The Impact of the Second Phase of China-South Korea FTA Negotiation on China's Service Trade -- Simulation Analysis Based on GTAP Model

Abstract

The second phase of China-South Korea FTA negotiation is underway, its main negotiation content is focused on the service trade and investment field, this is the first time for China to carry out the negative list mode of related negotiations, and has made substantial progress at this stage, is expected to sign the agreement in the past two years. However, from the perspective of the second stage negotiations between China and South Korea, there are relatively few studies to analyze the possible impact of the signing on China, especially on various industries of service trade. Therefore, this paper takes the negotiation as the background, takes the service trade as the research object, and on the basis of fully analyzing the development status of the service trade between China and South Korea, uses the GTAP model to empirically analyze the impact of the reduction of service trade barriers in three different scenarios on the macro-economy and service trade of China and South Korea, and draws a conclusion: The conclusion of this negotiation will bring a very obvious positive effect to China and South Korea, and the positive effect will increase with the degree of service trade opening between the two countries, and on this basis, corresponding policy suggestions are given.