Lessons from the Past in History
Since the 19th century, the United States has repeatedly used tariffs as a means to set up trade barriers. The McKinley Tariff Act of 1890, the Smoot Hawley Act of 1930, and the high tariff policy implemented by the United States towards Japan in 1987 are typical cases. Among them, the enlightenment brought to us by the Japan US trade war is particularly worth learning from.
During the Japan US trade war in the 1980s, Japan proposed the so-called "geese transfer" model to avoid US tariff sanctions, transferring production capacity to Southeast Asia to avoid high tariffs and obtain cheap labor.
Due to Japan's simple supply chain transfer, its essence is simply to switch the industrial chain to another country for production, without changing the nature of the United States being Japan's largest customer, which makes it easy for the United States to trace and collect goods.
In Japan, this round of industrial transfer has also caused a serious wave of unemployment. According to statistics, from 1990 to 2000, the number of employees in the manufacturing industry alone decreased by 2.3 million, equivalent to 3.8% of the local working age population losing their jobs. Later, the excessive transfer of production capacity was also considered one of the important reasons for Japan's economic slowdown in the 1990s.
So, in this round of "tariff war", how should Chinese companies "go global" and set sail?
Reshaping New Forms of Foreign Trade
At the beginning of the year, a video of a "Yiwu boss lady" selling socks through AI went viral on the internet. In the video, the shop owner only needs to say "12345" and can quickly generate marketing videos in dozens of languages with the help of technical tools, matching the tone and mouth shape. These scenes that leave "outsiders" amazed have become a daily routine for tens of thousands of foreign trade merchants in Yiwu and other places.
With the help of AI, the entire process of foreign trade, including production design, display transactions, and trade fulfillment, has been optimized. Cross border e-commerce continues to break through the limitations of time, space, and operating costs, and "24-hour non-stop" is no longer a dream.
Nowadays, new formats such as cross-border e-commerce are reshaping the development model of trade and occupying an increasingly important position in China's foreign trade. In 2024, the import and export volume of China's cross-border e-commerce reached 2.63 trillion yuan, a year-on-year increase of 10.8%. In the past five years, the scale has grown more than 10 times, becoming a new driving force for foreign trade growth.
In response to the global technological revolution and the development of the digital economy, through efficient digital platforms and accessible logistics systems, learning new technologies, seeking new methods, and expanding new channels, Chinese foreign trade personnel have more solutions than difficulties.
Refactoring the 'friend circle' of foreign trade
Data shows that the United States, which gave birth to e-commerce giants such as Amazon and Wish, will achieve e-commerce sales of around $1.2 trillion by 2024, with a market size 9 times that of the entire Southeast Asian market and 32 times that of the Middle East market.
However, when US policies become the "biggest uncertainty factor", can China's foreign trade find other markets to "replace"?
The cooperation between China, Japan, and South Korea will become a major highlight of China's foreign trade this year. The cooperation among the three countries began in 1999 when they jointly responded to the Asian financial crisis. From 1999 to 2023, the trade volume between the three countries increased from 130 billion US dollars to over 700 billion US dollars. South Korea's semiconductors and automotive components, as well as Japan's high-end manufacturing and chemical products, are all sold in large quantities to China, while China's agricultural products, household appliances, and industrial manufactured goods are constantly expanding their market share in Japan and South Korea.
However, the trade dependence among the three countries is still less than 20%, far lower than the European Union (65.7%) and the North American Free Trade Area (40.2%). It is estimated that once the China Japan Korea Free Trade Zone is established, it will form a huge economic circle with 1.587 billion consumers, accounting for 23.4% of the world's GDP.
In addition to China, Japan, and South Korea, ASEAN has become China's largest trading partner with a scale of nearly 7 trillion yuan by 2024, and this number is still growing rapidly today. Of course, China's new space for foreign trade is far beyond these. But it is not difficult to see that China is actively embracing emerging markets with its complete industrial chain, technological innovation capabilities, and expansion into emerging markets.
After all, the world is not just about the United States.
