New Chinese Taxes May Explain Export Slowdown
from the that's-all? dept
Last week we linked to a story about slowing export growth from China and wondered what it meant about both the US and Chinese economies. Obviously, slower trade could be a reflection of a weakening economy, although it also seemed possible that the mounting concerns over the quality of Chinese goods could be a contributing factor. Today, the Wall Street Journal notes the same trend, but offers a much more sanguine perspective. The claim is that the Chinese government has instituted a new tax on exporters, which will kick in later this year. As such, manufacturers have tried to front-load their sales, squeezing as much of their annual orders out before the tax comes into place. The Chinese government has tried hard in recent years to slow down the economy, which has been on fire. While this tax may result in a temporary slowdown, it's unlikely that it will do much to alter the fundamental economic equation of high American demand for cheap supply from China.