Study On The Impact Of RMB Real Exchange Rate Fluctuation On Trade Between China And Thailand

Since the establishment of diplomatic relations between China and Thailand in 1975,bilateral trade cooperation has developed rapidly,and the total trade volume has been increasing.The total trade volume between China and Thailand ranged from US$1246.2 million in 1975 to US$74.14 billion in 2017.It has increased by more than 3,000 times.Thai trade deficit with China has been widening all along.Long term trade imbalance can easily lead to trade frictions between the two countries,which is not conducive to China's strategy of"one belt".This paper studies the impact of RMB real exchange rate changes on trade between China and Thailand from two aspects of total amount and structure,as well as the impact of RMB real exchange rate changes on trade between China and Thailand.In order to clarify the impact of RMB real exchange rate fluctuation on the total trade balance and structure of China and Thailand,this paper first summarizes the research status of domestic and foreign scholars on how exchange rate fluctuation affects trade balance and structure,and then briefly introduces the concept of real exchange rate and the development process of RMB exchange rate.Then it elaborates the theory and mechanism analysis of how exchange rate fluctuation affects trade,including elastic revenue and expenditure theory,price channel transmission mechanism and risk channel transmission mechanism of exchange rate affecting trade,and so on.In the measurement part,this paper chooses the real exchange rate of RMB and trade data between China and Thailand from the first quarter of 2008 to the fourth quarter of 2018 to measure trade balance and trade commodity structure between China and Thailand respectively.Firstly,the exchange rate and the total trade balance between China and Thailand are studied,then the import and export volume of different types of commodities in trade between China and Thailand are studied,and the impact of exchange rate changes on them is examined respectively.Specifically,this paper first gives a general introduction to the current situation of trade balance and trade structure beteween China and Thailand,describes and analyses the Sino-Thai trade data roughly and intuitively,and then examines the long-term and short-term relationship between the income and expenditure and structure of Sino-Thai import and export trade through unit root test and integration test of these data,and summarizes the impact of the RMB exchange rate on Sino-Thai trade income.Main factors and influence degree of branch and structure.The results of this study show that there is a long-term and stable co-integration relationship between Sino-Thai trade balance,China's real GDP,Thailand's real GDP and real exchange rate.The appreciation of RMB exchange rate will reduce the trade surplus between China and Thailand,but the impact is not significant.Thailand's real GDP is the most important factor affecting China-Thailand trade balance.In terms of trade commodity structure,the imports of most categories of products in China are negatively correlated with the real exchange rate of RMB(direct pricing method),and the exports of all categories of products in China are positively correlated with the real exchange rate.However,the elasticity of export exchange rates of seven categories of products is still relatively low,and they are not susceptible to changing prices.Overall,the impact of real exchange rate fluctuations on imports is significantly greater than that on exports.This paper shows that the appreciation of RMB can increase imports and reduce exports,thus reducing the trade surplus between China and Thailand.