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Gao Feng: Members of the press, good afternoon. Welcome to MOFCOM Regular Press Conference. To start with, let me share two pieces of information.
First, on China’s FDI utilization from January to April this year.
From January to April 2021, 14,533 foreign-invested enterprises were established nationwide, an increase of 50.2% year-on-year and an increase of 11.5% over the same period in 2019. The paid-in FDI in China was RMB397.07 billion, a year-on-year increase of 38.6% (equivalent to USD59.04 billion, a year-on-year increase of 42.8%; excluding banking, securities and insurance, same below), and an increase of 30.1% over the same period in 2019.
In terms of industry, the paid-in FDI for services was RMB312.94 billion, up 46.8% year on year. The paid-in FDI for hi-tech industries increased by 29.1%, among which high-tech services increased by 34% and high-tech manufacturing by 15.4%.
In terms of the origin, the paid-in FDI from BRI countries, ASEAN and EU increased by 62.8%, 65.2% and 9.2% respectively (including investment via free ports).
In terms of regional distribution, FDI in eastern, central and western China increased by 39.1%, 37.5% and 30.3% respectively.
Second, on China’s automotive consumption from January to April this year.
From January to April this year, the consumption potential of China's automobile market was further released, and new vehicle sales, second-hand car transactions and the number of scrap motor vehicles recycled all achieved rapid growth, with the following key features:
First, new energy vehicles were popular. According to the China Association of Automobile Manufacturers, 8.748 million new vehicles were sold from January to April, up 51.8% year-on-year and 4.5% higher than that of the same period in 2019; 732,000 new NEVs were sold, up 2.5 times year-on-year and doubled compared with the same period in 2019.
Second, second-hand car transactions were more active. According to the statistics of China Automobile Dealers Association, 5.445 million used cars were traded from January to April this year, up 74.6% year-on-year and 22.2% compared with the same period in 2019.
Third, the old motor vehicles had become obsolete faster. According to the Ministry of Commerce, 817,000 scrapped motor vehicles were recycled in the first four months of this year, up 58.7% year-on-year and with an increase of 20.9% compared with the same period in 2019.
These are the announcement I need to make today. I am ready to take your questions. The floor is open.
China Business News: In March this year, China's total import and export of services increased by 7.9%, the first time to achieve a positive monthly growth since the outbreak of COVID-19. How does the Ministry of Commerce evaluate the recovery of China's service trade? What measures will be taken to promote the recovery of service trade in the future?
Gao Feng: Since the outbreak of COVID-19, the CPC Central Committee and the State Council have issued a series of policies and measures to keep the development of service trade stable and achieved positive results. In 2020, the decrease in China's service trade is lower than those of the world's major service traders, and the decline in growth rate narrows with every passing quarter. Since the beginning of this year, China's service trade has generally continued to stabilize and improve. In the first quarter, the total import and export of services was RMB1,158.19 billion, an increase of 0.5%. Among them, the import and export of services increased by 7.9% in March, which is the first positive monthly growth of service import and export since 2020.
At present, the new technological revolution led by digital technology has injected new impetus into the innovative development of service trade. With the effective implementation of various policies to keep the development of service trade stable and the continuous optimization of the business environment for service trade, it is expected that China's service trade will keep the good momentum throughout the year. At the same time, we also see that the current international trend on COVID-19 is still uncertain, the cross-border flow of people is still limited, the international competition in service trade is intensifying, and the development of China's service trade still faces many uncertain and unstable factors.
The Ministry of Commerce will, in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, closely focus on fostering a new development pattern, develop service trade with innovations, continue to strengthen comprehensive reform and exploration, help the 122 reform measures of comprehensively deepening the pilot program on innovation and development of service trade take effect as soon as possible, study facilitation measures to promote the cross-border flow of service factors, reform and improve the technology trade administration system, expand the opening of key areas in an orderly manner, promote institutional opening-up, vigorously develop digital trade, accelerate the transformation and upgrading of service outsourcing, promote the export of services with distinctive advantages and promote the high-quality development of service trade. Thank you.
CNBC: I have two questions. The first question, USTR Katherine Tai said last week that she was expecting to meet with Chinese trade officials soon to review the implementation of the Phase One deal. What’s the response of MOFCOM? Have the two sides discussed the timing of a possible trade talk? Is there any possibility to remove the tariffs? The second question, Wall Street Journal reported lately that the Chines government is considering replacing the principal for the comprehensive economic dialogue with the US. Could you confirm it?
Gao Feng: Regarding the first question, China has taken note of the news. We will timely release the further developments should there be any. China’s position on tariffs has been clear, that unilateral imposition of tariff does not serve China, nor the US, or the whole world. China-US trade and economic relations are in essence mutually beneficial. The two sides should address the legitimate concerns of each other through dialogue and consultation on the basis of mutual respect and equal treatment.
As for the second question, it’s not true. Thank you.
International Business Herald: Hainan is at the interface of domestic and international circulation. What measures will MOFCOM take to boost new types of consumption in Hainan?
Gao Feng: The successful first China International Consumer Products Expo has yielded rich results, highlighted by new forms and models of business. Following the decisions and plans of the CPC Central Committee and the State Council, MOFCOM will resolutely implement the strategy to boost domestic consumption and support Hainan in fostering new types of consumption and contributing to the new development paradigm.
We will focus on the following aspects: first, give better play to the leading role of the China International Consumer Products Expo. We will summarize the experience of the CICPE, improve planning, coordination, and working mechanisms, and make the CICPE more distinctive and successful. Second, we will support Hainan in leveraging the favorable policies for the free trade port, accelerate the development of modern service industry, optimize the supply structure, to meet different levels and types of consumption. Third, we will support Hainan in developing new forms and models of business, implementing the duty-free shopping policy, and develop the “first-store economy and “product debut economy”, building smart communities and business complex, encouraging digital and intelligent transformation of traditional commerce and cross-industry integration, and promoting online and offline integration. Fourth, we will support Hainan in conducting consumption promotion in creative ways, with the focus on integration, innovation and benefiting the local people and the host city with the CICPE. We believe the market will be further energized and greater potential will be released from consumption.
MNI: It is reported that US defense department has claimed to the federal court that Xiaomi will be removed from the last administration’s list of businesses linked to the Chinese military. What’s the comment of MOFCOM?
Gao Feng: We have taken note of the report. China believes that lifting sanctions and restrictive measures and stop attacking Chinese companies will serve China, the US, and the whole world. Thank you.
Phoenix TV: We noted that the NDRC has announced the suspension of strategic economic dialogue mechanism with Australia. How will it impact China-Australia trade?
Gao Feng: Recently, the Australian government has imposed unreasonable restrictions on China-Australia trade and economic cooperation and undermined the collaborative projects, which has shattered mutual trust between the two countries and the business confidence in win-win cooperation. The Chinese authorities have no choice but to make a legitimate and necessary response. The onus is fully on the Australian side.
We urge Australia to view China-Australia cooperation in an objective and rational manner, treat Chinese businesses fairly and equally, stop disrupting the trade and economic cooperation, and take actions to move China-Australia relations on a healthy path. Thank you.
Global Times: We’ve noted that China-Russia trade has grown fast since the beginning of this year and exceeded USD40 billion for the January-April period. How would you comment on this? What is the expectation for the bilateral trade of the whole year? What measures will MOFCOM take to promote China-Russia trade and economic cooperation?
Since the beginning of this year, China and Russia have worked together to tackle the challenges of COVID-19 and put the bilateral trade back to the track of growth. Our bilateral trade bears the following features:
First, the trade value has hit a historic high. According to China’s statistics, China-Russia bilateral trade was up by 19.8% year-on-year to USD 40.21 billion from January to April, which is the first time ever in history that it took only four months to hit USD 40 billion. The trade value was 21.2% higher than the same period of 2019 and doubled what it was 5 years ago in 2016. Second, importation from Russia has resumed growth. From January to April, China’s imports from Russia grew by 7.7%, turning to a positive growth for the first time since last May and offering vital support for the growth of bilateral trade. Third, the trade structure has improved. In the first quarter of 2021, the imports and exports of electrical and mechanical products and high and new tech products between the two countries both grew by over 50%, much higher than the rise of bilateral trade of the same period.
In addition, Chinese investment in Russia and contracted projects continue to grow. In the first quarter of this year, China’s non-FDI in Russia grew by 9% year-on-year, ranking fourth among China’s major trading partners. The value of newly signed contracts was up by 90.9% year-on-year to USD 630 million, and completed turnover up by 18.6% year-on-year to USD 830 million. Solid progress has been achieved in major strategic projects in such areas as energy, nuclear power, aerospace and aviation and cross-border infrastructure. New strides have been made in local cooperation and scientific and technological cooperation.
Judging from the current situation, China-Russia trade is expected to hold up the growth momentum throughout the year and reach a new high. Moving forward, MOFCOM will keep closely engaged with the Russian side to fully implement the important consensus by our heads of states, deepen cooperation on major strategic projects, expand two-way investment, promote industrial and supply chain integration, and foster new growth points in areas of scientific and technological innovation, bio-medicine, green and low-carbon development. We will move faster to improve and upgrade China-Russia trade and economic relations, and strive toward the bilateral trade target of USD 200 billion. Thank you.
CNR: The third Brand and Quality Online Shopping Festival organized by MOFCOM and other departments was concluded officially yesterday. Could you please brief us on the Festival’s outcomes and the new highlights in terms of consumption promotion?
As part of MOFCOM’s consumption promotion campaign, the third Brand and Quality Online Shopping Festival was launched on April 28 and concluded on May 12. Launching ceremonies were simultaneously held in Beijing and many other places across the country.
According to our monitoring data on key e-commerce platforms, the 15-day event has driven the total online retail sales to RMB 692.8 billion, up by 26.7% year-on-year. To break down, the online retail sales of physical products grew by 25.9% year-on-year to RMB 562 billion. The third Brand and Quality Online Shopping Festival has stood out in the following aspects:
First, domestic quality products led the market. During the Festival, the online retail sales of domestic products accounted for 73.8%. The sales of time-honored brands increased by 33.5%. Among the top 10 best-selling brands that were closely monitored, eight were domestic brands.
Second, quality consumption was mostly favored by consumers. During the Festival, a total of 188,000 brands launched new products, up by 46.8%. There was a strong growth trend in sales of smart, customized, health and other quality products related to consumption upgrade. For instance, sales of germ-free washing machines, customized furniture and smart wearables grew by 117.8%, 95.4% and 67.2% respectively.
Third, online service consumption enjoyed robust recovery. During the Festival, online dining sales increased by 51.1% year-on-year, among which in-store dining grew by two folds. Online tourism sales grew by 3.3 times year-on-year. High-quality travel such as highly customized group tours, family tours and red tours have become increasingly popular.
Fourth, certain foreign products were very sought-after during the Festival. The daily average online retail sales of products made from “Silk Road E-commerce partner countries” grew by 20.9% from March. To break down, chocolate candies from Russia, shoes from Brazil, wine from Chili and clocks, watches and glasses from Italy were up by 192.2%, 131.6%, 85.2%, 46.9% and 45.5% from March respectively.
Fifth, equal attention was given to growth and regulation. During the event, the Ministry of Industry and Information Technology guided producers to innovate their products so as to increase the online supply of quality products; The State Post Bureau guided express delivery companies to ensure proper posting and delivery services; The State Administration of Market Regulation strengthened guidance and supervision on the operations of e-commerce platforms. The China Consumers Association worked actively to collect and handle complaints from consumers. This Festival has achieved a customer satisfaction rate of over 98%. Thank you.
South China Morning Post: U.S. Trade Representative Katherine Tai recently announced that the U.S. government would support for waiving intellectual property protections for Covid-19 vaccines and actively participate in text-based negotiations at the World Trade Organization (WTO). What’s MOFCOM’s position on these issues?
Gao Feng: China was among the first countries to put forward and implement the proposal that Covid-19 vaccines should be a global public good. As WTO members are discussing global vaccine availability, China believes that WTO can play a positive role in this respect. China supports text-based negotiations at the WTO on intellectual property exemption for Covid-19 response supplies including vaccines. In the next step, China will work together with other parties to actively participate in the negotiations for balanced and effective solutions, so that all countries can seize victory in the battle against coronavirus as early as possible.
Market News International: A follow-up question on trade relations with Australia. There have been reports that Chinese authorities have informed two LNG importers of not making purchases from Australia next year. Do you have anything to offer regarding this event or China-Australia trade in general?
Gao Feng: I am not aware of the event you talked about. As for China-Australia trade, I have said that we hope Australia to approach China-Australia in an objective and rational manner, treat Chinese enterprises in a fair and just way, stop the wrong conduct of interfering in bilateral trade and economic relations, and work to promote healthy development of China-Australia relationship. Thank you.
Shanghai Securities News: Seven authorities including MOFCOM and the State Administration of Traditional Chinese Medicine have published a circular on measures to support high-quality development of national traditional Chinese medicine (TCM) export bases. What’s the background of these measures? What are the highlights?
Gao Feng: TCM is a treasure of the Chinese nation. In the fight against Covid-19, TCM has played a unique and crucial role. In 2019, MOFCOM and the State Administration of Traditional Chinese Medicine certified 17 national TCM export bases, including China Academy of Chinese Medical Sciences Guang’anmen Hospital. After nearly two years, the bases are now important platforms to grow TCM services trade and bring TCM to the rest of the world.
Following the instructions of the CPC Central Committee and the State Council, seven authorities including MOFCOM and the State Administration of Traditional Chinese Medicine have published the Circular on Measures to Support High-Quality Development of National TCM Export Bases, in a bid to help TCM go global and benefit more people. The Circular puts forward 18 policy measures in five aspects, namely the following:
First, institutions and mechanisms to boost the vitality of the bases. Qualified bases which are public institutions are supported to pilot international healthcare departments and experiment with innovative operation models by cooperating with private capital through franchising.
Second, integration of supportive policies. Support is given to the bases’ international cooperation initiatives, by various means such as the guiding fund for innovation-driven development of trade in services.
Third, improvements for facilitation. The bases are supported to establish promotional portals for overseas patients, optimize entry and exit procedures for overseas patients and their company, and enhance standards and guidelines for international shipping of TCM.
Fourth, efforts to foster a favorable international environment. Bilateral and multilateral international cooperation, as well as free trade agreements and other mechanisms will help expand the space for international cooperation. The bases are encouraged to engage in outbound investment and technological cooperation to pursue innovation-driven development in such areas as international healthcare insurance and integrated development of business models.
Fifth, talent cultivation and incentives. The bases are encouraged to train professional talents that understand both TCM and foreign languages and optimize talent-related incentives. Thank you.
Gao Feng: Do you have any more question? If not, this is the end of today’s press conference. Thank you.
