Xinhua News Agency:
My question is about foreign trade. China's foreign trade registered a brilliant performance in the past year, but some agencies predict that it will be difficult to sustain a high growth this year. How does the Ministry of Commerce view foreign trade this year? What are your specific plans for stabilizing foreign trade? Thank you.
Li Xingqian:
Thank you. This is also a question of wide attention to all sectors of society. In general, on top of the $6.05 trillion volume and 30% growth rate last year, the foreign trade situation is grim this year, with unprecedented difficulties and pressure in maintaining steady growth.
From the perspective of demand, global external demand growth faces two big uncertainties. First, the pandemic has repeatedly delayed the recovery of the global economy. According to a new U.N. report, the global economic recovery is under great strain due to COVID-19, labor shortages, supply chain disruptions, and rising inflation. Global growth is forecast to slow from 5.5% in 2021 to 4% this year. The WTO expects growth in the volume of global trade in goods to slow from 10.8% in 2021 to 4.7%. Second, global systemic risks are rising as a result of an uneven recovery. Affected by the vaccination gap and policy differences, low-income countries and developed economies see a widening gap of recovery in between, accompanied by depreciating currencies and high inflation. The rapid withdrawal of stimulus policies in some countries may lead to shrinking demand and price fluctuations, which in turn will affect China's export in related industries.
From the perspective of supply, the global industrial chain and supply chain face two major destabilizing factors. First, the accelerated restructuring of the global supply chain and the one-sided pursuit of bringing industries back by developed economies are dividing the market and reducing the efficiency of global resource allocation. Second, disruptions and bottlenecks in the global supply chain can hardly be thoroughly alleviated in the short term. Problems such as high raw material prices, structural imbalances in shipping capacity, and shortages of essential components like chips have persisted. The overall costs of our foreign trade companies, especially small, medium, and micro foreign trade companies, have risen markedly, while their operating risks and burdens remain high. Therefore, the companies feel reluctant to accept orders even if they have orders out there, while they see no profit increase despite a rise in income.
We should face straight up these difficulties and strengthen our confidence. China's foreign trade sector boasts a solid foundation, and the fundamentals sustaining its long-term growth remain unchanged. This year, in terms of foreign trade, we will give top priority to stability and pursue progress while ensuring stability. We will pay more attention to better quality than higher quantity. With the joint efforts of various localities, departments, and foreign trade companies, we are confident that the foreign trade will get off to a good start and remain within a reasonable range throughout the year.
Based on the current situation, we have designated 2022 as a year for foreign trade to consolidate and advance, with a focus on increasing the comprehensive competitiveness of China's foreign trade. We will take four specific actions:
First, we will take cross-cyclical measures to stabilize foreign trade. We will make our policies serve intended purposes and make further use of export credit insurance, manage credit supply in the foreign trade sector well, and enhance the ability of companies to cope with exchange rate risks. We will further step up trade facilitation and effectively help companies overcome difficulties.
Second, we will adopt a diversified market approach. We will give fully play to the role of the unimpeded trade working groups, make better use of the negotiated or signed free-trade agreement and organize major expos, such as China Import and Export Fair, the CIIE and the CIFTIS, so as to help enterprises in reinforcing their traditional markets and expand emerging ones.
Third, we will ensure the smooth supply chains for foreign trade. While cultivating various types of platforms and carriers including national industrial parks for processing and trade, demonstration zones for creative promotion of imports and foreign trade transformation and upgrade bases, we will also continue promoting the streamlined flow of goods, materials and settlements.
Fourth, we will encourage high-quality and innovative-based foreign trade. We will harness the leading role of new business forms such as cross-border e-commerce and overseas warehouses, as well as the role of new models to build leading zones for digitalization of global trade and promote the healthy development of green trade. Thank you.
