Policies aim for steady trade growth
We should support steady growth both in exports and imports to advance the country’s industrial upgrade and attract new foreign investment beyond that which is already in the Chinese market.” Premier Li Keqiang
China will reinforce existing policies and streamline administrative procedures to promote steady growth of imports and exports, the government announced on Tuesday.
Tuesday’s State Council executive meeting, chaired by Premier Li Keqiang, focused on key problems concerning the implementation of trade policy and measures needed to address them.
Li said the sluggish global outlook and weak overseas demand have undermined efforts to shore up China’s trade volume. Rising domestic manufacturing costs also have consequences for China’s imports and exports, he said.
A number of policies have been adopted by the government since 2013 to encourage the steady growth of foreign trade, and China remains the world’s largest trading nation in goods in recent years. Yet because of the global financial crisis and resulting slowdown, China’s foreign trade growth has lost some momentum.
Customs figures show that in the first half of 2016, China’s foreign trade stood at 11.13 trillion yuan ($1.68 trillion), a drop of 3.3 percent year-on-year, while exports amounted to 6.4 trillion yuan, down by 2.1 percent. Imports decreased by 4.7 percent to 4.73 trillion yuan, but the country’s trade surplus increased by 5.9 percent to 1.67 trillion yuan.
“We should support steady growth both in exports and imports to advance the country’s industrial upgrade and attract new foreign investment beyond that which is already in the Chinese market,” Li said.
High financing costs for companies remain a major burden in maintaining trade growth. Other problems include sluggish trade policy implementation as well as outdated management methods, according to experts.
A third-party evaluation conducted by the State Council’s Development Research Center in July found that China’s trade faces headwinds from deep adjustments in the global economy, as well as from the country’s economic transition.
The center’s evaluation also found that officials were not sufficiently aware of the problems that would be encountered in policy implementation, and the country has not firmly established its competence in technology, branding and marketing in the global market.
More measures will be introduced to ensure the steady growth of China’s foreign trade, according to a statement released by the State Council after the meeting.
For example, detailed adjustments will be made to existing policies to better facilitate foreign trade development and to streamline procedures in trade gateways.
Financial institutions will be encouraged to provide more credit support to enterprises with substantial business profits. And export credit insurance will cover a wider range.
In addition, procedures for tax reimbursement for exports will be more efficient, and unnecessary harbor and shipping costs will be reduced, the statement said.
Also, policies will be further adjusted to facilitate newtypes of trade, such as cross-border e-commerce. The role of bilateral investment will be further encouraged to boost foreign trade, by promoting the country’s Belt and Road Initiative and international cooperation on capacity, the statement said.
Equipped with big data systems, many Chinese companies’ products and supply chain systems have already experienced dramatic changes. Many companies have begun to adjust their supply chain networks for different products based on big data about demand in foreign markets, said Zhao Ying, a researcher at the Institute of Industrial Economics at the Chinese Academy of Social Sciences.