Empirical Analysis Of Sino Russian Trade Complementarity And Potential Of Development

As two economic powers,China and Russia are geographically adjacent.They both have geographical advantages,relative stability of the political relationship.Besides,the two countries have complementary advantages in the production factor endowments,industrial structure,import and export structure of the products and other aspects,so the two countries have favorable conditions and great advantages for the development of bilateral trade.In recent years,the Sino Russian trade constantly set high record.For example,in 2001 Sino Russian trade for the first time exceeded 10 billion dollars,after which the trade of these two countries has stepped into a sustained and rapid development period.The total volume of bilateral trade has been rising.By the end of 2014,the trade between China and Russia has reached 95.28 billion dollars,an increase of 6.8%,China has become the largest trading partner of Russia.But the truth is that the trade relationship of the two countries has remained at a relatively low level in spite of their rapid trade development.The Sino Russian trade has not fully reflected their comparative advantages.Their bilateral trade still has a strong complementarity and great development potential.Therefore,according to the related trade theories,including theory of absolute advantage,theory of comparative advantage and factor endowment,firstly this paper theoretically analyzes the situation of trade development and the complementary conditions between China and Russia,then makes an empirical analysis on the complementarity relationship between the two countries,using trade intensity index,revealed comparative advantage index and trade complementarity index based on the data collected from 2004 to 2014,lastly the paper calculates bilateral trade development potential by building gravity model.The paper draws the following conclusions:(1)As a result,China and Russia have a strong trade complementarity especially in the fields of labor,technology and energy,due to their differences in production factor endowments.In addition,China and Russia are complementary in the industrial structure,import and export structure of products,and other aspects.(2)China and Russia are closely related in trade,China has a comparative advantage in labor-intensive light industry products and machinery and transport equipment,while Russia possesses more obvious advantages in the mineral,energy and other resource intensive products.(3)China and Russia have strong complementarity in respective products in which each of them has comparative advantages,what's more,the complementary index is increasingly raised.(4)China and Russia have great potential for trade development.Finally,according to the research conclusions,this paper puts forward the measures to further strengthen the trade development between China and Russia.Specific suggestions are as follows:(1)To establish a free trade zone of Sino-Russia.(2)To regulate the trade orders of China and Russia,break down the barriers relating customs duties,technology and customs clearance process and establish integrated laws and regulations of bilateral trade.(3)To optimize the structure of Sino-Russian trade,deepen trade cooperation in such fields as energy,mechanical and electrical industries,and high-tech industries.(4)To improve the Sino-Russian trade service systems,optimize the international logistics system,clear the channels for the development of local currency settlement and make the best endeavors to train professional personnel.