The Problems And Countermeasures On Transformation And Upgrading Of Processing Trade In China

Processing trade is developed on the basis of the comparative advantage theory. It is a mode of trade that one developing county uses its comparative advantage of labor cost to attract developed countries to invest in order to develop its economy. China's processing trade started in 1979.With the economic development, the process of economic globalization quicken and the internationalization of production broaden, processing trade of our country develops by leaps and bounds. Since 1996, processing trade has occupied half of China's total foreign trade volume and made great contribution on reducing the employment pressure, foreign trade development, industrial restructuring and upgrading and so on. However, financial crisis made a severe blow to China's processing trade. After the financial crisis, RMB is facing the pressure of appreciation, trade frictions are aggravating, and new trade protectionism is rising. At the same time, the cost of labor and raw materials is rising and the low-carbon economy is proposed in the world. The internal and external factors are seriously hindering the development of processing trade. Besides, the processing trade itself exists certain problems that can't be ignored, such as high pollution and high consumption, concentrated on labor-intensive industry, dominated by foreign-invested enterprises, low value-added products, imbalance in regional distribution, lack of capacity for independent innovation. These factors make the transformation and upgrading of processing trade face a severe test. In 2009, the processing trade experienced the first negative growth after 30 years of sustained growth. In 2010, the proportion of China's processing trade in China's foreign trade dropped to 38.9%. At present, processing trade still plays an important role in participating in international division of labor and foreign trade. According to current domestic and international situation and the development of processing trade itself, the process of transformation and upgrading must be accelerated to play an effective role in promoting economic development of our country.This article analyzes the problems in the process of transformation and upgrading of processing trade and put forward some reasonable measures. The logic of this article is structured as follows:The first part is the preface. It analyzes the underground and significance of transformation and upgrading of processing trade and makes analysis and summary on the problems of processing trade from domestic and foreign scholars. Besides, it proposes the innovations and drawbacks of this article.The second part defines related concepts of transformation and upgrading of processing trade and proposes the theory basis of transformation and upgrading of processing trade. It mainly analyzes the Ricardo's theory of comparative advantage, Gradient transfer theory, and Porter's value chain management. This lays theoretical foundation for below.The third part elaborates on processing trade's contribution to economic development. It mainly analyzes the great contribution of settling employment problems, improving the quality of labor, foreign trade development, industrial restructuring and upgrading, industrialization.The fourth part makes specific analysis for the current situation of processing trade in two aspects of scale and structure. It uses large amounts of data, tables and graphics.The fifth part analyzes the current problems of processing trade in post-crisis era. Based on the fourth part, it points out some main problems of high pollution and consumption, lack of capacity for independent innovation, imbalance in regional distribution, low value-added products, increasing trade friction and so on.The sixth part raises specific and applicable polices and measures according to the fifth part. For example, promote processing trade industry to transfer to central and western regions, increase the proportion of domestic enterprises and so on.The seventh part is the conclusion that makes a brief summary of this paper.