Effects of Trade Facilitation Measures on Trade Between China and Countries Along the Belt and Road Initiative

Abstract

As facilities connectivity and unimpeded trade are two key issues in the Belt and Road Initiative (BRI), they have important implications for policymaking and economic development. This chapter builds a trade facilitation index system to assess the trade facilitation of 64 Belt and Road countries (BRC) during 2011–2014, then uses gravity models to study the effects of trade facilitation measures on trade flows between China and these countries. The results show that trade facilitation has the biggest positive relationship with bilateral trade. When looking into the level indicators, the authors found that regulatory environment and financial environment have no significant impacts on bilateral trade, while port efficiency is the key factor in promoting bilateral trade. The BRC might highlight their trade facilitation by guiding the investment and management in infrastructure and by improving their administrative efficiency.