Development of East Asia Regional Production Network and the Status of Participating of China

Abstract

With the transformation of the international division of labor pattern, the East Asia1 regional economy also broke through the original “Flying Geese Model” to form the East Asia production network, and became an integral part of the global production network. As the center of the East Asia production network, the trade volume inside the region of China rose year by year, which was displayed by importing the parts and components in quantity from the region and exporting to USA, EU and other countries outside the region with the manufactured goods upon processing. It has always played an intermediate hub role in the “Star Trade” inside and outside the East Asia region, resulting in the export benefits shared by various countries of East Asia for a long time. Moreover, the favorable balance of trade has recorded the situation of continuously increasing trade friction in China. This paper analyzes the reason for the formation of the East Asia production network, and further discusses the characteristics of the East Asia regional production network, with the main expression of three aspects involving the decentralization, “Star Trade”, and vulnerability of the regional production network. Based on this, it analyzes the coinditions for the intermediate goods trade and final manufactured goods trade of China in the East Asia regional production network, points out the hub status of China in the East Asia regional production network, and analyzes the characteristics of the industry of China participating in the East Asia regional production network. This paper finally proposes the measures that China should improve the utilization rate of the free trade area in the East Asia regional production network, coordinate and unify, simplify the preferential rules of origin, and adopt the incentive measures to attract the medium-sized and small enterprises to join the regional production network, so as to enhance the operating efficiency of the overall East Asia regional production network.
Key words: Preferential rules of origin; East Asia regional production network; “Star Trade”