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Business / Industries

'Strong tail wind' to aid export push

By Li Xiaokun (China Daily) Updated: 2015-05-07 05:30

State Council pledges support for sales of trains, electricity plants and other heavy equipment

Renewed efforts are to be made to help Chinese-made railways, electricity plants and other large-scale infrastructure equipment to go global and increase international cooperation over production capacity, the State Council said on Wednesday.

The government will "give a strong tail wind to send equipment and production capacity overseas", said a statement issued after the weekly executive meeting presided over by Premier Li Keqiang.

The move was described as "pushing for upgrading of development by expanding opening-up".

The meeting decided to focus on fields where China has an advantage, including the railway, electricity and telecom sectors, building materials and construction machinery. The initiative is intended to meet the needs of a number of regions, especially the nations along the Silk Road Economic Belt and the 21st Century Maritime Silk Road. Companies were urged to use cooperation over investment, construction and technology to drive exports and build up the image of Chinese equipment.

Officials at the meeting said related services such as upgrades and maintenance should be supplied to overseas customers along with equipment. The government will explore ways to use foreign exchange reserves, improve export credit insurance and build up a trans-border renminbi payment system to facilitate equipment exports.

Enterprises and financing institutions were encouraged to issue stocks and bonds to raise money at home and abroad.

The statement said the officials agreed that promoting exports and cooperation over production capacity will help Chinese companies to grow stronger and achieve a target of "quality imports and quality exports".

Li has promoted Chinese equipment and cooperation over production capacity since taking office in 2013, and a series of major deals involving sectors such as high-speed trains have been signed.

The premier first used the term "quality imports and quality exports" on April 3.

Chen Fengying, director of the World Economy Institute at the China Institutes of Contemporary International Relations, said the policies reflect a strategic change in the country's approach to foreign trade.

"We have entered another phase. The international market can no longer provide enough orders for our low-end products, while domestic labor cost keeps rising," Chen said.

According to Customs figures, China's exports fell by 6 percent in the first quarter.

However, exports of some high-end products rose significantly. Transportation and mobile phone exports surged by more than 20 percent.

Ding Jianchen, a professor at the School of Banking and Finance at the University of International Business and Economics, said the new international focus will help to alleviate downward pressure on the economy and generate increased revenues.

The executive meeting also decided to further streamline administration and delegate power to lower levels, and it approved plans for a pilot program that will give tax benefits to people buying commercial health insurance.

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