General

What situation will international trade enterprises face this year? The Ministry of Commerce said recently that since 2023, the global economic and trade situation has become extremely severe and the downward pressure has increased significantly. The main contradiction in China's foreign trade field has changed from the supply chain obstruction and the lack of contract fulfillment ability last year to the current weakening of foreign demand and the decline of orders. To this end, the Ministry of Commerce will intensify efforts to stabilize foreign trade by resuming physical exhibitions, making good use of new business forms, exploring new needs, and supporting enterprises to "go global".

For the majority of international trade enterprises, on the one hand, they should make full use of relevant policies to continue to expand the international trade market, on the other hand, they should also focus on the domestic market and complete the transformation of domestic and foreign trade integration. This is not only the best way to deal with the instability of the current international political and economic structure, but also the key to enhance the international competitiveness of enterprises. In recent years, with the process of building a new dual-cycle development pattern, China has been opening up to the outside world in a wider range, in a wider field and at a deeper level, and has been accelerating the construction of a unified national market to promote common prosperity, placing the expansion of domestic demand in an important position. All these have provided a good domestic market environment to continuously meet the transformation and upgrading needs of foreign trade enterprises. Foreign trade enterprises should also actively respond and continue to accumulate new international energy in expanding domestic demand.

For a long time, whether in the political, academic or business circles, when talking about the rise of "Made in China", they often refer to comparative advantages. This is the result of China's active undertaking of international industrial transfer in a good international environment, relying on its low land and labor prices. Another explanation for the rise of "Made in China" is the global value chain theory. According to Xing Yuqing, the author of The Mystery of China's Export: Decoding the "Global Value Chain", the rise of "Made in China" also benefits from China's integration into the global value chain, and from the spillover benefits of the global value chain, China has cultivated a number of competitive foreign trade industries.

In addition to the above two explanations, a theoretical explanation derived from the factors of the Chinese market itself is coming to the forefront and being recognized by more and more people, which coincides with the strategy of expanding domestic demand. Guo Bin, a professor at the School of Management of Zhejiang University, put forward the catch-up ladder theory in his book "Made in Great Countries: Genetic Advantages and Future Changes of Made in China", one of which is the market ladder. China's market not only has a large population, but also has diversity. It has the characteristics of low end, middle end and high end, that is, there is a market ladder. More importantly, this market ladder is continuous and can provide enough space for enterprises to rise or fall, thus helping the rise of "Made in China". This continuous market ladder can not be owned by any country. This is also one of the important reasons why India, Brazil and other countries, which are also large population countries, have not become big manufacturing countries.

As we have experienced, the current global political and economic situation is unstable, the United States is trying to achieve "decoupling and chain breaking", and the exports of Southeast Asian countries are soaring, which makes us have to worry about where "Made in China" will go in the future. Now, the key to this question is whether "Made in China" can be supported by a huge domestic market, and whether international trade enterprises can maintain their advantages in the fierce domestic market competition.

From the standpoint of building China into a trade power, it is also necessary to expand domestic demand. From the perspective of the development of foreign trade in the United States and other developed countries, the major exporter is not necessarily a trade power, but the major importer must be a trade power. There are two main reasons for this. First, a large amount of foreign exchange needed by the country to import comes from high value-added export products and services. High value-added export is one of the conditions for a powerful trading country; Second, in today's increasingly diversified, personalized and customized demand, the buyer has the right to speak. Further, the right to speak for the formulation of standards is also in the demand side. In addition, for China, it is not only to actively expand imports, but also to enhance the voice of Chinese enterprises with the gradual promotion of RMB internationalization. It can be seen that China's accelerated construction of a new development pattern and expansion of domestic demand are considered from a long-term perspective, and are not an expedient measure to deal with the uncertainty of the current international environment.

In fact, the "the Belt and Road" initiative and the new development pattern of double circulation have been put forward successively, marking a major change in China's way of participating in globalization. China has changed from a single "world factory" to a dual identity of world factory and world market. This means that no matter what industry the enterprise is engaged in and how large the enterprise is, even if it does not go abroad, it will also face global competition. Based on the domestic market, it will become the basis of the internationalization and globalization of enterprises, and the integration of domestic and foreign trade of enterprises will become the norm. How to continuously improve the competitiveness of the domestic market will become a current issue for China's foreign trade enterprises, which must be considered from a higher strategic perspective.

We often say that China is the only country in the world with all industrial sectors, which has laid a solid foundation for "Made in China" to improve its international competitiveness. If the Chinese government and enterprises can work together to continuously expand the opening up, vigorously promote common prosperity, and deeply tap the potential of domestic demand, and if Chinese international trade enterprises can apply the ability they have developed in the domestic market freely, the internationalization of "Made in China" will go wider and farther.