The export tax rebate for 406 categories of exports including steel, medicine, chemical products and nonferrous materials were recently scrapped. Tax rebates had been re-introduced to counter the global financial crisis. The adjustment means the nation is gradually trying to curb exports in order to cut down its excessive trade surplus. Exports of China witnessed a robust 48.5 percent year-on-year growth in May. It also indicated that the government is confident about domestic economy. Textile industry, which is the No.1 export-oriented industry in China, the export tax rebate will however remain unchanged, according to Mr. Wangwei, Deputy Director of Department of Consumer Goods Industry, China´s Ministry of Industry and Information Technology.

Mr. Wangwei introduced that textile and apparel industry is a labor-intensive industry and directly concerns with the social stability, therefore requires appropriate industry policies to guarantee its international competency. The tax rebate scrapping policy mainly targeted at high-polluting and high-energy-consuming products, which is another "iron hand" measure by the government to save energy and further reduces emissions.

Nevertheless, energy-saving and emission-reduction remains as an arduous mission for China in the year 2010. In addition with other possible uncertainties, it is possible that some unfavorable policies be rolled out in the second half year.

Source: China Textile Leader