China says trade faces ‘extremely serious’ situation, blames geopolitics

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China’s Ministry of Commerce said on Wednesday that non-economic factors were increasing and interfering with trade. Mandarin, via a CNBC translation. The ministry also said its chief had met more than 20 visiting executives from foreign companies this year.

Workers load goods for export onto a crane at a port in Lianyungang, Jiangsu province, China, June 7, 2019.

Reuters

BEIJING’s Ministry of Commerce said on Wednesday non-economic factors were increasing and interfering with the country’s foreign trade, which faced an “extremely serious” situation in the second half of this year.

“The forceful push by some countries for ‘decoupling’, ‘separation [supply] ‘chains’ and so-called ‘risk reduction’ are man-made barriers that block normal trade,” Li Xingqian, head of the ministry’s foreign trade department, said in Mandarin, according to a CNBC translation. He was speaking to reporters at a press conference about the ministry’s work in the first half.

Chinese exports, a major contributor to domestic growth, have plunged in recent months as global growth has slowed.

On Wednesday, Li noted the general slowdown. He also said that since trade had increased in the three years of the Covid-19 pandemic, it had set a high base for this year’s figures.

Li also made direct reference to calls for supply chain diversification.

“Companies say the politicization of trade in some countries has forced orders and production to relocate, harming the economic interests of suppliers and buyers,” he said. He added that the ministry would help companies deal with “unreasonable trade restrictions”.

The ministry said nothing about its own recently announced export controls set to come into effect Aug. 1 on two key metals.

The United States uses its own export controls in an effort to limit China’s development of high-end technology. Trade tensions between the United States and China have escalated in recent years, prompting other countries to act as well.

China, meanwhile, is seeking to retain and attract foreign investment. Apple’s Tim Cook, Tesla’s Elon Musk and many other business leaders have visited China since it eased border restrictions this year.

The Commerce Ministry said on Wednesday that its minister, Wang Wentao, had met with more than 20 foreign business executives visiting this year. The ministry reiterated its efforts to establish regular round tables with foreign companies in China and address operational challenges.

Among other plans, the ministry said it would make changes to allow foreign investors to increase the size of their strategic investments in listed companies.

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