Analysis of geographical orientation of foreign trade in China based on culture distance

According to relevant data, we can obviously tell that the leading regions in our foreign trade geographical orientation are the United States, Japan and EU countries. More than half quota of the foreign export is in these areas. Yet, with the development of our international trade, the disadvantages of solely relying on the traditional markets are showing up. Thus, the scientific regulation of the development path of our foreign trade is closely connected with the analysis of geographical orientation. This paper is to testify the result that culture distance is bound to influence that trade cost through its mechanism. As a result, this paper selects relevant indexes and establishes three models to conduct regression analysis. According to the test results, there is a negative correlation between culture distance and our geographical orientation. In the future, we could put part of the foreign trade quota into some potential developing countries like Latin America, so that the pattern of our foreign trade market can be perfected.