Dissertation > Economic > Trade and Economic > States foreign trade > China's foreign trade > Import and Export Trade Overview > Special trade

The Research on Integration Upgrade of Chinese Processing Trade

Author XuRong
Tutor ChengJin
School Nanjing University of Finance and Economics
Course International Trade
Keywords Markets Transition Enterprises Capabilities Transition Transformation of Roles
CLC F752.68
Type Master's thesis
Year 2011
Downloads 303
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Along with the acceleration of global economic integration and deepening of the division of labor, Chinese processing trade is facing the critical moment of role’s conversion to higher value-added part of the value chain functions to upgrade, the U.S. subprime mortgage crisis triggered by the financial crisis has accelerated this process. After 2007,the total import and export of Chinese major imports and exports region overall decline, the first quarter of 2009, exports decreased by 19.7% over the same period. Export of key commodities reduces nearly 90%, down 20.27%. The reduce of U.S. import demand, and RMB appreciation in post-crisis era further compressed Chinese processing trade margins ,who’s main export market is Europe and America. It’s urgent time to change the idea for Chinese processing trade to seek survival and development. From the long term angle, it’s important to China for improving added value of Chinese foreign trade, promoting development of related domestic industries, and realizing domestic trade pattern optimization.In this context, based on the theory of global value chain and the theory of dynamic capabilities, analysis the overview of Chinese processing trade development and the base of transformation and upgrade from the size, the proportion of net export trade, processing trade contributed to economic growth rate, the pulling rate, foreign trade competitiveness and Chinese processing trade in value chain governance. And the same time, this paper establish dynamic capability in value distribution model and the different value chain actors Game Model, to analysis the impart of enterprise dynamic capability to transformation and upgrade, as well as the possibility developed enterprise capabilities in the domestic market, where found that the wish by leader enterprise is the important factors to transformation, and the formation of dynamic capabilities is a key feature upgrade of processing trade power. Therefore, transformation and upgrading of processing trade in China must first overcome the constraints of low-level dynamic capabilities, organizational culture and integration capabilities. The core vendor of developed country has higher level will to transfer higher lever knowledge to enterprises in domestic market. So the development of capabilities can be put into the domestic market which has the different trade pattern.Using the domestic market to cultivate enterprise capability is just the first step for the transformation and upgrade of Chinese processing trade, processing trade enterprise still need touse acquired enterprise capability as exploring international market for a preparation and strategy, Complete the transformation from low value-added part in the original value chain to the higher value-added part in the new value chain. This paper use two example: the compare of Japanese auto industry and domestic manufacturing enterprises Glanz, and Zhejiang textile industry. By comparing the different path to transformation and upgrade and the integration of docking mode between domestic value chains and global value chain, and find the way to overcome markets transformation, analysis the form of re-integrate the domestic value, joint senior elements of resources and dynamic capabilities, develop and control the surrounding areas and less developed markets overseas, the formation of different forms of value chain, which continue to proposed a upgrade path by transform the enterprises capabilities and roles division based on markets transition.

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