Determinants of China's energy imports: An empirical analysis
AbstractSustained economic growth in China has triggered a surge of energy imports, especially oil imports. This paper investigates the determinants of Chinaâs energy import demand by using cointegraiton and VECM techniques. The findings suggest that, in the long run, growth of industrial production and expansion of transport sectors affect Chinaâs oil imports, while domestic energy output has a substitution effect. Thus, as the Chinese economy industrializes and the automotive sector expands, Chinaâs oil imports are likely to increase. Though Chinaâs domestic oil production has a substitution effect on imports, its growth is limited due to scarce domestic reserve and high exploration costs. It is anticipated that China will be more dependent on overseas oil supply regardless of the world oil price.
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Bibliographic InfoArticle provided by Elsevier in its journal Energy Policy.
Volume (Year): 35 (2007)
Issue (Month): 8 (August)
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Web page: http://www.elsevier.com/locate/enpol
Other versions of this item:
- Xingjun Zhao & Yanrui Wu, 2007. "Determinants of China’s Energy Imports: An Empirical Analysis," Economics Discussion / Working Papers 07-03, The University of Western Australia, Department of Economics.
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