China–Africa Trade Patterns: causes and consequences

China's trade patterns with African countries have made Beijing the focal point of new anti-Chinese resistance narratives in Africa. Unlike the Maoist era, when China's trade policies served its leaders' political goals, now they aim to access markets as part of China's larger domestic development strategy. China's state-run firms can channel China–Africa trade through extra-market decisions that influence flows, yet, ultimately, Beijing's ability to direct trade with Africa is constrained by market forces. Despite suggestions that shared illiberalism drives China–Africa trade the author concludes that five interrelated causal factors overwhelmingly determine China–Africa trade: China's comparative advantage in labor-intensive and capital-intensive production; Africa's abundant natural resource endowments; China's rapid economic growth; China's emphasis on infrastructure building at home and in Africa; and the emergence of economies of scale in China's shipping and light manufacturing sectors.     

ASEAN–China Trade Flows: moving forward with ACFTA

There are claims that China's influence on ASEAN is direct in that she has encouraged more exports to flow into her huge markets and changed trade flows amongst member countries. Demand and supply are deemed to have therefore become more China-centred. This paper looks at the plausibility of China as a ‘factor’ that influences bilateral intra-ASEAN trade flows through demand (exporting country) and supply (partner country). The key finding of the study is that China's trade association with the region increases intra-ASEAN exports. China is therefore the most practical choice for the ASEAN+1 FTA to initiate deeper trade integration within the region. China, as the ‘core’ country of the ACFTA can provide complementarities in the export performance of ASEAN.     

China and the Asian Economies: mutual acceptance,economic interaction and interactive dynamics

The objective of this article is to explore the economic relationship between China and the surrounding dynamic Asian economies. It delves into China's influence over the Asian economies and whether this relationship has evolved in a market- and institution-led symbiotic manner. The three principal channels of regional integration analyzed in this article are trade, FDI and vertically integrated production networks. Another issue that this article explores is the so-called China ‘threat’ or ‘fear’ in Asia. The China threat implied that China was crowding out exports from the other Asian economies in the world market place. Also, as China became the most attractive FDI destination among developing countries, it was understood that China was receiving FDI at the expense of the Asian economies. These concerns were examined by several empirical studies and the inference was that they were exaggerated. The article concludes that China methodically expanded and deepened its economic ties with its regional neighbors. At the present juncture, China's integration with the surrounding Asian nations is deep. Both China and its dynamic Asian neighbors have benefited from this synergy.     

Is There Hope for Firms Facing the Technology Gap? A case of China's mobile industry

We have examined the way in which local firms in China's handset industry, confronted with a technology gap, have achieved growth, using the concept of boundaries of the firm. Chinese local firms have lacked technology, and have therefore turned to outside firms for development, design, and manufacturing in some cases. On the other hand, they themselves have focused on sales and marketing, using their advantage of familiarity with the home market. Consequently, by establishing a growth condition in which their selection of boundaries counterbalances the technology gap, they have been able to expand their market shares in comparison with foreign firms.     

Technology and economic development: the case of Taiwan

In this paper it is argued that Taiwan succeeded in developing by deviating from the currently popular ‘Washington Consensus’ strategy in specific ways. In particular, it developed investment strategies that have now reached a crucial ‘Schumpeterian’ phase. This has important implications for high and information technology sectors. Following Schumpeter we assume that innovation in specific firms can have economy‐wide effects. Models based on this idea can be shown to have multiple equilibria. The idea of a positive feedback loop innovation system or POLIS is formalized by picking an appropriate sequence of equilibria over time. It is shown that POLIS has empirical relevance by applying the formal model to an actual economy. Recent financial crisis in many Asian countries, most notably South Korea, seems to have reversed the conventional wisdom regarding the East Asian ‘miracle’. This paper applies the concept of a POLIS to show that neither the current view that the miracle was a mirage nor the earlier contrarian view that the growth was a result of factor accumulation only is correct. Ultimately technological transformation—in particular the creation of a positive feedback loop innovation system is what makes the difference between sustained growth and gradual or sudden decline. Although various problems remain in both the real and the financial sectors, the successes of Taiwan in building the preconditions for an innovation system are worth examining. Upon careful examination of Taiwan's system of innovation within the above Schumpeterian model it is found that of all the ‘miracle’ economies Taiwan has the best chance of building a POLIS in the near future. Because of Taiwan's strength in building a POLIS, the PRC can also benefit from continuing contact with Taiwan through trade and FDI from Taiwan.     

A New Chinese Discourse of India

Conventional wisdom has held that China is a success and India is a failure, that India's democracy leads to its poverty and religious intolerance, and China's economic reform without political opening was the only correct path to development and stability. The success of the Indian domestic software industry awed many Chinese and contributed to recent online discussion of India among Chinese scholars. This article sheds light on the changing views of India in China through surveying online articles posted on two major Chinese websites. The new discourse focuses on the historical, cultural, and institutional roots, particularly government policies that have led to the current situation in India. The new Chinese discourse also reflects evaluations of China's own economic policies in the past few decades.     

Loss‐making and the financial performance of China's industrial enterprises: Data from the new accounting and statistical system

Massive losses and falling profitability in China's state‐owned industries have attracted widespread attention in recent years. This paper, based on data from China's new industrial accounting and statistical system, examines the performance of these industries from two perspectives. The first is the comparative performance of state enterprises under central and regional control. The second is the way in which the enterprises have disposed of pre‐tax profits. The findings suggest that the increasingly competitive environment in which state enterprises have to operate and the transitional nature of their institutional arrangements are major factors which have contributed to the problems which they face. It is further argued that the existence of such problems is likely to be the source of considerable pressure on the future development of China's capital markets.     

As a Hundred Television Formats Bloom,a Thousand Television Stations Contend

This paper looks at the growing trend towards television format adaptation as an industry development strategy in China. As China's television industry professionals imagine a commercial future, this vision is tempered by the reality of a deficit of quality content. Program schedules exhibit limited variety and are dominated by cheap variety show formats, royal court television dramas, game shows, and news. In search of new ways to stimulate audiences, producers have looked outside China to formats successful in Taiwan, SAR Hong Kong, Japan, Europe and the US. The localization of foreign programs represents a more useful experiment for China's domestic industry than the importation of finished programs. Unlike finished programs the format can be 'filled' with culturally specific content, and where licensed co-productions ensue there is the potential for added value in terms of technology transfer. I argue, however, that the strategy of format adaptation is a short-term solution to program development that is unlikely to stimulate a creative media-based economy.     

External Contradictions of the Chinese Development Model: export-led growth and the dangers of global economic contraction

China's development model faces an external constraint that could cause an economic hard landing. China has become a global manufacturing powerhouse, and its size now renders its export-led growth strategy unsustainable. China relies on the US market, but the scale of its exports is contributing to the massive US trade deficit, creating financial fragility and undermining the US manufacturing sector. These developments could stall the US economy's expansion, in turn triggering a global recession that will embrace China. This is the external constraint. These considerations suggest that China should transition from export-led growth to domestic demand-led growth. This requires growing the economy's demand side as well as its supply-side. To avoid stalling the US economic expansion, which is critical to China's growth, China should significantly revalue its currency as part of a generalized East Asian upward currency revaluation. Longer term, China should raise wages and improve income distribution. Under export-led growth, higher wages undermine employment. Under domestic demand-led growth, they support it. The challenge is to raise wages in an efficient decentralized manner. History shows that this requires independent democratic trade unions. However, such unions are currently unacceptable to the Chinese political leadership. Creating a domestic demand-led growth regime therefore requires solving this political roadblock.     

Multilateral versus Bilateral and Regional Trade Liberalization: explaining China's pursuit of free trade agreements (FTAs)

In recent years, at the same time it has pursued multilateral trade negotiations via membership in the World Trade Organization (WTO), China has embraced a regional approach to trade liberalization by negotiating a number of bilateral or regional free trade agreements (FTAs) with its trading partners. This paper examines China's increasingly active FTA diplomacy and seeks to explain China's motives for pursuing expanded FTAs. Specifically, this paper argues that while China's FTA activism reflects considerations about enhancing China's influence in the Asia–Pacific region, capturing the economic gains of FTA participation, and minimizing the trade and investment diversion resulting from the competitive dynamics of regional trade liberalization, the move toward expanded FTAs is also consistent with the desire to create alternative bargaining forums over trade issues that could help to stabilize expectations as well as the need to use FTAs to control the pace of trade liberalization so as to accommodate protectionist pressure emanating from domestic interest groups. In particular, this paper highlights the impact of domestic politics on China's FTA negotiations through a detailed discussion of how pressure from protectionist seeking interests influences the scope and depth of China's FTAs.     

A Crisis is Looming: China's energy challenge in the eyes of university students

This paper uses a survey at six universities in China to analyze university students' views on China's energy problems. It finds that gender, the nature and location of a student's original community, and their level of education affects students' views about China's energy problems, as well as the types of solutions that are deemed to be most appropriate to manage this looming crisis. University students are quite concerned about China's energy situation. For them, it is already a crisis. They fear China will be controlled due to resource dependency, see the US as China's primary energy competitor, all the while advocating a more hawkish attitude towards Japan in the East China Sea. But, they look foremost to domestic solutions to this crisis, such as enhanced conservation, more efficient use of energy, new technologies, enhancing China's strategic reserve, and increased government taxation, particularly of large enterprises. When they look abroad, they support diversifying energy sources, increasing energy cooperation, particularly with Russia and Central Asia (but not with Japan), and some increase of the navy's role in enhancing sea lane and energy security.     

Leverage,Technical Efficiency and Profitability: an application of DEA to foreign-invested toy manufacturing firms in China

Based on a representative sample of the 238 largest foreign-invested toy manufacturing firms in southern China by output value, we adopted a two-stage approach to examine the role of leverage on firm performance as measured by technical efficiency, and the effect of efficiency on profitability. In the first stage, we use data envelopment analysis (DEA) to estimate the technical efficiency of the sample firms. In the second stage, we conduct a regression analysis to study the effects of leverage on efficiency and of efficiency on profitability. Our empirical results support the view that leverage has a positive effect on firm technical efficiency and that there is a positive relationship between technical efficiency and profitability.     

Gaming,Nationalism, and Ideological Work in Contemporary China: online games based on the War of Resistance against Japan

The development of China's online game industry provides an example of the interaction of new technologies and politics in the commercialization and globalization of China's cultural economy. The analysis of online games about China's Resistance War against Japan (1937–1945) highlights the interplay of the state's political agenda, business interests, and nationalistic sentiments as online games are planned, designed, and consumed in contemporary China. It reveals that the Party-state has candidly integrated online game technology into its expanding propaganda domain and utilized it for propagating official ideology and sustaining economic growth.     

Implications of WTO Membership for China's State-owned Banks and the Management of Public Finances: Issues and strategies

WTO membership will dramatically change the environment within which China's financial institutions operate. It increases the urgency of many reforms, including the re-capitalization of state-owned commercial banks and the establishment of a healthy credit culture. The severe under-capitalization of state banks and many state enterprises is part of a growing domestic debt problem that cannot be solved through normal fiscal policy adjustments. It will require the sale or securitization of state assets on a much larger scale than has been undertaken so far. The approach that was taken by the government's four Asset Management Companies to non-performing loan clean-up in 1999 and 2000 was flawed and should not be repeated. State banks should play a larger role in absorbing their own accumulated losses. China should leverage its external financial strength for domestic financial clean up. If the balance of payments remains strong, a mild appreciation of the nominal exchange rate--when the risk of deflation has passed--may serve China's interest. A large and growing proportion of state assets is held in the form of non-tradable shares in partially privatized state companies. To protect state solvency, many of these shares will have to be made tradable and sold in the next 5-10 years. A further strengthening of the fiscal system, along with rapid development of domestic capital markets is essential. Breaking up some or all of the four large state-owned commercial banks into smaller units may facilitate their restructuring and eventual privatization.     

Nationalism and Democratization in Contemporary China

The crippled economic and political reform in China has come with two schools of thought: the new-left and nationalism. The new-left focuses on domestic issues, while nationalism tackles more international relationships. This paper explores the effects of radical nationalism on China's democratization process. It argues that if nationalism takes the dominant position in China's political process, Chinese reform will go astray.     

Industrial productivity in China's state‐owned enterprises: The textile industry in Guangzhou, 1979–1993

This article examines productivity growth and effects of incentive payments on it in China's state‐owned enterprises. Data spanning the 1979–1993 period were taken from 20 large‐and medium‐scale state‐owned textile enterprises in Guangzhou. The empirical study finds that the sample enterprises experienced an average increase in total factor productivity growth by 1.8% annually. The analysis of the effects of incentive payments on productivity shows that total factor productivity growth is positively tied to increases in retained profits but it bears no significant relationship with increases in bonuses. Besides, the study suggests a positive time trend of total factor productivity growth by 0.8% per year.     

The effects of China's rural industry on agricultural environment

Rural industry is the fastest growing sector in China's economy and made up 27.52% of the GNP in 1990. The development of rural industry not only enhances the peasants’ living standard, but also demonstrates the advantages and potential of a new ownership system. Along with the development of the rural industry, however, some serious environmental problems have emerged in the agriculture. Traditional agriculture and farmers are rapidly disappearing in the developed rural industrial areas. Due to some unique characteristics of rural industry, such as its wide distribution, small size and frequent production change, a set of new environmental problems have arisen. These problems threaten a vast area of China's best cropping land. Solving those problems is beyond the capacity of current agricultural and industrial policies, because these problems are directly related to China's political system. The author proposes a set of strategies and policies that, under the current political constraints, may mitigate the negative effects of rural industry on the agricultural environment.     

How Do Americans Evaluate China's International Responsibility? An Empirical Assessment

China in recent years has been asked by other major powers to take a greater share in international responsibility in response to the rise in China's national capability. Negative perceptions about how China is dodging its international responsibility exist not only among policy makers around the world, but have spread to worldwide mass publics, especially across the American people. In this article, we apply the dataset from the ‘Americans’ Attitudes toward China Survey' (AACS) to investigate what the American public think of China's international responsibility and which factors explain the varying evaluations from different theoretical perspectives. The results indicate that Americans' negative evaluations of China's international responsibility are associated with poor ratings regarding China's fulfillment of its domestic obligations and apprehension regarding China's potential threat, but has little to do with China's international behavior. To reduce these negative evaluations, China needs to improve its human rights conditions, give people more political rights, and convince the American public of the benevolence of its ascending power. In addition, persistent efforts toward soft-power construction are also very important since Americans who are interested in Chinese culture or knowledge tend not to think that China is dodging its international responsibility.     

Total Factor Productivity Growth and its Spatial Disparity across China's Township and Village Enterprises

What lies behind China's recent economic prosperity is the unexpected success and development of her township and village enterprises (TVEs). The proportion of China's total industrial output produced by the TVEs increased from 9 to 42% between 1978 and 1994. The incredible development of the TVEs, along with the declining in importance of the SOEs in recent years, undoubtedly suggests that the TVEs are the engine of growth of the Chinese economy, and their continuous success will have a tremendous impact on the economic development of China in and beyond the twenty-first century. What remains questionable, however, is whether or not this rapid development of the TVEs is at the same time exacerbating China's spatial disparity by encouraging inequality in productivity and production efficiency of these enterprises across different provinces. This study aims to answer this question by examining the changes in total factor productivity (TFP) of TVEs located in different provinces between 1988 and 1993 with particular reference to the corresponding spatial disparities of these changes. The Malmquist output based productivity index, which allows for the decomposition of productivity growth into changes in technical efficiency over time and shifts in technology over time, is the technique adopted here.     

The Ascendency of State-owned Enterprises in China: development,controversy and problems

The state sector still plays an important role in China's economy. One of the key development phenomena characterizing the Chinese economy is the rapid ascendency of state-owned enterprises (SOEs) and the resurgence of the state. The strength of China's SOEs is projected in the centrally administrated state-owned enterprises (CSOEs). They are the backbone of the national economy, spearheading national economic development and Beijing's ‘going-out’ strategy. The CSOEs have expanded their reach and increased their power, domestically and globally. In seeking to boost local GDP growth, the eastern provinces in China have joined the western provinces in a fierce contest to attract investment from SOEs. Nevertheless, the rapid ascendency of the SOEs has brought many negative consequences for China's economic, social and political development by causing conflict with the market-oriented development direction of Chinese economic reform and hindering fair competition between state-owned and non-state-owned enterprises.