Introduction to the special issue

Abstract

The global economic growth has slowed down due to both the pandemic effects and the de-globalization. The world trade organization (WTO), as the most important representative organization of global multilateral economic corporations, is under threat due to the ineffective enforcement of its dispute settlement committee. Many countries, especially advanced economics, are suffered from the negative shocks and results in a negative economic growth in 2020. However, China, as the current largest developing country and the second-largest economy in the world, still realized a modest economic growth of 2.3% in 2020, when the pandemic was the most severe. This observation indeed raises two issues. First, as a locomotive of the whole world’s economic growth, how can China find a way to maintain its sustainable economic growth in the coming years? Second, how can China further open up to address the challenge of de-globalization caused by the weakened global multilateral economic corporation? Given China accounted for around 18% of global GDP in 2020, China’s sustainable economic growth and deep integration into the global economy are important not only for China but also for the rest of the world. To answer the first question, in this special issue, Justin Lin provides an insightful analysis of the dual-circulation development strategy advocated by the Chinese government. Notably, Justin discusses the following three questions: First, why does China put a particular focus on domestic circulation? Second, why is it important to fully employ both domestic and international resources and markets? Third, how will China structure its new development pattern? Justin forcefully argues that it is crucial to tap development potential through structural reform for China’s dual circulation. In addition, it is necessary to deepen the reform and clear obstacles that constrain the development of domestic circulations and implement the measures for further opening up, and better leverage the international resources and markets. To further open up, China indeed puts a particular focus on the Regional Comprehensive Economic Partnership (RCEP) agreement. East Asian countries signed the RCEP in November 2020. As carefully analyzed by Peter Drysdale and Shiro Armstrong, the RCEP agreement consolidated the 10-member ASEAN’s free trade agreements and the three northeast Asian economic powers, China, Japan, and South Korea, along with Australia and New Zealand.