European Sovereign Debt Crisis And Its Effects On The Export Trade From China To EU

European Union has become China’s largest export market Since2004, exceeding United States, Japan and other countries. However, United States overtook the EU and became China’s largest export market in the year2012. In addition, the export growth from China to the EU has continued to decline since2010. And the European sovereign debt crisis is somewhat irreverent. The European sovereign debt crisis broke out in October2009has made the EU economic being in downturn, the unemployment rate being soaring, the RMB being appreciation against the euro, and the trade friction being intensified between China and EU, Which raises challenges for the China-EU trade.This article takes the trade volume of China’s exports to the EU(15countries), the export volume of general industrial machinery and equipment and of apparel and clothing as researching object, using the relevant data from the first quarter of2006to the fourth quarter of2012, to analyze the influence channels and influence extent of European sovereign debt crisis in China’s exports to the EU, and to analyze the difference between the effect of the crisis on the general industrial machinery and equipment and of apparel and clothing. And the results show that, European sovereign debt crisis mainly affect the export trade from China to EU by the channel of exchange rates. If the euro was up1%against the Yuan, the total exports of China’s exports to EU will be decreased by1.2%. The GDP is the next channel, If the GDP of EU countries decrease by1%, the total exports of China’s exports to EU will be decreased by0.21%. The crisis caused a remarkable adverse impact to China’s exports to EU.Secondly, this article analyzes the different influence of the European debt crisis on the central equipment and clothing export trade. The results show that, the effect of price represented by exchange rate and the revenue represented by GDP of EU countries on the general industrial machinery and equipment are greater than on the apparel and clothing. In addition, the significant negative impacts by Dummy variable represented by the crisis on the exports of apparel and clothing are greater than the negative influence on the exports of machinery and equipment.