Analysis Of The Effect On Promoting Qingdao Outward Economy And Trade By The Establishment Of China-ROK FTA

Thanks to the non-stop circulation of materials, capital and information caused by development of modern science and technology, the international circulation of essential productive factors such as trade and investment enjoys the great benefit. Economic globalization and regional economic integration become key feature and trend in the world economic development. In order to take part in the global and regional economic integration, most of the countries are eager to sign the free trade agreements according to different areas, aiming at economic development, increase jobs and trade. At the same time, the northeast Asian countries acted slowly, especially China and ROK which are the key economies in this area with the fact that there is not effective trade cooperation relationship between the two countries. While with the closer economic and trade ties, the two countries reached the agreement to establish long-term economic and trade relationship which benefits all and realize high-quality and benefit-balance free trade agreement. In February of 2015, the two countries finished draft agreement of free trade area and confirmed the content. That marked the accomplishment of negotiation of free trade agreement which involves the largest trade value and most comprehensive areas. This agreement will no doubt have positive and far-reaching effect on outward economic and trade pattern of the relative areas of China and even northeast AsiaThis essay covers the research and analysis of the necessity and effect of establishment of China-ROK FTA and gives the static and dynamic research of the economic effect of the areas based on the effect factors of regional economic integration and free trade area, economic and trade exchange between two countries, industries development and history of negotiation and free trade area. In addition, with Qingdao as the target, the essay analyses the effect on Qingdao foreign trade mechanism by the establishment of China-ROK FTA from economic and trade volume, framework and investment.This essay uses some export volume data of Qingdao with key trade partners, establishes trade gravity model and introduces dummy variables to carry out empirical research of export acceleration effect. The relative research indicates that the establishment of China-ROK FTA will have obvious increase effect on the Qingdao export. Besides, the establishment of the Area will also have positive effect of deepening the trade between Qingdao and ROK and promoting bilateral trade with the research of economic and trade development potentials. The methods of summary and comparative analysis are introduced in researching the effect on Qingdao with the establishment of the Area in parts of economic and trade framework and investment. Finally, policies and advice on promoting outward trade mechanism, adapting and taking part in the development of the Area, improving the economic and trade level between Qingdao and ROK are also introduced.