Kant the Sublime

The Sublime In Lyotard’s reading Lessons on the Analytic of the Sublime, he explains how critical thought exists within an infinite amount of creativity with no principles but in search of them. Lyotard understands the Kantian sublime as a way to comply with the standards that critically analyze postmodernism using deconstruction. Kant differentiated the sublime between the vastness and greatness and the dynamic sublime. The vastness sublime is so great we can’t just use our senses like we normally do; it requires us to heighten our senses beyond comprehension. The dynamic sublime is the way in which rationalizes things and his perceptions.Lyotard describes the boundlessness of the imagination and reason as a ‘differend’ and this is ‘to be found at the heart of sublime feeling: at the encounter of two absolutes equally present to thought, the absolute whole when it conceives, the absolutely measured when it presents. ’ (Lyotard) Our imagination understands forms and measures while reason understands something without form of an infinite nature of something. There is a separation of imagination and reason and when we use the ‘enigmatic’ power of critical thought we can reflectively judge something.Kant's presentation of the sublime has been taken up by Lyotard and he explores different ways of finding a philosophical understanding of different artworks. Through Longinus and Burke we can explore the pre-modern and modern conceptions of the sublime and through all these critiques we can draw different manifestations of the sublime in art. Kant questions how can someone judge an object before knowing how to properly judge that object and how do they know what proper judging is? Longinus in part of his critique implies that man can go beyond his limitations as a human being by experiencing emotions and language.The art or technical talents was described, as the human while the sublime was something that escaped ou r experience of art. ‘Sublimity consists in a certain excellence and distinction in expression’ (Longinus, pg 100). To understand and have knowledge of the sublime, there needs to be a vague understanding of something that is beyond our experience or senses. He explains that there is more to the human ordinary life because we feel this through the senses, but these senses are an incorrect interpretation caused by a physical perception as opposed to a psychological one.If you think about the sublime, it cannot be pictured or imagined but we have translated and suggested through the arts and poetry. Longinus tells us that nature is the creative and the first principle of the sublime and what follows is a matter luck and good mentors. In Goodbye Lenin, a German film directed by Wolfgang Becker, Lenin tries to hide the unification of Germany during the 1990’s from his mother who was in a coma throughout those months and has to stay in bed. He successfully conned her into thinking nothing had changed by using tricks like old product bottles and filming his own news broadcasts.This film successfully executes the idea of the sublime in what was going on between his mother and the rest of the world. ‘Our faults spring from the same place as our virtues. ’(Longinus)She believed everything around her was real and time had not changed but the people around her were well aware that this was a deception of reality. The way in which Lenin created the same world and reality his mother had always known is overwhelming to the senses and questions what is really for real? Burke believes that the ideas of pain and pleasure cannot be defined, but pleasure of every kind satisfies quickly.He goes on to say that there are two kinds of pleasure: the first that simply is and has no relation and the second that cannot exist without relation. The film has preserved and stopped time that defies nature and in reality cannot be done. The son is so scared an d terrified that his mother will die that he tries to please her by keeping the world exactly the same. This terror is the source of sublime because it creates the most emotion and he imagines the worst. The fear that his mother will die has caused him to be terrified. It explores different areas of the mind by letting her believe this lie.His mother would not survive the fact that everything she has believed in had crumbled while she was asleep and that the world she once knew was suddenly a capitalistic society that now included Burger king, Pepsi and Coca-Cola. Lenin did not want to devastate his mother and cause another heart attack so he had to make everything appear, as it always was wile the outside world was growing and expanding at such an accelerated rate. The kitsch setting of the typical German 1989 apartment filled with yellow flowered wallpaper and dark wood furniture brings calmness to his communist mother.The film captures the nature of humans and their strong social beliefs and how it can affect the human psyche. Burke believes that terror is the source of the sublime and that pain is the more powerful than pleasure. Lyotard believes that pain is not the end point, there is the ‘movement’ of pain to ‘pleasure’ In Joseph Turners Impressionistic painting titled Slave Ship, he has created a seen of vastness that relates to the Kantian sublime but moreover he has demonstrated the use of color and dynamic composition to create a sense of horror.The brushstrokes give a natural look to the painting and the seemingly unintentional brushstrokes create an organized composition. We are aesthetically pleased when we look at the painting because an overwhelming response is experienced when looking at the picture. Burke believed that the Beautiful was very different from the sublime. â€Å"All privation is great because they are all terrible: Vacuity, darkness, solitude, and silence. Low and intermittent sounds and shadows bring a bout feelings of the sublime. Above all, the actions of the mind are affected by the sublime. â€Å"The way in which Turner has used rough brush strokes and lots of contrast between moods and contrasting colors creates the Sublime as opposed to the Beautiful. The use of purple and blue shadows that cast over the foggy night, the bloodline skyline, the flaming enraged sea and the insignificant ship create a sense of horror. The Sublime is experienced in this painting because it is detached from the actual danger of being in an actual situation and rather experienced through the visual arts and poetry in its overwhelming vastness. There is a sense of elation and intimidation when traveling through the painting.Thomas Cole’s Landscape with Tree Trunks create a struggle to be able to understand what is being implied. It becomes uninviting to the viewer as the scary tree trunks in the foreground block our path into the painting and we get further into only for our view to be bloc ked again because of the mountains that come right into the middle part. The painting does not accommodate to human feelings. These are sublime components such as the scary trees, the contrasting light and dynamic sky create frustration in entering the painting make us feel that we are not welcomed and that we are in a wilderness that we cannot control.The overwhelming tree and sky not only creates and unexplained phenomena but also implies that time and power of nature is vast and infinite and these unpredictable forces can in themselves become sublime. The painting composition seems to have been distorted by Cole yet it feels genuine and believable. In the Pianist directed by Roman Polanski we are safe to knowing the reality of the actual circumstance of Jewish victims trapped in a concentration camp but we still enjoy the horrific actions taken against them caused by the overwhelming power of human nature.We are awed, disgusted and in disbelief by the question: â€Å"How can hum an beings do such things? † ‘There is no explanation for the communication of passion, but it is concluded through the experience or premonitions of others. ’(Burke) there is no way to rationalize how the Jews were treated during this time of suffering and we can’t even fathom such events to reoccur, but it still exists today. The pain and suffering that we experience as a witness is subliminal and in cannot be justified. Within the film Szpilman is able to detach from the war and all the pain and suffering he has experienced by playing the piano. When different men have a common faith in the object of admiration we come to the Sublime’ (Longinus). Szpilman creates his own sublime world through the piano. He creates a stimulus of powerful and inspired emotion and he seems to be dignified and elevated when playing the piano, not guilty or ashamed for being a Jew. His talent brings even his worst enemies to respect him and be in completely awestruck by his music breaking all boundaries of human laws and standards and elevating itself to a much higher place that is universal. The unknown and unbound is created in the film when everyone is awestruck and in total admiration of the music.In the end, art has the vastness that allows the mind to be free of obstacles of distraction. Basically, I understand Kant in his way of thinking of art as a way of means to letting the senses experience a feeling far greater than the everyday ordinary life and sublimity only exists in our minds and not in nature, and if we are conscious of this we can become superior to nature within and to nature which does exists without us. Lyotard explains that art should work with no rules and that it therefore cannot be judged and instead be combined and pluralized.Longinus explains that the human is the technical aspect of art while the sublime is the existential part of the human psyche that goes beyond our experience of art. Burke’s modern view of su blimity in art can only be experienced through actual knowledge an actual experience where things are only recreated and reordered. He thinks that death and fear are feelings of the sublime and that what one might expect is very different to what actual really happens and that expectation creates fear which in turn makes us unreasonable and therefore brings about the sublime.

Candide Essay

Candide Essay Voltaire uses literary techniques such as satire and critique to demonstrate the cruelty and folly of humanity. He focuses on serious topics that include sexism, and reduces it to absurdity so that it is comical to the audience. Despite the fact that Voltaire constantly over- exaggerates this subject, he does not trying to reinforce them. Some might say Voltaire portrays women as objects of desire and is capitalizing on the subject but to get his point across using satire, some people will have to get offended.In Candide, Voltaire is critiquing and satirizing sexism. An example of how sexism and rape were satirized and critiqued in chapter 11 on pg 40 â€Å"I was beauty and grace itself, and I was a virgin. I was not so for long; that flower that had been reserved for the handsome Prince of Massa-Carrara was ravished from me by the pirate captain. Indeed My Lady the Princess of Palastrina and I had to be very strong to endure all we underwent until we arrived in Morocc o. But let’s get on; these things are so common that they are not worth speaking of. † Rape is a very sensitive subject.The old woman talked about the incident in a nonchalant tone and said that it was so common that it was not worth talking about. Voltaire did this to satirize what were becoming society’s â€Å"normal† views on such brutal acts. He was letting us know that rape was such a frequent thing in the time period in which he lived, that it was being viewed by society as â€Å"normal â€Å". In order to understand the book properly, it is important to recognize that Voltaire was attempting to portray the problems within society such as sexism, by using satire to help the people this era realize what they were doing was wrong.

Diversity Research Paper Example | Topics and Well Written Essays - 750 words

Diversity - Research Paper Example Managing diversity properly leads to healthy organization of these differences which results in a dynamic milieu where every individual is appreciated and cherished which makes him employ his abilities successfully to accomplish the societal objectives in general and organizational goals in particular. On the other hand, mismanagement of diversity may lead to violence, aggression and revulsion among people. On individual level, diversity helps one to come out of challenging situations by being flexible to troubles. If we talk about business world in United States which is a diverse nation, people of different races and ethnic background are working actively because of the involvement of more women and immigrants. This diversity is necessary for staying in competition with the outer world and ensuring higher productivity. Characteristics that come under the umbrella term of diversity, also sometimes called dimensions of diversity, include age, race, ethnicity, gender, culture, heritage, cognitive approach, beliefs, mental or physical abnormality, socio-economic and educational background, customs and traditions, norms and values, geographical status, religion, art, language, nuptial and family status, political following, sexual orientation, food habits, and etcetera. Every individual is unique but belongs to an identity group at the same time that identifies him. Some of the characteristics are chosen by the individual himself (such as religious beliefs, political affiliation and marital status) while some are given to him by nature or society (such as language, race and ethnicity). Sweetman (2004, p. 2) asserts that diversity can be understood in two dimensions, that is, primary and secondary diversity. He states that primary diversity comprises of those characteristics that an individual cannot alter for himself, such as, â€Å"sex, race or ethnicity, age, physical abilities and qualities, and

Reliability Standards&Regulations Essay Example | Topics and Well Written Essays - 3000 words

Reliability Standards&Regulations - Essay Example t establishes a framework for eco-design requirements for Energy-using-Products which aims to contribute to sustainable development by increasing energy efficiency and protecting the environment while increasing the security of the energy supply. ‘Action should be taken during the design phase of EuP since it appears that the pollution caused during a product’s life cycle is determined at that stage, and most of the costs involved are committed then. If products have a standby mode, this is likely to be affected with a maximum consumption level in this mode. Standby mode is used where the equipment needs to be reactivated remotely or is required to carry out a function as displaying a clock. The maximum power consumption in standby mode depends on the equipment’s function and 1 watt decreasing to 0.5 watts is being proposed for products that use standby as a re-activation function only.. Televisions, microwave ovens, computer monitors, etc will need to be designed to ensure that this is not exceeded. This requirement has far-reaching implications as every function within a product circuitry will need to be reviewed to determine how the power consumption can be reduced. Many products cannot be completely shut down as the off-switch disconnects the input power supply from other parts of the equipment but does not disconnect the power supply from the mains. This is termed â€Å"Off-mode† and it is proposed to restrict power consumption of equipment in this mode initially to 1 watt and, two years later, to 0.5

Valley Forge in Pennsylvania Research Paper Example | Topics and Well Written Essays - 1500 words

Valley Forge in Pennsylvania - Research Paper Example Valley Forge in Pennsylvania was the site of the military camp of the American Continental Army over the winter of 1777–1778 Valley Forge is among the historical places that marked the American Revolution. Moreover, George Washington and his army spent a harsh winter at Valley Forge in the year 1777 -1778. Furthermore, during this period many of the Continental army perished due to starvation, lack of proper clothing to protect them from the cold and infectious diseases (Webstar 1305). Consequently, the Continental army was reduced to almost half its initial population. However, the conditions at the camp improved when congress sent food at the camp and hygiene standards were elevated. Moreover, the soldiers were drilled and when spring arrived, they were ready and eager to face the British army in the battle field. To this end, the continental army eventually fought with the British army even though they were at draw military wise. The Continental Army left the battle field in high spirits and confidence compared to the previous wars. The subsequent sections will elaborate on the reasons as to why General Washington’s Continental army decided to camp at Valley Forge. Moreover, the challenges they encountered during the encampment at Valley Forge will be discussed comprehensively. Furthermore, the drilling of soldiers by Steuben Baron that took place while they were at Valley Forge will be intricately discussed. Finally, the aftermath of the training process will be summarily discussed. Reasons for Camping at Valley Forge In the 18th century of 1777 George Washington, the general of continental army, moved with his army to the south of New Jersey. His objective was to defend Philadelphia city from the advancing forces of William Howe. Consequently, the two armies clashed at Brandywine on the 11th of September (Hickman 1). As a result, Washington’s army was defeated and flee the city. Washington’s army struck again at Germantown on 4th of October in order to regain initiative but was decisively defeated. Subsequently, with the cold weather approaching Washington moved his army to a winter encampment. To this end, he chose Valley Forge, 20 mile s from Northwest city of Philadelphia. Evidently, the site would easily be defendable from surprise attacks. In addition, provision of food from local farmers would be easy. Challenges at Valley Forge In as much as Washington chose the best place for his soldiers to camp, they still encountered serious problems like lack of food and clothing. The soldiers had little to eat apart from fried dough called fire cakes. Furthermore, the soldiers wore tattered cloths and their accommodation was hastily built. The accommodation consisted of canvas walls and dirt floors that were smoky and cold. Furthermore, the cabins were ideal sites for the spreading of diseases that subjected the soldiers to bouts of cold (Miller 9). In addition, the local farmers were hesitant to give their food in exchange to the almost worthless soldiers. On the contrary, the farmers traded their produce with the British; located miles away Philadelphia; for liquid cash. Furthermore, the local farmers even continued t o hoard food as they waited to earn higher profits in the spring season. Consequently, there were prevalent desertions and deaths from diseases and hunger. This led to a reduction of the continental army to almost one-half of the initial size (Miller 9). In addition, Washington was privately annoyed with the lack of strong commitment from his supposedly patriot fighters. Washington’s Leadership Qualities Questioned Washington’s leadership integrity and qualities were cast openly in doubt by his fellow army officers as well as part of the

Politics and Policy Reform In The US Research Paper

Politics and Policy Reform In The US - Research Paper Example During the Golden age, America was faced with the difficulties caused by increased industrialization and urbanization. The challenges prompted the government and political leader to advocate policies to control the emerging big businesses and the welfare of the general public. The federal income tax policy was passed during this time. Moreover, the outcry of the populist reform agenda ensured that senators were directly elected by the people to represent the government of the state in legislation and other national policies. These policies were driven by a progressive movement who late formed a political party in 1912 (Rutgers, 2014). However, the policies have the support from both the Republicans and the Democrats. President Roosevelt and Woodrow Wilson, as well as William Howard, argued that they were Progressives. Policy issues have been emanating from the public and unto the politics. The group of writer’s journalist referred to as the muckrakers were responsible for noticing the failure of the American society in early 1900. They build public awareness of the need for change to avert the emergence of a crisis. For example, The Shame of the Cities written by Steffens’ attached the corruption in the municipal councils. Moreover, History of the Standard Oil Company exposed the malpractices of John Rockefeller’s (Rutgers, 2014). These issues raised by public entities formed the basis of a major political appointee to the office of the President (Rutgers, 2014). The history of health care reform date back to late 1800 until the passage of the recent health Acts by the Senate. It has been over a century for the establishment of a government universal health care (Palmer, 1999). An earlier political leader had argued that they were on the roadmap to success, but they ended up failing during a vote in Congress.  

Write about Maslow Essay Example | Topics and Well Written Essays - 500 words

Write about Maslow - Essay Example He laid out five major classes of human needs; psychological needs, safety and security needs, love and belonging (social) needs, esteem needs and finally self-actualization. Psychological needs primarily entail the basic human needs, for example, water, air, sleep, rest, sex, and food nutrients among other needs. Maslow described these as individual needs. Safety and security needs are those that drive humans to search for safe living circumstances, protection from harm and stability. Love and belonging needs follow after the psychological and safety needs have been taken care of. These needs are characterized by a human feeling of the need for community and relationships with fellow humans. Esteem needs were categorized into two types by Maslow; low and high self-esteem. People with low self-esteem are characterized with need for respect and recognition of others, fame, and attention. Conversely, people with high esteem are characterized by their need for self-respect that is demonstrated by high confidence, independence, and freedom. Finally, Maslow described the highest level of human needs as self-actualization. Humans who have reached this level ar e described as having lower needs to take care about, and thus have all other needs in their life covered. The segment of the human population who are have reached this class are believed to be very small (Armstrong, 2007). After describing the hierarchy of needs, Maslow followed to assert that individuals at a certain level in the hierarchy pyramid are motivated by the unsatisfied needs in their life in order to move to the next level. According to him, the five needs categories can be grouped into two main groups; higher-order needs and the lower-order needs. Through these needs, managers in an organization can understand how to work with their human resources. For example, giving the employees appropriate salaries and

About Capital Asset Pricing Model Essay Example | Topics and Well Written Essays - 2000 words

About Capital Asset Pricing Model - Essay Example CAPM holds that investors are operating in a perfectly capital market and all securities are valued accurately. If we plot the returns on the Security Market Line than none of the returns will be above or below the SML Line. A perfect capital market assumes that information is freely available to all the investors who have homogenous expectations. Secondly, the model assumes that the assets are infinitely divisible. This assumption emphasizes that investors can take any position in investment. For instance, they can buy $1 worth of stock of Intel Corporation. The third assumption about CAPM is that personal taxes are not present which implies that returns generated in the form of dividends or capital gains are not taxed. The fourth assumption is that individual investors do not have power to affect the prices of stocks by the action of their buying and selling rather it is determined in total by their actions. The fifth assumption is that investors make decision based on expected returns or risk, the other factors such as behavioral finance is not accounted to it. The sixth assumption is that there is no restriction on amount of short sales; individuals are free to conduct as many short sales transaction as possible. The seventh and the most stringent assumption is that investors are given the choice to borrow or lend unlimit ed amount of money at the risk free rate. The eighth assumption deals with the homogeneity of the investors’ expectations which mean that all the investors have defined their relative period of investment in exactly the same manner. The final assumption withholds that all the assets are marketable whether they be financial or non-financial such as human capital. CAPM has its roots build on the model of portfolio developed by Markowitz in late 50’s. According to the Markowitz’s model of â€Å"Mean-Variance analysis†, the investors are risk averse and will prefer more return on the same level of

Writing issues Essay Example | Topics and Well Written Essays - 750 words

Writing issues - Essay Example Even if I understand that a written message should be coherent and properly organized, I have realized that my essays always lack this quality. After a careful evaluation of my written works, I found out that I am not well organized, creative and thoughtful (Chandler 26). My efforts to communicate through my writings do not bear fruit since my messages are not arranged in a flowing, interesting and convincing manner. Most of the times, my points are left hanging without being justified. Besides, I find it difficult to use comma. As one of the punctuation marks, comma should always be properly used. It has a lot of uses that vary from time to time and from article to article. For the message to be delivered to the readers, it needs to be appropriately used. However, because I do not know how to use it, my writings have been confusing. At times, they even lose meaning as they are misinterpreted by the readers. In order to appeal to my audience, I need to be more organized in my writings. Meaning, I should be keen on the way I use words and phrases. A part from using conjunctions to make my work coherent, I need to properly structure my writings. They should always start from the introduction and end with the conclusion (Rogers 40). If this is done, the writings will be readable and understandable to anyone who gets an opportunity to access them. Besides, I need to learn to be thoughtful, imaginative and creative. Writing should not just be done for the sake of it. It should be a means of communicating to others. However, if it bores, no one would waste their time reading them. In this regard, I will have to ensure that I improve on these areas. They can make my writings to get the approval of the readers. Otherwise, I will be writing for myself (Boltz 722). On the other hand, I need to look for ways through which I can improve the use of comma. First, I should spend adequate time at the Writing Centre. Here, I

Abstract Expressionism - Control VS Chance Research Paper

Abstract Expressionism - Control VS Chance - Research Paper Example The research paper "Abstract Expressionism - Control VS Chance" investigates abstract expressionism. It challenges the controlled aspects in art and gives us the freedom to express our own idea of what art is through expression. If you take your time to look at a work of art, it should take you through a process, emotions, and should tell a story, which is what Abstract Expressionism does. From brush strokes, to color schemes, to texture, to geometric and organic shape and line, Abstract Expressionism provides an experience that is reserved for those who are willing to experience a journey of something different and not immediate familiar. Artists such as Hans Hofmann, Jackson Polluck, Franz Kline, Gerhard Richter, and Norman Lewis have been leaders in abstract expressionism through painting and I personally have been inspired through their works. My paintings, mixed media art, and photography are all influenced by Abstract Expressionism. While analyzing the works of these artists, w e will discuss the comparison of control versus chance in art and the need for Abstract Expressionism in the contemporary world of art. It emerged soon after the Second World War thereby developing a new trend in painting among other types of arts. Different artists that shared the school of thought appreciated different features of art as they sought the freedom to express their creativity and artistic instinct in the development of art. Abstract expressionism therefore relies on the creativity, energy and action.

Chemiluminescence of Luminol Essay Example for Free

Chemiluminescence of Luminol Essay Introduction In this experiment, luminol was mixed with hydrogen peroxide (an oxidising agent) resulting in chemiluminescence. The experimentis designed to see how the duration of luminescence is affected by varying temperatures. It has been made to be deliberately inaccurate, so another objective would be to see whether subjective observations can be improved by repetition and averaging. Chemiluminescence is the production of light from a release of energy in a chemical reaction without the aid of heat. The light produced is due to electrons being given an excess of energy and this energy being released as the electrons revert to their ground state, a luminescent light being given off as a result. An important use of this reaction is in forensic science where luminol and hydrogen peroxide are used to highlight samples of blood at a crime scene. The two chemicals react readily due to the iron present in haemoglobin, giving off a luminescent glow as a result. Chemiluminescence occurs even in living organisms where it is termed bioluminescence. Using fireflies as an example, a reaction where luciferin combines with adenosine tri-phosphate (ATP) and reacts with the enzyme luciferase. The action of the enzyme acting on luciferase simulates something similar to luminol and a peroxide being catalysed by a transition metal catalyst, providing electrons with enough energy to reach a higher energy level which then gives off light as they relax back to their ground state. Reaction pathway of luminol 2H2O22H2O + O2(g) Decomposition of Hydrogen Peroxide In this experiment we used luminol and hydrogen peroxide solution. When the two react, a dianion is from the peroxide reacting with the luminol. As hydrogen peroxide reacts, oxygen is evolved which then reacts with the dianion to produce an unstable peroxide; the instability of the peroxide causes it to break down immediately and lose nitrogen, producing 3-aminopthalate. (above) Experimental A set of five test tubes were prepared and labelled with a letter(A-E) and their temperatures; 220C (room temperature which varied between groups), 250C, 350C, 60C and 400C. 250C, 350C and 400C were conducted in water baths whereas 60C used an ice bath.

Stewardship versus economic decision making in financial reporting

Stewardship versus economic decision making in financial reporting The main objective of financial reporting according to the IASBs Preparation and Presentation of Financial Statements framework is that of providing adequate information in order to enable shareholders conduct economic decision making. This brought the debate of whether such objective neglected the importance of the stewardship assessment by the part of shareholders. In the past decade the IASB and the US FASB have been working on a joint project to develop a conceptual framework for financial reporting. Such conceptual framework has the aim of providing a base for developing harmonised, future accounting standards. In 2008, the boards issued an exposure draft of chapter one and chapter two of the conceptual framework with chapter one tackling the objectives of financial reporting. In the exposure draft that has been lately issued by the two boards, it was identified that the objective of financial reporting should be that of catering for all the decisions that capital providers make, including both resource allocation decisions and decisions made to protect and enhance their investments. Furthermore on the underlying exposure draft there is stated that information about the stewardship of an entitys economic resources should be considered as decision-useful information. Hence in this exposure draft it is clear that the two boards shifted from focusing solely on economic decision making, to general decision making, with stewardship being included in such broader definition. Although this move to focus on decision usefulness rather than specifically on economic decision making was a means to subsume stewardship in the objective of financial reporting, authors such as Andrew Lennard still argue that stewardship and decision usefulness should be recognised as separate objectives. à ¢Ã¢â€š ¬Ã‚ ¦stewardship contributes an important dimension to financial reporting, which should be reflected by specific acknowledgement in the objectives of financial reporting.  [1]   The majority of the authors who recognise stewardship as a fundamental objective in financial reporting, claim that financial statements should be prepared on the basis of historical costs. This ensures in providing a clear, factual account of the transactions that occurred during the year, over which management had control. Thus reporting on historical cost can aid shareholders accomplish their stewardship assessment needs better. On the other hand, to cater for decision usefulness, especially in terms of economic decision making, financial reporting would focus more on the forecasting of future cash flows. Such objective would be better addressed with valuations based on market values, since they better reflect the timing and certainty of future cash flows. This is leading to the emergence of valuation techniques based on current values, such as fair value. The adoption of fair value accounting is perhaps one of the most controversial issues currently being faced by the accountancy world. Both the IASB and the FASB have been working on this issue for the last couple years. Traditionally, financial reporting has been exclusively based on historical costs. The use of current values, such as fair value reporting emerged relatively recently, and was applied to only few selected areas. One of the areas where fair value had a major influence is in the measurement of financial instrument. Using market values to value Financial Instruments is deemed to be reliable (since markets in these items are well developed) and relevant (because the values of financial instruments can experience large fluctuations, thus historical costs depicts a very poor picture of current values). However, in the nearby future, fair value measurement is likely to be extended to other assets, especially in the light of the fact of the IASBs and FASBs perceived preferenc e for fair value measurement even where the market is not well developed. The IASB believes that fair value measurement under IFRS and GAAP is already consistent. Also, the IASB and the FASB will continue to work together to ensure that applying fair value in an inactive market is accounted for consistently  [2]  . Shareholders are divided into two main categories, private individuals and institutional investors. Although financial reporting is designed to cater for the needs of capital providers, due to the lack of knowledge commonly found within private individual shareholders, concerns may arise on what such private individual shareholders identify as useful, for their decision making. Need for the study: The dissertations objective is to identify the current needs of private shareholders and what they identify as valuable information. The dissertation shall then examine to what extent the focus on decision usefulness and the forecasting of future cash flows through fair value accounting shall aid private shareholders in satisfying their requirements. Research Methodology: The dissertation will be of a qualitative nature. The aim of such dissertation is to achieve a deep understanding of what local private shareholders value as relevant information, and to examine whether the emerging concept of fair value accounting will be providing such users more relevant accounting information. The aim of the study is not to generalise findings but to obtain rich description on the underlying topic. The method being taken into consideration to gather the qualitative data is the setting up of focus groups with shareholders. Such group discussions provide direct evidence about similarities and differences in participants opinions. Participants are not required to answer for every question enabling them to build on one anothers response. Furthermore by acting as a moderator I can ensure that the discussion is always kept on track. Finally, focus groups can be considered as a more plausible solution when compared to open ended interviews with shareholders. The response rate of shareholders to a focus group is likely to be greater when compared to a personal one on one interview, since the latter is perceived as more intrusive. The main limitation of using focus groups is perhaps the risk that people influence each others response. As a result the response of participants can be different than the response that would have been generated from a private one on one interview. Shareholders from two local, listed companies are going to be considered as the population sample. These companies are Bank of Valletta and HSBC. The choice fell on these companies because due to the recent changes to IAS 39 and IFRS 7, fair value measurement had a considerable impact on the banking sector. Thereby, due to such fact shareholders can be even more concerned and affected with the underlying subject. Two focus groups are planned to be set, one with BOV shareholders and one with HSBC shareholders, with groups ranging from six to twelve members. Shareholders list can be obtained from the Malta Financial Services Authority. The sampled population will exclude overseas shareholders, trusts and investment companies, thus focusing solely on local private shareholders. Chapters Overview: Introduction: firstly the stewardship versus economic decision making debate will be tackled, and its effects on valuation on financial reporting will be analysed. The dissertation shall then focus on the emergence of fair value as a measurement tool and its prospective usage. Furthermore fair value will be compared and contrasted with cost based valuation. The introduction will also include an examination of how each valuation method caters for the individual private shareholders requirements. Literature Review: literature review can be focused on two aspects being the debate of fair value measurement versus cost based measurement, and the debate of whether private shareholders use accounting information mostly for economic decision making, or to assess stewardship. Research Methodology: in this section I shall describe how the results were achieved, explaining how the data was collected and analyzed. This section shall contain the weaknesses and limitations of the research methods and methodology used. In the methodology I shall also include any problems that I anticipated and explain any steps taken to prevent them from occurring. Findings: this part of dissertation will contain the information generated from the focus groups. Results will be presented, interpreted and discussed in this section. Conclusion: this part will provide concluding insights on the research, and recommendations of other research questions that can be tackled to improve the research on the area. The main questions to be answered in this section are: what has been learnt from the results? How can this knowledge be used? What are the shortcomings of the research? Bibliography: Accounting Standards Board. (2007). STEWARDSHIP/ACCOUNTABILITY AS AN OBJECTIVE OF FINANCIAL REPORTING A comment on the IASB/FASB Conceptual Framework Project. UK: Accounting Standards Board. Alan Bryman, E. B. (2007). Business Research Methods 2 edition. UK: Oxford University Press. Doron Nissim, S. P. (2007). ON THE APPLICATION OF FAIR VALUE ACCOUNTING. Columbia Univesity. Lennard, A. (2008). Stewardship and the objectives of financial statements: a comment on IASBs Preliminary Views on an improved Conceptual Framework for Financial Reporting. UK: Accounting Standards Board. RONEN, J. (2008). To Fair Value or Not to Fair Value: A Broader Perspective. Accounting Foundation , Sydney. Schmidt, S. (2004). Fair Value Accounting. US: Governors of Federal Reserve System. Whittington, G. (2008). Fair Value and the IASB/FASB Conceptual Framework Project: An Alternative View . Cambridge: University of Cambridge.

Retail Merchandising And In Store Operations

Retail Merchandising And In Store Operations Introduction Many companies have acknowledged that improving their store layout; they will be able to increase their number of sales per square foot. Even the architecture of a store can lead to an increase in sales. Within the store layout marketing strategy, there are a number of different aspects to take into consideration such as architecture, store ambiance and location, visual merchandising and most importantly the store layout. Visual merchandising can be anything from the store window display to store ambience, all of these artefacts are put into action when companies wish to increase their sales per square foot. There are both positive and negative ways in which a change to a store layout can increase the sales per square foot for a company, as because of this numerous actions must be considered before a company drastically changes their layout. Executive Summary The purpose of this report was to research how store layouts and improvements to a store can increase the sales per square foot. â€Å"Store layout and visual merchandising are two important factors that add to the distinctiveness of a store. The interior design of the store plays a more vital role† as show on Indian MBA (2008). Also mentioned on Indian MBA (2008) â€Å"Space is always an extremely expensive and scarce resource. Retailers try to maximize the return on sales per square foot.† This is the best way to describe why retailers see the interior of their store as the best way in which they can increase these sales per square foot. There are various types of store layouts which retailers would consider to increase their sales per square foot. This report will analyse and explore how retail design, store layout and visual merchandising can help increase sales per square foot, by the use of research into trade publications as well as newspapers and other sources. Also in this report, examples of stores that have successfully managed to increase their sales per square foot will be mentioned. Findings Retail architecture is a vital mechanism in the function of market intermediation. Retail architecture is defined as those market spaces that affect the relationship between supply and demand. Architecture can directly illustrate some stores social significations of retail relationships; its brutality as well as its warmth, and its social class. For example Harrods has a high level of retail architecture, as it is not only a tourist attraction due to its external historical architecture but it also denotes peoples social class as people who are of a higher social status or social class would be most likely to shop at Harrods. Liberty the British department store has a high level of appreciation for its buildings history, as Creative Director Tamara Salman of clothing brand Liberty of London adds to her collection the stores extraordinary 130 year heritage. Liberty store is able to build upon their heritage to ensure that they increase their sales per square foot figure. With being such a strong and historical store it is hard for many new and upcoming companies to be able to have such a strong fall back for increasing sales. However, retail store layouts are important determinants of customer behaviour. UK fashion retailers are able to gather critical information regarding their target consumers which in turn enable them to create interiors which successful attract these groups. In the context of the store layout, time-poor and highly mobile consumers require different spaces than shoppers who leisurely shop at discounts, and selectively during sales periods at various stages in the business cycle. Also, gender differences in shopping can justify quite specific changes to fashion store formats and space allocation. Store layouts and the merchandise offered are matched to the targeted consumers to the extent that customers ‘buy into branding statements. It is important that the retailer gains a positive reaction to the new layout of its merchandise within the store as a negative reaction would then cause sales to decrease. To ensure that a company is using the right type of store layout, the retailer would look into their own store layout analysis. Within a store layout analysis, careful consideration is given to the products being sold and their location; this can also be seen as basic psychology used to entice customers to spend more money usually through impulse buying. Retailers can also increase their competitiveness by closely targeting and fulfilling their customers needs. Tauber (1972) hypothesised three reasons for shopping; personal motives, social motives and impulse buying. Creating consumer satisfaction involves delivering quality products that meet their needs and is core in highly competitive environments. The allocation of space within any store can be on the basis of many factors such as historical sales, daily average sales, profits, margins, industry averages and strategic reasons. A store layout must also include space for essential functions such as inventory, customer service desks and changing rooms. For any retailer to have success in increasing their sales per square foot, the must look at a number of aspects such as their fixtures and fittings, colours of the store interior, lighting, and window displays. Store interiors are designed in a way which influences consumer behaviour which is referred to as Visual Merchandising. Company visual merchandisers control the use of equipment, displays, colours, illuminations, music, ambience and floor management within a store. Music: Music can be used to increase sales per square feet, as music sets the tone of the environment within the store and as peoples moods change throughout the course of the day it is essential to also have music which reflects the mood of the customers. Music which is played during the morning should be high energy based as customers have lots of energy and this would mean that a company would have more people coming in and purchasing items during the morning hours. Music during the afternoon should be more mellow as peoples energy levels are decreasing and they are more reluctant to browse through the store looking for their wanted items compared to those in the morning. Similarly to the morning during early evening hours, customers respond better to slightly more up-tempo songs. Retailers should also take into consideration their target consumers when deciding on what type of music they should have playing in their stores. Colour: Colour is another factor that can entice customers into shopping at a specific store, colour is immediate, emotional and memorable. Colours bring out emotions and feelings automatically to customers, therefore it is essential to retailers to get the correct colour balance for their store. The colour blue is seen as a natural element, but it is also connected with trust and stability, therefore retailer who use blue within their interior design in informing customers that they are trustworthy and understandable as well as confident. The colour green is found to be a successful colour when linked to hygiene and beauty, which is the main colour for the company Body Shop. All Body Shop fronts are green and have some form of a green colour within their interior. The Body Shop also consists of natural colours and woods making customers feel a sense of freshness, healthiness, youthfulness and the colour green can also be linked to money. Colours within the Purple category can be linked to the emotion or sense of royalty, luxury and spiritual. Again the store Liberty link purple into their company in the use of their website, correspondence as well as their company gift bags, this enables their customers to leave the store with a sense of luxury which also makes them more likely to come and purchase from Liberty again. Fixtures and Fittings: Within any retail store, the fixtures and fittings are another key element to increasing sales per square foot. For shelves, eye level and slightly above is the best position to sell garments from, as colour of the garment can catch customers eyes making them stop to look at the item. Displays should be kept simple, and have a theme to them. It is also effective to include the products in use or as a collection which can be paired up e.g. in Primark or Marks and Spencers, many items of clothing a paired together such as shirts are sectioned with trousers, skirts and blazers as this enables the consumer to see what the item will look like paired with something else, this also shows that they do not have far to go to obtain a matching jacket for a work skirt. Also in Primark, shoes are usually opposite the formal or business wear but situated closely to accessories such as handbags and purses; again this is done so that the consumer doesnt have very far to travel in order to complete the outfit they required. It is also important to have impulse items which are usually located close to the tills so that customers are more likely to purchase these along with their inital shopping, this could be anything from socks to lip glosses. Window display: Bright and colourful window displays can make the company store window stand out from other competitors, however the use of too many colours can make the store look cheap and put customers off going into the store. The lighting used within a store front should be bright as this makes it more attractive and appealing to passing customers. A store window is an ideal way of attracting new and existing customers as you can use a store window to build the company image, showcase new arrivals as well as products that are in high demand. Window displays should be changed frequently to keep target customers and new customers interested in the company, and to make them stop and purchase something. The department store Selfridges is the most competent store for their window displays as each window can tell a different story based on whatever theme maybe inspirational at the time. As Selfridges window display tells a store more and more customers are intrigued to know what it is about and where they can find the items shown in the window, this is how Selfridges gains an increase in their sales per square foot. Lighting: Proper lighting can increase sales by up to 20%, therefore all retailers will benefit from using the best bulbs possible when updating their store layout. In 2010, John Lewis changed their store lighting as the dim lighting which was previously in store caused consumers to be less likely to spend money as dim lighting can cause customers to feel tired. Retailers should make use of spot lights, as these can be used to highlight key areas or even key products which may be commission based, therefore the more sold, the more money the company makes. Conclusion: As mentioned throughout this report, companies need to selectively decide which options will be best for them to be able to increase the sales per square feet as the initial reaction of the customers to a new store layout is the deciding factor as to whether the company will target more customers or lose customers as a result. Companies should pay close attention to the information they already poses about their customers and use this to their advantage, they should also be aware of their competitors so that they are able to always be one step ahead, boosting sales as they go.

Free Macbeth Essay: Macduff as Hero :: GCSE Coursework Macbeth Essays

Macduff – The Hero in Macbeth  Ã‚   Some people are just meant to be heroes. In this wonderful play by Shakespeare Macduff is a good choice and born to be a hero. Throughout Macbeth there are several examples of Macduffs heroism and bravery. Macduff is a loving, caring man of action, Thane of Fife and a Scottish nobleman hostile to Macbeth's kingship. When he leaves his loving family to flee to England to join Malcolm, Macbeth has Macduff's wife and children murdered. At the end of the play, Macduff (who was born through a caesarian section) kills Macbeth bringing prosperity back to Scotland, and proving the truth in the witches prophecy that "no man of woman born" can harm Macbeth and his true heroism. Macduff ends up putting his country ahead of his family, whom he loves dearly when he quickly decides to flee to England. Macduff made the hardest decision of his life and a decision he had to make to bring prosperity back to Scotland. Lady Macduff questions her husband’s wisdom as she sees no reason for him to leave his family and home behind. "Wisdom! To leave his wife, to leave his babes, his mansion and his titles in a place from where himself does fly?" Lady Macduff yells in question. Although fleeing to England to Malcom’s side was a very questionable decision, there was no doubt in Macduff’s mind of what had to be done. Madduff is a man of action rather than a man of words. There are several occasions where Macduff acts on his thoughts rather than sitting down and talking about it showing his courage, passion and bravery. Macduff left his family whom he loves dearly, and fled without words to England. "My voice is in my sword, thou bloodier villain than terms can give thee out!," Macduff yells his savage rage, and beheads Macbeth in the final wager of battle. Macduff is truly the hero in this magnificent piece by Shakespeare as he takes the head of Macbeth for Scotland.

John Stuart Mill Essay -- essays research papers

Who is John Stuart Mill? John Stuart Mill was born on May 20, 1806, in London, England. He was mostly known for his radical views. For example, he preached sexual equality, divorce, universal suffrage, free speech, and proportional representation. He had many works of writings such as Principles of Political Economy, On Liberty, The Subjections of Women, and the Three Essays of Religion: Nature, the Utility of Religion, and Theism.   Ã‚  Ã‚  Ã‚  Ã‚  John Mill was the eldest son of James Mill who was a philosopher, economist and a senior official in the East India Company. James educated John when he was young. His father taught him discipline, Greek at the age of three, history, languages, calculus, logic, political economy, geography, psychology, and rhetoric. At the age of twelve he was a competent logician and by the age of sixteen a well trained economist. (http://www.utilitarianism.com/jsmill.htm) His father believed that teaching children while they were young would have an ever lasting effect on them. The purpose of this push of education at a young age is because James thought that teaching John would have the chance of becoming a prophet of the utilitarian gospel. John had to eventually take his learning from his father and teach his eight younger brother and sisters the same material.   Ã‚  Ã‚  Ã‚  Ã‚  Around the age of sixteen, John created a Utilitarian Society, which had the goal of bringing happiness to the greatest number of people, where he was one of a â€Å"small knot of young men† who practiced his father’s political and philosophical views. (http://www.utm.edu/research/iep/m/milljs.htm) At the age of twenty-one he suffered a mental breakdown, which resulted from severe strain from his earlier years. In his own autobiography, which was later published after his death, he wrote, that he was in a â€Å"dull state of nerves†; and that he had lost his charm. He said he had â€Å"no delight in virtue, or the general good, but also just as little in anything else.† After several months he realized that his emotions where not dried up and â€Å"the cloud gradually drew off.† In 1823 John took a clerkship position in the Examiner’s Office at the East India Company. Later he eventually headed that department. Harriet Tay lor who was a close friend with John co-wrote several pieces of work with him. They met in 1830 and she was the mother of t... ...em. This is what he is trying to bring up to action of treating women with respect and the same as men treat other men. He concludes chapter one by stating, â€Å"But, in that case, all that has been done in the modern world to relate that chain on the minds of women, has been a mistake. They never should have been allowed to receive a literary education. Women who read, much more women who write, are, in the existing constitution of things, a contradiction and a disturbing element: and it was wrong to bring women up with any acquirements but those of an odalisque, or of a domestic servant.† (The Longman Anthology, pg. 527) In conclusion, He was mostly known for his radical views. Principles of Political Economy, On Liberty, The Subjections of Women, and the Three Essays of Religion: Nature, the Utility of Religion, and Theism, where just some of the many works that he published to show the world that everything is not always perfect and intact. He showed that you could express your mind and that this is the new era of thinking. His writings on women’s rights to the economy where way ahead of his time. It is true that John Stuart Mill’s is not known well enough today as he should be.

Techniques for Authentic Assessment :: Learning Education Educational Essays

Techniques for Authentic Assessment Learning is . . . a dynamic process in which learners actively construct knowledge . . . the acquisition and organization of information into a series of increasingly complex understandings . . . influenced by context (Holt 1992). Educators who view learning in this way realize that quantitative methods of evaluating learners do not "measure up." Authentic forms of assessment present a more qualitative and valid alternative. Authentic assessments (AAs) incorporate a wide variety of techniques "designed to correspond as closely as possible to `real world' student experiences" (Custer 1994, p. 66). They are compatible with adult, career, and vocational education. After all, apprenticeship is a time-honored form of authentic learning: skills taught in context. "High-performance workplaces" demand critical thinking, self-directed learning, and individual responsibility for career development (Borthwick 1995; Jones 1994)-which the process of AA can develop. This Practice Application Brief describes types of authentic assessment, explains some of the advantages and challenges they present, and highlights some best practices in design and implementation, with specific examples from adult, career, and vocational education. What Are AAs? Assessments are authentic when they have meaning in themselves-when the learning they measure has value beyond the classroom and is meaningful to the learner. AAs address the skills and abilities needed to perform actual tasks. The following are some tools used in authentic assessment (Custer 1994; Lazar and Bean 1991; Reif 1995; Rudner and Boston 1994): checklists (of learner goals, writing/reading progress, writing/reading fluency, learning contracts, etc.); simulations; essays and other writing samples; demonstrations or performances; intake and progress interviews; oral presentations; informal and formal observations by instructors, peers, and others; self-assessments; and constructed-response questions. Students might be asked to evaluate case studies, write definitions and defend them orally, perform role plays, or have oral readings recorded on tape. They might collect writing folders that include drafts and revisions showing changes in spelling and mechanics, revision strateg ies, and their history as a writer. Perhaps the most widely used technique is portfolio assessment. Portfolios are a collection of learner work over time. They may include research papers, book reports, journals, logs, photographs, drawings, video and audiotapes, abstracts of readings, group projects, software, slides, test results; in fact, many of the assessment tools listed earlier could have a place in a portfolio. However, the hallmark of a portfolio used for assessment is that the contents are selected by the learner (Hayes et al.

Foreign Trade of China

Foreign Trade of China K. C. Fung University of California, Santa Cruz Hitomi Iizaka University of California, Santa Cruz Sarah Tong University of Hong Kong June 2002 Paper prepared for an international conference on â€Å"China’s Economy in the 21st Century†, to be held on June 24-25, 2002, Hong Kong. We would like to thank Alan Siu and Richard Wong for their encouragement. 1. Introduction On December 11, 2001, China officially joined the World Trade Organization (WTO) and became its 143rd member. China’s presence in the world economy will continue to grow and deepen. The foreign trade sector plays an important and ultifaceted role in China’s economic development. At the same time, China’s expanded role in the world economy is beneficial to all its trading partners. Regions that trade with China benefit from cheaper and more varieties of imported consumer goods, raw materials and intermediate products. China is also a large and growing export marke t. While the entry of any major trading nation in the global trading system can create a process of adjustment, the outcome is fundamentally a win-win situation. In this paper we would like to provide a survey of the various institutions, laws and characteristics of China’s trade.Among some of the findings, we can highlight the following: †¢ †¢ †¢ In 2001, total trade to gross domestic product (GDP) ratio in China is 44% In 2001, 47% of Chinese trade is processed trade1 In 2001, 51% of Chinese trade is conducted by foreign firms in China2 1 We define processed trade to include both trade due to processing and assembly and trade due to processing with imported materials. Processing and assembly refers to the type of inward processing in which foreign suppliers provide raw materials, parts or components under a contractual arrangement for the subsequent re-exportation of the processed products.Both the imported inputs and the finished outputs remain property of t he foreign supplier. Processing with imported materials refers to the type of inward processing other than â€Å"processing and assembly†. For details, see China’s Customs Statistics Monthly, December, 2001. †¢ †¢ In 2001, 36% of Chinese exports originate from Guangdong province In 2001, 39% of China’s exports go through Hong Kong to be re-exported elsewhere3 The organization of this paper is as follows: in the next section, we provide a general overview of the past institutions and rules governing trade in China.We will also examine the evolution of China’s general trade pattern over time. In section 3, we will study China’s processed trade and trade conducted by foreign firms. In section 4, we study China's trade by province and by regions. In section 5, we focus on China's trade with the world major regions, including Asia, Europe, North America, Latin America and Africa. In section 6, we will examine China's trade with various major t rading partners. In section 7, we discuss China's new trade regime with its entry to the World Trade Organization (WTO).In section 8, we analyze in greater details the trade relationships between China and the United States, China and Japan, China and the European Union, and between China and the Association of Southeast Asian Nations (ASEAN). In section 9, we conclude. 2. Evolution of China’s Trade Regime Since the economic reforms and open door policy started in 1978, there has been a strikingly sharp rise in China’s exports and imports. As is shown in Table 1, between 1978 and 2001, the total value of China’s trade grew at an average annual rate of 15. 5% and export and imports grew at 16. % and 15. 6% per annum, respectively. 2 Foreign firms include Sino-foreign contractual joint venture, Sino-foreign equity joint venture and foreign-owned enterprises. A substantial portion of trade conducted by foreign firms is processed trade. 3 This is obtained by dividin g the value of Hong Kong re-exports that originate from China by the total Chinese exports to the world. In the pre-reform era, China was an insignificant participant in international trade. China’s foreign trade system was a complete state monopoly controlled by the Ministry of Foreign Trade (MOFT).Trade was conducted by product-specific national foreign trade corporations (FTCs) operating under a near total mandatory trade plan. In 1977, China’s total trade volume was $14. 8 billion, which accounted for only 0. 6% of world trade. A series of measure was introduced to promote exports since 1979. They are meant to decentralize foreign trade administration, to reduce the scope of mandatory planning, and to introduce the market mechanism. Compared to the export system, the import system remained relatively unreformed in the 1980s.In addition to import licensing and high tariffs on protected products, almost all import users were subject to a series of administrative meas ure and complicated approval procedure. By the early 1990s, the significance of China’s role in the international economy was transformed. In 1992, its trade volume accounted for 2. 2% of world trade. China’s trade regime has become more transparent with its desire to join the WTO. The control over imports was more relaxed with a reduction on a large number of tariff rates.In 1994, the foreign exchange regime was reformed by abolishing the dual exchange rate system, which was introduced in 1986 with the establishment of the foreign exchange adjustment centers (FEACs), or swap centers. The new regime allowed domestic firms to buy and sell foreign currencies at the official exchange rate. In 1996, the new foreign exchange regime became applicable to foreign enterprises as well. During the years 1997-1998, the adverse effects of the Asia financial crisis became more apparent, and China’s foreign trade was met with unprecedented difficulties. China’s total tr ade went down by 0. 4% and its imports decreased by 1. %, although its exports maintain a small growth rate of 0. 5%. But China’s trade growth accelerated since 1999 with the recovery in the Asian economies. From 1999 to 2000, total trade grew at an annualized rate of 31. 2%. The export value reached $249. 2 billion, up 27. 8% and the import value reached $225. 1 billion, up 35. 8%. In 2001, there is a modest increase in trading activities, with total trade rising by 7. 8%. Equally remarkable are the changes in the commodity composition of China’s exports and imports. Table 2a shows China’s annual export volumes of primary goods and manufactured goods over time.In 1980, primary goods accounted for 50. 3% of China’s exports and manufactured goods accounted for 49. 7%. Although the share of primary good declines slightly during the first half of 1980’s, it remains at 50. 6% in 1985. Since then, exports of manufactured goods have grown at a much faste r rate than exports of primary goods. As a result, the share of manufactured goods increased to 90. 1%, and that of primary good decreased to 9. 9% by 2001. Also shown in those tables are five subgroups for manufactured goods and primary goods. China’s export was highly dependent on its exports of coal, petroleum, and petroleum products until mid-80s.The large export volume of petroleum was also supported by a sharp rise in oil prices during the period. In 1985, the share of mineral fuels is 26. 1%. In 1986, the sudden decline in the share of primary goods in total exports occurs, which is largely associated with the decline in the export volume of mineral fuels. The price reforms coupled with the declined world petroleum price are attributable to the decline. Domestic agriculture production expanded during the 1980’s in response to the higher prices through the price reforms and more opportunities given to the producers to market their products.Although the share of f ood and live animals in total exports has declined over time, China has become a net exporter of such products since 1984. Turning to the manufactured goods, the large increase in the share of the manufactured goods in the total exports since mid-80s is largely accounted for by the increase in the export in the textile category and the miscellaneous products category. These two groups include labor-intensive products such as textiles, apparel, footwear, and toys and sporting goods. During the 1990s, the category that exhibited the most significant surge in exports is machinery and transport equipment.Its share expanded from 9. 0% in 1990 to 35. 7 % in 2001. The change in the commodity composition in China’s imports can be seen in Table 2b. The share of primary goods in total exports fell from 34. 8% in 1980 to 18. 8% in 2001. The decline in the share reflects large decrease in imports of food and live animals. Its share reached the highest at 21. 8% in 1982 has declined over the past 20 years to 2. 0% in 2001. The increased production of agricultural production due to domestic economic reforms enable China to reduce the amount of its agricultural imports.The share of mineral fuels in imports on the other hand, has been steadily increasing during the period. The rapid economic growth that China has experienced has led to a shortage of those products domestically. China has been a net importer of mineral fuels for the past six consecutive years. The share of manufactured products in total imports rose from 65. 2% in 1980 to 81. 2% in 2001. This is largely attributed to sharply rising imports of machinery and transportation equipment. There are two major factors that led to the increase of importing machinery and transportation equipment.First, the imported machinery and transportation equipment embodied a higher level of technology than those produced domestically. Second, since China initiated the open-door policy, throughout the 1980s and the 1990s, the government promoted to open the economy to foreign investors by adopting a series of reforms and new regulations. Those include establishing Special Economic Zones, Open Coastal Cities, opening up of new sectors, various preferential policies for foreign multinationals such as tax concession, import tariff exemption, and so on.These efforts resulted in creating a more favorable investment environment for foreign multinationals, which led to a considerable rise in foreign direct investment. Among other activities, these foreign firms engage in processing trade. China has become an important link in the global supply chain for multinationals. In addition, China has also a large and growing market. The increased share of imports of machinery and electronics products reflects the increased use of global outsourcing as well as the growth of China’s domestic market. 3.China’s Processing Trade and Trade by Foreign Invested Firms China established the legal framework for proc essing and assembly arrangements in 1979. Since then, China has built up considerable strengths in assembling and processing of industrial parts and components. It covers a wide range of industries such as electric machinery, automobile, aerospace, and shipbuilding. Table 3a and Table 3b demonstrate the amount of processing exports and imports and the importance of stateowned enterprises (SOEs) and foreign-invested enterprises (FIEs) in such forms of trade for 1995-2001.Throughout the period from 1995 to 2001, the shares of these two types of processing exports exceed more than half of China’s total exports. In 2001, processing exports account for 55. 4% of the total exports. As is seen in Table 3a, process & assembling was dominated by SOEs in 1995. However, the trend has been changing. The share of SOEs in process & assembling has been steadily declining over the years from 84% in 1995 to 62% in 2001. The other type of trade, process with imported materials was largely cond ucted by FIEs and their shares have been gradually increasing from 81% in 1995 to 88% in 2001.In China’s imports (see Table 3b), processing trade is relatively small compared to exports. After it peaked at 49% in 1997, processed imports decline to 39% in 2001. The decreasing importance of SOEs can be seen in China’s imports as well. Shares by SOEs decreased from 81% in 1995 to 58% in 2001 for process & assembling, and from 18% to 7% for process with imported materials. The decreased role for SOEs in processing trade may reflect the inefficiency in conducting their business. Since 1997, the Chinese government decided to implement the shareholding system and to sell a large number of medium- and small-sized SOEs to the private sector.A number of larger enterprise groups will be established in various industries through mergers, acquisitions, and leasing and contracting. The restructuring of SOEs is intended to increase profits and to improve their competitive edge. 4. Ch ina’s Trade by Provinces and Regions A regional breakdown of exports and imports reveals important characteristics of the foreign trade in China. In 1997, 89. 1% of the total exports came from the Eastern region of China (Beijing, Tianjin, Heibei, Lioaning, Guangxi, Shanghai, Jiangsu, Zhejiang, Fujian, Shangdong, Guandong and Hainan).Within the East, the Southeast region accounts for 76. 3% of China's exports in 1997. 4 Guangdong alone produces 41. 6% of the total exports for the same year. Such regional imbalances in exporting activities persist to the present day. In 2001, Guandong's share of the national exports is 36. 0%. For the Southeast and the East, the shares are respectively 79. 0% and 91. 1%. A similar degree of unevenness in trade can be seen in the nation’s imports. For the year 1997, the East and the Southeast accounts for 91. 6% and 74. 7% of the total imports, while Guangdong imports 39. %. In 2001, the East and the Southeast again accounts for 91. 4% a nd 74. 0%. Guangdong remains the international trade powerhouse of China. In 2001, the province imports 34. 6% or more than one-third of the nation's imports. This imbalance of the regional growth in foreign trade may partially be attributed to the various geographic-specific and sequential open-door policies China has exercised throughout the last twenty years. The strong growth of the export sector in the coastal area has been supported by the massive use of foreign direct investment (FDI).FDI was first attracted by the creation of the Special Economic Zones (SEZ). FDI was concentrated in the provinces of the Southeast coast, namely, Guandong and Fujian. The multinational enterprises that are export-oriented or use advanced technologies are able to enjoy various preferential policies in the SEZs, such as reduced or exempted corporate income tax, exemption from import tariffs on imported equipment and raw materials. In 1984, fourteen coastal cities were opened and were granted simi lar policies as SEZs.Out of those fourteen cities, ten are located in the Southeast coast regions and four are in the rest of the Eastern regions. Furthermore in 1985, similar preferential policies were 4 Southeast region includes Shanghai, Jiangsu province, Zhejiang province, Fujian province, Shangdong province, Guandong province and Hainan Province. granted to other coastal economic regions, Pearl River Delta, Yangtze River Delta and Minnan Delta which is to the south of Fujian. In 1990, Pudong in Shanghai was opened and was granted extensive preferential policies.Since 1984, the Chinese government established thirty-two national-level Economic and Technological Development Zones (ETDZs) to enhance FDIs from foreign firms that are export-oriented and technologically advanced. Of those ETDZs, twenty are located in the Southeast coastal area, six are in the rest of the Eastern region, four are in the Central part of China, and only two are in the Western region of China. Thus govern ment policies which establish these economic zones attract foreign direct investment mainly in the Eastern and Southeastern regions, which lead to a concentration of exports and trade in these areas.Another reason for the unevenly high export growth in the Southeast coast is its geographic proximity to Hong Kong, Macao, and Taiwan. Since the early stages of the opening-up of China, Hong Kong has been moving their labor-intensive manufacturing industries to the Southeast of China, mainly to Guangdong, to take advantage of the abundant supply of cheap labor. These firms contributed to the fast growth of processed exports in the region. On the other hand, the Fujian Delta area became the home for many firms from Taiwan due to its geographic and cultural proximity to Taiwan.The share of exports in The Yangtze River Delta, the home of Shanghai and two provinces, Jiangsu and Zhejiang has grown steadily during the period 1997 to 2001. The share of those three regions grew to 10. 1%, 11. 0% , and 9. 1% in 2001 from 8. 1%, 7. 9% and 5. 9% in 1997, respectively. As the role of high-tech industry becomes more significant in China’s output and China’s comparative advantage in skilled-labor and capital-intensive industries becomes higher, the Yangtze River Delta becomes a new magnet for investment by foreign enterprises.These foreign investments in turn lead to more export and trade. 5. Foreign Trade by Major World Regions Using China’s official statistics, Table 4a and 4b highlight merchandise exports and imports to and from major world regions for 1993 – 2001: Asia, Africa, Europe, Latin America, North America and Oceania. As we see from Table 4a, China’s most important export region has always been Asia, which absorbs 53% of China’s exports in 2001. However, their share of absorption declines from almost 62%, their peak level of 1995.The importance of North America and Europe in China’s exports, however, has been increasin g since 1998. In 2001, North America takes in more than 22% of exports and Europe takes in more than 18%. The reliance of China’s trade on Asia can be seen in merchandise imports as well. Asia by far is the largest supplier of China’s imports. Asia accounts for more than 60% of China’s imports in 2001. Furthermore, its share has been more stable than that for exports. The next largest supplier was Europe. However, Europe’s share has been declining gradually over the period.North America has been third, with a share of more than 12% in 2001. A somewhat surprising finding is the significant increase in China’s imports from Africa. Import volume from Africa in 2001 is close to five times as big as it was in 1993. Table 4a and 4b highlight China’s reliance on the Asian market for both its imports and exports. On the other hand, North America has been more of an export market than a source of import supply. 5 5 If we take into account of re-expor ts to different regions, the shares of exports and imports to various world regions will have to be adjusted. . China’s Merchandise Exports and Imports by Major Trading Partners Table 5a and Table 5b document China’s merchandise exports to and imports from its major trading partners, using China’s official statistics. According to Table 5a, the major exports markets for China in 2001 are: the United States (20. 4%), Hong Kong (17. 5%), Japan (16. 9%) and the European Union (15. 4%). It is well-known that a large proportion of Chinese exports to Hong Kong are re-exported elsewhere so that the true size of the Hong Kong export market has to be estimated.To save space for this paper, we will just rely on the official Chinese figures. 6 Even without adjusting for re-exports, the United States in 2001 is the largest export market for China. Thus, from an international trade perspective alone, the most important bilateral trade relationship for China is the relationsh ip with the United States. Together the United States, Hong Kong, Japan and the European Union take in 70. 2% of China’s exports in 2001. Within ASEAN (Association of Southeast Asian Nations), Singapore has been the largest export market for China. In 2001, 31. % of China’s total exports to ASEAN is destined for Singapore. Within the European Union (EU), Germany is the largest market with 23. 8% of the total Chinese exports going to the EU. Turning to the import side, Japan is the largest source of China's imports. In 2001, Japan accounted for 17. 6% of China’s total imports. The European Union comes in second, with a share of 14. 7%. Taiwan and the United States are respectively third and fourth, with shares of 11. 2% and 10. 8%. Korea is fourth largest, with a share of 9. 6%. Korea’s export to China has more than quadrupled in absolute terms from $5. 6 billion in 1993 to $23. 4 billion in 2001 with its share increased from 5. 16% to 9. 6%. Another tradi ng partner that shows a growing importance as a supplier of China’s imports is ASEAN. According to official Chinese figures, in 2001, the total value of their exports to China is $23. 2 billion, which is close to four times as large as it was in 1993. We are aware that the official Chinese trade statistics do not appropriately take the large volume of re-exports via Hong Kong into account and the above comparisons of China’s exports to and import from its trading partners has to be adjusted.For the case of the United States, Fung and Lau (2001) have done detailed adjustments to the official U. S. and Chinese trade data. If we do adjust these trade figures, the two countries with the largest export markets for China in 2001 will almost surely be the United States and Japan. In fact, the United States has been the largest export market for China for quite sometime. This reiterates a point that we have made earlier: from a trade standpoint, the bilateral Sino-U. S. relati onship is the single most important relationship for China. It is essential that China takes steps to maintain the health and stability of such a relationship. . China’s Trade Regime with Entry to the WTO China formally applied to become a member of the GATT in July 1986. It is not until December 2001 that China finally entered the WTO. During these 15 years, China engaged in multilateral negotiations, as well as bilateral negotiations with 37 separate countries and areas including Japan, the United States and the European Union. Although China will enjoy its rights as a full member of the WTO, many domestic laws and regulations need to be reviewed, abolished or modified in order to enforce the WTO agreement and the protocol of accessions.China is required to implement WTO- consistent policy regimes in a wide range of areas and sectors, such as, tariffs, non-tariff6 For details of such adjustments, see Fung and Lau (2001). measures, trade-related investment measure, telecommu nications, financial sector, service sector, government procurement, etc. The following is the short and selective summary of the WTO agreement and its possible impact on China’s economy. 7. 1. Tariffs China has agreed to gradually lower its tariffs on a total of 7,151 items by 2010.Details of the expected changes in the tariff schedules are shown in Table 6. Tariffs on passenger automobiles were 80 to 100% in 1998. Tariffs were cut to 51. 9% with WTO accession and will further be decreased to 25% by 2005. Tariffs on information technology products such as computers and semiconductors will be reduced to zero and those on home appliances such as air conditioners, refrigerators, and television sets will be reduced to 10% to 20% by 2005. The average rate of tariffs on all items at the time of accession in 2001 was 13. 6%, which is scheduled to be lowered to 9. 8% in 2010.Out of 7,151 items, 977 are in agricultural products, whose average rate of tariff is scheduled to be lowered from 22. 7% to 15. 0%. The average rate of tariff on the rest of the 6,174 items, which include mining and manufacturing products, will be lowered from 16. 6% to 8. 9%. China lowered tariffs on over 5,300 items to 12% in January 2002. Currently, the average rate of tariffs on manufactured products is 11. 6%. The average tariff rate on agricultural products is 15. 8%. Cutting tariffs will benefit China’s economy by increasing efficiency and expanding a variety of goods for consumers.Increased foreign competition will challenge domestic producers to improve their competitiveness. The extent of economic benefits from reduced tariffs to foreign firms should also be significant but not as large as it seems. Since 1996, China has already cut tariffs significantly. The average tariff rate on all imports was reduced from 42% in 1992 to 17. 5% in 2000. China’s proposal to reduce the average tariffs amounts to a reduction of a little over 1% a year. But tariff rates applied in certain sectors can be significantly lower than the published rates. This is the case for high technology industry.A new foreign investment policy in 1999, for an example, allows export-oriented foreign firms to import equipment from abroad without any import duties. 7. 2. Other import restrictions China agrees to eliminate any import restrictions that are not WTO compatible, such as import quotas, import licensing, and foreign exchange control by 2005. China subjects a broad range of commodities to import quotas, including agricultural products such as grains and vegetable oils, raw materials such as fertilizer and cotton, consumer products such as color TVs, cameras, video camera recorders, automobiles, and so on.Many products that are subject to import quotas also require import licenses. Accession to the WTO requires China to comply with rules set out by various WTO Articles to ensure nondiscriminatory application of quotas and to make import licensing procedures more transparen t and simple. For example, import quotas on automobiles and parts will be eliminated by 2005. In the meantime, the value of total imports of automobiles and parts allowed will be increased by 15% each year. The elimination of these non-tariff barriers will significantly increase international competition. Protected sectors such as the utomobile industry in China will face difficult challenges from foreign competitors. But after a period of adjustments and consolidations, such industries are expected to become more efficient and competitive. 7. 3. Service Industries In accordance to WTO agreements, China will also open up its service sector to foreign competition, including distribution, insurance, banking, and telecommunications. Telecommunications, including fixed-line telephone services, cellular telephones, and internet services is one area that has been under strong government control in the past.The various restrictions imposed on the sector, such as the percentage of foreign c apital allowed and the area where foreign firms can operate, will be eliminated. A foreign nonlife insurer is permitted to establish as a branch or as a joint venture with 51% foreign ownership. A foreign life insurer is permitted 50% foreign ownership in a joint venture. Over time, geographical restrictions will also be eliminated. Within five years, foreign financial institutions are allowed to have full market access and to provide services to all Chinese clients.The financial position of the Chinese banking system is weak and foreign participation in the sector has been small. In order to improve efficiency and to gain foreign capital, some banks are expected to form strategic partnerships with foreign banks. China will also allow full trading and direct distribution by foreign firms including wholesale and retail trade and the provision of after-sale service. In sum, in all these areas, domestic Chinese entities will face stiff competition from foreign firms.But the increased c ompetition will eventually lead to increased efficiency and higher labor productivity, which will raise China's competitiveness in the world market. 8. China’s Trade Relations with Selective Trading Partners 8. 1 U. S – China Relationship A healthy Sino-U. S. economic relationship is critical to China's economic development. U. S. -China commercial ties have expanded substantially since the beginning of economic reforms. According to Chinese statistics, U. S. exports to China were $721. 1 million and imports were $270. 67 million in 1978.Those figures grew to $26. 20 billion and $54. 28 billion in 2001, respectively. China is currently the 4th largest trading partner for the United States. U. S. -China commercial ties have been strained by a number of issues. The U. S. -China bilateral trade balance has been in deficits for years and is progressively increasing. Even though professional economists view bilateral trade deficits as a result of saving-investment imbalance s and government budget deficits, U. S. policymakers continue to have great concerns with the presence of the bilateral trade imbalances.Fung and Lau (2001) have estimated that the China-United States bilateral trade balance is bigger than what the official Chinese figures indicate, but much smaller than the official U. S. official estimates. These discrepancies are due to a variety of factors, including the different ways imports and exports are measured, re-exports via Hong Kong and the re-export markups imposed by Hong Kong middlemen. Despite the fact that the bilateral trade deficits are not as large as they appear, they are still big and are growing. countries. Table 7a shows the top 15 U. S. mports from China for the years 1995 to 2000. During this period, there is a significant growth in U. S. imports of capital-intensive manufactures goods. The largest import from China has been electrical machinery, Trade imbalances remain a source of trade friction between the two which ac counts for almost 20% of total U. S. imports from China in 2000. Non-electric machinery, which includes boilers, machinery and mechanical appliance, accounts for about 8% of imports in 1995 but has grown to 13% by the year 2000. Non-electric machinery is now the second largest U.S. import item from China. There is no doubt that some of these items are processed exports from China. In other words, production in China and its subsequent export constitutes only one or several stages of the entire global production chain. The rest of the U. S. imports from China largely concentrate in low valued-added and labor-intensive products, such as toys, games, and sports equipment, footwear, furniture, apparel; and leather products. China’s accession to the WTO would likely have a significant positive effect on U. S. -China trade. A study by the U. S.International Trade Commission estimates that the United States will benefit from increasing its exports to China by $3. 1 billion. Another study by Goldman Sachs estimates that China’s WTO accession will bring an additional $13 billion to U. S. exports by 2005. Table 7b shows the top 15 U. S. exports to China for the years 1995 to 2000. As mentioned before, Chinese import quotas and licensing covers a wide range of commodities. A number of items that is important to the United States, including oilseeds, cameras, and motor vehicles have been subjected to both import licensing and quotas.Elimination of import licensing and quotas under the WTO agreement will create a positive impact on the U. S. economy by generating more exports, reducing costs for trade. At the same time, the Chinese economy will also benefit in the longer run as its domestic producers will become more efficient and more productive in the face of more intense foreign competition. The U. S. – China bilateral WTO agreement provides increased access for U. S. agricultural exports across a wide range of commodities. A tariff-rate quota (TRQ) ystem will be established to wheat, corn, rice, oilseeds, vegetable oils, sugar, wool, and cotton, which are identified as priority sectors to the United States. Under a TRQ, the same low in-quota duty is applied to each importer up to a particular amount and out-ofquota rate is applied to any imports that exceed the particular threshold amount. China still can reserve a share of imports for state trading enterprises. The institution of TRQ will provide a share of the TRQ for private traders other than state trading entities. Some U. S. sectors will benefit from significant cuts in tariffs.Overall industrial tariffs will be cut from an average of 24. 6% in 1997 to 9. 4% by 2005. Average tariffs for U. S. priority agriculture products, such as beef, grapes, wine cheese, poultry, and pork will be cut from 31. 5% to 14. 5% by 2004. A study by the U. S. International Trade Commission finds that U. S. exporters will gain from such tariff cuts by a modest amount, ranging from $1. 5 billi on to $1. 9 billion. As U. S. and China expanded their commercial relations, disputes have arisen over a wide variety of issues. One of the on-going trade frictions that the two countries face is textile trade.Under the Agreement on Textile and Clothing, the U. S. textile and clothing quotas will have to be removed by 20057. The U. S. textiles and clothing industries, which have been under the protection of quotas, will be subjected to competition with Chinese imports. But this is likely to be beneficial to both countries, as the United States eliminate the inefficient trade barriers in textile and garment. 7 The U. S. negotiated with China for a special safeguard provision to enable the United States to have additional protection against Chinese imports. 8. Japan-China Relations Japan and China have deepened their economic ties since China’s reform policy started in 1978. Japan is China’s largest trading partner, while China is Japan’s second largest trading pa rtner. The two countries together constitute Asia’s largest trading partner. Although the total volume of trade declined in 1998, it quickly recovered during the following year. According to Chinese statistics, the value of Chinese exports to Japan in 1999 is $32. 40 billion, which exceeds the value of Chinese exports in 1996 before the onset of the Asian financial crisis.There has been robust growth in the volume of trade between the two countries in 2001. Japanese exports to China have grown from $3. 11 billion in 1978 to $42. 8 billion in 2001, and Japanese imports from China have grown from $1. 72 billion in 1978 to $45. 0 billion in 2001. Table 8 takes data from official Japanese trade statistics and it shows changes in the commodity composition of Japanese exports and imports to and from China. 8 Traditionally, China has supplied Japan with agricultural goods and raw materials, while Japan supplied China with capital goods to China. In 1991, Japanese imports of oodstuff s and textile amounts to almost half of its total imports from China, while more than 70% of Japanese exports to China are capital goods. This pattern changes in the 1990s. Japanese imports of foodstuff decline to 10. 7% in 2000, and those of textile declined to 30. 3% after reaching a peak of 36. 4% in 1993. On the other hand, the shares of Chinese exports of both general machinery and electrical machinery increase dramatically from 0. 9% and 4. 0% in 1991 to 6. 9% and 15. 1% in 2000, respectively. A large proportion of the production and export of such machinery in China is processed ith imported components by Japanese affiliated firm, reflecting the increased amount of Japan’s production in the manufacturing sector in China. China concluded its bilateral trade agreement with Japan on September 4, 1999. China’s accession to the WTO would likely have a significant positive effect on SinoJapanese trade for the following reasons. First, China and Japan are important tra ding partners with each other. Second, many products subject to licensing and quotas in China are consumer electronics such as color TVs, VCRs, tape players and cameras, which are major Japanese exports.The removal of non-tariff barriers will eventually strengthen the competitiveness of the Chinese industries. At the same time, it will have a significant impact on Japanese exports. A study by the Economic Planning Agency (2000) of the Japanese government estimates that by 2005, China’s accession to the WTO will increase Japanese exports by 20. 1 billion, while raising its imports from China by 6. 5 billion. The large reduction in Chinese tariffs happens to occur in industries in which Japan has already established competitive edges, such as the automobile industry and the information technology industry.For example, in 1998, Japanese exports share of automobiles to China was 66% in terms of the value, whereas the figures for the U. S. and the EU are 10% and 7%, respectively. China cuts its tariffs on automobile imports from 80-100% to 70-80% at the beginning of 2001. Auto imports from China are expected to continue to increase. 8. 3 ASEAN – China Relations 8 Data are taken from White Paper in International Trade, MITI, Government of Japan, various years. Note that the aggregate import and export values in Table 8 differ from those taken from the official Chinese data.According to ASEAN statistics, their share of China’s trade rises significantly from 5. 8% in 1991 to 8. 3% in 20009. ASEAN has become the fifth largest trade partner of China after Japan, the United States, the European Union and Hong Kong. The change in the commodity composition in ASEAN exports to China is equally remarkable. In 1993, two of their largest export commodities to China are HS#27: mineral fuels; oils; and waxes, and HS#44: wood and articles of wood, which account for about 55% of their total exports. In 2000, however, the share of those commodities declined to pproximately 22%. In contrast, the shares of HS#84 and 85, electrical and general machinery go up from about 12% to 38% during the same period. On the imports side, electrical and general machinery are the largest and the second largest import commodities from China in 1993, and these two items continue to be the most important ones in the year 2000. However, their relative shares in total ASEAN imports from China increase dramatically from 21% in 1993 to 51% in 2000. ASEAN’s largest trading partners (excluding ASEAN itself) have always been the United States, the European Union and Japan.During the 1990s, many ASEAN members started to lose competitiveness and market shares to China. In trading with the large industrialized countries, China has been catching up to the ASEAN member countries. Table 9 shows the exports from ASEAN and China to the United States, the European Union and Japan. Compared to the 1993 Chinese exports, ASEAN’s exports to the United States, the E uropean Union and Japan are respectively 148%, 157%, and 96% larger for the same year. Similar comparisons show that China has been gaining on 9 Data are taken out from the ASEAN Trade Statistics Database.ASEAN throughout the 1990s, By 2000, ASEAN’s exports to these three key markets are only larger than those from China by 30%, 51%, and 25% respectively10. Many ASEAN member countries are concerned as China develops and finally joins the WTO. On the positive side, China’s accession to the WTO will mean greater market access for ASEAN exports to China. Chinese tariffs against ASEAN products will be cut between 34% to 47% by the year 2005 (Thitapha Wattanapruttipaisan, 2001). However, China’s accession also creates new competitiveness challenges to many ASEAN countries.There will be increased Chinese competition in ASEAN’S key export commodities in all the important markets. China’s largest export commodities are electric and general machinery (HS# X VI), which accounts for 31. 9% of their exports in 2001. Among other items, this category includes televisions, sound recorders, parts of those articles, mechanical appliances, and other machinery. Exports by ASEAN countries such as Malaysia, Philippines, and Singapore also rely heavily on these commodities. The share of electric and general machinery in total exports from Malaysia, Philippines, and Singapore in 2000 is 72. 2%, 84. 3%, and 77. 3%, respectively.Due to low wages, China may have competitive advantages in these industries. Another sector that China displays strong competitiveness is textile and clothing. During the 1990’s China has increased its market shares in key markets such as the United States, the European Union and Japan. This sector is particularly important to Thailand, Indonesia, and Philippines. For Philippines, knitted fabric (HS#61) and not-knitted fabric (HS#62) are the third and the fourth largest export commodities in 2000. China’s accessi on to the WTO will likely 10 Since the Asian crisis in 1997, China’s catching-up process appears to be accelerated ntensify competition between exporters from China and from ASEAN in both the Chinese domestic market as well as markets in the industrialized countries. 8. 4 EU – China Relation From 1978, the year when China’s economic reform started, to the year 2001, total trade volume between China and the European Union has increased more than fortyfold. In the early 1990’s, there has been frequent EU anti-dumping proceedings against China. In 1992, there were 20 anti-dumping measures against China, and the figure increases to 30 at the end of 1995 (Roger Strange, 1998).As China’s economy grows, the European Union begins to focus on fostering a more stable relationship with China. In 1995, the European Union passed a document entitled â€Å"A Long-Term Policy for China-Europe Relations. † This document emphasizes the importance of developin g more active economic engagements with China. Further EU policies toward China were set out in the 1998 communication â€Å"Building a Comprehensive Partnership with China†, which was implemented in 2001, with suggestions about concrete ways of furthering EUChina relations.Like almost all of the trading partners with China, a significant amount of trade between the European Union and China occurs as re-exports via Hong Kong. According to the Census and Statistics Department of the Hong Kong government, re-exports of Chinese goods to the European Union is $24. 3 billion in 2000. This accounts for 22. 3% of the total re-exports of goods of Chinese origin that passed through Hong Kong that year. In contrast, Hong Kong’s re-exports of goods from the European Union to China was only $6. 7 billion. This is 10. 7% of all the re-exports that go through Hong Kong to China that year.Table 10 shows the top 10 Chinese exports to and imports from the European Union. EU exports to China is highly concentrated in electrical and non-electrical machinery, accounting for 56% of its total exports to China. Although concentration on this category of exports is fairly common with China’s other trading partners, the extent of such concentration is unique to the European Union. For example, the percentage share of electrical and non-electrical machinery in U. S. total exports to China is 35. 8% in 2000 and comparable figure for Japan for the same year is 47%.In addition, electrical and non-electrical machinery are also important items on the list of EU imports from China. In 2000, this category of goods constitutes 35. 5% of total imports from China to the European Union. A bilateral EU-China agreement on China’s accession to the WTO was concluded on May 19, 2000. China agreed to cut its average import tariffs for 150 key products11 from 18. 6% to 10. 6%. These key products include spirits, cosmetics, leather articles, textiles, building materials, and m achinery and appliances. Furthermore, the agreement made specific commitment in the automobile industry.First, in two years, automobile manufacturers who have invested or will invest in joint ventures with Chinese firms will have freedom to make their own decisions regarding the class and models of the vehicle to be produced. Second, provincial authorities alone can approve automobile foreign investment projects with a value of no more than $150 million. The old limit used to be $30 million. Third, wholly foreign owned enterprises will be allowed in the automobile 11 These key products are spirits, cosmetics, leather articles, textiles, building materials, and machinery and appliances. ngine industry. Opening up the automobile sector is important to the European Union. Many European automobile manufacturers such as Volkswagen, Mercedes, Peugeot, Audi, and BMW are well established in China. Japan has been a key player in this industry in China for many years. But many European manufa cturers, particularly the Germans, have paid increasing attention to the growing Chinese market. . According to the People’s Daily (July 23, 2001), the number of automobiles imported by China from Japan in the first five month of 2001 accounts for 56% of the total imports of automobiles.However China also imports 14% of its automobiles from Germany. In the future, China may face increasing challenges in exporting to the European Union. The first challenge is the increased use of anti-dumping duties by the European Union towards China. According to China Daily (March 28, 2002), the current total number of anti-dumping cases against Chinese products launched by the European Union reaches 91, accounting for about one-fifth of the total anti-dumping cases that China faces. Second, with the launch of the Euro and plans to expand the European Union to include more members, there should be an increase of intra-EU trade.In some instances, the increase in intra-EU trade may occur at t he expense of trade with non-EU countries such as China. 9. Conclusion China has gone a considerable distance in its attempt to integrate itself to the global economy. China’s economy is an increasingly open one. In 2001, its total trade to GDP ratio reaches 44%. In December 2001, China formally joins the WTO. By joining the WTO, China binds itself to a rule-based trading system and signals to the world that it is ready to continue and even accelerate its open door reform policy. China’s trade is characterized by at least four characteristics.First, a large amount of trade is actually conducted by foreign firms in China. In 2001, 50% of Chinese trade is carried out by foreign-invested firms. Second, a very high percentage of Chinese trade is processed trade. In 2001, 47% of Chinese trade is related to processing. Furthermore, of the processed trade, 73% is conducted by foreign-invested enterprises. Third, there is a large amount of re-exports in China’s interact ions with the world. In 2001, 39% of China’s exports go through Hong Kong to be re-exported elsewhere. Lastly, China’s trade is geographically concentrated.In 2001, 35. 3% of Chinese trade originates from one province, viz. Guangdong. What might we expect to see in the future? With increased integration in the global economy, the prominent role of foreign firms in China’s trade will likely continue. The presence of foreign firms in Chinese trade reflects also the increased use of global outsourcing as a competitiveness strategy by multinationals from the industrialized economies. With low wages and a large pool of high quality labor, China has become a critical link in the global network of production fragmentation.At the same time, as China continues to grow, more and more of the foreign-invested firms, particularly those from the United States, Japan and the European Union, are set up to sell to the booming domestic Chinese market. While processed trade should remain an important feature of Chinese trade, it is no longer confined to low-tech and low value-added activities. U. S. high-technology companies continue to subcontract to firms in Taiwan. The same Taiwanese firms are moving or subcontracting to the Mainland. China has also become an important market for information technology (IT) products.According to the American Electronics Association (AEA), the largest umbrella industry group of high-technology companies in the United States, China is now the third largest IT market in the world. In fact, due to its own estimation of the importance and growth of China’s IT market, Silicon Valley acted as one of the most vocal and strongest supporters for China to join the WTO. In the near future, we can expect to see that China’s trade will be increasingly high-tech. The share of re-exports in China’s trade has declined in recent years. It is expected that this trend will continue.As China’s trade regime becomes more rule-based and more transparent, Chinese trade will also become more direct. With its advanced infrastructure in finance, insurance, shipping and telecommunications, Hong Kong remains a favorite site for multinationals to set up and maintain its regional headquarters. Hong Kong will continue to play an important role in coordinating the global supply chains involving parents of multinationals and specialized suppliers located in China and other Asian countries. The share of trade conducted by Guangdong province remains high.But there are indications that Shanghai and the Yangtze River Delta have taken an increasing active role in the last few years. Over time, we may expect to see that there is some mild diversification in the share of trading activities away from Guangdong. In the future, we see that there are at least two challenges facing China in the area of international trade. First, with China’s competitiveness growing, many countries will perceive that their prod ucers will not be able to compete with the Chinese exports, either in the third market or in their own domestic market. The backlash will take the form of n increased use of anti-dumping duties and safeguards. We have already seen the use of such trade instruments against China from a variety of countries, including Japan, the European Union and the United States. A relatively new development is that even developing countries such as India and Mexico are using anti-dumping measures against Chinese exports to their countries. The difficulty with anti-dumping duties is that they are generally WTO-consistent. Thus joining the WTO does not mean that other countries will reduce their use of anti-dumping duties against China.A second challenge facing China is how to manage its trade relationship with the United States. The United States is the largest economy on earth. The United States is China’s largest export market. It is also a critical source of technology. A stable and healt hy relationship with the United States is important for China’s economic development. It is always a difficult adjustment process for countries to accept a newly emergent economic power. 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WTO, 2002, â€Å"China Accession to the World Trade Organization,† mimeo.Table 1 China's Foreign Merchandise Trade Year 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Trade Volume (US $ billion) Total Exports Imports 20. 7 29. 4 38. 1 44 41. 6 43. 6 53. 5 69. 7 73. 8 82. 7 102. 8 111. 7 115. 4 135. 7 165. 6 195. 8 236. 7 280. 9 289. 9 325. 2 323. 9 360. 6 473. 3 509. 8 9. 8 13. 7 18. 1 22 22. 3 22. 2 26. 1 27. 4 30. 9 39. 4 47. 5 52. 5 62. 1 71. 9 85 91. 8 121 148. 8 151 182. 8 183. 7 194. 9 249. 2 266. 2 10. 9 15. 7 20 22 19. 3 21. 4 27. 4 42. 3 42. 9 43. 2 55. 3 59. 1 53. 63. 8 80. 6 104 115. 7 132. 1 138. 8 142. 4 140. 2 165. 7 225. 1 243. 6 Balance -1. 1 -2 -1. 9 0 3 0. 8 -1. 3 -14. 9 -12 -3. 8 -7. 8 -6. 6 8. 7 8. 1 4. 4 -12. 2 5. 3 16. 7 12. 2 40. 4 43. 5 29. 2 24. 1 22. 5 Total 100 142 184 213 201 211 258 337 357 400 497 540 557 656 800 946 1,143 1,357 1,400 1,571 1,565 1,742 2,287 2,463 Index 1978=100 Exports Imports 100 140 185 224 228 227 266 280 315 402 485 536 634 734 867 937 1,235 1,518 1,541 1,865 1,875 1,989 2,543 2,716 100 144 183 202 177 196 251 388 394 396 507 542 490 585 739 954 1,061 1,212 1,274 1,306 1,287 1,520 2,065 2,234Source: China's Cust oms Statistics, various years, General Administration of Customs of the People's Republic of China. Note: The figures are in US$ billion. Exports are valued on a f. o. b. basis, imports on a c. i. f. basis. Table 2a Composition of China's Export (US$100million) Total Primary goods total food Manufacture goods raw beveraes materials mineral oil total chemicals textile machinery miscel. others 1980 181. 19 91. 14 29. 85 0. 78 17. 11 42. 8 0. 6 90. 05 11. 2 39. 99 8. 43 28. 36 2. 07 1981 220. 07 102. 48 29. 24 0. 6 19. 48 52. 28 0. 88 117. 59 13. 42 47. 06 10. 87 37. 25 8. 99 1982 223. 1 100. 5 29. 08 0. 97 16. 53 53. 14 0. 78 122. 71 11. 96 43. 02 12. 63 37. 05 18. 05 1983 222. 26 96. 2 28. 53 1. 04 18. 92 46. 66 1. 05 126. 06 12. 51 43. 65 12. 21 38. 04 19. 65 1984 261. 39 119. 34 32. 32 1. 1 24. 21 60. 27 1. 44 142. 05 13. 64 50. 54 14. 93 46. 97 15. 97 1985 273. 5 138. 28 38. 03 1. 05 26. 53 71. 32 1. 35 135. 22 13. 58 44. 93 7. 72 34. 86 34. 13 1986 309. 42 112. 72 44. 48 1. 19 29 . 08 36. 83 1. 14 196. 7 17. 33 58. 86 10. 94 49. 48 60. 09 1987 394. 37 132. 31 47. 81 1. 75 36. 5 45. 44 0. 81 262. 06 22. 35 85. 7 17. 41 62. 73 73. 87 1988 475. 16 144. 06 58. 9 2. 35 42. 57 39. 0. 74 331. 1 28. 97 104. 89 27. 69 82. 68 86. 87 1989 525. 38 150. 78 61. 45 3. 14 42. 12 43. 21 0. 86 374. 6 32. 01 108. 97 38. 74 107. 55 87. 33 1990 620. 91 158. 86 66. 09 3. 42 35. 37 52. 37 1. 61 462. 05 37. 3 125. 76 55. 88 126. 86 116. 25 1991 718. 43 161. 45 72. 26 5. 29 34. 86 47. 54 1. 5 556. 98 38. 18 144. 56 71. 49 166. 2 136. 55 1992 849. 4 170. 04 83. 09 7. 2 31. 43 46. 93 1. 39 679. 36 43. 48 161. 35 132. 19 342. 34 NA 1993 917. 44 166. 66 83. 99 9. 01 30. 52 41. 09 2. 05 750. 78 46. 23 163. 92 152. 82 387. 81 NA 1994 1,210. 06 197. 08 100. 15 10. 02 41. 27 40. 69 4. 95 1,012. 98 62. 6 232. 18 218. 95 499. 37 0. 12 1995 1,487. 80 214. 85 99. 54 13. 7 43. 75 53. 32 4. 54 1,272. 95 90. 94 322. 4 314. 07 545. 48 0. 06 1996 1,510. 48 219. 25 102. 31 13. 42 40. 45 59. 31 3. 76 1,291. 23 88. 77 284. 98 353. 12 564. 24 0. 12 1997 1,827. 92 239. 53 110. 75 10. 49 41. 95 69. 87 6. 47 1,588. 39 102. 27 344. 32 437. 09 704. 67 0. 04 1998 1,837. 57 206 106. 19 9. 76 35. 17 51. 81 3. 07 1,631. 57 103. 16 323. 83 502. 33 702. 2 0. 05 1999 1,949. 31 199. 41 104. 58 7. 71 39. 21 46. 59 1. 32 1,749. 90 103. 73 332. 62 588. 36 725. 1 0. 09 2000 2,492. 03 254. 6 122. 82 7. 45 44. 62 78. 55 1. 6 2,237. 43 120. 98 425. 46 826 862. 78 2. 21 2001 2,661. 54 263. 53 127. 79 8. 74 41. 73 84. 16 1. 11 2,398. 01 133. 53 438. 23 949. 18 871. 23 5. 85 Source: China Statistical Yearbook 2001, China's Customs Statistics Monthly, December 2001 Note: Since 1992 and 1993, there has been a change in the classification system for for categories like â€Å"Others†. tem † Table 2b Composition of China's Import (US$100 million) Manufacture goods raw total food beveraes materials mineral oil total chemicals textile machinery miscel. others 1980 200. 17 69. 59 29. 27 0. 36 35. 5 4 2. 03 2. 39 130. 58 29. 09 41. 4 51. 19 5. 42 3. 34 1981 220. 15 80. 44 36. 22 2. 13 40. 27 0. 83 0. 99 139. 71 26. 06 40. 35 58. 66 5. 58 9. 06 1982 192. 85 76. 34 42. 01 1. 3 30. 12 1. 83 1. 08 116. 51 29. 36 39. 06 32. 04 4. 86 11. 19 1983 213. 9 58. 08 31. 22 0. 46 24. 59 1. 11 0. 7 155. 82 31. 83 62. 89 39. 88 7. 82 13. 4 1984 274. 1 52. 08 23. 31 1. 16 25. 42 1. 39 0. 8 222. 02 42. 37 73. 18 72. 45 11. 82 22. 2 1985 422. 52 52. 89 15. 53 2. 06 32. 36 1. 72 1. 22 369. 63 44. 69 118. 98 162. 39 19. 02 24. 55 1986 429. 04 56. 49 16. 25 1. 72 31. 43 5. 04 2. 05 372. 55 37. 71 111. 92 167. 81 18. 77 36. 34 1987 432. 16 69. 15 24. 3 2. 63 33. 21 5. 39 3. 49 363. 01 50. 08 97. 3 146. 07 18. 78 50. 78 1988 552. 75 100. 68 34. 76 3. 46 50. 9 7. 87 3. 69 452. 07 91. 39 104. 1 166. 97 19. 82 69. 79 1989 591. 4 117. 54 41. 92 2. 02 48. 35 16. 5 8. 75 473. 86 75. 56 123. 35 182. 07 20. 73 72. 15 1990 533. 45 98. 53 33. 35 1. 57 41. 07 12. 72 9. 82 434. 92 66. 48 89. 06 168. 45 21. 03 89. 9 1991 637. 91 108. 34 27. 99 2 50. 03 21. 13 7. 19 529. 57 92. 77 104. 93 196. 01 24. 39 111. 47 1992 805. 85 132. 55 31. 46 2. 39 57. 75 35. 7 5. 25 673. 3 111. 57 192. 73 313. 12 55. 88 NA 1993 1,039. 59 142. 1 22. 06 2. 45 54. 38 58. 19 5. 2 897. 49 97. 04 285. 27 450. 23 64. 95 NA 1994 1,156. 14 164. 86 31. 37 0. 68 74. 37 40. 35 18. 09 991. 28 121. 3 280. 84 514. 67 67. 68 6. 79 1995 1,320. 84 244. 17 61. 32 3. 94 101. 59 51. 27 26. 05 1,076. 67 172. 99 287. 72 526. 42 82. 61 6. 93 1996 1,388. 33 254. 41 56. 72 4. 97 106. 98 68. 77 16. 97 1,133. 92 181. 06 313. 91 547. 63 84. 86 6. 46 1997 1,423. 70 286. 2 43. 04 3. 2 120. 06 103. 06 16. 84 1,137. 50 192. 97 322. 2 527. 74 85. 5 9. 09 1998 1,401. 66 229. 52 37. 93 1. 79 107. 16 67. 73 14. 91 1,172. 14 201. 66 310. 71 567. 68 84. 55 7. 54 1999 1,656. 99 268. 46 36. 19 2. 08 127. 89. 12 13. 67 1,388. 53 240. 3 243. 17 694. 53 97. 01 13. 52 2000 2,250. 94 467. 39 47. 58 3. 64 200. 03 206. 37 9. 77 1,783. 55 302. 13 418. 07 919. 31 127. 51 16. 53 2001 2,436. 13 457. 74 49. 76 4. 12 221. 28 174. 95 7. 63 1,978. 40 321. 06 419. 39 1,070. 42 150. 76 16. 77 Source: China Statistical Yearbook 2001, China's Customs Statistics Monthly, December 2001. Note: Since 1992 and 1993, there has been a change in the classification system for categories like â€Å"Others†. Total Primary goods Table 3a Exports by Type of Enterprise and by Customs Regime (US$ billion) 1995 1996 1997 1998 Total 148. 151. 1 182. 7 183. 8 Process and Assembly 20. 7 24. 2 29. 4 30. 7 Process with Imported Materials 53 60. 1 70. 2 73. 7 Process and Assembly Total SOE FIE sub total Process with Imported Materials Total SOE FIE sub total 1995 20. 7 17. 3 2. 9 1995 53 13. 4 39. 2 1996 24. 2 19 4. 5 1996 60. 1 10. 9 48. 6 1997 29. 4 22. 3 6. 1 1997 70. 2 11. 7 57. 7 1998 30. 7 22. 5 7. 2 1998 73. 7 10. 9 62 1999 194. 9 35. 8 75. 1 1999 35. 8 24. 2 10. 4 1999 75. 1 9. 8 64. 2 2000 249. 2 41. 1 96. 5 2000 41. 1 26. 5 13. 1 2000 96. 5 10. 4 84. 1 2001 266. 2 42. 2 105. 2 2001 42. 2 26 14. 3 2001 105. 2 9. 9 92. Table 3b Imports by Type of Enterprise and by Customs Regime (US$ billion) Total 1995 1996 1997 1998 Process and Assembly 132. 1 138. 8 142. 4 140. 2 Process with Imported Materials 16. 2 17. 8 20. 9 19. 9 42. 1 44. 5 49. 3 48. 7 Process and Assembly Total SOE FIE sub total Process with Imported Materials Total SOE FIE sub total Source: China's Customs Statistics, various years. 1995 16. 2 13. 2 2. 7 1995 42. 1 7. 4 34. 4 1996 17. 8 13. 6 3. 7 1996 44. 5 6. 5 37. 8 1997 20. 9 15. 4 4. 9 1997 49. 3 6. 1 42. 9 1998 19. 9 14. 2 5 1998 48. 7 5. 1 43. 2 1999 165. 7 23. 6 50 1999 23. 6 15. 4 7. 1999 50 4. 3 45. 3 2000 225. 1 28 64. 6 2000 28 17. 4 9. 7 2000 64. 6 4. 8 58. 9 2001 243. 6 28. 9 65. 1 2001 28. 9 16. 9 10. 8 2001 65. 1 4. 3 59. 5 Table 4a China's Exports to Major World Regions (US$ billion) Export To Total Asia North Anerica Europe Latin America Oceania Africa 1993 91. 74 52. 62 18. 16 16. 43 1. 78 1. 23 1. 53 1 994 121 73. 45 22. 86 18. 77 2. 45 1. 72 1. 75 1995 148. 77 92 26. 24 22. 98 3. 15 1. 9 2. 49 1996 151. 07 91. 25 28. 3 23. 87 3. 12 1. 96 2. 57 1997 182. 7 108. 92 34. 6 28. 96 4. 61 2. 4 3. 21 1998 183. 71 98. 18 40. 1 33. 43 5. 32 2. 66 4. 06 1999 194. 93 102. 8 44. 39 35. 47 5. 27 3. 11 4. 11 2000 249. 21 132. 31 55. 28 45. 48 7. 19 3. 91 5. 04 2001 266. 15 140. 96 87. 88 49. 24 8. 24 4. 07 6. 01 Table 4b China's Imports from Major World Regions (US$ billion) Import From Total Asia North America Europe Latin America Oceania Africa 1993 103. 96 62. 6 12. 07 23. 97 1. 93 2. 36 1 1994 115. 62 68. 77 15. 74 25. 02 2. 25 2. 92 0. 89 1995 132. 08 78. 05 18. 8 27. 81 2. 97 3. 02 1. 43 1996 138. 84 83. 44 18. 73 27. 66 3. 61 3. 94 1. 46 1997 142. 36 88. 4 18. 31 25. 75 3. 77 3. 67 2. 46 1998 140. 24 87. 05 19. 2 26. 31 2. 99 3. 14 1. 48 1999 165. 72 101. 9 21. 82 32. 65 2. 99 4. 19 2. 38 2000 225. 1 141. 34 26. 12 40. 78 5. 41 5. 88 5. 56 2001 243. 61 147. 18 30. 24 48. 4 6. 7 6. 29 4. 79 Source: China's Customs Statistics, various years Table 5a Merchandise Exports to Major Trading Partners (US$ Billion) 1993 91. 74 22. 05 1. 46 15. 78 2. 86 16. 96 12. 24 3. 97 1. 29 1. 61 1. 3 1. 93 4. 68 2. 25 1994 121 32. 36 2. 24 21. 58 4. 38 21. 46 15. 39 4. 76 1. 42 2. 27 1. 59 2. 41 6. 38 2. 56 1995 148. 77 35. 98 3. 1 28. 46 6. 69 24. 71 19. 09 5. 67 1. 84 3. 23 2. 07 2. 79 9. 04 3. 5 1996 151. 07 32. 91 2. 8 30. 87 7. 51 26. 69 19. 83 5. 84 1. 91 3. 4 1. 84 3. 2 9. 7 3. 75 1997 182. 7 43. 78 3. 4 31. 82 9. 12 32. 69 23. 81 6. 49 2. 33 4. 4 2. 24 3. 81 12.