Foreign Trade Steady Growth Policy Small Increase Export Credit Guarantee Plus $30 Billion

After two consecutive months of low growth in foreign trade, the policy makers finally announced a series of measures to stabilize the growth of foreign trade, but the intensity of the policy was far inferior to that of the previous pretext.

On September 12th, Premier Wen Jiabao chaired the State Council.

The discussion adopted several opinions on promoting the steady growth of foreign trade, and identified eight supporting policies, such as speeding up the progress of export tax rebates, financing, Deguchi Shinbo and trade facilitation.

According to the system, the package stimulus policy has obviously shrunk compared with the previous proposal put forward by the Ministry of Commerce. The Ministry of Commerce has summarized the opinions of the various import and export chambers of Commerce, hoping to raise the export rebate rate of commodities in a large scale, especially some labor-intensive products that involve employment protection.

However, the final decision made by the decision makers only expressly indicates that the export tax rebate will be expedite and the tax rebate will be ensured in an accurate and timely manner.

China

Credit insurance companies disclosed in September 12th that the amount of short-term export credit insurance has been clearly raised from the US $240 billion scale to 270 billion in the beginning of this year, and the new 30 billion quota has been decomposed internally.

In addition, according to the high level instructions of the State Council, the "421 complete sets of equipment special plan" (providing special insurance funds for export financing of large scale equipment) has not only been normalized, but will be arranged as far as possible.

No adjustment in export tax rebate

The trade figures released in August by the General Administration of Customs show that the slowdown or even decline in China's imports and exports is still not improving.

In August, China's exports increased by 2.7% compared with the same period last year, and imports dropped by 2.6%.

After seasonally adjusted, the total value of imports and exports in August has declined, falling by 0.5%.

Wang Qishan, vice premier of the State Council, who was in charge of foreign trade before this spring fair, set up a military order in the seven foreign trade situation forum of East China's provinces and cities, hoping to save all efforts to ensure the realization of the target of 10% foreign trade growth in the country so as to maintain the GDP growth target for the whole year.

But in 1-8 months, China's foreign trade grew by only 6.2%.

The 7, 8, 9 and 10 months are regarded as the peak period of Chinese traditional shipment. The growth of foreign trade during this period determines the overall growth rate of the whole year.

China's trade slowdown happened in 7 and August.

According to the above foreign trade system, the Ministry of Commerce has organized various parties to study the specific policies of the stimulus policy after the data released in the first two ten days of August. These measures mainly include three levels: the export rebate rate of commodities on a large scale, the 15% increase in export credit insurance, and the proposal for RMB exchange rate.

The export rebate rate of labor-intensive products such as shoemaking, toys and furniture has also been raised to 17% from the current 13%-15%.

However, in the final plan, the export tax rebate is only a promise to speed up the tax rebate schedule and ensure that the tax rebate is accurate and timely.

In fact, the acceleration of the export tax rebate process in the first few months of this year may be an important reason for the rebound in exports in 5 and June. According to the Ministry of finance data, the export tax rebate in April increased by nearly 40% over the same period last year.

"Tax rebate acceleration can effectively alleviate the financial pressure of enterprises, but the high growth in 5 and June has overdrawn the export capacity of the following months."

The above interviewed foreign trade personages said.

He analyzed that the export tax rebate policy has not been adjusted at last, and the decision-making level may have two concerns.

First, the downturn in manufacturing led to a general reduction in central and local fiscal revenue. In August, the central government's first negative growth in the year fell by 6.7%.

According to our understanding, the Ministry of Commerce hopes to promote the full refund of export commodities, and no longer use export tax rebates as a means of macroeconomic regulation. The Ministry of finance points out that the value-added tax rate is 17%, but the actual levy is only 12%-13%, so the current export tax rebate rate has reached the upper limit.

Second, the decline in imports has increased the pressure on the trade surplus.

After China's imports slowed down in August, there was a slight decline.

The Ministry of Commerce originally hoped that the surplus could continue to be cut on the basis of last year's US $155 billion 100 million and remained at a little more than 100 billion U.S. dollars a year.

"Now the surplus may exceed $160 billion."

These people said.

China's trade surplus has reached US $120 billion 600 million in 1-8 months.

Export credit guarantee plus $30 billion.

Among the 8 stable foreign trade measures announced by the Standing Committee of the State Council, most of the policies such as credit support and trade facilitation have been fulfilled since the beginning of the year.

In fact, as early as the beginning of this year, the Ministry of Commerce has been deliberate on a series of policies and measures for stabilizing exports. However, the Standing Committee meeting of the State Council has not yet discussed the plan.

At that time, the bad trade data made it unforeseen that the foreign trade will slow down sharply in the next export season.

According to this newspaper's understanding, the support of export credit has clearly defined three directions, and credit funds will be tilted to three types of export enterprises: the enterprises with orders, the exporters of consumer goods with rigid external demand and the enterprises exporting to emerging economies.

Trade facilitation and other issues have also been included in the key research areas of the General Administration of customs. After this, the General Administration of Customs has extensively investigated the situation of trade facilitation at various ports, hoping to solve some specific technical problems that impede trade facilitation.

On the promotion side, the Standing Committee of the State Council once again mentioned that we should actively expand imports, focusing on increasing imports of advanced technology and equipment, key components and daily necessities closely related to the masses.

This year's policy framework for promoting imports before the Spring Fair has been finalized at the Standing Committee meeting of the State Council, which will redefine the scope of luxury goods. However, "the daily necessities that are closely related to the masses" is the so-called tariff reduction of luxury goods.

In this series of measures to stabilize foreign trade, the substantive support measures should be the increase of export credit insurance.

According to sources, the 30 billion increase in short-term export credit insurance was determined after Wen Jiabao's intensive research on the trade situation of several provinces. Wen Jiabao studied foreign trade in Guangdong in late August.

At the end of 5 2009, when China's exports fell to the bottom, the State Council urgently introduced six measures to stabilize external demand. Among them, 84 billion of the short-term export credit insurance underwriting scale (840 plan) was the first of six support measures.

According to the source, this year's 270 billion short-term export credit insurance quotas have three main directions: first, they are inclined to emerging markets such as Africa, the Middle East and Latin America; two, they are inclined to high tech and other key supporting industries; "the quota for shipping industry is quite a few" this year; three, they focus on supporting enterprises exporting Chinese standard and independent brands.

He said that the above three tendencies are in fact consistent with the intention of the Central Committee as a whole to adjust the foreign trade structure.

China's machinery and electronics import and Export Chamber of Commerce said, "421 sets of equipment special plan" normalization operation has been appealed for several years.

Since the outbreak of the financial crisis, many overseas projects have been postponed due to capital flow constraints, and orders for Chinese complete equipment export enterprises are facing a crisis.

Against this background, the "421 special" launched by China has provided overseas buyers with credit support ranging from 2 years to 3 years to more than 10 years, thus preserving overseas orders for some large complete sets of equipment.

According to the chamber of Commerce, large scale equipment and engineering projects cover many industries such as power, telecommunications, metallurgy, petrochemical, rail pit and other industries, and are considered as important carriers for China's foreign trade structure adjustment.

According to the foregoing sources, due to concerns about the difficulty of "ten guarantees" in the foreign trade this year, the State Council senior officials recently requested that the relevant ministries and commissions should meet the approved financing requirements of the complete set as soon as possible in a recent research meeting. This year, the insured limit will not be set up this year, and the units that require the receiving units should give a clear timetable for each supporting fund so as to ensure the efficiency of the plan.

Due to the lack of timely funding, the "421 special plan" in the financial crisis has been delayed until last year.

Data link: the State Council establishes 8 policies to promote foreign trade

1. speed up the export tax rebate to ensure accurate and timely tax rebates.

2., expand the scale of financing, reduce financing costs, and support commercial banks in their efforts to expand trade financing for small and micro enterprises and increase loans to eligible export enterprises.

3., expand the scale and coverage of export credit insurance, and pay special attention to the development of credit insurance for small and micro enterprises.

Expand short term insurance business and support small and medium enterprises to develop international market.

We will seriously implement the special arrangements for export financing insurance of large scale complete sets of equipment.

4., improve trade facilitation.

Simplify examination and approval procedures, improve customs clearance efficiency and reduce customs clearance costs.

Under the premise of effective supervision, the application scope of territorial declaration and port inspection and release will be relaxed to some B enterprises.

Further reduce the statutory list of inspection and quarantine.

The inspection and quarantine fees of all statutory inspection and quarantine items shall be waived in the four quarter of 2012, and the inspection and quarantine charges shall be implemented after 2013.

5., we should properly deal with trade conflicts and safeguard the legitimate rights and interests of our export enterprises.

6., we should actively expand imports, increase imports of advanced technology and equipment, key components, and daily necessities closely related to the masses, support technological pformation and promote trade balance.

7., optimize the layout of foreign trade international market, and support enterprises to develop new markets such as Africa, Latin America, Southeast Asia and central and Eastern Europe.

8., optimize the domestic regional layout of foreign trade, expand the opening up of the central and western regions, and promote the economic and trade cooperation between border provinces and provinces to neighboring countries.