Law, Trade and Finance
- Asian Commercial, Financial and Economic Law and Policy series
Edited by Ross P. Buckley, Richard Weixing Hu and Douglas W. Arner
Chapter 5: China’s Strategy for Free Trade Agreements: Political Battle in the Name of Trade
Henry Gao Compared with Europe and America, East Asia is a latecomer in the new gold-rush of free trade agreements (FTAs). In this process, China has played a significant role. This is not only due to the growing economic clout of China but also because China has taken a conscious strategy to push for economic integration in the region. Thus, for the benefit of the countries in the region, it is very important to understand China’s FTA strategy. This chapter starts with the evolving picture of China’s FTA web, then discusses the key components of China’s FTA strategy, and concludes by noting the implications of China’s FTA strategy on the region and beyond. OVERVIEW OF CHINA’S FTAS While China adopted an export-oriented development model when it started its economic reform in the late 1970s, it did not contemplate the possibility of entering into FTAs until much later for the following reasons. The first reason is the general hostile attitude towards FTAs. Throughout the 1970s and 1980s, there was little interest in FTAs. It was only in the early 1990s that countries around the world started to engage in FTAs seriously. Indeed, of the most important FTAs existing in the world today, such as the EU, NAFTA, MERCOSUR and ASEAN, most only took their current form in the 1990s. In particular, Asian countries lag behind their European and American counterparts when it comes to FTAs. Thus, even if China had been interested in FTAs then, it would have had difficulty in...
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