COVID-19 was a storm for China’s foreign trade economy

When the pandemic began, I was still a student. Apart from lockdowns and online classes, I did not feel the direct economic impact of COVID-19. It was not until my parents told me about how the lockdowns affected their work in foreign trade that I understood. My father said that pandemic controls led to the cancellation of his foreign trade orders, since the products he sold were not necessities such as masks or daily supplies, and demand for them had dropped sharply. My mother also worked in a foreign trade company, so our family income shrank significantly.

The impact of this storm on China’s foreign trade was far from isolated; it was supported by solid data. According to official figures from the General Administration of Customs, in the first quarter of 2020, China’s total import and export value fell by 6.4% year on year, with exports dropping by 11.4%. In particular, exports of labor-intensive non-essential goods fell by 15.3%, a much steeper decline than the overall level. Many small and medium-sized foreign trade enterprises, mainly engaged in home goods, clothing, daily necessities and other non-medical necessities, saw overseas demand shrink instantly. Overseas buyers canceled or postponed orders to cut costs, which directly led to production halts and reductions in domestic factories, affecting the entire industrial chain. This was a true reflection of China’s foreign trade during the pandemic.

More seriously, supply chains were disrupted. Cross-border logistics blockades, port congestion and surging shipping prices during the pandemic broke the originally smooth global supply chains. Raw materials could not be imported and finished goods could not be exported, further increasing the survival pressure on foreign trade enterprises and slowing down the manufacturing supply chain. At the same time, factory shutdowns and layoffs in the foreign trade sector worsened youth employment difficulties, with a sharp reduction in related jobs making job hunting harder for new graduates. 

As domestic pandemic prevention policies were optimized, factories gradually resumed work and logistics slowly returned to normal. The government introduced policies to stabilize foreign trade, including tax cuts, financial support and simplified customs clearance, to help enterprises reduce costs. Overseas market demand also gradually recovered. My parents’ orders slowly returned, goods were shipped normally, and China’s foreign trade gradually emerged from the trough.