A Study On The Comparison Between China-EU And China-ASEAN Trade

Since the implementation of Reform and Opening-up Policy, China has been actively integrating into the global division of labor and becoming the manufacturing and trading center of the world. In addition to the rapid increase in trade volume, China has fatherly strengthened the connection with foreign markets. For example, two major regional economic groupings, European Union and ASEAN, has become China’s important economic partner. The European Union has always maintained the status of China’s largest trading partner, and it has been nearly a decade since1994, while ASEAN’s trade with China maintain a rapid growth and has become China’s third largest trading partner in recent years. As the two most robust economic bodies in the world, EU and ASEAN share a lot of features while presenting their respective characters, so the research on the difference of China-EU and China-ASEAN Trade not only brings some inspiration on this field of study, but also provide significant guidance on the trade policies.EU-China trade and China-ASEAN trade have always been a hot research topic of international trade theory. When explore bilateral trade relations and characteristics, academia usually relies on classical trade theory like theory of comparative advantage and intra-industry trade theory to explain the reasons of the rapid development of trade. Scholars have also gradually formed some new ideas by combining the changing policy situation in the international trade market in recent years. As for this issue of the influencing factors of trade, academia fully consider the characteristics of the European Union and the ASEAN as regional economic integrations, and develop their study under the Viner-Meade framework, which is based on the theoretical basis of trade creation and trade diversion effect. As a result, China, as a non-member of the EU and a member of CAFTA, show different trade characteristics during the trade process with these two economic groups.In the empirical test of the characteristics of China’s trade with EU and ASEAN, academia use various index and empirical methods based on the pattern of trade and test the competition and complementarities of bilateral trade through the analysis of the empirical results. On the other hand, multiple regression testing and gravity model are widely used in the empirical test of the trade influencing factors, such as GDP, FDI; some other scholars closely follow the trend of the times, and have made keen analysis according to the actual situation on the volatility of trade market. Moreover, with the establishment of the China-ASEAN Free Trade Area, many scholars have also investigated trade effects of CAFTA towards the economies of China and ASEAN through empirical testing.This paper. firstly, summarizes and sorts out the theoretical and empirical researches which are related to the bilateral trade between China and the other two economic groups, and further make comments of merits and demerits on those studies. Secondly, on the basis of current situation of bilateral trade, this paper makes analysis and comparison from every aspect of the trade and provides its own interpretation in terms of all these differences. Thirdly, this paper applies the international trade panel data from2005to2011regarding to the information of China, EU and ASEAN to make empirical test. By selecting the trade effects of the above-mentioned factors, this paper constructs the Gravity Model on EU-China trade and China-ASEAN trade, and examines different groups’ degree of sensitivity on influencing factors. After thoroughly understanding the test results, a profound explanation will be provided in terms of different coefficients on the same independent variables. Lastly, based on its findings, this paper will forecast and outlook the future of ASEAN and EU trade development with China, and propose differentiated policy.