Online Networking Creates Opportunities for International Trade in China
Today’s global economy resembles a network exchange structure, one in which is it extremely beneficial to be highly connected. As access to resources and development of products has become increasingly specialized, international trade plays an invaluable role in the state of any large country’s economy. In China, a company called Tradesparq has recently created a social networking site of sorts for global trade which matches overseas buyers with China-based suppliers. This technology provides suppliers and buyers on an international scale unprecedented opportunities to contact each other. According to article, Tradesparq facilitated approximately 1.2 million trade opportunities during its first year of operation. In addition to many inquiries from Western importers, “there was also a large amount of activity from African and Middle Eastern countries with 16% and 15% respectively followed by South East Asian countries at 13.5%”
While this increase in contact and connectedness is certainly a boost for the Chinese trade economy, it is interesting to note that such a form of trade networking provides opportunities for buyers in many developing countries in areas such as Africa, the Middle East, and South East Asia where it would typically be more difficult to initiate contact with Chinese suppliers. As we’ve seen in class, it is generally beneficial to be in a position in the network where you are connected to nodes that have a small number of other connections, and therefore are more dependent on you for trade. With Tradesparq, Chinese suppliers are place in a position of power where many buyers from less accessible areas of the world are vying for their business. As the article describes, “the developing country market continues to be a boon for Chinese exporters as the US and European economies remain sluggish.”
Who has more bargaining power here?
Thus, by reaching out to buyers with less access to other sources, China is expanding its economic base of power and forging a thriving international trade system that gives it more flexibility and influence on the market.
-tiger balm