context: In 2014, a State Council directive brought forward the strategy of 'active import promotion'. The government work report delivered at the 2018 session of the National People's Congress calls for 'actively increasing imports'. Premier Li Keqiang promised to 'cut import tariffs on cars and some consumer goods'.
MofCOM and other agencies are currently drafting guiding opinions on increasing imports to promote trade balance, reports China Trade News. At a time of rising trade tensions between China and the US, the new guidelines could effectively fend off criticism targeted at China and deliver a blow to protectionist sentiment overseas, says the article, which also notes that this move underscores China's commitment to addressing trade imbalances with other countries and to trade liberalisation.
Import of end products has been low over the years, it says, noting
- for the past 40 years, China has mainly imported raw materials and intermediate products to support exports, while import of end products has been constrained by high tariffs and non-tariff barriers
- China's import of end products accounts for only five percent of total imports, while the world average is about 20 percent
- China's per capita import of consumer goods is about US$36, much lower than America's US$996 and lower than ASEAN average US$198
Increasing imports of consumer goods, says the article, can yield benefits including
- replacing conventional export-oriented measures to more balanced trade policies
- answering the 'people’s demand for a better life' and winning domestic political approval
- promoting high-quality economic development by addressing problems caused by the export-oriented development model, such as environmental pollution, depletion of resources and lack of industrial innovation