China(shanghai) Pilot Free Trade Zone In The World Economic System

Free trade zone can be determined by different countries, organizations and scholars, with a variety of definitions and interpretations. There is a common characteristic of those definitions,however, which can be referred to as “inside the country but outside the customs territory”. There are numerous types of free trade zone, typically they are free port, free trade zone, export processing zone, free tax zone and foreign trade zone etc. The development of Free trade zone coves a long period of time, considering each period and circumstance of its profound background, it indicates diverse characteristics. The purpose establishing free trade zone is to promote financial revenue and help the development of national economy.The relationship between the development of free trade zone and the development of international economy is closely related. Besides, the establishment of the free trade zone reflects the intention of the national strategy. In this paper, the development of free trade zone is divided into four stages in the perspective of the world system: First of all, at the earlier stage of capitalism, the free port is based on entrepot trade; Secondly, during the colonial expansion phase of capitalism, the free trade zone is developed as the economic and military stronghold; After that, Export processing zone springs out in developing countries when colonial system collapsed; Then, the free trade zone in globalization era face two perspectives. Either European Free Trade Area or comprehensively development in the rest of European Area. As long as the tariff and non-tariff barriers in the international market still exist, the free trade zone will have its value of existence.Beside economical purpose, geopolitics and national strategy play important role in the establishment of free trade zone. After all, this thesis analyzes the free trade zone in the perspective of political economy. In this paper, we will explore China(Shanghai) Pilot Free Trade Zone from different point of view in the direct of World System theory, Regionalism theory and Transition theory.The establishment of China(Shanghai) Pilot Free Trade Zone has profound international and domestic political and economic causes. In the world system, China is getting close to the center, while Europe and the United States showed a trend of marginalization. The rapid development of China’s economy is regarded as challenge and threat to Europe and the United States. Therefore, the Trans-Pacific Partnership Agreement(TTP) and the Transatlantic Trade and Investment Partnership(TTIP), which will play an important role in the field of international trade are introduced, yet none of them are brought into China. The United States is trying to dominant international new trade rules and limit the development of China. In this case, the Chinese trade and economic disadvantage in international competition in the future will be more obvious. The establishment of China(Shanghai) Pilot Free Trade Zone is going to be the breakthrough of the European and American economic dominance, and also the exploration of new economic and trade rules.China(Shanghai) Pilot Free Trade Zone and Silk Road Economic Belt & 21 st Century Maritime Silk Road are two strategies according to the American strategy change. Since the existing pattern of international trade is difficult to make a favorable adjustment for China, it is necessary for China to establish China(Shanghai) Pilot Free Trade Zone. China(Shanghai) Pilot Free Trade Zone is access to new rules, new standards from the internal system. Silk Road Economic Belt& 21 st Century Maritime Silk Road are new international trade agenda leaded by China whose purpose is to develop the ability of setting rules. China(Shanghai) Pilot Free Trade Zone is also a supplement strategy to promote East Asian integration, it provide reference path and a template for economic cooperation in East Asia.China is adjusting to new political and economic environment at the period of transition. China(Shanghai) Pilot Free Trade Zone represent a new era of Reforming and Opening up. It is an exploration of the economic transformation and innovation of management mode, and also China’s gradual transformation. It plays an important role in China’s economic development and government management. Even though the risks still exist, there is a great potential for the development of China(Shanghai) Pilot Free Trade Zone to be improved.