General

The World Economic Outlook report released by the International Monetary Fund (IMF) shows that global economic growth is expected to slow to 2.9% in 2023 from an estimated 3.4% last year. According to a report from the World Trade Organization (WTO), global commodity trade may only grow by 1% in 2023, far below the 3.4% previously predicted, which will exacerbate the risk of global economic recession. In 2022, China's foreign trade withstood multiple pressures that exceeded expectations and achieved stable growth. Faced with the challenges of rising risks of global economic recession and weakening external demand, how will China's foreign trade decompress this year?

On February 22nd, at the China Macroeconomic Forum (CMF)'s Symposium on Macroeconomic Hotspot Issues (the 60th issue), Liang Ming, Director of the Institute of Foreign Trade Research, Research Institute of the Ministry of Commerce, said, "Under the simultaneous impact of the supply side and the demand side, China's international trade exports significantly decreased year-on-year in the fourth quarter of last year, but there was a year-on-year decline on a monthly basis. From a historical perspective, it is not a rare phenomenon, but a normal fluctuation in foreign trade. The year-on-year decline in a single month is a cyclical dislocation effect, which does not mean that the future trend will deteriorate. In addition, based on the overall situation analysis, the advantages and competitiveness of China's foreign trade have not changed, and in the long-term "Good trends will not change."

Wang Xiaosong, a professor at the School of Economics at Renmin University of China and a major member of the China Macroeconomic Forum (CMF), analyzed that in 2023, China's foreign trade was facing adverse factors such as a recession in the world economy, weak external demand, an increase in the number of protectionist measures, and the continued negative impact of the epidemic on trade. "However, it should also be noted that the superposition of the construction of the 'the Belt and Road' and the implementation of RCEP is conducive to the development of regional trade. The solid foundation of the manufacturing industry, its deep integration into the global value chain, and the sufficient R&D investment in key industries are favorable factors for China's foreign trade development."

In the view of Cheng Shi, chief economist of ICBC International, although the negative effects of anti globalization are still being released, which will bring pressure on China's international trade imports and exports, China's trade as a whole remains relatively resilient and is expected to continue to assume the role of "stabilizer" of globalization.

Liang Ming holds the same view on this, and his confidence is that "the growth of demand in the international market is slowing down, not the total volume. Currently, the demand in the international trade market is a structural slowdown, not a total decline. This year, we will do some structural development work well, and there is still very large room for our international trade import and export."

Wang Xiaosong proposed the path for China's foreign trade to achieve a breakthrough in 2023:

Take full advantage of the policy dividend of RCEP. Promote the implementation of RCEP related measures nationwide; Upgrade the regulatory operating system, standardize and simplify procedures, continuously optimize customs clearance processes, improve customs clearance efficiency, and reduce customs clearance costs; Service enterprises seize opportunities for RCEP, make full use of various preferential policies, and help enterprises explore the RCEP market; Improve trade facilitation measures for RCEP.

Exploiting the potential of low-carbon and environment-friendly high-tech industries. China has advantages in research and development and commercial application scenarios in fields such as renewable energy, electric vehicles, and the digital economy, and is expected to take the initiative in carbon neutral trade in the global energy transformation. New energy vehicles, solar cells, and other industries have become highly competitive globally. In the future, it is necessary to take this opportunity to further tap the trade potential of low-carbon and environment-friendly high-tech industries.

Attach importance to the driving role of new business forms and models. In the future, we will focus on six new business forms and models, including cross-border e-commerce, market procurement, comprehensive foreign trade service enterprises, bonded maintenance, offshore trade, and overseas warehouses, distinguish similarities and differences, and formulate practical, effective, and proactive policies and measures by category. We should support the use of new technologies and tools to empower foreign trade development, improve cross-border e-commerce development support policies, and cultivate a number of outstanding overseas warehouse enterprises. Optimize the policy framework for market procurement trade, support more market entities to conduct foreign trade, and promote the transformation and upgrading of traditional international trade.

Improve the business environment to welcome industrial transfer. The outward migration of some manufacturing industries in Europe is mainly a natural process of the fifth industrial transfer, and the European energy crisis has played an accelerating role to some extent. Rising energy prices will accelerate the transfer of European related industries to China in the short term, mainly through trade, supplemented by investment. In the long run, industrial transfer is conducive to the release of domestic demand for intermediate goods, the upgrading of related industries, and the re matching of production capacity, as well as the improvement of China's "competition and cooperation" supply bargaining power. The Chinese government should enhance the transparency and predictability of policies, improve the business environment, further improve the technical level of relevant industries, and be ready to undertake industrial transfer.

Cheng Shi specifically proposed that the Greater Bay Area of Guangdong, Hong Kong, and Macao is one of the regions with the highest degree of openness in China. It should be used as a platform to tap the new potential of China's foreign trade, promote strong chain complementation, and accelerate the integration of industrial chains and supply chains. Grasp the leading enterprises, especially the leading technology enterprises in the Greater Bay Area, and use the "spillover effect" of technology and knowledge in the industrial chain to drive the technological upgrading and structural optimization of the entire industrial chain, so as to build an industrial cluster with international influence in the Greater Bay Area. Cultivate specialized and specialized new "small giants" enterprises, activate the vitality of small and medium-sized enterprises in the industrial chain, promote the evolution of enterprises towards specialized and specialized new directions, optimize the industrial layout, and enhance the resilience of China's industrial chain.