Time to fine-tune strategies, boost imports

In the past, China did implement export-oriented policies. There are four reasons for this. One is to create more foreign exchange; the second is to protect and develop domestic industries that are in their infancy; the third is to increase domestic employment; and the fourth is the concern that over-reliance on foreign supply of goods will affect national economic security.

China has become a big manufacturing country and trading power with a strong competitive advantage in the labor-intensive manufactured industries. Foreign exchange is no longer a scarce resource.

Globalization has increased the degree of interdependence between nations. In order to promote the development of domestic industries and increase employment, the most important principle is to follow the rules of market economy by creating a level playing field.

In recent years, China has maintained a rapid growth of imports. This has shown that China, as a big market with 1.3 billion people, will have a huge demand for imported goods as the economic development has improved living standards of the people.

China has accelerated the country's process of industrialization and urbanization with its fast expansion, especially in heavy industries. This will boost demand for resources, energy and various other raw materials.

According to Customs data, in recent years, there is a growing trade deficit for chemicals products and other related industrial products. China will import more of these products in the near future to correct the imbalance.

China's overall investment environment is improving. Enterprises' demand for foreign advanced technology, equipment and other investment goods is also getting stronger.

With the improved living standards and the enlargement of high-income groups, the domestic high-end consumers will increasingly demand more luxury goods and seek diversity in high-end products. Domestic production can no longer satisfy such needs.

China used to impose higher import taxes to curb the import of such goods in the past. But in the future, these products will have great growth potential.

China is densely populated with limited water resources. There is no advantage for China to develop agricultural sector.

The nation used to emphasize the protection of the interests of farmers, while limiting imports of agriculture products. Now, the more urgent task is to save resources and protect the environment. Economic development is now keeping pace with industrialization and agricultural restructuring is inevitable in the long run.

So there is a big growth potential for China's imports. While many foreign companies are eager to market their goods to China, local companies should actively adjust their business strategy to cope with the new situation.

The author is a researcher with the Chinese Academy of International Trade and Economic Cooperation.