Import boom set to continue

By Xie Jun Source:Global Times Published: 2018/1/15 22:08:39

Commodities demand, lower tariffs offer boost

Workers handle cargo at the Port of Nantong in East China's Jiangsu Province. Photo: VCG

Chinese importers are optimistic about the prospects for 2018, following the strong growth seen in 2017.

"Our business has grown in 2017, and we expect the growth to become stronger in 2018," Shi Xinyu, general manager of Yiwu Ziguang Trade Co in Yiwu, East China's Zhejiang Province, told the Global Times on Monday.

Customs data showed on Friday   showed that in 2017, China's imports surged by 15.9 percent year-on-year to $1.84 trillion, a strong recovery after the 5.5 percent declines in 2016.

Exports also saw improved performance, with growth of about 7.9 percent on a yearly basis in 2017.

Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation, said that China's stable economic growth has led to a rise in the number of commercial opportunities offered by Chinese companies to the rest of the world.

Besides, factors like the rising yuan, policy support and development in trade models have also contributed to the rising imports in China, Bai told the Global Times on Monday.

The yuan appreciated by about 6 percent in 2017, according to data from the People's Bank of China, the central bank.

Rising commodity imports

China's surge in imports has been largely driven by the country's increasing demand for commodities from foreign countries and regions. For example, China imported $162 billion worth of crude oil from overseas in 2017, up nearly 40 percent year-on-year.

China's imports of natural gas also surged by 41.2 percent on a yearly basis to $23.28 billion, while imports of iron ore rose by 31.4 percent in terms of value.

An expert with the China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters, who wished to remain anonymous, said that China's demand for minerals has been surging since the end of 2016.

"The rising domestic economy has led to greater demand for minerals, and this demand can't be met just by domestic production, so imports have been rising," he said, adding that China has recently started to import some minerals that it used to export, such as some rare earths.

"China now has a relatively high reliance on overseas mineral imports, especially upstream ore," the expert noted.

Zhang Zhibin, general manager of Shanghai Yonggang Commodities Co, a steel exporter and iron ore importer, told the Global Times on Monday that his company's imports of iron ore were relatively stable in terms of volume in 2017, but the value surged a great deal because of the rise in prices. "We are highly dependent on overseas iron ore, and have to import it regardless of changes in the price," he said.

Consumption goods boom

Apart from commodities, imports of consumption goods have also risen in the past year. For example, imports of fruit surged by 8.8 percent on a yearly basis in 2017, the  customs data  showed.

Shi, the manager in Yiwu, said that the value of his company's imports surged by about 50-60 percent year-on-year in 2017.

"Imports have been rising particularly sharply in the last five years, thanks to China's flourishing consumption," Shi told the Global Times Monday, saying that he anticipated further import growth in 2018.

Shi's company mainly imports jewelry, food and daily necessities from Southeast Asian countries. He noted that he plans to expand his company's business scale in 2018 to take advantage of the situation.

Bai, the research fellow, said that the central government's recent policy to reduce import tariffs on a number of products has also boosted demand for global goods.

Exports less strong

Compared with imports, China's export growth in 2017 was milder. Bai said this was because some of the traditional Chinese advantages, like low labor costs, have been eroded by the rise of competitors like Vietnam.

Zhang also said that his company's exports of steel slumped by 45.44 percent on a yearly basis to 1.4 million tons in 2017, mainly because high steel prices caused overseas buyers to look for alternatives.

He said his company would work toward more balanced trade in 2018 in order to prevent risks from currency fluctuations.

Posted in: ECONOMY

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