Dear friends from the media, Good morning! Welcome to today's Press Conference. I’ m happy to introduce you the commercial performance of January 2014, and take the questions of your concern.

I. Commercial performance in domestic market

In January 2014, domestic consumer market was active with an obvious feature of festival consumption. Purchase and sales of products were both exuberant and the price remained steady as a whole. The main features of consumer market are listed as follows:

1. Consumption of goods for livelihood was vibrant. Among the 5,000 major retail enterprises monitored by the Ministry of Commerce, consumption of food and drink went up by 19.6% and 22.4 respectively on a year-on-year basis, 8.3% and 12.2% higher than that of last month; consumption of clothing grew by 13%, 9.5% higher than that of last month.

2. Consumption demands for cultural leisure increased. Among the 5,000 major retail enterprises monitored by the Ministry of Commerce, sales of sport entertainment articles went up by 13.6%, 8.8% higher than that of last month. Sales of intelligent digital products accelerated, with sales of tablet PC going up by 35.3%, and 3G mobile phone grew by 17.1%.

3. Growth of sales in traditional type of business accelerated. Among the 5,000 major retail enterprises monitored by the Ministry of Commerce, sales of supermarkets and department stores went up by 16.5% and 14.6% respectively, 8.4% and 6.7% higher than that of last month respectively.

4. Consumer prices remained stable. According to the Ministry of Commerce, in 36 medium and large sized cities, price of agro-foodstuff went up by 1.9% on a year-on-year basis in January. Among that, prices of beef, mutton, milk and vegetable respectively lifted by 11.5%, 11.2%, 10.4% and 4.2%; while prices of pork, soya-bean oil and aquatic products went down by 11.3%, 4.5% and 4.1% respectively.

II. Foreign Trade

According to Customs, our total import and export in January 2014 was RMB 2.34 trillion, going up by 7.3% on a year-on-year basis (similarly hereinafter). Among that, exports amounted to RMB1.27 trillion, an increase of7.6%; imports amounted to RMB1.07 trillion, a growth of 7%. Trade surplus was RMB 194.85 billion, an increase of 11%. In USD terms, in January, the total import and export was USD 382.4 billion, going up by 10.3%. Among that, export and import were USD 207.13 billion and USD 175.27 billion, respectively increasing by 10.6% and 10%. Trade surplus was USD 31.86 billion, going up by 14%. The main features of foreign trade in January are listed as follows:

1. Trade with EU, the U.S., ASEAN and Japan maintained good momentum. In January, China-EU, China-U.S., China-ASEAN and China-Japan trade rose by 14.6%, 8.8%, 11.3% and 7.8% respectively. Besides, Mainland-Hong Kong trade decreased by 20.6%.

2. Export and import by eastern China grew steadily, and export by middle and western China grew rapidly. In January, the foreign trade in eastern China increased by 4.8%. Except Guangdong that decreased by 12.3% in imports and exports, Jiangsu, Shanghai, Beijing, Zhejiang, Shandong and Fujian all increased by over 8%. Foreign trade in eastern China and western China went up by 12.8% and 34.6% respectively. Especially in exports, the growth rates of exports of provinces in eastern and western China including Hunan, Jiangxi, Guangxi, Chongqing and Sichuan were respectively 17.1%, 60.4%, 40.9%, 23.9% and 41.2%, all keeping a rapid growth.

3. Growth of general trade was rapid and processing trade saw a year-on-year decrease. In January, import and export by general trade wasRMB1,350.23 billion, going up by 18.4%, accounting for 57.7% of the total volume of export and import in the same period. Import and export by processing trade was RMB 698.57 billion, a decrease of 2.7% or29.9% in proportion.

4. Exports of mechanical and electronic products steadily grew, and those of labor-intensive products enjoyed good momentum. In January, the exports of mechanical and electronic products registered RMB 690.15 billion, going up by 3.8%or 54.5% of China's total exports over the same period. Over the same period, total export of textiles, clothing, bags & suitcases, footwear, toys, furniture and plastic products rose by 12.2% to RMB 295.23 billion, 4.6% higher than the overall growth rate over the same period.

5. Import volume of part of energy and resource products increased while the price decreased. In January, import volumes of iron ores was 86.835 million tons, going up by 33%; the average price of import was RMB 799.8 per ton, going up by 0.2%; import volume of coal was 35.909 million tons, increasing by 17.5%; the average price of import was RMB 507.2 per ton, going down by 13.1%; import volume of crude oil was 281.55 million tons, growing by 11.9%; the average price of import went down by 2.6% to RMB 4870.2 per ton; import volume of refined oil was 3.762 million tons, going down by 3.8%; the average price of import was RMB 4877.6 per ton, increasing up by 0.7%; besides, import of mechanical and electronic products was RMB 413.01 billion, going down by 3.2%.

III. Foreign Investment

In January 2014, 1,719 foreign-funded enterprises were newly approved, decreasing by 8.71% on a year-on-year basis; realized FDI reached USD10.763 billion (equivalent to RMB 66.416 billion), going up by 16.11% on a year-on-year basis with an exclusive of data of bank, security and insurance. The main features of foreign investment in January are listed as follows:

1. Utilized FDI in service sector maintained growing. In January 2014, utilized FDI in service sector registered USD6.33 billion, increasing by 57.02% on a year-on-year basis, or 58.8% of the national total. Among that, utilized FDI in distribution services amounted to USD 768 million, going up by 7.38%. Utilized FDI in agriculture, forestry, animal husbandry and fishery amounted to USD 128 million, going down by 4.62% year-on-year, or 1.18% of the national total. Utilized FDI in manufacturing sector was USD3.466 billion, going down by 21.69% on a year-on-year basis, or 32.2% of the national total, of which utilized FDI in electronic equipment manufacturing like communication equipment and computer amounted to USD 551 million, going up by 9.19%; FDI in chemical raw materials and chemicals manufacturing was USD 239 million and that in transportation equipment was USD 220 million, going down by 56.9% and 62.1% respectively.

2. FDI by ten countries/regions in Asia, and the U.S. in China grew fast comparatively. In January 2014, utilized FDI from ten countries/regions in Asia (Hong Kong, Macao, Taiwan region, Japan, the Philippines, Thailand, Malaysia, Singapore, Indonesia and ROK) amounted to USD 9.548 billion, going up by 22.16% on a year-on-year basis; among that, utilized FDI from Hong Kong reached USD 7.861 billion, going up by 37.69% on a year-on-year basis; that from ROK was USD261 million, increasing by 197.92% on a year-on-year basis. Utilized FDI from the U.S. amounted to USD 369 million, growing by 34.9% on a year-on-year basis, and that from 28 EU countries reached USD482 million, going down by 41.25% on a year-on-year basis.

3. Utilized FDI in central and western China enjoyed a rapid growth. In January 2014, utilized FDI in eastern China was USD8.21 billion, going up by 4.36% on a year-on-year basis; utilized FDI in central China was USD1.565 billion, growing by 89.07% on a year on year basis and utilized FDI in western China was USD989 million, increasing by 71.73% on a year on year basis.

In January 2014, absorbed FDI in eastern China, central China and western China accounted for 76.27%, 14.54% and 9.19% of the national total respectively. Compared with that in 2013, central China got a growth of 6.48% and western China, a growth of 2.85%, taking up a higher percentage of the national total.

IV. China’s investment and economic cooperation overseas

Direct investment overseas. In January 2014, Chinese investors made direct investment in 865 overseas companies in 128 countries and regions, and total direct investment in non-financial sectors accumulatively reached USD 7.23 billion (RMB44.13 billion), going up by 47.2% on a year-on-year basis. As at the end of January, the total direct investment in non-financial sectors reached USD532.9 billion (RMB3253 Billion).

In January, Chinese investment in seven economies of Hong Kong, China, ASEAN, EU, Australia, the U.S., Russia and Japan reached USD 4.58 billion, taking up 63.3% of China’s total overseas direct investments over the same period of time, or decrease of 10% on a year-on-year basis. Investment in Japan and Russia saw a double growth, soaring by 500% and 281.8% respectively; investment in Hong Kong, China and the U.S. rose by 53.3% and 14% respectively; while investment in EU, ASEAN and Australia fell by 37.8%, 32% and 24.2% respectively.

In January 2014, Chinese direct investment overseas by enterprises reached USD3.94 billion, growing by 70.8% on a year-on-year basis, or 54.5% of the national total. Beijing, Shandong, Guangdong and Shanghai took the lead.

Contracted projects overseas. In January, the turnover of China’s contracted projects overseas amounted to USD 7.55 billion (equivalent to RMB46.09 billion), going up by 11.6% on a year-on-year basis, and value of newly-signed contracts was USD 13.93 billion (equivalent to RMB85.03 billion), increasing by 4.5% on a year-on-year basis. The projects each with a contract value above USD50 million were 41 (57 in the same period of 2013), involving a total value of USD 11.84 billion, accounting for 85% of the total value of newly-signed contracts. Among that, the projects each with a contract value above USD100 million were 24, six less than that of the same period of 2013.

As at the end of January, the contract value of China’s contracted projects overseas totaled USD1183.7 billion, with a turnover of USD800.3 billion.

Foreign labor cooperation. In January 2014, labor service personnel dispatched overseas by China reached 31,000, an increase of almost 2,000 over the same period of 2013. Among that, labor service personnel sent abroad for contracted projects were 12,000 and that for labor cooperation projects were 19,000. As at the end of January, all labor service personnel dispatched overseas were 883,000, 64,000 more than that of 2013. As at the end of January, labor service personnel dispatched overseas for labor service cooperation totaled 6.95 million.

That's all for the briefing. Now I will take your questions.

Phoenix Satellite TV: We would like to ask about CPI data. We found that January’s CPI data were rather weak. People fear that together with PPI, they indicate a not-so-good beginning of the Chinese economy this year. How do you view these data? On foreign trade, January was not bad. What is your comment on such a start on foreign trade this year? Can you share some thoughts about the trend of the whole year? Thank you.

Shen Danyang: On CPI, you should consult with the National Bureau of Statistics and other related departments for details. I have nothing more to share here. As regards domestic consumption this year, you may tell from the statistics I just shared with you that overall the trend has been steady. There has been no particular fluctuation compared with that of last year.

Speaking of foreign trade at the outset of the year, export did grow rather rapidly last January. Many people have analyzed this growth. Some wondered if the growth exceeded expectations. In actual fact, we believe it was within our expectation. The reason for this rapid growth was threefold. First, it was driven by economic recovery in developed countries. Since the fourth quarter last year, the economic situations in major developed economies like the US and EU continued to improve, which drove growth in import, leading to a growing external demand for China. Second, China’s policies to stabilize foreign trade continued to pay off. As you know, since the second half of last year, the State Council promulgated a series of policies and measures to promote foreign trade, stabilize growth and readjust the structure. Most of these policies were implemented last year. Some were implemented at the end of last year and early this year. For instance, the Ministry of Finance and the State Administration of Taxation clearly stated recently that cross-border electronic commerce retail exporters would be applied the same VAT, consumption tax and tax refund policies as those for ordinary foreign trade enterprises. Another example is that the AQSIQ issued a circular before the end of last year announcing the extension into 2014 of a fee exemption for enterprises, which was met with welcome from the businesses. Therefore, it is fair to say that the growth in foreign trade last January was a continuation of the steady growth in foreign trade since the second half of last year. Third, the seasonal factor of the Spring Festival was at play. Judging from the situations in previous years, foreign trade figures tend to fluctuate in the first two months of a year due to the influence of the Spring Festival. Last January there were many exporting enterprises rushed to export before the Spring Festival. This rush to export could also be verified by the maritime transport statistics.

On this year’s foreign trade, some analyses hold that the rapid growth was driven by fraudulent export caused by arbitrage. We believe that it was only a guess, and lacked evidence. Even if we cannot rule out that some individual enterprises might have engaged in arbitrage, the export growth in January in general looks reasonable and logical, either in terms of product structure, market structure or in terms of the structure of the exporting entities. We have analyzed the product mix, market structure and regional distribution of export in January.

In terms of export product mix, the growth was mainly driven by the strong growth in the export of traditional labor-intensive consumer goods ranging from light industry daily necessities such as textile, clothing, footwear, suitcases and bags, toys, plastic products, ceramic products, to electromechanical products such as automobiles, auto parts, lamps and color television. So it was not a growth in the export of a few items. Rather, it was a series of products growing, most of which were consumer goods, and traditional labor-intensive goods. For example, clothing grew by 13.4%, textile by 11.7%, footwear by 13.7%, steel by 28.7%, auto parts by 18.9%, plastics by 27.6%, ships by 13.8%, lamps and lighting installations by 52.6%, suitcases and bags by 7%, ceramics by 29.4%, automobile and auto chassis by 15.8%, color television by 50.7%, toys by 16.6%. All these growth rates were based on RMB. The rates would be higher if they were based on US dollars.

In terms of export destinations, exports to the US, EU, ASEAN and most other countries grew simultaneously. Exports to developed regions and emerging countries grew at the same pace. Whereas export to Hong Kong had a negative growth, those to the EU, the US and ASEAN grew by 15.6%, 7.7% and 15.2% respectively.

In terms of province breakdowns, certain provinces experienced rather rapid growth in export in January last year. But this year, the trend was that most of the provinces had a rapid growth in export, especially the central and western ones, which have shown a momentum of rapid export growth.

It is forecast that the growth rate of this year’s foreign trade is likely to be around the same level of last year. Thank you.

China Daily: I would like to ask about the progress on China-EU and China-US bilateral investment treaties, and about any plans for the negotiations this year. Can you brief us on that? I have noted that there was marked increase in China’s investment in Japan. Can you tell us some details about it?

Shen Danyang: From 14 to 15 January this year, the 11th round of China-US Bilateral Investment Treaty negotiations was held in Shanghai. I briefed on this negotiation at last month’s press conference. This round was the first text-based negotiations between the two sides since entering into the stage of substantial negotiations. This was itself a substantial negotiation. To my knowledge, the 12th round of talks will be held in Washington DC early March. Both sides will continue their text-based negotiations. Going forward, the Chinese side will work with the US side in the spirit of friendship, candor and cooperation, and actively take the China-US BIT negotiations forward, with a view to reaching a mutually-beneficial, win-win, and high quality investment agreement. This way we provide our respective investors with a fair, transparent and stable policy framework, whilst at the same time, contributing to the further improvement of global investment rules.

On China-EU bilateral investment agreement negotiations, the two sides announced on 21 November 2013 during the 16th China-EU Leaders’ Meeting the formal launch of the China-EU bilateral investment agreement negotiations. From 21 to 23 January, both sides held a fruitful first round of talks in Beijing. The 2nd round is scheduled to be held in Brussels. The EU side is working on a specific timing for the talks. The Chinese side takes the China-EU bilateral investment agreement negotiations seriously. A bilateral investment agreement will be conducive to creating a stable, transparent, predictable and open environment for investors from the two sides, and to the deepening of the China-EU Comprehensive Strategic Partnership.

On the development in investment in Japan, I would like to explain two points: First, it is difficult to analyze the situation based only on the data from a single month. Second, if there is sharp increase in investment in a single month, very often it is because one or some particular investment projects involving a very large sum of money have occurred.

National Business Daily: I have a question concerning the absorption and utilization of foreign investment. Last month you talked about the utilization of foreign investment last year and last December. Given the statistics we see today, it appears that foreign investment utilized in January rose rather rapidly, and the figure is large. What are the reasons? Are there any specific projects that involved very large sums of money, as you described? Please also share with us your analysis as regards whether or not such a growth momentum in foreign investment will be likely to sustain? Thank you.

Shen Danyang: This year we had a good start with China’s foreign trade, foreign direct investment and outward investment, particularly in January the actualized foreign direct investment reached 10.76 billion US dollars, up by 16.1% year on year, which was a double digit growth. This is the most real and forceful reply to those questioning whether China still possesses a good investment climate, and whether foreign investors are still confident in China’s economic development.

Why there was a rapid rise in foreign direct investment? You asked whether it was because there were certain projects that involved a large sum of money. This is often the case when we are talking about investment surge in a specific country, region and project. But the foreign investment growth in January was an aggregate figure of the entire country. We reckon that there are three reasons: First, the various policies promulgated by the new central government are paying off. The Third Plenum’s overall deployment of the comprehensive deepening of reform hugely boosted the confidence of foreign investors in China. Since last year, the transformation of government functions, the readjustment of the economic structure, and other social and economic reform initiatives promoted by the new government have been taken forward, contributing to expanding opening-up, developing the real economy, driving effective domestic demand, improving the investment climate, and increasing attractiveness to foreign direct investment. The Decision on Issues Concerning Comprehensively Deepening Reforms adopted at the Third Plenum of the 18th CPC Central Committee is an important testimony to and reflection of the determination to uphold the banner. It greatly boosted investors’ confidence in investing long term in China.

Second, China’s comprehensive advantages in attracting foreign investment are gradually emerging. Overall, there is global optimism in investing in China. At present, there is political, economic and social stability in China, an enormous potential in domestic demand, growing competitiveness in human capital, improving industry supporting capacity, and rising clustering effects and synergies. Infrastructure is improving as well. All these represent the comprehensive advantages. Furthermore, since last year governments across the country have paid more attention to improving administrative efficiency, improving investment facilitation measures, and substantially improving the software environment for investment. Consequently, more and more multinational corporations have chosen China as their main investment destination. Therefore, from the statistics of January we can tell that investments from the US, Korea, the Netherlands, Italy, the UK and Hong Kong, among others, have all been growing rapidly.

Third, the growth was driven by the rapid increase in the amount of foreign investment in the services sector. The actualized foreign investment in the services sector rose in January by 57%, marking a very high growth rate. Actualized foreign investment amounted to 6.33 billion US dollars, which was a record high. In January, the investment increment in services accounted for 160% of the total increment in foreign investment across the country. In other sectors such as agriculture and manufacturing, there was negative growth. Therefore, it can be said that the growth in overall foreign investment was mainly driven by the growth in investment in services. This is a direct reflection of China’s effort to further open its services sector to the outside world. It is also the most direct reason for the rapid growth in foreign direct investment in January.

As China’s comprehensive advantages in utilizing foreign investment continue to increase, and as we have combined the importation of capital, technology and knowledge, we were able to bring in some projects relating to advanced manufacturing, modern services, energy saving and environmental protection and modern agriculture, which are on the high end of the global industry chain. This has been conducive to the adjustment of China’s industrial structure, promoted business competitiveness, and increased the overall efficiency in using foreign investment. Therefore, we expect that the good momentum in attracting foreign investment will be maintained this year. Thank you for your question.

International Business Daily China Cuisine Association reports that last year， China’s catering industry grew by 9% in revenue, the lowest figure in 21 years. High-end restaurants suffered a heavy blow, registering negative growth for the first time in recent years. Baijiu sales also declined. What is MOFCOM’s take on that？What are the prospects of the catering industry? What supporting policies will MOFCOM introduce for the industry?

Shen Danyang Since the introduction of the eight-point regulations by the CPC Central Committee, extravagant dining has been curbed. Some high-end restaurants have reported slumps. This has been going on for some time.

In 2013 restaurants with turnover above a designated level reported RMB 818.1 billion in revenue, down by 1.8% year on year. Consumer spending on catering during the 2014 Spring Festival suggests a remarkable decline in high-end catering as compared to previous years, particularly in terms of booking by organizations.

Despite the drop in the revenue of high-end restaurants and extravagant dining, in the light of promoting sustainable economic and social development, we don’t think that the anti-waste efforts should be seen as a drag on the drive to boost consumption.

On the one hand, waste adjusted, China’s residential spending on catering still posted strong growth. In 2013 the revenue of restaurants nationwide still grew by 9% year on year. Although it’s lower as compared to previous years, a 9% growth is by no means insignificant with the anti-waste factor taken into account. In contrast to the slump of high-end catering, popular dining grew dramatically, suggesting a return to rational spending, which is a good thing.

On the other hand, in the long-run, far from hindering catering spending, to advocate thrift, counter extravagance, steer catering towards popular dining, and spur restaurants to continuously innovate on service model and provide services and products that meet the people’s needs will only boost and promote popular, basic, convenient and green consumption for the catering industry. Thank you.

The Beijing News Does MOFCOM have a master plan or roadmap for China’s FTA this year, in particular for China-ROK FTA, China-Japan-ROK FTA and RCEP? News came out today that Taiwan may join the TPP as soon as next year. How will this bear on China’s overall FTA agenda? Thank you.

Shen Danyang First, about China-ROK FTA, China-Japan-ROK FTA and RCEP, in line with the specific requirements of the Decision of the 3rd Plenary of the 18th CPC Central Committee, this year MOFCOM will accelerate the execution of the FTA strategy based on China’s neighborhood and lay the ground work for a global-oriented high-standard FTA network through building high-standard and wide-ranging FTAs. This year we have focused on FTA talks with neighboring countries, namely China-ROK FTA, China-Japan-ROK FTA and RCEP.

Regarding China-ROK FTA talks, this year the negotiation will continue to feature substantive talks on specific offers and requests and agreement texts in all areas. China will work with ROK to build on existing consensuses and drive the talks to an early conclusion in a flexible and practical manner.

As regards China-Japan-ROK FTA, three rounds of talks are planned for this year. The three parties will continue to discuss topics related to, among others, trade in goods, trade in services and investment. China looks to work together with Japan and ROK to reach a balanced, mutually beneficial and win-win agreement to benefit the businesses and peoples in all the parties.

As for RCEP talks, so far three rounds have been held. China is now working as coordinator for the six ASEAN FTA partners and co-chairing the talks with the holder of ASEAN Presidency. The 4th round is scheduled to be held from Mar. 31st to Apr. 4th in China. Setting great store by this event, China will play good host and coordinator and push the talks forward in extensive areas to meet the target of concluding the negotiation by the end of 2015.

As for Taiwan’s application to join the TPP, I haven’t heard about it so far and can’t make comments. I will keep you informed on new developments and comments. Thank you.

CCTV News Center Since its establishment, what experience has the Shanghai Pilot Free Trade Zone offered for nationwide roll-out? We’ve noted that recently local governments across China have one after another voiced the wish for building FTZs, which is also included in their government work reports. How will MOFCOM move this forward? One more question, what’s MOFCOM’s response to the feedback of the No.1 inspecting group of the CPC Central Committee?

Shen Danyang Since its launch last September, China (Shanghai) Pilot Free Trade Zone has been running well with initial results. The FTZ has put in place a management model based on pre-establishment national treatment and negative list, is proceeding with business registration system reform, has implemented overseas investment administration reform, launched trade facilitation pilots, actively explored financial innovation, promoted further liberalization of services, and established the mid- and post-event administrative regulation framework.

The Decision of the 3rd Plenary of the 18th CPC Central Committee makes clear that ‘Based on the existing pilot, a few qualified localities will be chosen for developing free trade zones (ports)’. Now certain provinces and municipalities have applied to the State Council for developing free trade zones or ports. MOFCOM will conscientiously live the spirit of the 3rd Plenary, follow the overall deployment of the State Council, research and coordinate actively to move forward the development of free trade zones and ports in an orderly way, based on a good review of the Shanghai FTZ.

As for the other question concerning the feedback of the inspecting group, at the feedback meeting on Feb.15th, Gao Hucheng, Minister and Secretary of the CPC Leadership Group of MOFCOM, cordially and fully took the comments and advice of the inspection group on behalf of MOFCOM CPC Leadership Group, while undertaking to carry out a good self-check and implement the correction. Minister Gao also presented five specific points for implementation on behalf of the MOFCOM CPC Leadership Group. At present, MOFCOM is studying the issues pointed out by the inspecting group one by one, drawing up the correction program that will set goals, tasks and responsibilities with a timetable, to ensure that the feedback of the inspecting group is executed and produces tangible results.

CRI: In a recent list released by the US, China was identified as the largest physical market of counterfeit merchandise, accusing China of being the largest source of counterfeits. We have noticed that the US has initiated a large number of trade disputes against China. How does MOFCOM comment on that? In the import and export data released today, the traditional powerhouse of foreign trade, Guangdong Province, saw a considerable decline. What are the reasons? As Guangdong is a major weathervane, does this signal a weak starting point for trade this year?

Shen Danyang: We have noticed that in the Special 301 Out of Cycle Review of Notorious Markets issued by the USTR on the 10th of February, some Chinese companies and markets continued to be listed as notorious markets. We are strongly concerned with this. In the review, the US used equivocal wording such as “reportedly” and “right holders indicate” with neither substantiated evidence nor adequate analysis. This is irresponsible and unobjective. China maintains the view that the US should present the efforts and progress made by Chinese companies in IPR protection in a comprehensive and objective manner and make fair comments so as not to project unduly negative image of Chinese companies. The inclusion of such language in the report as “the Notorious Markets List does not purport to reflect findings of legal violations, nor does it reflect the general IPR protection and enforcement climate in the country concerned” does not give the US the exemption of responsibility in this regard. The Chinese government has been firmly committed to IPR protection. In recent years in particular, it has stepped up the efforts and improved its mechanisms with notable results, which is widely recognized by the international community and domestic and foreign companies.

In the meantime, Chinese companies and markets have also put in a great deal of efforts to improve IPR protection by, for example, strengthening internal management, awareness and mechanisms. Positive progress has been made in these areas. I want to draw your attention to the fact that China and the US have maintained sound exchanges and communication in this area. At the 24th session of the JCCT held in December 2013, China flagged its concern on the so called notorious market review unilaterally issued by the US. The US committed that it would improve in a number of areas including transparency and exchange and cooperation with the Chinese government and companies. We urge the US to make more comprehensive, objective and fair assessment of Chinese companies＇efforts to create a favorable environment for future cooperation in this area.

On trade friction. From the start of this year, the US has initiated two antidumping and countervailing investigations against China and passed ruling on the review of five trade friction cases involving China. There are many complicated reasons behind the trade frictions that China is part of. As an observation in general, trade friction is a by-product of China becoming the second largest economy and the largest exporter. It is inevitable and complicated and will remain there for a long time to come. Especially since the outbreak of the international financial crisis, the world economy has undergone profound structural adjustments. The competition on systems, rules, markets, technology and resources has become more intense. Due to slow recovery and sluggish market demand, some countries have adopted trade-restrictive measures to protect their domestic businesses. The idea of free trade has diminished and protectionism has gained momentum. On the other hand, China has made substantial progress in its strategy to diversify export markets, which are yet to be balanced. Chinese products have risen in competitiveness. High- and medium-end products and low-end products are competing with those from developed and developing countries in an ever more fierce way.
Some industries and products are highly reliant on the international market. The irregularity of a small number of businesses has rendered them vulnerable to international trade friction.

We need to take a two-pronged approach to and be level-headed in dealing with trade frictions. Last year China’s total export exceeded USD 2.2 trillion while the value of dispute cases was only USD 3.6 billion. So the percentage is not high, as you can calculate for yourself. Some cases may have a serious impact on some industries, businesses and regions, but as a whole, USD 3.6 billion accounts only for a very small proportion of the total of over USD2.2 trillion.

Guangdong province saw negative growth in foreign trade in January. This is very much related to the high base figure of last year. Of course there could still be other reasons and we are still looking into that. Thank you.

CNR: There were quite a number of incidents in China-EU trade relations last year, including the solar panel case and other antidumping and countervailing disputes, but they were all properly resolved. The two sides also launched talks on the investment treaty. But I noticed one figure today that the total investment of 28 EU member countries in China fell by 41.25% in January. What are the reasons behind the fall and what are your expectations on bilateral commercial relations in 2014?

Shen Danyang: With regard to the decline of EU investment in China, I just got the figure yesterday and have asked relevant departments of MOFCOM to provide further analysis, but I am sorry that I cannot give you an accurate analysis today. Is it because that there were major projects in January last year while there is none for January this year? Statistics of one month is not enough to reflect the entire trend, so we need to do more analysis.

Speaking of China-EU trade relations, I can share with you some statistics on trade last year and January this year. In 2013, bilateral trade reached USD 559.1 billion, up by 2.1% year on year, in which China’s export to the EU stood at USD 339 billion, up by 1.1% and import at USD 220.1 billion, up by 3.7%.Despite the limited growth in bilateral trade in 2013, the EU remains China’s largest trade partner and export market. China is the EU’s largest import market and second largest trade partner. In January this year, bilateral trade showed a sound momentum of fast growth, up by 17.7% in US dollar terms. China’s export to the EU reached USD 35.41 billion, up by 18.8% and import reached USD 20.32 billion, up by 16%.

In 2013, the 28 EU member countries made a direct investment of USD 6.52 billion in China, growing by 21.9% year on year. China’s direct investment in the EU reached USD 3.62 billion, up by 6.2%. The EU is China’s 4th largest source of paid-in FDI in cumulative terms. By the end of 2013, the EU had cumulatively invested over USD 90 billion in China and China’s direct investment in the EU also exceeded USD 35 billion.

In recent years, China and the EU have forged closer economic ties and maintained a sound momentum of steady development. Last year, the successful outcome of the solar panel dispute demonstrates that the two sides have the capability and wisdom to manage and contain trade frictions and safeguard the overall interests of cooperation.

2014 is the inaugural year of the new decade of China-EU Comprehensive Strategic Partnership. China attaches great importance to developing commercial relations with the EU and regards the EU as an extremely important partner for trade and investment. We hope the two sides will seize opportunities, implement the China EU 2020 Strategic Agenda for Cooperation, move steadily ahead with negotiations on the investment treaty, strengthen cooperation under the multilateral framework and jointly oppose trade protectionism so as to achieve win-win results in our trade and economic cooperation.

Shen Danyang: This concludes the press release today. Thank you.

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