Opening Case

As an important constituent of China’s open economic system, foreign trade

plays an irreplaceable role in the process of reform and opening up, as well as in the
development of the economy and society. Over the past 30 years, since the reform and
opening-up, the development of foreign trade has made a great contribution driving
the national economic development of China and strengthening the integration with
the world economy. Firstly, it has promoted the economic growth which can be visible
based on the fact that the yearly average contribution rate of foreign trade to the
economic growth reaches up to around 18%. This has vigorously promoted the
coordinated development of China’s open-economy and national economy, that drives
the growth of the national economy. Secondly, it has expanded the employment, as
foreign trade has directly and indirectly driven the employment of about 180 million
people. The result is that the surplus of labor is converted into demographic dividend,
creates national welfare, and vigorously promotes the social stability and balanced
development of urban and rural areas. Thirdly, it has alleviated the resource restriction,
meaning that not only has import guaranteed the domestic market supply, but also it
eased the resource bottleneck of national economic development. It is estimated that
the imported agricultural products allowed China to save one billion mu of cultivated
land. Moreover, it has enriched the fiscal revenue, as the tariff and value-added tax
collected by Customs on behalf of the tax authorities are directly correlated with
foreign trade, which has created about 18% of national revenue. Additionally, it has
boosted the industrial advancement, through the participation in the international
division of labor, foreign trade takes advantage of domestic and foreign markets and
resources to promote the digestion, assimilation and re-innovation of imported
products, which has facilitated the technical progress and in the turn industrial
development. Consequently, China gradually becomes the largest manufacturer of
industrial products, with the manufacturing and design of some products and fields
advancing to a higher level of quality. In addition, it has accelerated the structural and
institutional innovation upon joining the WTO, China has been carefully fulfilling its
commitments by consistently deepening structural reform of foreign trade, perfecting
the laws and regulations system of foreign trade and rationalizing the relationship
between the government and the market, this has encouraged innovation significantly
and kept the market energized. Finally, it has enhanced the integration with the world
economy as the “ballast” and “propeller” of driving bilateral relationship, foreign
trade has played an important role in developing economic and trade cooperation with
various countries, forming a new pattern in foreign relations, and boosting the status
as a key player internationally.
(Data source: Commerce Department’s understanding of Several Opinions on
Accelerating Cultivating New Advantages in Foreign Trade Competition.
http://www.byboc.gov.cn/Article_Show.asp?ArticleID=1237）