How can the resilience of foreign trade development be sustained?

Securities Times Reporter Qin Yanling

6.2%. This is the year-to-date year-on-year growth rate of China’s merchandise exports (measured in RMB) for the first 11 months of this year. Amid the impact of unilateral high tariffs imposed by some countries, this figure has far exceeded early-year expectations. Beyond expectations, it reflects the resilience of exports driven by China’s long-term efforts to upgrade its manufacturing sector and diversify its trade partners.

Generally speaking, a higher proportion of intermediate goods—including components, raw materials, and semi-finished products—and industrial equipment used for expanded reproduction (often considered “capital goods”) in export commodities indicates a more optimized export structure. The reason is that, compared to final consumer goods aimed directly at end markets, these two categories often demonstrate a country’s position in the mid-to-upstream segments of the global industrial and value chains.

This year, the trend of upgrading China’s export product structure has become even more prominent, with “Made in China” increasingly becoming the common choice for more trading partners. Market institutions, based on data from the General Administration of Customs, estimate that in the first ten months of this year, the export growth rates of intermediate and capital goods were 9.7% and 6%, respectively, collectively contributing 5.6 percentage points to overall export growth. In terms of share, the proportion of intermediate goods in total exports rose to 47.4% in the third quarter, up 2 percentage points from the end of last year.

The manufacturing sector’s solid strength is a key support for maintaining export growth. Meanwhile, diversification of trade partners provides greater flexibility to respond to external shocks. Data from the General Administration of Customs show that, measured in RMB, China’s exports to the U.S. declined by 18.3% in the first 11 months; however, exports to markets such as Africa, ASEAN, India, the EU, the UK, Latin America, and Australia generally maintained high growth, effectively offsetting the impact of declining exports to the U.S.

Whether it is the transformation and upgrading of manufacturing or the diversification of export markets, these are advantages accumulated over the long term and are expected to continue. At the same time, positive results from the China-U.S. leaders’ meeting in Busan, along with easing China-U.S. trade tensions, have kept the market relatively optimistic about next year’s foreign trade outlook. However, trade protectionism and unilateralism remain the Damocles sword hanging over global free trade and economic development. Therefore, both internal and external efforts are needed to sustain the resilience of foreign trade development.

On one hand, efforts should continue to promote manufacturing transformation and upgrading, strengthening internal capabilities to respond to external uncertainties with greater certainty of development.

In next year’s economic work, deep integration of technological and industrial innovation remains a key task. The Ministry of Industry and Information Technology recently emphasized the need to enhance the independence and controllability of the industrial chain, implement a new round of high-quality development initiatives for key industrial chains, and deepen efforts to rebuild industrial foundations and tackle major technological equipment challenges. These measures will help create new advantages for export products. The growth potential of the service sector’s exports should not be overlooked either. Data from the Ministry of Commerce show that in the first ten months of this year, China’s service trade exports grew by 14.3%, with knowledge-intensive service exports increasing by 9.5%, and travel services exports surging by 52.5%.

Building a strong domestic demand market is also a crucial strategy for responding to external shocks and fostering a balanced import-export pattern. Improving income distribution systems, advancing social security reforms to gradually narrow the gap in funding and benefits between employees and residents, urban and rural areas, and enhancing the “income distribution regulator” function of social security; continuing to introduce more inclusive policies directly benefiting residents; increasing policy tilt toward service industries with stronger employment absorption capacity, removing unnecessary barriers and access restrictions, and expanding employment while improving quality—these measures can fundamentally boost residents’ consumption capacity and willingness, thus cultivating endogenous consumption momentum.

On the other hand, there is a need to more firmly defend the multilateral trading system and promote cooperation and mutual benefits through further opening-up.

In response to trade turbulence, China took the initiative in July at the WTO General Council by setting the agenda and submitting a written proposal titled “Recommendations to Support the Multilateral Trading System under Current Circumstances,” proposing a WTO work approach centered on stability, development, and reform, which resonated widely. Additionally, in September, China announced that it would not seek new special and differential treatment in current and future WTO negotiations, taking substantive actions to safeguard the multilateral trading system and actively implement global development and governance initiatives.

According to the recent Central Economic Work Conference, next year will see steady advancement of institutional opening-up, orderly expansion of autonomous opening in the service sector, optimization of free trade pilot zones, and solid progress in building the Hainan Free Trade Port. Efforts will also be made to promote more regional and bilateral trade and investment agreements. These measures are positive steps under the new circumstances, aimed at further facilitating the free and convenient flow of goods, services, and investments regionally and bilaterally, and strengthening China’s cooperation ties with its trade and investment partners.

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(Editor: Wang Zhiqiang HF013)

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