Evaluation Of The Composite Export Similarity Index On The Example Of China

Abstract

The purpose of this article is to enhance the Export Similarity Index to provide more reliable results on whether and to what extent two countries are potential and immediate competitors in the global trade. To achieve this existing methodology was complemented with the set of geographical destinations. This allows the evaluation of the overlap in export portfolios of two or more countries and understanding the possible level of their competition in international trade. To prove the efficiency of this enhanced index China’s export portfolio was compared with 50 largest exporters. Achieved results demonstrate a strong overlap of Chinese trade with Vietnam, Japan, and the Philippines proving the veracity of the introduced methodology.