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- Taxes alone won't cut trade surplus: official
Date: 29-May-2007 Sources: (Shenzhen Daily)
NEW export taxes on polluting and energy intensive industries will help reshape how China's economy grows, but alone are not enough to resolve its trade imbalances with the United States, a top commerce official said Sunday.
The government said last week it would impose or increase taxes on a range of metal exports in an effort to control shipments of high-energy-consuming products and ease its huge trade surplus.
'You cannot expect to resolve the trade balance by simply curbing export patterns,'Vice Commerce Minister Gao Hucheng told reporters on the sidelines of a conference when asked about the changes.
'These products make up a relatively small portion of exports. But the point is that this reflects changes in trade and economic growth, which will have advantages in the short term and even greater significance in the long term.'
The announcement of the tax changes came ahead of the strategic economic dialogue in Washington between high-level Chinese and U.S. officials at which China's huge trade surplus was a major bone of contention.
From June 1, China will impose a tax of between 5 and 10 percent on exports of more than 80 types of steel products.
Exports would not slow down much this year since most contracts had been signed already, but next year could see a big fall-off, said Li Xinchuang, vice president of the China Metallurgical Industry and Research Institute.
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