Wen vows to stabilize foreign trade
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Xinhua, October 16, 2011
Premier Wen Jiabao has pledged more support measures for exporters including "a basically stable exchange rate" for Renminbi to stabilize foreign trade in the world's second largest economy amidst new external uncertainties.
Wen made the remarks during an Oct. 13-14 inspection tour of Guangzhou, the host city of the ongoing 110th China Import and Export Fair, also known as the Canton Fair, in the southern province of Guangdong.
During his inspection, Wen made field trips to Guoguang Electric Company Ltd. and Guangzhou Dayang Motorcycle Co., Ltd., which are both major exporting companies in the province.
At a meeting with some local foreign trade enterprises, Wen was briefed by their representatives about their business performance and the latest situation concerning China's imports and exports.
According to reports by the foreign trade sector, rising labor and material costs and the appreciation of Renminbi, or yuan, in recent years had greatly reduced the exporting companies' profitability and created trouble for their business.
"Even though we encounter difficulty now, we should remain confident and not be overwhelmed by the hardship," Wen said after hearing the business report.
Wen noted the government will take a package of measures and work with the foreign trade sector to plow through the difficulty and foster further growth of the economy.
China's trade surplus fell for the second straight month in September, dropping by 12.4 percent year-on-year to reach 14.51 billion U.S. dollars due to sluggish global demand and rising costs in domestic markets, the General Administration of Customs (GAC) said Thursday.
September exports rose 17.1 percent year-on-year to reach 169.67 billion U.S. dollars. Imports surged 20.9 percent to 155.16 billion U.S. dollars, according to the GAC data.
"The export growth was slower than expected. It will decline to 10 to 15 percent in the future as demand continues to weaken," said Chang Jian, an economist at Barclays Capital.
According to the premier, governments should remain clear-headed and pay close attention to the impact of domestic policies and external risks on China's exports and imports.
Currently and for the future, China should work to maintain the steady growth of exports despite changes in external environment.
"Though we need to sustain our economic growth by increasing domestic demand, we should not easily give up our shares in the international market," Wen said, adding that equal attention should be given to exports and imports.
In order to promote the equilibrium of the country's international current account, China should increase imports and boost offshore investment rather than reduce exports or limit foreign investment in the country, Wen noted.
To stabilize exports, China will continue the policy of tax rebate for exports, give more credit support to enterprises engaged in foreign trade and keep the exchange rate of the Renminbi "basically stable", he said.
China encourages foreign capital to invest in areas of advanced manufacturing, high-tech products, modern service, new energy and energy-efficient and environmental protection industries, he added.
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