CCTV.com - CNTV English - CCTV News

Balancing trade amid grim export prospects

02-10-2012 15:08 BJT

Watch Video

Play Video

One of the big unknowns of 2012 is how the world’s second-largest economy will cope with shrinking trade volumes, sprawling European debt crisis and an appreciating local currency. All these factors have eaten into the profits of China’s once-profitable exporters and manufacturers. Our reporter Yin Hang travelled to eastern China’s Shandong Province, to find out why boosting imports could also be a way out for the economy.

In recent years, tens of thousands of Chinese exporters have been faced with a worsening outlook. Manufacturing and trade in the world’s second-largest economy has been gradually choked off by the sprawling European debt crisis, appreciating Renminbi, trade protectionism tussles. But there’s always a silver lining. Chinese importers are seeing a historical high in profits.

In Dongying, a city 450 kilometers away from the Chinese capital, this privately-owned company stretches out over 4,500 square meters. Inside, the factory is operating so vigorously that it seems like a fire is raging inside its smelters.

As one of the six-largest copper producers in China, Fangyuan Non-ferrous Metals imports all of its raw materials from countries like Australia, Chile and Peru.

It imported 2.5 billion U.S. dollars worth of raw materials last year, while its sales volume was almost triple that amount last year.

Guo Xuemin is the deputy general manager of the Group. Guo said: "Both our import and sales volumes last year reached to historical highs. The supply and sales chain within our company is operating smoothly. We felt almost no impact from China’s economic slowdown and the European debt crisis. But rather, the Chinese government’s encouraging policies when it comes to imports and currency have boosted our sales."

China posted GDP growth of 8.9 percent in the last quarter of 2011 compared with a year earlier. That came in higher than expected but nevertheless showed that the world’s fastest engine of growth is switching down a gear.

But China is predicting sharply slower foreign trade growth of about 10 percent year-on-year in 2012 as officials forecast "grim" export prospects.

Chinese Premier Wen Jiabao said last week that China should maintain “stable” trade policies as the global financial crisis continues to spread.

China’s top economic planner also suggests last month that the country should boost imports. Import growth was 11.8 percent in December, nearly 40 percent slower than a year earlier. The National Development and Reform Commission suggested this could be done by reducing tariffs on some energy products, raw materials, advanced technology and key components.

But Guo says, for import-reliant companies such as Fangyuan, there are three factors to consider.

Guo said: "First, the company will have to bear the risks of international price fluctuations, because the right of pricing is not in our hands. Secondly, we have to maintain a smooth sales channel. And that is based on the third condition that our products are competitive, our production methods are advanced, and our costs are lower than others."

China’s central government has ratcheted up its supporting policies in recent years to boost imports as the country’s export growth slows, and calls for a more balanced trade structure to gain momentum.

 

Editor:Zhang Rui |Source: CNTV.CN

Hot Videos view more

The celebrations are still continuing as the victorious coach, Joachim Loew, has been honored for his achievement in his hometown of Freiburg.
Germany coach Loew honored in hometown of Freiburg

Chinese men´s national team continued its preparations for next year´s Asian Cup, as they managed a one-all draw against visitors Jordan during a football friendly in Harbin, the capital city of Northeast China´s Heilongjiang Province.
China held to 1-1 draw by Jordan

The defending world champs came into the contest with a perfect 6-and-oh record, but they would be in for a tough first half before opening things up in the second.
USA beat Slovenia 119-76 in quarter-finals

Hot Stories more

UK authorities believe killer of James Foley is a British national

Across the UK the hunt is on for James Foley’s killer, who authorities believe is a British national. As Richard Bestic reports from London, Prime Minister David Cameron cut short his summer break to lead his government’s response.

Israeli war jets renews Gaza strike as truce talks stalled

Three Palestinians were killed and 40 others wounded in the intensive Israeli war jets´ airstrikes on the Gaza city on Tuesday night, shortly before an end of a 24-hour ceasefire in the Gaza Strip,

Missouri police arrest dozens after violent night

As the protests in the town of Ferguson, Missouri turned violent with police facing ´heavy gunfire´ from some ´criminal elements´, cops fired tear gas, stun grenades and arrested 31 demonstrators on Monday night.

Picture in news more

More Video News

Choose TV Program