General

After the opening up of the epidemic, what people most expect is the recovery of the domestic economy. According to relevant experts and departments in China, the key to driving economic growth in 2023 is domestic consumption. However, the rapid growth of domestic consumption will essentially exclude some foreign trade orders.

Therefore, the topic of the loss of foreign trade orders in China was once on the hot search list, and among these lost orders, high, middle, and low end market orders were among them. So why on earth did this happen? Where has our foreign trade order gone? How should China prescribe the right medicine to the case? Let's continue to look down.

1、 Loss of foreign trade orders

Since October 2022, China's total import and export value has been declining for three consecutive months. In October 2022, China's total import and export value decreased by 0.4% year-on-year, and its exports also decreased by 0.3% year-on-year. Nowadays, China has implemented the policy of liberalization, and it is reasonable to say that foreign trade orders should increase, but the fact is that all the high, middle, and low end markets in China have fallen behind. So why have our orders decreased?

Reason 1: Decrease in foreign demand

The amount of foreign trade depends largely on the demand of the international market. The current decline in orders is due in large part to weak external demand and insufficient international orders. Due to the impact of the epidemic, today's world economy as a whole is developing downward. Even in developed countries such as Europe and the United States, where economic strength was originally high, the purchasing power of their citizens was also constrained.

Therefore, their demand for Chinese goods has greatly decreased, which has led to a decrease in orders in China from the source, and subsequently triggered the failure of the high, middle, and low end markets in China. However, foreign demand is not only affected by the economy, but their reduced demand for Chinese goods may also be due to finding new commodity suppliers.

For example, China used to export fitness equipment mainly from Taiwan, but now foreign orders have been gradually transferred to regions such as Mexico. The reason is also very simple, that is, because the local production environment is poor and labor costs are very low. In the context of a sluggish environment, foreign companies are also seeking ways to reduce costs. However, this is just an example. In addition to fitness equipment, some high-end markets have gradually shifted to countries with lower production costs such as the Philippines and India.

Reason 2: China's economy has not yet fully recovered

One important reason for implementing the liberalization policy is to increase domestic economic growth. However, it is not long since China's opening up, and it is still difficult for Chinese foreign trade enterprises to participate in various overseas exhibitions in a timely manner. Therefore, there is no way to open up new customers and undertake new international orders in a short time.

Moreover, relevant departments have clearly stated that the focus of domestic economic recovery is domestic consumption, which represents a slight neglect of the foreign trade industry. So under such circumstances, how does China respond to the situation?

2、 Methods for Saving the Loss of Foreign Trade Orders

Method 1: Open up surrounding markets

Chinese people often say that distant relatives are not as good as close neighbors, and so is economic development. Currently, ASEAN, which is relatively close to China, is China's largest trading partner. In the first ten months of 2022, the total trade value between China and ASEAN increased by more than 15%.

This means that China has made it clear that the future ASEAN will be our main partner in the foreign trade market. Therefore, if we want to save the loss of foreign trade orders, we can start from surrounding markets. Opening up the surrounding markets and stabilizing China's foreign trade orders is the right remedy for the situation.

Method 2: Assist the development of relevant enterprises

As mentioned above, due to the impact of the epidemic, it is still difficult for relevant Chinese enterprises to participate in various overseas exhibitions. Therefore, in the subsequent process of increasing orders, relevant departments can assist enterprises in successfully participating in outreach. Let enterprises play the role of stimulating foreign customers to increase orders, which not only helps the development of relevant enterprises in China, but also solves the problem of insufficient foreign trade orders in China.

Method 3: Support cross-border e-commerce

As is well known, China is a country with an extremely fast development in the e-commerce industry, so China has an advantage in the e-commerce industry. In 2021, China's cross-border e-commerce import and export scale reached 1.92 trillion yuan. Therefore, if you want to increase foreign trade orders, relevant departments can choose to vigorously support cross-border e-commerce, such as online Amazon, Alibaba International Station, and other well-known platforms.

It is worth mentioning that the total number of comprehensive experimental zones for cross-border e-commerce in China has now reached over 100. If the future can still flourish, then increasing foreign trade orders is not a problem. In general, the increase in foreign trade orders in China requires the assistance of relevant departments and the efforts of foreign trade enterprises and cross-border e-commerce entities.

3、 Summary

To stabilize the international economic position, import and export trade is very important. Although boosting domestic consumption is the main goal after the epidemic has been liberalized, foreign orders are very important for the long-term development of our economy and cannot be ignored. Therefore, in order to stimulate the growth of foreign trade orders, domestic entities and relevant national departments should also work together to make contributions to China's economy.