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How Would a Slowdown in the People’s Republic of China Affect its Trading Partners?

dc.contributor.authorWillem Thorbecke
dc.description.abstractThe People’s Republic of China (PRC) has become an important importer for many countries. This paper investigates how turbulence in the PRC can spill over to trading partners through the trade channel. Exports from several East Asian and Southeast Asian countries to the PRC exceed 10% of their gross domestic products. To shed light on economies’ exposures to the PRC, this paper estimates a gravity model. The results indicate that Taipei,China and members of the Association of Southeast Asian Nations are exposed to the PRC because they produce goods for the PRC market and are exposed to advanced economies because they ship parts and components to the PRC for processing and reexport to the West. The Republic of Korea is more exposed to a slowdown in advanced economies that purchase processed exports from the PRC than to a slowdown in the PRC. Major commodity exporters such as Australia, Brazil, Indonesia, and Saudi Arabia and exporters of sophisticated consumption and capital goods such as Germany and Switzerland are exposed to a slowdown in the PRC domestic market. This paper also estimates import elasticities for the PRC. The results indicate that imports for processing into the PRC are closely linked to processed exports from the PRC to the rest of the world and that ordinary imports are closely linked to PRC gross domestic product. The renminbi exerts only a weak impact on imports, however. The paper concludes by recommending that firms and countries diversify their export base and their trading partners to reduce their exposures to the PRC and to advanced economies.
dc.publisherAsian Development Bank Institute
dc.titleHow Would a Slowdown in the People’s Republic of China Affect its Trading Partners?
dc.typeWorking Papers
dc.subject.expertResources evaluation
dc.subject.expertInput output analysis
dc.subject.expertImport volume
dc.subject.expertExport volume
dc.subject.expertExport Development
dc.subject.expertEconomic agreements
dc.subject.expertInternational market
dc.subject.expertImport policy
dc.subject.expertExport policy
dc.subject.adbProject Evaluation & Review Technique
dc.subject.adbOperations Evaluation
dc.subject.adbWorld Trade
dc.subject.adbTrade Volume
dc.subject.adbTrade Promotion
dc.subject.adbTrade Flows
dc.subject.adbTrade Development
dc.subject.adbPatterns Of Trade
dc.subject.naturalParticipatory monitoring and evaluation
dc.subject.naturalParticipative management
dc.subject.naturalForeign trade routes
dc.subject.naturalTrade routes
dc.subject.naturalForeign trade and employment
dc.title.seriesADBI Working Papers
dc.title.volumeno. 634
dc.contributor.imprintAsian Development Bank Institute
oar.adminregionEast Asia Region
oar.countryPeople's Republic of China
oar.authorThorbecke, Willem

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  • ADBI Working Papers
    The Asian Development Bank Institute (ADBI) Working Paper series is a continuation of the formerly named Discussion Paper series which began in January 2003. The numbering of the papers continued without interruption or change. ADBI was established in 1997 in Tokyo, Japan, to help build capacity, skills, and knowledge related to poverty reduction and other areas that support long-term growth and competitiveness in developing economies in Asia and the Pacific.

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