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Opinion

Full-fledged revival in foreign trade still far off

(China Daily/Xinhua)
Updated: 2009-12-14 07:48
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A full recovery of China's foreign trade would still face a bumpy ride although it reported its first gain in overseas shipments in 13 months, as the sluggish overseas demand would not be remarkably improved in a short term, analysts said.

Imports and exports rose 9.8 percent in November from a year earlier to stand at $208.2 billion, ending 12 consecutive months of contraction, according to the General Administration of Customs.

Li Jian, a researcher with Chinese Academy of International Trade and Economic Cooperation, attributed the positive figures to a lower comparison base from the same period last year, when exports was down 2.2 percent year-on-year in the first monthly decline since June 2001 due to the devastating global credit crunch.

This year, from January to November, the country's imports and exports totaled $1.96 trillion, down 17.5 percent compared with the corresponding period last year.

The EU remained China's biggest trading partner, though bilateral trade declined 17 percent to $326.27 billion in value in the first 11 months; the United States was second with trade at $266.54 billion, down 13.4 percent; Japan followed with trade down 17.4 percent to $203.33 billion.

Li also believed initial economic rebounds in China's major trade partners in the third quarter had helped push up the foreign trade figures.

The European Union (EU) and eurozone economy returned to growth in the third quarter, joining the United States and Japan in bottoming out of recession, said in a report from the EU' s statistics office released in November.

Gross domestic product (GDP) in the euro zone expanded by 0.4 percent while the United State registered a 2.8 percent economic growth in the third quarter.

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Zhang Yansheng, director with Institute of Foreign Trade of the National Development and Reform Commission, agreed with Li while adding that a series of preferential tax policies aimed at boosting the ailing exports since last year have also paid off.

Exports stood at $113.65 billion in November, down 1.2 percent year-on-year, but were up 2.6 percent from October for the fifth consecutive monthly; imports rose 26.7 percent in November to $94.6 billion.

However, analysts were bearish on a full-fledged recovery in China's foreign trade in a short term, as the ailing external demand would continue amid a fragile and unstable expansion of the global economy.

The world's economy needs a longer time of adjustment to rebound to the level before the financial crises broke out. The unemployment is still severe in major economies and the financial institutions' capability to fund the real economy has been diminished, said Li.

Whole year exports would post a 15-to-17 percent year-on-year decline due to a slump in the first three quarters, said Zhang.

Moreover, analysts worried that trade protectionism would hurl China's export into the abyss of slump. China has become the biggest victim of protectionism, said Zhang.

The Central Economic Work Conference that closed on Dec 7 vowed to boost the recovery of exports and speed up changing the development pattern of foreign trade by maintaining the continuity and stability of policies relating to foreign demand.

Li suggested China's exports should shift from reliance on products with low-added value and step up efforts to expand service trade, in a bid to optimize foreign trade structure.

More support should be given to promote innovations in the small and medium sized enterprises dealing with foreign trade, to shore up the upgrading of foreign trade growth mode, said Zhang.??

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