China hails ‘miracle’ achievement in trade

By Wang Cong Source:Global Times Published: 2019/9/29 21:53:40

Nation now a leader in commerce, but challenges are abundant: experts

Customers shop at an imported goods fair in Hangzhou, East China's Zhejiang Province, in September. Photo: VCG

Just as China's economic growth over the past seven decades has been described as a miracle, the explosive rise of the country's trade is also nothing less than a miracle. Starting from almost nothing, China has become the world's largest trading nation in just 70 years.

However, as the country celebrates the 70th anniversary of the founding of the People's Republic of China, it also faces an array of challenges for its trade, from a transformation process at home to rising trade protectionism and tensions abroad, officials and analysts noted on Sunday.

'Miracle' growth  

"Over the past 70 years, our country has seen earth-shaking changes, and trade has also made brilliant achievements," Minister of Commerce Zhong Shan told a press briefing on Sunday in Beijing. He noted that China's trade began in great hardship amid foreign blockades, but that China has now become the world's largest trading nation.

In 1950 - a year after the People's Republic of China was founded - China's total trade volume was a mere $1.13 billion, but in 2018, that number rose to a stunning $4.6 trillion, according to Zhong. China now imports $2 trillion worth of goods each year.

China has also become a main player and contributor to the global trade governance, and has been supporting the multilateral trade system and pushing for WTO reforms, Zhong said. "China is getting closer to the center of the global stage."

"When you look at the miracle of China's economic development, trade plays a vital role. And the development foreign trade in itself is truly a miracle," Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times on Sunday.

Trade has been the largest driving force for China's economic growth for decades, though its contribution to GDP growth is declining as the country moves toward high-quality growth with a special focus on services and domestic consumption. In 2018, trade accounted for 38.2 percent of China's total GDP, significantly lower than its record high of 64.5 percent in 2006, according to data from the World Bank.

Apart from China's own advantages, including a massive labor force and vast resources, officials and analysts attribute the rapid rise of China's trade to both the market reform and opening-up policies that began in the 1970s, and the country's accession to the WTO in 2001.

"Reform and opening-up led to the huge success of China's foreign trade," He Weiwen, a former Chinese trade official and an executive council member of the China Society for World Trade Organization Studies, told the Global Times on Sunday. 

But he argued that, though the WTO played a major role in boosting China's trade, the most important driving forces were the reform and opening-up policies. "In fact, the fastest growth of China's foreign trade was in the 1990s, before it joined the WTO," He said.

Rising challenges

Even as China continues to maintain fast growth in trade and remains a dominant player in global trade, there are many challenges it faces, officials and analysts pointed out.

"Foreign trade is facing unprecedented challenges both externally and internally," Zhong said, adding that Chinese companies are under a lot of pressure, "especially from the impact of trade tensions."

For over a year, China has been deadlocked in a trade war with the US which has placed considerable pressure on already-slowing trade and economic growth. Though officials are continuing negotiations, there seems no clear end in sight. Internally, an industrial upgrade process has also weighed on growth.

"There is no doubt that China will face a lot of challenges and tensions in trade," He said, noting that as China continues to lead in global trade, others' "share of the cake" might shrink, leading to resistance. "We shouldn't avoid these problems…Instead we should be proactive and try to build a bigger cake for all."

In dealing with these challenges, China will continue to carry out market reforms and further open up its market to ensure stable growth in trade, while expanding its market in countries along the Belt and Road Initiative and in other emerging markets, Zhong said.

Posted in: ECONOMY,FOCUS 70

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