China Economic Review: Withstand "stress test" foreign trade to "promote stability and quality"

The coVID-19 outbreak came as a surprise, and global trade suffered a rare setback. In this special year, China's foreign trade has withstood the "stress test". According to customs statistics, the total value of China's foreign trade in goods reached 14.24 trillion yuan in the first half of this year, down 3.2 percent year on year and 1.7 percentage points less than in the previous five months. In June, both imports and exports achieved positive growth for the first time this year.

"The overall performance of foreign trade in the first half of the year was better than expected," thanks to the timely introduction of a series of policies to stabilize foreign trade. In terms of targeted assistance to enterprises, we will further improve the export tax rebate policy, reduce the burden on enterprises, further expand the coverage of short-term export credit insurance, and promote a reasonable reduction in the premium rate. In fostering new forms and models of trade, 46 comprehensive pilot zones have been set up to take the lead in taxation, regulation and facilitation, so as to give full play to the unique advantages of cross-border e-commerce. To support the development of processing trade, we will suspend the collection of deferred interest on domestic sales of processing trade enterprises and expand the trial of selective taxation on domestic sales.

Reading the "report card" of foreign trade in the first half of this year also proves once again that "China's foreign trade is highly resilient and competitive, especially the innovation consciousness and market development ability of enterprises are very strong". For example, the import and export of private enterprises is growing against the trend. In the first half of the year, the import and export of private enterprises reached 6.42 trillion yuan, up 4.9 percent, accounting for 45.1 percent of China's total foreign trade value and 3.5 percentage points higher than the same period last year. For example, epidemic prevention materials, "home economy" products export growth faster. In the first half of the year, exports of textiles, including face masks, increased by 32.4 percent, exports of medical materials and drugs by 23.6 percent, and exports of medical instruments and devices by 46.4 percent. It can be said that foreign trade enterprises seized the opportunity of taking the lead to resume production in the face of adversity, and met the global demand for products, forming a strong support for exports.

On the micro level, foreign trade enterprises are important subjects of market economy. Macroscopically, foreign trade enterprises maintain the stability of China's and even the global industrial and supply chains. Data show that in the first half of this year, the value of imports and exports between China and ASEAN reached 2.09 trillion yuan, with a year-on-year growth of 5.6%. This is due to the relatively good situation of epidemic prevention and control in the region as a whole, the continuous deepening of economic and trade cooperation with China in recent years, closer integration of industrial chains and steady growth of bilateral trade. Against the backdrop of uncertainties on the road to recovery of the world economy, China, as the largest country in trade in goods and the second largest in terms of inflows of foreign capital, has always anchored the fundamentals of foreign trade and made important contributions to the stability, openness and efficiency of the global industrial and supply chains.

In the second half of the year, the import and export situation is still complex and grim. Some foreign trade enterprises will still face many problems, such as cancellations or delays of orders in hand, difficulties in signing new orders, and logistical difficulties. To this end, we must continue to focus on the requirements of ensuring people's employment, ensuring the basic livelihood of the people, and protecting market entities. We must pay close attention to the implementation of policies that have been issued, introduce relevant policies one after another, and increase support for the protection of small, medium-sized, and labor-intensive foreign trade enterprises. Improve the way of export tax rebates and speed up the progress of tax rebates; We will guide financial institutions to strengthen financing support such as credit, credit guarantee and guarantee.

Efforts in the crisis to develop new opportunities, in the changing situation to open a new game. Looking back to the "first half" of 2020, we can see that the basic disk of foreign trade has foundation, support and effect. China's foreign trade development from small to large, after countless hardships, in the market beat growth. In the future, with the continuous release of the effects of a series of policies and measures to stabilize foreign trade and the concerted efforts of the whole foreign trade industry for development, a broader market space will be opened up and the import and export of "promoting stability and improving quality" will be realized.