ABSTRACT
Since the mid-1980s, China’s international linkages have grown noticeably. The acceleration of foreign direct investment (FDI) is one feature of this development. Another indicator is the strong increase in external trade relations. Much emphasis has been given to trade and FDI linkages within the Asian region. This is logically due to the fact that, during the 1980s and 1990s, intra-regional development outweighed the development of extraregional ties. The increase in the Asian intra-trade figure is the result of regional integration, driven by the liberalization of the external sector and the impressive growth figures of the Asian economies. For example, intraregional trade within East Asia increased from 33 per cent in 1980 to 46 per cent in 1995 (Asian Development Bank, 1999). In addition, intra-regional FDI flows have contributed significantly to the deepening of regional economic interdependencies and the market-driven integration in the region.
