MOFCOM aims for boost with promo trips

08:51, March 17, 2010      

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This year's first trade and investment promotion group organized by the Ministry of Commerce (MOFCOM) leaves for European countries including Finland and Switzerland today, Yao Jian, spokesman for the MOFCOM, said Tuesday at a press conference.

Another group will visit South America next month. The MOFCOM will cooperate with related industry chambers to continue organizing such groups this year, Yao said.

Over the past year, the MOFCOM has organized 13 trade and investment groups, visiting over 30 countries and regions.

The visits are part of the MOFCOM's efforts to improve the country's trade balance this year. The MOFCOM has pledged to take a series of measures to boost imports, including urging various countries to loosen restrains on high-tech product exports to China.

Premier Wen Jiabao also expressed the government's determination to promote imports in his March government work report at the annual "two sessions."

China's imports have seen strong growth in recent months. Imports rose 55.9 percent from a year earlier to reach $112.29 billion in December, hitting a new monthly high. For the combined January-February period, imports surged 63.6 percent to total $182.32 billion, according to figures released by the General Administration of Customs.

China's trade surplus has also seen a continued decline. Last year the trade surplus fell 34.2 percent to total $196.07 billion. In January and February the country's trade surplus dived 50.4 percent to total $21.76 billion.

"For the year as a whole, we expect the trade surplus to drop modestly from a year ago because of higher growth in average import prices," Wang Tao, head of China Economic Research, said in a research note March 10.

Imports will continue to increase and more balanced trade can be expected this year, Yao also said.
"The government's call for increasing imports is partly for the purpose of allaying pressure for the yuan to appreciate owing to a strong export recovery," Lu Zhengwei, a senior economist at Industrial Bank, told the Global Times.

Rising imports, particularly of advanced technology products, can also help "step up industry structure upgrading," Lu said.

While saying that industries that are heavily reliant on exports such as the traditional manufacturing sector aren't likely to be affected by the government's import-friendly policies in the near future, Lu pointed out that domestic manufacturers may need to be prepared for change in the long term.

Manufacturers located in costal regions can consider transferring production inland to lower costs, or could upgrade their manufacturing technology to raise added value, Lu said.

If the yuan appreciates too fast, transferring plants overseas to countries such as Vietnam may also be an option, he added.

Yao also said trade frictions are likely to rise, so the government will improve the current pre-warning mechanisms by enhancing monitoring of imports and exports with key countries.

Source: Global Times
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