Study On The Effect Of Trade Facilitation On The Export Sophistication Of Agricultural Products

Promoting trade facilitation and enhance the technological content of export trade are the key contents of the construction of “the Belt and Road”.Since China’s entry into the Word Trade Organization,China has actively integrated into the process of economic globalization and participated extensively in the international division of labor,which has achieved rapid development of foreign trade.Not only has China’s trade value of agricultural products continued to expand,but also its export sophistication of agricultural products improved significantly.However,Chinese agriculture is still at the bottom of the "smile curve" of the global agricultural value chain.As trade protectionism in the United States heats up and the trade conflicts between China and the United States continue to spread,agricultural trade of China is facing greater challenges.Expanding opening up and enhancing the international competitiveness of agricultural products as the effective response,China needs to continue to deepen the cooperation along "the Belt and Road",shape a fair competed and legalized,international and convenient business environment to create a mutually beneficial and win-win regional economic cooperation model.However,the countries or districts along “the Belt and Road” have large differences in policy orientation,infrastructure,information services and cultural backgrounds.The large gaps greatly increase the cost of trade and hinder the convenience and smoothness of trade which will affect export depth and breadth and hinder the changes in the development mode of foreign trade.Therefore,in the context of “the Belt and Road” initiative,this article explores how to promote trade facilitation to reduce transaction costs which expand trade scale and improve export quality,thereby increasing the technological content of agricultural export and promoting the upgrading of agricultural industry chain to make a high-quality development of trade in China and countries(or districts)along “the Belt and Road”.The main research contents of this article include: First,based on a review of related theories such as Transaction Cost Theory and New New Trade Theory and related literature,through mechanism analysis and mathematical model derivation,the mechanism of trade facilitation on the export sophistication of agricultural product is be explored;Second,index analysis and comparative analysis are used to measure the export sophistication of agricultural products and trade facilitation level of China and countries(or districts)along “the Belt and Road” from 2011 to 2018,then the comparative analysis between countries and regions is carried out.Third,a static panel data fixed effect model and a dynamic panel data system GMM model are constructed to empirically estimate the impact of comprehensive indicators of trade facilitation and each level of indicators on the export sophistication of agricultural products,which in case to clarify the role of unimpeded trade and so on in improving the quality of agricultural exports and optimizing the structure.Based on the above analysis,this article mainly draws the following conclusions:(1)(1)From 2011 to 2018,the overall agricultural trade between China and the countries(or districts)along “the Belt and Road” has continued to develop,and the trade volume and export sophistication have continued to increase.The export sophistication of different types of agricultural products is significantly different.The main manifestation is that the flows of agricultural trade in Southeast Asia is significantly higher than in other regions,and the export sophistication of agricultural exports in West Asia and North Africa is much higher than that in South Asia,while the export of processed agricultural products has the highest technical content,and other agricultural products such as horticulture are lower.Compared with the countries(or districts)along “the Belt and Road”,China is a large agricultural trade country.The export sophistication of agricultural exports in China is higher than the overall average level of the countries(or districts)along “the Belt and Road”,and it maintains an upward trend.(2)Generally speaking,trade of China and the countries(or districts)along “the Belt and Road” are at a level of “inconvenient”.Although it steadily increases between 2011 and 2018,the gap in the level of trade facilitation between different countries and regions is big.In terms of different regions,the level of trade facilitation in West Asia and North Africa is the highest,followed by Central and Eastern Europe and Southeast Asia,which are significantly higher than in Northeast Asia,South Asia and Central Asia.Regarding the components of trade facilitation,the scores of customs environment and regulations are basically stable from 2011 to 2018,and the score of e-commerce showed a clear upward trend,eventually surpassing the infrastructure with the highest scores.China’s score of customs environment,regulations and infrastructure are higher than the average level of the countries(or districts)along “the Belt and Road”.(3)Increasing the level of trade facilitation has a significant positive impact on the export sophistication of agricultural products in China and countries(or districts)along “the Belt and Road”.From the four aspects of trade facilitation,each component has different effects on the export sophistication of agricultural products.Among them,the convenience of ecommerce has the most apparent effect on promoting the export sophistication of agricultural products,followed by regulations and infrastructure,while the impact of customs environment on promoting the export sophistication of agricultural products is not significant.Based on the above research conclusions,this article puts forward policy recommendations to promote the steady increase in the export sophistication of agricultural products in China and countries(or districts)along “the Belt and Road”:(1)Establish a standard and sound institutional system and create good business environment;(2)Improve infrastructure construction to achieve sea,land and air connectivity;(3)Promote the development of e-commerce and form a mutually beneficial trade network;(4)Strengthen human capital investment to improve the quality of agricultural workers;(5)Enhance the degree of opening up to promote frontier technological advances in agriculture.