China's current account surplus grows

Amid its economic slowdown, China's current account surplus rose to USD 330.6 billion last year even though its capital and financial account posted a deficit, Chinese foreign exchange regulator said today.
The current account surplus of the world's second largest economy was USD 330.6 billion last year, up from USD 219.7 billion in 2014, according to the State Administration of Foreign Exchange said.
The goods-trade surplus hit USD 567 billion in 2015, but the service trade posted a deficit of USD 182.4 billion, it said in a statement.
Deficit under the capital and financial account rose to USD 142.4 billion at the end of December, up from USD 63.4 billion in the third quarter of 2015.

Reserve assets, most of which are foreign exchange reserves, decreased by USD 342.9 billion last year, compared with an increase of USD 118.8 billion in 2014.
China started to post deficits on its capital and financial accounts in the second quarter of 2014 due to rapid increases in overseas investment and speculation on the depreciation of the yuan.

In his report, Finance Minister Lou Jiwei said China will
further reduce tax burdens for enterprises and closely follow the implementation of the replacement of business tax with value-added tax (VAT).
China plans to formulate a pilot policy on commercial pension insurance with individual tax preferences offered to applicants, Lou said.

Also, China is mulling an increased export rebate rate for some mechanical and electrical products and improving the policy on individual income tax for equity incentives, Lou said.
The central government will promote public- private-partnerships (PPP) and accelerate the PPP legislation procedures, he added.
China has also promised to review government investment, promoting the use of funds to support startups in emerging industries, Lou said.