A Study On The Impact Of China-South Korea FTA On Bilateral Trade Based On Trade Facilitation

After the completion of the China-South Korea Free Trade Area(FTA),the implementation of preferential policies such as tariff reduction and trade facilitation measures will have a significant impact on bilateral trade between China and South Korea.According to the tariff reduction between China and South Korea,the vast majority of goods will achieve the goal of zero tariff after the transition period.Since then,the possibility of stimulating bilateral trade through tariff reduction will be greatly reduced.Promoting trade facilitation will become an important issue in trade cooperation between China and South Korea.After the signature of China-South Korea Free Trade Agreement,the rules of trade facilitation in it will improve the trade facilitation level in the China-South Korea FTA,which could impact the bilateral trade between China and South Korea.Accordingly,this paper aims to explore the rules of trade facilitation in the ChinaSouth Korea FTA,analyze their impact on bilateral trade between China and South Korea,and put forward some suggestions on how to further deepen China-South Korea trade facilitation cooperation.The paper first constructs an index system of trade facilitation,expounds the influence mechanism of trade facilitation on trade flow,and then calculates the trade facilitation level of China and Korea and analyzes their problems,compares the rules of trade facilitation in China-South Korea Free Trade Agreement and Trade Facilitation Agreement(TFA)of WTO to explore whether the former could create more facilitative trade environment.Then,the trade gravity model is used to study the effect of the trade facilitation index on bilateral trade,and the trade facilitation index is decomposed into first-level indicators to explore the different impact on bilateral trade.At last,the paper explains the impact of trade facilitation on bilateral trade between China and South Korea and put forward suggestions.The following conclusions are drawn: the trade facilitation rules in China-South Korea Free Trade Agreement are closely related to TFA,but there are still some differences between them.Although the width and depth of the trade facilitation rules in China-South Korea Free Trade Agreement are generally less than the TFA,some secondary issues of the trade facilitation rules in China-South Korea Free Trade Agreement are more extensive and profound than TFA,such as consistency,customs valuation and tax classification.With regards to the impact of trade facilitation on bilateral trade flows,the empirical results show that trade facilitation extends bilateral trade by eliminating trade barriers,cutting down transaction costs and improving trade policies' transparency and predictability.However,different trade facilitation indicators have different effects on bilateral trade.E-commerce has the greatest impact on bilateral trade,followed by regulatory environment,customs environment and port efficiency.Therefore,this paper puts forward the following suggestions: in the future trade,China and South Korea should further deepen the trade facilitation cooperation,strengthen the construction of port infrastructure,improve customs environment,promote regulatory environment,and vigorously develop e-commerce.