The impact of additional US tariffs on China's manufacturing sector is overall controllable and China will unswervingly promote high-quality development of its manufacturing industry, Wang Zhijun, the vice minister of the Ministry of Industry and Information Technology (MIIT), said at a press conference.
(File Photo: VCG)
Recently, the United States raised tariffs on $200 billion worth of Chinese goods from 10 percent to 25 percent and announced a ban on Chinese telecom giant Huawei from doing business with US companies last week. Will these action hurt the Chinese manufacturing industry and what is the current trade situation? The vice minister summarized the current situation regarding tariff increases at the press conference.
The impact of US tariffs on China's manufacturing sector is manageable
The $200 billion worth of Chinese goods facing tariffs accounted for 41.8 percent of China's exports to the US in 2018 but only 8 percent of China's total exports. Hence the overall impact on China’s manufacturing industry is manageable, Wang said.
The imposition of tariffs by the United States not only affects the interests of Chinese enterprises and consumers, but also harms the interests of Americans, and endangers the security of global industrial and supply chains, Wang added.
According to MIIT, from January to April this year, China's actual utilization of foreign investment in the manufacturing sector increased by 11.4 percent. Some foreign companies, including Tesla and BASF, are increasing their investment in China. This fully demonstrates the confidence that foreign investors have in China’s economy.
Breakthrough in China's chip industry opening more opportunity for worldwide collaboration
Wang pointed that China's integrated circuit industry has been growing by more than 20 percentage a year since 2012. Foreign-invested enterprises contribute more than 30 percent to the Chinese mainland's integrated circuit (IC) industry sales, which reached 653.2 billion yuan ($94.86 billion) in 2018.
China will further develop its global integrated circuit industry ecosystem in a larger scope and on a deeper level. “We will continue to pursue more open, innovative and cooperative development of all links in the industrial chain,” Wang added.
China's industrial sector growing steadily and moderately
China's value-added industrial output, an important economic indicator, expanded 5.4 percent year on year in April, conveying that China's industrial sector is growing in a steady and healthy manner, Wang said.
In April, the output of the high-tech manufacturing sector surged 11.2 percent, more than double the pace of overall industrial output growth. Investment in high-tech manufacturing and services surged 11.4 percent and 15.5 percent year on year, respectively. The output of new industrial products with higher technical content and higher added value maintained rapid growth. Output growth of 3D printing equipment, mobile communication base station equipment and other products remained above 30 percent.
Unswervingly open up the manufacturing sector and tackle key problems in core technologies
China will continue to promote and improve the opening up of its industrial sector and fully implement its policy of “pre-establishment national treatment” plus a negative list management system, Wang said.
The trade tensions between China and the US have made us more aware of the need to consistently support key core technologies. The MIIT will strengthen policy coordination with relevant departments, actively encourge enterprises to play the main role of economic development, and vigorously promote the development of core technologies in key areas, Wang concluded.