context: The PRC’s trade is under pressure from US protectionism, new tariffs, stricter export controls and global risks. Losing permanent normal trade relations status from the US could also hurt exports. Beijing is looking to expand trade with ASEAN, BRICS and other markets while growing its high-tech industries. Supply chain issues, weak demand and rising costs add to the challenges, necessitating more ‘guidance’ from Beijing.
The PRC’s trade policy faces a critical inflection point as global trade rules shift, geopolitical tensions escalate and domestic policies adjust to new realities, argues Tu Xinquan 屠新泉 UIBE (University of International Business and Economics) WTO Research Institute director, with Jia Linziyan 贾林紫嫣 UIBE WTO Research Institute member.
Global trade disruptions set the stage for policy shifts
- Trump reshaping trade rules
- breakdown of the multilateral trading system and rise of US unilateralism
- reciprocal tariffs challenging most-favoured-nation principles
- tariff-based retaliation disrupting global supply chains
- geopolitical tensions are shifting from unpredictable 'black swans' to neglected but obvious 'gray rhinos’
- US–Russia relations evolving into a non-traditional mode of interaction, challenging established geopolitical dynamics
- US territorial claims involving North American allies and NATO’s internal fractures creating long-term instability in global alliances
Experts forecast three key trade priorities at the Two Sessions based on this background
- stabilising trade volume amid global uncertainty
- expanding export credit insurance from traditional goods trade to digital services and offshore R&D
- integrated supply chain insurance, covering both raw material sourcing and end-product distribution
- establishing a tariff shock emergency fund, providing transitional capacity adjustment subsidies against geopolitical risks
- monitor market diversification, helping Belt and Road trade expansion by identifying alternative markets based on evolving trade risks
- adopting a ‘infrastructure-first’ strategy in emerging markets
- leveraging Regional Comprehensive Economic Partnership implementation to launch Indochina Peninsula Land–Sea Express and PRC–Europe digital twin railway system
- building smart overseas warehouse hubs to support international trade logistics
- improving trade competitiveness
- dual-layer strategy for handling green trade barriers
- industry-level
- establishing a green technology transformation fund, supporting solar firms in building full-lifecycle carbon footprint databases
- policy-level
- advancing PRC–EU green product mutual recognition talks, piloting cross-border carbon tariff offset certificates
- industry-level
- expanding trade innovation in free trade zones, particularly in cross-border data flows
- Shanghai expected to pilot a bonded R&D lab for data asset valuation and cross-border transactions
- accelerating international standards alignment
- domestic adaptation of global standards in home appliances, EVs and manufacturing
- service trade standardisation, expanding mutual recognition for accounting and legal certifications within Greater Bay Area
- dual-layer strategy for handling green trade barriers
- fostering innovation
- pushing digital trade law reform, expediting cross-border e-commerce legislation to resolve e-signature recognition and consumer privacy protection issues
- piloting digital trade hubs in Hangzhou and Shenzhen, testing cross-border data flow whitelists and tax rebate zones for digital services
- achieving full electronic customs clearance nationwide by 2025 via the adoption of digital trade platforms