The country's foreign trade industry, which used to be monopolized
by the state, may be opening up further to the non-state sector,
but trade experts warn that domestic private businesses have yet to
learn how to export.
Since China started to relax controls on domestic private
businesses' entrance to the foreign trade sector in 1999, about
20,000 enterprises have gained trading rights, according to
official statistics.
Private companies have become an important force in foreign trade,
notching up high annual growth rates.
The trade volume of private companies increased by 57 percent
year-on-year last year to US$53.2 billion, accounting for 8.6
percent of China's total trade, according to customs
statistics.
Exports rose 66.5 percent to US$32.77 billion and imports climbed
44 percent to US$20.44 billion.
Private companies' exports accounted for 30 percent of the total
exports of east China's Zhejiang
Province and increased six-fold in Shanghai.
The majority of these companies are in the textile, food, light
industry, chemicals, construction materials, machinery,
electronics, metals, computers, software and high-tech sectors.
These newly granted rights have increased private companies'
exports, but trade experts said the majority of private businesses
are slow to start trading and their share of China's total exports
remains small.
By
the end of last year, 1,980 private firms in Shanghai had gained
trading rights, but only 578 of them have sold to other countries,
making up a mere 1.02 percent of the city's total exports,
according to official statistics.
A
questionnaire issued by the Shanghai Association of Foreign Trade
and Economic Cooperation Firms, which was responded to by 195
private firms, revealed that many complain of delays in tax rebates
for exports, difficulties in raising funds, lack of market
information and unfamiliarity with trading practices as major
obstacles.
A
recently issued regulation from the Ministry of Foreign Trade and
Economic Cooperation said China will start to examine and
approve Sino-foreign joint venture trading firms starting from
March 2, 2003.
Trade experts doubt that foreign trading firms will wait until they
are allowed majority shareholding rights or granted full trading
rights.
On
its accession to the World Trade Organization, China promised to
grant full trading rights to all companies within three years.
Foreign companies can hold between 25 percent and 49 percent shares
of joint venture trading firms, according to the new
regulation.
(China Daily February 25, 2003)