China's foreign trade has been developing in tandem with the pulse of the country's overall economic development. During the first three decades since the founding of the People's Republic in 1949, foreign trade mainly served as minor leverage for the nation's economic development. The gross trade volumes over this period grew at a relatively sluggish pace, and its trade partners at best numbered merely 40 or so due to political and ideological reasons. With the country's reform and opening-up policies implemented in 1978, and especially since its accession into the World Trade Organization in 2001, foreign trade has turned into a major locomotive driving China's economy forward at a much faster speed. In the process, it has contributed some 20 percent to the country's GDP growth in recent years.
Corresponding to this rising status is the country's changing foreign trade landscape, most notably the export structures and diversified foreign trade operators. Until the new era of reform and opening up set in, primary and resources-based goods remained the vanguard of China's exports, accounting for more than half of the total as of 1978. Nowadays, however, manufactured goods feature prominently in China's annual export portfolio. Official statistics show that they constituted almost 95 percent of the gross value of exports last year, making China a world-class manufacturing powerhouse. The decades-old domination of state-owned firms and their subsidiaries in foreign trade operation, meanwhile, has long given way to virtually all qualified players, foreign-invested and private companies in particular. These two groups held 54 percent and 24.3 percent, respectively, of the market shares in the foreign trade sector last year, a positive step toward creating an open and fair environment for competition and building up a real market economy.
China owes its phenomenal success in foreign trade development to several reasons, of which two clearly have played a decisive role. Primarily, it should be attributed to the country's reforms and opening up, and with this fundamental national policy shift, China began to increasingly make use of external resources to develop its own economy, drawing foreign investment, exploring overseas markets and pushing for free trade and regional economic integration. On the other hand, industrial restructuring and technological transfer that came with economic globalization during the 1980s and 1990s offered an opportune moment for China. As a result, China has emerged as "a world workshop" in name as well as in reality, processing and manufacturing goods for the entire globe.
China's fast-developing foreign trade and economic relations not only have helped speed up the country's economic and modernization drives, but also benefited the world at large by fueling global trade growth and driving economic development around the globe. It proves that the export-oriented strategy is now an integral part of China's development model.