16 Mar 2009, 0032 hrs IST, Saibal Dasgupta, TNN
BEIJING: China's ministry of commerce has come up with a unique way of beating the financial crisis. It wants to develop a chain of markets that
will sell second-hand goods like home appliances, cloths and vehicles.
The ministry of finance has ordered state-owned enterprises and state-run banks to put an end to offering stock incentives and enforcement of stock options to employees that were offered earlier. It has also asked these companies to keep management salaries at a "reasonable" level. The order is expected to result in some sharp executive salary cuts.
The market for second-hand goods is limited to a few pockets as Chinese are reluctant to pick up used goods. The commerce ministry's move to create market places for second-hand goods will encourage people to sell off used goods like refrigerators and television sets and go for new ones, a government source said. The ministry expects a decline in new purchases by people hit by the slowdown. Such people could be encouraged to buy second-hand goods. Others may buy new goods after recovering some money by selling used goods.
This is the ministry's way of increasing domestic consumption and helping companies struggling to survive the financial crisis. Hundreds of Chinese companies have lost export markets or seen their exports dwindle. Factories in south and east China has thrown out 20 million migrant workers engaged in low-skill operations after imposing severe production cutbacks or downing shutters.
Premier Wen Jiabao recently allocated vast sums of money to provide subsidy to farmers buying new household goods, farm implements, vehicles and for stocking grains. This is in line with his theory that increasing domestic consumption would help companies survive the economic slowdown and save jobs.
In a circular, the commerce ministry has asked provincial and local governments to set up special markets in small and medium sized cities for selling used goods as a means of stimulating economic growth.
The ministry said the move will help save resources and create a eco-friendly society besides meeting consumer demand. The local governments have been asked to set up a network for the collection and distribution of second-hand goods.
Local governments have also been asked to rope in home appliance companies and large retailers in the task and set basic standards on quality. The ministry also recommended release of quality marks, issued by the second-hand goods industry asocial, on the used goods to ensure good quality. It also went to the extent of asking local governments to train special professionals for these markets.
BEIJING: China's ministry of commerce has come up with a unique way of beating the financial crisis. It wants to develop a chain of markets that
The ministry of finance has ordered state-owned enterprises and state-run banks to put an end to offering stock incentives and enforcement of stock options to employees that were offered earlier. It has also asked these companies to keep management salaries at a "reasonable" level. The order is expected to result in some sharp executive salary cuts.
The market for second-hand goods is limited to a few pockets as Chinese are reluctant to pick up used goods. The commerce ministry's move to create market places for second-hand goods will encourage people to sell off used goods like refrigerators and television sets and go for new ones, a government source said. The ministry expects a decline in new purchases by people hit by the slowdown. Such people could be encouraged to buy second-hand goods. Others may buy new goods after recovering some money by selling used goods.
This is the ministry's way of increasing domestic consumption and helping companies struggling to survive the financial crisis. Hundreds of Chinese companies have lost export markets or seen their exports dwindle. Factories in south and east China has thrown out 20 million migrant workers engaged in low-skill operations after imposing severe production cutbacks or downing shutters.
Premier Wen Jiabao recently allocated vast sums of money to provide subsidy to farmers buying new household goods, farm implements, vehicles and for stocking grains. This is in line with his theory that increasing domestic consumption would help companies survive the economic slowdown and save jobs.
In a circular, the commerce ministry has asked provincial and local governments to set up special markets in small and medium sized cities for selling used goods as a means of stimulating economic growth.
The ministry said the move will help save resources and create a eco-friendly society besides meeting consumer demand. The local governments have been asked to set up a network for the collection and distribution of second-hand goods.
Local governments have also been asked to rope in home appliance companies and large retailers in the task and set basic standards on quality. The ministry also recommended release of quality marks, issued by the second-hand goods industry asocial, on the used goods to ensure good quality. It also went to the extent of asking local governments to train special professionals for these markets.
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