More and more Jiangsu-based enterprises have enjoyed the benefits from China’s signing of free trade agreements with other countries in recent years that has brought about substantial tariff elimination or reduction.
Free trade agreement is of vital importance for promoting global economic integration and eliminating trade barriers. Since the signing of the China-ASEAN Free Trade Agreement in 2002, China has signed 15 free trade agreements over the past decade with 23 countries and regions.
FTA partner countries can enjoy preferential policies such as tariff elimination or reduction and market opening.
In the workshops of Nanjing Deshuo Industrial Company, production on the electric garden tools to be exported to Australia is full swing.
The company used to pay the full cost of the goods to be exported in order to promote their own brands, thereby experiencing great pressures from the tariffs, the head of the company said.
The China-Australia FTA has enabled the company to enjoy direct tariff reduction by obtaining a certificate of origin from the local authorities.
Jiangsu-based enterprises have also enjoyed great benefits from FTA with the elimination or reduction of tariffs on the import of raw materials.
Jiangsu SUMEC Textile and Light Industry Co., Ltd has tapped into the FTA for the strategic choice in its use of global resources and expansion of the overseas markets.
The company has set up garment factories in Myanmar, Cambodia and some other countries to enhance the bargaining power of its products by taking advantage of the special trading privileges granted to the local countries by EU.
FTA has not only helped enterprises cut back on the expenditures on tariffs. The trade preferences have brought about a drastic decline in prices to make the exported products more competitive on the international market.
Latest statistics show Jiangsu-based enterprises have continued to tap into the opportunities brought about by country’s signing of free trade agreements with partner countries with the utilization rate growing from 14% in 2010 to 20.4% in 2016. However, many SMEs are still being kept in the dark about the market opportunities arising from China’s FTAs with other countries.
Industry insiders have pinpointed the elimination or reduction of tariffs as the core of FTA and the certificate of origin, which is dubbed the paper gold, is an important credence for an enterprise to be granted the trade preferences and privileges.
Jiangsu has enhanced the training on the formalities on the application of the certificate of origin to facilitate importers and exporters in their global strategy.
The provincial inspection and quarantine authority hosted 31 training sessions in the first half of this year with the participation of more than 3000 agents from the foreign trade firms across the province.
It has also targeted leading enterprises and small and micro firms for one-on-one instructions.
The provincial authorities in charge of import and export businesses have launched publicity campaigns to help more foreign trade firms in Jiangsu to be aware of the FTA rules and regulations so as to gain the upper hand in international business dealings and economic transformation practices.
From January through July, Jiangsu exported 65.6 billion yuan of goods under the FTA framework with 5.95 billion yuan of tariffs eliminated or reduced, up 46% from a year ago. 13.4 billion dollars worth of goods were imported at the same time with 940 million dollars of tariffs cut due to trade preferences and privileges, up 17.3% year on year.
