The total import and export volume of private foreign trade enterprises, mainly small, medium and micro enterprises, increased by 26.7 percent last year

Small, medium and micro foreign trade, small ship energy is big

China's foreign trade volume reached a record high of US $6.05 trillion last year. In this bright report card, small, medium and micro foreign trade enterprises contributed a lot. Data show that in 2021, private enterprises, mainly small, medium and micro enterprises, maintained the status of the largest foreign trade business entity in China, with a total import and export volume of 19 trillion yuan, an increase of 26.7%, accounting for 48.6% of China's total foreign trade, and contributing 58.2% to the growth of foreign trade.

In the face of the complex situation at home and abroad, how can small, medium and micro foreign trade enterprises achieve such achievements? How competitive are they? How to maintain the development momentum of Msmes this year?

The level of trust is increasing-- Chinese small, medium and micro foreign trade enterprises are gaining more trust from buyers in the global market, making their products more attractive, and improving their export efficiency

In the past year, China's foreign trade enterprises faced many difficulties.

A medical device export employee in East China introduced that, affected by the epidemic, customer demand in the medical device foreign trade industry in 2021 is on the rise, and his company's orders for epidemic prevention products are increasing. However, higher income does not necessarily increase profits. "The price increase of raw materials in the first half of the year has eased in the second half. In addition, the USD/RMB exchange rate is not ideal, which has reduced our profit margin and forced us to raise the prices of some products, indirectly reducing the willingness of international customers to buy."

According to the 2021 SME Export Trade (B2B) Index Report jointly released by China Council for the Promotion of International Trade and Shanghai Zuochang Network Technology Co., LTD., global raw materials and commodity prices have increased continuously since January last year. In the same period, global shipping prices have soared, the RMB exchange rate has strengthened, and some domestic provinces have restricted electricity supply. All have caused no small impact on foreign trade enterprises. However, in the severe internal and external environment, as the "capillary" of the foreign trade industry, small, medium and micro enterprises overcome difficulties and show strong competitiveness.

In terms of buyers' trust and product attractiveness, the report shows that after the Spring Festival of last year, the order amount and order advance payment ratio of small, medium and micro foreign trade enterprises have been at a high level. Meanwhile, the average collection times of a single order have decreased significantly, which indicates that foreign merchants are willing to provide Chinese small and medium enterprises with a larger amount of orders. Moreover, they are willing to pay a certain percentage of advance payment before Chinese enterprises export, which reflects that foreign merchants have strong confidence in the quality of Chinese smes' products, strong willingness to carry out medium - and long-term cooperation, and increasing trust.

In terms of export operation efficiency, since September last year, the average delivery time of China's small, medium and micro foreign trade enterprises has been shortening, indicating that the impact of international logistics block on China's foreign trade has been weakened. In November, the order amount reached the annual peak, and the average delivery time was 2 days shorter than that in the middle of the year, indicating that the export operation efficiency of small, medium and micro foreign trade enterprises was further improved, and they still showed better response speed even with the increase of the order amount.

"Last year, small, medium and micro foreign trade enterprises, despite the adverse factors such as the spread of the global epidemic, rising commodity prices and high shipping costs, seized the new opportunities of the global economic recovery, gave full play to the advantages of 'small ships are easy to turn around' with the support of the national foreign trade policy, and achieved good development." China Council for the Promotion of International Trade vice President Zhao Ping said.

Flexible and competitive -- Opening up new markets, trying new business forms, and making timely adjustments in response to market changes

Where does the competitiveness of small, medium and micro foreign trade enterprises come from? Experts analysis, small, medium and micro enterprises flexible, can adapt to the market demand quickly, is an important way to survive.

Actively explore new markets. The person in charge of a small enterprise engaged in machinery and accessories export in North China said that 2021 is the second year since the outbreak of COVID-19. While consolidating old customers, the enterprise also actively expands emerging markets, and shifts from traditional offline channels to online platforms for promotion, gaining many new customers in the Middle East and South America. At the end of the year, the annual export volume of foreign trade increased year-on-year.

Adjust business direction in time. The head of a consumer electronics export company in southern China knows all about it. Since 2020, the company has increased the export of medical supplies and epidemic prevention materials in addition to its main 3C consumer electronics products. "This has enabled us to achieve good overall revenue growth despite the poor performance of our main business." "The official said.

Be proactive in trying new businesses. The person in charge of an enterprise engaged in the export of office equipment introduced that enterprises have a great dependence on cross-border e-commerce platforms. The traffic cost of the platform has been rising in the past two years, forcing enterprises to find another way out, establish independent stations, and gradually form channels and brands. He believes that the epidemic has accelerated China's cross-border trade enterprises to turn to new channels. For example, they used to rely on Google, Facebook and other platforms to win customers, but now many of their peers have focused on short video platforms like TikTok to win customers. "Last year, our overall turnover increased by more than 50%. In the next step, we will take the initiative to expand customers by using the new media platform, and we believe we can make better performance."

Zhao Ping analyzed that the growth of China's export of goods trade benefited from the joint action of domestic and foreign environment. On the one hand, the strengthening of external demand has created favorable conditions for the export of domestic products. On the other hand, China has scientifically coordinated epidemic prevention and control with economic and social development. In the face of repeated global epidemics, China has been able to cope with uncertainties in the international market with a stable supply chain, filling the gap in international market supply, and creating more new growth points. "Small, medium and micro enterprises are small, and they have strong adaptability to the latest changes in the market and can timely seize new opportunities in foreign trade and import." Zhao Ping said that after years of development, China has formed many industrial clusters, a large number of small and medium-sized enterprises through integration into the industrial clusters, the use of industrial ecological advantages to obtain technical, human and capital support, to a certain extent to ensure the source of foreign trade orders.

To help micro, small and medium-sized enterprises to climb over obstacles

-- The entry into force of the RCEP this year will bring new opportunities; Relevant departments will take multiple measures to support the development of small, medium and micro foreign trade enterprises

The Regional Comprehensive Economic Partnership (RCEP), signed by 15 economies including China, 10 ASEAN countries, Japan and the Republic of Korea, came into force on January 1 this year, marking the launch of the free trade area with the largest population, the largest trade scale and the greatest potential for development in the world. Small, medium and micro foreign trade enterprises have also invested more in RCEP.

According to the survey, last year, China's small, medium and micro foreign trade enterprises' export receipts in RCEP region increased by 20.7% year on year. The top three export destinations in RCEP region are Japan, South Korea and Indonesia, and the top three destination countries in terms of growth rate are Thailand, Indonesia and the Philippines.   According to the report, the RCEP regional activity index of Medium, small and micro export shows strong resilience. With the official entry into force of RCEP, the RCEP regional trade of China's medium, small and micro foreign trade enterprises will release more energy.

"Small, medium and micro foreign trade enterprises can take advantage of the RCEP 'zero tariff' preferential agreement rate to reduce import and export costs, so that import and export goods can gain a stronger cost advantage and better meet market demand." Zhao said that after the RCEP takes effect, trade facilitation will be greatly improved, which will save small, medium and micro foreign trade enterprises manpower expenditure in customs clearance and help them expand the market. In addition, the RCEP rules of origin are conducive for large multinational companies to carry out the whole industrial chain layout in the region. Msmes in foreign trade will have more opportunities to integrate into the global supply chain and shift from going it alone to making better use of the supply chain's competitive advantages.

There are opportunities and challenges. Li Xingqian, director general of the Department of Foreign Trade of the Ministry of Commerce, said that in general, on the basis of last year's 6.05 trillion US dollars, 30 percent rapid growth, this year's foreign trade stable growth of difficulties and pressure unprecedented. Small, medium and micro foreign trade enterprises, in particular, have experienced rising costs, high operating risks and pressure, and to varying degrees, "do not dare to accept orders" and "do not increase income".

How to help China's foreign trade enterprises, especially small, medium and micro foreign trade enterprises, continue to climb uphill?

Shu Jueting, spokesperson of the Ministry of Commerce, said that in view of the actual difficulties of small, medium and micro foreign trade enterprises, the Ministry of Commerce will work with relevant departments to study and issue supportive policies to help small, medium and micro foreign trade enterprises to prevent risks, reduce costs and increase vitality. In terms of risk prevention, the Ministry of Commerce, together with China Credit Insurance, strengthened the service support of export credit insurance for micro, small and medium-sized enterprises and expanded the coverage of credit insurance. In terms of cost reduction, we will work closely with the State Administration of Taxation and other departments to continuously accelerate the progress of export tax rebates, optimize tax rebate services, and further reduce the financial pressure on enterprises. In terms of boosting vitality, financial institutions of all types are encouraged to increase credit support to foreign trade enterprises, especially micro, small and medium-sized enterprises, on the premise of being in accordance with the law and keeping risks under control.

"Recently, we issued a Circular on Making Good Use of the Service Trade Innovation and Development Guidance Fund to Support the Development of New trade forms and models, encouraging local governments to make good use of the Service Trade Fund and other direct financing means to ease the financing difficulties of export-oriented smes." Shu Jue Ting introduced. Next, the Ministry of Commerce will implement the policies and measures to stabilize foreign trade issued in January this year and ensure the stability and smooth flow of foreign trade industrial chain and supply chain. At the same time, we will work with relevant departments to guide local governments to continuously improve their business environment and implement tax and fee cuts. In addition, it guides enterprises to promote import diversification, strengthen international cooperation, and build mutually beneficial raw material trade channels. "We will take a combination of measures to help foreign trade companies cope with external uncertainties with the certainty of our policies, and help them climb uphill and achieve steady progress." "Shu Jueting said. (Reporter Liao Ruiling)