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Foreign Trade
Opening up to the outside world had greatly promoted the development of China’s foreign trade. Over the last two decades, great changes have taken place in China’s import and export trade. The structure of import and export commodities has been constantly improved. The proportion of the export volume of primary products, with food, agricultural and sideline products, and crude oil as the mainstay, has dropped by a large margin. The proportion of industrial products increased. Remarkable progress has been achieved in the export of machinery and electrical equipment.
China has successfully maintained political stability and rapid economic growth. The booming society and market economy base spawned tens of thousands of competitive enterprises, providing strong propulsion for exports. The rise in people’s living standards and purchasing power guaranteed the simultaneous growth in imports.
In 2004, China’s import and export trade volume totaled US$1,154.79 billion, a 35.7% year-on-year increase, and ranking 3rd in world trade. This compares to 27th, 16th, 8th and 4th place in 1978, 1990, 2000 and 2003 respectively. At present, more than 220 countries and regions trade with China. China’s mainland’s ten major trade partners are: the EU, the US, Japan, Hong Kong Special Administrative Region, ASEAN, the Republic of Korea, Taiwan Province, Russia, Australia and Canada.
On July 1, 2004, China began to implement the revised Foreign Trade Law. This law has transformed the 50-year-old examination and approval system of foreign trade into a registration system; it has made clear regulations on the import and export of goods and technology, international trade in services, the order of foreign trade and the protection of intellectual property rights concerned with the order of foreign trade, etc., so as to accelerate its development.
Since joining the WTO, China’s overall level of import customs duties decreased from 15.6% in 2000 to 10.6% in 2004. In 2005 the customs duties further decreased to 10.1%. Average duty on industrial products fell to 9.3%, on agricultural products to 15.6% and on IT products covered under the WTO Information Technology Agreement (ITA) to zero. Joining the WTO has further accelerated China’s opening up to the outside world and promoted the establishment and perfection of the socialist market economy. Joining the WTO has also quickened the industrial restructuring of China and helped improve the quality and raise the level of China’s economic development.
China’s rocketing foreign trade benefited ordinary people. Expanding imports led to price drops and more colorful commodity choices. Many Chinese have fulfilled their “dream of car ownership”. Booming exports provided more job opportunities as well as revenue and foreign currency reserves. Ministry of Foreign Trade and Economic Cooperation (MOFTEC) figures show over 70 million people in China are working in economics and trade with other countries.