| This paper analyses the impact on China's economy from its accession to the WTO. Using a two-region Chinese CGE model, the analysis shows the gains China would derive from a more efficient allocation of resources and from the elimination of MFA quota. It also indicates that the gains are unevenly distributed across sectors and across provinces. The paper's most original contribution is to assess the impact at the regional level. The coastal area, epitomized by the Guangdong province, would be the main beneficiary, due to its specialisation in labour intensive goods. However, inland provinces, especially those specialised in agriculture, would suffer losses. WTO membership would lead to widening regional disparities and loosen the already weak economic linkages between coastal area and the rest of the economy. The paper concludes that the government should enhance domestic regional integration through inter-provincial trade facilitation measures. |
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