China Freight Forwarder Industry News Reviews May 4th to May 10th
1. The US Customs and Border Protection (CBP) officially announced that it will increase tariffs from 10% to 25% for the third batch of Chinese goods of more than US$200 billion since 0:00 on May 10.
This is the biggest news of the week. The Sino-US trade war is unpopular and involves a wide range of issues. The US announcement has undoubtedly caused complaints from importers and exporters in China and the United States that the increase in tariffs can only result in both losses. At this time when China is strong in manufacturing, if the Trump administration arbitrarily imposes tariffs, the American people will encounter visible consequences such as rising prices and falling living standards. Trump’s strategy can only lead to a temporary relief and result in disaster. His re-election is a time bomb for the lives of the American people. Specific to our industry, to do the freight forwarding of the US line, this year’s off-season may come earlier, lasting longer.
2. The drought hit the Panama Canal, the shipping industry was affected, and the small cabinets to the ports of the US East Coast were limited!
Due to the drought, the water level of Gatun Lake is currently 1.4 meters lower than the normal level in the same period of the previous year, and another water source of the canal is the water level of Lake Alajuela, which is 2.2 meters lower than the normal level.
On May 3, the Panama Canal Authority (ACP) issued a notice indicating that since May 28, 2019, the maximum TFW draft for vessels passing the new Panama Canal lock is 13.11 meters, and that of the ones passing the old Panama Canal lock is 11.73 m TFW. The notice also stated that for vessels exceeding the maximum draft, some may be required to unload the cargo in order to successfully complete the transport. This means that the weight of the cargo carried on the vessel must be reduced and the number of passing vessels reduced accordingly. Correspondingly, the shipping company issues a weight limit. The following are some of the shipping company’s weight limit:
ONE: 8/16/16 Ton with tare included
HAMBURGSUD: 7.5/15/15 Ton with tare included
APL: 8/16/16 Ton with tare included
This will result in a decrease in the revenue of Panama Canal operators. It is estimated that this year operators will lose 15 million US dollars, or about 100 million yuan.
The weight of container loading is subject to many factors. As a freight forwarding company, we must be familiar with the weight requirements of each route, and remind the consignor or consignee in advance to inform the customer that the rules of the shipping company and the terminal must be strictly observed. Otherwise, the costs and risks will ultimately be borne by the shipper.
3. Zhejiang Province Free Trade Zone Agreement Preferential Policy Presentation and ASEAN Preferential Certificate of Origin Visa Practice Training Course held in Hangzhou
On the morning of April 29th, the Zhejiang Provincial Department of Commerce and the Zhejiang Provincial Council for the Promotion of International Trade held a seminar on preferential policies for the Free Trade Zone Agreement and a training course for visas for ASEAN preferential certificates of origin. Deputy Director Han Jie of the Provincial Department of Commerce attended the training and made a mobilization speech.
Lin Wei, member of the Party Committee of the Provincial Council for the Promotion of International Trade, introduced the CCPIT’s issuance of the ASEAN FTA certificate. The training class specially invited the Director of the sixth section of the International Department of the Ministry of Commerce, Song Yang, to give a special introduction on the “China Regional Free Trade Agreement and the Construction of the ASEAN Free Trade Area”, the Director of the Commercial Certification Office of the China Council for the Promotion of International Trade, Zhang Rongrong, to make an introduction on the China’s export commodity brand evaluation system, and the head of the FTA expert group of the China Council for the Promotion of International Trade and the Vice Minister of the Legal Department of the Nanjing Council for the Promotion of International Trade, Zou Ruirui, to give a lecture on “China-ASEAN preferential origin visa practice”.
Although Zhejiang enterprises’ awareness of the FTA has increased year by year, the preferential tariffs on import and export through the FTA have exceeded 12 billion yuan last year, but the overall situation is still low. There are still problems such as insufficient corporate knowledge and inaccurate reporting information. Some companies failed to enjoy the policy dividend. The policy of the training course was meticulous and vivid, and the questions and answers were specific and sufficient, regarding the current bottleneck and difficult problems, and the atmosphere was lively. The training has enhanced the company’s grasp of the preferential policies of the FTA, especially the specific guidance given to enterprises in the development of the market, which has promoted the high-quality development of foreign trade enterprises.
There is a free trade agreement between China and ASEAN countries, and most of the products exported by China to ASEAN countries can enjoy tax rate concessions and reductions. Our export enterprises must improve the training of application of the ASEAN Certificate of Origin (FORM-E), in order to save the tariffs on their products and enjoy the preferential policies brought by the state. The customs clearance requirements in the ASEAN region, especially Indonesia, are very strict and there are many special regulations. For example, Indonesian Customs stipulates that ships imported from China cannot be docked in Hong Kong, Macao and Taiwan, otherwise the Customs will require additional supporting documents. These things are all related to the training organized by the Zhejiang Provincial Department of Commerce, which provides timely guidance and confusing for the majority of enterprises.
4. Shanghai participates in the BRI construction, and the contract value of projects has steadily increased.
The reporter learned from the Municipal Commerce Commission that in the first quarter of this year, the city has filed a total of 186 foreign direct investment projects, of which, the proportion of Chinese investment in the countries and regions along the “Belt and Road” accounted for 10.9% of the total; the ASEAN region is a key area of investment with the amount of Chinese investment in filing accounts for 76.7%. In addition, the number of new contracted foreign contracted projects in the city increased by 52.82% year-on-year. Among them, the number of newly signed foreign contracted projects in the countries and regions along the “Belt and Road” increased by 99.39% year-on-year, accounting for 86.75% of the city’s newly signed contracts; the completed turnover increased by 15.65% year-on-year, accounting for 77.13% of the city’s completed turnover.
In recent years, the municipal party committee and municipal government successively promulgated the “Shanghai’s participation in the “One Belt and One Road” construction implementation plan” and the “Shanghai Leadership of “Belt and Road” construction action plan, the city’s business committee subsequently formulated the Leadership of Belt and Road Construction Implementation Plan, which will continue to deepen the economic and trade investment cooperation with countries and regions along the “Belt and Road”. Up to now, the Municipal Commercial Committee and the Municipal Foreign Investment Promotion Center have signed 55 Memorandums on Economic and Trade Cooperation with relevant overseas government departments and investment promotion agencies, involving 29 countries and regions on five continents, including 10 countries and regions along the “Belt and Road” with a total of 14 Memorandum of Economic and Trade Cooperation. In 2018, the total import and export volume between Shanghai and the countries and regions along the “Belt and Road” increased by 6.0%, accounting for 20.6% of the city’s total. In terms of foreign direct investment and project contracting, last year, Shanghai’s filings for Chinese non-financial direct investment projects along the “Belt and Road” countries increased by 128.9 percent year-on-year, accounting for 17.4% of the city’s total; Shanghai’s contract value of newly signed foreign contracted projects in the BRI countries and regions increased by 20.4% year-on-year, accounting for 73.4% of the city’s total; the completed turnover accounted for 62.6% of the city’s total. Indonesia’s Qingshan Industrial Park, a state-level overseas economic and trade cooperation zone invested by Shanghai Dingxin Investment Construction, has driven more than 24,000 local jobs and created more than 376 million US dollars in tax revenue.
The BRI policies will inevitably promote investment in projects along the Belt and Road, and then the project will be built with many of the equipment and raw materials needed for construction to be transported from China. This is to provide a broad opportunity and space for China’s vast international logistics companies. I hope that our Chinese freight forwarders will rationally allocate resources according to the new situation and strive for more orders regarding the Belt and Road projects.
5. The Ministry of Commerce decided to conduct a final review of the anti-dumping measures applicable to the import-related alloy steel seamless steel pipes imported from US and EU.
The Ministry of Commerce of the People’s Republic of China issued the No. 20 announcement of this year on May 9, 2019, and decided to conduct a final review of the anti-dumping measures applicable to the import-related alloy steel seamless steel pipes imported from the United States and the European Union. At present, the anti-dumping tax rate applicable to US is 14.1%, and EU is 13.0-13.2%.
Necessary countermeasures have been taken by China. We hope that the policies of the Ministry of Commerce can effectively promote the healthy development of relevant domestic industries. As an importing country, China will continue to promote the stable and sustainable development of imported products.