China To Reduce Tariffs To Boost Imports

Premier Wen Jiabao chaired a Chinese State Council meeting on the March 28, at which it was decided that, in order to achieve a sustainable balance of foreign trade between exports and imports, and to optimize its mix of imports, China should selectively reduce its import tariffs.

At the same time as maintaining the country’s export trade, the State Council felt that China should also pay increasing attention to increasing its imports to alleviate the pressure on internal resources, speed up technological progress and innovation, boost domestic consumption and, importantly, reduce friction with those of its trading partners with which it runs persistent surpluses.

It was emphasized that the country should expand actively the import of commodities, particularly key energy products and raw materials, and of capital goods, especially advanced technology and equipment, together with a moderate expansion in the import of consumer goods.

In that case, the meeting identified the necessity to reduce the import duties on goods that China does not currently produce, in order to improve living standards and stimulate the growth of strategic industries.

In addition, the government felt that it should recognize the need to implement a policy of eliminating the duties on goods from least developed countries, LDCs, while also guiding businesses to expand imports at reduced tariffs from countries within China’s existing free trade agreements, such as members of the Association of South-East Asian Nations, ASEAN.

Other areas of action will include encouraging banks to carry out import credit business, particularly for advanced technology and equipment and commodities; strengthening cross-border trade in renminbi; and improving the level of trade facilitation at ports and customs, with a rationalization of unreasonable import charges and fees.

April 2, 2012

Source: Tax News