Chinese people shop overseas. (Photo/Xinhuanet)

Minister of Commerce Gao Hucheng said at the third sessions of the 12th National People's Congress (NPC) that Chinese consumers spent a whopping sum of more than 1 trillion yuan (163 billion U.S. dollars) overseas last year. This issue attracted a lot of attention at the two sessions with many representatives seeking to identify causes and suggest solutions.

Price differential is a key factor

The amount of money that Chinese consumers spent overseas last year represented 27 percent of global outbound travelers' expenditure and ranked No. 1 in the world. In 2014, Chinese consumers bought almost half of the luxuries in the whole world, and 76 percent of these purchases were made overseas.

High tax rates on some products in China and the pricing strategies of some foreign brands lead to higher prices for the same products in China, said Gao, adding that there is also room to reduce costs and cut prices by improvements in logistics and business management.

Support for the domestic duty-free business

"Chinese tourists have a strong demand for duty-free products. The current tax-exempt market of China is still not sound enough, with very few duty-free shops, limited duty-free products, and low quotas for duty-free shoppers. Consequently, Chinese people have to go abroad to shop," says Zhang Xuewu, a member of the national committee of the CPPCC and the Chairman of China Travel Service(HK)Group Corporation. He suggested opening more duty-free shops, expanding the range of duty-free products, and increasing the quotas for duty-free shoppers.

Duty-free shopping malls are an extension to and supplement of duty-free shops at airports and ports - an important part of the tourist industry. The development of tax-exempt businesses can not only encourage spending but can also provide more job opportunities, promote domestic high-end brands, promote international trade and improve the balance of payments, and increase the tourist industry's ability to compete.