“It is getting harder and harder to make money in foreign trade.” When asked about his deepest feelings in 2014, Xiao Junqing, general manager of a textile company in Wenzhou, said helplessly that due to cost pressure, foreign businessmen placed a large number of orders for textile products. The flow to ASEAN countries such as Vietnam and Bangladesh has become a trend.
Data can best reflect the problem. On January 13, the General Administration of Customs announced the 2014 import and export data. Although it was expected that the foreign trade growth in 2014 was not up to standard, people were still shocked when the data came out: In 2014, my country’s total import and export value was 26.43 trillion yuan, an increase of 2.3% over 2013. This is the third year that my country has failed to meet its foreign trade goals.
In the context of export slump, among the conceivable solutions, import expansion is imminent.
Hard-won
The import and export data in 2014 hit a new low in foreign trade growth in recent years. 2.3%, this data intuitively shows the huge decline in China’s foreign trade growth rate. Once upon a time, China’s foreign trade experienced rapid growth of 20-30% for many years, with the peak growth rate reaching 37.1%.
Zheng Yuesheng, spokesperson of the General Administration of Customs, explained that the reasons for “not meeting the standards” are relatively complicated. my country’s economic development has entered a new normal. At the same time, the pace of world economic recovery is slow, international market demand is sluggish, and the domestic economy is under great downward pressure. “Under such circumstances, it is indeed not easy to achieve such results.”
It is indeed not easy, this sentence seems familiar. As early as 2012, when the foreign trade target was not achieved for the first time, Ministry of Commerce spokesperson Shen Danyang also made a similar statement. The foreign trade growth target that year was 10%, but the actual growth was only 6.2%.
Don’t think this is an “excuse” from relevant departments. In recent years, the foreign trade industry has faced multiple factors such as insufficient external demand, rising comprehensive costs, poor external environment, and unstable exchange rates. Whether it is 6.2%, 7.6% (2013 foreign trade growth rate), or 2.3%. These are indeed hard-won.
Simply put, the total value of foreign trade exports is the product of export quantity and price, and both of these aspects are now encountering considerable difficulties. “The slowdown in export growth is in line with expectations.” Zhang Yansheng, a researcher at the National Development and Reform Commission’s Institute of Foreign Economics, said.
“As my country’s economic development enters a new normal, my country’s foreign trade has also entered a new normal characterized by stable growth, structural adjustment, and quality improvement.” Zheng Yuesheng said that the growth rate of foreign trade was significantly lower than expected, and the trade is in a period of It is related to the shifting period of speed increase.
Li Huiyong, chief macroeconomist of Shenyin Wanguo, told reporters that although the annual data is “unsatisfactory”, it is expected to be “better” this year. First, the U.S. economy is recovering and the international economy may pick up; secondly, after experiencing a cliff-like decline in oil prices last year, commodity prices may stabilize and rebound this year and remain stable, so the fluctuations will not be greater than in 2014.
Unsustainable
“The growth rate does not fully reflect some problems.” The person in charge of a footwear export company told reporters that the company’s export volume increased slightly in 2014, but its profits fell a lot. In terms of exchange rate, cost, etc. Under the influence of multiple problems, the price has to be constantly reduced. “The quotations in Southeast Asia are particularly low. If I cannot give the same quotation, the customers will run away.”
“Once I propose a price increase, they will immediately come up with a lower quotation.” Xiao Junqing also told reporters that the foreign businessmen’s price comparison caused them to suffer a lot of losses. What makes Xiao Junqing even more helpless is that the Ministry of Finance and the State Administration of Taxation have just raised the export tax rebate rate for some textiles in the past few days. Before they can enjoy the benefits of this policy, foreign businessmen have heard about it and asked him to further reduce prices.
At the “China’s Symposium on Moving towards a Trade Power” organized by the Ministry of Commerce, Vice Minister of Commerce Zhong Shan also told reporters present that the previous foreign trade growth method that relied on traditional volume and price growth was unsustainable. .
It can also be seen from the data released by the customs that the competitive advantage of my country’s labor-intensive products in the international market has been weakened. In the foreign trade data of 2014, traditional labor-intensive industries experienced a significant decline. The exports of seven major categories of labor-intensive products including textiles, bags, shoes, toys, and furniture were 2.98 trillion yuan, an increase of 4%. Accounting for 20.7% of the total import and export value that year. During the same period, the export of mechanical and electrical products was 8.05 trillion yuan, an increase of 2.6%, accounting for 56% of the total export value.
“A large part of any foreign investment is made by purchasing Chinese equipment. Now from the perspective of high-speed rail, thermal power, and hydropower, the cost performance of Chinese products is the best in the world, which is why some developed countries include This is why they all choose Chinese products.” Gao Hucheng, Minister of Commerce, recently pointed out that China has entered the era of capital export, and foreign investment will be combined with foreign trade.
Imports are bleak
What is also eye-catching is that in 2014, my country’s trade surplus reached 2.35 trillion yuan, a year-on-year expansion of 45.9%. Assuming that GDP this year can be the same as last year, then this year’s trade surplus will account for 3.6% of GDP, which will be higher than internationally recognized trade balance warning line (3%).
The main culprit for the rise in trade surplus is actually imports. system� shows that in 2014, my country’s exports were 14.39 trillion yuan, an increase of 4.9%; imports were 12.04 trillion yuan, a decrease of 0.6%.
In 2014, China’s imports of major commodities experienced an increase in volume and a decrease in price. According to calculations by the General Administration of Customs, the decline in global commodity prices last year lowered the growth rate of my country’s import value by 3.3 percentage points. After deducting the above price factors, the volume growth of China’s imported goods last year should have been 2.8%. Assuming that commodity prices remain unchanged last year, and the volume of imported goods increases by 2.8%, and based on the calculation that China’s import value also increased by 2.8% for the whole year, last year’s trade surplus will be less than 2 trillion yuan.
The issue of trade balance has always been the focus of high-level attention. At the end of 2014, the State Council of China also issued the “Several Opinions on Strengthening Imports”, aiming to promote the optimization of economic structure and the basic balance of imports and exports and the balance of international payments.
“Although from the perspective of pure data scale, my country’s trade surplus created a new high point in 2014, a simple high surplus is not the goal pursued by my country’s foreign trade.” Zheng Yuesheng emphasized that China has been paying attention Balanced, coordinated and sustainable development of foreign trade.
An official from the Ministry of Commerce revealed that the main reason for lower-than-expected foreign trade growth is weak imports. In 2015, the Ministry of Commerce will continue to encourage the expansion of imports and will introduce new policies.
