Slow global recovery, weak demand blamed
China's foreign trade is faced with unprecedented difficulties, amid a slow recovery in the global economy and weak domestic and foreign demand, according to a report released Wednesday by information service platform haiguan.info, which is supervised by the China Customs Information Center.
The report forecast that China's trade volume for 2015 will fall 7.2 percent year-on-year to 24.5 trillion yuan ($3.8 trillion), with imports reaching 10.3 trillion yuan, down 14.4 percent year-on-year, and exports falling 1.1 percent to 14.2 trillion yuan.
The prediction is based partly on the sharp drop in China's trade volume in the first 10 months.
Exports fell 2.0 percent year-on-year to 11.5 trillion yuan during this period, and imports declined by 15.2 percent to 8.5 trillion yuan, data from the General Administration of Customs showed on November 8.
China's foreign trade is going through the hardest period since 2009 when imports and exports suffered a sharp drop in the wake of the global financial crisis, Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times Wednesday.
"It was the sluggish global economic climate in 2009 that put China's exports under pressure, and this year it seems that China's exports have again been affected by weakened demand in foreign markets," Bai said.
Products made in countries like Cambodia and Vietnam have seen increasing popularity in recent years because China has been losing its traditional competitive edge in producing cheap products amid a rise in domestic labor costs, Bai noted.
He Weiwen, an executive council member at the China Society for WTO Studies, said that imports of energy in the first 10 months fell 53 percent, which has significantly affected the data for China's total imports.
The drop in exports is also due to trade protectionism policies imposed by some foreign countries, which China should stand firm against, He told the Global Times on Wednesday.
In terms of the global economy in the first three quarters, China has maintained economic growth amid constant adjustments this year, while developed economies have found it hard to recover and some emerging market economies have suffered deeply, the haiguan.info report said.
Bai noted that the situation in developed economies is still better than that in emerging economies.
The unemployment rate in the US is relatively low at 5.1 percent, and the eurozone has seen an increase in economic development and manufacturing.
However, currency devaluations and stock market turbulence have posed severe challenges in countries such as Brazil and South Africa, according to the report.
In the current context of a faltering global recovery and rising trade protectionism in many countries, global trade is now going through a period of adjustment, Bai said, adding that China's trade may not see such fast growth as before.
But He noted that China could still see an improvement in foreign trade in the future as the country changes its economic growth model and focuses on raising core competitiveness by developing high-tech sectors.
The report said that the central government has rolled out many policies to help Chinese firms go global in a bid to stabilize the economy and deepen international economic and trade cooperation.
For example, China and the UK inked a series of key agreements when President Xi Jinping made his State visit to the UK in November, including cooperation on nuclear power projects, showing the progress of advanced domestic industry in expanding overseas.
"This could be a new way to drive China's trade via foreign investment, but what matters more is development of the technology, which can really help the country become competitive in the global market," He said.
