The Study Of The Effect Of C-AFTA On The China Textile And Clothing Trade

More and more scholars pay attention to C-AFTA, the largest regional economic integration organization in the world which is composed by developing countries. China replacing the EU became the largest trading partner of ASEAN, and ASEAN exceed Hong Kong and Japan become the third largest trade partner of China.The trade volume of textile and clothing between China and ASEAN grew from1.876billion in2000to32billion in2013. And the proportion of textile and clothing exports rose from10.96%in2000to13.53%in2013. From the data, the trade expansion effect can be seen after China join in the C-AFTA. According to the theory of economic integration, regional free trade arrangement has the influence on trade geography through trade creation and trade division effect. So analysis the trade affection after C-AFTA established will help us to find out the problem and provide the coping strategy.This paper first reviews the international economic integration theory as well as domestic and international empirical studies, and the theory of trade gravity model and its empirical application. Secondly, we analyze the development and the present situation of textile and clothing trade between China and ASEAN countries through the actual data. Thirdly, based on the economic integration theory, we analyze the Trade creation effect and trade diversion effect after C-AFTA established, also analyze the affecting factors to the both trade effects. Fourthly, we use the trade gravity model to analyze the influence of China’s textile and clothing trade effects by joining C-AFTA. The Results showed there has the trade creation effect in textile and clothing trade between China and ASEAN G7and no significant trade diversion effect. Finally, provide the appropriate policy recommendations.