Research On China's Processing Trade Effect

Since the application of reform and open-up policy, processing trade has undergone a fast development in China and become the leading trade of China's foreign trade, which accelerated the development of our national economy.Processing Trade plays an important role in attracting FDI ,improving technology,increasing and promoting the development of China's economy.Processing trade can attract a lot of FDI,offer plenty of job opportunities,train many skilled labors,enlarge international channel and bring advanced technology which enhanced domestic technology level through knowledge spillover,contagion and learning by doing effects. In this paper, the use of large amounts of data, charts and statistics, through rigorous logic and a lot of data analysis, the effect of processing trade in-depth analysis, detailed in the processing trade-effective access to the role of the three channels: the multiplier effect, employment effect, Effect of industrial upgrading. By empirical results, we can see that China's processing trade has developed very rapidly, but there are still shortcomings, such as low value-added, industry linked small degree, the frequent trade friction, increasingly rampant smuggling activities, such as uneven distribution of the region. How to further improve the processing trade benefits of the dynamic expansion of China's foreign trade export, and enhance China's overall national strength has important significance.This article focus on integrating theory with practice, qualitative analysis and quantitative analysis. The article is divided into four chapters. The first chapter is the introduction, a brief description of the background of subjects to study at home and abroad as well as the significance of relevant research results. ChapterⅡ, from a practical point of China's processing trade to analyze the current situation, an analysis of the development of China's processing trade benefits and problems in the back of the empirical analysis of the need to lay a theoretical basis.ChapterⅢis the core of this paper is mainly focused on processing trade on the effect of, and in accordance with the 1991 to 2006 between the relevant statistical data on the effect of China's processing trade of the three channels had a role in empirical analysis. The positive test was mainly used co-integration test from the quantitative point of view that the multiplier effect through the processing trade, employment effects of industrial upgrading effect on the extent of the impact of China's national economy. ChapterⅣ in order to further improve benefites of China's processing trade measures put forward a proposal.