What’s new: China's State Council pledged to stabilize and expand international trade with measures such as financial support and facilitating cross-border travel for businesspeople to strengthen the economic recovery.
The cabinet issued a set of measures Tuesday designed to support foreign trade and expand the export market amid weak global demand. The measures include promoting major trade fairs, streamlining visa procedures for foreign businesspeople, speeding up international flight resumption and providing better services to trading companies, according to a statement (link in Chinese).
Supportive measures will be provided to boost vital export sectors such as automobiles and machinery. China will also use financial support to encourage companies to import more advanced equipment.
Financial institutions will increase credit support to exporters and are encouraged to expand the scale of yuan settlement in cross-border transactions, according to the statement.
The context: Foreign trade is an important component of the national economy. Promoting stable scale and optimized structure of foreign trade plays an important role in stabilizing growth and employment, building a new development pattern and promoting high-quality development, the cabinet said.
Chinese authorities have repeatedly emphasized the importance of trade as the world’s second-largest economy struggles to recover from three years of pandemic disruptions.
Over the past three years, booming export demand was a strong support for China’s economy and helped compensate for weak domestic spending caused by the housing market slump and “zero-Covid” restrictions. Exports began to contract in late 2022 as demand from the U.S., the European Union and other countries lost momentum.
China’s exports jumped 14.8% in U.S. dollar terms last month, the first gain in six months. The unexpected rise was partly driven by an uptick in shipments to Southeast Asia nations and resilient demand from South Korea and Europe, analysts said.
Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bob.simison@caixin.com)
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