Unlocking Trade Potentials in China-ASEAN Relations: The China-Vietnam Context

24 Pages Posted: 21 Oct 2017

See all articles by Evelyn Shyamala Devadason

Evelyn Shyamala Devadason

University of Malaya (UM)

Vgr Govindaraju

University of Malaya (UM) - Department of Development Studies

Date Written: October 20, 2017

Abstract

The China-ASEAN trade relationship is multidimensional. The trade situation between China and Vietnam is not similar to that of China and the ASEAN5, as the former records trade surpluses with Vietnam in agriculture and manufactures. Bilaterally, China’s exports are also more homogeneously distributed relative to Vietnam, and comprise higher value-added intermediates. Despite the asymmetry in terms of economic capacity between China and Vietnam, it is not one-sided nor is it all downside, as there is a high level of economic interdependence between the two. The empirical results from the stochastic frontier analysis indicate that Vietnam’s trade efficiency with China is somewhat comparable with the levels achieved by the other ASEAN members in trade with China. Importantly, Vietnam’s exports of agriculture products to China are operating closer to its potential level than China’s exports to Vietnam. Overall, there remains scope for an improved efficiency of two-way bilateral exports in the China-Vietnam partnership. It is therefore seemingly untrue to assume that only the larger side could get more from this relationship.

Keywords: gravity; stochastic frontier analysis; trade efficiency; China; ASEAN; Vietnam

Suggested Citation

Devadason, Evelyn Shyamala and Govindaraju, Vgr, Unlocking Trade Potentials in China-ASEAN Relations: The China-Vietnam Context (October 20, 2017). Available at SSRN: https://ssrn.com/abstract=3056354 or http://dx.doi.org/10.2139/ssrn.3056354

Evelyn Shyamala Devadason (Contact Author)

University of Malaya (UM) ( email )

Kuala Lumpur, Wilayah Persekutuan 50603
University of Malaya (UM)
Kuala Lumpur, Wilayah Persekutuan 50603
Malaysia
+603-79673721 (Phone)

HOME PAGE: http://https://umexpert.um.edu.my/evelyns.html

Vgr Govindaraju

University of Malaya (UM) - Department of Development Studies ( email )

Kuala Lumpur, Wilayah Persekutuan 50603
Malaysia

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