Do pilot free-trade zones boost China's export resilience amid Sino–US trade frictions?

Purpose Since 2018, the escalation of Sino–US trade frictions has placed China's external trade stability under unprecedented pressure. Against this backdrop, pilot free-trade zones (FTZs) have been positioned as a key policy instrument for sustaining resilient trade growth. Therefore, it is necessary to evaluate the role of free-trade pilot zones in export resilience. Design/methodology/approach Using panel data covering 274 Chinese cities from 2011 to 2021 and a multi-period difference-in-differences (DID) design, this article evaluates whether – and through which channels – the establishment of FTZs enhances export resilience. Findings The findings are fourfold. (1) FTZ designation significantly and robustly strengthens city-level export resilience; the result survives a battery of placebo tests, alternative resilience measures and an instrumental-variable strategy that addresses potential endogeneity. (2) The effect is heterogeneous: it is stronger in the eastern coastal region and in cities that are initially endowed with superior human capital, technological capacity and industrial sophistication. (3) Mechanism analysis reveals that the FTZ-induced improvement in export resilience operates primarily through accelerated technological innovation, skilled-labor agglomeration and industrial upgrading, and these effects are more pronounced in areas with higher economic development. (4) Importantly, the resilience-enhancing effect remains intact even after the outbreak of Sino–US trade tensions, indicating that FTZs serve as a buffer against external shocks. Originality/value These results provide rigorous evidence that FTZs bolster export resilience, offering actionable insights for the design of high-standard opening-up policies.

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Publication Details

Journal
China Agricultural Economic Review
Published
2026-05-19
DOI
https://doi.org/10.1108/caer-08-2025-0408
Primary Topic
Regional resilience and development
Type
article
Field-Weighted Citation Impact
0.00
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article

Do pilot free-trade zones boost China's export resilience amid Sino–US trade frictions?

S.L. Liu, Chenyao Suo, Xinru Chen, Fengting Wang et al.
China Agricultural Economic Review
Regional resilience and development
article

Do pilot free-trade zones boost China's export resilience amid Sino–US trade frictions?

S.L. Liu, Chenyao Suo, Xinru Chen, Fengting Wang, Weiguang Wu
article en

Abstract

Purpose Since 2018, the escalation of Sino–US trade frictions has placed China's external trade stability under unprecedented pressure. Against this backdrop, pilot free-trade zones (FTZs) have been positioned as a key policy instrument for sustaining resilient trade growth. Therefore, it is necessary to evaluate the role of free-trade pilot zones in export resilience. Design/methodology/approach Using panel data covering 274 Chinese cities from 2011 to 2021 and a multi-period difference-in-differences (DID) design, this article evaluates whether – and through which channels – the establishment of FTZs enhances export resilience. Findings The findings are fourfold. (1) FTZ designation significantly and robustly strengthens city-level export resilience; the result survives a battery of placebo tests, alternative resilience measures and an instrumental-variable strategy that addresses potential endogeneity. (2) The effect is heterogeneous: it is stronger in the eastern coastal region and in cities that are initially endowed with superior human capital, technological capacity and industrial sophistication. (3) Mechanism analysis reveals that the FTZ-induced improvement in export resilience operates primarily through accelerated technological innovation, skilled-labor agglomeration and industrial upgrading, and these effects are more pronounced in areas with higher economic development. (4) Importantly, the resilience-enhancing effect remains intact even after the outbreak of Sino–US trade tensions, indicating that FTZs serve as a buffer against external shocks. Originality/value These results provide rigorous evidence that FTZs bolster export resilience, offering actionable insights for the design of high-standard opening-up policies.

China Agricultural Economic Review
University of International Business and Economics (CN), Huazhong Agricultural University (CN), ZheJiang Academy of Agricultural Sciences (CN)
Openalex Percentile: Top 2%
Regional resilience and development
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