What will be brought by China's cancellation of registration mechanism for foreign trade business operators?

Estimated reading time: 5 minutes

By Kong Dechen, People's Daily

Since this year, Jiang Meixia, an official with the foreign trade management office of the Chongqing Municipal Commission of Commerce, has been receiving fewer and fewer calls at work.

"In the past, I got many calls asking about the registration requirements for businesses engaged in foreign trade activities every day, but now the requirements have been canceled," Jiang told People's Daily.

The registration mechanism for operators of foreign trade businesses had been in place since 2004. According to the mechanism, enterprises entering or preparing to enter the foreign trade sector must have their information registered before they officially started foreign trade businesses.

To optimize the business environment, the country officially canceled the mechanism on Dec. 30 last year. Companies and individuals no longer need to undergo registration and filing with local commerce authorities and will automatically obtain the right to import and export products to and from China.

This marks a major reform to foreign trade management and is an important step in promoting trade liberalization and facilitation.

The cancellation of the registration mechanism will bring tangible benefits to enterprises.

Sun Yuanxin, chief expert of the Collaborative Innovation Center of China Pilot Free Trade Zone, Shanghai University of Finance and Economics, told People's Daily that in the past, applicants had to visit multiple departments and the registration usually took four to five days.

"The cancellation of the mechanism means that enterprises can directly enjoy foreign trading rights," Sun said, adding that this not only saves enterprises' time and costs and improves efficiency, but also encourages more private enterprises to go overseas and expand both domestic and international markets.

According to statistics released by the State Administration for Market Regulation, the number of market entities in China had grown to 169 million as of the end of 2022, up from 110 million in 2018. Both the numbers of enterprises and individual businesses crossed the 50 million and 100 million marks. Private enterprises are now major players in China's foreign trade sector.

"Canceling the registration mechanism aims to better serve enterprises. This means a lot for small- and medium-sized enterprises that are fresh in the foreign trade sector or planning to do foreign trade businesses in the future. It makes the market more transparent and has further lifted the level of informatization," said Zhang Jianping, deputy director of the academic board of the Chinese Academy of International Trade and Economic Cooperation.

Many experts said that it's a common practice around the world to cancel registration requirements for businesses engaged in foreign trade activities, and the cancellation conforms to China's active strategy of opening up and meets the country's demand to grow from a major trading nation to a leading one.

This year, China will take more concrete measures to better serve foreign trade enterprises.

Li Xingqian, director general of the Department of Foreign Trade of the MOFCOM, told People's Daily that China would roll out new trade policies this year to help enterprises lower cost, expand benefit and tackle challenges as well as improve the comprehensive competitiveness of Chinese foreign trade.

According to him, the country will build closer relations between suppliers and purchasers to stabilize exports. A number of export exhibitions, including the Canton Fair, will resume offline exhibitions. Besides, China will fully support foreign trade enterprises to join overseas exhibitions so as to gain more opportunities.

China will also build closer ties with its trading partners, give play to its advantages as a super-large market, and expand quality imports from other countries, so as to stabilize the global supply chain.

The country will promote the sustainable, rapid, and healthy development of new business forms such as cross-border e-commerce and overseas warehouses. In addition, China will reinforce the industrial foundation for foreign trade, continue optimizing the structure of the foreign trade sector, and encourage processing trade to shift to the central, western, and northeast regions while strengthening general trade.

According to statistics, China's foreign trade in goods for the first time crossed the 40-trillion-yuan mark and reached 42.07 trillion yuan last year, up 7.7 percent from 2021.

"China's foreign trade enjoys a sound structure and has expanded its circle of friends," Zhang said.

The cancellation of the mechanism is an inevitable result of China's institutional opening up, he noted, adding that the country will keep working to stabilize foreign trade and investment, enhance foreign trade facilitation, and build a better institutional environment for the development of foreign trade.