Research On Trade Potential Between ShanDong Province And Other Countries Within The Belt And Road

As an important economic province,a trade and foreign economic province,and a marine economic province in China,Shandong has obvious advantages in integrating into "the Belt and Road" construction.This paper summarizes previous studies,taking theoretical frontier level trade volume as trade potential,and the ratio of theoretical trade volume to actual trade volume as trade efficiency.In order to study the current trade potential between Shandong Province and countries along the route,the empirical research in this paper is mainly based on the construction of a stochastic frontier gravity model to analyze the current trade inefficiency model of Shandong Province and the countries along the " the Belt and Road" resistance factors.Then measure the efficiency and potential of bilateral trade.According to the empirical results of this paper,the core explanatory variables in the main model are the level of economic scale,geographic distance,and whether there is a common language in the trade.The trade inefficiency item model set in this paper passed the 1%significance level test,which satisfies the rationality of the model setting.Furthermore,in constructing a trade inefficiency model,this article selects factors influencing trade based on the current "One Belt,One Road" five-way development.In terms of Financial Intermediation,the economic freedom announced by the American Heritage Foundation is selected,whilst currency freedom,financial freedom,and investment freedom are selected for weighted measurement.In terms of Facilities Connectivity,the infrastructure index is selected.In terms of people-to-people bond,Shandong Confucianism Cultural representatives of the Confucius Institute are represented.The number of Confucius Institutes in the countries along the route is used to measure the degree of connection between the people of Shandong and the countries along the route.In terms of policy Coordination,this paper uses the Global Political Governance Index published by the World Bank as a measurement standard.In order to express the effectiveness of the governments of the countries along the route;In terms of Unimpeded Trade,since the signing of free trade agreements and tariff levels between countries has a certain effect on trade facilitation,the dummy variables and weighted tariff level variables of whether to sign free trade agreements are set as the measurement indicators.Based on the analysis of trade data between Shandong Province and countries along the route,this research finds that the scale of import and export trade has maintained a steady growth overall except for the global economic impact in 2015.Shandong exports more machinery products to countries,at the same time promote the infrastructure construction of countries along the route.Regarding to infrastructure construction,more mineral products are imported from countries along the route to meet the resource needs of Shandong Province;the trade mode between Shandong Province and the countries along the route is mainly based on general trade,accounting for more than 86%of Shandong ' s imports and exports to the" the Belt and Road";In 2018,the average export efficiency of Shandong Province to the 45 countries along the "the Belt and Road”was 0.3533,indicating that there is still a lot of room for improvement for trade between Shandong Province and the countries along the " the Belt and Road".This paper categorizes the countries along the route.The results show that more than 48%of the countries along the route currently have more than 200%of trade expansion space with Shandong Province,and the potential for future trade development is huge.Finally this research finds that the scale of import and export trade between Shandong Province and the countries along the“the Belt and Road”has a significant positive effect on the economic scale and common language of both parties,and a significant negative effect on the geographic distance between the two countries.There is a positive correlation between infrastructure construction and the number of Confucius Institutes,and a negative correlation with factors such as tariff levels.Based on the above conclusions,this paper proposes the corresponding policy recommendations:promote infrastructure construction and help the interconnection system;strengthen the construction of bilateral free trade agreements to increase the convenience of trade between the two sides;attach importance to cultural exchanges between the two sides of trade and enhance the understanding of trade between the two sides;standardize and improve the rules and regulations to provide protection for trade development.