Research On The Trade Structure Changes From The Angle Of Constructing Sino-ROK FTA

Since the establishment of diplomatic ties between China and South Korea in1992,bilateral economic and trade cooperation are continuously strengthened, the growth rateof trade between the two countries has rapidly exceeded the respective growth rate oftheir total amount of foreign trade. China and South Korea’ import and export tradevolume reached$228.92billion in2013. At present, China is the largest trading partnerof South Korea, and South Korea is the third largest trading partner of China. Recently,with the development of trade in goods and services between the two countries, theinternational capital flow and the development of transnational investment, economic tiesbetween China and South Korea is becoming closer than ever before.With the rapid development of globalization and regional economic integration, thetrade structure between China and South Korea has been experiencing a serious ofprofound changes. Inter-industry trade based on the traditional trade theory,intra-industry trade as the main characteristics of economies of scale, and intra-producttrade which due to product standardization by technology advance and reducing tradebarriers, have a profound impact on the trade pattern between China and South Korea.Therefore, analyzing the trade structure of China and South Korea from differentperspectives has become an important topic of this paper. The conclusion will grasp theclue of the trade structure changes between China and South Korea, so as to providefoundation of overall and relevant industry’s interests in FTA negotiations for the nextstep. Generally speaking, the more similar in economic structure between two countries,the cost is lower when establishing an integrated organization, and the benefits are bigger.After establishing the integration organization, the similarity of economic structure islikely to change differently due to various trade and economic elements liberalization. Soanother research focus of the paper is to analyze how the trade structure of China andSouth Korea will be influenced by the implementation of FTA.This paper is divided into five parts. The introduction part mainly introduces theresearch background, significance and methods, illuminates the structure of the paper,and puts forward the innovation and deficiency. Then it presents the relevant theory and literature, making them the basis of this paper. The second part expounds China andSouth Korea respective FTA development strategies and their characteristics, thenpresents the development of Sino-South Korea FTA and makes a simple comment on thefocus of the controversial issues. The third part uses the relevant trade indexes to conductthe empirical research on the trade structure between China and South Korea,respectively from three angles-overall, competitive and complementary aspects on thebasis of a large amount of data after collecting and sorting. It found that each of the twocountries in the bilateral trade now has its comparative advantage. Inter-industry tradeand intra-industry trade coexistent, the share of intra-industry trade has been graduallyincreasing. After the comprehensive analysis of trade structure between China and SouthKorea, the fourth part summarizes the current situation of China and South Korea tradeliberalization. On this basis, it analyses the Sino-South Korea FTA potential impact onthe trade structure between the two countries. Fifth part, according to the previousanalysis, it puts forward the operational policy measures for China in the implementationof Sino-South Korea FTA negotiations, to avoid the risk on greatest degree and maintainnational interests.