China’s foreign trade offers stability to world economy

Note: The following article is taken from the Chinese-language "Commentaries on International Affairs."

China’s foreign trade maintained stable growth in the first three quarters of this year by expanding 2.8 percent over the same period last year, according to new figures from the country’s General Administration of Customs, released on Monday. The results reflect the resilience and vigor in the Chinese economy against the backdrop of a global trade slowdown.

A Home Textile International Expo held in East China’s Jiangsu Province in late September, 2019, attracted more than 5,000 exhibitors and purchasers from over 50 countries and regions. [Photo: IC]

Against the headwinds of unilateralism and protectionism, international organizations have shown concern over the gloomy global trade outlook. Earlier this month, the World Trade Organization more than halved its growth forecast for trade in goods this year from 2.6 percent to 1.2 percent, much lower than the 3 percent growth rate last year. Kristalina Georgieva, the new chief of the International Monetary Fund, has recently said that global trade growth has come to a near standstill. Last month, a report issued by the United Nations expected international trade growth to slow down to 2 percent this year.

Against such a backdrop, China’s foreign trade not only maintained stable growth, but also realized quality improvement in the first three quarters. This can be seen in three respects.

China's import and export structure continues to optimize itself. In the first nine months, China's higher value-added imports and exports increased by 4.8 percent year-on-year, accounting for nearly three-fifths of the total value of foreign trade. Imports of consumer products such as seafood, cosmetics and fruit enjoyed a growth rate ranging from 35 percent to 42 percent, which reflects the big potential in the domestic consumption market. In the meantime, the export volume of machinery products, which account for nearly 60 percent of China’s export value, grew by 4.7 percent in the period, providing evidence that China's industrial transformation and upgrading is further accelerating.

China's import and export market is becoming increasingly diversified. In the first nine months, China’s imports and exports to major markets such as the European Union and ASEAN increased by 8.6 percent and 11.5 percent respectively. The growth rate of trade with the "Belt and Road" countries was 6.7 percentage points higher than the overall growth rate, accounting for nearly 30 percent of China’s total foreign trade value, which is considered to be a big highlight. Increased market diversification has greatly helped enhance the ability of Chinese enterprises to weather risks.

Another highlight is that private enterprises continue to be an important driving force in China's foreign trade. In the first three quarters, the import and export of private enterprises increased by over 10 percent, accounting for 42.3% of total foreign trade, indicating that endogenous momentum of foreign trade has seen a continuous enhancement.

Foreign trade is a key indicator of a country’s economic development. China’s achievement in foreign trade against the global headwinds in the past three quarters has provided plentiful evidence that the country’s economy remains resilient, steady and energetic. It’s guaranteed by the consumption upgrading in a market with 1.4 billion consumers. It’s also helped by the government’s policies to reduce taxes and fees and streamline the business environment, which has stimulated the vitality of enterprises.

The world is still facing many uncertainties in global growth. Foreign trade in major economies is under pressure on different levels. China’s relatively fast growth in import and export in the first nine months provides strong support to a steady increment throughout the year, which will make the country an important stabilizer of global growth.