General

For the first time, the scale of China's foreign trade has exceeded the threshold of 40 trillion yuan. According to customs data, the scale of China's foreign trade hit a new record in 2022, with the import and export of goods reaching 42.1 trillion yuan. At the same time, the contribution rate of net exports of goods and services to GDP growth reached 17.1% in 2022. At the same time, the rising risk of global economic recession and the continued slowdown in the growth of foreign demand are still serious challenges for China's foreign trade. However, China's foreign trade has made great efforts to prepare, and foreign trade will also become an important support for China's accelerated economic recovery.

Stand at a new height

In 2022, the scale of China's foreign trade hit a new record. According to customs data, foreign trade in 2022 was better than expected, and the scale of foreign trade in the whole year hit a new record. The import and export of goods exceeded the 40 trillion yuan mark, reaching 42.1 trillion yuan, an increase of 7.7%. This is the first time that the scale of China's foreign trade has exceeded the threshold of 40 trillion yuan.

"Against the background of repeated epidemic prevention and control in China, global instability, and economic downturn, this achievement is remarkable." Peng Bo, a researcher at the Research Institute of the Ministry of Commerce, told the Beijing Business Daily, "The total import and export value of China breaking the 40 trillion mark will further increase the proportion of China in global foreign trade, enhance the externality of the economy, and expand the influence of China's economy in the world.", At present, China has maintained the status of the world's first trading country of goods for six consecutive years, and the international market share of exports has ranked first in the world for 14 consecutive years.

Looking back on 2022, the breakthrough in the scale of foreign trade has brought China's foreign trade to a new height. According to customs data, China's import and export volume will reach 42 trillion yuan in 2022, which is a new breakthrough over the ultra-high base in 2021. "While the scale is growing reasonably, the structure is also continuously optimized. The proportion of imports and exports of private enterprises has increased, and the proportion of exports has increased by 3.2 percentage points to 60.8%," Li Xingqian said, "Positive progress has also been made in bilateral and multilateral economic and trade cooperation. Exports to RCEP trading partners increased by 17.5% year-on-year, 7 percentage points higher than the overall growth rate. The proportion of imports and exports to the 'the Belt and Road' countries reached 32.9%, 3.2 percentage points higher than that in 2021."

Customs data show that at the same time, from a domestic perspective, foreign trade has made an important contribution to the overall recovery of economic operation. Li Xingqian said that in 2022, the contribution rate of net exports of goods and services to GDP growth reached 17.1%, driving GDP growth by 0.5 percentage points; There were 598000 foreign trade enterprises with import and export achievements, an increase of 31000 compared with 2021, which effectively promoted China's job stability and employment.

According to the customs data, "From the international perspective, against the backdrop of the turbulence of the global economic and trade environment, China has taken effective measures to stabilize production, stabilize exports and ensure the smooth operation of the global industrial chain supply chain. At the same time, we have actively expanded imports, with the annual import scale up to 2.7 trillion US dollars, making China's contribution to the global economic and trade development." Li Xingqian said.

Facing the test of weak external demand

Although new breakthroughs have been made in foreign trade, further breakthroughs may face multiple challenges. The latest World Economic Outlook report released by the International Monetary Fund (IMF) in Singapore on January 31 shows that the growth rate of world trade is expected to fall to 2.4% in 2023.

In 2023, the rising risk of global economic recession and the continued slowdown in the growth of foreign demand will still be a severe test for China's foreign trade. "The main contradiction in China's foreign trade sector has changed from the supply chain obstruction and the lack of contract fulfillment capability last year to the current weakening of foreign demand and the decline of orders, which is an important change," Li Xingqian said.

"The weakening of foreign demand throughout the year will be a high probability event. New export orders in January are still in the contraction range, and exports are likely to no longer be the driving factor as in the past three years," said Wang Jingwen, director of the Macro Research Center of China Minsheng Bank Research Institute.

Peng Bo also believes that China's exports are expected to decline in 2023. "The decline in the growth rate of the external market will intensify the fierce competition in the international market and increase the pressure on China's exports. In terms of Europe, the Russian-Uzbekistan conflict will continue and continue to intensify in 2023, and the European economy will further decline. Europe and the United States are the main export destinations of China's goods, and the economic decline in Europe and the United States will seriously affect China's exports," said Peng Bo, "But on the whole, it will also promote China's industrial upgrading, give full play to the advantages of China's entire industrial chain, and ensure that Chinese enterprises, commodities and industrial chains win in the international competition."

On the other hand, the import situation is more optimistic. Peng Bo said that in 2023, China's domestic economy will be affected by the epidemic, economic and other policy optimization, and both investment and consumption will rise significantly, which will greatly promote imports. "In addition, the global economy will be weak in 2023, and local conflicts will spread or intensify, which will affect the decline of commodity prices and also help stimulate imports." Peng Bo said, "The optimistic prospect of imports is also conducive to the backflow of orders transferred to Southeast Asian countries in the past few years. According to the principle of proximity, production should be closer to the final market. The expansion of the Chinese market is conducive to multinational enterprises to rearrange production to the Chinese Mainland."

However, Peng Bo also pointed out that in the short term, the transfer of some orders to Southeast Asian countries has a certain negative impact on China, but in the long term, it is conducive to the optimal allocation of China's industrial structure and the upgrading of China's industry, which will further strengthen the position of China's industry in the global value chain.

Break the situation against the current and have confidence

"The global economic downturn and the containment of the United States will be the biggest resistance to China's trade development in 2023. In addition, the world will still be deeply volatile in 2023, and the conflict will cause great damage to the global industrial chain supply chain." Peng Bo said, "China's domestic market and the advantages of the entire industrial chain are an important guarantee for China to resist the international situation, and also conducive to promoting the adverse development of China's foreign trade."

To break through the resistance and develop against the trend, China has already started to prepare. Li Xingqian said that next, in terms of foreign trade enterprises, domestic trade exhibitions will be promoted to resume offline exhibitions in an all-round way, and a series of key exhibitions, such as the China International Fair for High-tech Achievements, the Canton Fair and the China International Fair for High-tech Achievements, will be held well. And promote the further development of cross-border e-commerce, overseas warehouse and other new business forms that have developed rapidly in recent years, fully utilize digital means to tap the trade potential, and drive the export of small and medium-sized foreign trade enterprises.

In terms of tapping foreign demand, which has attracted wide attention, Li Xingqian also pointed out that he will play the role of business institutions of embassies and consulates abroad and assist local organizations to organize enterprises to carry out trade cooperation abroad. "We should strengthen the research of international market segments, share the supply and demand information of the markets of various countries in a timely manner, and help enterprises to obtain foreign trade orders in a timely manner." Li Xingqian said, "We will also support enterprises to 'go out', provide more convenience for cross-border business exchanges of foreign trade enterprises, support enterprises to promote Chinese products, Chinese manufacturing, Chinese brands in various ways, and support the expansion of overseas exhibition scale where conditions permit."

In addition, the Ministry of Commerce will also work closely with its trading partners, give full play to China's super-scale market advantages, expand the import of high-quality products from all countries, stabilize the global trade supply chain, stabilize the industrial base of foreign trade, continue to optimize the industrial structure of foreign trade, and support the gradient transfer and upgrading of processing trade to the central and western regions and the northeast regions while strengthening the general trade.

On the whole, Wen Bin, chief economist of China Minsheng Bank, said that looking forward to the whole year of 2023, although there are still many factors that exceed expectations, China's economic recovery will continue to improve. "As the impact of the epidemic continues to subside, the policy effect continues to release, and market confidence gradually improves, the foundation of recovery will continue to be consolidated."