The effect of fluctuations in bilateral relations on trade: evidence from China and ASEAN countries

This article uses the gravity model and a novel method of analysis, based on massive event data from the Global Database of Events, Language, and Tone (GDELT), to empirically analyze the impact of fluctuations in bilateral relations between China and ASEAN on bilateral trade from January 2001 to December 2020. Analysis of 1,204,126 event records concluded that improved bilateral relations benefited trade. China's export trade was more easily influenced than its import trade. China's one-way reaction to ASEAN had a greater impact than ASEAN's one-way reaction to China. China's trade dependence with most ASEAN countries shows steady growth, and trade relations are positive. The authors suggest maintaining stable political ties, enhancing mutual understanding, and strengthening economic and political connectivity.

Yuren Wang, Yitao Tao