Foreign trade transformation restarts processing trade catalog or recent adjustment

[China Glass Network] The adjustment of processing trade policy for more than one year of dust seals may be launched again in the near future.

Under pressure from energy conservation and emission reduction, the Ministry of Finance announced on June 23 that it will cancel six categories of steel (4107, 20.00, 0.49%), chemical products and non-ferrous metal processing materials from July 15th. Export tax rebates for “two high and one capital” (high pollution, high energy consumption, resource type) products.

Some foreign trade system officials revealed on June 23 that with the export tax rebate reduction policy, there is also an expansion of the prohibited catalogue of processing trade. The six major categories of products involved in the tax rebate adjustment will be included in the prohibited category of processing trade and will no longer be enjoyed. Import and export bonded concessions, and the timing of this policy is approaching.

At the end of May and the beginning of June, the Ministry of Commerce, the National Development and Reform Commission and other ministries and commissions had been assigned to Guangdong, Zhejiang and other major foreign trade export towns. According to the foreign trade system participants who participated in the survey, the temporary policy to protect the growth of the financial crisis and the long-term development of foreign trade Between the effectiveness policies, how to balance the trade-offs at the moment is a difficult problem for the research team.

The above-mentioned person said that although the fine-tuning of this round of foreign trade policy is aimed at alleviating the pressure of emission reduction, in the long run, the structural adjustment of foreign trade, especially the restart of the transformation of processing trade cannot be avoided.

According to the announcement of the Ministry of Finance, the full amount of export tax rebates will include some steel products; some non-ferrous metal processing materials; silver powder; alcohol, corn (1915, 6.00, 0.31%) starch; some pesticides, medicine, Chemical products; some plastics (9850, 255.00, 2.66%) and products, rubber (22425, 360.00, 1.63%) and products, glass and products, and other six categories of goods with a total of 406 tax numbers.

The export tax rebate for steel and some non-ferrous products will be cancelled for nearly a month. The above products have enjoyed an export tax rebate rate of 5%-17%.

The aforementioned foreign trade system said that whether it is the adjustment of the export tax rebate policy just introduced, or the expansion of the prohibition of the processing trade prohibition, the changes in this series of foreign trade policies are part of the national package of emission reduction measures.

In the first quarter of this year, on the basis of the low base last year, the energy consumption of the six high-energy-consuming industries such as electricity, steel, nonferrous metals, building materials, petrochemicals and chemicals rebounded sharply. According to preliminary calculations, national energy consumption increased by 3.2% year-on-year, and energy consumption per unit of output value in 12 regions increased from the downward trend, which aggravated the pressure on emission reduction work in the third quarter of this year.

Zhou Shizhen, the vice president of the former Minmetals Chamber of Commerce, said on June 22 that according to the requirement of 20% reduction in the energy consumption per unit of GDP in the “Eleventh Five-Year Plan”, this year’s GDP energy consumption will drop by more than 5% to ensure the completion of the target and the difficulty of reducing emissions will exceed "Eleventh Five-Year" any year in the past four years. "It is expected that in the next 5-10 years, energy conservation and emission reduction will be a major topic that restricts China's foreign trade and even China's economic development."

In May, the National Development and Reform Commission officially stated at an internal energy conservation and emission reduction meeting that the energy consumption per unit of GDP has slowed down or even rebounded since the third quarter of last year, mainly due to the excessive growth of high-energy and high-emission industries. Whether the goal of energy conservation and emission reduction in the "Eleventh Five-Year Plan" can be achieved this year depends on whether the excessive growth of the "two high" industries can be effectively controlled.

One of the control measures is to strictly control the export of this category.

There is also news that the expansion of the banned catalogue of the processing trade may affect commodities that have previously been included in the catalogue of processing trade restrictions. Some restricted commodities will be adjusted to prohibited categories and will no longer enjoy the bonded concessions for import and export.

Zhang Yansheng, director of the Institute of Foreign Economic Research of the National Development and Reform Commission, analyzed on June 22nd, canceled the export tax rebate for some products, and strictly controlled the export of “two highs and one capital”. The impact of the financial crisis has come to an end and the country will continue the crisis. The former "tune structure" and transform the development mode of foreign trade.

In 2007 and 2008 before the financial crisis, under the pressure of “reducing the surplus and adjusting the structure”, the decision-making layer lowered the export tax rebate rate of commodities several times, and continuously expanded the catalogue of prohibited categories of processing trade, and added a catalogue of processing trade restrictions, and affected categories. Most of them are "two high and one capital" products such as steel and non-ferrous metals, as well as labor-intensive products such as textiles and garments.

After the outbreak of the crisis, in order to ensure the growth of exports, the decision-making layer raised the export tax rebate rate for many types of commodities several times, and eliminated thousands of commodity codes in the catalogue of processing trade restrictions and the catalogue of prohibited categories, almost completely eliminating the pre-crisis Two-year foreign trade policy adjustment.

The tightening of the pilot processing trade policy in the six cities of Guangdong has always been considered to represent the general direction of the optimization of foreign trade structure. The re-launch of this policy adjustment has had a profound impact on Guangdong, which accounts for about 40% of the country's processing trade.

Guangdong foreign trade system person introduced on June 21, according to the ideas conveyed by the central research team before the financial crisis, the adjustment of processing trade policy is far from over, and the more stringent measures have to be temporarily put on hold due to the financial crisis.

He revealed that in the past two years, Guangdong has been striving for an independent adjustment period of 5-10 years of processing trade policy, striving to become a pilot province for the transformation and upgrading of processing trade. Although the issue of autonomy on policy adjustment is not easy to fulfill, the Outline of the Plan for Reform and Development of the Pearl River Delta clearly defines Guangdong as a demonstration zone for the transformation and upgrading of processing trade across the country.

In fact, although the adjustment of the processing trade policy has temporarily stagnated in the past two years, Guangdong has been making voluntary adjustments.

After the Guangdong Provincial Government issued the No. 69 document “Some Opinions on Promoting the Transformation and Upgrading of Processing Trade”, at the end of 2009, Guangdong Provincial Governor Huang Huahua further clarified the timetable for the transformation and upgrading of processing trade in the province's processing trade transformation and upgrading site meeting. - In 2012, the processing enterprises that did not have legal person qualifications in the province were basically transformed into foreign-funded enterprises or other types of enterprises with independent legal person qualifications; by 2020, they will take the lead in basically realizing the transformation and upgrading of processing trade, and the processing trade enterprises will basically realize the Brand production and commissioned design have been transformed into independent brands. ODM (original designer) and OBM (own brand manufacturer) accounted for more than 70%, and processing trade sales doubled compared with 2008.

The above-mentioned Guangdong officials said that Huang’s speech and earlier documents basically set up the basic ideas for the transformation of Guangdong’s processing trade. Guangdong has recently finalized Guangzhou, Shenzhen, Dongguan, Foshan, Huizhou and Zhongshan as pilot cities for processing trade transformation. These six cities are all developing specific transformation plans. The initial assessment of the pilot enterprises is a step forward in the transformation."

Taking Dongguan as an example, the three “1000” transformations in Dongguan have been reported to the Ministry of Commerce as one of the processing trade transformation experiences in Guangdong. The three “1000”, which promoted 1,000 processing enterprises, changed from “unincorporated enterprises” to “legal enterprises”, promoted 1,000 processing trade enterprises to expand the domestic market, and promoted 1,000 processing trade enterprises to improve production levels.

Sun Haifeng, chief representative of the Guangzhou Office of the Hong Kong Productivity Council, which cooperated with the Dongguan Municipal Government to promote this project, introduced on June 22, and since July last year, the agency has launched an evaluation project to help 600 of Hong Kong-owned enterprises in Dongguan improve production levels. The Dongguan municipal government has invested more than tens of millions in this project alone.

A team of more than 300 experts will conduct basic diagnosis of 300 companies, conduct in-depth diagnosis of 200 companies, and arrange counseling programs for 100 companies. Diagnostics are designed to help companies more rationally arrange production lines, as well as product development and process technology. Sun Haifeng said that the productivity of enterprises that have adopted the evaluation recommendations has generally increased by 20% or even 50%.

The experience of Dongguan has been widely used by other pilot cities. Foshan, Zhongshan, Zhuhai, Guangzhou and other cities are planning to allocate funds to help enterprises complete the transformation diagnosis.

Restart "tune structure"

In fact, the transformation and upgrading measures of various processing trades in Guangdong are more directed to the middle group of foundry enterprises in the Pearl River Delta.

The aforementioned Guangdong officials said that the top of the foundry enterprise is the production of large multinational companies in Europe and the United States in the Pearl River Delta. This part of the enterprise relies on China's cheap labor resources. "This kind of enterprise cannot guide the transformation. Our idea is to classify Guide and strive for them to gradually put R&D and other aspects into the country."

He said that Guangdong's series of measures to promote the transformation of the main body is actually Hong Kong and Macao Taiwan-funded enterprises and private capital processing trade enterprises, such enterprises can complete the transition from low-end to low-end products to the key.

Zhang Yansheng, director of the Institute of Foreign Economic Research of the National Development and Reform Commission, said that a survey of Hong Kong and Macao Taiwan-funded OEMs in the Pearl River Delta found that 20% of enterprises can successfully complete the transformation, and 20% of enterprises will be eliminated in the process of transformation. The problem lies in the remaining How do these 60% of enterprises change? He reminded that Guangdong's current policy ideas to promote the transfer of processing trade enterprises to the east and west wings and the mountainous areas of northern Guangdong are more of a government choice than a corporate choice.

He said that after years of excessive consumption of labor, how to change the international division of labor formed by multinational corporations in the first 30 years to form a trading system that can take root in China is the core issue facing the transformation of processing trade.

Mei Xinyu, a researcher at the Ministry of Commerce, reminded that the goal of the transformation of processing trade is to increase China’s share of revenue in the international division of labor, rather than handing over the existing share to rivals.

He analyzed that the transformation of processing trade is divided into three levels, one is the improvement of product and industry level; the other is the improvement of processing trade mode, which is to change from the processing of less income in the international division of labor to the higher income. Material processing; the main body of processing trade should shift from the current foreign-oriented to domestic-funded enterprises.

How should the processing trade be transformed and upgraded? The specific guiding ideas are likely to be clear around mid-July.

According to the aforementioned foreign trade system, the Ministry of Commerce has been organizing research on the major issue of China's foreign trade development strategy in the post-crisis era. It is expected that the State Council will issue a guidance on accelerating the transformation of foreign trade development mode in the middle and late July. The supporting policies and measures will also be introduced one after another.

Li Gang, a researcher at the Research Institute of the Ministry of Commerce, who was one of the drafters of this project report, mentioned in the Spring Canton Fair that one of the directions of foreign trade strategy is to strengthen general trade, enhance processing trade, and develop other trade methods.

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