Model analysis:

As shown in the figure, the output of the enterprise is divided into two parts, which are sold in domestic and foreign markets respectively. Because the demand price elasticity of manufacturers' products in domestic and international markets is different, the shapes of domestic and international demand curves faced by manufacturers are also different. Generally speaking, the shape of foreign demand curve faced by manufacturers is relatively flat, while the shape of domestic demand curve faced by manufacturers is relatively steep. According to the characteristics of domestic and foreign markets, manufacturers sell at different prices in order to obtain the maximum profit.

The conditions for the manufacturer to decide its price and sales distribution plan are: MRH=MC=MRF.

Among them, MRH is the manufacturer's marginal revenue in the domestic market, MRF is the manufacturer's marginal revenue in the foreign market, and MC is the manufacturer's marginal cost.

Nature: This dumping behavior is to maximize profits, and it is a profit-driven enterprise behavior. As long as it is not restricted, it will continue.

(2) Predatory dumping: In order to crowd out competitors in the market, exporters temporarily sell goods to foreign markets at lower prices. Once the goal is achieved and the monopoly position is obtained, the enterprise will raise the price again to obtain monopoly excess profits.

Nature: this is an act aimed at defeating opponents and pursuing monopoly position, and it is an act of unfair trade.

6, mutual dumping

Refers to the two-way trade of the same product caused by dumping. That is, Party A and Party B sell the same product to each other at a price lower than that in China.

Suppose there is a monopoly manufacturer at home and abroad, who produces the same product, the marginal cost of the two manufacturers is the same, and the transportation cost between the two markets is the same. If they set the same price, there will be no transaction, but if dumping is used, there will be a transaction.

Both manufacturers will restrict sales in the domestic market to control the price of their products in the domestic market. However, if a manufacturer can sell in the other market at a price lower than its domestic price, the negative impact of price reduction will be passed on to the opponent instead of being borne by itself, which will also increase its profits, so each manufacturer has the motivation to occupy the other market. And sell products at a price higher than marginal cost but lower than domestic price. However, if both manufacturers do this, even assuming that the initial prices of products in the two markets are the same, and both of them pay for transportation, international trade will appear.

7. Anti-dumping duties

(1) Anti-dumping duty: refers to the import surcharge levied by the government of the importing country on the products of foreign exporters when it is confirmed that the goods sold to the domestic market are dumped.

(2) Impact:

① It can reduce the domestic demand for low-priced imports;

(2) Raise the import price to the level of the domestic market price of the importing country, so as to protect the domestic producers of similar commodities.

Case 8-3: Egyptian anti-dumping measures against China porcelain.

The Egyptian Ministry of Foreign Trade has made a decision this week to take anti-dumping measures against ceramic tableware imported from China, and began to impose tariffs as high as 305%.

Reason: China porcelain flooded into Egyptian market, which has already impacted similar products in China, greatly reduced the output of local porcelain processing plants and caused a serious inventory backlog. It is understood that Egypt imported 20,000 tons of porcelain from China last year, accounting for 96% of Egypt's annual porcelain imports.

Published in Yangzi Evening News on February 26th, 2003.

Intransitive verbs and other non-tariff barriers

1, voluntary export restraints: refers to the voluntary restriction of the export quantity or export amount of a commodity in a certain period of time at the request or pressure of the importing country.

Voluntary export restraints implemented export restrictions under the pressure of importing countries, similar to quotas. The number of voluntary export restraints is determined through negotiations between importing and exporting countries.

Function: It can make it difficult for exporters' superior products to enter the domestic market.

2. Discriminatory public procurement: this is a non-tariff barrier measure, and a government gives domestic suppliers priority in obtaining government procurement orders according to relevant national legal systems.

Government procurement gives priority to domestic goods, which forms discrimination against foreign sellers.

3. State monopoly of foreign trade: "State-owned trade"

State-owned enterprises or public enterprises enjoy the privilege of directly engaging in international trade, thus forming a state monopoly on foreign trade.

Disadvantages: artificially distorting the allocation of resources, resulting in excessive protection and low efficiency.

4, technical standards and health and quarantine standards

(1) technical standards: refers to the relevant provisions made by the importing country to ensure that the import quality of various commodities meets the general technical requirements.

In order to restrict the import of certain commodities, some countries often stipulate some technical standards that are difficult for foreign countries to master, so as to prevent foreign businessmen from entering their own markets.

(2) Health and quarantine standards: refers to the necessary health and quarantine for imported animals and plants and their products, food and cosmetics. To prevent diseases or pests from being introduced into the country.

It is worth noting that some countries often shut out foreign products on the pretext that imported goods do not meet their own health standards.

Case 8-4: "Bird subsidy" was declared illegal by WTO.

The Byrd Amendment passed by the U.S. Congress in 2000 requires the U.S. government to directly subsidize the punitive taxes collected in anti-dumping and countervailing cases to American companies whose interests have been damaged, instead of turning them over to the U.S. Treasury.

The United States implemented double protection for domestic companies through the Byrd Amendment, which actually encouraged domestic companies to initiate anti-dumping and countervailing lawsuits, and was strongly criticized by trading partners. It is reported that in 200 1 and 2002, the United States subsidized about 56 1 billion dollars to its domestic companies in this way.

This practice of the United States has been opposed by major trading partners including the European Union and Japan. To this end, the European Union, Japan, Canada, Brazil, India, South Korea, Mexico and Chile recently applied to the WTO to allow additional tariffs equivalent to the amount of US government subsidies on some products from the United States.

On June 5438+ 10, 2003, the WTO finally ruled that the amendment violated the global trade rules and demanded that the United States abolish it before February 27, 2003. But the United States has not implemented the WTO ruling.

On August 3 1 2004, the World Trade Organization authorized eight members, including the European Union, to impose trade sanctions on the United States as a punishment for the United States' delay in abolishing the Byrd Amendment, which was declared illegal by the WTO.

Case 8-5: Appearance becomes a trade barrier. China Stationery was sued by American enterprises.

Similar looks lead to problems-recently, Sanford Company, a famous American stationery company, sued global 12 companies, claiming that their marker pens exported to the United States violated their "trademarks and trade dress" and have been formally filed by ITC (United States International Trade Commission). Four enterprises from China, including Ningbo Beifa Group, are in the dock.

It is reported that "trade dress" is one of the "337 clauses" of trade protectionism unique to the United States. In addition to intellectual property rights such as copyrights, trademarks and patents, the United States also has the right to question the appearance similarity of imported products. This time, Sanford Company accused China Beifa marker of infringing its "business appearance" by virtue of this clause.

Although the annual sales of the products involved in Befa Group in the United States is only 500,000 US dollars, it is still prepared to spend10.5 million US dollars to respond to the lawsuit. From an economic point of view, it is definitely not cost-effective, but Zhou Jie, Befa's legal adviser, told reporters that making such a choice is based on three considerations: first, giving up means giving up automatically and giving up the right to compete for the market; Second, we can defend the interests of the whole industry by responding to the lawsuit. Because in case of losing the case, and the final ruling of ITC gives a general description of the sanctioned marker pen, it will be implicated in the export of other stationery enterprises in China-this is not impossible. The third consideration is that even if the so-called "trade dress" infringement can be established, it is difficult for the United States to clearly define the scope of the "minefield" to avoid China enterprises being unclear.

For this accusation, several enterprises involved in China were outraged and thought that the US was simply making things difficult. In fact, there is no clear legal definition of the concept of "trade dress" in the United States, only a general provision: "Consumers can immediately distinguish a product from a famous brand according to its appearance, which is infringement." The final ruling is also finalized by the judge, which is quite like the "overlord clause". It is understood that pen-making enterprises in China are very careful before exporting, and they all go to the US Patent Office and Trademark Library for inquiries before entering the US market. However, they are still careful step by step.

More and more enterprises in the United States are using this unique law to frequently set up obstacles to China's goods, the real purpose of which is not to protect intellectual property rights, but to protect their own market share. It is understood that the pen involved in Befa has only been in Wal-Mart for 2 months, and its sales volume is 7 times that of Sanford's "similar pen"! Befa believes that consumers will never confuse the appearance, but because the quality of the two pens is similar, but the price difference is 20%, the China pen with good quality and low price is finally chosen. Interestingly, among other 1 1 companies accused by Sanford, there are Korean companies and some American importers, but Wal-Mart is also an importer of Befa, but Sanford deliberately avoids direct competition with the giant Wal-Mart. According to Yu Danhua, deputy director of Ningbo Foreign Economic and Trade Commission, Sanford guessed that Chinese enterprises were thinking: maliciously harassing Chinese enterprises. Considering the high litigation cost and low sales volume in the United States, most Chinese enterprises will give up fighting, so their market share will be surrendered.

But this time, Sanford's abacus may be wrong. Zhou Jie told reporters that Befa was ready to take a few steps. The first step is to question the so-called "trade dress" infringement. According to legal procedures, a public opinion survey is needed-will Befa's products be mistaken for "brand-name goods" at a glance? The first step is no good, and then argue that there is a significant difference between the two strokes. Because Befa has clearly marked its own trademark, there are obvious differences in appearance. "We don't rule out the arbitrariness and tendency of the ruling, which depends on the personal quality of the judge, but we still have to do our best to fight for rights!" Zhou Jie said.

Chapter IX Economic Integration and Customs Union

I. Forms of economic integration

(1) Economic integration: refers to an economic cooperation organization established by two or more countries or economies through reaching some agreement.

(2) Free trade zone: refers to an economic integration organization formed by two or more countries or administratively independent economies through reaching an agreement to cancel import tariffs and other measures with the same effect as tariffs.

Case 9- 1: WTO and Free Trade Area

It has been three years since China joined the WTO. Three years later, China changed its cautious attitude towards the slow pace and narrow vision of participating in the FTZ. Looking around, in order to obtain the benefits of free trade, trade negotiations are everywhere in the world. When every round of WTO negotiations is entering a protracted tug-of-war, bilateral free trade agreements have gradually become a trend.

In 2005, the construction of China-ASEAN Free Trade Area will finally enter a new era. Did China find a big market? In fact, in view of the narrow ASEAN market, China enterprises may not be able to sell more products, but the breakthrough of China-ASEAN Free Trade Area shows that China is entering a free trade area (FTA). Looking at the WTO from another angle, China will gain more.

Experts have always believed that the ASEAN market is too narrow. Among more than a dozen ASEAN member countries, there are Singapore, a newly industrialized country, and the least developed countries in the world such as Vietnam, Myanmar, Laos and Cambodia. The regional population is less than 600 million, and the total GDP is not high. Moreover, most developed ASEAN countries pursue export-oriented strategy, and their export products, like China, are mainly labor-intensive products.

In terms of trade volume, the United States and Japan are the main trading partners of ASEAN, and China may sell more middle and low-end consumer goods and mechanical and electrical products in the future. Compared with ASEAN products, China will have obvious comparative advantages in textiles, food, grain, building materials and other products, but more benefits will be brought by ASEAN countries.

If we only look at FTA from the perspective of product export, the benefits brought by China-ASEAN Free Trade Area to China may not be so great. However, if we look at free trade from another angle, China may gain a lot. Another angle I am talking about here is the benefits of "unilateral free trade" proposed by some economists. In other words, even if the other side adopts the attitude of trade barriers, it is beneficial to unilaterally open free trade.

The simplest thing is that cheaper and better agricultural products from ASEAN have at least benefited China consumers. In addition, a large amount of energy and raw materials imported from ASEAN countries also meet the rapid economic demand of China. In recent years, with the rapid economic development, China's imports of raw materials from ASEAN are also increasing, and there has been a big deficit.

At present, China is still negotiating free trade zones with some countries in Australia, Chile, the Middle East and Africa. By comparison, we can know that these countries are not simple for China. First of all, these countries are distributed on all continents, which can almost be regarded as the front stop of China's FTA strategy in various regions of the world; Secondly, these countries are likely to provide abundant energy and raw material resources for China's sustained and rapid economic development, such as Australian iron ore, Chilean copper mine and oil resources in Middle East and African countries.

Even if the establishment of each free trade zone brings a small amount of direct product exports to China, the establishment of more free trade zones may achieve the effect of many a mickle makes a mickle, thus partially changing the situation that China's product exports are too dependent on the US and EU markets.

From a more complicated point of view, even if the establishment of a free trade zone cannot benefit from economic interests, we may gain advantages from a non-economic perspective, which will affect the subsequent economic interests. The recognition of China's market economy status by ASEAN countries this year is an obvious strategic victory and one of the biggest gains of China's "Early Harvest Plan". At present, a prerequisite for Australia-China FTA negotiations is "whether to recognize China's market economy status".

In the bilateral FTA negotiations, China can express its views more actively, let the world know more about China and participate in formulating more reasonable rules of the game. The more bilateral free trade agreements are concluded, the greater will be China's voice in the new round of multilateral trade negotiations.

1, function:

(1) The barriers to commodity trade among participants in this economic organization have been eliminated, and manufacturers in member economies can freely import and export commodities, thus realizing the free trade of commodities, but it strictly limits this trade treatment to participating countries or member countries.

(2) There is no external tariff between member economies. Free trade among member economies does not prevent member economies from adopting other trade policies towards non-FTA members.

(3) Adopt the principle of origin: only products produced by member economies can enjoy free trade or be exempted from import duties.

2. Products of origin: refers to products produced by member countries of free trade zones, accounting for more than 50% of the value of finished products. (sometimes stipulated as 60%)

(3) Customs Union: refers to import tariffs or other trade policies and measures uniformly implemented by all members to non-member countries on the basis of a free trade zone.

Features:

The difference between 1. and free trade zone: while canceling import tariffs, the same external tariffs are set, and the product flow between member economies does not need to be accompanied by a certificate of origin.

2. In fact, the customs union is that each member transfers the right to formulate tariffs to the economic integration organization, so it is more binding on the member economies than the free trade area.

3. Economies within the customs union need to take more covert measures, such as non-tariff barriers, to protect some of their own industries.

(4) * * * One market: It means that all member countries have not only realized free trade and established external tariffs, but also realized the free flow of services, capital and labor.

Features:

1. The free flow of goods, services and production factors has been realized among member countries at the same time.

2. Countries should implement unified technical standards and a unified indirect tax system, coordinate the tax rate of the same product among member countries, and coordinate the laws and regulations on financial market management to realize mutual recognition of academic qualifications among member countries.

(5) Economic Union: It means that not only all member countries remove trade barriers and unify their foreign trade policies, but also allow the free flow of production factors, and on the basis of coordination, all member countries adopt unified economic policies.

Features:

1. On the basis of forming a common market, member countries should further coordinate fiscal policy, monetary policy and exchange rate policy.

Economic and monetary union: refers to the economic and monetary union when the exchange rates of various countries are coordinated to a certain extent, thus establishing the currency used by member countries or a unified currency.

2. Each member state has also given up the right of all macroeconomic policies to interfere in its domestic economic operation and the right of using exchange rate policies to interfere in its external economic balance.

3. Form a free market economy within the economic union.

(e) Complete economic integration: refers to the further coordination of economic, political and legal systems among member countries, or even a unified form of economic integration, on the basis of achieving the goal of economic union.

Features: Similar to a country's economic integration organization.

There are two forms of complete economic integration:

1. Confederate system: the rights of each member state are greater than those of supranational economic integration organizations.

2. Federalism: the rights of supranational economic integration organizations are greater than those of member States.

The above five economic integration organizations are international integration organizations at different levels. According to the degree of transferring national sovereignty, the integration organizations are also arranged from low level to high level, but it is not necessary for the low-level economic integration organizations to upgrade to high level.

Second, the theory of customs union.

(A) Analysis of the static effect of customs union

1. Trade creation: refers to the expansion of trade scale brought about by mutual elimination of tariff and non-tariff barriers among member countries.

2. Trade diversion: After the establishment of the customs union, the mutual trade between member countries replaced the trade between member countries and non-member countries, leading to the diversion of trade direction.

As shown in the picture: There are three countries in the world, A, B and C, all of which produce the same product. But the production costs of the three countries are different, PA > Pb > PC, SA represents the supply curve of country A, and DA represents the demand curve of country A. ..

Before forming a customs union, it is assumed that country A is a small country, and country A imposes the same tariff T on goods from country B and country C.. After the tariff is levied, if the same product of country B and country C is sold in country A, the price will be levied separately. Because the price of products in country B is higher than that in country C, country A will only import products from country C, but not from country B. At this time, the domestic price in country A is PC+t, the domestic production is OQ 1, the domestic consumption is OQ2, and the import from country C is Q 1Q2.

Suppose that country A and country B form a customs union. After the two countries establish a customs union, the external tariff is still T. At this time, country A no longer imposes tariffs on imported goods from country B, but still imposes tariffs on imported goods from country C. At this time, the price of products from country B in country A is PB, which is lower than PC+t, so country B replaces country C to become a commodity supplier of country A. ..

Due to the price drop, the output of country A decreased to OQ3. Q 1Q2 is the quantity of products that should have been imported from country C, but now it is replaced by the production of country B, which is the transfer of trade. Q 1Q3 is the part where the production of country A is replaced by that of country B, which is the production effect. The decline in prices has led to an increase in consumption in country A, and consumption has increased from OQ2 to OQ4. The net increase in consumption in the second quarter is the consumption effect of the customs union.

After the formation of the customs union, the import of country A expanded from the original Q 1Q2 to Q3Q4, and the new trade created an effect for trade.

Trade creation effect = production effect+consumption effect

= q 1q 3+qq4

Trade diversion effect = q1q 2;

3, the welfare effect of customs union:

After the formation of the customs union, the consumer welfare in country A has been improved, while the producer welfare has declined:

Increase of consumer surplus =a+b+c+d

Reduction of producer surplus =-a

The original tariff income from country C was c+e, but now it is imported from allies, and it is lost.

Net welfare effect = b+d-e

Among them: the welfare effect created by b+d for trade; E is the welfare effect of trade transfer and the distortion of resource allocation caused by the replacement of low-cost production from outside the alliance by high-cost production within the alliance.

Conclusion1:The greater the price elasticity of supply and demand in country A, the more obvious the welfare effect created by trade.

Conclusion 2: The higher the tariff level of country A before the formation of customs union, the greater the welfare effect created by trade after the formation of customs union. The welfare effect of trade diversion is even smaller.

Conclusion 3: The closer the cost between B and C, the smaller the welfare loss of trade transfer.

Second, the export expansion effect of customs union.

As shown in the figure, the left part of the figure shows the production, consumption and export of country A, and the right part shows the production, consumption and export of country B. ..

Assuming that the production cost of country C is fixed, the world price of the product before the formation of the customs union is Pw, which is equal to the production cost of country C, and country B imposes tariffs on imported goods from all countries, and the price after taxation is Pt. At this time, the export of country A is fg, and the import of country B is ab, and some of them come from country A, ac=fg. The rest of the imports are imported from country C, and the import volume is cb.

After the customs union between Party A and Party B, the price of goods of Party A in the domestic market of Party B is lower than that of similar goods of Party C, because Party B is exempt from import tariffs on goods imported from Party A, but still imposes tariffs on goods imported from Party C ... So Party B only imports from Party A..

Because the import demand of country B is greater than the export supply of country A at this price when the tariffs of country A and country B are just cancelled, the domestic sales price of goods in country B will rise due to the shortage of goods. When the price rises, the domestic output of country B and the quantity that country A is willing to export will increase. When the price rises to Pu, the trade between country A and country B will reach a balance, and the export volume of country A is equal to the import volume of country B, that is, hi=de, and then the trade between the two countries will reach a balance.

Conclusion: For country A, joining the customs union can expand exports and increase export income, which is beneficial to the economic development of country A. ..

Third, the dynamic effect of customs union.

1. market expansion effect: after the establishment of the customs union, it has created favorable conditions for the mutual export of products among member countries while excluding products from third countries. The domestic market of each member country has formed a unified regional market, which has promoted the development of enterprise production, enabled producers to continuously expand production scale, reduce production costs and enjoy the benefits of economies of scale. But also can further improve the competitiveness of enterprises in the alliance against similar enterprises in non-member countries.

Conclusion: The market expansion effect created by customs union leads to the realization of scale economy of enterprises, thus effectively reducing the production cost of products.

2. Promote competition among enterprises in member countries.

Before the member countries formed a customs union, many departments had formed domestic monopolies, and several enterprises occupied the domestic market for a long time and obtained excessive monopoly profits. Therefore, it is not conducive to the allocation of resources and technological progress in various countries. After the formation of customs union, due to the mutual opening of national markets, enterprises in various countries are facing competition from similar enterprises in other member countries. Whoever wins in the competition will enjoy the economies of scale brought by the expansion of demand in the big market. Otherwise it will be eliminated.

In order to gain a favorable position in the competition, enterprises will inevitably improve the efficiency of production and operation, increase investment in research and development, enhance the awareness of adopting new technologies, and continuously reduce production costs, thus creating a strong competitive atmosphere within the alliance, improving economic benefits and promoting technological progress.

3. It is conducive to attracting foreign investment.

The establishment of a customs union means excluding products from non-member countries. In order to offset this adverse effect, countries outside the union may transfer their production points to some countries within the customs union and directly produce and sell their products locally, thus bypassing the unified tariff and non-tariff barriers. In this way, objectively, there has been a capital inflow accompanied by production transfer, attracting a large number of foreign direct investment.

Case 9-2: China-ASEAN will start the process of tax reduction, and a free trade area is taking shape.

/kloc-0 At the meeting of the China-ASEAN Trade Negotiating Committee held in Beijing at the end of 0/0, the two sides reached an agreement on the most important trade agreement in goods in the free trade area negotiations.

According to this agreement, the process of tax reduction in China-ASEAN Free Trade Area will be fully started from 2005, and the tariffs on most products of both sides will be reduced to zero by 20 10. On the basis of reaching an understanding, the two sides are expected to sign an agreement on trade in goods during the China-ASEAN leaders' meeting this month.

According to the statistics of the Ministry of Commerce, from June 5 to August this year, the trade volume between China and ASEAN reached US$ 65.6 billion, up 38% over the same period last year. This year, the bilateral trade volume is expected to exceed 1000 billion US dollars.

Traditional free trade areas (FTAs) mostly focus on the liberalization of trade in goods, while East Asia's free trade agreements attach importance to the liberalization of other aspects, including trade in services, besides the liberalization of trade in goods. The China-ASEAN Framework Agreement on Comprehensive Economic Cooperation itself is named after "comprehensive economic cooperation". According to this framework agreement, the two sides will complete negotiations on trade in goods, trade in services, investment facilitation and labor services in turn, and finally reach a comprehensive free trade agreement.

Trade in goods is the core content. The direct purpose of goods trade agreement is to reduce the tariff barriers of goods import and export in bilateral trade. Through the process of EU economic integration, we can know that this regional economic integration is a gradual and in-depth process. Reducing trade tariffs and barriers of member countries is the lowest level of integration and the starting point of the whole integration process.

In fact, before this, Thai fruits had already entered China with zero tariff preference. According to the zero tariff agreement between China and Thailand on fruit and vegetable products, the import and export tariffs on 88 kinds of agricultural products such as vegetables and fruits between the two countries have been reduced from an average of 30% to zero since June 2003 1. This is part of the "Early Harvest Plan".

This plan, called "Early Harvest", has been implemented since June 5438+1 October12004, which mainly means that China reduced taxes on a series of agricultural products and manufactured goods from ASEAN before the China-ASEAN Free Trade Area Agreement was finally completed. In return, ASEAN has proposed a tax coordination system, that is, China's agricultural products such as meat, fish, fruit and milk will receive preferential tariffs from ASEAN. This will be the first wave of plans to cancel tariffs in the free trade zone.

The rapid growth of China-ASEAN trade volume from June 5th to August this year is the positive result of "Early Harvest Plan".

Agriculture still accounts for a considerable proportion in the economic base of ASEAN member countries. China really needs this kind of products. At the same time, in order to increase the export volume, many ASEAN countries are also happy to export agricultural products to China. Therefore, the "Early Harvest Plan" has benefited most ASEAN countries.

With the reduction of taxes on a series of agricultural products between China and ASEAN and the implementation of zero tariffs on fruits and vegetables between China and Thailand, China's huge domestic market will provide a broad market space for ASEAN.

The "early harvest plan" tax reduction includes 600 agricultural products, accounting for110 of the total, and the remaining 90% items are included in the goods trade agreement. Its content focus has also shifted from agricultural products to industry, which will be the second wave of tariff abolition plan.

A trade and development report recently released by the United Nations pointed out that "the most serious challenge to China's product export is mainly the labor-intensive industrial production sector, including the assembly industry of electronic products, that is to say, the competition faced by middle-income producers in ASEAN countries and Mexico is the most obvious." After the signing of the agreement on trade in goods, China, the most competitive industrial production sector, will become the biggest beneficiary of the Southeast Asian market.

Take Singapore as an example. Although Singapore, as a non-agricultural country in the "early harvest plan", has not gained much, on the other hand, the trade volume between China and Singapore has increased fourfold in the past 10 years. In the first four months of 2004, Singapore's exports to China increased by 50.6%, much faster than its trade with Japan. Now, with the signing of the goods trade agreement and the beginning of the tax reduction process, Singapore will only benefit more and more.

These data support the view that the China administration has always said that China's economic growth and opening up are not only beneficial to developed countries such as the United States and the European Union, but also beneficial to neighboring developing countries with an open China economy.

"China is creating a new model of regional economic ties and a dynamic economic growth mechanism." Zhang Yunling said that the ASEAN region is undergoing structural adjustment due to the Asian financial crisis, while the economic cooperation between China and ASEAN is showing a sustained growth trend against the background of slowing world economic growth, and "a new value chain is taking shape".