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Business / Economy

Li's visit gauges economic pulse

By Zhao Yinan (chinadaily.com.cn) Updated: 2014-11-20 19:08

Premier Li Keqiang visited China's largest wholesale commodity market on Thursday, taking the economy's pulse as a leading factory output indicator slumped to a six-month low.

Li visited shops and booths in Yiwu China Commodities City in Zhejiang province and inquired about difficulties they faced in doing business.

Li's visit came on the same day as the flash HSBC manufacturing Purchasing Managers' Index, a leading economic indicator, fell to a six-month low of 50 from 50.4 in October and well below the 50.3 reading forecast by analysts. A reading below 50 indicates factory activity is contracting.

Qu Hongbin, HSBC's chief economist, said new orders fell to their lowest point since April, indicating increasing disinflationary pressures.

Li, who visited a leading e-commerce village in Yiwu on Wednesday, highlighted the importance of the traditional commerce sector further embracing e-business to adapt to changing customer demand and boost consumption. Experts said the trip is likely to be the last fact-finding visit before the central government convenes for its annual economic meeting in December.

Tamer Noman, a Yemeni businessman who has been living in Yiwu for 15 years, said he has felt the impact of declining orders in recent years, but remains optimistic. "I still believe that the market is good in China."

Yiwu China Commodity City covers an area of 4.3 million square meters, with 62,000 booths and 100,000 suppliers selling 400,000 types of products, from tents to cups, from hairdryers to coats. More than half of the products are exported to more than 215 countries and regions and it has an affiliated website, Yiwugou.com, to facilitate online trade.

Pradip Shetty, an Indian businessman selling incense, said he started to do business in China in 2000.

"I started in Hong Kong in 2000, before moving to Guangzhou province to explore the large market of the mainland. My friends back home always think of Beijing and Shanghai when I talk about China, but they've no idea that Yiwu is also an international city where people are nice and hard working, and you can get to anywhere in the city in 30 minutes," he said.

Although he only moved to the city two years ago, Yiwu has become his home and his daughter is studying in a local school, he said.

In a measure to boost trade, Yiwu municipal government streamlined administrative procedures last year by slashing 48 percent of preconditioned government approvals previously required for businesses. The time needed to set up a domestic company has shortened from five working days to two. As a result, more than 75,000 new businesses were established in the city, 43.6 percent increase year-on-year.

The government has also reduced the company tax burden by one billion yuan ($162 million) in the first ten months of this year.

 

 

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