10% Increase in Labor-Intensive Product Exports, Encouraged by Double-Digit Growth in China Exports and Imports
Optimistic View of 9% GDP Growth Supported by China's Foreign Trade
[Asia Economy Beijing=Special Correspondent Jo Young-shin] There is a forecast that the Chinese economy will grow up to 9% thanks to foreign trade. The Chinese economy has been showing signs of slowdown in the second half of the year due to a decrease in the base effect, the resurgence of the Delta variant of COVID-19, and abnormal operation of import-export logistics systems.
The state-run Global Times, citing data from the General Administration of Customs of China, reported on the 8th that last month, China's export and import values increased by 25.6% and 33.1% respectively compared to the same month last year, indicating that China's foreign trade structure remains robust.
Last month, China's export and import values were $294.32 billion and $235.98 billion respectively, significantly exceeding market expectations. Although major Chinese ports were controlled due to COVID-19, causing disruptions in imports and exports, both exports and imports increased substantially.
Chinese economic experts have expressed optimistic forecasts that China's annual economic growth rate could reach 9% due to the expansion of foreign trade.
In particular, Chinese experts are paying attention to the fact that the share of private enterprises in exports and imports is expanding. As of the end of August, the foreign trade volume of Chinese private enterprises totaled 11.92 trillion yuan, accounting for 48.1% of China's total trade volume. The Global Times emphasized that this is an increase of 2.3 percentage points compared to the same period last year.
Tian Yun, Deputy Director of the Beijing Economic Operation Association, explained, "The increase in the share of private enterprises in exports means that the overall industrial structure is improving, including employment," adding, "Infrastructure investment and the high-tech manufacturing sector will drive the Chinese economy in the third and fourth quarters."
Chinese experts also unanimously point out that the increase in exports of labor-intensive products is noteworthy. As of the end of August, the export value of labor-intensive products was 2.46 trillion yuan, a 10% increase compared to the previous year.
Professor Chao Heping of the Department of Economics at Peking University said, "The increase in exports and imports means that there is no country that can replace China in the global supply market."
The Global Times noted that as the Delta variant virus spread to Southeast Asian countries, China's exports to the ASEAN region increased significantly, implying that ASEAN cannot replace China. The media also added that despite the US-China conflict, trade volume between the two countries increased by 36.6% compared to the previous year.
The Global Times forecasted that China's total foreign trade increased by 25% year-on-year, and China's gross domestic product (GDP) will reach 9% on an annual basis.
However, there are also opinions that for the Chinese economy to grow by 9%, the domestic market must be supported, and for this, government stimulus measures are necessary.
Professor Chao said, "The pandemic continues to hinder consumption recovery," and predicted, "Chinese financial authorities may lower the reserve requirement ratio once or twice more this year to implement financial policies that help the real economy."
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