Welcome to today's press conference. I’m very glad to brief you on China’s commercial performance in January-July of 2014, and take the questions of your concern.

I. Commercial Performance in Domestic Market

In the first seven months of this year, the domestic consumer market remained steady. According to the statistics of the National Bureau of Statistics, total retail sales of consumer goods in January-July reached RMB 14.4974 trillion, up 12.1% year on year, the same as that of the first half year, and 0.7 percentage points slower than that of the same period of last year. In July, the retail sales of consumer goods increased 12.2%, up 10.5% with price factors excluded. Following are the main characteristics of the consumer market in January-July.

1. Information consumption grew rapidly. Among 5,000 major retail enterprises monitored by the Ministry of Commerce, online shopping was up 35.2% in July, 5.3 percentage points higher than that of the first half year. The rapid development of 4G spurred the consumption of related products, and according to the statistics of the National Bureau of Statistics, sales of communication equipments of enterprises above designated size in July was up 24.2% year on year.

2. Consumer demands for services increased. Catering enterprises transformed to popularization, and middle-level catering consumption with brands and features was active. In July, catering revenue was up 9.4%, with that of catering enterprises under designated size up 12.7%. According to statistics, the film tickets revenue in July reached RMB 3.61 billion, up 102% year on year.

3. Housing and automobile consumption was slow but steady. Among 5,000 major retail enterprises monitored by the Ministry of Commerce, sales of household appliances, furniture, building and decoration materials were respectively up 7.9%, 9.9% and 14.2% in July, 0.1, 4.8 and 3.4 percentage points higher than that of the previous month, slow but steady. Automobile consumption picked up after the falling of March, and in July, the sales of automobile enterprises above designated size was up 8.1%, 1.2 percentage points higher than that of the previous month.

4. Rural consumption grew steadily. Driven by the rapid increase of rural residents’ income and the optimization of the rural social security system and commodity circulation system, rural consumption enjoyed a steady growth. In January-July, rural consumption increased 13.2%, exceeding that of towns, which was 12%.

5. Sales of large and medium-sized circulation enterprises slowed down. In January-July, sales of 5,000 major retail enterprises monitored by the Ministry of Commerce was up 6.3% year on year, 2.5 percentage points slower than that of the same period of last year, among which, sales of department stores and supermarkets went up 4.1% and 5.2% respectively, 7.1 and 3 percentage points slower than that of the same period of last year. In January-July, retail sales of consumer goods of enterprises above designated size were up 9.8%, 2.3 percentage points slower than the total.

6. Consumer prices remained steady. According to figures of the National Bureau of Statistics in January-July, CPI was up 2.3% year on year, the same as that of the previous month. According to the Ministry of Commerce, in 36 large and medium-sized cities, prices of agro-foodstuff went up 2.4% year on year in June, 0.2 percentage points slower than that of June. Among that, the prices of vegetables, eggs, milk and fruit went up 6.6%, 7.4%, 9.8% and 20.2% respectively, while prices of pork and soybean oil went down 5% and 3.3% respectively.

II. Foreign Trade

According to Customs figures, China’s total import and export in January-July reached 14.72 trillion yuan, up 0.2% year on year (the same below). Export was 7.82 trillion yuan, up 1.1%, and import 6.9 trillion yuan, down 0.8%. Trade surplus was 924.9 billion yuan, an increase of 18%. In terms of U.S. dollars, total import and export stood at US$2.4 trillion in January-July, up 2%. Export was US$1.28trillion, up 3%, and import US$1.12 trillion, up 1%. Trade surplus was US$150.56 billion, an increase of 20.9%. The main characteristics of foreign trade in July are as follows:

1. Import and export grew rapidly, with a double digit rate of growth in export. In terms of US dollars, China’s import and export in July reached US$ 378.5 billion, up 6.9%, 0.5 percentage points higher than that of June. Among that, export reached US$ 212.9 billion, up 14.5%, hitting a new monthly record and exceeding 10% for the first time since February; and import US$ 165.6 billion, down 1.6%. Trade surplus was US$ 47.3 billion, up 16.8%.

2. Trade with developed markets remained increasing, and trade with Hong Kong grew rapidly. In July, trade with the EU and the U.S. increased 13.5%and10.5%, respectively, 0.1 and 5.7 percentage points higher than that of June; trade with Japan increased 1.3%, 1.9 percentage points slower than that of June. Trade with Hong Kong further increased, with the growth rate up to 11.4% from 5.8% in June. Trade with emerging entities all kept growth, among which, trade with ASEAN, Russia, India and South Africa was up 8.5%, 8%, 9.1% and 15.1% respectively; and trade with Brazil was down 4.8%.

3. Exports of mechanical and electrical products and high-tech products realized a double digit growth. In July, exports of mechanical and electrical products and high-tech products registered US$115.8 billion and US$56.29 billion, up 12.6% and 10.4%, respectively, 7.5 and 7.1 percentage points higher than that of June. The export of textiles, clothing, bags & suitcases, footwear, toys, furniture and plastic products was US$48.36 billion, up 12.1%, 6.4 percentage points lower than that of June.

4. Import of conventional trade decreased and export of processing trade grew rapidly. In July, China’ s import and export of conventional trade totaled US$207.86 billion, up 6.4%, among which, export was up 16.1% but the import down 3.2%. The import and export of processing trade totaled US$118.07 billion, up 7.7%. Among that, the export was up 10.9%, 9.9 percentage points higher than that of June, and the import remained a growth of 2.5%.

5. Exports of private enterprises enjoyed a rapid growth while imports of state-owned enterprises decreased largely. In July, exports of private enterprises realized a growth of 23.7%, 8.1 percentage points higher than that of June, raising the grwoth of the country’s total exports by 9.9 percentage points. Imports by state-owned enterprises went down 7.7%, 5.5 percentage points higher than that of June, declining for three consecutive months.

III. Foreign Investment in China

In January-July, a total of 13,249 foreign-funded enterprises were approved, up 1.6% year on year. Actually utilized FDI reached US$71.14 billion (equivalent to 438.1 billion yuan), down 0.35% year on year (excluding data of banking, securities and insurance). In July, 2,276 foreign-funded enterprises were approved, up 14.03% year on year; and actually utilized foreign capital was US$7.81 billion, down 16.95% year on year. The main characteristics of foreign investment in January-July are as follows:

1. Utilized FDI in the service sector maintained fast growth. In January-July, utilized FDI in the service sector registered US$39.72 billion, up 11.48% year on year, accounting for 56% of the national total, of which, utilized FDI in the distribution service industry and transportation service industry took a larger percentage and reached US$5.23 billion and US$2.59 billion respectively. Utilized FDI in agriculture, forestry, animal husbandry and fishery amounted to US$970 million, down 8.2% year on year, accounting for 1.4% of the national total. Utilized FDI in manufacturing was US$25.2 billion, down 14.26% year on year, accounting for 35.4% of the national total, of which, utilized FDI in electronic equipment manufacturing including telecommunications equipment and computers, transportation equipment manufacturing, chemical raw materials and chemical products manufacturing took a larger percentage and reached US$4.08 billion, US$2.59 billion and US$1.84 billion, down 5.98%, 12.33% and 33.43% respectively.

2. Investment from major countries and regions maintained steady growth. In January-July, actual FDI in the Chinese mainland from top 10 investors (Hong Kong, Taiwan, Singapore, the ROK, Japan, the U.S., Germany, the UK, France and the Netherlands) amounted to US$66.83 billion, accounting for 93.9% of the total, up 1.1% year on year. Investment from the UK and the ROK reached US$720 million and US$2.92 billion, up 61.2% and 34.6% respectively. That from Japan and the U.S. was US$2.83 billion and US$ 1.81 billion, down 45.4% and 17.4% on a year-on-year basis respectively. Meanwhile, actual FDI from 28 EU countries reached US$3.83 billion, down 17.5% year on year and that from ASEAN totaled US$4.18 billion, down 12.7%.

3. Utilized FDI in central China enjoyed rapid growth. In January-July, utilized FDI in eastern China was US$59.01 billion, down 1.1% year on year, utilized FDI in central China was US$7.16 billion, up 17.8% year on year, utilized FDI in western China was US$4.92 billion, down 13.1% year on year, and utilized FDI in China’s central and western regions accounted for 16.99% of the total.

Shen Danyang: IV. China’s Investment and Economic Cooperation Overseas

Direct investmentabroad. In January-July, Chinese investors made direct investment in 3701 businesses in 149 countries and regions. Total non-financial direct investment reached US$52.55 billion (equivalent to RMB322.74 billion), up 4% year on year, which was the first time to realize positive growth and get rid of the influence of major projects since February. In July alone, the non-financial direct investment reached US$9.21 billion (equivalent to RMB56.56 billion), up 84.9% year on year. By the end of July, China’s non-financial direct investment overseas totaled US$578.2 billion (equivalent to RMB3.5511 trillion).

In January-July, the Chinese mainland’s investment in seven majoreconomies, namely Hong Kong, ASEAN, the EU, Australia, the U.S., Russia and Japan, reached US$36.36 billion, taking up 69.4% of the total foreign direct investment during the same period, with the proportion decreasing by 1.3 percentage points. Investment in Hong Kong fell by 21% year on year. Investment in theEU, Russia and Japan increased by 293.1%, 91.1% and 160.9% respectively. Investment in ASEAN was US$2.89 billion, up 9.1% year on year. Investment in the U.S. reached US$2.82 billion, up12.8% year on year. Investment in Australia totaled US$1.91 billion, up 12.3% year on year.

Contracted projects overseas. In January-July, the turnover of China’s contracted projects overseas amounted to US$72.4 billion (equivalent to RMB444.65 billion), up 9.3% year on year. The value of newly-signed contracts was US$88.95 billion (RMB546.3 billion), down 3.5% year on year. The projects each with a contract value of over US$50 million were 335 (38 less than last year’s 373), with a total contract value of US$70.87 billion, taking up 79.7% of the total value of newly-signed contracts. The projects each with a contract value of US$100 million or more were 186, 39 less than that in the same period of last year.

In July, the turnover of China’s contracted projects overseas was US$10.82 billion, up 28.4%% year on year. The value of newly-signed contracts was US$7.91 billion, down 49.5% year on year.

Labor service cooperation overseas. In January-July, labor service personnel dispatched overseas reached 307,000, an increase of 38,000 over the same period of 2013 and up14.1% year on year.. Labor service personnel sent abroad for contracted projects were 148,000, and those for labor cooperation projects were 159,000. In July, all labor service personnel dispatched overseas reached 52,000, an increase of 9,000 over the same period of 2013. By the end of July, all labor service personnel dispatched overseas were 955,000, 68,000 more than that at the end of July 2013.

By the end of July, labor service personnel dispatched overseas amounted to 7.22 million.

Shen Danyang: V. Service Outsourcing

In January-July, service outsourcing in China maintained a steady development. According to statistics from the Ministry of Commerce, in January-July, the contracts on service outsourcing totaled 103,584, with combined contract value of US$59.65 billion, an increase of 34.4% year on year. The value of contracts executed amounted to US$42.62 billion, up 33.9% year on year. The total value of contracts of international offshore service outsourcing reached US$39.19 billion, up 25.6% year on year. The value of contracts executed amounted to US$29.00 billion, up 29.5% year on year.

Information technology outsourcing(ITO)took the lead. In January-June, ITO, knowledge process outsourcing (KPO) and business process outsourcing (BPO) accounted for 52.1%, 33.5% and 14.4% respectively. ITO still took the lead.

Major markets of service outsourcing were the U.S., theEU, China’s Hong Kong, and Japan. In January-July, the executed contract value in service outsourcing from the U.S., the EU, Hong Kong and Japan was US$6.93 billion, US$4.15 billion, US$4billion and US$3billion, respectively, accounting for 23.9%, 14.3%, 13.8%, 10.3% respectively among the total value of contracts executed.

Jobs in service outsourcing increased steadily. In January-July, newly increased employees in the service outsourcing sector reached 453,000. As of the end of July, the number of enterprises in the service outsourcing sector totaled 26,587 with 5,814,000 employees, including 3,876,000 with college education or above, accounting for 66.7% of the total.

Shen Danyang: The above is the infomation I would like to provide to you. Now,, you are welcome to ask any questions.

China Daily: I’d like to ask about FDI. The figures released show that FDI utilization slumped in July. What are the causes? Is it related to the intensive anti-monopoly investigations into foreign-invested companies of late? What is the outlook on FDI for the whole year? What is MOFCOM’s approach to anti-monopoly investigations? The EU Chamber of Commerce has aired its concern over the investigations targeting foreign businesses. What is your take on that? What will MOFCOM do in the investigations? Thank you.

Shen Danyang: The figures I’ve shared with you show that this year up to July, FDI in services maintained rapid growth whereas the manufacturing sector saw a dip. We believe as China steps up its economic restructuring, FDI fluctuations in certain months are normal. They can’t reflect the overall trend, or, still less, be linked to the anti-monopoly probe or justify unfounded associations.

It has to be reemphasized that as the Chinese government builds, improves and perfects the market economy system, market players of all ownership structures are treated equally, and even more so in the future. All market players should operate in compliance with law. Whoever breaches China’s law will be punished and held accountable.

Over thirty years into reform and opening up, foreign-invested enterprises have become part and parcel of the Chinese economy, playing a major role in economic and social development. The majority of foreign investors in China are law-abiding in their investment activities and business operations. It is believed that most of the foreign-invested companies will continue to operate in China in accordance with law. Foreign investors will by no means be frightened away by a few investigations.

We want to reiterate that the Chinese government will continue to welcome foreign investors to do business in China and protect the lawful rights and interests of foreign investors and foreign-invested companies in accordance with law, in an effort to create an open and transparent legal environment, an efficient and convenient administrative climate and a level playing field for players across the ownership spectrum. Moving forward, we will keep tracking the global economy and foreign investment in China, take active measures, continuously upscale opening up, further optimize international investor services, genuinely guarantee the legitimate rights and interests of foreign-invested companies and create more favorable external conditions for the stable growth and in-depth exploration of Sino-foreign investment cooperation. It is foreseeable that with the concerted efforts of the parties concerned, Sino-foreign investment cooperation is sure to have broader prospects.

When it comes to anti-monopoly, MOFCOM is mainly responsible for the review of the concentration of undertakings. We are actively doing our job according to the Anti-monopoly Law and the deployments of the State Council. Thank you for your question.

CBN: We can see that exports soared by 14.5% in Jul. DG Shen, does this indicate a genuine turnaround in China’s foreign trade? What will MOFCOM do moving forward to stabilize growth? There’re also doubts over the authenticity of the 14.5% growth. What’s your view on that? Thank you.

Shen Danyang: First, I want to point out that 14.5% is normal growth. Whenever there are drops or rises in growth, questions are raised. I believe all the views have to be based on evidence. Four reasons contributed to the double digit growth of 14.5% in July based on a preliminary analysis:

First, the growth stabilizing policy for foreign trade continued to work and boosted the confidence of exporters. The confidence of Chinese exporters really matters. For quite some time, there was a confidence deficit among the exporting businesses. Recently, owing to the promulgation of policies and the implementation of supporting measures, among other factors, the confidence of exporters have been restored markedly. Since the introduction of A Few Opinions on Supporting the Stable Growth of Foreign Trade by the General Office of the State Council in May, the departments and localities have worked actively on supporting measures to promote implementation, enhancing trade facilitation, unleashing the vitality of market players and magnifying the policy effect. The brightest spot and most popular element in the document is the wave of trade facilitation measures, which set the policy this time apart from previous incentives. These measures have made a difference.

Second, continuous recovery in the world economy kept buoying the demand in the international market. In July, China’s exports to the four major economies, namely, the EU, the US, Hong Kong and ASEAN, all picked up markedly, by 17.4% for the EU, 12.3% for the US, 13.3% for Hong Kong, and 11.9% for ASEAN. The robust growth in all the four major export markets of China pushed up its export growth rate. Making up nearly 60% of China’s overall export markets, the big four lifted China’s export growth by 8.3 percentage points in July. Besides, processing trade also played a part, which targeted primarily advanced economies and grew by 10.9% in export, the first double digit growth in this year. For quite some time, processing trade grew slowly, even reporting negative growth at times. Since processing trade mainly targets advanced economies, as the demand in the EU, the US and Japan picked up, processing trade also registered double digit growth.

Shen Danyang: The export competitiveness of certain sectors and products perked up. In July, machinery and hi-tech products both posted double digit growth, up by 12.6% and 10.4% year on year respectively, 7.5 and 7.1 percentage points higher as compared to June. A host of products of competitive edge maintained relatively rapid growth, including lighting instruments and color TV sets, which both topped 50% in export growth.

Judging from the circumstances, foreign trade has basically turned around. That said, exports remain constrained by fragile international demand recovery, mounting trade frictions and the lack of new domestic comprehensive competitive advantages. Huge pressure remains to meet the target for the whole year. More hard work is needed.

The media and the business community have registered a broad interest in the considerations of MOFCOM and relevant departments in advancing the stable growth of foreign trade moving forward. We will first and foremost step up the implementation of Document 19 of the General office of the State Council, with focus on two areas. On one hand, we will promote the mechanization of growth stabilizing measures to address the difficulties of exporters on the ground and upscale trade facilitation. Recently, nine departments, including MOFCOM, the NDRC and GACC, have issued a series of supporting policies separately or in concert to help businesses address their problems. For example, MOFCOM has introduced several facilitation measures, including delegating processing trade approval right, scrapping the cost of production for licenses, reducing the value-added services charges for networked processing trade companies, and cutting the fees for participating in the export section of the Canton Fair. The NDRC, MOF, MOFCOM, MOC, GACC and the AQSIQ also jointly issued a circular to straighten out the commercial services and charges for import and export. The AQSIQ has further adjusted the export legal inspection catalogue, whereas GACC has pushed forward large-scale customs-inspection cooperation to enhance trade facilitation. Besides, as of 14th Aug., 17 provinces and municipalities, including Tianjin, Hebei and Guangdong, had officially launched supporting measures to stabilize foreign trade growth. Thus, the central and local governments have combined their forces in policy.

On the other hand, we will continue to take concrete measures to optimize the regional deployment, market players, product mix and trade patterns for foreign trade market structure, speed up the building of foreign trade production bases, trade platforms and international marketing networks, work out policy measures to foster new competitive edges for foreign trade and accelerate the cultivation of new competitive advantages for foreign trade centered on technology, brand, quality and service. Thank you for your question.

China National Radio: On auctions of government vehicles. We know that the first batch of vehicles was auctioned in Zaozhuang, Shangdong Province last month since the launch of the nation-wide reform of government vehicles. Shenzheng and some other cities have also started auctioning off the vehicles. Can you give us an overall picture on that? Almost all levels of government use public auction as the way to implement the reform. How does MOFCOM ensure the openness and efficiency of the process? Thank you.

Shen Danyang: According to data from the national auction information management system of MOFCOM, the number of auctioned official vehicles has seen a notable rise as the reform gained momentum. In the first half of this year, the auction value of government cars grew by 44.3% over the same period last year, totaling RMB 3.57 billion yuan. There was a noticeable growth in government-entrusted car auctions.

In the first half of this year, government-entrusted auctions achieved a turnover of RMB 1.13 billion yuan, 500 million more than the same period last year, registering a growth rate of 79.4%. This additional 500 million is the result of the reform drive in various localities. In fact, since the adoption of the reform policy in Wenzhou, Shanghai and other cities in 2011, auctions of government cars have kept rising. From 2011 to June 2014, government-entrusted auctions reached RMB 4.66 billion yuan. Shanghai, Shandong, Guangdong, Zhejiang and Inner Mongolia saw the largest turnovers with combined worth of RMB 2.02 billion yuan, accounting for 43.3% of all government-entrusted auctions in the past three-plus years.

As supervisor of the auction sector, MOFCOM will, along with other relevant agencies, monitor and guide the auctioning businesses for better quality of services and ensure open, fair and just auctioning processes. We have mapped our three specific tasks moving forward. First, enhance market supervision. Auction companies will be required to strictly abide by relevant laws and regulations and operate in accordance with laws. We will ban companies with no auction qualification from participation that disrupts market order. Second, regulate the business process to ensure quality of services. We will encourage businesses to adopt industrial standards such as the Rules on Vehicles Auctioning, and clearly-defined auctioning processes and operations. Third, improve guidance to businesses. We will encourage to integration of online and physical auctioning, increase transparency and openness of information, and ensure the process is conducted in an open and efficient way.

Die Welt: I want to ask about the anti-monopoly work. The EU Chamber of Commerce has raised concerns with your current anti-monopoly practice, accusing China of unfairly targeting foreign-invested companies. Now that Audi, BWM and Mercedes-Benz have been found of engaging in monopoly activities, when will you start penalizing them and how? Thank you.
Shen Danyang: In fact, I’ve already partially answered your questions. The competent agencies of the Chinese government conduct investigations into suspected monopoly activities to promote fair completion and protect rights of consumers. Many companies, including foreign-invested ones, acknowledge this effort and deem it as beneficial. It is a customary international practice to investigate into monopoly activities. In China, any company, Chinese or foreign, has to face up to legal consequences and punishment if they violate laws.

The Anti-monopoly Law has been enacted for six years. It does not exclusively target foreign-invested companies, as Chinese and foreign companies alike are investigated for monopoly allegations. It treats all companies on an equal basis and does not discriminate against foreign companies.

You asked about auto makers like Audi and Mercedes-Benz. In fact, in the recent anti-monopoly investigations, the auto sector is not the only one targeted; many other foreign-invested companies are also investigated for their violations. It is understandable that the EU Chamber of Commerce and some companies have complaints. However, the investigation of these companies, including those investigated on the ground of food safety, is conducted in accordance with law. On OSI Group’s selling of expired meat, MOFCOM pays close attention to the incident after being informed. We have talked to a number of fast-food companies, urged the companies involved to immediately stop selling tainted meat and cooperate with the regulators in their investigation. To promote the rule-compliance of companies is to establish a sound, fair, transparent and rule-based market order and improve the investment environment. Not the other way around. As to some speculations here and there, or accusations that China is targeting a certain company or country, they are groundless and mere guesswork. Thank you for your question.

Macau Asia Satellite Television: Good morning, Mr. Spokesperson. I want to ask about China’s trade with Russia and MOFCOM’s plan in this area. Russia says, amidst recent western sanctions, it will increase two-way trade with China. China’s Unionpay will possibly replace VISA or other international means of payment to be the new way of payment in Russia. The country will also increase import of agricultural products from China. What is MOFCOM’s take on this? Will China play along with Russia or have other considerations in this regard? Thank you.

Shen Danyang: First, let me stress that China and Russia are comprehensive strategic partners and we are ready to vigorously promote our bilateral commercial relations on the basis of equality and mutual benefit and create enabling conditions for more cooperation on energy, agriculture, infrastructure and high technology. With regard to the agricultural trade you mentioned, China’s export to Russia has seen steady growth in recent years, thanks to the joint efforts of the two sides, reaching USD 2.1 billion in 2013. China’s export of agricultural products is highly market-based. Companies decide for themselves the countries and markets they export to based on commercial conditions and quality requirements. It is a normal business behavior that Chinese companies have increased their export of agricultural products to and investment in Russia. Agricultural trade is an important part of trade between China and Russia. The two countries have unique advantages and potential in agricultural trade as neighbors. Companies in the border provinces and regions have exported agricultural goods to Russia in various forms. China will continue to support businesses from the two countries to enlarge agricultural trade and work together with Russia to facilitate the process. Thank you.

China News Agency: I have two questions. First, recently the WTO General Council failed to adopt the Trade Facilitation Agreement due to India’s refusal to sign on it. What is the Ministry of Commerce’s comment on this? Second question, Zhang Xinzhu, member of the expert advisory group of the Antimonopoly Committee of the State Council, was dismissed, leading to some public controversies. What is MOFCOM’s comment on this? Thank you.

Shen Danyang: On the first question. China finds it regrettable that the General Council of the WTO was unable to adopt the protocol of amendment on the Trade Facilitation Agreement in line with the deadline previously set, and fears that this may have some negative impact on the multilateral trading system and the Doha Round negotiations.
The Trade Facilitation Agreement was the first multilateral trade agreement ever reached since the inception of the WTO 19 years ago. It was by no means easy for the agreement to be reached. China hopes that all parties could bridge their differences and find a solution to the problem.

As a staunch supporter of the multilateral trading system, China already notified the Preparatory Committee of the WTO on the Trade Facilitation Agreement of its category A measures. China calls on all parties to implement the decision of the Bali Ministerial in a comprehensive and balanced manner, uphold the development objectives of the Doha Round, and come up with a balanced and doable work program before the year end, so as to lay the foundation for the complete conclusion of the Doha Round.

As for you second question, the Chinese Academy of Social Sciences dismissed Zhang Xinzhu on 30 July on account of breach of relevant work disciplines under the Work Rules of the Expert Advisory Group of the State Council Anti-monopoly Committee. He no longer serves on the Expert Advisory Group of the State Council Anti-monopoly Committee. Thank you.
International Business Daily: We are interested in China’s assistance to some western African countries including Liberia to help tackle the Ebola epidemic. We are interested to know what measures are to follow. Thank you.

Shen Danyang: We have released several pieces of information on this over the past days and weeks. Recently the Chinese government announced that it would provide 30 million RMB worth of emergency humanitarian in-kind assistance to the western African countries of Liberia, Sierra Leone and Guinea, which have been seriously affected by the Ebola epidemic. This was the second batch of emergency assistance provided by the Chinese government especially for tackling the Ebola epidemic in western African countries since last April. This second batch of in-kind assistance was delivered to the three western African countries a week ago. Nine public health experts from China have also arrived there successively. They will work together with the medical teams of the above-mentioned countries to engage actively in the local anti-Ebola actions. The current batch of emergency assistance was positively received in the three western African countries as well as in the international community.

The Ebola outbreak in related western African countries is a common threat the international community faces in the non-conventional security sphere. The Chinese government will continue to respond actively to the call of the United Nations and the WHO, maintain communication and coordination with the WHO and related countries, and continue to provide assistance to the best of our capacity as the development of the epidemic, the urgency of the situation and the needs of related countries require.

Economy & Nation Weekly of Xinhua News Agency: Revenue for the catering industry rose by 9.4% in July. Does it mean that this industry has stabilized? What are the reasons behind? Does it suggest that China’s transformation of the high-end catering industry is taking some effect? Second question. Just now Mr. Spokesperson mentioned that China’s outward direct investment (ODI) grew by 4% in the first seven months of the year, recording the first positive growth since last February. So what are the reasons? Is this trend likely to continue? Thank you.

Shen Danyang: I will answer your last question first. The positive growth in ODI is normalcy. The negative growth reflected in the statistics of the first half of the year was actually due to some extraordinarily large projects taking place during the same period last year, which led to an overly high base value. It will be a new normalcy for China’s ODI to maintain a relatively rapid growth, and surpass the level of China’s inward FDI in the near future. It is forecast that this year’s ODI is likely to maintain a rapid growth rate of around 10%.

On the second question. Revenue for the catering industry grew at 9.4% last July, against the backdrop where, since the promulgation of the Eight Rules of the CPC Central Committee, consumption using public funds and institutional consumption were being effectively curbed, high-end catering spending was cooling down substantially, and the price and scale of catering sales were dropping markedly. Under such circumstances, the Ministry of Commerce published a series of policy measures including the Guiding Opinions on Accelerating the Development of Popular Catering, and provided guidance for businesses to transform their business mindset and make innovations. Such policy measures actually underline two aspects of guidance work. One is to promote vigorously the transformation of high-end catering businesses; and the other is to encourage popular catering businesses to come up with more marketable products that cater to market demand. It is fair to say that in the first seven months of this year, the performance of catering businesses suggested that efforts to provide guidance in these two aspects have seen positive progress and certain results.

I would like to share with you a group of figures. From January to July, the actualized revenue of the country’s catering industry reached 1,517.6 billion RMB, up by about 10% or 1.2 percentage points year on year; revenue for catering businesses above the designated limit reached 441.5 billion RMB, up by 2.9% or 5.1 percentage points year on year. This suggests that overall the nation’s catering industry is in steady development, and speaks to the fact that the internal driving force for domestic consumption is strengthening, and that the transformation of the high-end catering has taken initial effect while catering consumption is returning to a rational basis.

Based on what we have learnt, high-end catering businesses have explored many transformation approaches ranging from developing popularized catering to innovating popular service models, and introduced many new practices, such as having a restaurant in front and a production site behind, producing instant dishes and increasing the capacity to provide takeout services. Other practices include providing catering services, i.e. dispatching chefs to cook dishes for customers at their homes. When treating their guests with home meals, people can hire chefs from high-end restaurants and cook for them at home, thus making more efficient use of the chefs. Efforts were also made to develop vigorously business types such as business catering, wedding and birthday banquets, family dinner parties, and tour group meals, in order to satisfy diversified needs. When it comes to industry chains, the effort in matching agricultural production with restaurants and in establishing raw materials production bases and sourcing bases has not only lowered purchasing costs but also guaranteed food safety. The industrialization of food processing (for example I learnt recently that machines can be employed to cook dishes, especially in large canteens. Over 1,000 people dine at the canteen in my ministry. How do we cook the food for so many people? We can use machines.) and standardization of product production can help improve efficiency and profitability. Strengthening delivery capabilities and distributing food and beverage products to the chain stores of companies, convenient stores and supermarkets helps expand sales. Thank you for your question.

CRI: In the first half of this year, China’s services export grew faster than services import. Was it just a coincidence or inevitability? It is likely that trade in services will maintain high growth this year? Second question, MOFCOM’s website on 11 August quoted from the Russia-24 news that Gennady Sakharov, director for capital investments of Rosatom, said his company was researching a Chinese proposal to build two nuclear power facilities in Harbin, and that it was planning to send experts to investigate in China soon. This information was denied by the Heilongjiang Provincial Development and Reform Commission. So what is the exact situation? Thank you.

Shen Danyang: First to your last question. To our knowledge, the Russian side has not raised relevant cooperation proposals to us so far.

On trade in services, China’s total import and export of services in the first half of this year was valued at US284.72 billion dollars, up by 15.3% year on year. In breakdown, export was valued at US113.17 billion dollars, up by 18.2%; while import US171.55 billion dollars, up by 13.6%. For the first time the growth rate of services export exceeded that of services import, which was a new highlight in China’s foreign trade development. We hope this would become a trend. However, based on the current situation, even though China’s services export has shown some good growth momentum, it is still too early to conclude that services export outpacing services import will become a new trend. Last year, the added value of the services industry in China accounted for 46.1% of gross domestic product, surpassing manufacturing industry for the first time to become the biggest industry. In the first half of this year, the added value of the services industry rose by 8% year on year, around 0.6 percentage points higher than the growth rate of gross domestic product. This suggests that China has entered into a stage where services and trade in services develop rapidly. Since the second half of last year, the State Council has promulgated successively a number of Opinions to speed up the development of health service, pension service, to promote external cultural trade, culture and creative business, and designing services, and to accelerate the development of producer services and modern insurance service. The introduction of these Opinions will further consolidate the foundation of developing the domestic services industry, and elevate the international competitiveness of China’s services sectors. The policy effect of these Opinions will gradually manifest itself in the coming months and years. It is expected that in the second half of the year China’s trade in services will maintain steady and rapid growth, with both services import and services export registering double-digit growth. We forecast that the total value of services import and export of the year may exceed US600 billion dollars. Thank you.

21st Century Business Herald: I have two questions: First, it was recently reported in the media that some well-known e-commerce vendors had been found selling counterfeit brand-name clothing, watches and so on. How does MOFCOM plan to further regulate and manage e-commerce and stem the selling of shoddy and counterfeit goods? Second, on the use of FDI. Could you please sum up the trend of FDI growth in the first seven months, and forecast the FDI development trajectory in the coming months? Thank you.

Shen Danyang: I will answer you first question first. In recent years, e-commerce in China has developed rapidly. Annual trading volume has already exceeded 10 trillion RMB; while annual growth rate has exceeded 30%. With 1.85 trillion RMB of online retail sales, China is now the number one country in the world in terms of online retail. Meanwhile, IPR infringement and the selling of counterfeit and shoddy goods in the domain of e-commerce have also been on the rise and appearing in varying manifestations. They share the feature of being virtual and intelligent.

In response to such a situation, the National Leading Group for Combating IPR Infringement and Counterfeits has identified infringement and counterfeiting activities on the Internet as a priority for its special crackdown actions, and has launched since the beginning of the second half of this year a half-year long special campaign. This special campaign focuses on four major areas: 1. Focus on key products and problems that have raised concern both at home and abroad. 2. Strengthen enforcement coordination among agencies and regions, and form a concerted effort. 3. Dig deep into the source of counterfeiting. 4. Be resolute to investigate a number of typical cases, shut down a number of illegal websites, and remove a number of counterfeiting sites. On top of the special campaign, efforts are to be made to understand clearly the characteristics of Internet-based infringement and counterfeiting, research and formulate effective regulatory measures and solutions, and substantially safeguard the lawful rights and interests of consumers.

On FDI, just now I talked to you about some facts and policies relating to FDI utilization. A few phenomena concerning FDI may evolve into some future trend: First, the size of FDI will remain steady. Second, the quality of FDI utilization will be further improved. It is the direction of our efforts to optimize the quality, level and structure of FDI. In terms of structure, the share of the services industry will continue to outgrow manufacturing, and experience further increase. High and new technology and some key manufacturing sectors that are encouraged will experience development. Third, the share of the central regions in using FDI will continue to rise. Currently, the pace of FDI utilization in the coastal regions is slowing down. However, utilization of FDI in the central regions is on the rise both in terms of scale and growth rate. This will become a trend. It is forecast that FDI utilization for the whole year is likely to be on par with last year’s level. Thank you.

Shen Danyang: With that I conclude today’s press conference. Thank you all.