China Offers Tax Rebates to Textile Industry

123jump.com Staff
05 Feb, 2009
New York City

China offered tax rebate to textile and equipment industries. China in the last three months has offered similar subsidies to home buyers, banks and small businesses. The latest move is part of the broader attempt by China to sustain the latest economic expansion in the face of exports.

[R]6:00AM New York, 6:00PM Hong Kong- China increases textile industry tax rebate by one percentage point to 15%.[/R]

Hong Kong market averages advanced after China''s top decision making body State Council announced a one percentage point increase in tax rebate for the textile industry to 15%. Similar measures were also unveiled to support the equipment manufacturing industry.

In Hong Kong trading Hang Seng Index gained 0.9% or 115.01 to 13,178.90, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, advanced 3% or 214.09 to 7,455.81. In Shanghai trading CSI 300 index fell 0.7% or 15.44 to 2,150.97.

Daily turnover on main-board was HK$52.8 billion compared with HK$36.5 billion yesterday.

China to Increase Tax Rebate to 15% for Textile Industries

China''s State Council yesterday increased the tax rebate on textile and garment exports by one percentage points to 15% from 14% as part of a stimulus package for the industry.

Similarly a support plan for the equipment manufacturing industry was approved yesterday.

According to the report, profit in the country''s textile industry fell 1.8% to Rmb104.2 billion in the first eleven months of 2008 from a year earlier, dropping for the first time in a decade.

China Can Grow 8%, IMF

Xinhua News Agency reported today that International Monetary Fund managing director Dominique Strauss-Kahn said China has the potential to reach the 8% growth target this year, although it is very challenging.

IMF forecasts that the country''s economy will rise 6.7% this year.

Kahn said it was unlikely for Asian economies to regain lost momentum when other economies are in difficult economic circumstances.

Gainers & Losers

Hong Kong stocks gained 0.9% led by financial stocks on hopes of a stimulus package from China and ICBC advanced 3.9% and Bank of Communications increased 4.4%.

Insurance stocks gained. China Life soared 3.9% and Ping An Insurance rallied 7%.

Esprit Holdings dropped 4.8% after reporting its first quarterly profit decline in a decade and Lenovo fell 2.7 after announcing its first loss in three years.

CITIC Pacific increased 5.4%.

Shipping lines also gained as the Baltic Dry Index, a measure of freight charges, edged up 15%. China Cosco increased 14.4%.