China International Trade and New Challenges

English for Academic Purposes 2013

China: International trade and new challenges

Qiang Dai

Since the World Trade Organization (WTO) was founded in 1995, there has been a dramatic rise in the value of international trade. International trade relations among countries have developed and changed as well. China’s economy increased remarkably in the past decades following its accession to WTO. However, with the global economic growth slow down, new challenges occurred inevitably. This essay will discuss the current situation in international trade, what new challenges appeared, and what China can do to deal with it.

Influenced by the European debt crisis, Japanese earthquakes, Thailand’s flood and turmoil in Arab nations, global trade growth will continue to slow down. WTO Director-General Pascal Lamy (2013) described ‘world trade growth fell to 2.0 per cent in 2012 — down from 5.2 per cent in 2011 — and is expected to climb only slightly in 2013, to around 3.3 per cent’. (World Trade Organization, 2013) Following the world economic depression, the growth in international trade in next few years is difficult to exceed the growth in previous years, but it still can maintain steady growth.

In addition, the composition of international trade has been gradually optimized. According to Trebilcock et al. (2012), rates in service trade increased dramatically in many countries in past decade. Compared to the production of manufactured goods, the advantages in service trade are huge, which led to countries put more focus on the enhancement of service trade. (Trebilcock et al., 2012) In other words, the percentage of primary products and manufactured commodities declined; contrarily, the percentage of modern services grew rapidly. Also, Pascal Lamy described in the annual report of WTO (2013) ‘Services are traded internationally far more than we originally thought, comprising around 45 per cent of trade measured in value-added terms’ (World Trade...