Guangxi offers support to cross-border traders
Lower taxes and cheaper goods are helping locals start businesses
The Guangxi Zhuang autonomous region in South China, neighboring Vietnam, is encouraging individual border traders by lowering taxes and reducing the cost of goods, as part of the region’s wider poverty-alleviation efforts.
The region has set up 560 border trade groups to work with manufacturing companies to ensure a stable supply of goods at lower costs. Group members have independent businesses and offer each other help when necessary.
Guangxi is also reducing taxes for individual border traders.
“Guangxi has supporting policies to smooth the trade process, such as one-day passport-free visits that are currently promoted in Dongxing port — which links Guangxi’s Dongxing and Vietnam’s Mong Cai — and also tax-free policies for most goods passing through the port,” said Li Rifa, a director at the managing office of Dongxing port.
“Some individuals who started as cross-border traders have set up small companies, as their businesses have grown,” Li added. Dongxing is China’s third-largest inland port and also the first to support cross-border road trips between China and Vietnam.
Li said that there are still individual traders who cross the border every day.
In 2017, about 13,000 people lifted themselves out of poverty by starting cross-border trade businesses. To date, Guangxi has set up three industrial parks to support poverty alleviation in Longzhou, Pingxiang and Dongxing.
The region has also developed more than 10 border trade related industries and achieved annual output of over 10 billion yuan ($1.47 billion) for cross-border manufacturing. The industries have provided more than 20,000 jobs.
In 2017, total Guangxi border trade climbed to 146.9 billion yuan, of which individual trade made up 63.3 billion yuan, accounting for 74.4 percent of the country’s total.
Li said the most popular goods for export through Dongxing port are electrical equipment, steel, and building materials. The most popular exports for individual border traders are clothes.
“Clothes are favored by individual traders and small businesses as the financial risks are lower,” Li said.
Imports through Dongxing port favored by individual traders are mainly tropical fruits and seafood products, according to Li.
“We are planning a trade fair near Dongxing port,” Li said, “as more people are stepping into the business and the demand for space is surging.”
“Border trades are starting to embrace various forms,” said Li, adding that many people use e-commerce platforms to sell products they import to markets nationwide.
To date, more than 10 impoverished families have started online stores to sell products they have imported from Vietnam, according to news website Sina.com.
“E-commerce use in border trade poverty alleviation is an emerging trend in Dongxing,” said Qi Yousheng, general manager at an e-commerce platform for individual border traders. “The industry is still developing right now, but in the future e-commerce will have more significance in border trade,” Qi added.
Shi Ruipeng contributed to the story.