China’s trade competitiveness in the area of agricultural products after the implementation of the World Trade Organization commitments

Abstract

The paper provides evidence on the implementation of China’s trade commitments into its institutional and legal environment, which influenced its agricultural trade. The contribution to the trade balance index and the revealed comparative advantage index are used for the identification of changes in China’s export competitiveness in agricultural products between 2001 and 2015. The World Trade Organization (WTO) trade liberalisation, followed by changes in the structure of economy, contributed to China building a trade deficit in the area of the agricultural products and losing competitiveness in some products. China gradually liberalised its agricultural trade in compliance with the WTO commitments. However, relatively high protection or state regulation of the domestic market has remained in products that China exports with a revealed comparative disadvantage. The existence of the state trading can also have a negative impact on the results of China’s revealed comparative advantage in its exports of agricultural products.