Bilateral Tradebetween China and SudanInternational Economics, Spring Semester 2013Eumni Kim, Hana Jin, Peter Enos, Sophea...
ContentsI. Overview / Country ProfileII. Trade HistoryIII. Trade PoliciesIV. Major CommoditiesV. Terms of TradeVI. Challen...
Ⅰ. Overview – China at a glanceFULL NAME, CAPITAL: PEOPLES REPUBLIC OF CHINA,BEIJINGLANGUAGE: Standard Chinese (Putonghua,...
Ⅰ. Overview – China at a glance2. TRADEBreakdown in economys total Exports Breakdown in economys total ImportsAgricultural...
Ⅰ. Overview – Sudan at a glanceCountry ProfileFULL NAME, CAPITAL: REPUBLIC OF THE SUDAN,KHARTOUMLANGUAGE: Arabic, English ...
Ⅰ. Overview – Sudan at a glanceCountry ProfileTRADEBreakdown in economys total Exports Breakdown in economys total Imports...
Ⅱ. Trade history between Sudan & China◈ to establish official relationships◈ ETC(Economic and TechnicalCooperation)◈ CSTP(...
Ⅱ. Trade history between Sudan & China◈ C began to pursuit external E sources- By 1996, CNPC took control of most ofSudan’...
Trade Policies• China’s unilateral tariff preferences. Duty-free access to95 percent of imports from LDCs including Sudan....
• Open-door Trade and Investment Policy (Deng Xiaoping’srule) vs selective protection in foreign investment andindustrial ...
Sudan• Mutual quality assurance policy; both imported andexported commodities: Quality and Health standards• Competition p...
Trade Policy: ImplicationsChina• Access to natural resourcesexploitation due to (so-called)mutual trust.• Estimates state ...
By Sophea SokTrading Commodities
Exports $11.67 billion (2008 est.)Imports $8.229 billion (2008 est.)Exports – commodities oil and petroleum products; cott...
•Sudan Trade with ChinaBy Sophea SokTrading Commodities
• Sudan’s export volume to ChinaBy Sophea SokTrading Commodities
• Arms Trade• China is also Sudan’s main supplier of arms and has big interests inrailways and other Sudanese ventures.By ...
•Arms TradeBy Sophea SokTrading Commodities
•Arms Trade• The first reported shipment of Chinese arms to Sudan appeared under the rule ofSadiq al-Mahd (1986–89).• Arms...
Terms ofTradeFATIMA IBRAHIM
About Terms .Of .Trade• Is the value of a country’s exports relative to thatof it’s imports. It is calculated by dividing ...
Less than 100%If a country’s terms of trade is less than 100%, itmeans that there is more capital going out to buyimports ...
Greater than 100%A result greater than 100% means thecountry is accumulating capital i.e.more money is coming in from expo...
Effects of T.o.TBy Fatima Ibrahim
If we must trade…• Trade will only take place if theterms of trade lie within theopportunity cost ratios ofproduction for ...
Price may fluctuateBy Fatima Ibrahim
Improving & Deteriorating T.O.TBy Fatima Ibrahim
Terms of trade indexBy Fatima Ibrahim
AssumptionsIt is assumed that due to the ff reasons the termsof trade(earnings)index will remain inconsistentin terms of i...
Challenge of Trade• After Secession ofSouth Sudan,Sudan doesnthave much oil totradeBy Sabin S. Chaudhary
• Conflict:▫ Between SouthSudan andSudan▫ In Darfur Area▫ Rebel groupsChallenge of TradeBy Sabin S. Chaudhary
• Sudan has been trying to boost exports of agriculturalproducts and livestock.Sudan: Share of agriculture in GDP Source: ...
• When investment activities carry with them labor-intensive components (building and construction).Chinese labor is large...
Opportunities• China should serve as a Peace Broker for the conflictbetween the two Sudan countries to prevent full-fledge...
Opportunities• Petrochemical Industry• Financial Institutions• Economic Infrastructure▫ Transportation System: Railway ($ ...
Economic Gains• Oil Fees:▫ 2013 $500mn▫ 2014 $2bn• Transit for GoodsBy Foster Abogye Gyamfi
Conclusion• China helped addressed the issue of the oil fee impassebetween North and South Sudan primarily throughdiplomac...
Conclusion• Sudan had served as bridgehead for China into Africa oilmarket• Sudan has been a major recipient of Chinese fo...
Reference• Energy Information Administration (EIA), “Sudan and South Sudan,”Country Analysis Briefs (updated March 19, 201...
Thank you.
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Bilateral trade between china and sudan

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  • Revitalizing Sudan’s Non-Oil Exports: A Diagnostic Trade Integration Study (DTIS) Prepared for the Integrated Framework Program December 2008
  • China’s trade policies must be seen in the context of the domestic economy and its political arrangements, and also in the context of China’s rising geopolitical power. Unreported and extensive government subsidies
  • China is predicted to be the world’s biggest economy by 2050 and be the largest trading nation in the world.
  • Bilateral trade between china and sudan

    1. 1. Bilateral Tradebetween China and SudanInternational Economics, Spring Semester 2013Eumni Kim, Hana Jin, Peter Enos, Sophea Sok,Fatima Ibrahim, Sabin S. Chaudhary,Foster Abogye Gyamfi
    2. 2. ContentsI. Overview / Country ProfileII. Trade HistoryIII. Trade PoliciesIV. Major CommoditiesV. Terms of TradeVI. Challenges of Bilateral tradeVII. Future trade opportunities and Conclusion
    3. 3. Ⅰ. Overview – China at a glanceFULL NAME, CAPITAL: PEOPLES REPUBLIC OF CHINA,BEIJINGLANGUAGE: Standard Chinese (Putonghua, official)POPULATION: 1,344.1 (millions)KEY ECONOMIC RATIOS & LONG-TERM TRENDS1. Rapid Economic Performance in ChinaSource: IMF, World Economic Outlook (Apr. 2013)By Eunmi, Kim
    4. 4. Ⅰ. Overview – China at a glance2. TRADEBreakdown in economys total Exports Breakdown in economys total ImportsAgricultural products 3.4 Agricultural products 8.3Fuels and mining products 3.1 Fuels and mining products 29.6Manufactures 93.3 Manufactures 59.2- Main destination1. European Union (27) 18.8 1. European Union (27) 12.12. United States 17.1 2. Japan 11.23. Hong Kong, China 14.1 3. Korea, Republic of 9.34. Japan 7.8 4. Taipei, Chinese 7.2Source: Development Economics LDB database, World BankBy Eunmi, Kim
    5. 5. Ⅰ. Overview – Sudan at a glanceCountry ProfileFULL NAME, CAPITAL: REPUBLIC OF THE SUDAN,KHARTOUMLANGUAGE: Arabic, English (official)POPULATION: 34.3 (millions)KEY ECONOMIC RATIOS & LONG-TERM TRENDS1. Economic Performance in SudanSource: IMF, World Economic Outlook (Apr. 2013)By Eunmi, Kim
    6. 6. Ⅰ. Overview – Sudan at a glanceCountry ProfileTRADEBreakdown in economys total Exports Breakdown in economys total ImportsAgricultural products 6.2 Agricultural products 23.8Fuels and mining products 87.6 Fuels and mining products 3.1Manufactures 0.7 Manufactures 72.2- Main destination1. China 65.3 1. China 16.62. United Arab Emirates 10.5 2. European Union (27) 14.43. Canada 8.8 3. Japan 9.5Source: Development Economics LDB database, World Bank
    7. 7. Ⅱ. Trade history between Sudan & China◈ to establish official relationships◈ ETC(Economic and TechnicalCooperation)◈ CSTP(Cultural, Scientific and TechnicalProtocol)◈ the Tiananmen Square crackdown & the Bashir-Turabi coup=> alienated China&Sudan from westerncountries and led them to a strongpartnership.19591959198919891962196219701970By Hana Jin
    8. 8. Ⅱ. Trade history between Sudan & China◈ C began to pursuit external E sources- By 1996, CNPC took control of most ofSudan’s oil◈ Purchased 70% of Sudanese oil exports◈ Trade Volume: 8.6 billion USD◈ South Sudan’s independence=> Sudan lost ¾ oil production,trying to boost exports in agriculture◈ China & Sudan signed up to set upan agricultural trade zone201120112012201220102010Mid-1990sMid-1990sOilLowInterestLoans,WeaponsBy Hana Jin
    9. 9. Trade Policies• China’s unilateral tariff preferences. Duty-free access to95 percent of imports from LDCs including Sudan.Table 1.0 Sudan Faces Mostly Low Tariffs in Major Export MarketsImporting Country Simple Weighted Maximum Coefficient Share TariffAverage Average Rate of variation Non-deductibals YearChina 7.7 0.32 40 77 97 2006European Union 0 0 0 95 2006India 13.6 15.4 30 48 5 2005Indonesia 3.3 0.1 20 169 98 2001Japan 2.6 0 29.8 436 100 2006Korea 35.1 20.1 630 152 1 2006Saudi Arabia 0 0 0 100 2006MENA average 1.2 0.69 30 338 88 2006SSA average 4.8 2.3 30 154 41 2006Source: WITS calculations using UNCTAD TRAINS and UN Comtrade databases.Notes: Averages are derived using traded products only. Calculations assume that all available preferences areutilized and do not take into account tariff exemptions, duty-drawbacks, etcBy Peter Enos
    10. 10. • Open-door Trade and Investment Policy (Deng Xiaoping’srule) vs selective protection in foreign investment andindustrial policy targeting- Extensive governmentsubsidies• Non-interference on domestic affairs of the partner state.Trade sometimes driven more by foreign policy thancommercial considerations• Engagement approach vs punitive approach• Trade, FDI and aid- China agreed to write off $80 millionin Sudanese debt, and provide an interest-freeunconditional loan of $13 million for infrastructureprojects, including a new presidential palace; pledged $5.1million for humanitarian aid for DarfurTrade PoliciesBy Peter Enos
    11. 11. Sudan• Mutual quality assurance policy; both imported andexported commodities: Quality and Health standards• Competition policy- Microcredit and business skills tosmall and medium enterprises aimed to enhancecompetition with Chinese business.Trade PoliciesBy Peter Enos
    12. 12. Trade Policy: ImplicationsChina• Access to natural resourcesexploitation due to (so-called)mutual trust.• Estimates state that nearly400 million people have beenlifted out of poverty due totrade over the last 25 years.Sudan• Exporters benefit from tariffpreferences• An increase in volume of tradein non-oil exports• Consumer surplus• Political stability, governanceand human rights in adeadlock?By Peter Enos
    13. 13. By Sophea SokTrading Commodities
    14. 14. Exports $11.67 billion (2008 est.)Imports $8.229 billion (2008 est.)Exports – commodities oil and petroleum products; cotton, sesame, livestock,groundnuts, gum Arabic, sugarExports – partners China 49.8%, Japan 33.4%, Indonesia 5.5% (2008)Imports – commodities foodstuffs, manufactured goods, refinery andtransport equipment, medicines and chemicals,textiles, wheatImports - partners China 20%, Saudi Arabia 8.4%, UAE 6.2%, India6.1%, Egypt 5.5%, Italy 4.1% (2008)By Sophea SokTrading Commodities
    15. 15. •Sudan Trade with ChinaBy Sophea SokTrading Commodities
    16. 16. • Sudan’s export volume to ChinaBy Sophea SokTrading Commodities
    17. 17. • Arms Trade• China is also Sudan’s main supplier of arms and has big interests inrailways and other Sudanese ventures.By Sophea SokTrading Commodities
    18. 18. •Arms TradeBy Sophea SokTrading Commodities
    19. 19. •Arms Trade• The first reported shipment of Chinese arms to Sudan appeared under the rule ofSadiq al-Mahd (1986–89).• Arms deliveries from China to Sudan• China• Military weapons and small arms from China to Sudan were valued atUSD 1 million in 2002 rising to USD 23 million in 2005.• USD 57 million worth of aircraft equipment was transferred to Sudan between2003 and 2005.• Ammunition, high altitude bombs,• Tanks and military trucks,• Helicopters, and fighter aircraft.• Appears to have become Sudan’s largest seller ofweapons just prior to the onset of the Darfur conflict.• Arms sales to Sudan since 2004 account for 90% of smallarms present in the country, and• Provision of training, transport vehicles and aircrafthave also added to the Sudanese arsenal.By Sophea SokTrading Commodities
    20. 20. Terms ofTradeFATIMA IBRAHIM
    21. 21. About Terms .Of .Trade• Is the value of a country’s exports relative to thatof it’s imports. It is calculated by dividing thevalue of exports by the value of imports, thenmultiplying the result by 100%.Measurement is recorded in an index, for economic monitoring.By Fatima Ibrahim
    22. 22. Less than 100%If a country’s terms of trade is less than 100%, itmeans that there is more capital going out to buyimports than there is coming into the country.It is often important to know why exports increase relative toimports, especially since the terms of trade are directly impacted bychanges in export and import prices.By Fatima Ibrahim
    23. 23. Greater than 100%A result greater than 100% means thecountry is accumulating capital i.e.more money is coming in from exports.Using terms of trade to determine the health of acountry’s economy can draw the wrong conclusions.By Fatima Ibrahim
    24. 24. Effects of T.o.TBy Fatima Ibrahim
    25. 25. If we must trade…• Trade will only take place if theterms of trade lie within theopportunity cost ratios ofproduction for both countries.By Fatima Ibrahim
    26. 26. Price may fluctuateBy Fatima Ibrahim
    27. 27. Improving & Deteriorating T.O.TBy Fatima Ibrahim
    28. 28. Terms of trade indexBy Fatima Ibrahim
    29. 29. AssumptionsIt is assumed that due to the ff reasons the termsof trade(earnings)index will remain inconsistentin terms of improvement & deteriorationbetween the two countries due to : -• Constant price fluctuation in the global oilmarket• Foreign exchange rate increase or decrease.• Depreciation or appreciation in their stocks mostespecially for Sudan’s case coming from a fragilestatus of War and Separation.By Fatima Ibrahim
    30. 30. Challenge of Trade• After Secession ofSouth Sudan,Sudan doesnthave much oil totradeBy Sabin S. Chaudhary
    31. 31. • Conflict:▫ Between SouthSudan andSudan▫ In Darfur Area▫ Rebel groupsChallenge of TradeBy Sabin S. Chaudhary
    32. 32. • Sudan has been trying to boost exports of agriculturalproducts and livestock.Sudan: Share of agriculture in GDP Source: CIA factbookChallenge of TradeBy Sabin S. Chaudhary
    33. 33. • When investment activities carry with them labor-intensive components (building and construction).Chinese labor is largely involved.Challenge of TradeBy Sabin S. Chaudhary
    34. 34. Opportunities• China should serve as a Peace Broker for the conflictbetween the two Sudan countries to prevent full-fledgedwar▫ Reducing its arms shipments to the region▫ Human Rights• Market Expansion: Free Trade Zone for Agricultureproducts and livestock to boost bilateral transactions• Diversification into Mining such as goldBy Foster Abogye Gyamfi
    35. 35. Opportunities• Petrochemical Industry• Financial Institutions• Economic Infrastructure▫ Transportation System: Railway ($ 1.15bn)▫ Airport Expansion▫ Telecommunication▫ Sea Port Expansion• Capacity Building▫ Research Center▫ Education InstitutionBy Foster Abogye Gyamfi
    36. 36. Economic Gains• Oil Fees:▫ 2013 $500mn▫ 2014 $2bn• Transit for GoodsBy Foster Abogye Gyamfi
    37. 37. Conclusion• China helped addressed the issue of the oil fee impassebetween North and South Sudan primarily throughdiplomacy• China was the first country to supply troops to the UNMission in Darfur (UNAMID)• South Sudan is to receive US$8 billion loan▫ Earmarked for road, hydropower, infrastructure andagriculture projectsBy Foster Abogye Gyamfi
    38. 38. Conclusion• Sudan had served as bridgehead for China into Africa oilmarket• Sudan has been a major recipient of Chinese foreign aid,due to the good political relations between the twogovernments• What is your thought of China’s Trade as against HumanRights violations?
    39. 39. Reference• Energy Information Administration (EIA), “Sudan and South Sudan,”Country Analysis Briefs (updated March 19, 2012),http://www.eia.gov/cabs/Sudan/• www.thediplomat.com/china.../no-strings-attached-evaluating-chinas-trade- relations-abroad• International Crisis Group (ICG), “China’s New Courtship in SouthSudan,” Africa Report No. 186 (2012): 2• https://www.cia.gov/library/publications/the-world-factbook/geos/od.html• Riek Machar, “South Sudan: A History of Political Domination – A Caseof Self-Determination,” University of Pennsylvania – African StudiesCenter, (1995),http://www.africa.upenn.edu/Hornet/sd_machar.html;Peter Woodward, “Towards Two Sudans,” Survival: Global Politics andStrategy 52, No. 3(2011): 5.• Associated Press, “Sudan says it ran South Sudan troops out of border oiltown; South Sudan announces withdrawal,” Washington Post, April 20,2012By Foster Abogye Gyamfi
    40. 40. Thank you.

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