China raises the tax rebates!

China raises the tax rebates!
Nov 12, 2008 22:00
FRANKENSTEIN Points: Join Date: Nov 29, 2004 Status: offline	Affected by the financial crisis, China's economy growth is slowing down. Many factories have closed. In order to stimulate its exports, China decides to raise the tax rebates on more than 3700 kinds of goods. This policy will take effect on December 1st. According to some economists, this policy can stimulate China's exports but it might also intensify the relationship between China and its foreign counterparts. Due to the financial crisis, the unemployment rates in EU and US are growing. If China raises the tax rebates, those enterprises and corps in foreign countries may suffer a lot. Do U think it is a wise decision?

Nov 12, 2008 22:00

FRANKENSTEIN
Points:
Join Date: Nov 29, 2004
Status: offline

Affected by the financial crisis, China's economy growth is slowing down. Many factories have closed. In order to stimulate its exports, China decides to raise the tax rebates on more than 3700 kinds of goods. This policy will take effect on December 1st.

According to some economists, this policy can stimulate China's exports but it might also intensify the relationship between China and its foreign counterparts. Due to the financial crisis, the unemployment rates in EU and US are growing. If China raises the tax rebates, those enterprises and corps in foreign countries may suffer a lot.

Do U think it is a wise decision?

Nov 13, 2008 02:45

AL32
Points:
Join Date: Sep 11, 2007
Status: Offline

Hi,
I'm no big financial expert, but I believe that this policy is mainly to stimulate domestic economy and at the same time, try to save jobs in China.
The point is that the financial crysis will not last forever and for the mean time, foreign countries will reduce their importations no matter what.
So this could help China's economy to stay strong until foreign countries are ready to buy from China again. That will benifit everyone then..

Until then, the foreign countries have much bigger problems to tackle then higher prices Chinese goods because like China, their emphasis will go on saving their own jobs and markets.

So all this makes for a short of 'each for yourself' kind of situation and it's hard to say who will suffer the most from it. It's also kind of the easiest solution to take because there would never be a correct or fair regulation agreement between countries...just think how the NAFTA between USA and Canada is always subject to 'exceptions' and how the USA try to re-write it to their advantage.

Nov 13, 2008 17:01	#2
MARRIE Points: Join Date: Jan 7, 2008 Status: Offline	The fact that 4,000 billion stimulas plan until 2010 and tax rebate implys global recession just began and will go through 2009 until unknow point of time.

Nov 18, 2008 03:08	#3
ZENCHEN Points: Join Date: Jan 28, 2008 Status: Offline	As an I/E operator,I should say it's a good policy

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