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China rolls out policy to boost exports

(Xinhua)
Updated: 2009-05-28 10:27

BEIJING -- China's State Council announced Wednesday further support policies, including expanded export credit insurance, tax breaks and more financial access, to help exporters.

This file photo shows the launch of the Jan Van Cent, a 12,000-tonnage multi-purposed oceangoing freight ship for an export order to the Netherlands, is held at the Yichang Shipyard, in Yichang, central China's Hubei Province, May 9, 2009. [Xinhua]

An executive meeting of the State Council, or Cabinet, also said the country would keep the yuan "basically stable" at a "reasonable and balanced" level to help exporters avoid exchange risks.

Related readings:  China's food export back to growth in March  Dalian fair to promote import and export  China's small commodities hub sees positive export signs  Canton Fair wraps up with export orders down 17%  Integrating to take over export-led growth  China's import and export of electronic products sharply down

The meeting was presided over by Premier Wen Jiabao.

The government will provide $84 billion worth of short-term export credit insurance to trading companies to help increase exports.

Preferential policies and tax breaks will mainly go to labor-intensive and high-tech industries to protect world market share.

Smaller companies would get more financing guarantees from financial institutions, as the government promised to allocate unspecified extra funding from the central budget.

Shrinking external demand that lead to export declines would remain "the biggest difficulty" facing the economy, participants to the meeting agreed.

They also called for coordinated efforts in expanding domestic demand and stabilizing exports, so as to reduce the impact of global financial crisis on China's foreign trade to the minimum.

China raised export rebates on some products after exports shrank on weakening overseas demand since the second half of 2008. For example, the government raised the tax rebate rate for textiles five times since August, most recently last month when the rate went from 15 percent to 16 percent.