Amid Trade War, A Look at China’s Role in Global Economy

Author: Michael

China Still Hasn’t Opened Its Door Despite Transforming into a Global Power, Source: Nikkei

The beginning of US-China trade war marked a new phase of economic relationship between China and the rest of the world. For the past 3 decades, China has become a global power in scale (transforming the world’s largest economy in terms of purchasing power parity, PPI), but failed to match that efforts in global integration. More than 80% of the revenue of its largest 100 companies is earned domestically. Most notably, China’s banking, securities, and bond markets rank in the global top 3 in size, but international players have very limited presence. Chinese government has imposed operational and regulatory complexities in most of its important domestic markets. To gauge the extent of its integration with the world, here are several aspects we can look into:

TRADE

China has become a major global player in trade both as a supplier and as a market. Since 2009, China has stayed atop the world’s goods exporter. It became the largest trading nation in goods in 2013. Between 2000 and 2017, China’s share of global goods trade increased from 1.9% to 11.4%. According to trading data, China is the largest export destination for 33 countries and the largest source of imports for 65 countries. The incredible trading exposure to China has given China disproportionately high impact…