China to foster new drivers for foreign trade

By Luo Shanshan, People’s Daily
Foreign trade is an important engine driving economic growth and a crucial link between domestic and international economic circulations. China’s 2023 Central Economic Work Conference recently emphasized the need to foster new drivers of foreign trade. And how will China do this in 2024?
Foreign trade involves both domestic and international markets, and to consolidate the foundation of foreign trade and foreign investment, it is necessary to first clarify the domestic and international situations.
“The unstable momentum and insufficient driving force of the global economic recovery have led to sustained weakness in external demand, which is the main factor affecting the trend of foreign trade,” said Li Xingqian, director general of the Department of Foreign Trade of China’s Ministry of Commerce.
He believes China needs to fully recognize the difficulties and challenges facing the development of foreign trade, and also see that positive factors of stabilization and improvement are gathering.
Specifically, there is abundant potential in new products and new business forms. The new “three major ones,” namely solar batteries, lithium-ion batteries and electric vehicles, as well as energy storage products meet the need of global energy development. New business forms and models such as cross-border e-commerce, overseas warehouses, and bonded repairs are flourishing.
Chinese foreign trade possesses enduring innovation capabilities and a stable, efficient, and resilient supply chain, which will continue to provide new drivers for the recovery and growth of the national economy and global recovery.
To cultivate new drivers for foreign trade, it is important to focus on key tasks. “China has been the world’s largest exporter of intermediate goods for 12 consecutive years, with intermediate goods contributing nearly 60 percent to the growth of foreign trade,” said Li.
Expanding intermediate goods trade conforms to the trend of international trade development and is a mutually beneficial move, he added.
It is necessary for China to further strengthen cooperation with its trading partners and meet their realistic demand for developing manufacturing industry, so that it can achieve complementary advantages and provide impetus for global economic recovery.
Zhu Siqiao, associate researcher at the Chinese Academy of International Trade and Economic Cooperation, believes that cross-border e-commerce, as the fastest-growing, most potential, and most influential new form of foreign trade, is becoming an important trend in international trade development.
Currently, cross-border e-commerce accounts for over 7 percent of China’s total exports. The sector has over 100,000 entities, more than 200,000 independent platforms, and over 1,500 overseas warehouses covering an area of nearly 19 million square meters.
Li said that in order to expand cross-border e-commerce exports, policies regarding customs clearance, taxation, foreign exchange, and other aspects will continue to be improved to enhance regulatory facilitation and help companies reduce costs and increase efficiency.
Support will also be provided to encourage cross-border e-commerce pilot zones, industry organizations, and companies to participate in Silk Road E-Commerce and Belt and Road cooperation.
To cultivate new drivers for foreign trade, it is also important to promote the digitalization and green development of trade, consolidate the foundation of foreign trade and foreign investment, and accelerate China’s transformation into a trader of quality.
According to China’s Ministry of Commerce, it will together with local and other departments, continue to effectively implement various policies already introduced to stabilize foreign trade. At the same time, in light of new circumstances and tasks, it will make new policies and measures, and roll them out in a timely manner, to help foreign trade companies reduce costs and increase efficiency.