Analysis On The Trade Effect Of China's Direct Investment In ASEAN

From the "golden decade" to the "diamond decade",trade and investment facilitation and liberalization promoted by China-ASEAN free trade area has achieved great results.Through 16 years(from 2003 to 2018)of development,China has become ASEAN's largest trading partner and fourth largest source of foreign investment.ASEAN has become China's third largest trading partner and the largest destination for outbound investment.With the continuous development of china-ASEAN investment and trade and the deepening of intra-product trade and international division of labor,China and ASEAN have integrated into the global division of labor system and become an important part of the global production network.Analyzing the impact of China's direct investment in ASEAN on chinaASEAN trade under the new situation is of great significance to further study the mechanism for upgrading china-ASEAN economic and trade relations and explore the cooperation space and prospect.International division of labor deepened,and trade in intermediate goods boomed.Analyzing the development status and relevant relationship of China's investment and bilateral trade with ASEAN from the perspective of intermediate goods trade and final goods trade can help to find out the existing problems in the investment and trade between China and ASEAN,and makes clear the impact of China's investment in ASEAN on the scale and nature of bilateral trade,so as to help China solve investment and trade problems and promote economic and trade prosperity.Therefore,this paper firstly analyzes the development status of investment and trade between China and ASEAN in 2003-2018.In terms of investment,although China's investment in ASEAN started late,the growth rate of investment is fast.Meanwhile,the flow of Chinese investment to ASEAN is unevenly distributed.In terms of trade,the scale of trade in goods between China and ASEAN is expanding,trade links are getting closer and the nature of trade is changing.In the trade of intermediate products,exports are mainly semi-finished products and the proportion is increasing,while imports are gradually changing from components and parts to semi-finished products.In addition,China's trade deficit in components and parts is decreasing,while the trade deficit in primary products and the trade surplus in semi-finished products are expanding.In the final product trade,import and export are mainly capital goods,and China's capital goods trade surplus and consumer goods trade surplus is expanding.The bilateral trade between China and ASEAN has been developing unevenly for a long time.Then,this paper uses the co-integration analysis and error correction model to make an empirical analysis of the relationship between China's investment in ASEAN and trade from the perspective of intermediate goods trade and final goods trade.The empirical results show that the direct investment of China to ASEAN has a significant trade creation effect in the long run,and the impact on the trade of final goods is greater than the impact on the trade of intermediate goods,and the impact on export trade is greater than the impact on import trade.Increasing Chinese investment in ASEAN will change the scale and nature of trade between China and ASEAN.Increasing China's investment in ASEAN will expand the scale of bilateral trade between China and ASEAN,and reduce the trade deficit of intermediate goods between China and ASEAN,maintain China's temporary trade surplus of components and parts,improve the trade imbalance between China and ASEAN,and expand the proportion of semi-finished products in the export of intermediate goods,consumer goods in the import of final goods.Finally,based on the problems in investment and trade between China and ASEAN and the results of empirical analysis,this paper puts forward relevant policy suggestions on promoting the development of investment and trade between China and ASEAN and realizing the trade balance between China and ASEAN.China should continue to increase investment in ASEAN,expand the scope of investment,and improve the competitiveness of intermediate goods.At the same time,China and ASEAN should promote investment and trade facilitation and provide a sound economic environment for the development of investment and trade between China and ASEAN.