Sino-Japan Trade Outlook UnclearChinese experts are divided over the prospects for bilateral trade and economic co-operation between China and Japan this year.A newspaper reported that JETRO, a Japanese trade-promotion organization, predicted that Sino-Japan trade is likely to reach US$100 billion this year. And Zhang Jifeng, an economist with the Institute of Japanese Studies under the Chinese Academy of Social Sciences, said he was optimistic about the Japanese economy. He said prospects for trade and economic co-operation between China and Japan, despite sharp slides on the Japanese stock market last week, looked good. "China's exports to Japan are mainly lowly priced and labour-intensive products such as garments and food. Japan's demand for these daily necessities are unlikely to fluctuate," he said. "Even if Japan depreciates its currency, the amount of China's exports to Japan are unlikely to change much, although their value will be affected," he added. But, optimistic as he is, Zhang does not expect bilateral trade between China and Japan to increase by 20 per cent to US$100 billion this year. A 10 per cent increase is a more reasonable prediction, he said. However, Chen Jian, an economics professor at the Renmin University of China, said stalling Japanese economic recovery would give China a hard time this year. He expects the Japanese economic slowdown to cut Japan's investment in China and reduce bilateral trade. Japan is China's largest trade partner and second largest foreign investor after the United States. But Zhang firmly believes that a well-functioning interactive mechanism exists between China and Japan which will boost bilateral trade and economic co-operation. China's rapid economic development and large potential market are a major attraction to Japanese investors, he said. Japan's investment in China promotes imports and exports between the countries, said Zhang. Although China's trade surplus with Japan is increasing, it is still at an acceptable level for Japan, which has an even larger trade surplus with the US, he added. Trade between China and Japan stood at around US$60 billion between 1996-99 because of negative influences from the 1997 Southeast Asian financial crisis. But it soon picked up steam as the two countries recovered. Sino-Japan trade increased by 25.7 per cent year-on-year to US$83.2 billion last year, according to statistics from the General Administration of Customs. Source: China Daily |
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