Opinion | Confrontation hurts both China and the US

This year, China’s foreign trade, although confronted with a complex external environment and many uncertainties, has made progress while ensuring stability.

On the one hand, the gross value of Chinese imports and exports has scored steady growth. In the first four months, the total value of imports and exports of China’s foreign trade of goods reached 9.51 trillion yuan, up 4.3% year on year. Among them, exports increased by 5.7% year on year to 5.06 trillion yuan, while imports went up by 2.9% to 4.45 trillion yuan.

On the other hand, high-quality development has made new progress. In the first four months, high-value-added exports have also registered steady growth, with mechanical and electrical exports of 2.97 trillion yuan, up 4.5%, accounting for 58.6% of the total exports. Private enterprises imported and exported 3.9 trillion yuan, up 11% year on year, and accounted for 41% of the total value of foreign trade, up 2.5% year on year.

Although faced with profound and complex changes, there are still many favorable conditions, as China is still in an important and strategic period of development.

First, both the quality and effect of development in China’s foreign trade are increasingly enhanced. Currently, the import and export of China’s foreign trade is more balanced, with more coordinated regional development and optimized product structure. The export of high-value-added mechanical and electrical products and equipment manufacturing products has maintained a good momentum of growth, and has greater competitiveness in the global market. In the first four months, China’s exports of electric appliances and electronic products reached 1.33 trillion yuan, up 4.9% year on year, while the exports of mechanical equipment stood at 8.9 billion yuan, up 3.9% year on year.

Second, China’s business environment is increasingly optimized. China has successively introduced a series of policy measures to reduce taxes and fees and optimize the business environment. According to the World Bank, China moved up 32 places in the ease-of-doing-business ranking in 2018, among which the ranking of cross-border trade jumped from 97 to 65.

Third, China has more diversified trading partners. In the first four months, China’s trade with the EU, ASEAN and Japan has all been increasing. Trade with Belt and Road countries totaled 2.73 trillion yuan, up 9.1% year on year, which was 4.8 percentage points higher than the overall trade growth over the same period, and the trade volume accounted for 28.7% of the country’s total foreign trade, up by 1.3 percentage points year on year.

Since its initiation of Section 301 Investigation into China last year, the U.S. side has been frequently wielding the tariffs baton and continuously escalating trade frictions between the two countries. More recently, in disregard of the hard-won progress made in China-U.S. trade consultations during the past several months, Washington increased additional tariffs on 200 billion U.S. dollars’ worth of Chinese goods, causing serious setbacks in economic and trade relations between the two sides. Nonetheless, the Chinese market remains a hot spot for American companies.

According to the “American Business in China” annual white paper released by the American Chamber of Commerce in China on April 17, 98% of the surveyed American companies said they would continue to expand in the Chinese market and believed that there were important opportunities in the growing Chinese market. Nearly 42% of the surveyed companies ranked China as a top-three investment destination, up 5 percentage points from 2017. Among them, one in five listed China as the most important investment site, and 38% of the surveyed companies said that China’s investment climate was improving. Notably, in technology and R&D-intensive industries, above 63% of the surveyed companies ranked China as a top-three investment destination, while the figure in 2017 was 51%.

Cooperation is in the interests of China and the U.S., while confrontation hurts both. There is no better option than cooperation, and only a win-win approach will lead to a better future. For China, a country which has experienced numerous winds and storms, it is important to maintain strategic determination, strengthen confidence in victory and concentrate efforts on doing its own business, so as to overcome all the difficulties and obstacles lying ahead. Gong Xin

This article was commissioned by the Office of the Commissioner of the Ministry of Foreign Affairs of the PRC in the Macao SAR