The Sectoral Impact of China's Access to the WTO - A Dynamic CGE Analysis

Xuesong Li and Arjan Lejour ()
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Xuesong Li: Chinese Academy of Social Sciences

No 210, Trade Working Papers from East Asian Bureau of Economic Research

Abstract: This paper focuses on the sectoral impact of China’s accession to the WTO based on a recursive dynamic CGE model for China. We take into account both tariffs cut and non-tariff equivalents reduction. Moreover, we model also the phasing out of the MFA agreement and take account of the broad tariff exemptions. The 40 sectoral dynamic model is based on the latest database in 1997. The analysis is carried out 2010. We find GDP rises 0.8 percent and the household welfare gain (EV) reaches $4 billion in 2010 for the whole WTO package, but the exchange rate is devaluated slightly. Export expands in most sectors especially in textiles and wearing apparels, but falls in agriculture, food products and tobacco and electronic and telecommunication equipment. Import goes up in almost all sectors especially in such high-protected sectors as agriculture, transport equipment, post and telecommunication service, and finance and insurance. Most industrial sectors benefit from China’s access to the WTO, especially textiles and wearing appeals, but many service sectors are hurt.

Keywords: WTO; China; Dynamic CGE; accession; tariff; import; export (search for similar items in EconPapers)
JEL-codes: F13 O19 D24 (search for similar items in EconPapers)
Date: Written
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