Data Watch on China’s Foreign Trade and Investment in January 2012

China’s foreign trade in January 2012

According to statistics of the Customs， China’s exports and imports in the first month of 2012 reached $272.6 billion， down 7.8% over last year. Specifically， exports stood at $149.94 billion， down 0.5% year on year; imports $122.66 billion， down 15.3%. The month saw a trade surplus of $27.28 billion. The 2012 Chinese Spring Festival， which fell on January， factored into the data.

Modest growth in exports under the general trade; significant decline in imports under the processing trade. In January， China’s general trade value dropped by 5.4% year on year to $151.53 billion， compared with the 7.8% drop in the nation’s total trade volume. Specifically， exports increased 2.6% year on year to $76.77 billion， while imports fell by 12.5% to $74.76 billion. The nation’s processing trade value dropped by 9.8% year on year to reach $92.76 billion. Specifically， exports fell by 2.6% to$62.64 billion， while imports fell by 19.9% to $30.12 billion.

Steady increase in trade with some emerging markets; slow down of increase in exports to the European Union. In January， China’s bilateral trade with Russia， Brazil and some other emerging markers reported increase over the same period of last year. The nation’s trade with Russia increased by 26.8% to$7.16 billion， and that with Brazil increased by 5.7% to $6.34 billion. China’s trade with the EU fell by 3.2% from last year， with exports to Germany down by 6.3% and to Italy down by 28.2%. The nation’s exports to the United States and Japan reported marginal increases of 5.4% and 6.1%.

Significant increase in exports of central and western China; decline in exports of some provinces in eastern China. In January， exports of central and western China rose by 17.2% and 19.3% respectively. Exports of Chongqing， Henan， Guizhou and Jiangxi provinces increased by 1.1 times， 1.1 times， 19.6% and 23.5% respectively. Exports of the ten eastern provinces fell by 2.5%. Exports of Guangdong， Jiangsu and Shandong provinces dropped by 9.2%， 3.9% and 3.2% respectively.

No fluctuation in exports of traditional labor-intensive commodities; drop in imports of raw materials. In January， exports of plastic products， toys and apparel increased by 5.4%， 4% and 3.5% respectively. Exports of bags， textiles， footwear and furniture fell by 7%， 6.8%， 1.3% and 2% respectively. The above seven kinds of labor-intensive goods accounted for 22.4 percent of China’s total export value in January. The nation’s imports of iron ore and concentrates， plastic in primary forms， natural rubber， unwrought aluminum and aluminum products fell by 13.9%， 26.8%， 8.1% and 4.4% respectively， with their prices down by 11.0%， 3.8%， 24.1% and 12.8 % respectively.

Steady increase in exports of private corporations; lower proportion of imports of foreign-funded enterprises. In January， exports of foreign-funded corporations registered $75.33 billion， down 2.8% from the same period of last year， and imports $56.56 billion， down 21.0%. Exports of private corporations increased by 3.2% while their imports fell by 16.7%. Exports of State-owned enterprises dropped by 1.0% and imports by 4.4%.

Utilization of foreign investment

In January 2012， China approved the establishment of 1，402 new foreigninvested enterprises， a decline of 37.49% year on year. The nation utilized $9.997 billion worth of foreign capital， a decline of 0.3% from the same period of last year.

Significant increase in the utilization of foreign capital by such sec-tors as agriculture， forestry， animal husbandry， and fisheries. In January， the sectors of agriculture， forestry， animal husbandry， and fisheries made an actual use of $197 million in foreign investment， an increase of 40.14% year on year， with its proportion in the nation’s total value up by 0.56 percentage points from the same period of last year. Specifically， the agricultural and husbandry sectors saw 191.37% and 72.95% increases in utilization of foreign capital respectively. The manufacturing industry made an actual use of $4.698 billion in foreign investment， a decline of 0.04% over the same period of last year and accounting for 47% of the national total. The service industry made an actual use of $4.471 billion， a decline of 4.62% year on year， and accounting for 44.72% of the national total.

Steady increase in investment in China from Asia nations. In January， paid-in capital from the ten Asian nations or regions (Hong Kong， Macao， the Taiwan province， Japan， Philippines， Thailand， Malaysia， Singapore， Indonesia， and South Korea) was valued at$8.586 billion， an increase of 0.77% year on year. Paid-in capital from the United States amounted to $342 million， up by 26.07% from the same period of last year. Paid-in capital from the 27 European Union nations fell by 42.49% to$452 million.

Actual use of foreign investment in central and western China outgrew the eastern regions of the nation. In January， the eastern regions made an actual use of $8.562 billion in foreign investment， a decline of 4.63% year on year and accounting for 85.64% of the national total. The central regions made an actual use of $834 million， an increase of 54.6% and accounting for 8.35% of the national total. The western regions made an actual use of $601 million in foreign investment， an increase of 17.83% year on year and accounting for 6.01% of the national total.

Overseas investment and economic cooperation

China’s outbound FDI In January 2012， China’s domestic investors invested directly in 355 overseas corporations in 87 nations and regions， with a total of non-financial outbound FDI of $4.376 billion， an increase of 59.9% year on year. By the end of 2011， China’s domestic investors had set up 18，000 FDI enterprises in 178 nations and regions， with a total of non-financial outbound FDI of $322 billion.

Overseas-contracted projects In January， China’s overseascontracted projects reported a turnover of $5.87 billion， an increase of 38.4% year on year. $9.33 billion worth of new contracts were signed， down by 10.2% year on year. 32 of the new projects were of a contract value of over $50 million， with a total contract value of $7.07 billion， representing 75.8% of the total value of the newly-signed contracts. 23 of the new projects were of a contract value of over $100 million， 12 more than the same period of last year.

Foreign labor service cooperation In January， the number of all kinds of labor sent abroad was 29，000， an increase of 5，000 year on year. At the end of January， there were a total of 811，000 Chinese working abroad， 3，000 less than the same period of last year.

Service outsourcing

In 2011， China witnessed rapid increase in service outsourcing. Chinese enterprises implemented $32.39 billion worth of contract of service outsourcing， an increase of 63.6% from the year 2010. Ofall the contracts， international offshore service outsourcing contracts registerted a total value of $23.83 billion， an increase of 65.0% year on year， 22 percentage points higher than 2010. China’s share of the international higher market of service outsourcing has been on the rise. In 2011， China took 23.2% of the global service outsourcing market， 6.3 percentage points than the year 2010.

The United States， Europe and Japan are the major sources of China’s service outsourcing contracts. In 2011， China implemented$16.43 billion worth of offshore service outsourcing contracts from the U.S.， EU， Japan， Hong Kong and other countries (regions)， accounting for 68.9% of the nation’s total.

Eastern China is where the nation’s service outsourcing industry concentrates. In 2011， Jiangsu， Shanghai， Guangdong， Beijing， and Zhejiang implemented $17.78 billion worth of international offshore service outsourcing contracts， accounting for 74.6% of the nation’s total. Eastern China implemented $20.86 billion worth of offshore contracts， accounting for 87.5% of the nation’s total. Central and western China has seen rapid development in terms of undertaking service outsourcing contracts and has strong potential. Its increase rate in value of implemented service outsourcing contracts doubled that of eastern China.

Chinese enterprises undertaking service outsourcing contracts are mainly medium-sized ones. Accounting for 2.9% of China’s total number of enterprises， medium-sized service outsourcing enterprises implemented 51.2% of China’s offshore service outsourcing business. There were 22 big Chinese companies that implemented over $100 million worth of service outsourcing contracts， 7 more than the year 2010 and accounting for 0.1% of the total number of enterprises. These companies completed 16.4% of the total value of the service outsourcing contracts China received. They are expanding rapidly.

Service outsourcing has become a new job-creating sector. In 2011， 865，000 new jobs were created in the sector of service outsourcing， among which 582，000 were for college students. By the end of 2011， there were 16，939 service outsourcing enterprises in China， employing 3.182 million people， 70.1% of whom were college graduates.