Empirical Analysis On The Main Influencing Factors Of Terms Trade Of China’s Primary Products

Since the21st century, the production and trade of primary products haveattracted widely attention renewed all over the word. As the basis and foundation ofthe domestic economic sustainable development, the status of primary productshighlights the importance of the primary products in the international trade. Alongwith the rapid economic development and industrialization accelerates, the demand ofprimary products is increasing, especially the resources and energy products. Inaddition, China has been become a net importer of primary products. Terms of tradeare important indicators that measure the benefits of one country in participating inthe international trade. It is always been the hot issue in the research on internationaltrade. Therefore, this paper focuses on the primary products terms of trade as theobject and analyze the main influencing factors to the terms of trade from thetheoretical and empirical perspectives.This paper has several parts as follows:PartⅠ: review and evaluate the relevant references home and abroad on terms oftrade, it is the basis of the following analysis.Part Ⅱ: analyze theoretically the main factors that influence on the terms oftrade of primary products, and then expounds the mechanism of factors in details.Part Ⅲ: summarize the present situation of the primary products in internationaltrade and the changing trend of the terms of trade of the primary products. The tradescale of primary products has extended in recent years. The NBTT has declined andthe ITT has been improved.Part Ⅳ: analyze empirically the influencing factors of the NBTT. The resultsshow that the economic growth in agriculture and the changes of market demandshave negative influences on the NBTT, while FDI in agriculture and tariff havepositive influences.Part Ⅴ, put forward some suggestion according to the empirical results toimprove the terms of trade of the primary products.