Presentation1_G6

8/6/2019 Presentation1_G6

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1.1. Fiscal policy1.1. Fiscal policy

1.1.1. Taxation policy1.1.1. Taxation policy- Chinas taxes on goods and services contribute to 48.3

percent of its total tax income

- China also considers expanding the coverage of VAT

and reducing business tax items to simplify the taxation

system and avoid double tax collection

- Chinas personal income tax only accounts for 4.7

percent of its entire tax revenue,

- The Chinese government encourages its advanced

technology development by reducing the relative

enterprise income taxes


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1.1.2. Government revenue and expenditure

Gov revenue

Gov expenditure

Source: www. Starmass.com/china



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1.2 Monetary policy1.2.1. Exchange rates

The early '80s, China has allowed the

implementation of mechanisms to adjust rates to

reflect declining purchasing power of the yuan.

In 1994, to control rate adjustment policy remain

stable, China has implemented policies to

strengthen foreign exchange management, aims to

increase amount of foreign currency in State Bank,

ensure supply and demand of foreign Currency

smoothly. Now, when China's economy has grown,

foreign exchange reserves were U.S. $ 2.85 trillion.


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1.2.2. Rate of reserve requirement

In order to control inflation, in 2010, Central Bank ofChina has increased rate of reserve requirement six

times from 15.5% in late 2009 to 18.5% in December2010

According to the Central Bank, a prudent monetarypolicy to control and stable price will be the toppriority of the bank in 2011.


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In 2010, China committed to implementation ofreduction of tax with the WTO.

- Implementation of import tax reduction for sixcommodities such as vegetable

To promote parallel trade relations and multinational,China will impose special taxes on goods from areassuch as the European Union's 10 countries, Chile,Pakistan, New Zealand and South Nations. For someproducts from Hong Kong or Macao, China completely

eliminated the tax. In addition to the 41 countries aredeveloping slowly as Laos, Burma, Ethiopia ... policy also

applies to tax exemptions.


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1.3.2. Foreign investment



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2. SOCIAL

2.1. Education

In 1949, the illiteracy rate in China was 80% butby 2010 this ratio dropped to 3.5%. China is a

country where the number of people withuniversity degrees highest in the world, up 265times in the past six decades.

However, the gap in education in urban andrural China is growing. Many Chinese incountries do not have the opportunity to enrollschool and access new technologies.


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2.2 Labor: unemployment rate

The unemployment rate in urban areas incountry at 4.1% in late September 2010, with 9.05million people out of work

In the 9 months of 2010, total of 9.31 million new jobs were created in urban areas, in excess ofthe target 9 million jobs should be created.The Chinese government has launched several

measures to promote jobs, including: helpinggraduates and labor from rural areas seekingwork through facilitating practical andvocational training institutions.


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2.3. Living standard:

Healthcare, life expectanceAnnual disposable income per capita for rural households and urban

households

Source: www.starmass.com/china


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REFERENCE

The Case for Trade Liberalisation in Developing Countries Journal of

Economics Perspectives Winter 1992 pgs 69-85 (available through LeedsMet

Intranet)

Ocampo J.A. and Taylor L (1998) Trade liberalisation in developingcountries: Modest benefits but problems with productivity growth,

macroeconomic prices and income distribution Economic Journal

September 1998 (available through LeedsMet Intranet)

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