China's Integration into the World Economy Implications for Developing Countries
30 Pages Posted: 15 Feb 2006
Date Written: December 2003
Although the rest of the world had waited a long time for China to open up, feelings were mixed when it actually did and began to integrate rapidly with the world economy. With the country`s recent accession to the World Trade Organization (WTO), many of its trading partners are increasingly concerned that China`s competition in the world goods and capital markets may adversely affect their own growth prospects. This paper examines the implications of China`s WTO accession for other developing countries in the context of the country`s long-term process of growth and opening up. The paper argues that China`s integration into the world economy will inevitably impose adjustment costs on its trading partners in the short-to-medium term, but the benefits it generates are likely to dominate in the long run.
Keywords: China WTO accession export competition FDI diversion developing countries
JEL Classification: F13 F14 F15
Suggested Citation: Suggested Citation