Policies are being developed to boost domestic consumption. According to a recent announcement from the Department of Tariff, the Ministry of Finance, China will cut import tariff rates of partial daily consumer goods in the form of a tentative tariff rate.


Experts said that the implementation of the policy was a good initiative. However, markets determine the level of consumption. National brands should identify their positioning, improve product quality, and shape brand images.


Tariffs will be reduced on a number of imported consumer goods, including clothes, shoes and boots, cosmetics, paper diapers etc. The tariffs of all the items involved will be cut by more than 50 percent on average.


Everything has its cause. Due to high import tariffs and a preference for foreign brands, Chinese people with increasing purchasing power are interested in buying goods overseas. According to partial statistics from Ministry of Commerce, the value of consumption abroad in 2014 exceeded one trillion yuan.


“The measure of reducing tariffs of consumer goods is a good beginning. However, the market needs a certain time to respond. On one hand, the number of tariffs to cut is limited; on the other hand, markets determine real consumption ability. It can’t be too high at the beginning.” Zhao Ping, deputy director of the consumption and economy research department, the Ministry of Commerce explained to the media.


She noted that national brands should take advantage of opportunities to improve their quality and brand image, which is actually the “catfish effect”. Imported products may not be so different from national products. However, the fashion value and influence of the brand images which imported products own are what the domestic enterprises should learn from.

(source: People's Daily Online, MAy 28, 2015)

 

Tariffs cut to boost consumption abroad

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