Dear friends from the Press,

Welcome to this press conference of the Ministry of Commerce. I am Shen Danyang, spokesman of the Ministry. I am very glad to meet you all again. First I would like to brief you on the commercial performance of China in January and then I will take your questions.

I. China’s domestic market operation

In January, driven by the New Year’s Day and the Spring Festival, China’s market consumption remained to grow rapidly. Sales value of 3,000 retailer’s key monitored by MOFCOM rose 12.7% than that of the same period. Here are the main features of consumption market:

The holiday consumption is nourishing and active. During the New Year’s Day and the Spring Festival, markets were full of supply, various species and outstanding highlights. According to the monitoring of MOFCOM, sales value of key retailer and food and catering enterprises from new year’s eve to January 6 in lunar calendar amounted to 470 billion Yuan, 16.2% higher than that of the Spring Festival last year. Purchases for the New Year, gold, silver and jewelry, fashionable digital products and home-appliances have been in great demand. Cultural consumption, like, visiting temple fair and folk shows has become a popular choice for people. To present a fabulous family dinner in New Year’s eve has been the mainstream of the catering market. The promotions close to the rural markets take on distinct effect, such as, hundreds of thousands villagers go on the way to bazaars.

The sales of gold, silver and jewelry，communication equipment and food stuff increased steadily. Influenced by the increasing consumption, demands for value insured commodities increased. Sales value of gold, silver and jewelry and communication equipment of 3,000 key retailers monitored by MOFCOM was up by 32.1% and 21.3%, 3.5 and 11.5 percentage points faster than that December last year. Sales value of food stuff was up by 22.2%, 4.4 percentage points faster over the last December. Meanwhile, sales value of food stuff and shoes and hats of 3,000 key retailers monitored by MOFCOM was up by 13.3% and 13.8%, 6.8 and 1.0 percentage points lower than that of last December.

The growth rate of sales of home-appliance, automobile and housing-related commodities fell. Sales value of home-appliance, automobile, building and decorating materials of 3,000 key retailers monitored by MOFCOM was down by 10.0%, 4.8% and 5.2% year on year.

The overall prices of edible agricultural products tend to stalk. The CPI was up by 4.5% in January, 0.4 percentage point faster than that of last December. According to the monitoring of MOFCOM, prices of edible agricultural products saw a slight fall after the festival. Last week (February 6-12), the average price of 18 vegetables dropped 4.8% as compared with that of the previous week, of which the prices of cucumber, green pepper and chili pepper dropped by 20.5%, 16.2% and 9.6% respectively. The retail price of eggs dropped by 1.3%, 0.9 percentage point higher than that of the previous week. The price of meat was mainly down, while the retail price of grain and oil maintained a steady growth. The average wholesale price of 8 kind of aquatic products rose by 0.3%.

Currently, China is in the all elated development stage of industrialization and urbanization. The momentum of rapid upgrading of consumption structure has not yet been fundamentally changed and there is still huge potential for consumption. National policies of expanding domestic demand, particularly the expansion of consumer demand will play a further role. Meanwhile, the speeding up reform of income distribution and the social security system will boost the spending of residents. The foundation of China's consumption to maintain a rapid growth is still exits in 2012.

II. Foreign Trade

According to the statistics by the Customs, China’s imports and exports in January registered US$272.6 billion, a year on year decrease of 7.8%. Among that, exports amounted to US$149.94 billion, down by 15.3%; and imports amounted to US$122.66 billion, down by 0.5%. Trade surplus was US$27.28 billion. The statistics was influenced by the seasonal factors for the Spring festival was in January.

First, general trade export grew slightly while proportion of processing trade declined significantly. The imports and exports of China’s general trade in January was US$151.53 billion, down by 5.4% and 2.4 percentage points lower than total value of exports and imports. Among that, exports amounted to US$76.77 billion, up by 2.6%; while imports amounted to US$74.76 billion, down by 12.5%.The imports and exports of China’s processing trade was US$92.76 billion, with a decrease of 9.8%. Among that, exports amounted to US$62.64 billion, down by 4%; imports amounted to US$30.12 billion with a decrease of 19.9%.

Second, trade to some emerging market grows contrarian while exports to EU fell. In January, bilateral trade between China emerging markets and like Russia, Brazil grows. Among that, the total bilateral trade value of China-Russia amounted to US$7.16 billion, with an increase of 26.8%; and that of China-Brazil was US$6.34 billion, up by 5.7%. China’s export to EU was down by 2.3%. Among that exports to Germany and Italy were down by 6.3% and 28.2% respectively. While exports to the U.S. and Japan saw a slight increase of 5.4% and 6.1%.

Third, export growth remained robust in the central and western region but it slowed down in eastern region. In January, exports in the central and western region were up by 17.2% and 19.3%. Among that, exports of Chongqing, Henan, Guizhou and Jiangxi were up by 1.1 and 1.1 times, 19.6% and 23.5%. Exports in ten provinces and cities in the eastern regions were down by 2.5%. Among that, Guangdong, Jiangsu and Shandong were down by 9.2%, 3.9% and 3.2% respectively.

Forth, the overall exports of traditional labor-intense goods grow steadily while imports of raw materials fell. Exports of plastic products, toys and clothing were up by 5.4%, 4% and 3.5%; Export of bags, textile products, shoes and furniture were down by 7%, 6.8%, 1.3% and 2%. The 7 traditional labor-intense goods mentioned-above amounted to 22.4% of China’s total export volume in the same period. Imports of iron ores and concentrates, plastics in primary forms, natural rubber, and unwrought aluminum and aluminum dropped by 13.9%, 26.8%, 8.1% and 4.4%, with a price decline of 11.0%, 3.8%, 24.1% and 12.8%.

Fifth, the exports of private enterprises grew steadily while the growth rate of imports of foreign enterprises slowed down. Export of private enterprises in January was US$75.33 billion with a decrease of 2.8%, while import amounted to US$56.56 billion, down by 21.0% and 3.3 percentage points lower than the total value of imports. Exports of private enterprises were up by 3.2%, 3.7 percentage points higher than that of the total export, while imports were down by 16.7%. Exports of SOEs were down by 1.0%, while imports fell 4.4%.

III. Attracting foreign investment

In January 2012, 1,402 new foreign-invested enterprises established in China, down by 37.49% year on year. The actualized FDI reached US$9.997 billion, down by 0.3% year on year. The main features of foreign capital utilization in January are as follows:

The actualized FDI in agriculture, forestry, animal husbandry, and fishery sectors grew faster than others. In January, the actual FDI in agriculture, forestry, animal husbandry, and fishery sectors amounted to US$197 million, up by 40.14% year on year, 0.56 percentage points higher than the total national amount over the same period of last year. Among that, the actualized FDI in agriculture and animal husbandry sectors grew comparatively faster, standing at 191.37% and 72.95% respectively. The actualized FDI in manufacturing sector registered US$4.698 billion, down by 0.04% year on year, taking up 47% of the total national amount over the same period; the actualized FDI in service sector reached US$4.471 billion, down by 4.62% year on year, over 4.32 percentage points down of the national average, accounting for 44.72% of the total national amount over the same period.

Asia continued to be the major source of foreign investment in China. In January, the actualized investment from ten countries/regions in Asia (Hong Kong, Macao, Taiwan, Japan, the Philippines, Thailand, Malaysia, Singapore, Indonesia and South Korea) totaled US$8.586 billion, up by 0.77% year on year; the actual FDI from the US reached US$342 million, up by 29.05% year on year; the actual FDI from the EU 27 countries amounted to US$452 million, down by 42.49% year on year.

The actualized FDI in the central and western regions was faster than that in eastern region, taking up an increasing proportion. In January, the actual FDI in eastern region reached US$8.562 billion with a 4.63% year-on-year decrease, accounting for 85.64% of the total national amount. The figures in central region were US$834 million, up by 54.6% year on year, taking up 8.35% of the total amount; in western region, US$601 million, up 17.83% year on year, accounting for 6.01% of the total amount.

IV. Outward investment and economic cooperation

Outward direct investment. In January 2012, domestic Chinese investors had directly invested in 355 overseas companies in 87 countries and regions, and their investments in non-financial sectors reached US$4.376 billion, up by 59.9% year on year.

Foreign contracted projects. This January, the accomplished turnover of China’s foreign contracted projects reached US$5.87 billion, up by 38.4% year on year; and the value of newly signed contracts registered US$9.33 billion, down by 10.2% year on year. The newly signed projects with contract value over US$50 million numbered 32, amounting to US$7.07 billion, accounting for 75.8% of the total value of new contracts. Among that, projects with contract value over one hundred million numbered 23, 12 more over the same period of last year.

Foreign labor service cooperation. In January 2012, all kinds of labor sent abroad by labor cooperation projects reached 29 thousand, 5 thousand more over the same period last year. Among that, labors sent abroad by contracted projects and labor cooperation projects numbered 14 thousand and 15 thousand respectively. By the end of January, all kinds of overseas labor totaled 811 thousand, 30 thousand less over the same period of last year.

V. Service outsourcing development

Service outsourcing in 2011 developed rapidly. The total value of executed contracts of service outsourcing is US$32.39 billion, up by 63.6% year on year. In breakdown the executed contracts of international (offshore) service outsourcing valued US$23.83 billion, up by 65.0% year on year, 22 percentage points higher over the previous year. China’s service outsourcing industry took a larger share of the international market. In 2011, service outsourcing undertaken by China took up 23.2% of the global market, 6.3 percentage points higher over the last year. The main features are as follows:

Firstly, the US, Europe and Japan etc. were regarded as the major markets for China’s service outsourcing. In 2011, the executed contracts of offshore outsourcing from the US, Europe, Japan and Hong Kong valued US$16.43 billion, accounting for 68.9% of the total value of offshore outsourcing contracts.

Secondly, China’s service outsourcing industry concentrated in eastern region. In 2011, the executed contracts of international (offshore) service outsourcing from Jiangsu, Shanghai, Guangdong, Beijing and Zhejiang valued US$17.78 billion, taking up 74.6% of the total national offshore executed contracts. Throughout China, executed contracts of all provinces and cities in eastern region valued US$20.86 billion, accounting for 87.5% of the total value of national offshore executed contracts. Service outsourcing developed faster in central and western regions, especially for offshore executed contracts with over one time higher than that in eastern region.

Thirdly, Chinese service outsourcing enterprises were mainly medium-sized, which took up 2.9% of the total amount of enterprises nationwide, with 51.2% share of the total offshore executed value. Large enterprises with offshore executed value over US$100 million numbered 22, 7 more over the previous year, accounting for 0.1% share of the total number of enterprises nationwide, with 16.4% share of the total offshore executed value. Thus, those enterprises expanded their scale rapidly.

Fourthly, service outsourcing became an important field for attracting and creating new jobs. In 2011, new employees in service outsourcing industry numbered 854 thousand. Among that, new university graduates (including college graduates) reached 582 thousand, accounting for 68.1% of the total amount. By the end of 2011, the number of service outsourcing enterprises nationwide reached 16,939 with 3.182 million employees in total, including 2.232 million employees with university degree or above, accounting for 70.1% of the total number of employees.

VI. Farm-supermarket connection

Since 2008, Ministry of Commerce, Ministry of Finance, and Ministry of Agriculture have been vigorously promoting the farm-supermarket connection, which now have reaped staged achievements, and in good overall developing trend.

First, coverage of farm-supermarket connection is expanding. By the end of 2011, above-scale chain enterprises that participated in farm-supermarket connection exceeded 800, with over 2 million staff; cooperatives connected with supermarkets surpassed 15.6 thousand, with over 1 million membership. It is learnt that the farm-supermarket connection can cut 10% of operation cost of live and fresh agricultural products for supermarkets, and help increase income by 4000 Yuan for cooperative members.

Second, farm-supermarket connection level has been constantly enhanced. Through years of study and development, the majority of the supermarkets have established a long-term docking mechanism with shared benefits and risks with docking cooperatives, and farm-supermarket docking level has been enhanced significantly. The strength of the enterprises is intensified. The average registered capital of the chain enterprises involving in farm-supermarket connection business approached 100 million Yuan, with chain stores over 50 thousand and overall business area of 46 million square meters. And the hardware facilities such as the cold chain system and distribution centers have been obviously improved. Product quality is enhanced. In order to meet the requirement of supermarkets, more and more professional farmers’ cooperatives established their own inspecting rooms to make strict checks on indicators such as pesticide residues, and at the same time, stepped up to build brands agricultural products self-owned. Roughly estimated, the agricultural brands owned by cooperatives participating in farm-supermarket connection have surpassed 7,000. The connection mechanism has been upgraded. Jiajiayue supermarket of Shandong Province established risk prevention mechanism for farmers; set minimum purchasing prices for 15 categories of vegetables in production base of 50,000 mu successively, helped cooperatives build cold storage by way of becoming a shareholder, and gave guidance for the production and operation of cooperatives. The connected two parties have become a close common-interest community, which promoted the establishment of make-to-order production mechanism for agricultural products.

Third, new modes of farm-supermarket connection are constantly being created. Large-scale chain supermarkets build their own production base for agricultural products. Huiyou Business Chain Development Co. Ltd. of Hebei Province leased land of 2,000 mu, established standard inaction demonstration parks for agricultural products, carried out batch picking and closed management in the whole process, which further decreased loss in circulation and saved circulation cost. Establish new-type and long-term connection platform. Zhejiang Province constructed exhibition centers for renowned, special and quality agricultural products, as the long-term platform for farm-supermarket connection. It overcame the drawbacks of short period and randomness of the past fairs and exhibitions, and helped constant and in-depth implementation of farm-supermarket connection. Explore the way of online matching for selling and purchasing and e-commerce for agricultural products. Shaanxi Province focused on information guidance, established “production sales linkage platform for vegetables in Shaanxi”, organized commerce departments at municipal and county levels to publish timely information on supply & demand and price of local vegetables, so as to carry out online linkage and open online selling channels for vegetables.

In the next step, MOFCOM will upgrade policies of fiscal support with relevant departments, focusing on linking support to farm-supermarket scale, encouraging enterprises to construct facilities such as distribution centers for live and fresh products and concentration and distribution centers in the production bases, continently expanding farm-supermarket connection scale, and increasing the proportion of farm-supermarket connection.

VII. Expo Central China 2012

Central China Investment and Trade Exposition (referred to as “Central China Expo”) is an important measure to implement the Rise of Central China Strategy, and has been held successfully in six provinces of Central China since 2006, and obtains positive result. At present, with its function kept improved, and its function being improved and influence being enhanced, Expo Central China has become an important platform to promote the opening up and development of the central region.

Expo Central China has played an important role in bringing comparative advantages of the central region into has full play, and expanding economic and trade cooperation among the six provinces of Central China and between China and other countries. Expo Central China has accelerated cross-regional flows of such production elements as talent, technology, capital and information, fully demonstrated advantages of the central region in energy, transportation and cost, and attracting a large number of enterprises and industries to transfer their businesses gradually from the coastal area to the central region. Previous six sessions of Expo Central China have attracted about 36.9 thousand overseas visitors, promoting a number of large projects settled in central region. Meanwhile, relevant state ministries (departments) have taken advantages of the platform to sign a series of cooperation agreements with six provinces in Central China, providing strong policy support for the development of the central region.

The 7th Expo Central China will be held in Hunan province on May 18-20, 2012, with the theme of “opening up and rise green development”, it will further play out the advantages of the central region, promote comprehensive matchmaking between the central region and the “two markets and two resources”, so as to promote all-around, coordinated and sustainable economic and social development of the central region. Focusing on such key industries as new energy, new materials, tourism and culture, Expo Central China 2012 will be organized in first-tier city and second-tier cities of Hunan with the model “1+3”, i.e. Changcha, the provincial capital city of Hunan, will be the main venue, and special events will be held respectively in three second-tier cities Zhuzhou, Xiangtan and Zhang Jiajie,.

Now I will take your questions.

First Financial Daily: I have two questions. First, we noticed that both import and export decreased in January, and it might be the worst monthly trade performance since the financial crisis, what is the specific reason? Will it become a turning point or a trend? What’s your comment on trade momentum for the first quarter and for the whole year of 2012? It is said that Minister Chen Deming will work on policy measures to stabilize foreign trade growth, is there any measure released? The second question, we learned that the Working Group of the Ministry of Commerce to Libya have returned on February 8, 2012, what is the specific amount for China’s investment losses in Libya? And which enterprises suffered big losses? While progress has been made in negotiations with the Libya side, is it possible to get back the balance due that the companies concerned about? Does the Chinese government encourage enterprises to return to Libya to complete some of the unfinished projects, or to participate in reconstruction of Libya? Thank you.

Shen Danyang: China Customs has recently released import and export statistics for January 2012, and I’ve also given you a brief just now. Simply from Looking at the statistics, it is true that both import and export decreased which has not seen for many years. And according to our analysis, there are two main factors: First, a holiday effect of the New Year holiday and Spring Festival in January. Second, internal and external environment for foreign trade development become tightened, especially that overseas demand was declined.

Experience shows that there could be some fluctuations in foreign trade for the first quarter due to the Spring Festival. Foreign trade enterprises usually shift efforts to exports before the Spring Festival, and imports usually arrive after the Spring Festival. Moreover, there were only 17 workdays in January 2012, four days less than the same period of 2011, therefore, a year-on-year decline in January 2012 does not indicate the trend. China Customs has made a statistical adjustment according to festival date change, and import and export growth was 6.2% in January, of which the growth of exports and imports was 10.3% and 1.5% respectively. Although both imports and exports saw a certain increase according to statistics after seasonal adjustment, trade growth keeps the trend of decrease from several months before.

As the downward pressure on the global economy is increasing, China’s import and export is facing a tighter external environment, and the economic situation is still tough. Export growth slowed down mainly because of the weak economic growth of China's major trading partners including the U.S., the E.U. and Japan, and with the falling consumer demand and high unemployment rate, demand for imports, especially for consumer products was reduced. For example, the E.U. is the largest export market of China, accounting for nearly 1/6 of China's export market, but China’s export growth to the E.U. was about 6 percentage points lower than its annual average export growth in 2011, and in January 2012, exports to the E.U. continued to decline, down by 3.2%, affecting China’s total exports. Expanding imports is also facing restrictions due to declining domestic and external demand as well as export restrictions from the U.S. and the E.U. Although China’s foreign trade situation is still grim by the statistics, trade statistics of January does not signal the trend for the whole year.

It is not only necessary to aware the difficulties, and attach great importance to it, but also to further strengthen the confidence and determination. MOFCOM and commerce departments in all provinces are currently working on implementing the spirit of the Central Economic Work Conference and the spirit of National Commercial Work Conference, and exploring potentials for the development of foreign trade, and preparations have been made to deal with difficulties and challenges. MOFCOM will further strengthen monitoring of foreign trade, especially monitoring and early warning of exports of competitive products and labor-intensive products, making an in-depth analysis of the problems by industry and product, taking effective measures to help enterprises solve their difficulties, so as to create a favorable conditions for foreign trade development. Meanwhile, it is necessary to guide and help enterprises to take the opportunity to accelerate the transformation of foreign trade development mode, optimize export structure, and inject new energy for the sustainable and sound development of foreign trade.

I would like to remind you also that despite the negative factors as I just mentioned, exports in some regions and provinces maintain fast export growth in January 2012, of which exports in central and western China rose rapidly, and exports in several regions in coastal areas also increased. For example, Fujian is one of the few provinces that maintained a positive growth for both imports and exports, which is contributed by measures adopted by the commerce department of Fujian Province since the second half of 2011 including giving support for the transformation and upgrading of traditional industries. As we know, most of the exports in Quanzhou and Jinjiang are traditional processing trade products and low-end products such as shoes, garments and bags, now transferring into general trade exports of their own products, enhancing technical content and international competitiveness of traditional exports, and maintaining a strong competitiveness.

And you might be interested in whether MOFCOM has taken any policy measures to stabilize exports, the answer is yes. The State Council and MOFCOM has attached great importance to the decreased imports and exports in January 2012, and Minister of Commerce Chen Deming conducted an inspection to Anhui Province last week to listen to the opinions of foreign trade enterprises, and Minister Chen has repeatedly expressed to keep foreign trade policy consistent and stable. Besides, the National Import and Export Work Conference will be held in Jiangxi on 20-21 February, making arrangements to push forward steady growth adjust structures and promote balances. And at present, MOFCOM is working with related departments on specific policy measures to ease financial pressures of enterprises, alleviate enterprises’ burden, facilitate enterprises to deal with trade frictions, improve safeguard mechanism against export credit crisis, and enhance trade facilitation, helping enterprises to tide over difficulties. Meanwhile, MOFCOM will stick to the policy to promote imports, and make efforts to promote balanced trade.

MFOCOM has released some information recently regarding the issue of Libya. On February 4-8, 2012, Director Wang Shenyang from MOFCOM Department of Foreign Investment and Economic Cooperation headed a working group composed by departments of MOFCOM and enterprises including China International Contractors Association and China State Construction Engineering Corporation paid a visit to Libya. It is the first official working group of China visiting Libya since the Libyan revolution broke out in 2011. The Working Group held talks with Libyan officials from Ministry of Housing and Public Works, Ministry of Economy, Libya-China Chamber of Commerce and Benghazi of Libya, and had a frank and in-depth exchange of views on remaining problems regarding the projects contracted by Chinese companies in Libya and China's participation in Libya's post-war reconstruction. The working group also communicated with Sahara Bank on letters of guarantee concerning projects of Chinese companies in Libya. The Libyan side welcomed the visit of the Working Group, expressing that Libya attaches great importance to developing relationship with China, and respects contracts signed with Chinese enterprises. Libya is satisfied with the projects of Chinese enterprises in Libya, and welcomes Chinese enterprises to return to Libya for business, and Chinese enterprises are welcomed to facilitate Libya’s post-war reconstruction, hoping them to seize the opportunity to resume and expand bilateral cooperation. The Libyan side would like to have a frank exchange of views with the Chinese side on the remaining issues concerning projects of Chinese companies in Libya, and joint efforts to overcome the difficulties in bilateral cooperation.

Now it is hard to estimate the time frame for Chinese enterprises to return to Libya and resume projects since the two sides need to further communicate on a series of specific issues including personnel safety, losses and compensation, project payment, financial accounts, visa and customs clearance. According to MOFCOM, Huawei and ZTE still remain in Libya; other companies including China Construction, China Communications Construction Group, Power Construction Corporation of China, China Gezhouba Group and Beijing Construction Engineering Group have sent representatives to Libya recently to negotiate with the owners of Libya on remaining issues and resumption of projects.

Economic Information Daily: China’s utilization of foreign capital saw a year-on-year decrease in January, and has dropped for three consecutive months, what is the trend? How long will the downward trend continue? And utilization of foreign capital in agriculture and animal husbandry maintained fast growth, what is the reason? The second question, WTO has issued a ruling on China’s export restrictions of nine kinds of raw materials; will MOFCOM adjust policies on exports of raw materials? Moreover, some foreign media said that the E.U and the U.S. will make appeal on China’s rare earth exports; do you have any comments on this? Thank you.

Shen Danyang: Actual utilization of foreign capital dropped slightly in January, down by 0.3% year-on-year, and further researches need to be conducted to find out the reason.

As I just mentioned, foreign trade declined on holiday effect, and utilization of foreign capital was also affected. Despite the declining figures, there are still some highlights, For example, although not a big increase, investment from Asian countries continued to grow, up by 0.77%.And the actual input of foreign capital by the U.S., including large project funding, was up by 29.05% year-on-year. In addition, actual utilization of foreign capital in central and western China maintained a rapid growth, rose by 54.6% and 17.83% respectively.

China's utilization of foreign capital faces a tough domestic and overseas situation in 2012. Unstable and uncertain factors in global economic growth are increasing, with slowing down pace of global industrial restructuring, and weak growth of the world's total direct investment. In China, there are multiple pressures including weak overseas demands, financing difficulties in some enterprises, labor disputes in some areas as well as rising cost of business operation, with increasing pressures on stabilizing trade scale and restructuring of foreign direct investment.

However, China still has the comprehensive advantages in attracting foreign investment. In recent years, China's economy is developing steadily and rapidly, domestic consumption market is expanding, and policy and legal environment is improving, which have formed the long-term and comprehensive advantages for China in attracting foreign investment. Markets have become the paramount deciding factor for transnational corporations to invest in China. During the 12th Year-Plan period, China will accelerate the process of industrialization, informatization, and urbanization, which will provide more opportunities for foreign investors. The survey by American Chamber of Commerce in China, European Union Chamber of Commerce in China and Japan External Trade Organization issued in 2011 showed that, the proportion of enterprises that intend to expand investment in China in these years is high.

As to the raw material issue, we have noticed the WTO ruling on the appeal made by the US and the EU against China’s export restriction of raw materials. The Chinese government always values rules and keeps to commitments. We will seriously evaluate the WTO ruling, and make scientific management to resources products according to WTO rules. What needs to be pointed out is that, it is a commonly concerned issue how to make scientific and effective management to resources products for the international community, and WTO rules allow the membership to achieve policy goal of protecting resources and the environment by adopting necessary measures. In order to cope with global climate change, better protect the environment and resources, over the past few years, the Chinese government has strengthened and perfected the management of part of resources products, especially "high-pollution, high-energy consumption and resource-dependent" products, including the management of rare earth. The relevant policy of the Chinese side is reasonable, which is not designed to restrict free trade or protect domestic industries by twisting trade modes.

Xinhua News Agency: I have two questions about domestic trade issue. According to statistics, China's consumption growth is decreasing. Commerce Minister Chen Deming proposed to research economic policies to boost consumption at the commercial work conference. I would like to ask what the process is now. The second question is that several departments are carrying out special action to crack down illegal pig slaughtering nationwide, and I would like to ask what the current situation of illegal slaughtering in our country and if the special action has a quantitative goal. Last year, the Head of relevant departments under MOFCOM mentioned to cut half of the unqualified slaughtering enterprises in the future two or three years, and could you brief on the progress of the special action. Thank you.

Shen Danyang: As to new policy measures for boosting consumption, I have talked about it at the conference a couple of months ago. To expand consumption is a complex project, involving many aspects, which can not be solved by only the strength of MOFCOM. Considering the decreasing momentum of consumption growth rate, MOFCOM is researching new promotion measures with relevant departments. And the focus is to combine economic structural adjustment, sustainable development and people's livelihood development, including the follow-up measures for Home Appliance Replacement Program. I will brief you as soon as there is any progress.

I will talk about the nationwide special rectification action to crack down illegal slaughtering and strengthen meat safety. Since last October, MOFCOM led the special action, which has made positive progress. In the initial period, we made inspections and punishment. In this period, local departments focused on one-by-one inspection over meat production and operation entities for breeding, purchasing and transporting for sale, slaughtering, meat processing, selling, catering, and collective canteens. According to statistics, by the end of January, over 660 thousand production and operation entities were inspected, and 4,300 clues were found. Local departments addressed problems arising from the inspection, dealt with 6,816 cases of illegal pig slaughtering, transferred 126 cases to justice departments, and seized 660 thousand kilograms of meat from illegal slaughtering.

Currently, the special action has entered the concentrated rectification period. Before the Spring Festival, MOFCOM and other five departments including Ministry of Public Security and Ministry of Agriculture held a national video conference, made arrangement for meat safety during the concentrated rectification period and the Spring Festival period, which prevented meat safety incidents during the Spring Festival nationwide. In the next step, we will intensify rectification with Ministry of Public Security, Ministry of Agriculture and State Administration of Industry and Commerce against major entities in major regions and during major periods, so as to firmly close down unlicensed slaughtering sites and other illegal ones to realize the expecting objective.

You just asked about whether there is a quantitative goal of closing down designated pig slaughtering plants. At the same time of the special action, we also carried out checking up of qualification of designated pig slaughtering plants. It aims to check up on all the designated pig slaughtering enterprises according to laws and standards, and those that did not meet the requirement will be deprived of the slaughtering qualification. We did not set the quantitative goal, and all the unqualified ones will be closed down.

China Consumer News: Last October, the Ministry of Commerce, the Ministry of Finance, and the People’s Bank of China jointly issued Opinions on Making Efforts to Accomplish the Work of Expanding Consumption during the 12th Five-Year Plan, stipulating that measures should be adopted to make consumption more convenient. At present, local commerce departments nationwide are working on convenient consumer spending. I would like to ask what progress has been made in this aspect. What does MOFCOM plan to do in the next step?

Shen Danyang: We talked about consumption at almost every press conference recently. Over the past several years, MOFCOM and local commerce departments have made great efforts to facilitate consumption and favorable results have been made. The measures have brought convenience provided to people, expanded consumption and boosted employment.

Over the past few years, the roads of some cities are broadened, streets cleaner, however, it has become less convenient for people to buy goods to, have breakfast, to have a hair cut or to park their cars. In view of this inconvenience, local commerce departments have made planning with local departments to improve supports and facilities people in most cities have seen distinct improvement to these problems. For people in remote rural areas, it was inconvenient to consume, and after constructing rural supermarkets through Market Project of Thousands of Villages and Townships we have basically solved the problem. Here is a number, by the end of last year, over 600 thousand farmers’ shops have been constructed or rebuilt, some were new ones, and some were rebuilt from the original ones, covering 75% of the administrative villages. It not only facilitated farmers’ consumption, but also promoted rural consumption upgrading, boosted industrial products to enter rural areas, and boycotted fake and shoddy goods.

In recent years, MOFCOM has also made more efforts in facilitating and stimulating consumption. It is relatively convenient for general goods consumption, but service consumption is still inconvenient in some aspects. Therefore, we have focused service consumption in the following two aspects: one is the building of domestic service system, and the other is breakfast demonstration program.

In view of domestic service system construction, since 2009, one domestic service network center has been set up respectively in 137 key cities above prefecture-level, 300 large-scale domestic service corporations have been fostered in 75 cities, with over 6,000 local service centers, and a batch of domestic service brands have been formed, such as the Sunshine Sisters of Shandong Province, Chuan Sisters in Sichuan Province, and Sisters of Three Gorges in Hubei Province. Another example, “81890” domestic service network center in Ningbo has been praised widely.

In terms of breakfast demonstration program, from 2008 to last year, we have supported the breakfast demonstration program by special funds for four consecutive years, implemented pilot breakfast demonstration program in 54 cities, constructed 95 distribution centers for staple foods processing, set up 18 thousand standardized fixed breakfast stores as supporting service, which can provide quality-assured breakfast for 9 million people, and create jobs for 100 thousand people.

As to stimulating consumption during the 12th Five-Year period, I will give you a briefing on that. By the end of last October, the Ministry of Commerce, the Ministry of Finance, and the People’s Bank of China jointly issued Opinions on the Work Well Done for the Consumption Expansion during the 12th Five-Year Plan, which stipulated that measures should be adopted to make consumption more convenient. The concrete measures are as follows: to improve logistic network in rural areas; to develop convenient services in local communities; and to foster new consumption modes. Thank you.

China Daily: Just now I noticed FDI absorption statistics, which showed investment from the US increased rapidly, and that from the EU decreased significantly. I would like to ask for the specific reasons.

Shen Danyang: I have talked about this question at the press conference last month. The reason why it dropped quickly from EU is mainly because of its debt crises and the decreasing and inactive investment. It is largely related to EU’s economic situation. According to the inspection by American Chamber of Commerce, a large portion of American enterprises are confident about the investment in China. The statistics in January showed that American enterprises’ investment in China is increasing rapidly, which is different from that of previous months. The increasing confidence of American enterprises may be one of the factors, and the other one may be specific project, such as, it has something to do with part of funds for the Disney land in Shanghai have been in place in January.

China National Radio: My first question is about the situation of Chinese enterprises and their staff overseas. MOFCOM have issued the “Guidelines on safety Administration of overseas. As for the Chinese workers been attacked in Sudan, this Guidance is tackle such problems. Could you brief us on this Guideline? What other warning mechanisms does MOFCOM have? My second question is about the approval by EU and U.S. on Google’s acquisition of Motorola Mobile. It is said that China’s relevant ministries would make a response to this event next month. Could you provide as with more information on it?

Shen Danyang: Firstly, I’d like to say something about the acquisition. Recently, Anti-Monopoly of MOFCOM has further examine do the case, and the investigation of relevant problems is underway. We will have you informed as soon as possible.

And as for the other question, MOFCOM have issued Chinese-invested Enterprises, Institutions and Their Personnel. I would like to brief you on some details.

In recent years, with the expansion of “going global”, the numbers of Chinese-invested enterprise program and personnel are increasing. By the end of last year, there are 18,000 Chinese enterprises investing overseas, with 1.2 million workers and total asset of more than US$ 1.5 trillion. In the continuous development, we should recognize that the implementation of the strategy of “going global” has entered into a new stage, with both opportunities and challenges. The incidents happened in Libya, Sudan and Egypt had seriously threatened the safety of our enterprises overseas as well as their staff. Even though, we should not be blindly pessimistic or give up simply because of a few setbacks. Therefore, both enterprises and government should have a more mature attitude toward the problems and risks confronted with “going global”, observe with calm and make rational responses.

Chinese-invested Enterprises, Institutions and Their Personnel play a key role to in implementing risk control system the strategy of “going global”. It aims at providing guidance to overseas Chinese enterprises to establish a scientific security and risk management system and to strengthen early management for preventing and controlling risks effectively. The Guidance is focused on the risk of public security of Chinese enterprises overseas as well as management risks. By adopting the international safety management mode to standardize the enterprises’ security management behavior of. Now, enterprises generally reflect that the Guidance has relatively operability and has played an instructing role in strengthening the security of Chinese enterprises and their personnel. Next, MOFCOM will conduct training for security management overseas nationwide, provide supervision and inspection of enterprises’ situation with reference to the Guidance to the building of security risk management systems and safety management system, and make effort to enhance the awareness of risk prevention of Chinese enterprises overseas in a short period of time.

In regard to guiding enterprises to prevent risks, in line with the principle of people-oriented and putting the prevention first, MOFCOM has already built a risk prevention system for “going global” a few years ago. This system concludes four aspects: First, to strengthen basic work. MOFCOM developed and run the statistics system for cooperation of foreign investment, consisting of information of more than 90% Chinese enterprises, projects and personnel. Once problem occur, MOFCOM would be informed as soon as possible, which is effecting for handling overseas incident properly. Second, to establish an early warning system. MOFCOM has worked with relevant ministries to strengthen the monitoring and analysis of the security situation in the hotspots and released warning timely. MOFCOM released 126 warnings last year. Third, to strengthen supervision. As for high-risk countries to build up enterprises and implement projects MOFCOM will carry out safety investigation; especially solicit opinions from embassies and consulates abroad. Meanwhile, MOFCOM ask enterprises to do well assessment of security risks, establish security management system, arrange for necessary security facilities and personnel and strengthen their training, and also buy them personal accident insurance while enterprises are implementing the projects. Forth, to provide public services. MOFCOM will regularly publish guidance on partner countries and regions for Chinese enterprises overseas as well as trade and investment environment report so as to guide Chinese enterprises overseas to prevent risks. And also, MOFCOM will organize security training for staff from Chinese enterprises oversea, sign bilateral investment protection agreements and help Chinese enterprises overseas to solve problems occurred in risks prevention and so on.

Wenweipo: My question is about Sino-US bilateral investment and trade. Currently, Vice President Xi Jinping is visiting U.S. and trade promotion group from MOFCOM has also been there to conduct investment and trade promotion activities. Could you please give us some information on that? Second, as for the newly-opened website “guide to investing in the United States”of Chinese Embassy in the United States, does it mean that Chinese government is further promoting Chinese enterprises to invest abroad? How about the current situation of Sino-US bilateral investments? What’s new?

Shen Danyang: Chinese enterprises investment and development in the U.S. have grown rapidly with expanding scales and fields as well as the various ways, which has already become an important impetus and highlights of developing mutual benefit and win-win of Sino-US economic and trade relations. The newly-opened website “guide to investing in the United States”shows the hope of Chinese government putting forward Chinese enterprises to invest in the U.S., and also become a major measurement taken to provide Chinese enterprises services to invest in the U.S.. In supporting Vice President Xi’s visits to the U.S., trade promotion group organized by MOFCOM and the relevant business associations go to visit the U.S. at the same time. Consisting of 6 branches with 500 entrepreneurs from more than 300 enterprises, the trade promotion group will launch trade investment promotions, project contract negotiations and about 70 activities. The activities Chinese trade promotion group has launched will further strengthen communications and co operations in between, and promote Sino-US relations a sound development.

In regard to other information, activities of Chinese trade promotion group include economic and trade achievement introduction, achievements negotiations and the press conference after all the activities.

As for the Sino-US bilateral trade investment, I’d like to brief you some information. China and the United States is each other's second largest trading partner till now. Bilateral trade volume last year amounted to US＄446.7 billion, 180 times than that of the two countries just established diplomatic relations. China’s imports from U.S. last year surpassed US＄100 billion for the first time, amounted to US＄122.2 billion, up by 20%. China has become the fastest growing export market in the United States for 11consecutive years, and Sino-US trade has strong close complementary advantages. Chinese various consumer goods meet the needs of American consumers, which in one hand expanding the imports of electrical, aviation, biotechnological, pharmaceutical and agricultural products from the U.S., in the other hand in line with China to expand imports for development. At the same time, both sides have already achieved great achievements in investment. Investment projects of American enterprises investing in China totaled 61,000, with contracted foreign investment of US＄162.3 billion and an actual investment of $ 67.6 billion. American enterprises investing in China have achieved great achievement, which has become the profits center of multinational parent company. At present, the United States is still one of China’s largest sources of using foreign investment. However, Chinese enterprises investing in the U.S. are growing fast. Foreign direct investment of Chinese enterprises investing in the U.S. surpassed US＄6 billion by the end of last year, with a wide range of investment. The U.S. is increasingly becoming an important base overseas for Chinese enterprises to invest.

Sino-US economic and trade relations is an important cornerstone of Sino-US relations. We believed that Sino-US bilateral trade and investment will continue to develop steadily and rapidly as long as in accordance with the new position of “mutual respect, benefits and win-win”set by President Hu on his visit to the U.S. in the beginning of 2011, and the package of plans of “China and the U.S. actively to promote trade and investment”proposed by Vice President Xi recently, both sides should handle each other's economic and trade concerns by means of communication rather than a protectionist way, and make efforts to safeguard the basic pattern of mutually beneficial win-win of Sino-US economic and trade relations.

Shen Danyang: That concludes the press conference today. Thank you.



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