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Opinion

Goodbye deleveraging: Fiscal and monetary expansion to support growth in China

China has opted for a renewed fiscal and monetary stimulus to address the risk of the US-led trade war. The dual policies send a clear signal that economic growth is the priority, but such measures do not come without a cost. Deleveraging efforts will have to be put on hold for the time being.

By: Alicia García-Herrero, Gary Ng and Jianwei Xu Topic: Finance & Financial Regulation, Global Economics & Governance Date: August 23, 2018
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Working Paper

European and Chinese trade competition in third markets: the case of Latin America

While Europe continues to hold important trade powers, the rise of China in the global economy has significantly reshaped international trade and competition. In this paper, the authors show that the degree of competition between both powers in Latin America has risen in the past decade due to China's increased trade of high-quality products. They address whether China is an increasingly relevant competitor for Europe in Latin America and in which sectors China-EU competition is fiercer. These findings should be a wake-up call to Europe in its quest to remain competitive at the global level.

By: Alicia García-Herrero, Thibault Marbach and Jianwei Xu Topic: Global Economics & Governance Date: June 7, 2018
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Working Paper

How big is China’s digital economy?

The rise of influential Chinese digital giants, including Baidu, Alibaba, Tencent and Xiaomi has shown the world that China is a global leader in digital innovation and it is not surprising that China has started to influence the global digital market. But is China exploiting its full potential in this area? To answer this question, the authors assess how big China’s digital economy is relative to the rest of its economy, and how China performs compared to the rest of the world.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: May 17, 2018
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Opinion

Why this round of U.S. protectionism is different

Although it is not the first time that the world has been caught in the China-U.S. crossfire, this round of U.S. protectionist moves against China is very different, and more worrisome than past ones. They involve a much larger number of products and in that they also target the global competition for U.S. companies and not only the U.S. market. It is in no way just a poker game launched by the U.S. to reduce its bilateral trade deficit with China, but the herald of an era of China-U.S. strategical competition.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: April 24, 2018
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Policy Contribution

How to handle state-owned enterprises in EU-China investment talks

Chinese state-owned enterprises (SOEs) are one of the main obstacles preventing China and the European Union from agreeing a bilateral investment agreement. Creating barriers to prevent Chinese companies acquiring European assets will not solve the problem, but bringing Chinese corporate governance closer to global market principles will be essential to ensure European and Chinese corporates operate on an equal footing in their cross-border investment decisions.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: June 19, 2017
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Blog Post

Pharmaceutical industry at risk from Brexit

Pharmaceuticals are a hugely important industry for the EU and the UK. The sector creates thousands of jobs, billions of euros in exports, and is Europe’s most research-intense industry. But will Brexit mean for pharma? Border delays, disruption to R&D and regulatory divergence all pose hazards.

By: Jianwei Xu Topic: European Macroeconomics & Governance Date: May 31, 2017
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Blog Post

Is the UK’s role in the European supply chain at risk?

Will the UK’s engagement in European supply chains be at risk once the UK exits the EU?

By: Alicia García-Herrero and Jianwei Xu Topic: European Macroeconomics & Governance, Global Economics & Governance Date: December 20, 2016
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Blog Post

UK-China agreement on trade in services is no substitute for a UK-EU deal

The UK government has high hopes that new trade deals with non-EU states will offer an economic boost after Brexit. But how likely is this to materialise? The authors show that a FTA with China is unlikely to offer much to the UK's prominent services sector. Strong links with the EU will remain vital.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: December 6, 2016
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Blog Post

Trump could give new impetus to EU-China relations

It is too early to say what the Trump administration’s trade policy will look like – but a total cut-off from Asian partners is unlikely. It would harm the US economy, and offer China even more scope to cement its position in Asia. Nevertheless, with TPP and TTIP both looking unlikely, the EU should move fast to build relationships with China and ASEAN countries.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: November 15, 2016
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Policy Contribution

What consequences would a post-Brexit China-UK trade deal have for the EU?

A China-UK free trade agreement has been extensively discussed since the UK’s vote for Brexit. Many supporters of Brexit argue that the UK’s regained flexibility to strike trade deals with other partners, and in particular with China given its economic size, will be a key advantage. This analysis indicates that a China-UK FTA will be neither as easy nor as clearly advantageous as portrayed by Brexit supporters.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: October 7, 2016
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Blog Post

What does China’s ‘belt and road initiative’ mean for EU trade?

Much has been written about the Belt and Road initiative since Xi Jinping made it Beijing’s flagship initiative in September 2013. There are many interpretations of the initiative’s ultimate objectives, but one objective is clear. The belt and road scheme will bring huge improvements in regional and international connectivity through infrastructure upgrades and trade facilitation across a massive geographic area.

By: Alicia García-Herrero and Jianwei Xu Topic: Global Economics & Governance Date: September 20, 2016