Introduction

China's manufacturing and processing industry has grown rapidly, relying on the advantages of

land and people. Mechanical and electrical items' export competitiveness has been steadily

improving. Simultaneously, the import trade volume of mechanical and electrical goods is

expanding, owing to domestic economic development needs.

China has been a more active participant in the international trading system since joining the

WTO in 2001.Its imports and exports of mechanical and electrical items have expanded

dramatically, and its place in the international division of labor has steadily improved. The

export volume of diverse mechanical and electrical items is the highest in the world, and the

trade balance has gradually improved from a deficit to a surplus

Export and Import Substitution

China is a populous developing country with abundant natural resources. As China industrializes

and grows, it should gradually shift from an import-substitution to an export-substitution

strategy. China's foreign-trade development plan should be guided by market forces. For the time

being, China would have to continue to produce and export comparative advantage light

industrial items in order to import advanced technology and equipment needed for the country's

development. China will be able to expand its economy, create higher-paying jobs, and raise per-

capita income levels as a result of this change.

In terms of export structure, the Chinese government's duty is to ensure that the domestic

economy and industrial restructuring are capable of supporting a market-driven shift. The

establishment of a central bank with monetary policies comparable to those used by the US

Federal Reserve would aid in the maintenance of a stable macroeconomic environment. Minerals
and energy are abundant in China, and businesses should seize the opportunity to export them

globally. In the absence of competition in certain international markets, China might take

advantage of any monopoly power it possesses.

Another industry in which China enjoys a comparative edge is textiles. Chinese companies can

create these labor-intensive goods at a low cost thanks to their enormous workforce. Because the

global market for these items is so enormous, China should continue to benefit from it. Textiles

and textile-related products currently account for a significant portion of total exports. China

should make full use of one of its abundant resources, labor, to accumulate capital, allowing for a

gradual market-driven shift to more capital-intensive exports. China's local culture is one

industry that is very advantageous to them. Goat skins, herbal treatments, fresh water pearls,

handcrafted goods, and oils are examples of products with distinct eastern characteristics. When

all other factors are equal, a limited supply of a product usually results in a higher price. Chinese

industry should have significant market strength in these industries, which might create

profitable industry prospects with improved production and quality.

China is undergoing industrialization and requires a significant amount of technology and

equipment, as well as raw materials. Prior to 1949, consumer items made up the majority of

China's imports. Reducing excessive consumption during the early stages of industrialization is

critical to ensuring that imported consumer products do not stifle the importation of productive

goods. China’s reliance on imports has led to a decrease in the amount of new technology,

production processes, and machinery. As a result, Chinese businesses must continue to tap into

the global market and import goods that domestic manufacture cannot provide. Production

products, particularly technology and equipment, should be prioritized.

Chinese companies should continue to buy innovative technology and technical equipment from

more developed countries in the future. Imports should be limited to technology and equipment

that cannot be obtained at a cheaper cost from domestic companies, writes Hu Chunyao, vice

president of the Association of Chinese Chambers of Commerce and Industry. Chinese

companies should continue to buy innovative technology and technical equipment from more

developed countries in the future. Imports should be limited to technology and equipment that

cannot be obtained at a cheaper cost from domestic companies, writes Hu Chunyao, vice

president of the Association of Chinese Chambers of Commerce and Industry.

China should stop importing raw materials that aren't readily available in the country. Instead, it

should rely on market forces to import the technology and equipment needed to make items in

high demand around the world. Imports should be sustained only until costs fall as a result of

greater knowledge and productivity. China can avoid a comparable economic disaster, advance

its modernization efforts, and strengthen its position as a financial world power if the right

policies and actions are implemented. China must also construct a structured economic policy-

making mechanism and further strengthen controls for foreign direct investment in order to avoid

the same fate as its neighbors.