China has made its export regime "considerably more restrictive" in part because of its efforts to reduce its large trade surplus, the World Trade Organization says in an upcoming review of the country's trade policies, state news agency Xinhua reported Wednesday. “A variety of measures, including export taxes, reduced rebates of [Value Added Tax] on exports and export prohibitions, licensing and quotas, are used to restrain, if not prohibit, exports of a considerable and growing number of products,” stated the WTO report, which is to be published next week. Some of these measures are being implemented to meet the country's international obligations now that it is a member of the WTO, said the report. However, many measures are also intended to cut exports of products that use large amounts of natural resources and energy or to reduce China's large trade surplus in order to reduce trade frictions. “A more flexible exchange rate and thus more independent monetary policy would complement structural reforms, especially those concerning the capital market, and obviate the need for price controls and other non-market measures to contain inflation," the report stated.
Journal of Commerce
