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News from China

China eases companies' burden with tax and fee cuts, deferrals

1st July 2022

China's tax refunds, as well as tax and fee cuts and deferrals reached 2.58 trillion yuan (about 384 billion U.S. dollars) from the beginning of this year to June 25, as the country unveiled a slew of supportive policies to ease enterprises' burden, official data showed Thursday.

Among the total, value-added tax credit refunds hit 1.83 trillion yuan, 2.8 times the annual amount of last year, while preferential tax and fee reduction policies helped companies save 285.9 billion yuan, Cai Zili, an official with the State Taxation Administration told a press conference.

The deferred payment of tax and fees during the period came in at 463.2 billion yuan, effectively helping enterprises increase their cash flows, Cai said.

Priorities have been given to small businesses as nearly 70 percent of the tax and fee support went to micro, small and medium-sized enterprises.

Last year, China's tax and fee reductions totaled more than 1 trillion yuan, according to this year's government work report.

Data from the administration also showed that China's economic recovery accelerated with the implementation of a package of pro-growth measures.

In May, sales revenue of Chinese enterprises logged a year-on-year increase of 1.9 percent. From June 1 to 25, the growth of enterprises' sales revenue was 6.8 percent, Cai said.

Source: Xinhua

China's foreign trade sees positive changes in Q2: trade council

30th June 2022

China's foreign trade saw positive changes in the second quarter as the government's pro-growth policies gradually pay off, according to a survey conducted by the China Council for the Promotion of International Trade (CCPIT).

In the second quarter, firms in the foreign trade sector reported improvements in new orders and operation costs, CCPIT spokesperson Feng Yaoxiang told a press conference on Wednesday.

During the period, 25.43 percent of surveyed firms saw quarter-on-quarter growth in trade volume, and 19.98 percent and 22.65 percent respectively reported expansions in profits and new orders.

Relief policies to stabilize foreign trade have proven effective, the survey results showed. For 55.97 percent of surveyed enterprises, the acceleration of export tax rebates played the biggest role in easing cash strains.

The survey results showed that companies in the foreign trade industry remain optimistic about their development prospects, with 26.22 percent expecting annual trade volume growth.

With a solid foundation, China's foreign trade will unleash its potential further, Feng said, and more supportive measures will be rolled out to stabilize foreign trade and promote high-quality development.

Source: Xinhua

China to cut gasoline, diesel retail prices

29th June 2022

China will cut the retail prices of gasoline and diesel starting Wednesday, the country's top economic planner said Tuesday.

The prices of gasoline and diesel will go down by 320 yuan (about 47.81 U.S. dollars) per tonne and 310 yuan per tonne, respectively, according to the National Development and Reform Commission.

The move marks the 2nd fuel-price decrease since the beginning of this year.

Under the current pricing mechanism, if international crude oil prices change by more than 50 yuan per tonne and remain at that level for 10 working days, the prices of refined oil products such as gasoline and diesel in China will be adjusted accordingly.

China's three biggest oil companies, namely China National Petroleum Corporation, China Petrochemical Corporation and China National Offshore Oil Corporation, have been directed to maintain oil production and facilitate transportation to ensure stable supplies.

Source: Xinhua

China's industrial profits improve on rebounding factory activities

28th June 2022

Profits of China's major industrial companies saw a narrower decline in May as factories in the world's second-largest economy restarted production lines as business sentiments improved, official data showed Monday.

Major industrial firms, each with business revenue of at least 20 million yuan (about 2.99 million U.S. dollars), saw their profits decline 6.5 percent year on year in May, narrowing from the 8.5-percent contraction in April, data from the National Bureau of Statistics (NBS) showed.

Revenues of these major firms went up 6.8 percent from a year ago last month, a faster growth pace compared with April, the data showed.

China's industrial economy is stabilizing and picking up, said Xin Guobin, vice minister of industry and information technology.

Commenting on the reading in May, senior NBS statistician Zhu Hong attributed the slower contraction to effective epidemic control, recovering business activities and progress achieved in smoothing logistics.

During the first five months, major industrial firms made about 3.44 trillion yuan in total profits, rising 1 percent from a year ago, NBS data showed.

Of all 41 industrial sectors, 20 registered yearly profit growth or narrowed year-on-year profit contraction in May, while five managed to reverse the declining trend to post-profit expansion.

Last month, the country's northeastern region and the Yangtze River Delta, where the metropolis Shanghai is situated, reported a much smaller decline in industrial profits compared with April, as these areas gradually shook off the COVID-19 fallouts.

Boosted by policy support and relatively high prices, the energy sector saw profits surge in May. Profits of coal, oil and natural gas exploitation industries more than doubled, contributing to 9.5 percent of overall industrial profit growth last month.

Marginal profits of the equipment manufacturing sector reported a marked improvement compared with April, and better earnings were also reported among producers of consumer goods last month, Zhu said.

Despite these positive changes, Zhu cautioned that given the relatively weak recovery foundation and the changing international landscape, there are still many uncertainties for industrial enterprises to earn profits.

Official data showed that China's key economic indicators saw improvements in May. Its value-added industrial output, for instance, reversed the decline in April and posted a year-on-year expansion last month.

To shore up the virus-hit economy, the State Council has unveiled a package of 33 measures in six aspects recently to further stabilize the economy.

The industry ministry has pledged to focus on stabilizing industrial chains and step up support for small and medium-sized enterprises, in order to ensure the delivery of the policy package.

Building on the momentum in May, it is highly likely that China's industrial firms will report better profits in June, said Zheng Houcheng, director of Yingda Securities Research Institute.

Source: Xinhua

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