Research on Export Potentialities of China’s Goods Trade to Countries along the Belt and Road Based on the Augmented Gravity Model

Abstract

Economic and trade cooperation is the focus of the Belt and Road initiative. Based on gravity model, this paper analyzes the factors that affect the export trade potential of China by using China’s export data of goods to countries along the Belt and Road between 2005 and 2016, and measures the export trade potential from China to countries along the Belt and Road in 2016. The results show that GDPs and indices of trade freedom of China and countries along the belt and road, the population of countries along the Belt and Road, distance between China and the countries along the Belt and Road and common language are key factors that influence the export potential of China’s goods, but the free trade agreement is not the main factor that affects the trade potential of China to countries along the Belt and Road. In terms of export trade potential, the countries along the Belt and Road are divided into three types, and they are “potential reshapingâ€, “potential pioneering†and “huge potential†respectively. Finally, based on the conclusions of the empirical analysis, this paper puts forward some proposals to expand China’s exports to the countries along the Belt and Road.