and trade relations, the two countries have become each other’s most important trading partner. Development and stability of Sino-Japanese bilateral trade is so high.By the end of2012,the government Abe implemented quantitative monetary easing policy--" Abe economics",the substantial depreciation of the yen exchange rate will inevitably impact on neighboring economies.In the aftermath of the financial crisis,China is in an important period of economic restructuring to maintain sustained economic and social development. Consider the impact of the yen exchange rate changes on China’s import and export trade becomes extremely urgent.This thesis has selected the time series data of economic variables from the first quarter of2000to the fourth quarter of2013. Divided from2000to2008and2000to2013two different time periods. Through building OLS model and VAR model, the Sino-Japanese bilateral real exchange rate is measured to the total import and export trade between China and Japan, in micro level, we choose electromechanical and the automotive industry,and compared between the two periods. The results showed that for China’s foreign trade balance, the results of empirical and theoretical analysis exist differences. the Sino-Japanese bilateral real exchange rate between Japan and China on the import and export trade is basically non-existent in the long-term stable cointegration. The main reason for the Sino-Japanese bilateral trade volume in bilateral real exchange rate is not affected. This is to some extent with the IMF on China’s economic judgment echoes. Finally, the empirical results of this paper were consolidated under the proposed policy recommendations.