China's latest cuts to import duties will reduce fiscal revenue while boosting domestic consumption, said vice finance minister Shi Yaobin on Friday at a press conference.
The Ministry of Finance (MOF) announced on Monday that China will cut import taxes on clothing, cosmetics and some other goods from June 1.
The MOF said that it will slash duty by half, on average, on suits, fur garments and shoes. A tariff on cosmetics will fall to 2 percent from 5 percent, while a duty on diapers will decline to 2 percent from 7.5 percent.
There is no doubt that the cuts will reduce fiscal revenue, said Shi, while declining to give an exact amount, but he did not expect revenue to decrease too much given that more imported goods mean more import tax revenue.
With strong purchasing power, Chinese mainland travelers often buy goods as diverse as diapers and handbags abroad to avoid import and consumer taxes back home. Mainland tourists abroad spent $165 billion in 2014, up from $129 billion in 2013.
Wednesday, 10 June 2015
Saturday, 2 May 2015
Duties on rare earth exports to be ended in China
Here is the good news for some rare earth importers worldwide:
Export duties on rare earths will be eliminated on May 1, 2015, the Ministry of Finance said in a statement on Thursday, a move that analysts said would stimulate China's exports of the limited resource.
Rare earths－a group of minerals that are crucial to the technology and defense industries－as well as tungsten and molybdenum will be exempt from tariffs, and wrought aluminum products will also enjoy a zero rate, the statement said.
The move, according to Du Shuaibing, an analyst at natural resources consultancy Baichuan Information, will reduce the prices of rare earths by 20 to 25 percent.
"Rare earth export volumes are expected to increase greatly, which will help producers digest inventories," said Du.
The move also will also have an impact on international rare earth prices, because lower-priced exports from China will affect sales of rare earths produced in other countries and regions.
The metals are used in products as varied as iPhones and wind turbines.
In 2014, rare earth exports reached 28,000 metric tons, up 27.3 percent from a year earlier. The average export price was 83,000 yuan ($13,300) per metric ton, down 47.8 percent.
But Du said that resource and environmental taxes on rare earth producers, which have caused production costs and therefore prices to rise, are still the primary concern in the market.
It is also crucial to crack down on illegal mining and smuggling, factors that lead to an oversupply, Du said.
China's six major rare earth groups, which dominate exports, are expected to complete most of the work necessary to integrate small mines and smelting companies by the end of 2015.
China is the world's largest producer and exporter of the minerals, but the industry is beset by problems including illegal mining, smuggling and a lack of competitiveness due to weak research and development.
The country raised tariffs and imposed strict output quotas in 2010 to not only protect its scarce resources, but also reduce the environmental impact of extraction. Importers in Japan, Europe and the United States complained that the move had breached trade rules.
Shares in producers of rare earths surged on Thursday after the duty change was announced. But Du said that participants in the industry will take a more measured view of policy changes.
Key movements for the industry
Before 2003: Exports are encouraged with rebates
2003-06: Exports are restricted, with rebates phased out
2006-14: Ceilings on exports are raised, export tariffs hiked annually
Jan 1, 2015: Tariff implementation plan enforced
Buyer Fraud Case: How Chinese Importer Scam You in China
Recently one of our South African clients lost more than 5000 USD by a 'fake’Chinese importer. They were offered a huge order valuing more than 9,000,000.00 USD and were invited to China to attend a so-called contract signing ceremony. The professional fraudsters have too many ‘pretexts’ to get money from the victims worldwide: notary fee, kickbacks, gifts, bribes etc. It is even hard for the local police to crack down such cases as they use all fake names and official documents in China. In order to warn more reliable businessmen worldwide, STIN Company Verification team summarized the features of China international buyer fraud case for your reference.
Features of Chinese import fraudsters:
1.Fully registered a NEW offshore trade company in Hongkong, with a created address and a created company name in Mainland China. Please note that they will use 'fake’identity cards to register the offshore trade company in China as well.
2.Leased a luxurious office temporarily, with at least three ‘actors’, one is act as a ‘president or CEO’, one act as a financial director and the other act as an ‘importer manager’ or assistant.
3.The offer (contract value) is very attractive and huge, valuing more than 1 million USD at least or even tens of millions USD, with favourable payment terms, say, 30% in advance by T/T within 24 hours upon the signature of the contract in person.
4.Claimed to be a big group company, with a wide range of business: trade, distribution, investment, manufacturing and so on. They claim to import all kinds of items from other countries.
5.Constructed a website, with many items on, disguised to be a group company online. They used an official company email box as well.
6.Used automatic Group Mailing system and they can sent tens of thousands of emails every day. If the receiver responds, then a guy will follow up by email and the trap begins. They never attend the trade fairs or shows in China.
7.Insist on signing the contract in person in China and they will invite you to attend their so-called Contract Signing Ceremony.
8.Insist on NOTARIZING the contract and they will appoint (designate) a local Notary Office (but normally this notary office is a NON-EXIST one in China.).
9.Used ‘fake’ Chinese invoice and Chinese official licenses.
10.Used ‘fake’ signature, they do not sign their names in full.
According to the case-reports from our clients so far, 99% of above notorious scammers are from Henan (Zhengzhou city) and Guangxi (Guilin city) etc, China at present.
How they TRAP you STEP by STEP ?
First: Use automatic group mailing software to send you attractive offers and inquiries, with created official websites and email boxes. Formal documents, formal address, websites and bank accounts etc, everything seems to be normal.
Second: Invite you to sign a formal Purchase Contract in person in China.
Third: Insist on notarizing the contract and they will use a non-exist notary office to notarize the document, then all the notary fee will be in their pocket.
Fourth: Asking you for ‘kickbacks’ or ‘bribes’ in lot of ‘pretexts’ in China.
Fifth: After they get all those money, they will disappear and replica the scam again.
What are the Countermeasures against these Professional Business Fraudsters?
First: Ask the importer for their Business License and Import License before your departure to China, then checking out their registered information with local officials first.
Second: Book a professional Company Verification or Investigation service from a third-party service company, checking them out before further discussion.
Third: Appoint a local representative and visit them first before your departure to China, they are NOT able to cheat local experts. .
Fourth: Never pay anything before receiving the deposit from the importer.
No matter you’re buying or selling, Due Diligence work is always important in China. Think it over before you pay out even one penny !
Key words:China import fraudster, China fake importer, China import fraud case, fake Chinese importer, Chinese buyers, fake Chinese buyers, China buyer fraud case, China company verification service, importer scam, importer business fraud
Thursday, 2 April 2015
How to Find a Good China Buying Office, Sourcing Agent or Purchasing Agent
A good Buying Office, Sourcing Agent or Purchasing Agent plays a very important role in doing safe and smooth business in China, especially when you're placing a large order: Sourcing and Verifying qualified suppliers, Quality Control, Loading Process Supervision, Warehousing, Shipping Support, Business Risk Control, Legal Contract Support and After-sale service etc. However, It is NOT easy to find a right one. If you don’t make an informed decision when selecting a buying office or purchasing agent you might end up losing a lot more than the commission or service fee.
What is a purchasing agent and why do I need one?
A purchasing agent could be an individual, a group of team or a company, helping companies overseas to import from China. So sometimes buying office service can also refer to 'purchasing agent', Buying Office service will be supported by a team of experts in each field: sourcing, verification, procurement, quality control, business risk control etc. A good agent can be an extremely valuable asset in your overall product procurement strategy. Here are the main services offered by your qualified ‘buying office’ or ‘purchasing agent’ in China:
I. Keeping finding new products and suppliers.
II. Verify, inspect or audit existing suppliers.
III. Price negotiations and Supply Chain Management
IV. Draft formal Purchase Contract (Business Risk Control)
V. Quality Control Management
VI. Shipping Supp ort and Loading Process Supervision
VII.Customs Clearance Support
VIII.Offer After-sale Service
Dealing with Chinese suppliers is very time consuming. Working with a qualified Buying Office or Purchasing Agent can save you much time, cost and energy etc in China. For example, 90% of the suppliers you met online or at local trade fairs might be a typical trade company while the local sourcing specialists can go to the real manufacturing bases to find out some qualified factories for you in person. Apparently the factory price is much more competitive than that of the trader’s anywhere on the globe, by this way you can save more cost in the business.
How to choose a right buying office or purchasing agent from China?
I. Ask them for at least 3 client references from your country or area.
Check them out before any cooperation. Trust is very important, especially for long term cooperation.
Check them out before any cooperation. Trust is very important, especially for long term cooperation.
II.Choose a right buying office or purchasing agent who is near to the manufacturing base ( industry cluster) of your industry.
In China, almost every city has their pillar industry and each product has one or several manufacturing bases. Say, if you're buying Fireworks, you can simply go to Liuyang city, which is called 'Home of Fireworks' or 'Capital of Fireworks', where there are more than 400,000 people directly or indirectly engaging in this business in China. 'Liuyang-made' fireworks account for 70% of China market and 50% of global market at present. Another two famous manufacturing bases for this product is Liling, Hunan and Wanzai, Jiangxi, these three manufacturing bases are near to each other. This is the same situation to most of the products in China. Your agent’s proximity to a certain industrial cluster can certainly help out when things go wrong during production. It may also cut traveling and transportation costs.
III.Ask them for their Business License and Export License in China, check them out with local officials or third-party verification service company first before formal cooperation.
IV. Ask them for the measures on how to avoid ‘kickbacks’ from the suppliers.
When you are working with a small buying office, especially for individual purchasing agent, they may choose the supplier based on the kickback amount and will not protect the client’s interests in China. This is a problem of management issue. It is very hard to eradicate ‘kickback’ but if some well-known ‘buying office’ may have lot of experience in avoiding it.
V. Ask them enough professional questions regarding the coming orders in China.
Many sourcing agents are also lacking expertise about product safety regulations in overseas markets. Working with a buying office or procurement agent lacking such knowledge is a serious liability. Keep in mind that in the end, you are going to be held financially responsible if your products turn out to be non-compliant with the relevant standards. Importing from China can be a completely different story depending on the product. Certain products are very complicated (i.e. machinery ) while others a fairly easy to get right (i.e. indoor furniture). Hiring the a purchasing and procurement agent with the right product knowledge is critical and can make the difference between a successful business transaction and complete disaster.
If they are able to satisfy you from above five aspects and if they are familiar with the manufacturing bases in China, then you can feel assured to work with them in China. STIN Buying Office service has served more than 2000 clients from over 80 countries and areas on the globe so far. You can have a look at their website for details: www.chinabizservices.com You can also watch their services online: http://youtu.be/IaoSngoycIo
Monday, 30 March 2015
L/C Fraud Case: How Chinese Exporter Scam Under L/C Terms
L/C (Letter of Credit) is considered to be the best payment terms during international business, especially for large orders. However, there are still some professional scammers using L/C to rip off the clients worldwide. They either used forged, altered documents or invalid, revocable L/C to cheat the client. Recently we witnessed two L/C fraud cases from China, one client lost nearly 600000 USD (ordered copper wire but received sand) and the other 70000 USD (ordered chemicals but received stones) respectively.
In order to warn more reliable businessmen worldwide, STIN verification team summarized the features of China L/C fraud case for your reference.
Features of Chinese L/C business fraud:
1.Fully registered NEW trade company and exporter but disguised as real manufacturers online;
2.Insist on using their own Shipping Agent
3.Only accept irrevocable 100% LC at sight terms
4.Only deal with large orders and focus on some hot-selling raw materials, say, chemicals, ingots, used cooking oil, rare earth etc.
5.Offer well-known third-party certifications, say, SGS test report
6.Offer high quality samples for FREE sometimes to gain trust from the clients
7.Use very low prices to attract the clients worldwide. (Far below the market price)
8.Scammers are normally from North China at present.
According to the case-reports from our clients, Shijiazhuang, Zhengzhou, Qingdao, Dalian, Tianjin etc is notorious for such business scams in China.
How Chinese Scammers Cheat You Under L/C Terms?
The scam chain seems to be very complete now, from marketing to sourcing, from shipping to documentation, from certification to consulting etc are all well planned. According to our investigation and verification result in China, the professional scammer normally takes following steps to rip you off:
First: Company Registration and Market Survey
Scammers will register a real small trade company in China, but faraway from their hometown. Say, if they are from Hebei, they may register a company in Shandong or even in Hong Kong. Or they will use an offshore trade company to work with you and they are NOT registered in China at all. The professional business fraudsters will do a small market survey on all the hot-selling items on the globe and then they will construct a professional website for some certain products or even for all the hot-selling items. One of the scammers was seen to construct a website with more than 100 hot-selling items online. Please note that they will create a ‘fake’ address online in English even if their company is registered officially. Also please note that the professional scammers will use ‘fake’identity card or 'steal’a real identity card to register any company.
Second: Promotion and Internet Marketing
After the first step, the professional business fraudsters will use internet to promote their items, they will pay for some SEO marketing professionals in China, so their information can be easily reached by some real buyers. They even paid for some Gold members with some famous B2B platforms, where more reliable businessmen would be cheated.
To attract the clients, they also use Free high quality samples and third-party certification, say, SGS test report etc. This is one of the main reasons that the victim get trapped.
Third: Pricing and Trade Terms
Most of the buyers were trapped by their extremely low prices. As for the trade terms, they will insist on irrevocable 100% LC at sight terms, which seems to be normal to all the big client.
Fourth: Shipping and Domestic Logistics
The scammer will 'buy'documents from the shipper or their shipping agents and they will insist on using their own shipping agent in China. Some scammers conspire (plot together) with the shipping agent (truck drivers), they can change the goods inside the container on the way to the yard with a fake seal number (or they even dismantle the container door without breaking the seal number.). This is another key reason that the client get scammed.
Fifth: Receiving Money and Disappear
The professional scammer will write off (annul) all their registered company licenses and documents as soon as they receive the money from the client, then disappear. It is hard even for local police to trace them as they used all ‘fake’ names and identity cards in China.
Sixth: Replicate their Business Fraud elsewhere
If they are NOT put in the prison, they will replicate the experience and scam another victim elsewhere.
What are the countermeasures against these Professional Business Fraudsters?
All the business fraud can be avoided if you take following advice in China:
First: Use third-party professional Factory Auditing or Company Investigation service to fully check them out first before placing any large orders.
Second: Insist on using your own Shipping Agent to arrange all the delivery and logistics.
Third: Use a third-party Pre-shipment Quality Control Inspection service to check the quality level at their factory before loading.
Fourth: Use a third-party Loading Process Supervision Service to supervise the loading process in China.
Fifth: Work with a local buying office to control the business risk, offer legal consulting, supervise the whole business process and follow up the after-sale services etc when necessary.
There might be lot of other forms of L/C fraud in other countries, any comment is welcome.
STIN Verification Service Team is committed to reducing the business risks, fighting against business fraud and saving you more time, cost and energy etc in China. STIN main services are: Chinese Company Verification and Investigation, Factory Auditing, Professional Sourcing, Quality Control, Purchasing Agent Service etc. STIN service team is also offering a ONE-STOP procurement solution service for their clients worldwide in China: www.chinabizservices.com
or visit us online: http://youtu.be/IaoSngoycIo
In order to warn more reliable businessmen worldwide, STIN verification team summarized the features of China L/C fraud case for your reference.
Features of Chinese L/C business fraud:
1.Fully registered NEW trade company and exporter but disguised as real manufacturers online;
2.Insist on using their own Shipping Agent
3.Only accept irrevocable 100% LC at sight terms
4.Only deal with large orders and focus on some hot-selling raw materials, say, chemicals, ingots, used cooking oil, rare earth etc.
5.Offer well-known third-party certifications, say, SGS test report
6.Offer high quality samples for FREE sometimes to gain trust from the clients
7.Use very low prices to attract the clients worldwide. (Far below the market price)
8.Scammers are normally from North China at present.
According to the case-reports from our clients, Shijiazhuang, Zhengzhou, Qingdao, Dalian, Tianjin etc is notorious for such business scams in China.
How Chinese Scammers Cheat You Under L/C Terms?
The scam chain seems to be very complete now, from marketing to sourcing, from shipping to documentation, from certification to consulting etc are all well planned. According to our investigation and verification result in China, the professional scammer normally takes following steps to rip you off:
First: Company Registration and Market Survey
Scammers will register a real small trade company in China, but faraway from their hometown. Say, if they are from Hebei, they may register a company in Shandong or even in Hong Kong. Or they will use an offshore trade company to work with you and they are NOT registered in China at all. The professional business fraudsters will do a small market survey on all the hot-selling items on the globe and then they will construct a professional website for some certain products or even for all the hot-selling items. One of the scammers was seen to construct a website with more than 100 hot-selling items online. Please note that they will create a ‘fake’ address online in English even if their company is registered officially. Also please note that the professional scammers will use ‘fake’identity card or 'steal’a real identity card to register any company.
Second: Promotion and Internet Marketing
After the first step, the professional business fraudsters will use internet to promote their items, they will pay for some SEO marketing professionals in China, so their information can be easily reached by some real buyers. They even paid for some Gold members with some famous B2B platforms, where more reliable businessmen would be cheated.
To attract the clients, they also use Free high quality samples and third-party certification, say, SGS test report etc. This is one of the main reasons that the victim get trapped.
Third: Pricing and Trade Terms
Most of the buyers were trapped by their extremely low prices. As for the trade terms, they will insist on irrevocable 100% LC at sight terms, which seems to be normal to all the big client.
Fourth: Shipping and Domestic Logistics
The scammer will 'buy'documents from the shipper or their shipping agents and they will insist on using their own shipping agent in China. Some scammers conspire (plot together) with the shipping agent (truck drivers), they can change the goods inside the container on the way to the yard with a fake seal number (or they even dismantle the container door without breaking the seal number.). This is another key reason that the client get scammed.
Fifth: Receiving Money and Disappear
The professional scammer will write off (annul) all their registered company licenses and documents as soon as they receive the money from the client, then disappear. It is hard even for local police to trace them as they used all ‘fake’ names and identity cards in China.
Sixth: Replicate their Business Fraud elsewhere
If they are NOT put in the prison, they will replicate the experience and scam another victim elsewhere.
What are the countermeasures against these Professional Business Fraudsters?
All the business fraud can be avoided if you take following advice in China:
First: Use third-party professional Factory Auditing or Company Investigation service to fully check them out first before placing any large orders.
Second: Insist on using your own Shipping Agent to arrange all the delivery and logistics.
Third: Use a third-party Pre-shipment Quality Control Inspection service to check the quality level at their factory before loading.
Fourth: Use a third-party Loading Process Supervision Service to supervise the loading process in China.
Fifth: Work with a local buying office to control the business risk, offer legal consulting, supervise the whole business process and follow up the after-sale services etc when necessary.
There might be lot of other forms of L/C fraud in other countries, any comment is welcome.
STIN Verification Service Team is committed to reducing the business risks, fighting against business fraud and saving you more time, cost and energy etc in China. STIN main services are: Chinese Company Verification and Investigation, Factory Auditing, Professional Sourcing, Quality Control, Purchasing Agent Service etc. STIN service team is also offering a ONE-STOP procurement solution service for their clients worldwide in China: www.chinabizservices.com
or visit us online: http://youtu.be/IaoSngoycIo
Saturday, 7 February 2015
Sunday, 18 January 2015
China's weak foreign trade growth suggests more policy easing
BEIJING - China's foreign trade increased 3.4 percent year on year in 2014 denominated in US dollars, significantly lower than the 7.6 percent rise in 2013 and the 7.5 percent target, indicating more room for monetary easing.
Denominated in US dollars, exports rose 6.1 percent in 2014, while imports increased 0.4 percent, Zheng Yuesheng, spokesman for the General Administration of Customs (GAC) announced on Tuesday.
Denominated in Chinese yuan, exports increased 4.9 percent to 14.3 trillion yuan, while imports fell 0.6 percent to 12.04 trillion yuan. The foreign trade surplus widened to 2.35 trillion yuan in 2014, an increase of 45.9 percent.
The leading export index slid for the third month to 40.1 in December 2014, the lowest since December 2013, and a pessimistic prospect for exports in 2015.
Zheng Yuesheng attributed the weak foreign trade growth in 2014 to a slow global recovery, less competitive Chinese made products, less foreign direct investment (FDI) in the manufacturing sector and falling commodity prices.
The average price of China's iron ore imports dropped 23.4 percent in 2014, while crude oil and soy bean import slid 6.1 percent and 6.8 percent,respectively, Zheng said.
"With domestic demand still depressed, policy easing is still needed," said Bob Liu, an analyst at the China International Capital Corp (CICC), adding that the government may set a lower export growth target for 2015.
Liu Ligang, chief Greater China economist at ANZ Banking Group agreed. that weak domestic demand and investment led to weak growth.
Trade with the European Union, China's biggest trade partner, edged up 8.9 percent to 3.78 trillion yuan, while trade with the United States, the second-biggest partner, rose 5.4 percent to 3.41 trillion yuan. Trade with third-largest partner ASEAN, rose 7.1 percent to 2.95 trillion yuan.
Trade with Japan contracted 1 percent 1.92 trillion yuan.
For 2015, economists believe that the foreign trade growth will continue the downward trend.
Bob Liu predicted that both export and import growth will fall in January, but export growth should still be much stronger than imports. The trade surplus is expected to remain high in January, before experiencing a seasonal decline in February and March.
His point was echoed by a research note from Merrill Lynch, forecasting that the elevated trade surplus could be sustained for several months on falling crude oil prices, while export growth could soften on a strong RMB.
Related:
Subdued price levels point to more policy easing
China's consumer inflation remained weak in December while price declines at the factory gate level continued to deepen, suggesting weakness in the world's second-largest economy but will create space for policy makers to take easing measures.
Growth in the consumer price index (CPI), the main gauge of inflation, rebounded to 1.5 percent in December from November's 1.4 percent, its slowest increase since November 2009, the National Bureau of Statistics (NBS) said Friday.
On a monthly basis, December's CPI edged up 0.3 percent against the previous month, reversing the downward trend experienced since September.
This small pick-up in December's consumer inflation was mostly driven by food prices, said Chang Jian, Barclays chief China economist.
Food prices, which account for about one-third of the CPI calculation's weighting, rose 2.9 percent from a year ago in December, compared to 2.3 percent the previous month.
Growth in non-food prices, however, fell to a 56-month low of 0.8 percent, led by falling transportation and housing costs, Chang said.
China's consumer prices grew 2 percent in 2014 from one year earlier, well below the government's 3.5 percent target set for the year. It was also below the 2.6 percent growth registered in 2013.
Producer price index (PPI) slumped 3.3 percent in December from one year earlier, the sharpest fall in more than two years, and the decline deepened from November's 2.7 percent fall.
Tumbling oil and other commodity prices have extended the run of producer-price declines to a record 34 months.
PPI fell 1.9 percent year on year in 2014.
The easing inflationary pressure will give the central bank more room to initiate measures to support growth.
In November, the central bank cut benchmark interest rates for the first time since the summer of 2012. Analysts are divided over whether more rate cuts would follow in the coming months as the 2014's growth figures are likely to register its slowest pace in more than a decade.
Chang forecast two additional cuts in benchmark interest rates, by 25 basis points each time, in the first half of this year, as well as three cuts in the reserve requirement ratio (RRR), by 50 basis points each time, throughout the year.
Liu Liu, analyst of China International Capital Corp., expects the central bank to cut interest rates once and lower RRR four times this year likely in the first half.
However, Liu Ligang,chief Greater China economist at ANZ Banking Group., said the central bank appeared to be reluctant to cut RRR to counter falling prices and economic slowdown.
The Chinese government should use both structural reform measures and monetary policy tools to head off the risk of deflation, especially when domestic demand remains weak and commodity and energy prices continue to fall, Liu Ligang wrote in a report to clients.
Final figures for last year's gross domestic product (GDP) are slated for released on Jan 20.
Resources: China Daily
Denominated in US dollars, exports rose 6.1 percent in 2014, while imports increased 0.4 percent, Zheng Yuesheng, spokesman for the General Administration of Customs (GAC) announced on Tuesday.
Denominated in Chinese yuan, exports increased 4.9 percent to 14.3 trillion yuan, while imports fell 0.6 percent to 12.04 trillion yuan. The foreign trade surplus widened to 2.35 trillion yuan in 2014, an increase of 45.9 percent.
The leading export index slid for the third month to 40.1 in December 2014, the lowest since December 2013, and a pessimistic prospect for exports in 2015.
Zheng Yuesheng attributed the weak foreign trade growth in 2014 to a slow global recovery, less competitive Chinese made products, less foreign direct investment (FDI) in the manufacturing sector and falling commodity prices.
The average price of China's iron ore imports dropped 23.4 percent in 2014, while crude oil and soy bean import slid 6.1 percent and 6.8 percent,respectively, Zheng said.
"With domestic demand still depressed, policy easing is still needed," said Bob Liu, an analyst at the China International Capital Corp (CICC), adding that the government may set a lower export growth target for 2015.
Liu Ligang, chief Greater China economist at ANZ Banking Group agreed. that weak domestic demand and investment led to weak growth.
Trade with the European Union, China's biggest trade partner, edged up 8.9 percent to 3.78 trillion yuan, while trade with the United States, the second-biggest partner, rose 5.4 percent to 3.41 trillion yuan. Trade with third-largest partner ASEAN, rose 7.1 percent to 2.95 trillion yuan.
Trade with Japan contracted 1 percent 1.92 trillion yuan.
For 2015, economists believe that the foreign trade growth will continue the downward trend.
Bob Liu predicted that both export and import growth will fall in January, but export growth should still be much stronger than imports. The trade surplus is expected to remain high in January, before experiencing a seasonal decline in February and March.
His point was echoed by a research note from Merrill Lynch, forecasting that the elevated trade surplus could be sustained for several months on falling crude oil prices, while export growth could soften on a strong RMB.
Related:
Subdued price levels point to more policy easing
China's consumer inflation remained weak in December while price declines at the factory gate level continued to deepen, suggesting weakness in the world's second-largest economy but will create space for policy makers to take easing measures.
Growth in the consumer price index (CPI), the main gauge of inflation, rebounded to 1.5 percent in December from November's 1.4 percent, its slowest increase since November 2009, the National Bureau of Statistics (NBS) said Friday.
On a monthly basis, December's CPI edged up 0.3 percent against the previous month, reversing the downward trend experienced since September.
This small pick-up in December's consumer inflation was mostly driven by food prices, said Chang Jian, Barclays chief China economist.
Food prices, which account for about one-third of the CPI calculation's weighting, rose 2.9 percent from a year ago in December, compared to 2.3 percent the previous month.
Growth in non-food prices, however, fell to a 56-month low of 0.8 percent, led by falling transportation and housing costs, Chang said.
China's consumer prices grew 2 percent in 2014 from one year earlier, well below the government's 3.5 percent target set for the year. It was also below the 2.6 percent growth registered in 2013.
Producer price index (PPI) slumped 3.3 percent in December from one year earlier, the sharpest fall in more than two years, and the decline deepened from November's 2.7 percent fall.
Tumbling oil and other commodity prices have extended the run of producer-price declines to a record 34 months.
PPI fell 1.9 percent year on year in 2014.
The easing inflationary pressure will give the central bank more room to initiate measures to support growth.
In November, the central bank cut benchmark interest rates for the first time since the summer of 2012. Analysts are divided over whether more rate cuts would follow in the coming months as the 2014's growth figures are likely to register its slowest pace in more than a decade.
Chang forecast two additional cuts in benchmark interest rates, by 25 basis points each time, in the first half of this year, as well as three cuts in the reserve requirement ratio (RRR), by 50 basis points each time, throughout the year.
Liu Liu, analyst of China International Capital Corp., expects the central bank to cut interest rates once and lower RRR four times this year likely in the first half.
However, Liu Ligang,chief Greater China economist at ANZ Banking Group., said the central bank appeared to be reluctant to cut RRR to counter falling prices and economic slowdown.
The Chinese government should use both structural reform measures and monetary policy tools to head off the risk of deflation, especially when domestic demand remains weak and commodity and energy prices continue to fall, Liu Ligang wrote in a report to clients.
Final figures for last year's gross domestic product (GDP) are slated for released on Jan 20.
Resources: China Daily
Subscribe to:
Posts (Atom)