Global Political Economy Seminar - Chinese Firms in the Trade War

POLIS is delighted to bring you this first seminar as part of its Global Political Economy series! This event is the first of five seminars focussing on China and the GPE.

Monday 5^th February 2024 | Online | 18:00-20:00 (GMT)

Speakers: Professor Ka Zeng (University of Arkansas) and Associate Professor Soo Yeon Kim (National University of Singapore)

‘Chinese Firms in the Trade War: Decoupling through Reshoring?’

Abstract

As the largest commercial conflict in modern history, how has the US–China trade war affected commercial relations between the two largest economies in the world? This presentation leverages firm-level data to examine the impact of the trade war on the greenfield investment of Chinese investors. Our research yields a few interesting findings. Importantly, our longitudinal analysis of Chinese greenfield investment projects yields some evidence that the tariffs have dampened overall Chinese investment. Further analyses for different world regions indicate that while the tariffs have generally had a chilling effect on Chinese investment in most world regions, they may have prompted Chinese investors to engage in "tariff-jumping", that is, to evade the tariffs on their exports to the US by establishing production facilities in the US market. Our analysis further shows that the trade war may have incentivized Chinese investors to increasingly invest in countries with good political ties with Beijing, in particular in regions such as the Middle East or North Africa, presumably as a buffer against potential downturns in bilateral relations? It may also have contributed, at least in part, to a reduced willingness by Chinese SOEs to engage in overseas investment. However, we found no evidence that the tariffs have led to a perceptible shift in China’s investment flows toward BRI countries. Overall, these findings help to illuminate the extent to which policies of “decoupling” may have been effective in inducing shifts in Chinese investors’ investment patterns, at least in the short-run. The presentation will conclude with a discussion of how studies of US–China trade relations fit within the broader international political economy literature on China’s evolving role in the global economy.

Ka Zeng is Distinguished Professor of Political Science and Director of International and Global Studies at the University of Arkansas. Her research focuses on China’s role in the global economy, in particular Chinese trade policy, China’s behavior in global economic governance, and China-related trade dispute dynamics. Professor Zeng is the author or co-author of Trade Threats, Trade Wars (Michigan, 2004), Greening China (Michigan, 2011) and Fragmenting Globalization (Michigan, 2021). She is also the editor or co-editor of China’s Foreign Trade Policy (Routledge, 2007), China and Global Trade Governance (Routledge, 2013), Handbook on the International Political Economy of China (Edward Elgar, 2019), the Research Handbook on Trade Wars (Edward Elgar, 2022), and China and the WTO (Cambridge, 2023). Professor Zeng is currently Senior Research Fellow at the Wong Center for the Study of Multinational Corporations. She is also a fellow in cohort V of the Public Intellectuals Program sponsored by the National Committee on US–China Relations. She is a contributor to journals such as International Studies Quarterly, Review of International Organizations, Review of International Political Economy, World Development, Economics & Politics, Business and Politics, Journal of Experimental Political Science, Journal of World Trade, International Interactions, China Quarterly, Journal of Contemporary China, Social Science Quarterly, Chinese Journal of International Politics, International Relations of the Asia-Pacific, Pacific Affairs, and China & World Economy.

Soo Yeon Kim is Associate Professor at the Department of Political Science, National University of Singapore. She holds a PhD in Political Science from Yale University and a BA in Political Science and International Studies from Yonsei University. Professor Kim's research areas are International Political Economy of Emerging Markets, International Political Economy of Asia, and Trade politics. Her current research focuses on free trade agreements in Asia, rising powers in the global economy, and WTO disputes. She is the author of ‘Power and the Governance of Global Trade’ (2011, Series in Political Economy, Cornell University Press).

This event is hosted on Zoom. Please follow the link to register and attend.