Effective from December 1, the decision of China’s Finance Ministry aims to encourage consumers to spend more in the country rather than on overseas travel, and is also thought to be part of a shift towards creating a consumption-driven economy; from a low-cost manufacturing and export model.

“The reduction of import tariffs on clothing, dairy products, food and other consumer items mean domestic suppliers will have to become more competitive, which will benefit the Chinese economy and consumers in the long run”, Doug Lippoldt, Chief Trade Economist, HSBC, told the BBC.

The announcement was made shortly after U.S. President Donald Trump visited the country. Foreign governments and business groups have frequently complained that China’s high tariffs on foreign goods represented an unfair trade barrier. However, domestic products in certain segments are said to still fail to reach the high quality of the imported equivalents.

A total of 187 consumer goods are concerned by the new measure. The high tariff rates on many foreign goods meant that many middle and upper class Chinese consumers would often fly overseas to combine holidays with shopping sprees.

Sources: BBC/China Briefing