China'S Export Slowdown Is A Good Thing.

10 years since China's accession to the WTO, China's

Accession to the WTO is a key step for China's integration into the world economic system, laying the institutional foundation for China's export oriented development strategy.

On the other hand, from the perspective of the real economy, the rapid growth of China's exports over the past 10 years has benefited from two factors, strong overseas demand and China's population advantage.

In terms of overseas demand, the western economy has been expanding in the past 10 years, and the economy of developing countries has also generally improved.

Against this background, the growth of China's exports is all directional.

In terms of population advantage, China's population has undergone dual pformation in total volume and structure in the past 10 years.

From the aggregate perspective, the proportion of the labour force (15-65 years old) in the total population rose from 69% in 2000 to 74% in 2010. From the structural perspective, about 8 million of the new rural labor force moved to the city in the same period.

Such a huge increase in labor force is the fundamental reason why China's exports are concentrated on labor-intensive products.

The dual pformation of population in China is unique in the world.

Since the implementation of the family planning policy in 1979, the birth rate has dropped sharply, and the population dependency ratio (that is, the population below 15 years of age and the population over 65 years old and 15-65 years old) has dropped rapidly.

The corresponding labor population ratio rose to its peak in 2010.

No country in the world has achieved the speed of population pformation in China, nor has a country reached the height of the labor force ratio in China.

Such a rapid demographic pformation is bound to lead to the extraordinary economic growth pattern of our country. The growth of blowout exports in the past 10 years after entering the WTO is the most typical manifestation of this pattern.

But it also hints at the challenges that this model must face in the next 10 years.

The peak of population pformation is 2010, and then the labor force population ratio will decrease. The speed will be comparable to that of the previous 10 years.

According to a study conducted by the China Economic Research Center of Peking University, by 2020, when other factors remain unchanged, the decline in labour force ratio will lead to a 53.8% reduction in China's exports in 2010.

On the other hand, after the financial crisis, the world economic pattern has undergone tremendous changes. The two main imports of Chinese products, Europe and the United States, are experiencing a chronic recession.

At present, the turmoil in Europe is not a short-term phenomenon, but a long and painful adjustment process.

In order to save the euro, many countries in Europe have to cut government welfare spending on a large scale.

The massive government debt in the United States will drag on the long-term growth of the US economy.

The demand of other developing countries for our products is increasing, but it will take some time to replace Europe and America.

In fact, China's unique talent is providing an excuse for protectionism in Europe and the United States.

History shows that when unbalanced growth occurs in the world, it is always accompanied by current account imbalances, that is, some countries have large surpluses, while others are in large deficit.

Before 1970, surplus countries were also strong countries, such as the United Kingdom and the United States. Deficit countries had no ability to challenge the imbalance.

Since 1980, the United States and Britain have become the biggest deficit countries. They rely on their strong position to pressure surplus countries, mainly Germany and Japan, to balance trade.

China is not Germany and Japan, and will not succumb to the pressure of the United States and Britain. This means that the United States and Britain themselves must make adjustments.

But adjustment is always painful, especially when it seeks to reduce the welfare level of the general public.

Under such circumstances, protectionism can easily become a tool for politicians to win votes.

Taking into account the changes in China's demographic pition and the international situation, the growth rate of China's exports will decline to below 20% in the next 10 years, which may become a normal situation. It will not be impossible to grow below 10%.

But even the growth rate of 10% is also higher than the growth rate of 7% of world trade volume. China's share of Global trade will also increase.

10 years later, China will surpass the United States as the world's largest economy, and the next 10 years will be a period of pformation from a follower to a leader.

During this period, China needs to integrate the international factors into the government's economic strategic considerations more comprehensively, and set aside room for growth and adjustment for other countries.

From this perspective, the deceleration of China's export growth is a good thing, making room for our country to play a greater role in the international arena.