Two or more countries do not automatically trade with each other. They have to be open to it. This is exactly how you and I shop. We choose a shop, and go to it. The shop then has the right to refuse service to us. While this may not be obvious to us, there are certain exclusive experiences that only let members in. Global trade is a similar kind of setup. Fortunately, trade has been more open now than it has been in the past decade. However, certain certain state measures, such as those biased against foreign commercial interests, have been on the rise since 2008, and exceed the number of measures that improve trade transparency. One of the countries that has come to the forefront of the world trade in the last couple of decades has been China, and it presents a very interesting case. China shows off significant GDP expansion in the past decade, mainly resulting from investment growth rather than trade. The above image is an extract from an infographic, and more detail, specifically on how China and the top economies of the world are behaving can be found on it.
Of course, China’s new economic diplomacy affects all the planet. China has grown to be a significant force in global trade over its 36 years of reform, but for most of that time it has not assumed a strong leadership role in trade governance, opting instead to integrate into existing systems. With the launch of the One Belt, One Road (OBOR) initiative in 2013, and the creation of new multilateral financial institutions led and largely capitalised by China, the country may have turned a corner in its international economic policy. A report on China’s new economic diplomacy finds out what it means for regional and global trade liberation, and for business in general.