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Last updated at: (Beijing Time) Monday, October 28, 2002

China's Foreign Trade Sets New High Despite Adverse Circumstance

In August this year, the Canadian Federal General Administration of Taxation announced giving the market economic status to the four Chinese enterprises involved in the windshield anti-dumping case. This is the first anti-dumping case raised by foreign country but won by China since its entry into the WTO, but this was only an example showing that Chinese foreign trade has comprehensively begun operating in accordance with international trading rules.


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In August this year, the Canadian Federal General Administration of Taxation announced giving the market economic status to the four Chinese enterprises involved in the windshield anti-dumping case. This is the first anti-dumping case raised by foreign country but won by China since its entry into the WTO, but this was only an example showing that Chinese foreign trade has comprehensively begun operating in accordance with international trading rules. This case indicates that Chinese enterprises have begun to use international trading rules to breakthrough trading barriers, thus opening up wide-ranging space for the massive advance of their own products into the international market.

Growth under Adverse Circumstance Makes China's Trade a Unique Thriving Sector
According to the news from the 92nd Guangzhou Commodities Trade Fair held not long ago, between January and September this year, the total import and export trade volume of China reached US$445.135 billion, up 18.3 percent over the same period last year, of which export came to US$232.564 billion, up 19.4 percent. Under the circumstance wherein the world economy and trade generally remained low, China's export trade maintained a good momentum of growth that made it the unique thriving trade.

As long as one has a slight understanding of the current world economic situation, one will discover the implication of China's foreign trade statistics in the first nine months. Since the eruption of the Asian financial crisis in 1997, the global economic situation has deteriorated, after the "September 11" terrorist attacks on the United States, the wold economy witnessed frequent problems, giving a complete show of its weakness. Economists have warned, the global economy has given the red light, the economic growth rate in the next few years will probably remain at a low level.

Under such circumstances, international trade will undoubtedly sustain enormous impact. It is predicted that it will be hard for China, a new WTO member, to escape the harm. But what the reality shows is just the opposite, under the slow growth of the world economy, China's foreign trade still grows despite the adverse circumstance. It is forecast that China's import and export trade volume is expected to exceed US$600 billion this year, and there may possibly be breakthrough in China's standing as the sixth trade power in the world.

China Leads the World in Attraction of Foreign Capital
What's the reason for China's foreign trade becoming a unique flourishing sector? While being interviewed by mass media recently, Shi Guangsheng, minister of Foreign Trade and Economic Cooperation (MOFTEC), pointed out that in recent years, the central authorities have formulated many relevant policies encouraging the expansion of export in conformity with national conditions as well as with world trade rules, these policies are the prerequisite and foundation for the achievement of all successes. In addition, China's entry into the WTO has also yielded positive effect and has increased international capital's confidence in investing in China.

The latest global transnational direct investment confidence index report from the world's largest enterprise strategic management consultant company in September this year shows: Under the circumstance of the shrinking scale of international direct investment, China has entered the rapid growth period in terms of attracting foreign direct investment (FDI). Data in the first eight months of this year show that China has outdone the United States for the first time to become the destination country with the greatest attraction to FDI. Experts predict: On the basis of this growth rate, China's actual utilization of foreign capital in the whole year is expected to top US$50 billion for the first time.

Figures from the National Bureau of Statistics (NBS) also indicate that since the 15th National Congress of the Party, China's actual use of foreign capital has hit US$220.4 billion, the average scale of foreign-invested projects has shot up from over US$12 million in the early 1980s and over US$1.3 million in the early 1990s, up to US$3 million since the 15th Party National Congress.

At the same time, the structure of foreign capital absorbed has been constantly optimized. The proportion of the export by foreign-invested enterprises to China's total export volume increased from 9.4 percent in 1989 to 50 percent in 2001; the focus of foreign investment has developed from ordinary manufacturing industry to basic industries, infrastructure and high and new technological industries; after China opened the service trade field, commerce, foreign trade, telecommunication, finance, insurance and other service industries have become the hot spots of a new round of foreign investment; large transnational corporations are active in investing in China, over 400 of the world's top 500 companies have come to invest in China in more than 2,000 projects and have set up nearly 400 R&D centers of various types in China. The proportion of the export by foreign-funded enterprises set up in China by transnational corporations to China's total export rose from 17 percent in 1991 to 50 percent in 2001. Active investment has enlivened China's manufacturing industry, thereby boosting the growth of export trade.

"Made in China" Boosts Export
Up to the early 1990s, "Made in China" was still a synonym of "cheap and simple processing" in developed countries in Europe and America, Now, one out of two air-conditioners on the international market is from China, at the same time, TV sets and washing machines made in China account for one/third and one/fourth respectively on the international market, people throughout the world are changing their previous views, in their experience of enjoying high-quality products, they have learned the brand-new implications of the term "Made in China".

At present, the leading manufacturers of computers, electronic products, telecom equipment and petrochemical industries have expanded their production networks into China. The CEO of these enterprises unanimously praise the vigor of China's economy and have declared that the center status of China's manufacturing industry has been formed.

Along with the upgrade of the products and technologies of enterprises set up with the investments of transnational corporations, the rise in the local supporting rate and the enhancement of R&D capability, China's status in the transnational corporations' global production system is being changed from low technological content and low value-added processing and assembling base to completely graded products and technologies and intensive processing and manufacturing base.

Along with the expansion of the investment scale of transnational corporations and the rise of their investment level, China continues to maintain the superiority of its labor-intensive industries, while at the same time, its R& D superiority in high value-added products and technologies has also begun to be formed. Along with the adjustment of this structure, a batch of large corporations and enterprise groups with independent intellectual property rights and strong capability core have rapidly grown up through listing, merging, alliance, reorganization and other forms, "Made in China" is being identified by the world from day to day.

WTO Entry Reveals Its Effect
After traversing an arduous and tortuous course of 15 years, China became a WTO member on December 11, 2001. Joining the WTO is a major strategic decision made by the Party Central Committee in light of the international situation featuring economic globalization and world multi-polarization and proceeding from the needs of further reform, opening up and development.

Accession to the WTO marks a new stage in China's opening to the outside world. China has experienced change from a limited range, domain and regional opening to all-directional, multi-level and wide-ranging opening; from policy-related opening of a trial characteristic to institutional opening under a legal framework; from mainly one-sided self-open market to two-way open market between China and WTO members; from passive acceptance of international economic-trade rules to active participation in the formulation of international economic and trade rules; and from coordinating economic-trade relations only by relying on bilateral consultation mechanism to mutual integration and mutual promotion through multilateral and bilateral mechanisms.

These changes, which exert all-round, far-reaching influence on China, will definitely open up new space for China's economic development, provide new opportunities for the country's foreign economic and trade development and open up new channels for participation in economic globalization.

By People's Daily Online


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