Textile People Are Worried: Is There Any Hope For The Foreign Trade Market In 2021?

Suddenly down, suddenly up, big ups and downs, foreign trade has gone through the unimaginable 2020.

Li Feng, the boss of Zhejiang foreign trade, still remembers that in February 2020, when the epidemic was serious, the proposal of delaying the resumption of work due to the shortage of epidemic prevention materials left him at a loss for the future. Whether to start or not is a question. Partners are also constantly calling to ask if orders can be delivered on time. However, when he smashed money into anti epidemic materials and officially resumed production in late February, the global epidemic spread in March, leading to the cancellation of foreign orders one after another.

As there was no order, a Zhuhai Company announced in April that it would take half a year off and resume work again on October 8. Li Feng, who was forced to start work, was also dead nailed to the verge of bankruptcy without orders.

However, by the middle of the year, imperceptibly, foreign trade orders were gradually warming up. Li Feng, as the representative of foreign trade enterprises, was finally relieved.

However, no one expected that such a recovery will continue to accelerate in the second half of the year. By the end of the year, orders are even too many to receive. Major foreign trade enterprises are recruiting temporary workers to complete orders overtime.

From the data, it is not difficult to see that in the first three quarters of 2020, China's import and export data from - 6.5% to - 0.2%, and then to 7.5%, foreign trade out of a bright reversal curve.

According to the calculation of the Ministry of Commerce, the total import and export volume of China's goods trade is expected to reach about 32 trillion yuan in 2020, and the actual use of foreign capital in the whole year will exceed 140 billion US dollars. The total import and export volume, international market share and foreign investment attraction have all reached record highs.

Now, on average, 60 million yuan of goods enter and leave the country every minute. According to the calculation of WTO data, China's international market share will be further increased in 2020, which will exceed the historical highest level of 13.8% in 2015, which will stand out under the double pressure of the global economic recession and the new crown pneumonia epidemic, which may also affect China's foreign trade proportion in the world in the future.

Touch the bottom

"At the beginning of 2020, the epidemic prevention work is under great pressure, and the orders are extremely shrinking. We all feel that we are going to be unable to sustain ourselves and may close down soon." Li Feng was previously in an interview with a reporter from the China times.

From the shutdown of production orders unable to deliver, to the resumption of production after the lack of orders, foreign trade is going to the most difficult time in history. Colleagues keep calling each other, but can only get the same notice: "goods suspension", "order cancellation", "subsequent production suspension".

Although the impact of the epidemic has penetrated all walks of life, it is still rare for foreign trade enterprises to be impacted by the domestic epidemic in February and by the international epidemic in March.

Open the website that foreign trade person gathers, above a howl. Some well-known foreign trade enterprises collapsed, while others tried hard to transform. However, no matter which road they choose, in the first half of 2020, China's foreign trade enterprises are suffering. The spreading epidemic situation makes foreign trade enterprises lose sight of the future.

Under heavy pressure, in April, Zhuhai Jinghao Electronic Technology Co., Ltd. and Shenzhen Huaxin Microelectronics Co., Ltd. successively announced "long holidays", in order to reduce consumption and "extend life" for enterprises without orders.

But Li Feng chose to continue to produce products that could not be sold. "The factory can still persist for a period of time and pay workers a little wage.".

On June 9, Premier Li Keqiang of the State Council presided over the executive meeting of the State Council to help foreign trade enterprises to relieve their financial difficulties. While encouraging enterprises to expand the international market, they also supported marketable export products to explore the domestic market.

However, Gao Feng, a spokesman for the Ministry of Commerce, also said frankly that due to the different domestic and foreign trade market environment, foreign trade enterprises are facing some specific difficulties in expanding the domestic market, such as difficulty in expanding sales channels, turning production lines, and building brands.

"Many domestic foreign trade enterprises are mainly engaged in OEM, that is, receiving orders and then producing according to orders. They have neither their own R & D team nor special sales team. They are not familiar with the rules of market access, sales and settlement, so it is difficult to win domestic orders and do domestic trade." Li Feng said.

However, in order to survive, we have to do it no matter how hard it is. Domestic OEM factories of famous foreign brands have begun to switch to domestic trade. Transformation has become a key word for foreign trade enterprises in the first half of the year.

Warming up

However, no one expected that after experiencing the dark moment of "order shortage" in April and may, Chinese foreign trade enterprises suddenly felt warm in the traditional off-season of foreign trade in June and July.

According to the import and export data released by the General Administration of customs, in June, imports and exports increased by 5.1% year-on-year, including export growth of 4.3% and import growth of 6.2%.

The dominoes in the foreign trade chain affect the fate of many enterprises. According to Zhang Jianping, deputy director of the academic committee of the Academy of Commerce of the Ministry of Commerce, in 2020, China will effectively help China's foreign trade enterprises tide over the difficulties through a series of policies, such as stabilizing foreign trade, stabilizing foreign investment, and protecting market entities.

Shao Yu, chief economist of Orient Securities, commented: "China's overall foreign trade performance is far beyond market expectations." Before that, the WTO predicted that trade volume would drop by 30% - 40% in 2020. But China has been growing against the trend.

Li Feng's factory also ushered in the constant inquiry of customers. "More and more people have inquired and orders have increased. In July, we have a total of five cabinets to be delivered. Compared with the traditional off-season of foreign trade in previous years, the foreign trade situation in 2020 has begun to improve." Li Feng said.

According to the data of the State Administration of foreign exchange, in July, China's income from international trade in goods and services was 1757.4 billion yuan and the expenditure was 1381.8 billion yuan. Among them, the goods trade surplus was 451 billion yuan, and the service trade deficit was 75.4 billion yuan.

At this time, in order to further stabilize foreign trade, high-level meetings were held for two consecutive days. On July 29, Premier Li Keqiang of the State Council presided over the executive meeting of the State Council to further expand the opening up, stabilize foreign trade and stabilize foreign investment, and decided to deepen the pilot project of innovative development of service trade; on July 30, the Ministry of Commerce held a regular press conference, the summit expressed its position, and next, it will introduce new policies and measures in time to do a good job in stabilizing foreign trade.

"In the second half of the year, the situation is more complicated and severe. The Ministry of Commerce will step up efforts to implement various supporting measures, study and issue more new policies and measures, effectively enhance the sense of gain of foreign trade and foreign investment enterprises, and firmly stabilize the basic foreign trade and foreign investment market." Ren Hongbin, Assistant Minister of Commerce, said in the outlook.

Surge

In August, September and October, China's foreign trade enterprises suddenly ushered in a few years of good days.

Due to the impact of the epidemic, overseas production is facing stagnation. China has assumed the heavy responsibility of producing orders for the whole world. Many textile foreign trade factories have burst orders, and even some factory orders have been arranged until May 2021.

"Orders began to come back, and the turnover for two consecutive months was twice that of the same period in 2019. The production capacity in August was close to 300000 units, reaching 15% of the annual production capacity in 2019." Panyu a foreign trade clothing factory in charge said.

With the sudden outbreak of the textile market, the entire foreign trade industry has been "ignited", digital electronic products, leather shoes, large machinery and other orders are also rising. Especially in the traditional peak season of European and American markets in September, the purchase of Thanksgiving and Christmas supplies brought a large number of orders, and online demand also increased.

"In recent months, orders have skyrocketed. We even need a lot of workers to work overtime to complete orders." Li Feng said.

If there is an order, there will be production, and if there is a production enterprise, it will be revitalized.

In Zhang Jianping's opinion, at present, China's exports to other countries have formed a substitution effect, so the export has increased sharply. Before the global epidemic situation is under control, this substitution effect will continue for a period of time. Therefore, China's foreign trade is expected to maintain a certain speed in 2021!