Research On The Influence Factors Of China’s Export Growth With CAFTA Based On Gravity Model

Nowadays, financial crises have not been over yet, trade protectionism has been continued to rise. Free Trade Area is an important cooperation platform to against risks and for countries among Free Trade Area. The establishment of China-ASEAN Free Trade Area(CAFTA) will help to further reduce trade barriers. Its integration process and the level is very far-reaching and broad. Both China and ASEAN countries will benefit from the establishment of CAFTA. It has exert a profound impact on Asia and the world’s pattern as well as accelerated the pace of China’s regional cooperation. It’s a trend of economic globalization. The establishment of CAFTA can not only reduce the dependence to United States、Japan and European market but also help to China’s export market diversification strategy process.This article studies the various factors that can influence the volumes of export trade between China and Association of Southeast Asian Nations in order to find how these target factors and what extent influence bilateral export trade. This paper aims to put forward some recommended policies on healthy and lasting multilateral relations after China’s participation in CAFTA.This paper starts from the introduction and inter relationships of China-ASEAN Free Trade Area. Then Introduce industries and products with comparative advantages of these respective countries as well as trade competition and complementarity in both content of markets and products. Next, conduct empirical test based on trade gravity model. The empirical study shows that, the ratio of trading partner and the scale of China’s economy as well as the absolute value of trading partner’s GDP per capita minus China’s GDP per capita exert the most important effects on the China’s export to ASEAN; China’s FDI to ASEAN and common language exert positive effects on the China’s export to ASEAN; The geographical distance exerts negative effect on the export of China to ASEAN. Therefore, to promote a sustained and healthy development of China’s export to ASEAN, we can’t generalize in developing international markets. Taking unique strategies based on the characteristics of respect markets is appropriate. Finally, propose the corresponding policy recommendations.