China to increase export tax rebates - again
In yet another move to stem the slide in export growth, China’s government announced that they would increase export tax rebates on some 3,770 export items, a little more than a quarter of its exports. It was just a couple of weeks ago that China increased the export tax rebate on toys and textiles. Via China Economic Review, who links to this AFP article:
China’s government has been watching with anxiety as the nation’s export growth has slowed, with many factories in its industrialised south closing and its economy expanding at the slowest rate in five years.
On Sunday, it announced a four-trillion-yuan (586-billion-dollar) stimulus package to be spent on infrastructure and other projects. The plan is aimed at spurring domestic consumption to counter slowing exports.
However, Wednesday’s move showed China was also willing to take steps to ensure the viability of its export industry.
As I mentioned in my previous post regarding the first round of increased tax rebates, what a difference a year makes.
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Atlanta 3pl on Wed, 3rd Dec 2008 10:20 am
China is certainly feeling the pinch of the recession. The U.S. economic problems cause ripples felt through out the world. Increasing export tax rebates? We’ll have to see how the butterfly effect impacts us here in the states.
SwizStick on Tue, 9th Dec 2008 7:45 pm
Yes they are. Increasing export tax rebates and devaluing their currency lowers the cost of Chinese imports here in the U.S. While that’s certainly not what U.S. manufacturers and exporters want to see, the simple fact that we import so much from China could be favorable to the consumer and retailers, as lower first costs from China = higher profit for retailers and/or lower retail cost to consumers.