Many people are concerned about the state of the global market and believe that demand is declining sharply. However, this assessment may not necessarily reflect the truth. The reality is that while global market demand growth is slowing, overall demand is not declining sharply.
The World Trade Organization has predicted that global trade in goods will grow by just 1 percent from the previous year in 2023. However, if we consider price factors, it is possible for global trade to achieve an annual growth of 7 to 8 percent this year. This is not low compared to recent years, indicating that the market is still showing signs of growth.
Currently, global market demand is slowing down in some sectors, but the growth potential for China’s exports is still significant if we can properly handle the situation. Despite demand for some products from certain countries facing saturation, many Chinese products’ shares in global export markets rose in 2022. This is a positive sign, as major importers worldwide saw their imports grow by double digits.
Although there were price factor influences, there were no signs of a sharp slowdown in demand. There were some monthly or quarterly growth slowdowns last year, but these were due to other factors and did not represent full-year trends.
Based on import data released by 71 countries, China’s share in their import markets in 2022 declined slightly by 0.6 percentage point. However, if we exclude data from oil and natural gas trading, China’s share in their import markets actually rose. Their reliance on Chinese products, particularly mechanical and electrical products, increased.
Despite demand growth for China’s products slowing, overall demand is still expanding. Based on the experience of studying foreign trade for many years, we think that as long as demand in the international markets is on the rise, China’s foreign trade will continue to grow.
The negative impact of US decoupling efforts created an unfriendly environment for China’s foreign trade last year. However, China’s foreign trade still stood at more than 40 trillion yuan ($5.8 trillion), showing strong resilience.
We are studying ways to prepare some new foreign trade policies, and some experts suggest that China seizes growing opportunities arising from emerging markets’ import expansion amid their economic recovery. While stabilizing the scale of exports to the US, it is also necessary to actively restore Hong Kong’s role as a “super-connector” to shore up an increase of foreign trade.
Our exports to Europe are expected to further expand, and some RCEP countries and Belt and Road-related economies will account for considerably increasing shares of China’s exports. We are studying relevant strategies to expand exports to these countries and regions in the next step.
This year, we should also intensify efforts to fuel the development of some new trade formats and models to strengthen and cultivate the growth of the global market. Although there are challenges ahead, we remain optimistic that the market will continue to grow and that China’s foreign trade will remain robust.