Partner Country Choices in China’s Free Trade Agreements

Abstract

The objective of this article is to evaluate the role of the determinants of China’s free trade agreements (FTAs) partner choices. Although we note China’s heterogeneous trade behavior, we assume that there are common traits as key drivers in China’s trade policy. Empirical results based on a logit model show that traditional variables such as distance, a dummy for Asia, and the number of regional trade agreements held by the partner country are statistically significant. Besides, and most importantly, we find that the larger the share of the partner country in China’s commodity imports the higher the probability to hold an FTA with China.

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