The achievement of a total import-export volume exceeding US$1 trillion marks a new course on to which China's foreign trade has entered, China is hopefully to become the world's third largest trading country just behind the United States and Germany.

In 2001, China's gross import and export volume was only US$509.77 billion, the figure doubled in a short space of merely three years, topping US$1 trillion. This was first attributed to the maintenance of rapid, sound and coordinated development of China's economy in recent years, the continued improvement in the benefits of domestic enterprises and the steady enhancement of China's export competitiveness. Secondly, China's accession to the World Trade Organization (WTO) has not only created a favorable external environment for the development of enterprises, but has made China a most favored investment destination for the transfer of global industries. In the past two years, China's actual annual absorption of foreign capital has exceeded a um of US$50 billion, the figure is expected to top US$60 billion this year. Foreign-funded enterprises are found in manufacturing industry, service trade, agriculture, infrastructure and many other fields, of the world's top 500 transnational corporations, over 400 have invested in China.

Thirdly, collective and privately owned businesses have become a new force in import and export trade. The proportion of civilian-run enterprises' export trade to China's total increased from 7 percent in 2001 to 13.7 percent in 2003. At preset, China's economy continues to turn for the better, on which overseas demands are strong, thus making it an indispensable, important component part of the world economy.

Of course, we should take note of the fact that China's status as a big trading country has been established due to its rapid growth of foreign trade, but the current international environment is volatile, some deep-rooted problems in the development of China's foreign trade have not been fundamentally solved, and there is still a big gap between China and trading powers.

Firstly, the total values of China's imports and exports this year have both exceeded US$500 billion, and its dependence on foreign trade surpasses 60 percent, this on one hand indicates the increasing opening of China's economy and its increasing merger into the world economy, foreign trade plays an important role in propelling domestic economic development and exerts ever-larger influence on world economic growth; on the other hand, it also reflects the Chinese economy's high dependence on international markets, and the risk it sustains of being affected by the world economy is enlarging. If there is change in the price of imported raw and semi-processed materials, or if export commodities are subject to anti-dumping abroad, that would possibly produce negative effect on China's economic growth and labor employment.

Secondly, viewed from China's present foreign trade, particularly its export products, the content of technology and the added value of products are generally not high, there are only few products with core technologies and independent intellectual property rights, and there are not many world-famous brands, China still cannot hold a leading position in its foreign trade activities and in the formulation of multilateral trading rules.

Thirdly, after its entry into the WTO, China has suffered abroad increasing numbers of cases of anti-dumping, anti-subsidy and safeguard measures and other trade relief means as well as cases placed on file for investigation. In the future, various kinds of trade conflicts directed against Chinese products will continue to appear. We should pay adequate attention to this.

Next year, China will face many new situations in its opening to the outside world, international trade and investment competition will become fiercer, it can be said that there exist both opportunities and challenges. We should have firmer confidence and stronger courage and exert greater efforts to march toward a trade power by taking the entry of foreign trade on to a new course as the opportunity. We should speed up the change of foreign trade growth method, continue to push for rejuvenation of foreign trade through science and technology and implement the strategy of market diversification, and vigorously promote the optimization of the structure of import and export commodities and the restructuring and upgrading of processing trade. At the same time, we should actively use WTO rules to enhance our capability to cope with international trade conflicts. We should make special efforts to improve the quality of utilization of foreign capital, give full play to China's comparative advantages, accelerate implementation of the ��going global�� strategy and continuously enhance the international competitiveness and world influence of Chinese enterprises and products.

By People's Daily Online