The strong growth of Chinese exports can impact an economy not only through intensifying competition in the domestic market, but also in foreign markets. In fact, in the recent past, the large export market share gains of China in low-technology, low-skill products, like textiles, clothing, footwear, and electric appliances, were accompanied by losses in the export shares of several countries, including Portugal.

In the period 1993-2008, Portuguese workers in industries more exposed to this indirect competition from China saw their total cumulative wages and employment fall when compared to similar workers in less exposed industries. Some particular groups of workers were more affected by the Chinese competition in international markets, namely women, older and less educated workers. In the last years, the effects of Chinese competition in third-country export markets should have become more comprehensive, given the growing sophistication of China’s exports, which now compete in virtually all industries in which developed economies operate. Analyses that allow for a differentiation of the effects of trade are essential for public policies aimed at supporting workers affected by globalisation.