Effects of International Intra-product Specialization and Trade on Trade Balance of China

In the context of international intra-product specialization and trade,processing trade and trade in parts and components are the main patterns and contents of China's foreign trade and have large effects on the trade balance of China.Statistics shows that processing trade surplus is mainly due to capital and technology intensive products and excesses overwhelmingly China's total commodity trade surplus,whereas processing trade of labor and natural resources intensive products contributes little or negatively to China's total trade balance.Trade in parts and components has a deficit and accounts for a large share of China's trade balance,with deficit mainly from machinery sectors and surplus from miscellaneous products.Trade deficit for parts and components indirectly accounts for the problem of large trade surplus with low domestic value-added in China.