A Geospatial Analysis of China's Exports, 1991-2008

Three Taiwan-based economists employ a range of exploratory spatial data analysis tools (e.g., Moran's I and LISA statistics) to investigate trends in the growth of China's exports over the period 1991-2008. A particular focus is on the detection of spatial correlations between China and 40 export destination countries in major world regions. Emphasis in the paper on the key years of 1991, 2001, 2006, and 2008 has enabled the authors to analyze the impacts on China's trade of such major events as the country's accession to the World Trade Organization and the global economic crisis of 2008-2009. The results of the spatial analysis reveal the continuing importance of the U.S. and Asian countries in China's export trade (despite changes in the character of trade relations) and identify the spatial outliers (e.g., in Latin America) that may serve as the basis for new export markets for China in the future.     

China's Exports and Imports of Agricultural Products under the WTO

An American economic geographer specializing in the agricultural sector of China's economy presents a study of that country's trade in agricultural products. The paper is focused on patterns of change in the regional distribution of agricultural and aquacultural exports and imports before and after China's accession to the World Trade Organization in 2001. Drawing on research during the course of a field trip in July 2008 and utilizing data compiled by China's Customs Bureau, the author provides a comprehensive assessment of the country's trade with 10 major world regions through the year 2007. Journal of Economic Literature, Classification Numbers: F14, F40, O13, Q17. 1 figure, 4 tables, 32 references.     

The Impact of Global Financial Crisis on the Mechanism of Economic Growth in Russia

A noted specialist on the Russian economy presents an assessment of the impact of the global financial crisis on the mechanism of the country's economic growth. Focusing on the demand side of the economic ledger, the author explores the question of whether Russia will be able to re-attain the high economic growth rates of the period from 2000 to 2007 after recovering from the crisis. The paper analyzes the sharp drop in production in 2008 and the first quarter of 2009, attributing most of the damage to liquidity problems and declines in the price of oil. Empirical evidence is based primarily on data collected by the author from the Central Bank of Russia and the country's federal bureau of statistics (Rosstat). Journal of Economic Literature, Classification Numbers: E010, E200, E660, F210, G010. 11 figures, 3 tables, 29 references.     

Foreign Trade in China's Electronics Industry

Three Taiwan-based economists examine the effects of GDP, per capita GDP, geographic distance, FDI outflows and inflows, openness to trade, bilateral investment treaties, and other factors on the volume of bilateral trade between China and 40 of its trading partners in the up-, mid- and downstream segments of the country's electronics industry. Pooled cross-section and time-series data are employed in an empirical estimation for the period 1995-2005, which indicate that the Chinese electronics sector's import/export volumes have grown substantially alongside China's economy. The authors address a specific set of issues questioning whether FDI inflows have created a trade effect in the electronics industry, whether they have lead to a measure of import substitution in China's electronics industry, and whether the net impact of opening the market has been positive or negative on the sector's foreign trade. Journal of Economic Literature, Classification Numbers: F14, F21, L63, O53, P33. 6 tables, 23 references.     

China's Energy Future: A Framing Comment

A noted Hong Kong-based specialist on China's energy industries presents a comment on three papers comprising a symposium on that country's rapidly expanding oil, natural gas, and nuclear power sectors. He frames his observations around five overarching themes that have shaped China's energy sector development over recent decades and will continue to do so in the future. These include observations to the effect that: (a) China's energy policy seeks broadly similar objectives to those of other countries; (b) the country's energy resource endowment is not particularly rich when viewed in relation to the size of its population; (c) its energy mix continues to be dominated by coal, with important implications for the environment and domestic freight transportation; (d) the country's economy is confronting a pronounced spatial mismatch between the location of energy resources and the markets where they are consumed; and (e) strategies for energy developments in China are closely tied to overriding political and economic concerns at any given point in time.     

China's Exchange Rate Controversy: A Balanced Analysis

A noted American authority on China's economy and monetary policy presents a statistical as well as theoretical analysis of a variety of perspectives on the controversy surrounding China's currency, basing his paper on both. The author provides the historical background and comprehensive summaries, focusing on different viewpoints about whether China's currency is undervalued, and thus may contribute to global imbalances. In the paper, he divides observers involved in the controversy into two main camps, namely the ones who find China's trade balances to be sensitive to price effects through exchange rate adjustments and those who emphasize other factors as bearing the responsibility for China's large surpluses, including the U.S. credit bubble emerging before the global financial crisis, as well as a version of Dutch disease.     

The (Ineffective) Financial Statecraft of China's Bilateral Swap Agreements

Since 2008, the People's Bank of China has signed bilateral swap agreements (BSAs) with 35 foreign central banks. Collectively, these deals amount to nearly US$ 500 billion in Chinese renminbi (RMB) available to Beijing's foreign partners. What has led China to be so aggressive in its efforts to sign so many swap agreements? What are the political economic implications of the swap programme for the US‐centric global economic order? China's BSAs can be understood as a form of financial statecraft: the use of national financial and monetary capabilities to achieve foreign policy ends. China has deployed BSAs for both defensive and offensive reasons. Defensively, Beijing has sought to use BSAs to promote trade settlement in RMB thereby reducing China's vulnerability to the dollar's structural dominance in trade. Yet, as explained in this article, they have been ineffective in this regard. Offensively, Beijing has used BSAs as a short‐term liquidity backstop outside of the Bretton Woods institutions for partner countries in need. Here, there is greater potential for BSAs to impact the status quo economic order by enhancing Chinese economic influence. However, their potential is dependent on Beijing's willingness to act as a unilateral crisis lender and its ability to further internationalize the RMB.     

Observations on the Influence of High Oil Prices on Russia's GDP Growth

A noted economist and observer of post-Soviet affairs presents a study probing the influence of high oil prices on Russia's GDP growth. The paper analyzes the contributions to the country's GDP by sectors of origin and final use, and pays special attention to the influence of trade margins produced by oil and gas but recorded and placed by Goskomstat Rossii in Russia's trade sector. The author's interpretation of statistical data released by Goskomstat Rossii as well as by Russian customs authorities enables him to conclude that the present-day economic boom in Russia can be characterized as consumption-led growth fueled by oil and gas export revenues. Journal of Economic Literature, Classification Numbers: C67, C82, E23, L71, Q43. 2 figures, 10 tables, 20 references.     

Reassessing Human Geography in the Wake of China's Rise

A prominent human geographer, introducing a series of papers in a Eurasian Geography and Economics mini-symposium devoted to China's emergence, surveys the myriad global impacts of that country's rapid recent rise. The topics covered include the economic (i.e., rapid growth in the size of China's economy, preeminence as an exporter of manufactured goods, and role as a major natural resource consumer, overseas investor, and purchaser of U.S. debt obligations), the geopolitical (increasing involvement in international organizations, rising assertiveness in defense of territorial claims), and the environmental (e.g., carbon footprint, accelerated urbanization, dam building), as well as the implications of China's rise for the study of geography and development. He argues that assessment of the consequences of the country's emergence should not be based on simple extrapolation of present trends, but must take into account a number of looming questions relating to the competitiveness of China's manufacturing labor force (vis-à-vis other developing countries), capacity to innovate (as well as imitate), and transformative societal impacts of modernization and development.     

China's Energy Security: Challenges and Priorities

In a companion paper to the essays comparing China's and India's economic rise (Prime, 2009) as well as India's energy security (Dadwal, 2009), two specialists on China's energy industries review the country's challenges posed by the need to dramatically increase energy use in order to support economic growth while coping with pressures to reduce environmental impacts from emissions of greenhouse gases. After reviewing the current mix of fuels in the economy and discussing each major energy resource (in terms of proven reserves, production, consumption, and foreign import requirements), the authors focus on measures undertaken by the Chinese government and corporations to improve access to vital supplies. The paper covers efforts to enhance the country's energy security, which include diversifying sources of oil supply, purchasing oil and gas concessions and financing of energy infrastructure development in African and Central Asian countries, instituting reforms to encourage more efficient energy use, and developing alternative energy sources. Journal of Economic Literature, Classification Numbers: O130, P280, Q400. 7 figures, 2 tables, 82 references.     

Sustaining China's Economic Growth: New Leaders,New Directions?

An American specialist on the economy of China assesses the options and obstacles the country's new leadership will face as it attempts to sustain the current economic growth trajectory in the future. Putting the current situation in historical context, the author first reviews the reforms leading up to the agenda advanced by the previous leadership team (led by Hu Jintao) and then examines the health of China's economy in late 2012 (a situation she argues is characterized by the exhaustion of three key drivers of growth). The paper advances the thesis that further reforms and improvements in technology will be essential to sustained growth, and that additional reforms will be necessary before sustained innovation can take root. As signs of successful further reform going forward, readers are advised to look to increased private-sector legitimacy, a decline in state-sector monopoly power, and strengthening of legal foundations for reform policies.     

China's "Dash for Gas": Challenges and Potential Impacts on Global Markets

Two UK-based researchers examine the significant recent growth in China's demand for natural gas, a fuel not long ago considered of marginal importance but now viewed as critical for the country's future economic growth. Based on a range of databases as well as industry and media reports, the authors demonstrate how rapid demand growth since 2005 has transformed China from a minor, self-sufficient gas producer to a major buyer on international gas markets. They also analyze projections for future demand growth (25 years), showing China's demand for gas will grow faster that anywhere else in the world, and explore the potential for development of China's substantial domestic gas reserves to mitigate import demand over the short to medium term. The study concludes with an assessment of China's potential impact on global gas markets over short, intermediate, and long time horizons.     

China's New Generation of Leaders and Regional Challenges in East Asia

A pair of Hong Kong and U.S. specialists on China examines the dynamic international environment China's new leadership now faces, focusing on East Asia. They first examine the complex balance the leadership seeks to strike between: (1) China's projection of increasing economic, military, and political power internationally; (2) the primary domestic goals of economic growth and stability; and (3) rising public awareness, demand for information access, and (in some quarters) nationalism among the Chinese people. The authors then proceed, in successive sections of the paper, to assess in greater detail China's international and regional security environment, Sino-American relations, China's relations with its East Asian neighbors, and the complex interconnections between the country's domestic and foreign policy. They conclude that Sino-American relations will continue to be pivotal to Beijing's foreign relations in general and its relations with countries in the East Asian region more specifically.     

Debating Belarus: An Economy in Comparative Perspective

A U.S.-based geographer and Belarusian political scientist assess the current economic crisis in Belarus. Although the country's financial situation is serious in the short term, they argue that analysis of basic social and economic indicators provides some evidence of underlying strength and stability, recently bolstered by a number of trade agreements concluded with Russia in late 2011. The authors argue that the most natural and meaningful basis for ascertaining the health of the country's economy is to compare it with those of its two Slavic neighbors, Russia and Ukraine. That comparison reveals that although Belarus ranks lower on most indices of economic reform, it has outperformed them during the post-Soviet period in several important categories (GDP growth, income equality, agricultural productivity, expenditures on education and health care, life expectancy, and per capita agricultural output) and occupied an intermediate position (below Russia but above Ukraine) in others (e.g., GDP per capita, wages and pensions, and labor productivity). The paper's final section discusses the nature of the relationship between Belarus and Russia (dependence vs. complementarity) and that between the Lukashenka regime and the Belarusian people.     

Regional Analysis of China's Green GDP

A Chinese economist and U.S.-based economic geographer investigate China's move toward introducing "greener" measures of economic output to better assess the environmental costs associated with the country's recent economic development. More specifically, the authors applied a model of green gross regional product (GGRP) that adjusts for the costs of growth arising from negative environmental externalities. They then conduct a spatial analysis of the indicator's distribution across China's provinces in 2007 in an attempt to better understand the factors explaining its patterns. The analysis indicates that once environmental externalities in the form of industrial wastes are accounted for, the coastal—inland divide that traditionally describes China's geography of income inequality is much less obvious. Rather a more diffuse pattern emerges, in which some poor provinces are found to be relatively efficient regional producers whereas certain wealthier ones are not.     

China Gazes West: Xinjiang's Growing Rendezvous with Central Asia

A senior American specialist on the geography of China surveys that country's enduring interest and involvement with the former Soviet republics of Central Asia, increasingly on the basis of Xinjiang's role as a bridgehead for economic linkages. Among the key features of this growing involvement reviewed in the paper are the establishment in 2001 of a regional security alliance (Shanghai Cooperation Organization) to combat Islamist extremism as well as separatist activities; growing commercial linkages (especially with Kazakhstan, Kyrgyzstan, and Tajikistan) in tandem with improved transport links and increasing crossborder movements of merchants, traders, and tourists; and China's growing need for oil and increasing reliance on Kazakhstan as a key source for petroleum. China's growing engagement with Kazakhstan and other Central Asian countries is examined within the context of both opportunities as well as challenges, the latter reflecting the increasing complexity of Han Chinese and Uyghur/Turkic relations owing to increased Uyghur ties to affiliated populations in the Central Asian states.     

Development of Local Financial Systems in Mainland China

Two Beijing-based economic geographers present a comprehensive study of local financial systems in China. The paper analyzes the most recently available (2006) regional data on exogenous (state-owned, foreign-owned, and joint shareholder-owned) and endogenous (city commercial banks and rural credit cooperatives) banks, highlighting the differences between the country's coastal and the lagging rural provinces located in China's central and western macroregions. A key component of the analysis is the geographic distribution of bank branches and assets. Special attention is devoted to Shanghai, the country's traditional financial center, which has attracted the bulk of foreign-owned banks and financial service providers seeking entry into the vast Chinese market. Journal of Economic Literature, Classification Numbers: G21, G28, O18, P34. 9 figures, 3 tables, 54 references.     

Failed Eastern integration and a partly successful opening up to the West: the economic re-orientation of Hungary during the 1970s

The article investigates the ‘long 1970s’ (1968–82), when Hungary re-orientated its economic and foreign-trade relations. Hungary was always a promoter of a deepening of Council for Mutual Economic Assistance (CMEA) co-operation and when it noticed that socialist integration stagnated at the level of the bilateral exchange of commodities, Budapest gradually launched a policy of opening up to the world outside the CMEA. The year 1977 was a turning point in economic policy. Hungarian elites' thought and attitude towards the West changed, but not independently of the world economic crisis and its impact on Hungary. The oil crisis sharpened latent tensions, and behind the robust growth serious problems appeared. Although Hungary intensified its interrelations with the West and the Third World, the country was not able to profit from the advantages of international trade and co-operation. The article is based on state, party and senior economic leaders' archives.     

Ukraine's Financial Crisis, 2009

A prominent specialist in the economic affairs of the former Soviet Union relates and analyzes the state of Ukraine's economy in light of a series of discussions and interviews with the country's Prime Minister and leading economic officials in Kyiv in 2008 and April 2009. The author, a former economic advisor to the country's government and co-chair of the UN's Blue Ribbon Commission for Ukraine, devotes this paper to a penetrating analysis of the impact of the global financial crisis of 2008-2009 on Ukraine's budget, banks, exchange rates, money supply, industrial sectors (particularly energy and steel), GDP, and inflationary pressures. Due attention is given to economic relations with the EU and Russia as well as to financial assistance from the IMF.Journal of Economic Literature, Classification Numbers: E500, E600, O520, P200. 1 table, 4 figures, 38 references.     

The economic factor in the Sino-Vietnamese split, 1972–75: An analysis of Vietnamese archival sources

Relying on so far untapped Vietnamese archival sources, this article examines the impact of China's gradual curtailment of its economic assistance to the Democratic Republic of Vietnam's (DRV) war and economic recovery efforts and its implications for Sino-Vietnamese relations between 1972 and 1975. While Beijing's gradual reduction of aid to the DRV during this period was primarily motivated by the declining importance of North Vietnam to China's strategic security combined with the reality of China's domestic economic hardship which largely resulted from the disastrous Cultural Revolution of 1966–69, Hanoi's reactions and policy responses were driven by their deep-rooted perception of Beijing's insincerity and hidden intention to keep Vietnam weak. The Sino-Vietnamese conflict that ensued after 1975 was not inevitable; Hanoi's leaders launched concerted diplomatic efforts to improve economic relations with Beijing throughout 1975 because they clearly recognised the importance of China's continued economic assistance and preferential trade agreements to its first five year plan (1976–80). However, Beijing's unchanged position and hasty decision to totally cut off aid to Vietnam and additionally take punitive economic measures against Vietnam's first five-year plan in late 1975 while at the same time increasing economic and military aid to the Democratic Kampuchea compelled Hanoi to tilt closer towards Moscow.