Export reform

Updated: 2014-01-10 15:18

By Xin Zhiming (chinadaily.com.cn)

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Grabbing market attention on Friday is no doubt the trade figures, which indicated weaker-than-expected export growth and surplus for December.

While exports for the month rose by 4.3 percent year-on-year, down from 12.7 percent in November, trade surplus was $25.6 billion in November, compared with $33.1 billion in November.

The dismal figures have thrown cold water on those who were cheered up by the exceptional export performance in November. They also serve as an alarm indicating it's too early to expect an imminent and solid export recovery despite the gradual improvement in the fundamentals of some leading developed economies.

Yet from the perspective of a whole-year scenario, things are not that bad.

China's trade surplus remains high at about $260 billion in 2013, a year-on-year 12.8 percent jump. Meanwhile, given the already released trade figures of China and the US in the first ten months, China is set to have replaced the US to become the world's top trader of goods by the end of 2013.

The brilliant performance offers a much-needed assurance for the world's second-largest economy, which is suffering from slow growth as it move along the bumpy road of economic restructuring.

The restructuring move aims to make China's economic growth more reliant on domestic demand and consumption, or more quality-oriented, instead of being driven by heavy investment and galloping exports.

The still large trade surplus and its elevated status in global trade show that the restructuring will be a fairly long process that will not be completed overnight. Policymakers cannot but help take a gradualist approach because of the potential impact of job market restructuring or overall economic soundness.

There are few signs the world economy will pull itself out of the doldrums this year, which eliminates the possibility of export booms by the world's newly-crowned top exporter.

China needs to take the opportunity to mend its pace on economic restructuring, making its export sector more competitive through encouraging technological, managerial and branding-oriented upgrading to shake off the low price-based growth model.

Some domestic export enterprises have taken the lead to reform their growth mode. Policymakers need to provide more favorable fiscal and taxation support to engage with more firms to move in such a direction.