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How Would China's Exports be Affected by a Unilateral Appreciation of the RMB and a Joint Appreciation of Countries Supplying Intermediate Imports?

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  • Mizanur RAHMAN
  • Willem THORBECKE
Abstract
In 2005 55% of China's exports were "processed exports" produced using intermediate goods that came from other countries. The lion's share of the volume of imports for processing and of the value-added of processed exports came from other East Asian countries. We investigate how a unilateral appreciation of the RMB and a joint appreciation of countries supplying intermediate inputs would affect China's exports. To do this we estimate a panel data model including ordinary and processed exports from China to 33 countries. Results obtained using generalized method of moments techniques indicate that a joint appreciation would significantly reduce China's processed exports while a unilateral appreciation would not.

Suggested Citation

  • Mizanur RAHMAN & Willem THORBECKE, 2007. "How Would China's Exports be Affected by a Unilateral Appreciation of the RMB and a Joint Appreciation of Countries Supplying Intermediate Imports?," Discussion papers 07012, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:07012
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    References listed on IDEAS

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    Cited by:

    1. Willem Thorbecke & Gordon Smith, 2010. "How Would an Appreciation of the Renminbi and Other East Asian Currencies Affect China's Exports?," Review of International Economics, Wiley Blackwell, vol. 18(1), pages 95-108, February.
    2. Mizanur Rahman & Kaliappa Kalirajan, 2009. "The effect of a collective exchange rate adjustment on East Asian exports," Economics Bulletin, AccessEcon, vol. 29(4), pages 2853-2859.
    3. Françoise Nicolas, 2008. "The political economy of regional integration in East Asia," Economic Change and Restructuring, Springer, vol. 41(4), pages 345-367, December.
    4. Shaghil Ahmed, 2009. "Are Chinese exports sensitive to changes in the exchange rate?," International Finance Discussion Papers 987, Board of Governors of the Federal Reserve System (U.S.).
    5. Françoise Nicolas, 2010. "De Factoandde Jureregional Economic Integration In East Asia: How Do They Interact," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 55(01), pages 7-25.
    6. Hooy, Chee-Wooi & Siong-Hook, Law & Tze-Haw, Chan, 2015. "The impact of the Renminbi real exchange rate on ASEAN disaggregated exports to China," Economic Modelling, Elsevier, vol. 47(C), pages 253-259.

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