How Foreign Trade Responds to the Red Sea Crisis

Recent armed attacks on the Red Sea trade artery have attracted global attention. Shipping companies in Denmark, Germany and other countries and regions have made adjustments, increasing the shipping distance between Asia and Europe by 6,000 kilometers (10 days). The solution to the Red Sea crisis has once again sounded the alarm for my country’s foreign trade. Properly expanding the diversity of shipping capacity, route selection and trade network will provide more effective support for the sustainable growth of foreign trade in 2024 and beyond.


Although my country's foreign trade faces huge challenges, its overall scale still ranks first in the world and plays an important role in the global supply chain. There may be two main paths to expand foreign trade blue ocean:


The first is to explore and improve the international network of existing traded goods and establish a more effective path to connect supply and demand. The development of information technology has accelerated the matching of market supply and demand, and trade links among countries jointly building the “Belt and Road” have become increasingly closer. Cross-border e-commerce effectively reduces the ability of buyers and sellers to form transaction intentions, creating better conditions for expanding the diversity of market choices and improving the planning of production and manufacturing. The establishment and implementation of economic and trade rules such as free trade agreements between trading partners should continue to be promoted to provide good expectations for business entities to participate in international trade. Accelerate the development guidance of cross-border supply chains, create good conditions for mutual recognition of standards and rules, promote the integrated development of domestic and foreign trade, and lower the threshold for enterprises and other business entities to participate in international trade. Make good use of import platforms such as the China International Import Expo to increase the scale and product types of imports from more developing countries. Use trade as a link to promote agricultural technology cooperation and increase expectation management through order farming. While providing Chinese consumers with more diversified and high-quality commodities, we can also increase the ability of developing countries to earn foreign exchange through exports. Taking Africa as an example, with the growth of China-Africa trade and the establishment of the African Continental Free Trade Area, trade links between China and African countries have increased, and intermediate goods trade has accelerated. China-Europe trade can gradually form complementarities and mutual promotion with China-Africa trade. development trend, and at the same time realize the development of logistics transportation network and reduce the trade vulnerability of single sea and land transportation.

The second is to meet market demand through model or content innovation to achieve the purpose of improving economic and trade ties and enhancing the development of the global value chain. With the advancement of technology and the development of rules, the integration development between trade in goods and trade in services has accelerated significantly, significantly increasing the possibilities of trade. Since 2023, China's electric vehicle industry has achieved rapid development, and China has become an important automobile trading country in the world. Although the further rapid growth of electric vehicle exports may encounter more resistance and interference, to maintain the stability of trade volume, it is still necessary to increase consumers' use value and improve their use experience from the entire life cycle. In an era of rapid development of digital trade, various digital services attached to products have broad room for development and may form new development relationships between countries and markets to serve the social needs of the digital economy era. High-tech products will be the highlight of China's exports in 2023. China's continued high investment in research and development in various industrial fields and its huge application market have created conditions for the export of goods with higher cost performance, and there is broad room for the development of new markets. Differentiation and personalization will become new demands of consumers. The supply and demand relationship model that reversely defines production and manufacturing from consumption may become more popular. This not only requires the improvement of flexible manufacturing capabilities, but also raises higher standards for corresponding logistics services. Require.

In 2024, China's economy will form stronger development momentum as it continues to expand opening up and promote market integration. Despite this, we still need to respond cautiously to the impact of the Red Sea crisis, make effective use of China-Europe freight trains, further enhance China's resilience in participating in global economic and trade cooperation, and continue to provide strong support for the high-quality development of the Chinese economy.