A senior Ministry of Commerce (MOFCOM) official said in
Guangzhou on Thursday that China will face tougher challenges in
foreign trade in 2005 now that its three-year transitional WTO
membership has expired.
In honoring its WTO commitments, China will further open its
markets this year. In return, Chinese commodities will have wider
overseas market access, creating favorable conditions for steady
growth in imports and exports, said Liu Haiquan, deputy head of the
ministry's Planning and Financial Affairs Division.
Liu made the remarks during a special news conference during the
ongoing 97th session of the Chinese Export Commodities Fair in the
capital of south China's Guangdong
Province, held on the release of a foreign trade
report.?
China completed all procedures and signed an agreement for
joining the WTO on November 10, 2001, and all the documents took
effect a month later. The country was given a grace period of three
years before fully opening up its prime industries.
According to its WTO commitments, by late this year China will
further slash its tariff level from last year's 10.4 percent to 9.9
percent. All non-tariff measures will be phased out, including
import quotas, import permits and soliciting bids for special
commodities.
For example, tariff quotas for agricultural products will be
abolished, designated dealership for the import of wool will end
this year and vegetable oil quotas will be removed by 2006.
Liu warned that, though foreign trade would grow steadily in the
months to come, benefits gained from many exported commodities
would remain low because of factors such as a lack of core
technologies, branded products and commodities with higher added
value, coupled with possible disruption following liberalization of
export operation rights.
"After the WTO transitional period, the economy is affected more
easily by international market fluctuations because many importers
still lack caliber in negotiating good prices," said Liu.
There is an increased possibility that imported commodities
might produce a negative impact on farmers and some manufacturing
businesses as their competitive power could hardly improve enough
in a short period of time, according to Liu.
Services will develop faster, but competition between Chinese
and overseas-funded businesses will be fiercer, and Liu predicted
that China would retain a larger deficit in the service sector this
year compared to last year.
The official also said work against trade disputes would remain
arduous, as cases of trade protection against Chinese commodities
may increase.
According to the report by the Planning and Financial Affairs
Division and the Institute of International Trade and Economic
Cooperation, foreign trade will grow at a rate of 15 percent this
year to exceed US$1.3 trillion, as against 35.7 percent last
year.
Exports will reach US$682 billion, up 15 percent year-on-year,
and imports US$651 billion, up 16 percent.?
China maintained a favorable trade balance of US$16.6 billion in
the first quarter of 2005, with exports totaling US$155.9 billion
and imports US$139.3 billion.?
"I don't think the big favorable trade balance attained in the
January-March period will last long in the months to come," said
Liu, who held that the country would keep last year's favorable
trade balance record of US$30 billion in 2005.
(Xinhua News Agency April 30, 2005)