Zero export tariff for textiles & other items to Mainland next year

21 Jul '05

3 min read

China's mainland is set to implement zero tariffs on all products produced in Hong Kong from January 1, 2006.

This decision will mark the beginning of the third phase of the Closer Economic Partnership Arrangement (CEPA) between the two sides.

The dropping of tariffs was revealed last week by Wang Liaoping, director of the Taiwan, Hong Kong and Macao Affairs Department of the Ministry of Commerce.

The official said that under the arrangement, an additional 300 categories of Hong Kong products, ranging from textile products, garments, and food to electrical products and machinery, would be covered by the zero-tariff agreement.

All Made-in-Hong-Kong products will be tariff-free when being exported to the mainland.

Wang said the two sides had reached an accord over the standards of origin of watches and clocks, a market in which Hong Kong is advanced, so that watch and clock products processed in Hong Kong would enjoy qualified tariff-free treatment.

As for the service sector, the mainland is also to open more industries to Hong Kong investors in addition to the existing 26, such as logistics, distribution, advertising and tourism, which are already available.

According to a survey conducted by Hong Kong authorities, its manufacturers, taking advantage of CEPA, are expected to double their exports to the mainland in 2005.

The framework of CEPA was expected to help the two sides overcome the obstacles of tariffs as well as accelerate integration of the two economies, Wang said.