Impact of participation in the belt and road initiative on regional economic resilience at province level

PurposeThis study aims to examine how participation in the Belt and Road Initiative (BRI) affects province-level regional economic resilience. In the context of dual circulation - the new development paradigm proposed by the Chinese Government - participating in the BRI is an important means of connecting both international and domestic circulations and achieving high economic resilience. The complex causal relationship between participation in the BRI and province-level regional economic resilience is investigated. Design/methodology/approachBased on the complex system view, this study uses fuzzy set qualitative comparative analysis (fsQCA) to examine the impact on regional economic resilience when provinces participate in the BRI through unimpeded trade, infrastructure connectivity, financial integration and people-to-people bonds under the two conditions of attention allocation and buffering capacity. Qualitative textual analysis is applied to analyse provincial work reports, and relevant statistical data are used to measure the economic resilience from 2013 to 2020. FindingsThe authors identified three condition configurations that lead to a high regional economic resilience at province-level and one condition configuration that lead to no high-level regional economic resilience. Research limitations/implicationsIn-depth analyses of qualitative materials should be conducted to explain the systematic relationships among the conditions. Originality/valueThis research is of practical significance to the development of the theoretical framework and practices of the BRI in the context of dual circulation.

China's ‘Dual Circulation' Strategy: Urgent Needs for Greater Economic Self-reliance

China's rapid development, huge economic output, national strength, and improvement of people's living standards are the remarkable results of the transformation from being an isolated economy to a highly globalized one since 1978. In recent years, China's economy has undergone profound challenges from the international environment such as rising protectionism, economic stagnation, and the COVID-19 pandemic. In such a context, the dual circulation strategy (DCS) has been introduced by the Chinese Communist Party (CCP) as a new economic model for the next five years and beyond, aimed at boosting China's domestic demand and simultaneously creating favourable conditions for domestic and overseas markets to complement each other. This study emphasizes the necessities of transforming to DCS because of both prominent contradictions in the internal economy as well as complex changes in the international economic environment. It also affirms that China's new economic model is towards a more sustainable economy to hedge against external risks. © 2022, Institute of China Studies. All rights reserved.

China 2021: Coping with the resilience dilemma of the Chinese model

In 2021 Chinese internal politics were dominated by the domestic economy and the COVID-19 pandemic. The celebration of the 100th anniversary of the Chinese Communist Party (CCP) worked well to project the numerous successes of Chinese politics through history. Yet, Beijing's insistence on the need to rethink the developmental path of China's economic model also demonstrates the extent to which the important engines that have driven China's growth in the past four decades must now be diverted to an internal dimension. This is the case of the dual circulation strategy and the common prosperity policy, whose guidelines are envisioned by Chinese leaders and political elites to transform the country's existing growth model through a fully fledged internal rebalancing, and which spared not even the once unscrutinized, cross-border flow of data coming out of China.

The Impact of Government Behavior on the Development of Cross-Border E-Commerce B2B Export Trading Enterprises Based on Evolutionary Game in the Context of "Dual-Cycle" Policy

In 2020, the COVID-19 pandemic had a major impact on China's foreign trade. Therefore, the Chinese government has proposed a "dual cycle" policy to promote economic development. In 2021, China's cross-border e-commerce B2B exports accounted for 60 percent. Therefore, this paper studies the impact of government actions on the development of cross-border e-commerce B2B export enterprises under the background of "dual cycle" policy. First, the policies related to the cross-border e-commerce industry in the "dual circulation" policy are screened, and the LDA topic model is used to classify them, i.e., sorting by topic intensity as "fiscal policy", "tax policy", "customs clearance policy", "payment policy" and "talent policy". After that, based on the analysis results of the LDA topic model, a theoretical basis for the impact of different policies on cross-border e-commerce B2B export companies is established;then an evolutionary game model between the government and cross-border e-commerce B2B export enterprises is constructed. This article also carried out experiments to verify our analysis. The simulation results show that: (1) The government's appropriate increase in subsidies, tax incentives, infrastructure investment, talent introduction and cultivation, optimized payment system, and supervision can promote enterprises to participate in cross-border e-commerce B2B export trading;(2) excessive government supervision reduces enterprises' enthusiasm to participate in cross-border e-commerce B2B export trading;(3) the government's subsidies, tax incentives, and supervision strength have the greatest impact on whether enterprises participate in cross-border e-commerce B2B export trading, followed by the government's investment in cross-border e-commerce infrastructure, the introduction and cultivation of cross-border e-commerce talents, and the improvement of the payment system. Finally, this paper puts forward relevant policy recommendations to promote the development of cross-border e-commerce B2B export enterprises.

The ‘Dual Circulation' development model of China: Background and insights

Purpose>Global supply chains experienced unprecedented changes in 2020 and the relationship between domestic and global markets needed adjustments considering the long-term impacts of the changes that are unfolding around these markets. China has become the first country to announce a formal strategy – "Dual Circulation” Strategy (DCS) – to guide its self-reliant economic development in the post-COVID era. However, what exactly is the DCS and what drove China to publicize this strategy is not yet clear. This study aims to answer these questions.Design/methodology/approach>Based on an extensive review of literature and media reports, a background has been constructed that justifies the DCS as a long-overdue historic necessity.Findings>A novel definition of "Dual Circulation” is introduced. A novel construct to visualize the domestic circulation in light of international and domestic markets and international circulation has been presented. The study argues that maintaining optimum levels of consumption and saving rates is crucial to the DCS's success.Originality/value>The study pioneers the first scientific definition of the "Dual Circulation” that will pave way for future debate on the topic. Also, it is the first time an academic study on the DCS has been executed.

Identifying the key factors to China's unsustainable external circulation through the accounting of the flow of embodied energy and virtual water

In 2020, China launched the Dual Circulation Strategy to tackle difficult international trade situations and COVID-19. To examine the environmental pressure induced by China's domestic and international trade from the perspective of dual circulation, this study quantifies the flows of embodied energy and virtual water in China's domestic and international trade and analyzes the driving factors to the net outflow, using the multi-regional input-output model and spatial structural decomposition method. The main findings of this study are: (1) Domestic trade of China alleviated the pressures of both energy and water shortage through the flow of embodied energy from Northern to Southern and Eastern regions and the flow of virtual water from Southern to Northern regions. In contrast, international trade yet increased China's environmental burden and tends to be unsustainable. (2) Production structure effect was the key factor to the net outflow of embodied energy (contribution degree: 58%) and virtual water (contribution degree: 46%) to major economies. For China, the export scale effect and export structure effect played an important role in increasing the net outflow of China's embodied energy, with contribution degrees of 17% and 23%, respectively, while the export structure effect and water efficiency effect reduced the net outflow of virtual water, with contribution degrees of −23% and −19%, respectively. Multidimensional Policies, including industrial structure transition, renewable energy deployment, resource efficiencies improvement, trade pattern upgrade, and regional free trade promotion, are suggested for implementing the Dual Circulation Strategy, considering environmental sustainability and industrial competition advantages. © 2022 Elsevier Ltd

The “Dual Circulation” strategy: China’s response to declining international economic connectivity1

The rise of protectionism in Europe and the US, as well as downward trends in international trade, investment, and production, are major aspects of the current decline in international economic connectivity. The lockdown due to the COVID-19 pandemic has additionally weakened relations between economies. All these considerations have prompted economic planners in China to redefine strategies for future development. The response to these disruptions have been a development paradigm, dubbed “Dual Circulation, " referring to the partial separation of “internal circulation, " the domestic cycle of production, distribution, and consumption, from “external circulation, " based on export demand. “This paper shows that due to timely adjustment of economic policies in the past, “Dual Circulation” is a highly feasible and optimal solution for the continuation of China’s development based on the most suitable level of international economic connectivity. © 2023 selection and editorial matter, Liu Zuokui and Branislav Ðordevic;individual chapters, the contributors.

Cooperation, open and upgrade: How does foreign ownership structure affect the skill upgrade of domestic-sale and export enterprises?

Faced with the double shock of COVID-19 and Sino-US trade conflict, how to upgrade technology and products and then establish a "dual circulation" development pattern has become the major challenges for Chinese government and enterprises. Under the framework of heterogeneous enterprise theory, this paper introduces foreign ownership structure into enterprise skill demand function, and discusses the influence of foreign ownership structure on the skill upgrade of export enterprises and domestic enterprises. And this paper make empirical verification for the model deductions, based on the data of industrial enterprise from 2000 to 2008. The results confirm that:1) The skilled wage of export enterprises are always higher than that of domestic enterprises based on the same proportion of foreign capital;2) The skilled wage of domestic-sale and export firms will increase with higher proportion of foreign capital, but the characteristics of the latter only holds for foreign-ownership enterprises;3) Once the proportion of foreign exceed 0.5, it will induce a dramatic change for corporate culture, and thus impulse the skilled wage jump up into a higher level which is more prominent among exporters. It is showed that continuing to expand the level of opening to the outside world, lifting control on foreign capital, strengthening the cooperation between domestic and foreign capital can more effectively promote the technology promotion and skill upgrading of Chinese enterprises, and jointly accelerate the establishment of an expanding domestic market and a leading trade power. © 2022 Systems Engineering Society of China. All rights reserved.

CHINA 2021: COPING WITH THE RESILIENCE DILEMMA OF THE CHINESE MODEL

In 2021 Chinese internal politics were dominated by the domestic economy and the COVID-19 pandemic. The celebration of the 100th anniversary of the Chinese Communist Party (CCP) worked well to project the numerous successes of Chinese politics through history. Yet, Beijing’s insistence on the need to rethink the developmental path of China’s economic model also demonstrates the extent to which the important engines that have driven China’s growth in the past four decades must now be diverted to an internal dimension. This is the case of the dual circulation strategy and the common prosperity policy, whose guidelines are envisioned by Chinese leaders and political elites to transform the country’s existing growth model through a fully fledged internal rebalancing, and which spared not even the once unscrutinized, cross-border flow of data coming out of China. © Viella s.r.l. & Associazione Asia Maior.

The Circular Economy: A Critique of the Concept

The circular economy is an increasingly influential school of sustainable economic thinking, dominating recent five-year plans in Chinese policy and regularly featuring the sustainability discourse in the European Union and beyond. It is often said that the history of a concept tells us more about it than the concept itself, so we begin by contextualizing the circular economy through its historical development. We then compare and contrast the two dominant geopolitical versions of the circular economy, the Chinese and Western (European) models, identifying differences and issues in underlying principles. Particular attention is paid to the impact of populist economics and the COVID-19 pandemic. The Dual Circulation Strategy of the 14th Five-Year Plan is then examined. In order to explore the current and future prospects for the circular economy, we explore the Earth system, on which, ultimately, our species relies upon. By teasing apart its functionality, two levels of organization emerge: local and global. The chapter ends by exploring the concept of sustainable economics and concludes by identifying the key characteristics of such a concept. © 2022, The Author(s), under exclusive license to Springer Nature Switzerland AG.

Measuring the Intermediate Goods’ External Dependency on the Global Value Chain: A Case Study of China

In the face of the anti-globalization trend and the shrinking of the global value chain, ensuring the safety of the global layout of the industrial chain and the sustainability of each country’s internal intermediate product production cycle has become an important new development strategy for all countries. The sustainability of the internal and external cycles of production systems is closely related to global value chains. Based on the world input-output model, we define the trade pattern of intermediate goods in various countries from the perspective of trade intermediary attributes, and propose two indicators by which to measure the dependence of China on the global value chain in the process of “dual circulation” development: the degree of vertical specialization (VSD) and the import share of domestic total consumption (IMS);China’s super-large market leads to low values of both VSD and IMS. China’s high-tech industry has the highest degree of external dependence in the process of participating in dual circulation, and there has been a fluctuation cycle since 2009. The external dependence of different industries shows heterogeneity.

On the global COVID-19 pandemic and China's FDI.

The global COVID-19 pandemic has generated serious challenges for the world economy, including cross-border foreign direct investment (FDI). China's inward FDI (IFDI) and outward FDI (OFDI) are also facing unprecedented risks and challenges. This paper first clarifies the timelines of the pandemic evolving in China, the US, and the rest of the world. It then reflects on China's past development process of IFDI and OFDI, noting the growth of IFDI and highlighting the risks and challenges for OFDI during and after the pandemic. Empirical evidence for the impact of COVID-19 on FDI is set out. Policy recommendations are then made regarding China's latest development strategy using the so-called dual circulation to sustain its economic growth with respect to cross-border FDI.