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China's pattern of trade and growth after WTO accession: Lessons for other developing countries

  • Longyue Zhao
  • Yan Wang
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Purpose – World Trade Organization (WTO) accession marked a new beginning for China's economic, legal and institutional reforms and rapid integration with the rest of the world. The purpose of this paper is to review China's post-WTO transition experience, synthesize and update studies on China's pattern of trade and structural transformation, and provide both positive and negative lessons for other developing countries. Design/methodology/approach – The paper has broadly reviewed the latest policy changes after China's WTO accession, and literatures on China's trade and economic development issues in order to understand the Chinese success and its speciality, and draw some useful lessons for both China's decision-makers and other developing countries. Findings – There are two main findings: first, market liberalization alone is not sufficient, and economic system reform and the liberalization are closely related and complement and promote each other. Second, experimentations via special economic zones (SEZs) and opening to foreign direct investment (FDI), which facilitated and supported cluster development and learning-by-doing, are needed for industrial upgrading and export competitiveness. Originality/value – The paper demonstrates the wisdom of China's simultaneous pursuit of domestic economic system reform, and opening to the international market. However, China has also paid a high social and environmental cost for its rapid growth. It is important for developing countries to have an exclusive, balanced and sustainable strategy in the future development.

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Article provided by Emerald Group Publishing in its journal Journal of Chinese Economic and Foreign Trade Studies.

Volume (Year): 2 (2009)
Issue (Month): 3 (October)
Pages: 178-210

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Handle: RePEc:eme:ceftpp:v:2:y:2009:i:2:p:178-210
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