By He Shan
China.org.cn staff reporter

Liao Xiaoqi, a former minister at the Ministry of Commerce, proposed at the CPPCC that the government cut export duties to zero in order to boost China's troubled export sector.

Wei Jianguo, the former Minister of Commerce speaks to reporters, March 7, 2009. [China.org.cn]

Worried by slow growth and widespread factory closures, since 2008 China has stepped up aid for manufacturers by raising rebates on export taxes paid on a variety of goods .

"The rebate increases announced last year have begun to take effect," said Liao. "But additional measures should be taken to counter the fall in overseas demand. Many export-driven enterprises are in serious difficulties because overseas consumers have stopped spending."

He said the government should reduce export duties to zero, saying that zero duty is a neutral policy and complies with the rules of the WTO.

According to Liao, many countries have adopted a policy of full tax rebates for exporters, effectively bringing duties down to zero.

Another former official of the Ministry of Commerce echoed Liao's suggestion, saying that he hoped duty-free exports would become the norm.

Wei Jianguo, also a former minister in the Ministry of Commerce revealed that the ministry is drawing up a revised export policy based on a study carried out in Shanghai and Shenzhen.

In January, China's exports fell 17.5 percent from a year earlier, worse than most economists and analysts had projected.

(China.org.cn March 8, 2009)