Chinese Ministry of Commerce: An Overview

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This is a presentation I used in a graduate school class in April 2006, as a preface to visiting China. …

This is a presentation I used in a graduate school class in April 2006, as a preface to visiting China.

For more information and some notes, see:
http://www.ariwriter.com/2008/10/on-the-china-ministry-of-commerce-and-my-first-slideshare/

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Transcript

  • 1. MOFCOM : Ministry of Commerce By Ari Herzog April 27, 2006 Suffolk University
  • 2. Birth in March 2003
    • Born to eliminate redundancy
    • MOFTEC (formerly MOFERT)
    • +
    • SETC
    • +
    • SDPC
    • =
    • MOFCOM
  • 3. Departments/offices
    • General Affairs Office
    • Personnel, Education and Labor Department
    • Policy Research Office
    • Law Department
    • Planning and Finance Department
    • Asian Affairs Department
    • Northwest Asian and African Affairs Department
    • Europe Department
    • America and Oceania Department
    • Taiwan, Hong Kong and Macao Office
    • International Economic and Trade Relations Department
    • WTO Department
    • Foreign Trade Department
    • Machinery and Electric Equipment Import and Export Department
    • Scientific Development and Technological Trade Department
    • Market System Department
    • Commerce Reform and Development Department
    • Market Operations Regulation Office
    • Foreign Investment Department
    • External Aid Department
    • External Economic Cooperation Department
    • Import and Export Fair Trade Bureau
    • Industrial Damage Investigation Bureau
    • Information Technology Department
    • Foreign Affairs Department
  • 4. Responsibilities
    • Formulates and coordinates guidelines, laws, policies, regulations, plans, strategies, and administration of domestic and international trade and international economic cooperation
      • foreign investment
      • foreign government loans and assistance programs
      • overseas projects
      • technology trade with foreign countries
      • tariffs, taxation, exchange rates, credit, and pricing
      • economic relations with Taiwan, HK, and Macau
  • 5. Ministers
  • 6. January 2006: FDI in China
    • FDI up 11% in Jan 2006, from Jan 2005
      • $4.55 billion USD
      • HK, British VI, Germany led investment
      • 15 EU countries grew by 70.8%, US by 19.7%
    • 3,044 new foreign firms set up shop
      • 14.5% decrease
  • 7. Future investments
    • PricewaterhouseCoopers survey of CEOs in Jan 2006
      • 55% to invest in China now through 2009
        • 75% want to win Chinese customers
        • 48% want to decrease labor costs
  • 8. Potential tax rate change
    • Today, domestic firms pay income tax rates of 33%, foreign firms taxed at 15%
    • National People’s Congress to discuss in 2006 to unify the rates.
    • Also, plans for future tax breaks.
  • 9. China support of key export brands
    • 2003: 65% market share for top 10 brands of 80 consumer products
    • 80% market share for top home appliance brands
    • 20% of export enterprises had own brands; < 10% of total exports
    • Lack of IPR in tech firms
    Source: Hong Kong Trade Development Council website - www.tdctrade.com/alert/cba-e0507a-3.htm
  • 10.
    • 190 domestic export brands fostered in 2005-2006: includes Haier, Gree, Xoceco, Galanz, Jialing, Huawei, ZTE, Ordos and Threegun
    • 71 from mechanical and electrical industry
    • 55 from textile industry
    • 40 from light industry, arts and crafts
    • 10 from food, native produce and animal by-product industry
    • 7 from metals, minerals and chemicals industry
    • 7 from pharmaceutical and health food industry
  • 11. WTO: China #1 exporter by 2011
    • 2005 world trade volume was > $10,000 billion USD, 13% increase over 2004
    • Largest export increase by Russia (37%), China (28%), and Brazil (23%)
    • Top 3 goods export countries were Germany, US, and China
    • WTO prediction that China would take the place of Germany as the largest goods exporter in 2007 if China maintained 30% export increases
    • WTO prediction that China would be #1 goods exporter by 2010 at latest
    Source: Network Center of MOFCOM, 4/20/06
  • 12. MOFCOM Online Resources
    • China Commodity Net http://ccne.mofcom.gov.cn/
      • Allows free searches for info of 600,000 Chinese enterprises and 2.2 million products
    • World Importers Net http://win.mofcom.gov.cn/en/
      • Free. Promotes intl trade by allowing Chinese and foreign firms to upload pics and descs of products to buy/sell
    • Bizmatching http://bizmatching.mofcom.gov.cn/en/
    • Invest in China http://www.fdi.gov.cn/main/indexen.htm
    • MOFCOM’s US Commercial Counselor (at Embassy) http://us2.mofcom.gov.cn/