China has set a foreign trade growth target of 10 percent from now until 2010, 14 percent lower than the annual average over the last five years.

The Ministry of Commerce said on Wednesday that the downward projection reflects the "substantial change" in China's foreign trade strategy, preferring healthy and more profitable expansion to the enlargement of foreign currency reserves.

Under the plan, China's foreign trade volume will hit US$2.3 trillion by 2010 with its huge trade surplus largely offset by imports.

Sources with the ministry revealed that another factor behind the reduced growth target was concerns that export-oriented manufacturing trade, the engine of China's booming foreign trade, could slow down after a decade of rapid growth.

In order to meet the new target, the ministry has mapped out a number of measures. Export-oriented companies, especially private ones engaged in labor-intensive manufacturing, must move away from low-price competition and try to gain a competitive advantage through technical innovation.

The most important thing is for private firms with proprietary intellectual property rights to be aware of the value of a global distribution network and set about building one, the ministry said.

According to the plan, exports generated by private firms should represent more than 35 percent of the total, up 15 percent from 2005.

China also hopes that more than half of Chinese companies will possess proprietary intellectual property rights by 2010 and that more than 15 percent of export-oriented companies will own trademarks that have been registered abroad.

In order to curb the expansion of industries that consume large amounts of energy, the ministry said China would raise industrial access thresholds and establish compulsory standards to ensure that the pricing of export commodities takes into consideration the costs of environmental protection and labor benefits.

To optimize its foreign trade structure and bolster its service trade sector, which is less than a quarter of that of the US, the ministry aims to facilitate the import and export of services.

It hopes the service trade will maintain an annual average growth of 20 percent and hit US$400 billion by 2010.

Aside from foreign trade, the plan addresses the development of local commerce. The annual average growth for retail sales of consumer goods was projected at more than 11 percent, equal to the actual growth over the last five years.

Sales of production materials were predicted to grow 11 percent annually, about 4.5 percent higher than actual growth in the last five years.

(Xinhua News Agency October 12, 2006)