Simplified clearance procedures for transhipment of goods help traders ship products quickly to more destinations
China’s exporters that have long been a thriving component of the national economy and strong supporters of global supply chains are finding fresh momentum as the country allows more cities to apply experimental Customs supervision modes for business-to-business e-commerce exports.
Many opportunities are arising from the General Administration of Customs’ move to implement such modes in 10 Customs districts, including in Beijing; Shenzhen, Guangdong province; Tianjin, Hangzhou, Zhejiang province and Nanjing, Jiangsu province, on July 1 to integrate the Customs operations for B2B export of goods.
The administration then expanded this pilot program to another 12 Customs districts, including Shanghai; Nanning, the Guangxi Zhuang autonomous region; Chengdu, Sichuan province; and Xi’an, Shaanxi province on Sept 1, with many of them being inland and western cities.
B2B e-commerce export refers to either the direct export of goods from domestic businesses to overseas businesses via cross-border logistics based on mutual deals over a cross-border e-commerce platform, or the export of goods by a domestic company to its overseas warehouse, from which the goods will be delivered to overseas buyers based on their deals over a cross-border e-commerce platform.
Among other supportive measures, the new program offers e-commerce B2B exporters simplified export declarations and paperless Customs clearance, including one-off registrations, streamlined declarations and expedited clearance at lower costs, said Deng Guangwen, deputy head of GAC’s Nanning Customs district.
Deng said that under the new operational mode, the duration of Customs clearance has been shortened. This helps prevent overdue returns caused by unstable international transportation.
Between July 1 and Aug 30, the 10 pilot Customs districts had inspected and cleared a total of 6.32 million batches of exported goods under the pilot program.
The pilot program will provide cross-border e-commerce B2B exporters in Chengdu, particularly micro, small and medium-sized exporters, with more convenient channels and help “made-in-Chengdu” goods enter global industrial and supply chains, said Li Xuantong, deputy head of GAC’s Chengdu Customs district.
A few thousands kilometers away, the Customs authority in Shanghai has also taken into account the actual circumstances of small businesses, and introduced paperless processes of clearance for certain goods when a single consignment is worth less than 5,000 yuan ($732).
Wang Wenjiang, president of Shanghai Ideal International Logistics Co Ltd, said the company’s export orders recently rose to nearly 300 on a single day, growing 50 percent on a daily basis before the city became a zone for carrying out pilot regulations for cross-border B2B e-commerce exports.
Customs statistics showed that the value of imports and exports transacted online by cross-border e-commerce enterprises reached 604.4 billion yuan in the first half, up 6.7 percent year-on-year. It also unveiled that the number of Customs offices in the pilot program has more than doubled in just two months, showing the program is effective and helpful for companies.
“This certainly reflects China’s accelerating pace of opening up and the world’s surging demand for Chinese goods. The expansion of pilot program is a win-win move and will continue to increase the volume of railway cargo on the China-Europe freight train service,” said Zhuang Rui, deputy dean of the Institute of International Economy at the University of International Business and Economics.
To maintain solid economic fundamentals, the central government has reiterated that policy measures and fiscal funds should be used to ensure focus remains on the “six priorities” of employment, people’s livelihoods, development of market entities, food and energy security, stable operation of industrial and supply chains, and smooth functioning at the community level, and to ensure stability in the six areas of employment, finance, foreign trade, foreign investment, domestic investment and market expectations.
Wei Jianguo, vice-chairman of the China Center for International Economic Exchanges, said that amid the global economic uncertainties caused by the COVID-19 pandemic and weak global demand, China’s foreign trade sector has delivered a better-than-expected performance so far this year, with cross-border e-commerce and trade in services providing strong impetus.
In the first half, trade via cross-border e-commerce platforms－under the oversight of Customs authorities－rose by 26.2 percent year-on-year, with exports and imports up 28.7 percent and 24.4 percent, respectively, the GAC said.
As COVID-19 dealt a heavy blow to traditional trade models, cross-border e-commerce has become a major driving force for stabilizing foreign trade, he said while in China Hangzhou.
Eager to boost foreign trade, the State Council decided at an executive meeting in April to set up 46 comprehensive cross-border e-commerce pilot zones, bringing the total number to 105.
Apart from applying practices proven effective in stimulating the flow of commerce, export-oriented companies in these zones are entitled to enjoy supportive policies, including exemption of value-added and consumption taxes on retail exports. Companies are also encouraged to jointly build and share overseas warehouses.
Zhengzhou, Henan province is one of the second batch of such pilot cities. Total foreign trade via e-commerce channels in the Zhengzhou Xinzheng Comprehensive Bonded Zone surged by 114 percent to 4.45 billion yuan between January and June. Imports in the zone almost doubled from last year, while exports rose more than fivefold.
Because of its advantages, including online trading and contactless delivery, cross-border e-commerce has played a positive role in helping foreign trade firms cushion against COVID-19 shocks and develop a new form of trade, said Qian Fangli, director-general of the department of electronic commerce and informatization at the Ministry of Commerce.
As cross-border e-commerce embraces robust growth, China’s foreign trade performance also beat market expectations in recent months despite the adverse impact from shrinking global demand and restrictive overseas measures to contain the contagion, Qian said.
China witnessed positive growth in exports in April for the first time this year. The momentum was sustained through July as it total foreign trade volume rose 6.5 percent year-on-year to 2.93 trillion yuan during that month, with exports and imports up 10.4 percent and 1.6 percent, respectively, said Customs.
Despite facing a shrinking global trade market, China’s share is growing larger, indicating the rising competitiveness of its foreign trade sector and increasing capacity to counter pressure, said Dang Yingjie, deputy director-general of the National Office of Port Administration at the GAC.
The situation for foreign trade and investment, however, is still grim as the worldwide spread of COVID-19, a severe global economic recession and significant declines in international trade and investment as well as rising protectionism are all taken into account, said Assistant Commerce Minister Ren Hongbin.
To further stabilize foreign trade and push the world’s economic recovery, the central government announced in August it had issued a guideline to roll out more measures aimed at protecting foreign trade entities and keeping supply chains stable.
More efforts will be made to help foreign trade firms expand their clientele and improve trade facilities and services, including cross-border e-commerce platforms, cross-border logistics and overseas warehouses, according to the government document.
For many traditional trade firms, cross-border e-commerce remains a vital option for digital transformation and an effective hedge against external risks, said Zhao Ping, director of the international trade research department at the China Council for the Promotion of International Trade Academy.
Ni Yuefeng, the GAC’s minister, said the administration will further simplify clearance procedures and cut logistics costs to optimize the business environment at ports in the second half. It will continue to advance reforms in the regulation of cross-border e-commerce to help businesses better tap the global market.
GAC currently oversees 42 Customs districts which operate through a total of 678 Customs houses nationwide.
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