Why China’s reimports are so high
Why China’s reimports are so high? Reimports made up 8% of China’s total imports in 2008. For some other countries with large re-import values, such as France, UK, Canada, Australia, and Thailand, reimports made up only 0.5-1.2% of total imports.
This is mainly due to the trade between Mainland China and Hong Kong, SAR of China.
Firstly, it shall be clear that China uses general trade system. It determines the coverage of China’s international trade. Imports (including reimports) from China’s trading partners (not free zones) into China’s bonded warehouse are all counted into total imports when the goods cross the border. In this context, China treats Hong Kong as a trading partner, like U.S. or Japan, since Hong Kong belongs to a separate customs district.
Secondly, in terms of partner attribution for imports, China uses country of origin. It means China uses rule of origin to determine its trading partners. If the country of origin is China when importing, then the trading partner is China, i.e. China import/reimport from China, even though goods shipped through Hong Kong, for example.
Thirdly, unlike other trading partners, Hong Kong not only deals with a lot of goods imported from China for inward processing, but also serves as a unique distribution center. Thus, manufactured goods or raw materials originally exported from China to Hong Kong could be simply re-distributed back to China via Hong Kong, and count as a reimport for China.
For further explaination, see the attachment: the country presentation on statistics of goods for processing.
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