Experts Recommend Full Tax Rebate To Ensure Steady Export Employment

Recently, the State Council held a executive meeting to study seven major policy measures to ease export enterprises' difficulties and maintain steady growth in foreign trade.

Experts interviewed by China economic times believe that this is a set of obvious substantive good policies, which will stimulate export expansion very directly and in a timely manner. At present, it is difficult to boost domestic demand in the short term.

It is expected that the first half of next year will be the most difficult. According to the latest statistics, the total amount of foreign trade and import and export in China in the first 11 months of 2008 will be $2 trillion and 378 billion 370 million, an increase of 20.9%.

Of which, exports of US $1 trillion and 317 billion 160 million, an increase of 19.3%, and imports of US $1 trillion and 61 billion 210 million, an increase of 22.8%.

The surplus of foreign trade totaled 255 billion 950 million US dollars, an increase of 6.8%.

Although the US dollar denominated export growth rate is still 19.3%.

However, under the conditions of the depreciation of the US dollar and the depreciation of the renminbi, the growth rate of US dollar denominated exports has seriously exaggerated the real growth rate of exports.

Eliminating the impact of the depreciation of the US dollar, the real export growth rate of RMB denominated is only 9%. If the RMB depreciation factor is deducted (deducted from PPI), the actual export growth rate is only 1.4%.

This is the lowest export growth rate in China in the past ten years.

"The mainstream judgment is that the growth of major economies such as the US, Europe, Japan and other major economies in the three and fourth quarter of 2009 will be bottomed out and show a" U "trend, which means that China's exports will face more severe external demand constraints.

This is a general consensus of experts learned by reporters in a recent interview.

Vice president of Peking University, Hai Wen, vice president of Peking University and HSBC School of Commerce, said in an interview with our reporter at the "China economic opportunity and challenge forum and the first annual meeting of the HSBC Financial Research Institute of Peking University under the global financial crisis", that this year, when the financial crisis has not yet fully spread, the focus of China's macroeconomic regulation and control is mainly on overheating the economy and preventing comprehensive inflation. A series of austerity measures including control of credit, raising the deposit reserve ratio and lowering the export tax rebate rate are implemented. In addition, the large appreciation of RMB and strict employment laws and policies have led to the substantial increase in the operation cost of foreign trade enterprises, the weakening of traditional price advantage, the weakening of competitiveness and the disruption of exports.

On the other hand, when the domestic tightening policy is starting to work and has a substantial impact on the production of the enterprises, it has hit the rapid spread of the global financial crisis, affecting the real economy, the world economy is declining, and the external demand has been dropping sharply. As a result, the pressure and orders of the enterprises have been reduced and saved, and the export situation is worsening.

According to Mr Hai, the impact of the global financial crisis on China's exports is far more than that of the Asian financial crisis.

After the outbreak of the Asian financial crisis, China's foreign trade exports increased to zero in 1998, and the spread of the world financial crisis has led to the rapid decline of orders in China's enterprises since October 2008.

Nevertheless, the extent of the impact of foreign trade exports has not been fully revealed for the whole year. Generally, there are six months' lag. It is estimated that the export growth in the first half of 2009 will be negative. It may turn around in the second half of the year, but it will depend on the economic stimulus policies adopted by the European and American countries and how the external demand will rebound.

Recently, our government has adopted a series of policies and measures to promote foreign trade.

Among them, the finance and taxation departments have increased the export rebate rate of textile, clothing, light industry and some mechanical and electrical products three times.

Most of the 3770 commodities that have been raised in December 1st have been raised to more than 10% of tax rebates, especially for some mechanical and electrical products. The tax rebate rate has reached 14%.

It is understood that China's export tax rebate rate is the highest value of 17%, equivalent to zero tax export.

In this regard, Hai believes that the adjustment of the export tax rebate policy will play a certain role in lightening the burden of enterprises, but it has little effect on increasing exports. Because the export decline is no longer the lack of competitiveness caused by the price problem, but the problem of export obstruction due to the reduction of external demand, and the reduction of demand is not effective by price means.

"Exports are going down, and the first thing for the country to consider is employment. After all, exports are not just an industry. There are too many joint and several sides."

Li Jiguang, a Chinese WTO Research Institute of the University of foreign trade and economics, interviewed by China economic times, said that as for the specific adjustment of export tax rebate or other means, there are not many tools to be used in the WTO rules.

He believes that in view of the more severe export situation next year, we should further improve the export tax rebate policy and make full refund as far as possible.

The state can also adopt more flexible, targeted and targeted policies and measures, such as subsidies for R & D and other links. Even if some measures may violate the WTO rules, we will win time if there is at least a few years of trade disputes.

In response to the seven measures of promoting the export of the Executive Council of the State Council, Jiang Zezhong, a professor at the Capital University of foreign trade and economics, told the China Economic Times reporter that, in particular, second measures were proposed to adjust the prohibited categories and restricted catalogues of processing trade, which would be in line with the national industrial policy, excluding products with high energy consumption, high pollution and products with high technical content from the banned catalogue.

"This is an appropriate relaxation and delaying of the original policy, a significant change in attitude and substantial significance, indicating that our policies are still very flexible."

Jiang Zezhong believes that the RMB settlement test for trade in goods between Guangdong and the Yangtze River Delta region, Hong Kong and Macao, Guangxi and Yunnan and ASEAN will also greatly encourage trade circulation. The examination and approval procedures for the use of foreign currency settlement are cumbersome and long lasting. This time just using the opportunity to deal with the financial crisis to carry out this financial reform will greatly facilitate and promote the development of border trade.

Finally, measures are also proposed to actively resolve international trade frictions and support enterprises to develop new markets.

Jiang Zezhong said: "this shows that our government's attitude is very wise.

In the global economic crisis, the protectionism of all countries is rising again. Instead of taking a hard hitting approach, we take a positive attitude to solve the crisis together and develop towards the reduction of non-tariff barriers.

China's unemployment rate may rise to 11% in the first half of 2009. China's employment situation is already very grim.

Analysts pointed out that since the second half of 2008, weak domestic and foreign demand led to the freeze of new investment in enterprises, resulting in a sharp rise in unemployment, and the unemployment rate is expected to rise to 11% in the first half of 2009.

The Chinese Academy of social sciences has released a report that the unemployment rate in China's cities has climbed to 9.4%. In 2009, the proportion of 6 million 100 thousand graduates who had difficulty in employment may account for 1/4.

Chen Quansheng, a counselor of the State Council, pointed out that the number of unemployed people in China is far higher than the official statistics.

Under the pressure of the global financial crisis, in 2008, 67 small businesses in China were forced to close, and about 6 million 700 thousand jobs were evaporated, so that the number of unemployed people was far higher than 8 million 300 thousand of official statistics.

Dong Xianan, senior macroeconomic analyst at Southwest Securities, said that since the second half of 2008, the weakening of exports has led to the freeze of new investment in manufacturing industry, and the number of domestic unemployment has soared.

Due to the sharp shrinkage of new orders, the plates of electronic communications equipment, instruments, furniture, textiles and garments were seriously injured, profits fell, new investment was frozen, and workers were disbanded.

In the first half of 2008, in the first half of the year, 760 million of the total employed population was 387 million of the total employed population in agriculture, forestry, animal husbandry and fisheries, 99 million of the manufacturing industry, 59 million of trade and catering, 464 million of the construction industry.

Unemployment increased by 32 million 690 thousand in the second half of the year.

Among them, the most serious unemployment hit sectors in the 4 quarter were manufacturing and construction, with 19 million 800 thousand unemployed and 15 million 460 thousand unemployed.

The above unemployed population is 1/5 and 1/3 of the corresponding employment stock respectively, most of them are migrant workers.

Assuming that 7 million migrant workers return to agriculture, the total unemployment rate will rise to 11%, higher than the 9.4% estimate of the Academy of social sciences.

According to Okun's law, there is a reverse relationship between economic growth rate and unemployment rate.

The greater the total output of society, the greater the demand for labor input.

China experienced a -2.3% output gap in 1998, especially in the 2 quarter of 1998, with a single quarter output gap of -2.6% and corresponding unemployment rates of 9.9% and 10.2% respectively.

Dong Xian an estimated that the annual output gap in 2008 was -0.8%, and the single quarter output gap in the 4 quarter reached -3.8%, significantly breaking the single quarter output gap in 1998, corresponding to the unemployment rate of 8.5% and 11% respectively.

In 2009, the population of the 20-24 age group will increase by 5.6%, which is slightly higher than the growth rate in 2008.

Meanwhile, the average age of the employed population continues to move upward.

It is estimated that the output gap and unemployment rate in the first half of 2009 will be close to the 4 quarter of 2008, -3.8% and 11% respectively.

According to the law of economic cycle, the decline in demand leads to a decline in sales and an increase in stock.

After about 2-3 quarters, inventories rose to a certain level, and businesses began to panic to reduce inventories, and prices of products fell rapidly and production declined.

After about 4 quarters, profits showed negative growth and the worst case occurred.

After about 6 quarters, inventory returned to a suitable level, prices stabilized, output gradually recovered, and corporate profits gradually stabilized.

At present, the manufacturing industry and the real estate industry are mostly between the third and the fourth quarter. The employment situation is expected to improve in the second half of 2009.

Yang Jing: editor in charge