Beijing is to raise tax rebates for exports affected by currency devaluations in neighbouring countries, Shanghai mayor Xu Kuangdi says. He did not reveal the new rate, but said the decision to raise the value-added rebate was made by the central government in a top-level economic work conference last month. The rebate was cut to 9 per cent in January 1996, from 17 per cent. Mr Xu said mainland textile and toy exports were the main sectors affected by the weaker currencies of Southeast Asian countries. 'For sectors affected [by the devaluations], such as textiles and toys, the country will adopt some measures, such as raising the tax rebates,' he said. Peat Marwick China tax principal Peter Kung said the move would 'only alleviate exporters' burden slightly, as other countries with similar value-added taxes tend to give a 100 per cent rebate'. Exporters have been lobbying Beijing to devalue the yuan to maintain competitiveness, but their appeals so far has fallen on deaf years. Mainland leaders, including vice-premier in charge of economic affairs Zhu Rongji, have indicated that devaluation is out of the question, although rumours of such a move continue. Beijing said it would slash fees to lower the cost of doing business for exporters, and it has cut interest rates three times in 17 months. Yesterday, Mr Xu said Shanghai would not adopt special measures to help exporters, although the Asian financial crisis would have some impact on its economy, and its exports. 'The currencies of South Korea and Japan have weakened [against the US dollar] and, as we settle our exports in US dollars, our sales to these countries will be affected,' he said. The city has forecast a growth rate of 10 per cent for this year, from last year's 12.7 per cent. 'We have set a target of 10 per cent for the year, but the actual growth could be between 10 per cent and 11 per cent,' he said.