¡¡¡¡Cong Ming
¡¡¡¡Deputy Director of the Research Office of the State Council

¡¡¡¡Currency control will be tightened to prevent surplus of flow and over-lending by banks, as more than 3,600 billion Yuan was released in loans in 2007, way above the planned amount of 2,800 billion Yuan. This adjustment will have significant effects on banking, insurance and real estate sectors, but only an indirect influence on shipping.

¡¡¡¡New tax law

¡¡¡¡The new tax law has lowered statutory apparent rate from 33% to 25%, which will cut State revenue by an estimated 93 billion Yuan per year. However, the new policy will be adopted progressively, mainly targeting domestic companies in 2008. Benefits will vary from industry to industry, with those engaged in transportation, who were taxed at the rate of 20.8% in 2006 (a level that was higher than the nation¡¯s average), particularly advantaged.
¡¡¡¡Areas that are covered by the new law include agriculture, forestry, husbandry and fishing projects, infrastructure construction projects (such as port, terminal, airport, railway, highway, power and water conservancy), environmental protection projects and energy/water conservation projects etc. Companies that are engaged in the above fields will pay no tax for two years from the day when the first sum of income was made and will have their income tax cut by half for three following years.

¡¡¡¡Foreign trade policy

¡¡¡¡Efforts will be made to stabilise exports and increase imports in 2008, especially the import of energy resources, grains and high-tech products etc.

¡¡¡¡Price policy

¡¡¡¡Partly for temporary price control on foodstuffs and some vital commodities and partly for the importance of transport in national economy, freight adjustments will become necessary and unavoidable in 2008 and thus bring palpable development opportunities to shipping.