Exports decline because of economic depression
Industry exports in China are being freezing as the global recession has spread so fast. Experts warned that the situation could be worse in the future amid global financial crisis.
According to the Ministry of Commerce in a report on trade outlook, the situation will become more complicated and bring more uncertainties in 2009.
Experts forecast that the government will go on stabilizing exports after adjusting the renminbi exchange rate and export tax rebate. The basic way to make China’s exports constantly competitive is to transform product structure so it can be more proper and encourage enterprise to improve their products, rather than depend on low value-added products.
Since August, the government has adjusted export tax rebates three times. During the last time of adjustment in the beginning of this month, the government raised the export tax rebates for over 1,000 labour-intensive products and for mechanical and electrical products by 4 to 8 percentage points.
The situation last year was totally different. Export tax rebates on many products were scrapped or reduced in 2007.
Pei Changhong, a trade expert said in the Blue Book of China’s Economy that exports could be balanced by government through exchange rate, export tax rebates and policies on processing trade.
Suggestion from Fan Jianping, an expert with the National Information Centre is that stabilizing the exchange rate will lessen the speculation on the appreciation of yuan and make exports more competitive.
Chinese government is expected to continue with its previous policy of controlling energy consuming and polluting industries while optimizing the structure of exports.
The key point is to adjust the product structure and make enterprises more competitive, said Fan.
Fan added that the government should give a hand to the export of products with high quality produced by ourselves, and provide capital and technology to help the SMEs improve their enterprises.
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