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A senior Chinese trade official vowed this weekend to promote the market orientation, legalization and stabilization of China's export-support policies.
"We will reduce direct interference in corporate business and make more use of market means, such as public bidding and government purchases, to expand our export business," said Fu Ziying, director of the Planning and Finance Department of the Ministry of Foreign Trade and Economic Co-operation (MOFTEC).
He said the ministry will work harder to provide exporters with financial and information services to support export expansion.
The director spoke at the mid-year national conference on exports, which MOFTEC held on Friday and Saturday. More than 70 senior MOFTEC and provincial trade officials participated.
He said China's current export-support policies have been tainted by the lingering influence of the old planned economy.
China, for example, still has a quota on its tax rebates for exports, and a complicated approval procedure for investing in overseas projects. China plans to give 125 billion yuan (US$15.1 billion) in tax rebates for exporters.
The country's foreign trade development fund, a major support for foreign trade, is made up mostly of income from public bidding. And the quota for the tax rebates for exporters depends heavily on the condition of the government's financial budget.
Fu said MOFTEC is working with the Export and Import Bank of China and China Export Insurance Co on a law on credits and insurance for exporters.
And along with the Ministry of Finance, MOFTEC is drafting a plan to grant more exporters tax exemptions instead of tax rebates because it would help with their capital flow, he said.
The Chinese Government has realized that its policy support for exporters doesn't match well with the expanding scale of its exports, let alone those of developed countries, he said.
China's insurance for exports, for example, accounts for only 1 per cent of its total exports, compared with 12 per cent in most developed countries.
(China Daily July 22, 2002)
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