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New export champion

(China Daily)
Updated: 2009-08-26 07:41

In retrospect, when the World Trade Organization (WTO) predicted last month that China will soon overtake Germany as the biggest exporter, it was already a reality.

The global trading body recently found that China exported goods worth $521.7 billion in the first six months of this year while Germany's total was $521.6 billion.

Though the difference is too small to say at this stage which country will be the full year export champion, China's rise as the world's largest exporter looks more certain than ever.

Inevitable as it is, however, the rapid ascendance of Chinese exporters demands second thought from policymakers at home and abroad who are trying hard to engineer a balanced and sustainable global recovery.

On the one hand, Chinese policymakers should make more efforts to help the world's third largest economy shift away from its dependence on export for growth.

Plunging overseas orders have pushed policymakers to back-pedal on restricting energy- and resource-intensive exports to cushion Chinese exporters against the worst global recession since the 1930s.

Now, as Chinese exporters manage to maintain or even increase their share in the global market, Chinese policymakers should no longer worry too much about the robustness of the country's export engine. Instead, they should be ready to continue raising energy and environment standards for exports to advance the country's pursuit of sustainable development.

Related readings:  Exports narrowly edge past Germany's for first time  July exports drop nearly 20% y-on-y, dip 5.4% in June  Steep drop in exports shrinks China balance surplus  Domestic boost not enough to spur exports, says Mofcom

On the other hand, foreign policymakers should accept and recognize that China's rise as the export champion is closely related to its comparative advantages.

As the world's most populous country, China's ample supply of a relatively skilled and cheap labor force and increasing productivity will allow this country to sharpen its competitiveness as a global manufacturing power.

Under such circumstances, those developed countries which intend to render themselves into exporters to balance their economies may find it is difficult to compete with Chinese exporters. But that is definitely no excuse to resort to trade protectionism regardless of whether it is in the form of exchange rate or carbon tariff.

The international community does need to address the global imbalance as soon as possible. Only if the rapid rise of China as the world's largest exporter can be properly matched by a similar expansion of the Chinese consumer market, will China and the rest of the world find a solid footing for a lasting recovery.