Since 2014
An Analysis of Interaction Effects of China–South Korea and China– Australia FTAs and the Expanding TPP
Journal of Contemporary Issues in Economics and Business
View Archive Info| Field | Value | |
| Title |
An Analysis of Interaction Effects of China–South Korea and China– Australia FTAs and the Expanding TPP
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| Creator |
Yuhong, Sun; Dongbei University of Finance & Economics, College of International Economics & Trade Yifei, Mu; Dongbei University of Finance & Economics, College of International Economics & Trade Yang, Jun; University of International Business and Economics |
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| Subject |
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China–South Korea FTA, China–Australia FTA, TPP, interaction effects |
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| Description |
On 5 October 2015, the Trans-Pacific Partnership Agreement (TPP) led by the U.S.was signed. Already, 12 countries1 have joined the agreement, but China has not.Thus, lots of research has focused on the negative effect of the TPP on China’sforeign trade. On the other hand, China is moving forward in its own efforts toestablish bilateral free trade agreements (FTAs) and free trade zones. In June2015, China–South Korea and China–Australia signed bilateral FTAs which wentinto effect in December 2015. Several questions were raised: Since South Koreaand Australia are the major trade partners in the Pacific area and the bilateralFTAs will be effective before the TPP, will these FTAs’ positive effects on China’sforeign trade offset some of the negative effects of the TPP? If China and theU.S. adopted a competitive trade policy, which countries would benefit? If Chinaand the U.S. adopted a cooperative trade policy, how would the trade value andeconomic welfare change? This paper simulates and analyses the mutual effectsof China–South Korea and China–Australia FTAs and the enlarging TPP using thecomputable general equilibrium model. The major conclusions drawn suggestthat China–South Korea and China–Australia FTAs will significantly offset theTPP’s negative effect on China’s foreign trade. If China is not included, the U.S.economic benefit from the TPP will be limited. The economic welfare for a countrylike Australia, which joined both the bilateral FTA and the TPP, will be increasedthe most. In the long run, China joining the TPP would be the most beneficialdecision for its national interest. However, if the TPP cannot be approved by the UScongress, the U.S.’s economic indicators and export would be decreasing sharply.China’s economy and export will benefit from FTAs.
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| Publisher |
Faculty of Economics and Business
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| Contributor |
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| Date |
2016-12-15
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| Type |
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion — |
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| Format |
application/pdf
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| Identifier |
http://ng-epf.si/index.php/ngoe/article/view/127
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| Source |
Naše gospodarstvo/Our economy; Vol 62, No 4 (2016); 12-22
2385-8052 0547-3101 |
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| Language |
eng
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| Relation |
http://ng-epf.si/index.php/ngoe/article/view/127/116
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| Rights |
Copyright (c) 2017 Naše gospodarstvo/Our economy
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