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China’s Competitive Performance: A Threat To East Asian Manufactured Exports?

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  • Sanjaya Lall and Manuel Albaladejo (QEH)

Abstract

There is growing concern in Southeast and East Asia about the competitive threat posed by China’s burgeoning exports, exacerbated by its accession to the WTO. The threat is not confined to labour-intensive products but spans the whole technological and skill range. At the same time, China is rapidly raising its imports from the region, and it is not clear whether its burgeoning exports will damage its neighbours. We examine the dimensions of China’s competitive threat in the 1990s, benchmarking competitive performance by technology and market, and finds that market share losses are so far mainly in low technology products, with Japan being the most vulnerable market. We analyse market share changes and highlight product groups that are directly or indirectly exposed to a competitive threat. We examine intra-regional trade and find that China and its neighbours are raising high technology exports in tandem: the nature of the international production systems involved lead to complementarity rather than confrontation. China is thus acting as an engine of export growth for its neighbours in terms of direct trade. However, this will change as China moves up the value chain and takes on the activities that have driven East Asian export growth

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Paper provided by Queen Elizabeth House, University of Oxford in its series QEH Working Papers with number qehwps110.

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Handle: RePEc:qeh:qehwps:qehwps110

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  1. Dieter Ernst, 2002. "Global production networks and the changing geography of innovation systems. Implications for developing countries," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 11(6), pages 497-523.
  2. Françoise Lemoine & Deniz Ünal-Kesenci, 2002. "China in the International Segmentation of Production Processes," Working Papers 2002-02, CEPII research center.
  3. Ianchovichina, Elena & Martin, Will, 2001. "Trade liberalization in China's accession to the World Trade Organization," Policy Research Working Paper Series 2623, The World Bank.
  4. Arndt, Sven W. & Kierzkowski, Henryk (ed.), 2001. "Fragmentation: New Production Patterns in the World Economy," OUP Catalogue, Oxford University Press, Oxford University Press, number 9780199243310, October.
  5. Ng, Francis & Yeats, Alexander, 1999. "Production sharing in East Asia : who does what for whom, and why?," Policy Research Working Paper Series 2197, The World Bank.
  6. Gereffi, Gary, 1999. "International trade and industrial upgrading in the apparel commodity chain," Journal of International Economics, Elsevier, Elsevier, vol. 48(1), pages 37-70, June.
  7. Elena Ianchovichina & Terrie Walmsley, 2005. "Impact of China's WTO Accession on East Asia," Contemporary Economic Policy, Western Economic Association International, vol. 23(2), pages 261-277, 04.
  8. Ernst, Dieter & Kim, Linsu, 2002. "Global production networks, knowledge diffusion, and local capability formation," Research Policy, Elsevier, Elsevier, vol. 31(8-9), pages 1417-1429, December.
  9. S.M. Shafaeddin, 2002. "The Impact Of China´S Accession To Wto On The Exports Of Developing Countries," UNCTAD Discussion Papers, United Nations Conference on Trade and Development 160, United Nations Conference on Trade and Development.
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  1. China a motivator for Latin America
    by Kevin P. Gallagher in East Asia Forum on 2010-10-28 11:00:33
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