Chinese policymakers are fully aware of the challenges facing the country’s foreign trade. The State Council’s executive meeting on April 13 decided to more vigorously implement policies such as export tax rebates to promote a steady growth of foreign trade. The May 5 executive meeting decided to stabilize and upgrade foreign trade. On May 9, a national teleconference on boosting foreign trade and investment was held. Finance and taxation, among other departments, have released multiple measures to stabilize foreign trade. These foreign trade measures suggest that China’s economy is jostling with an increasingly complex, harsh and uncertain environment.
China’s exports reported an obvious slowdown in the first quarter of 2022 after seven consecutive quarters of rapid growth. But the latest data is not rosy. In dollar terms, China’s exports grew 3.9% in April from a year earlier, down 10.8 percentage points from March, according to statistics from the General Administration of Customs. This unusual slump weighed on the business community. Soaring export orders in Vietnam and other Southeast Asian countries set off a new round of concerns about industry transfer from China. China should have the foresight to take proactive actions amid the short-term worries over its foreign trade. China’s foreign trade is facing multiple challenges, including declined foreign demand, deteriorated terms of trade, disrupted supply chains during the Covid-19 outbreak and fierce international competition. In the long run, China must deepen its market-oriented reform, push for institutional opening up, optimize the domestic business environment, and create a peaceful and stable international environment to effectively stabilize foreign trade and ensure sustainable economic growth.
