Category Archives: China Economic Policy

Made in China 2025 Explained (video)

Made in China 2025 is the first 10-year strategic plan of China in building a strong power in manufacturing. The plan was made based on the new international and domestic environment aimed at improving the quality and level of China’s manufacturing industry. It is a blueprint for China’s plan to transform the country into a hi-tech powerhouse that dominates advanced industries like robotics, advanced information technology, aviation, and new energy vehicles.

4 Big Reasons Why China Holds U.S. Treasury Bonds

Since economic reform in the 1980s, China keeps buying U.S. Treasury Bonds for more than 3 decades. What’s more, the US trade deficit with China is the largest in the world (about 30 billion per month) which is usually regarded as a sign of global economic imbalance ( 2016). While China’s huge holding of U.S. securities is widely evaluated as a nuclear bomb, below are the big reasons behind the long-term national behavior:-

Why China devalues the Chinese yuan (renminbi)

In August 2015, the People’s Bank of China announced a surprising decision to depreciate the Chinese Yuan by 2% against the U.S. dollar. The central bank said in a statement that “The reform of Chinese Yuan exchange rate formation mechanism will continued to be pushed forward with a market orientation, the market powers will play a bigger role in exchange rate determination to assist the balancing of international payments” ( 2015).

10 Reasons Why China is Successful and Efficient

“Made in China” really doesn’t mean what it used to be, quality of Chinese-made products is rising fast. In addition, China is moving very fast in technological innovation. For example, in the past five years, China saw a rapid growth in its IP (invention patent) community, reflected by its innovative companies and the whole society, according to WIPO report ( 2015). Since opening up its economy and market in the 1980s, China has been successful in growing its economy and utilizing its demographic bonus efficiently.

Small and micro enterprises are temporarily exempt from VAT and business tax in China

According to the State Administration of Taxation, Ministry of Finance, to further support the development of small and micro enterprises, the State Council approved that August 1, 2013 onwards, the small-scale VAT taxpayers with sales of businesses not exceeding 20,000 yuan will be temporarily exempt from VAT; business tax taxpayers (corporate or enterprise units) with monthly turnover not exceeding 20,000 yuan can be exempt from sales tax.