According to the analysis by Xu Changwen from the research institute of world trade and economy of the Ministry of Commerce, the Sino-Japanese economy and trade will continue to rise in 2005.  

In an overall view, the Sino-Japanese economy and trade cooperation will maintain a momentum for a continuous increase in 2005; however, the growth rate is likely to be lower than that of last year.

The first quarter of the year witnessed an increase only of 12 percent in Sino-Japanese trade, which was not only lower by a big margin than the increase rate of 23.1 percent of China's foreign trade but also lower than the trade increase between China and its main trade partners.

This is because the trade increase between the two countries has already seen a bit slowdown in the past few years. And the inertia will continue to go on for some time to come. Besides, the rate of economic growth in Japan will be lower than that of last year and the domestic needs witness a little bit shrinkage as against that of last year, causing the slowdown in its import.

The economic growth in both China and Japan has not only provided a rich source for each other's export but also opened up a broad market for import. Therefore, the major import and export commodities will maintain an increase momentum as a whole. Especially, the export of machinery and electric products, textile goods and chemicals from China to Japan will continue to grow.

This is because China's commodities are of good quality yet cheap in price and moreover. Japan has not exercised as many restrictions on the import of Chinese commodities, such as on textile goods as in the European and American markets and so it is favorable for Chinese commodities to go into the Japanese market.

And along with the economic growth in China due to the domestic needs being on an increase and the expansion in export, the import from Japan will see a continuous expansion.

Due to a stable social order and high-speedy economic growth in China and a continuous market expansion in recent years, China has turned out a magnet attracting direct investment from countries and regions from all over the world, including that from many Japanese enterprises.

Last year saw the introduction of foreign capital reach an actual amount of US$60.6 billion, making China a country to have got in the most direct investment from the world.

The machinery equipment and facilities needed by these foreign capitals after their setting-up enterprises in China are all imported from Japan and this will bring along the import increase by China from Japan.

Up to now, the enterprises set up with three kinds of capitals by Japan in China come up to around 30,000 in number and around 60 percent of the products turned out in these enterprises are sold back to Japanese market. This is also an important factor for the Sino-Japanese trade to be maintained on a continuous rise.

For years on end, the investment by Chinese enterprises in Japan is also being warmed up.

According to an incomplete statistics, so far 129 Chinese enterprises have made their investment in Japan with the invested amount to reach US$89 million and some brand-name Chinese enterprises have already stepped into the Japanese market.

If it sees a continuous improvement of environment for investment in Japan, the Chinese enterprises will also increase their investment there. This will help further the economy and trade development between the two countries.

(People's Daily May 16, 2005)