China expands market procurement trade pilot program to boost foreign trade

China recently expanded its market procurement trade pilot program to cover 17 new marketplaces located in Inner Mongolia Autonomous Region, Guangxi Zhuang Autonomous Region and provinces of Liaoning, Zhejiang, Anhui, Fujian, Shandong, Henan, Hubei, Guangdong and Yunan, in an effort to boost foreign trade, reported the Xinhua-run Shanghai Securities Journal on Friday.

The mode of market procurement trade refers to qualified exporters purchasing with a single declaration value of no more than 150,000 U.S. dollars at approved and designated marketplaces. The new format of foreign trade features simplified customs clearance and value-added tax exemption.

China's Ministry of Commerce (MOC) started piloting market procurement trade in Yiwu, east China's Zhejiang Province in 2013.

After the expansion, a total of 31 marketplaces are included in the market procurement trade pilot scheme, covering 15 provinces and regions in the eastern, central and western China. Specially, the inclusion of the marketplaces in Inner Mongolia, Guangxi and Yunnan, the first time in history, is expected to play a positive role in the development of foreign trade in those border areas.

It is natural for China to expand the pilot run of market procurement trade, as the mode has become more mature with greater vitality and yielded fruitful outcomes in boosting the export of labor-intensive products by small and medium-sized enterprises, according to Bai Ming, deputy director with the international market research institute of Chinese Academy of International Trade and Economic Cooperation under the MOC.

The trade mode offers a convenient channel for micro, small and medium-sized enterprises in Shaoxing, Zhejiang Province to export characteristic products such as textiles, clothing and pearls and participate in international trade, said an official with the department of commerce of Shaoxing.

The market procurement trade has been a highlight of foreign trade since the start of this year. Data showed that China's market procurement export reached 434.95 billion yuan in the first eight months, jumping 31.5 percent year on year.

In the next step, the MOC will continue to promote the development of market procurement trade to inject new impetus into the innovative development of foreign trade, said an official with the MOC.