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Understanding China's demand for resource imports

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  • Roberts, Ivan
  • Rush, Anthony

Abstract

Is China's demand for resources driven predominantly by domestic factors or by global demand for its exports? The answer to this question is of interest given the highly resource-intensive nature of China's growth, and is important for many resource-exporting countries, such as Australia, Brazil, Canada and India. This paper provides evidence that China's (mainly manufacturing) exports have been a significant driver of its demand for resource commodities over recent decades. First, it employs input–output tables to demonstrate that, historically, manufacturing has been at least as important as construction as a driver of China's demand for resource-intensive metal products. Second, it shows that global trade in non-oil resource commodities can be described by the gravity model of trade. Using this model it is found that, controlling for other determinants of resource trade, exports (and the manufacturing sector more generally) are a sizeable and significant determinant of a country's resource imports, and that this has been true for China as well as for other countries.

Suggested Citation

  • Roberts, Ivan & Rush, Anthony, 2012. "Understanding China's demand for resource imports," China Economic Review, Elsevier, vol. 23(3), pages 566-579.
  • Handle: RePEc:eee:chieco:v:23:y:2012:i:3:p:566-579
    DOI: 10.1016/j.chieco.2011.05.004
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Yang, Shanping & Martinez-Zarzoso, Inmaculada, 2014. "A panel data analysis of trade creation and trade diversion effects: The case of ASEAN–China Free Trade Area," China Economic Review, Elsevier, vol. 29(C), pages 138-151.
    2. Charlier, Christophe & Guillou, Sarah, 2014. "Distortion effects of export quota policy: an analysis of the China-Raw Materials dispute," China Economic Review, Elsevier, vol. 31(C), pages 320-338.
    3. Sun, Changyou, 2017. "Competition of wood products with different fiber transformation and import sources," Forest Policy and Economics, Elsevier, vol. 74(C), pages 30-39.
    4. Sun, Changyou, 2014. "Recent growth in China's roundwood import and its global implications," Forest Policy and Economics, Elsevier, vol. 39(C), pages 43-53.
    5. Andersen, Thomas Barnebeck & Barslund, Mikkel & Hansen, Casper Worm & Harr, Thomas & Jensen, Peter Sandholt, 2014. "How much did China's WTO accession increase economic growth in resource-rich countries?," China Economic Review, Elsevier, vol. 30(C), pages 16-26.
    6. Adewuyi, Adeolu O., 2016. "Determinants of import demand for non-renewable energy (petroleum) products: Empirical evidence from Nigeria," Energy Policy, Elsevier, vol. 95(C), pages 73-93.
    7. Mayer, Andreas & Haas, Willi & Wiedenhofer, Dominik, 2017. "How Countries' Resource Use History Matters for Human Well-being – An Investigation of Global Patterns in Cumulative Material Flows from 1950 to 2010," Ecological Economics, Elsevier, vol. 134(C), pages 1-10.
    8. Li Xie & Wing Thye Woo & Zhichao Zhang & Zhuang Zhang, 2015. "A Multiple-Goal Investment Strategy for Sovereign Wealth Funds: An Application to China," Asian Economic Papers, MIT Press, vol. 14(1), pages 78-97, Winter/Sp.
    9. repec:eee:eneeco:v:69:y:2018:i:c:p:379-394 is not listed on IDEAS
    10. Hao Wei, 2016. "Measuring the Technological Structure of Chinese Imports," Review of Development Economics, Wiley Blackwell, vol. 20(1), pages 261-271, February.
    11. Allen, Creina & Day, Garth, 2014. "Depletion of non-renewable resources imported by China," China Economic Review, Elsevier, vol. 30(C), pages 235-243.
    12. repec:eee:ecanpo:v:57:y:2018:i:c:p:111-121 is not listed on IDEAS
    13. Zhang, Hai-Ying & Ji, Qiang & Fan, Ying, 2015. "What drives the formation of global oil trade patterns?," Energy Economics, Elsevier, vol. 49(C), pages 639-648.

    More about this item

    Keywords

    China; Trade; Investment; Resource commodities; Gravity model;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • Q31 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Demand and Supply; Prices
    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)

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