China's Imports and Exports Grow by 5.3% in the First Three Quarters

Customs data released on October 14th showed that in the first three quarters of this year, China's goods trade imports and exports reached 32.33 trillion yuan, a year-on-year increase of 5.3%; of which exports were 18.62 trillion yuan, up by 6.2%; imports were 13.71 trillion yuan, up by 4.1%.

For the first time in history, the total imports and exports in the first three quarters exceeded 32 trillion yuan, with each quarter's imports and exports reaching 10.15 trillion yuan, 11 trillion yuan, and 11.17 trillion yuan respectively, all surpassing 10 trillion yuan for the first time historically.

What are the main factors driving the growth of China's foreign trade data in the first three quarters? What does this reflect about China's foreign trade situation? Let's listen to the analysis from Tu Xinquan, Dean of the China WTO Research Institute at the University of International Business and Economics.

Support for Foreign Trade Growth from Both Supply and Demand Sides

Tu Xinquan: First of all, China's foreign trade data for the first three quarters is quite good, with each quarter exceeding 10 trillion yuan for the first time in history, indicating that the momentum for China's foreign trade growth is very strong. The reasons for the growth of foreign trade are from both the supply and demand sides.

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From the supply side of exports, the competitiveness of the manufacturing industry is continuously improving, and the value is continuously increasing. The content of independent brands and independent technology is continuously increasing, and China's industry is also continuously achieving technological and structural upgrades. Therefore, the unit value of export goods is increasing, which is the most fundamental reason for the continuous increase in export amounts. Overall, China's export competitiveness is continuously improving, stemming from the significant progress made by China's manufacturing industry in recent years. Regardless of technology, brand, the integrity and completeness of the industrial chain, and the supporting capabilities of the supply chain, these factors determine China's strong international competitiveness.

From the demand side of exports, China's main trading partners also basically maintained positive growth in the first three quarters. In terms of growth speed, the markets of developing countries, mainly including countries participating in the "Belt and Road" initiative, RCEP, and ASEAN, have a significantly faster growth rate. Therefore, the increase is mainly contributed by these trading partners.

Imports Have Achieved a Relatively Robust Recovery Trend

Tu Xinquan: From the perspective of imports, the growth trend of imports in the first three quarters of this year is also good, which more reflects the recovery of domestic demand. Especially the recovery of the manufacturing industry and industrial production, the demand for imported raw materials, imported parts, and imported machinery and equipment is maintaining growth. Although China experienced a relatively difficult period last year, this year has achieved a relatively robust recovery trend, so the performance of imports is also good.Achieving trade growth with over 160 countries and regions

Customs statistics show that in the first three quarters of this year, trade with over 160 countries and regions around the world has seen growth. Trade with countries participating in the joint construction of the "Belt and Road" initiative amounted to 15.21 trillion yuan, with a growth of 6.3%, accounting for 47.1% of the total. Trade with ASEAN reached 5.09 trillion yuan, with a growth of 9.4%. During the same period, trade with the EU and the US grew by 0.9% and 4.2%, respectively. Zhou Maohua, a macro researcher in the financial market department of Everbright Bank, shares his insights with us.

Great trade potential with countries participating in the "Belt and Road" initiative

China's imports and exports with ASEAN and countries participating in the joint construction of the "Belt and Road" initiative have seen significant growth. What potential does the future hold?

Zhou Maohua: China has great trade potential, strong complementarity, and a strong desire for cooperation with countries participating in the joint construction of the "Belt and Road" initiative. Data shows that China's trade volume with these countries accounts for nearly half of China's total foreign trade value. At the same time, China's trade with ASEAN continues to grow rapidly, with ASEAN becoming China's largest trading partner for four consecutive years. Countries participating in the "Belt and Road" initiative account for 65% of the global population, indicating a broad market prospect.

In addition, China and the participating countries have strong complementarity in industrial structure and market demand. Strengthening trade and investment exchanges between China, countries participating in the "Belt and Road" initiative, and ASEAN is of strategic significance for meeting market demands, promoting investment and employment, improving infrastructure, enhancing production efficiency, increasing residents' income and social welfare, and strengthening regional economic stability.

Actively integrate into the global industrial chain and supply chain system and market

What are the reasons for China's import and export growth with the EU and the US? How can we further stabilize exports to developed economies?

Zhou Maohua: The growth in China's imports and exports with the EU and the US is mainly due to the resilience of demand in Europe and America, the improvement and efficiency of China's foreign trade exports, and the competitiveness of China's foreign trade exports. At the same time, the base effect of last year was relatively low. The growth in imports is mainly due to China's strong and effective macro policies, and the steady and moderate recovery of domestic demand.

At present, factors such as the rise of global trade protectionism, tariff barriers, and the slowdown in demand from developed countries pose certain uncertainties to China's foreign trade exports. In the future, China needs to strengthen product quality control and promote the continuous improvement of the quality of foreign trade exports. At the same time, increase investment in research and development to enhance the added value of export products. In terms of foreign trade exports, it is also necessary to enhance market sensitivity to the demands of developed countries and actively respond to changes in their demands; continuously improve brand awareness and market share; actively integrate into the global industrial chain and supply chain system and market.Looking at China's Export Trend in the Fourth Quarter

According to the latest forecast by the International Monetary Fund (IMF), the global economic growth this year is 3.2%, lower than last year. Currently, the growth momentum of major economies is weak, and interest rate cuts have been widely implemented recently, with global trade protectionism intensifying.

Will the weakening international market demand affect China's exports? How to predict the export trend in the fourth quarter?

Let's first listen to the response of Lv Dalian, the spokesperson of the General Administration of Customs and the director of the Statistical Analysis Department, to the reporter of the 21st Century Economic Report at the press conference.

China's exports still have strong resilience

Lv Dalian: Looking at the overall situation of the first three quarters, exports have maintained growth for the sixth consecutive month in September. The cumulative export scale in the first three quarters reached 18.62 trillion yuan, setting a historical high for the same period, with a year-on-year increase of 6.2%. This growth rate is 0.5 percentage points higher than the average growth rate for the same period in the past 10 years. According to preliminary calculations based on the latest data released by various economies, China's overall exports account for a stable and rising share of the global market. Among the main export products, from small items such as furniture and home appliances to large items such as ships and containers, the share in the global market has increased to varying degrees. China's exports still have strong resilience.

At present, China is accelerating the construction of a modern industrial system, developing new quality productive forces according to local conditions, and the advantages of a solid manufacturing foundation, a complete range of industries, and a large-scale industrial system are still firmly in place, and its position in the global industrial chain and supply chain pattern continues to be consolidated. Recently, the results of our survey of more than 800 major export enterprises across the country show that 69% of enterprises reported that exports in the fourth quarter were flat or increased. Overall, we are still full of confidence in exports in the fourth quarter.

Let's listen to the views of Peng Bo, a researcher at the Research Institute of International Trade and Economic Cooperation of the Ministry of Commerce, on the interpretation of related issues.

China's exports will continue to maintain strong momentum

Peng Bo: At present, the weakening international market demand has a certain impact on China's exports, but it will not be very significant. The main reasons are as follows: First, China has the advantage of a complete industrial chain; it has strong risk resistance and can relatively fully absorb the pressure brought by various unexpected shocks. Although global demand is weakening, necessary demand cannot be reduced, at least not significantly reduced. China's industry has a significant competitive advantage in meeting various needs.Secondly, China's industry is upgrading rapidly; Chinese products currently have a very obvious competitive advantage in the global mid-to-low-end fields. At the same time, China is also continuously developing in the field of high-end products, with a strong growth momentum, which is conducive to ensuring market stability. Moreover, driven by high-quality development and new quality productive forces, this advantage will further expand.

Thirdly, the encirclement of the United States and the West strengthens China's global layout. The trade barriers imposed by Western countries on China will only change the path of China's exports, not fundamentally change the trend of China's exports. Goods are like water, always flowing in the most favorable direction. Where there is a price difference, goods will flow there. After the outbreak of the trade war, the exports of ASEAN and India to the United States have increased significantly, but during the same period, the growth of imports from China by these countries and regions has been even faster. In fact, after adjusting the export path, China's total export volume has actually expanded.

In summary, although global demand has weakened, China's exports will still maintain strong momentum. It is expected that China's export data in the fourth quarter may decline, but it is still very likely to maintain good growth.