Weicong Qian

This paper quantifies the rerouting of China’s wood and paper sector value added to the United States over 2016–2022, a period spanning the imposition of U.S. Section 301 tariffs and subsequent supply-chain reorganization. Using OECD ICIO, a three-term value-added decomposition separates direct bilateral from indirect trilateral flows through third-country transit economies. A structural decomposition analysis attributes changes in the trilateral channel to four factors: value-added intensity, China’s domestic supply-chain structure, China’s intermediate export orientation toward transit economies, and transit-economy global value chain output combined with U.S. final demand. The trilateral channel grew by 125.5% in wood and 159.4% in paper over the study period, substantially exceeding bilateral channel growth. China’s active reorientation of intermediate exports toward transit economies emerged as the dominant supply-side driver. Vietnam, Mexico, and Canada are identified as the principal conduit economies. Value-added RCA consistently exceeded gross-trade RCA in both sectors; in paper, the gap widened throughout the tariff period, indicating that China’s upstream international competitiveness strengthened despite bilateral trade barriers. These findings demonstrate that bilateral tariffs are materially less effective than gross-trade statistics imply. Value-added tracking should accompany gross-trade monitoring in trade policy assessment.

China’s timber market is very complex and heterogeneous, and is experiencing the impact of the construction of national reserve forests and the downturn in the real estate sector. By setting up a partial equilibrium model which reflects the heterogeneity of China’s wood market, not only difference among domestic timber groups can be identified, but the dissimilarity of imported timber can also be differentiated from the aspects of species and sources. This model is capable of capturing the effects of macroeconomic conditions, forestry sector policies, and trade cost variations on China’s timber market structure. According to simulations of supply shocks, China’s large-diameter log capacity enhancement will have a noticeable crowding-out effect on imported timber, suggesting the diameter of logs is an important factor for market entities to make trade-offs between domestic and imported timber. Amidst both supply and demand shocks, the equilibrium quantity changes in China’s domestic small-diameter logs and imported timber are dominated by demand shocks, whereas the equilibrium quantity change in China’s domestic large-diameter logs is dominated by supply shocks; moreover, only domestic large-diameter logs realize quantity increase in double shocks; this improves China’s domestic timber supply structure, and is a good example of “opportunities in crisis” in the face of negative demand shocks.

China is world renowned for its significant achievements in several fields. China’s economic growth has been prominent, with the country’s GDP ranking second globally. China’s Foreign Direct Investment (FDI) inflows have been significant, with the country now known as the second largest economy in the world. FDI however does have some negative consequences on China’s environment. While attracting FDI promotes economic growth through industrial upgrading, the deleterious impacts of the latter on the environment cannot be ignored. The current study analyses the actual use of FDI and carbon emissions in China from 1997 to 2018. Quantitative analysis was employed to analyze the trends of FDI and carbon emissions in China as a whole and in the respective regions, namely the eastern, central and western regions. Regression analysis was then conducted to analyze the impact of FDI on carbon emissions in China on the national level and regional levels, i.e., in the eastern, central and western regions. The conclusion of this article is that FDI will play a positive role in China’s overall carbon emissions. The study has important implications for policy. We recommend that the corresponding investment policies need to be formulated according to the different levels of economic development among the regions.