Chu Shijia (middle), director of the Comprehensive Department of the Ministry of Commerce, at a meeting in Beijing on Tuesday. Photo: Huang Ge/GT

The withdrawal of some manufacturers from the Chinese market should not be directly linked with China-US trade disputes as such withdrawals are normal part of the market economy, a Chinese official said on Tuesday.

Although some companies have moved to other markets as a result of the trade friction between the world's two largest economies, the scale is not large and it is normal for companies that eye global expansion to choose markets with relatively low overall costs, Chu Shijia, director of the Comprehensive Department of the Ministry of Commerce (MOFCOM), said at a meeting in Beijing.

"The comprehensive advantages of Chinese industry chains cannot be replaced by other countries, and will become better after new sectors join in," Chu said.

China has a complete range of industries and mature infrastructure and there are 170 million workers with higher education or professional skills. It also has a large market of 1.4 billion people, and 400 million of them are ranked as middle-class consumers.

Industry chains to be built on 5G and electric vehicles led by Tesla have also integrated, while other companies will expand in overseas markets based on their own needs, Chu said, adding that the withdrawal and integration are normal phenomena under market economy.

The Chinese market continued to see stable increase of foreign direct investment in the first five months, as the value reached 369.1 billion yuan ($53.8 billion), up 6.8 percent year-on-year, the MOFCOM said.

During the period, 100.8 percent growth was reported in investment by German companies, followed by South Korea at 88.1 percent, Japan at 18.9 percent, the UK at 9.2 percent and the US at 7.5 percent, the ministry noted.

China-US trade friction has exerted some pressure on China's foreign trade and investment, but the impact is controllable thanks to the resilience of the domestic economy, Chu noted.

China has unveiled policies to support the stable growth of foreign trade such as sizable tax and fee reductions to help companies lower costs, Zhu Yong, the deputy director of the Department of Foreign Trade of the MOFCOM, told the same meeting.

Zhu said that China is formulating more favorable and practical policies, which are set to be announced in the near future.

"China is also actively promoting the signing of high-standard free trade agreements (FTAs) and regional FTAs with more countries, improving the level of trade facilitation and creating a good business environment," Zhu noted.

China has signed 17 FTAs with 25 trade partners across the globe, Zhu said, noting that China's trade with those partners accounted for 37.9 percent of its total foreign trade in the first five months.


Newspaper headline: China’s industry chains irreplaceable: MOFCOM official