Competitiveness changes in China's quality vegetable exports post-WTO

Purpose - The purpose of this paper is to examine patterns of recent change in China's international export trade in high quality fresh-vegetables between 2002 and 2005 since its WTO membership and some of the underlying determinants that will determine its future export opportunities. Design/methodology/approach - A trade-shares accounting and decomposition approach is adopted which enables the sources of change in China's aggregate export market shares be identified in terms of both structural effects (SEs) through the share-shifts in world trade of its major trading partners and performance effects (PEs) of changes in China's penetration of individual markets. Findings - China's underlying comparative advantage in labour-intensive products such as fresh vegetables is reflected in the positive PE of its increase in share of world trade since WTO membership. There has been an emerging re-orientation in its trade shares from E Asia to SE Asia, and to further penetration into the Russian Federation and US markets, but little overall evidence of significant enhanced penetration of developed country markets. Research limitations/implications - The methodology, whilst identifying the predominant sources of dynamic changes in trade shares, does not explain or model the causes of such developments. However, as such it is useful in focussing attention on where significant changes have taken place and hence where further research into modelling such bi-lateral or multilateral trade flows would be fruitful. Originality/value - Hitherto competitiveness studies have tended to focus either on aggregate trade flows, or at the broad sectoral level such as agriculture. Those in relation to China have also tended to be of a predictive nature in assessing the potential WTO impact on China's trade and agriculture. This study addresses China's actual trade performance at the product category and individual product level, and examines the strategic implications for China's fresh produce export sector. It also assesses whether the initial expectations of positive gains in exporting fresh vegetables have been realised thus far, and what adjustments in China's global trading patterns have emerged in this sector.