Reform and opening up in the new era: China trade policy review

• Author: Yan Zhi,Changyuan Luo
• DOI: http://doi.org/10.1111/twec.12895
• Published date: 01 December 2019
• Date: 01 December 2019

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wileyonlinelibrary.com/journal/twec World Econ. 2019;42:3464–3477.

© 2019 John Wiley & Sons Ltd

DOI: 10.1111/twec.12895

SPECIAL ISSUE ARTICLE

Reform and opening up in the new era: China trade

policy review

ChangyuanLuo1,2

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YanZhi3

1Institute of World Economy, Fudan University, Shanghai, China

2Shanghai Institute of International Finance and Economics, Shanghai, China

3Institute of World Economy, Shanghai Academy of Social Sciences, Shanghai, China

Funding information

National Natural Science Foundation of China, Grant/Award Number: 71873037; Ministry of Education Project of Key

Research Institute of Humanities and Social Sciences at Universities in China, Grant/Award Number: 13JJD790004 and

16JJD790010; Major Program of the National Social Science Foundation of China, Grant/Award Number: 16ZDA043

KEYWORDS

free trade zone, import expo, negative list, the Belt and Road Initiative

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INTRODUCTION

In June 2018, the WTO issued a comprehensive report on China's trade policy from 2016 to 2018.

Like the previous six reports (2006, 2008, 2010, 2012, 2014 and 2016), the 2018 analysis provided

a general overview of China's macroeconomic environment and trade policy. The TPR was detailed

and informative with comments that were generally objective and neutral (Yao & Liu, 2012). Using

the WTO's publication as a reference point, our paper attempts to provide even further insight into the

evolution of Chinese trade policy over a longer time frame, with a particular focus from 2013 to the

present.

Before evaluating China's trade policy, it is necessary to note some trends in the international eco-

nomic environment. Compared with the first decade of the twenty first century, the second decade has

been marked by profound changes. In our view, there are four stylised facts that now characterise the

new international economic environment: low levels of economic growth, absence of a science and

technological revolution, lack of international cooperation and prevalence of uncertainty.

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Low levels of economic growth

According to the World Bank Indicators (WDI), the real growth rate of the world economy averaged 3.5%

during the period 2000–07 and 2.8% during 2011–18. The corresponding values for exports were 6.5%

and 3.9%; for imports, 7.1% and 3.8%; for FDI inflows, 21.7% and −3.5%; and for FDI outflows, 19.1%

and −5.0%, respectively. Moreover, the income elasticities of exports, imports, FDI outflows and FDI