Guangdong province, a major economic powerhouse in southern China, announced on Thursday a series of new measures and policy updates aimed at boosting market confidence, economic vitality, and high-quality development.
The policy package covers a wide range of areas including manufacturing, foreign trade, rural vitalization, self-employed businesses, and finance, with the aim of providing support to local enterprises. Speaking at a news conference in Guangzhou, the province’s capital, Hu Hong, deputy Party secretary of Guangdong, revealed that there are 22 updates in the policy package targeting enterprises, including reductions in financing guarantee costs for smaller enterprises, supporting industries paying value-added taxes, and further exempting taxes on new energy vehicle purchases.
Additionally, the package contains 25 new measures, such as pushing forward the standardization of preliminary work among investment projects in seven key sectors, incubating more quality enterprises, and reducing highway tolls. There are also 12 measures that are extensions from previous effective policies, such as reductions in value-added taxes for some taxpayers and support for major foreign-invested projects.
The move aims to stabilize external demand while further expanding domestic demand and providing a sound business environment for market players, according to Hu. While an accelerated economic recovery has been witnessed recently, quite a number of enterprises still face difficulties. This policy package is expected to address these challenges and provide support to businesses struggling in the current economic climate.
The policy package on foreign trade includes the full resumption of land transport between Guangdong and Hong Kong to pre-COVID-19 levels and efforts to increase sea and air routes, said Sun Bin, deputy director of the provincial commerce department. In addition, 242 overseas trade shows are planned this year to help enterprises achieve more orders.
To further facilitate lending to foreign trade companies, export credit insurance will be significantly expanded, Ni Quanhong, deputy director of the Guangdong Financial Supervisory Authority, said. New social financing in the province is expected to amount to 4 trillion yuan ($580.2 billion) this year, a year-on-year increase of 500 billion yuan.
According to a report by the provincial statistics bureau, Guangdong is seeing more positive signs of economic recovery in sectors such as cultural and tourism consumption and investment projects. However, the contracting external demand and domestic consumption restrained by the recovering employment and income levels are still challenges in need of solutions. The rebound in offline consumption and services scenarios is expected to outpace that of the manufacturing sector by the first quarter of this year, while the industrial sector is projected to continue to pick up in the second quarter thanks to related supportive measures and a low comparison base last year. The sector is expected to get back on a normal track in the second half of the year.
Overall, the policy package is expected to support businesses and provide the necessary measures to stabilize external demand and further expand domestic demand, resulting in a sound business environment for market players in Guangdong province.