China Focuses on Internet TV Sales
Web Television and Phone Technology Lead Chinese Import Gains
Aug 26, 2009
During the first 6 months of 2009, the fastest-growing product category for Canadian imports from China was television reception equipment. These hi-tech imports were up 456.7% from the same period last year.
Internet Television Modem Boxes
Included in television reception equipment are set-top boxes with modems that connect to the Internet. This technology enables consumers to use their televisions to communicate via the Web. Ironically, imports of these microprocessor-based Internet boxes (tariff item code 8528.71.20) are duty-free, so the Canadian government is missing out on tariff revenues on a top import product from China.
Internet TV and Phone Technology
Printed circuit assemblies provided another opportunity for China to solidify its position as one of Canada’s leading technology suppliers. Canadian imports of printed circuit assemblies are up so far this year by 208% over 2008.
Printed circuit assemblies are key telecommunication components that provide the backbone for cellular communication devices and wireless communication networks. These networks include Internet TV and phone systems. Under tariff classification code 8517.70.00, these technological devices from China are not subject to custom duty.
Oil and Gas Drill Piping
China also sold US$125.5 million worth of non-stainless steel drill piping to Canada’s oil and gas companies in the first half of this year, a robust gain of 370% over last year. Canada also receives no tariff duties for oil or gas drill pipe, including non-stainless steel piping under tariff code 7304.29.00.
Despite these improvements, overall Canadian imports from China for 2009 were down 14.2% to $15.66 billion from the $18.25 billion consumed from January to June in 2008.
Fastest Growing Canadian Imports from China in First Half of 2009
From the 25 most popular Chinese imports, the only 6 products that Canada imported from China with percentage increases from comparable sales during the first 6 months of 2008 are listed. The list is in order of items with the highest percentage gains in import sales.
In addition to the value of Canadian imports from China and the 6-digit tariff classification code within brackets, the following summary presents the percentage change for each product compared with consumption for the same 6-month period in 2008.
- Television Reception Equipment (tariff item 852871) … $140 million (up 456.7%)
- Non-Stainless Steel Oil or Gas Drill Pipe (730429) … $125.5 million (up 370.5%)
- Wireless Network Printed Circuit Assemblies (851770) … $205.6 million (up 208%)
- Knitted Cotton Sweaters, Sweatshirts and Coats (611020) … $138.6 million (up 9.5%)
- Rubber or Plastic Footwear (640299) … $135.3 million (up 5.8%)
- Taps, Valves and Similar Appliances (848180) … $92.5 million (up 1.1%)
Under the Most Favored Nation tariff treatment, only 3 of the above imported products from China are subject to tariff duty.
Knitted cotton sweaters, sweatshirts and coats are subject to a hefty 18% tariff when imported from China. Similarly, Chinese rubber or plastic footwear is assessed a 17.5% duty by Canadian Customs officials. Television reception equipment from China have custom duties ranging from 0% to 5% depending on a tariff item’s sub-classification. As noted above, Internet TV modem boxes are duty-free.
Top 25 Imports from China into Canada in First Half of 2009
The effects of the global recession are evident in the decreased imports of consumer items including computers, video games, cell phones and digital cameras from China.
- Computers, Laptops, Notebooks (tariff item 847130) … US$869.6 million (down 3.4% from 2008)
- Toys including Dolls and Puzzles (950300) … $291.5 million (down 23.1%)
- Video Games (950410) … $285.7 million (down 30.9%)
- Switches and Routers for Voice, Images or Data (851762) … $234.3 million (down 2.4%)
- Cellular Phones and Other Wireless Phones (851712) … $224.5 million (down 4.8%)
- Wireless Network Printed Circuit Assemblies (851770) … $205.6 million (up 208%)
- Leather Footwear (640399) … $183.9 million (down 4.5%)
- Computer Monitors (852851) … $177.7 million (down 49.1%)
- Other Computer Parts And Accessories (847330) … $164.2 million (down 30.9%)
- Metal Furniture Not For Office Use (940320) … $149.2 million (down 10.8%)
- Female Cotton Trousers, Overalls and Shorts (620462) … $148 million (down 11.2%)
- Golf Bags, Tool Bags, Other Plastic or Textile Containers (420292) … $144.2 million (down 1.3%)
- Television, Digital and Video Recorder Cameras (852580) … $144 million (down 25.6%)
- Television Reception Equipment (852871) … $140 million (up 456.7%)
- Knitted Cotton Sweaters, Sweatshirts and Waist-Coats (611020) … $138.6 million (up 9.5%)
- Rubber or Plastic Footwear (640299) … $135.3 million (up 5.8%)
- Sound Recording Equipment (851981) … $130.3 million (down 23.1%)
- Non-Electric Iron or Steel Cooking Appliances (732111) … $129.1 million (down 8.7%)
- Non-Stainless Steel Oil or Gas Drill Pipe (730429) … $125.5 million (up 370.5%)
- Plastic Articles (392690) … $124,116 million (down 3.1%)
- Upholstered Seats with Wooden Frames (940161) … $120.9 million (down 34.5%)
- Wooden Furniture for Other Use (940360) … $118.8 million (down 20.2%)
- Electric Static Converters (850440) … $106.7 million (down 13.4%)
- Non-Portable Computers (847141) … $100.8 million (down 17.4%)
- Taps, Valves and Similar Appliances (848180) … $92.5 million (up 1.1%)
Like Internet TV and Web phone equipment, consumer technology products such as computers, video games, cell phones and digital cameras imported from China into Canada are tariff-free.
See also Flat Screen Exports to China Soar.
Sources: Trade Data Online from Industry Canada, based on Statistics Canada reports as of August 24, 2009 and Canada Border Services Agency's online customs tariff manual.
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