Upgraded high-end and expanded market, with confidence in long-term improvement of foreign trade. Xinhua News Agency | Economic Reference Report | Confidence

Xinhua News Agency, Beijing, August 9th (Xinhua) - The Economic Reference Daily published an article on August 9th titled "Rising End, Expanding Market, and Long Term Positive Foreign Trade with Confidence.". According to the article, data from the General Administration of Customs on the 8th showed that China's total import and export value of goods in the first seven months of this year was 23.55 trillion yuan, a year-on-year increase of 0.4%. Lv Daliang, Director of the Statistics and Analysis Department of the General Administration of Customs, stated that this data is in line with expectations, and the long-term positive fundamentals of China's foreign trade have not changed.

Data shows that since the second quarter, China's monthly import and export scale has remained stable at over 3.4 trillion yuan. In July, China's imports and exports reached 3.46 trillion yuan, which is at a relatively high level in the same period in history. Compared to the same period in 2019, it increased by 25.7%, which is 4.5% higher than the average for the same period from 2020 to 2022. Overall, China's foreign trade imports and exports have operated steadily.

The data also shows that in the first seven months, China's exports reached 13.47 trillion yuan, an increase of 1.5%; Imports amounted to 10.08 trillion yuan, a decrease of 1.1%; The trade surplus reached 3.39 trillion yuan, expanding by 10.3%.

Pang Ming, Chief Economist and Head of Research at JLL Greater China, stated that trade price factors have a significant impact on both exports and imports. The impact of factors such as global trade demand contraction on China's foreign trade is expected to continue to emerge in the coming months.

Peng Bo, a researcher at the International Trade and Economic Cooperation Research Institute of the Ministry of Commerce, stated that although facing various difficulties, there are still many favorable factors in China's current import and export development, with great potential.

Peng Bo analyzed that firstly, the overall trend of China's industry leaping towards the high-end of the global value chain is unshakable. From the data, the proportion of general trade imports and exports has increased. In the first seven months, the proportion of China's general trade imports and exports increased by 1.1 percentage points compared to the same period last year, while the proportion of processing trade decreased; Domestic enterprises maintain growth in imports and exports, and the endogenous driving force of foreign trade continues to strengthen; The increase in exports of electromechanical products and "new three samples" reflects this trend. "These are the biggest confidence factors for China's stable growth in foreign trade."

In addition, China's diverse and stable economic and trade relations continue to expand. ASEAN is China's largest trading partner. In the first seven months, the total trade value between China and ASEAN was 3.59 trillion yuan, an increase of 2.8%, accounting for 15.3% of China's total foreign trade value. Over the same period, China's imports and exports to countries along the "the Belt and Road" totaled 8.06 trillion yuan, up 7.4%; The import and export of the five Central Asian countries increased by 35%, maintaining a rapid growth trend; Growth of 5.5% and 7.4% respectively for Latin America and Africa.

This cannot be achieved without the assistance of continuously expanding the "circle of friends" of foreign trade. In June of this year, the Regional Comprehensive Economic Partnership Agreement came into full force for the 10 ASEAN countries and 15 member countries including Australia, China, Japan, South Korea, and New Zealand, marking a new stage in the comprehensive implementation of the world's most populous, largest economic and trade scale, and most promising free trade area.

Industry insiders analyze that the RCEP, combined with the bilateral free trade agreements already in effect between China and other RCEP members, creates favorable conditions for enterprises to better enjoy benefits, helps enterprises reduce trade costs, and brings tangible dividends and benefits to enterprises.

China is also constantly deepening bilateral and multilateral cooperation, including expanding the network of high standard free trade zones facing the world, promoting the construction of the "the Belt and Road" to go deeper and more practical, and comprehensively carrying out negotiations such as the China ASEAN Free Trade Area 3.0.

In the view of Xu Yingming, Director of the International Market Research Institute of the Research Institute of the Ministry of Commerce, these will provide more opportunities for Chinese enterprises to explore the market. "With the continued positive release of RCEP and the deepening of the construction of the the Belt and Road, RCEP member countries, countries along the the Belt and Road and ASEAN countries will become growth points of China's foreign trade development, which is expected to continue to grow in the future."

The data also confirms this trend. According to statistics from the China Council for the Promotion of International Trade, in the first half of this year, the total amount of RCEP origin certificate visas in the national trade promotion system was 3.324 billion US dollars, a year-on-year increase of 22.47%; The total number of visas was 96000, a year-on-year increase of 69.49%.

Sun Xiao, spokesperson for the China Council for the Promotion of International Trade, stated at a recent press conference that the stable growth in the number of RCEP certificate visas indicates that foreign trade enterprises are continuously increasing their enthusiasm for using RCEP, and using RCEP to export to related partner countries may become a new growth point for China's foreign trade. Meanwhile, there are also favorable factors such as the rapid development of new trade formats such as cross-border e-commerce.

Further strengthening these new growth points has become an important driving force for stabilizing foreign trade. The Ministry of Commerce, the General Administration of Customs, the China Council for the Promotion of International Trade and other relevant departments and institutions have stated that they will introduce measures to deepen cooperation, guide the cultivation of cross-border e-commerce brands and standard construction, and do everything possible to help enterprises cope with challenges such as weak international market demand, and fully promote the stability and quality of China's foreign trade promotion.

Local governments are also actively organizing foreign trade enterprises to "go out", bringing in overseas customers, continuously increasing their efforts to explore overseas markets, and supporting new formats and models. For example, Guangdong organizes the "Guangdong Trade Global" series of exhibitions and organizes economic and trade delegations to participate in and promote exhibitions around the world; Zhejiang continues to increase its support for the entry and exit of business personnel such as overseas exhibitors, overseas marketing, procurement in Zhejiang, and overseas investment; Guangxi encourages enterprises to participate in overseas exhibitions and prepares to organize activities such as the 2023 China Guangxi Commodity Expo and the "Guipin" Overseas Japan Station.

With policy support, the confidence of foreign trade enterprises has increased. Recently, the China Council for the Promotion of International Trade conducted in-depth research on more than 3100 foreign trade enterprises. According to research data, 75.1% of foreign trade enterprises expressed stable and relatively confident development in the third quarter of 2023. When asked about the favorable factors for the production and operation of foreign trade enterprises at present, 57.2% of foreign trade enterprises choose "overseas customers have always been stable", and 55.5% of foreign trade enterprises choose "the effectiveness of national stable foreign trade policies and strong support from local governments".

Looking ahead to the future, Sun Xiao believes that with the overall recovery of China's economy and the effectiveness of more practical and effective policy measures, the team of foreign trade enterprises will become stronger and their vitality will be further enhanced.

Pang Ming also stated that "with the support of a package of measures and the combined effect of countercyclical policies, it is expected that the resilience of import growth in the second half of the year will still be greater than that of exports, and the basic situation of foreign trade and foreign investment can be completely stabilized." He also pointed out that the free trade pilot zone and free trade port can connect with international high standard economic and trade rules, conduct pioneering experiments in more fields, and are also expected to further expand the overall increment space and structural optimization space while stabilizing the basic situation of stock.