MOC Calls for Increasing Exports     

Recently the foreign trade department of the Ministry of Commerce (MOC) released a report claiming for spurring the exports. In the report, consumption, investment and net exports drove China's GDP to increase 4.7%, 4.6% and 2.6% respectively in 2007, and their contributions were 4.2%, 4.0% and 0.8% respectively in 2008. Therefore this department thought the decreased exports was the main reason for the decline of the GDP growth in 2008.
    In 2008 China has totally levied RMB916.1 billion of tariff in the imports and exports, accounting for 15.4% of the country's total tax. Presently the foreign trade creates more than 80 million jobs, of which, over 48 million are shared by immigrant workers. Some businesses have relied highly on the international market. In 2007 the exports value of footwear, travel articles, ceramic products, furniture and toys accounted for 70%, 80%, 80%, 40% and 40% respectively in their total production value.  
   This reports thought the exports decline will bring the negative impact to other economic sectors. The year over year growth of exports was 23.1% in Q3 of 2008, 4.3% in Q4 of 2008 and negative 19.7% in Q1 of 2009. In adverse, the drop of exports will affect the domestic consumption and investment, according to the viewpoint of the foreign trade department who had researched the exports profile in the period of 1978 - 2006.
   This department pointed out the countries globally scrambled to make their tenders depreciate, which indirectly caused the appreciation of RMB, finally, China's exports competitiveness in price was reduced.
   The oversea direct investment (ODI) and economic cooperation department of MOC also released in a report that the Chinese firms completed a total amount of US$12.43 billion in EPC in Q1 of 2009, increasing 32.6% year over year. Of which, US$6.4 billion came from Asian market and US$4.33 billion was gained from Africa. In Q1 Chinese firms acquired US$33.55 billion of oversea engineering contracts, up 57.5%, representing a huge growing potential.    
   In Q1 China set up 445 new firms at abroad, 6.8% over the year-ago period. According to this report, as of the end of 2007, China's ODI shared 5% in the global total. In 2007 the ratio between FDI (foreign direct investment in China) and ODI was 4.42 : 1 in 2007, lifting to 1.77 : 1 in the first half of 2008. China should encourage enterprise to invest more abroad, in order to ease the trade surplus. MOC has loosed its control on ODI since May 1st this year.
   The market operation department of MOC warned that the citizens' consuming confidence went down, although domestic consumption has driven the GDP to grow by 4.3% in Q1. Demand on house, automobile and communication appliances remained softened.
    The FDI managing department of MOC disclosed that FDI in China has suffered year-on-year drop for seven consecutive months since October 2008. The FDI in the first four months was US$27.67 billion, down 21%. The drop may be lower than the global average. In 2008 the foreign funded enterprises in China contributed to 29.7% in the total industrial production value, 55.3% in total exports and 54.7% in total imports, and supplied 45 million jobs.