Japan's Treatment Of China's GSP Will End In April, And Exports Of Chemical And Textile Products Will Be Affected.

Since April 1st this year, Japan has formally terminated its treatment of GSP in China.

The adjustment of this policy will have a significant impact on Zhejiang's export enterprises, especially chemical and textile enterprises.

Japan has given the GSP treatment to China since 1980. It is the GSP giving country that has the highest tariff preferences.

In December 2018, the Ministry of finance of Japan formally announced the re adjustment of the "preferential tariff" system, eliminating the 5 countries from China, Mexico, Brazil, Thailand and Malaysia from the list of tariff relief lists for developing countries, which means that China's export enterprises to Japan will be more impacted.

Take Zhejiang as an example, Japan is the third largest country in Zhejiang's exports, second only to the United States and Germany.

According to the data of Hangzhou customs, Zhejiang exported 83 billion 700 million yuan to Japan in 2018. In that year, 24569 customs GSP certificates were issued by Hangzhou customs, and the value of goods was 6 billion 100 million yuan, which could enjoy Japanese customs tariff relief of about 180 million yuan.

The main products of the visa are chemical industrial products, plastic products, aquatic products, iron and steel products, meat and fish products, textiles, electromechanical products and so on.

The average tariff rate before the GSP system is about 3%. After the abolition of GSP treatment, the average tariff rate of goods exported to Japan will float about 3 percentage points, and some products will even exceed 10 percentage points.

Affected by the abolition of Japan's GSP treatment, Zhejiang's chemical industry and textile industry bear the brunt.

According to the statistics of Hangzhou customs, in 2018, except for Hangzhou Ningbo area, 3785 copies of chemical industrial products were exported, 1 billion 867 million yuan worth of goods, 6078 copies of textile products, 808 million yuan, and two products accounted for 44% of the value of Zhejiang visa.

After the implementation of the new deal, only two types of export products will enjoy a 80 million yuan reduction in tariff in Japan.

For example, a chemical company in Zhejiang exported to resorcinol in Japan, next year will increase the tariff cost of nearly 3 million yuan.

At present, China's textile products, shoes, umbrellas, bags and so on account for about 60% of Japanese exports, which are also the dominant export products of Zhejiang.

After April 1st, Japan still reserved the GSP treatment to Vietnam, Indonesia and India. The price competitiveness of these countries increased, and Zhejiang's export products were facing fierce competition.

In addition, investment strategies of Japanese companies in China will also be affected.

Some Japanese enterprises set up production bases in China and sold them to Japan after the purchase of domestic raw materials. The increase in tariff costs will enable Japanese enterprises to reconsider the allocation of global production bases and cancel plans to expand investment in China.

In this regard, Hangzhou customs recommends that enterprises in the customs area should continuously optimize their product mix, enhance product quality and brand value, and gradually get rid of price advantage dependence. On the other hand, we should continue to make full use of preferential policies of origin to enhance the international competitiveness of products.

First, we should actively open up new overseas markets, especially to develop the markets along the "one belt and one way" market, and make full use of the tariff preferences granted to Chinese products by ASEAN, Australia, South Korea, Switzerland, Chile and other 15 FTA and 3 preferential trade arrangements already signed by China.

The two is to make full use of the GSP treatment in other countries, such as "ship to sea", such as enterprises that have established production lines in India, Indonesia, Vietnam and other countries favored by Japan's GSP, so as to encourage them to "ship to sea" and fully enjoy Japan's GSP tariff preferences.

Three, at present, China is actively promoting the negotiation of regional comprehensive economic partnership agreement (RECP) with Japan and other countries, and China, Japan and South Korea free trade area. Enterprises and trade associations should take the initiative to provide relevant departments with industry views, and strive for better opportunities and environment for export products.