09 Years, Foreign Trade Will Face Multiple Pressures.

It is estimated that in 2009, the total volume of China's foreign trade and imports will show a sharp drop in the monthly year-on-year trend over a long period of time. The total import and export volume of the whole year (US dollar valuation) will probably drop by about 20% compared with 2008.

Among them, the total annual import decline may reach about 25%, and the total export volume will probably decrease by about 17% a year.

First, the export volume is likely to show a negative year-on-year growth trend.

Under the combined effect of various unfavorable factors, the shrinking demand for goods from overseas market will not be a short-term phenomenon, and it is likely to continue for a period of time.

First, the economy of the developed countries led by the United States is facing severe challenges, especially the US economy may be in a depressed state for a long time.

Faced with the grim situation, international organizations generally predicted that world economic growth slowed sharply in 2008 and 2009.

According to the prediction of the International Monetary Fund in November 2008, according to the PPP GDP weighted sum, the world economy increased by 3.7% in 2008, down 1.2 percentage points from the previous year; in 2009 it increased by 2.2%, and 1.5 percentage points lower than that in 2008. In 2009, the developed countries will have the first negative growth in the whole body since World War II.

In December 9, 2008, the World Bank released the latest global economic outlook report, which is expected to slow from 2.5% in 2008 to 0.9% in 2008, the smallest increase since the bank recorded the data in 1970.

In 2009, the economy of the high-income economies will drop by 0.1%, and the economic growth of developing countries in 2008 and 2009 will slow down to 6.3% and 4.5% respectively, lower than 7.9% in 2007. The economic slowdown is even more serious than the Asian financial crisis at the end of 1990s and the breakup of the Internet bubble in the early part of this century.

In the major economies, the consumption expenditure level of the United States in 2008 will be greatly reduced.

Economists' survey shows that the largest drop in US consumer spending since 1942 will extend the recession in the United States and bring the unemployment rate to its highest level in 25 years.

According to the weighted data of 51 economists surveyed in from December 4 to 9, 2008, household consumption in the US will decrease by 1% in 2009, the biggest decline since the Pearl Harbor hit. By the middle of 2009, the US economy will suffer the biggest contraction since the four consecutive quarter.

The situation in Europe and Japan is equally severe.

Two, world trade protectionism is likely to rise again.

Since the 2008, global financial market turbulence and economic slowdown have slowed down. Trade protectionism in Europe and the United States has begun to rise. The voices of rich countries in protecting jobs from low cost countries are increasing.

The reduction of international demand and the lack of trade growth will lead to the revival of world trade protectionism.

At present, the trade protectionism of the ruling departments in the United States, the European Union, Japan and other countries tends to increase, and it is clear that strong measures will be taken to maintain the stability of the regional market trade, and the external trade environment China will face will deteriorate in the future.

Three, the substantial appreciation of the RMB effective exchange rate will greatly inhibit the international market's demand for Chinese goods.

Since August 2008, the US dollar has appreciated strongly, and the appreciation rate for currencies such as euro, pound and Australian dollar has reached over 20%. The RMB exchange rate with the US dollar has basically remained stable, which will greatly inhibit the demand of these countries and regions for Chinese goods.

Over the same period, the currencies of Vietnam, India rupee, won and other economies also had a significant depreciation on the US dollar exchange rate. The import demand of Europe and the United States has been pferred to Vietnam and other economies.

After four years of rapid growth, the international market share of many commodities in China has reached the limit. It is difficult to continue to maintain high growth through expanding market share.

However, the market share is limited. Once the cap is reached, it is impossible to increase the market share to increase the export growth rate, but only to keep the growth rate of commodity exports and the growth rate of demand consistent.

Under the combined effect of these unfavorable factors, the growth of China's export volume in 2009 has become inevitable.

We expect that the actual export volume of China will decline in 2009, with a drop of about 5%.

Second, the number of actual imports will drop.

With the continuous slowing down of China's economy and the decline of the actual export volume, the growth of China's actual imports has declined considerably. In November 2008, it was estimated that there was a negative growth of about 5%.

It is estimated that the actual import of China in 2009 is likely to decline further on the basis of 2008 November.

The decline may be around 7%.

Third, the overall price level of exports will decline a certain extent.

In 2009, with the constraints of external demand and China's economy likely to slow down considerably, the unfavorable factors driving the rise of US dollar prices of export commodities in 2008 or August will be greatly changed. This will provide huge space for the decline of China's export commodity prices, and the overall price of our exports will decline.

First, the sharp fall in demand will create enormous pressure on the prices of export commodities.

Since 2008, the sharp decline in the growth of overseas demand has exerted great pressure on the prices of China's export commodities. Most enterprises can only maintain their profit margins, and a considerable number of enterprises have been in trouble.

In 2009, the shrinking trend of overseas demand remains unchanged, which will certainly exert greater pressure on the decline of China's export commodity prices.

Two, a sharp fall in the prices of basic energy and raw materials has provided huge room for the fall in the prices of China's export commodities.

In the first 9 months of 2008, the sharp rise in the prices of basic energy and raw materials was an important factor that led to the decline of commodity prices in China.

In the first 8 months, the price of manufactured goods in China (PPI) continued to rise sharply. Since September, the rapid decline of basic energy and raw material prices and the rapid shrinkage of demand have led to a sharp decline in PPI.

It can be predicted that PPI will continue to decline. In 2009, China's PPI year-on-year growth is very likely to be negative, and the average annual decline is estimated at around 3%.

Three, the export tariffs have been cut down and cancelled, and the export rebate rates have been substantially increased.

Since August 2008, the Chinese government has repeatedly reduced or cancelled the export duties of some export commodities, increased the export tax rebate rate of some commodities and raised the tax rebate rate. It is estimated that the export tax rebate rate in China still has much room for adjustment.

Four, there may be a certain depreciation of the RMB exchange rate against the US dollar, which will provide some room for reducing the price of our export commodities.

In combination with factors such as falling demand, a sharp decline in energy raw material prices, an increase in export tax rebate rate and changes in the RMB exchange rate, we expect that the overall average price of China's exports will probably decrease by about 10% in 2009.

Fourth, the overall price of imports will drop sharply.

In 2009, international commodity prices will continue to operate at a low level.

Due to the sharp shrinkage of demand and the vigorous deleveraging of financial institutions, international commodity prices will continue to oscillate at the current price level, even if they do not continue to decline substantially.

Taking into account that the proportion of primary commodities in China's imports is above 30%, the average price of primary products in 2009 will probably drop by about 40% compared with 2008. Combined with the decline in the prices of other imported commodities, the overall average price of imports will fall by about 17% in 2009.

Fifth, China's monthly import and export volume will continue to grow negatively.

Beginning in November 2008, China's monthly import and export volume continued to grow negatively as the volume and price of imports and exports dropped.

In 1998, due to the lagging impact of the financial crisis in Southeast Asia, China's monthly import and export volume continued to grow for 8 months from July of that year.

From the beginning of November 2008, the further development and spread of the subprime mortgage crisis in the United States may also lead to a negative year-on-year growth in China's total import and export volume.

In the last round (1998), the total volume of China's foreign trade imports and exports continued to suffer negative year-on-year growth. It has a relatively large decrease except for some months. The negative growth rate in the rest months is relatively small, which is within -5%.

However, the sustained negative growth of this round will be significantly different from that of the previous round. The total import and export volume of China's foreign trade is much lower than that of the previous round.

First of all, the last crisis was mainly affected by Southeast Asia, East Asia and other countries and regions. The economies of developed countries in Europe and the United States have not been greatly affected, and external demand has always been there.

However, in the financial and economic crisis, the developed countries in Europe and the United States were the most affected, and developing countries and regions did not survive.

Secondly, during the financial crisis in Southeast Asia, the degree of internationalization of our country was still very low, and the degree of dependence on foreign economy was very small. But at present, the degree of internationalization of our economy has been greatly deepened, and the external dependence of the economy has also been greatly improved.

Taking into account the changes in import and export prices and quantities, it is estimated that in 2009, the total volume of China's foreign trade imports and exports will show a sharp decline in the year-on-year trend over a long period of time. The total import and export volume of the whole year (US dollar valuation) will probably drop by about 20% compared with 2008.

Among them, the total annual import decline may reach about 25%, and the total export volume will probably decrease by about 17% a year.

Sixth, China's terms of trade will be effectively improved.

In 2009, the terms of trade in China will be greatly improved.

Since July 2008, with the sharp fall in international energy raw material prices, China's import prices have begun to fall sharply. The import price index has dropped from 122.70 in August 2008 to 110.80 in October, and may have dropped to 88 in November.

In the same period, although China's export commodity price index is also falling, the fall is far less than the fall in the import price index.

Reflected in terms of trade, it has risen from 89 low in July 2008 to 97.8 in October, and increased to around 110 in November.

This shows that China's terms of trade have begun to improve significantly.

Integrating our analysis of the trend of import and export prices in 2009, China's terms of trade will continue to improve in 2009.

Seventh, the trade surplus will remain at a high level.

In the first three quarters of 2008, despite the rapid growth of China's foreign trade and import and export volume, China's trade surplus continued to be lower than the same period last year due to the deteriorating terms of trade in China.

However, since September 2008, with the continuous improvement of China's terms of trade, China's monthly trade surplus has continued to increase.

From September to November, China's trade surplus in that month rose to a record high of $29 billion 367 million, $35 billion 239 million and $40 billion 90 million respectively.

Among them, the monthly trade surplus in November was a new high of $40 billion, which was achieved on the basis of a decrease of 9% in total foreign trade and import and export volume.

In 2009, due to the continuous improvement of China's terms of trade, although the total volume of China's foreign trade and imports will probably have an unprecedented sharp decline, the scale of China's trade surplus will remain at a high level. The trade surplus of the whole year will probably be as high as 330 billion US dollars, which will be higher than the trade surplus level of around us $300 billion in 2008.

Eighth, the contribution of net exports to economic growth may be negative.

Because of the changes in terms of trade brought about by the relative changes in import and export prices, the level of trade surplus does not reflect the contribution of net exports to economic growth.

In the first three quarters of 2008, China's cumulative trade surplus was US $180 billion 900 million, a decrease of 2.6% from the same period last year and a net decrease of US $4 billion 920 million.

Despite the negative year-on-year growth in the trade surplus, net exports in the first three quarters still have a considerable pulling effect on China's economic growth, pushing the economic growth up to 1.2 percentage points.

In 2009, as China's actual import and export volume will shrink at the same time, the scale of net exports will probably decrease compared with 2008, and the contribution of net exports to economic growth may be negative, which will have a pull down effect on economic growth.

In 2009, China's foreign trade and imports will decline. This is an inevitable phenomenon of Global trade after the years of rapid growth.

In this regard, we must take an objective view of this downward trend.

Under the premise of vigorously expanding domestic demand, we need to vigorously promote the pformation of China's foreign trade and gradually change the state of high dependence on foreign demand.

First, the export tax rebate rate of some products should be appropriately raised.

In August 1st last year, the state departments concerned raised the export tax rebate rate of some textiles and clothing from 11% to 13%. Since November 1st last year, the state departments concerned have again raised the export tax rebate rate of some labor-intensive and high-tech goods with high added value.

In the future, the export tax rebate policy should focus on the electromechanical and high-tech products that are conducive to upgrading the industrial structure.

At the same time, we must have a long-term relationship with the advanced productive forces.