International container freight rates continue to rise as the Ningbo Containerized Freight Index (NCFI) stood at 2,597.4 points in May, reaching a record high. The NCFI has always been recognized as a wind vane of China's busiest port's freight rates for the international container shipping market, suggesting the country’s need for and ability to export containerized goods remains robust.
China’s economic numbers also demonstrate its outstanding performance in international trade and investment. According to the official data released by the General Administration of Customs in May, China's total imports and exports expanded 28.5 percent year on year to 11.62 trillion yuan ($1.8 trillion) in the first four months of 2021, an increase of 21.8 percent from the pre-epidemic level in 2019.
Previous figures given by the Investment Trends Monitor of the United Nations Conference on Trade and Development (UNCTAD) also showed that China's inbound FDI grew against the trend by 4 percent to $163 billion, surpassing the US as the largest recipient of FDI in the world.
During the tumultuous times of the global economy, the pandemic has highlighted the pillar role China plays in the global economy, as its swift domestic economic recovery and strong resilience in exports is impressive. The increasing cargo traffic when other parts of the world were still plagued by the pandemic meant that China’s role in the maritime world and the global supply chain was not largely affected amid the pandemic.
Surging foreign trade was due to China’s new economic paradigm of dual circulation coupled with a number of trade facilitation measures to prevent supply chain disruption and enhance global trade flow including relaxing procedures and requirements for clearance, decreasing the number of declarations, reducing tariffs, enhancing logistic and transport capabilities and so on.
Due to the pandemic, lockdowns and cloud computing have also driven up online shopping, which is also an incentive for the rising container freight rates. Consequently, China also exported a number of home appliances as well as electronic devices to cope with the trends of the so-called “stay-at-home economy”.
As the NCFI is a key component of the Maritime Silk Road Index, which runs under the China-proposed Belt and Road Initiative, this underlines the important role that BRI has played in helping sustain the global supply chain and consolidating global cooperation. Under the BRI framework, China allows enterprises to choose clearance mode for goods transported by the China Railway Express either at ports or at local customs, which greatly improves the transport of goods and supplies, especially medical supplies like vaccines to emerging economies.
For example, the UAE, a BRI participating country, was the first country outside China to approve the mass inoculation of its Sinopharm vaccine. Infrastructure projects under the initiative were also under construction with stringent anti-epidemic measures. The pandemic has also prompted China to orient the initiative towards sustainability, health and digital.
With the pandemic to continue in the future, the BRI and Regional Comprehensive Economic Partnership (RCEP) will sustain their key roles in bolstering international trade and fostering regional value chains. The dual-circulation development model with domestic and international development reinforcing each other will help China to seek better solutions to economic challenges.
