Event:
Premier Li Keqiang chaired an executive meeting of the State Council on April 13 to deploy policies and measures to promote consumption, help stabilize the economic fundamentals and ensure the improvement of people’s livelihood; Decided to further strengthen policy support such as export tax rebate to promote the steady development of foreign trade; Determine measures to increase financial support for the real economy and guide market players to reduce financing costs.
Key data points:
Make concerted efforts, give consideration to both far and near, stabilize current consumption and release consumption potential.
Since March, the rebound of covid-19 epidemic in the mainland has had a great impact on consumption. At present, there is still great uncertainty about the epidemic in China, and the downward pressure on the economy is obvious. Consumption has a lasting driving force for the economy and is related to ensuring and improving people’s livelihood. The NPC pointed out that we should deal with the impact of the epidemic and promote the recovery and development of consumption. We will pay close attention to the implementation of the relief policies for special hardship industries that have been issued, and stabilize more players in the consumer service market. Ensure the supply and price of basic consumer goods and ensure smooth logistics. At the same time, accelerate the integration of Wuxi Online Offline Communication Information Technology Co.Ltd(300959) consumption and expand consumption in key areas. We will promote the consumption of medical and health care, elderly care and childcare, and support social forces to make up for the short supply of services. Encourage mass consumption of automobiles and household appliances; Support the consumption of new energy vehicles. Guide commercial circulation enterprises and e-commerce platforms to extend to rural areas, and promote brand quality consumption into rural areas.
Give better play to the export tax rebate policy and optimize the foreign trade business environment.
According to the import and export data released by the General Administration of Customs on April 13, the total import and export value of China’s goods trade in the first quarter of this year was 9.42 trillion yuan, an increase of 10.7% year-on-year, achieving a “stable start” and laying a good foundation for achieving the annual goal. However, at the same time, due to the impact of geopolitical conflicts, the external environment of foreign trade is becoming more severe and complex, and the negative impact of the upgrading of epidemic control in many parts of the country on the supply chain and foreign trade, the development of foreign trade still faces many risks and challenges.
The NPC pointed out that in order to promote the steady development of foreign trade, we should give better play to the policy effectiveness of export tax rebate, which is inclusive, fair and in line with international rules, and optimize the foreign trade business environment. First, processing trade enterprises are allowed to transfer in the input tax to offset the value-added tax on the amount of tax that should be refunded after implementing the policy of the same tax rate for export products. Export credit insurance compensation shall be regarded as foreign exchange collection and refunded. Second, speed up the progress of tax rebate, implement the whole process online, and reduce the tax rebate processing time from an average of 7 working days to 6 working days. Third, improve the efficiency of customs clearance for the return of export goods, formulate policies to facilitate the return and exchange of cross-border e-commerce, provide more convenience for customs clearance and tax refund of trustworthy enterprises, and severely punish acts such as defrauding tax rebates.
To reduce the financing cost of market players, the national standing committee decided to reduce the reserve requirement in due time.
The total amount of new loans and the structure of new loans for enterprises are still weaker than expected in March, but the RMB financing structure remains to be improved. At present, China’s economy is facing great downward pressure due to repeated epidemics and the decline of the real estate industry. It is urgent to enhance market confidence and expand total demand. At present, in order to ensure the stable operation of the economy, the national standing committee released a clear signal last week and this week that macro policies should be strengthened in advance and in due course.
On April 6, the executive meeting of the State Council pointed out that we should make timely and flexible use of various monetary policy tools such as refinancing, give better play to the dual functions of aggregate and structure, and increase support for the real economy. On April 13, the national standing committee decided to encourage large banks with high provision level to reduce the provision rate in an orderly manner in view of the changes in the current situation, timely use monetary policy tools such as RRR reduction, further strengthen financial support for the real economy, especially industries seriously affected by the epidemic, small, medium-sized and micro enterprises and individual industrial and commercial households, reasonably transfer profits to the real economy and reduce comprehensive financing costs.
Based on the experience in recent years, after the national Standing Committee puts forward the requirement to reduce the deposit reserve ratio, the central bank usually responds and implements it within one week. Therefore, the RRR reduction policy is also expected to be implemented in the near future.
Risk tips:
1. Geopolitical crisis continues to ferment;
2. The spread of the epidemic in China has intensified;
3. Loose policy efforts and increased expectations.
