On May 25, the Ministry of Commerce held its regular press conference. Spokesman Sun Jiwen answered the hot issues that concern media at home and abroad. Here is the record:

I. Research Report on China-US Economic and Trade Relations

Research Report on China-US Economic and Trade Relations was officially released by MOFCOM today, and the full text has been noticed on the website of MOFCOM. In early April, the successful Mar-a-Lago meeting between two Heads of State indicated the direction for bilateral trade and economic relations development in the new period of time. Recently, the two sides made “early harvests” through close negotiations during the “first 100 days plan”, which will bring real benefits to business and people of both sides. It’s been proved once again that cooperation is the unique and right choice for US and China. As we all know the US and China are the largest economies in the world with an economic aggregate of 40% of the world, taking up one fourth of the world goods exports, 30% of the world outward investment and assimilation of foreign investment respectively. As the largest developing country and the largest developed countries, China-US trade and economic relations not only affect the economic development of both sides, but also has great impact on global trade and investment growth and world economic trend. All sides are concerned about the present situation and future of China-US trade and economic cooperation.

Against this background, the Ministry of Commerce released the Research Report on China-US Economic and Trade Relations to give a panoramic description of China-US trade and economic relations and clarify China’s position and view of bilateral trade and economic cooperation. The report consists of Introduction, the Historical Background of China-US Economic and Trade Relations, the Mutually Beneficial Nature of China-US Economic and Trade Relations, Major Concerns about China-US Economic and Trade Relations, Promoting the Development of China-US Trade and Economic Cooperation, and Conclusion. The report illustrates by data and examples that the nature of China-US trade and economic relations is win-win cooperation, economic globalization is the basis of profound development of China-US trade and economic relations, and the WTO rules multilateral and bilateral agreements are the legal guarantee of China-US trade and economic relations. To conduct China-US trade and economic cooperation is the natural result of advantage complementarity and also a necessary choice of international division of labor force and optimum resources allocation. Both US and China could gain great and balanced interests from bilateral trade and economic cooperation. The report also introduces main trade and economic topics for which each side is concerned and proposes suggestions for bilateral pragmatic cooperation.

At present, uncertain factors in the world economy have been increasing and some economies have doubts on the direction of economic globalization. All sides expect that China and US could conduct dialogue, strengthen cooperation, and jointly promote global economic recovery. We would like to strengthen cooperation with the US to realize the sound, steady and sustainable China-US trade and economic relations and benefit people of both sides.

II. Trade and Economic Achievements of the Belt and Road Forum for International Cooperation

The Belt and Road Forum for International Cooperation was successfully held in Beijing on May 14-15. During the forum, MOFCOM hosted the Thematic Session on Trade Connectivity, attended by about 200 guests from over 60 countries and 14 international organizations. Among these, there were 116 foreign guests and 72 foreign officials above ministerial level.

Minister of Commerce Zhong Shan chaired the session and made a keynote speech. He said the keynote speech by President Xi Jinping at the opening ceremony has elaborated the spiritual connotation of the Belt and Road initiative, reviewed the fruitful results made by the Belt and Road construction and proposed ways and moves for cooperation and development in the future from the perspective of global development. Guided by President Xi Jinping’s speech, the Thematic Session on Trade Connectivity carried out in-depth talks on trade connectivity, pool ideas, built consensus, provided experience and wisdom for Belt and Road trade and economic cooperation and reached a series of important trade and economic achievements.

During the brief meeting, China has signed 86 cooperation agreements on trade and economic cooperation with relevant countries and international organizations, covering a wide range of areas such as free trade area, investment, infrastructure, economic cooperation zone, small and medium-sized enterprise cooperation, and e-commerce. Among them, China jointly issued the Cooperation Initiative of Promoting Trade Connectivity of the Belt and Road Initiative with 83 countries and international organizations. President Xi Jinping officially announced it in his keynote speech at the opening ceremony of the forum and incorporated it into the result list of the Belt and Road Forum for International Cooperation.

Minister Zhong Shan put forward five significant measures in this keynote speech, including China International Import Expo since 2018, the implementation of 100 trade and investment promotion projects in cooperation with the countries along the line, 10,000 research and training places in China for countries along the line in the next five years, and support for 20 trade and investment promotion arrangements of the WTO and relevant United Nations agencies. We are working with relevant departments to speed up the implementation of relevant work, and strive to enable the cooperation initiative of trade connectivity of the Belt and Road Initiative to be changed into the result of promoting the construction of the “Belt and Road”.

III. Trade and Economic Achievements of the 23rd APEC Trade Ministers' Meeting

On May 20-21, the 23rd APEC Trade Ministers' Meeting was held in Hanoi, Vietnam. Minister of Commerce Zhong Shan led Chinese government delegation to attend the meeting.

This is the first important multilateral international conference after the Belt and Road Forum on International Cooperation held by China, conducting discussions on strengthening regional economic integration, multilateral trade system development, APEC "post-2020" vision, promoting sustainable, inclusive, innovative growth and enhancing the competitiveness and innovative ability of small and medium-sized enterprises. The meeting issued the Chairman Declaration of Trade Ministers’ Meeting, which embodied the position of the vast majority of the economies supporting the multilateral trading system and opposing trade protectionism. The meeting passed the Joint Action of the 23rd Trade Ministers' Meeting, which laid a framework foundation for economic and trade outcomes of the unofficial meeting of the leaders of Da Nang in November this year.

It is noteworthy that during the meeting, the Chinese government delegation submitted the Non-document of Trade and Investment Cooperation Vision of “Post 2020” of the APEC by China, putting the “post 2020 vision” on the agenda. China put forward a series of new ideas, including the establishment of a new concept of “common discussing, common building and common sharing”, realizing a comprehensive and high-quality Asia-Pacific Free Trade Area, building a comprehensive trade interconnectivity, creating a more inclusive Asia-Pacific global value chain, cultivating new sources of economic growth, and striving to guide all economies to enhance consensuses and bridge differences. These won positive response of the economies and promoted the meeting a complete success.

VI．Trade and Economic Achievements of the Ministerial Conference on RCEP

On May 21-22, the Ministerial Conference of RCEP was held in Hanoi, Vietnam. Trade ministers from China, Japan, South Korea, Australia, New Zealand, India and ASEAN 10 and ASEAN Secretary-General participated in the conference. Chinese Minister of Commerce Zhong Shan led the Chinese government delegation to attend the meeting.

China put forward three suggestions in the meeting: first is to support ASEAN in taking a leading role, and expand the consensus; second is to seize the opportunity window, and end the negotiations as soon as possible; third is to take into account the demands of all parties and practically promote negotiations.

The meeting finally reached the Document of Achievement of the 3rd Ministerial Inter-sessional Meeting of the RCEP, and issued the Joint Media Statement of the Ministerial Inter-sessional Meeting of the RCEP. Trade and economic ministers of all countries agreed that the negotiations should take into account the different levels of development of parties, and strive to achieve reciprocal results with commercial value, and achieve balance in all fields such as goods, services and investment.

In terms of the next step of the RCEP negotiations, the trade ministries of all countries have arranged the 2017 work plan in detail and instructed the Trade Negotiations Committee to redouble its efforts to solve the remaining problems and reach a modern, comprehensive, high quality and mutually beneficial RCEP agreement as soon as possible, and to achieve the goal of concluding the negotiations quickly as was instructed by the leaders from all the countries.

V. Achievements gained in the one year of constructing the comprehensive pilot of the new system of open economy

To implement the Opinions of the State Council on Constructing New System of Open Economy, in May 2016, the Ministry of Commerce, together with State Development and Reform Commission, launched the comprehensive pilot work on constructing the new system of open economy. Over the past year, the 12 pilot cities and regions, according to their own features, innovate reform measures and actively implement the pilot plans, and gained positive achievements, which mainly showed in six “new points”:

The first one is the new mode of streamlining the administration and delegating power to the lower levels. For example, in projects review, Zhangzhou municipality implemented the reform of “one form for several evaluations and one examination for several charts.”. Dongguan municipality realized the full process electronized business registration, which effectively simplifies the govermental examination and approval procedures and optimizes the on-site and post-project supervision system.

The second one is the new method of investment and cooperation. The pilot areas actively implemented the reform of “simplifying, decentralization and service” for foreign invested projects, promoted the facilitation for overseas investment. For example, Suzhou Industrial Park established the first national service demonstration platform for overseas investment, exploiting new channel of international capacity cooperation.

The third one is the new system of foreign trade development. The pilot areas speeded up the building of new foreign trade promotion system guided by quality and efficiency, promoted the building of “Single Window” of international trade and cultivated proprietary brands of foreign trade and overseas marketing system. For example, Fangchenggang municipality tried the supervision mode of “one inspection of the two countries” between China and Vietnam; Dalian Jinpu New Area conducted “one-stop” customs clearance service center, so that the cost for inspecting single box of goods was saved for 1,000 yuan, and the time waiting for inspection was reduced over 50%.

The fourth one is the new measures of financial services. The pilot areas constantly promoted the international operation level of the financial organizations of the region, innovated and developed featured financial products and services, and expanded the cross border transaction of the Chinese yuan. For example, Shanghai International Financial Assets Transaction Platform opened officially; Chongqing Liangjiang New Area established credit security insurance organizations, raising 20 billion yuan development fund for strategic industries.

The Fifth one is the new mechanism of coordination opening up. The pilot areas integrated the pilot policies of different kinds of parks, and constantly optimized the mechanism of park development. For example, Tangshan municipality integrated 26 development zones into 19 zones, in order to forge economic growth pole intensively.

The sixth one is the new pattern of comprehensive opening up. The pilot areas actively dock with the national strategies like “Belt and Road”, forming characteristic highlands of opening up. For example, Dalian Pujin New Area established the complexes of comprehensive service and modern parks facing Japan and ROK, as well as influencing the northeast China.
Next, we will strengthen the guidance to the pilot areas, and supported the favorable areas to speed up their pilot plans. According to the requirements of profession and independence, we will conduct the third-party evaluation to the pilot areas and cities, so as to summarize a batch of duplicable and promotable experience and practice.

VI. MOFCOM launched 2017-2018 declaration work of e-commerce demonstration enterprises

Recently, the Ministry of Commerce officially issued the announcement of arranging the 2017-2018 declaration work of e-commerce demonstration enterprises.

The work was launched since 2010, and MOFCOM has identified three batches of e-commerce demonstration enterprises, which played active and leading role in promoting equality and efficiency of e-commerce and integrating with traditional industries. They also promoted the healthy and rapid development of the Chinese e-commerce.

The demonstration contents will focus on the innovation and development of five aspects including promoting equality and upgrading, integrating with traditional industries, the market construction of e-commerce elements, innovation of service for people’s livelihood and optimization of e-commerce market environment. That is to say, the above five aspects will be the major factors to identify demonstration enterprises.

To ensure the demonstration role of the enterprises, the Ministry of Commerce optimized the dynamic management mechanism, and conducts evaluation to the e-commerce demonstration enterprises every year. During the two demonstration period, the excellent enterprises will automatically be on the list of the next batch of demonstration enterprises without declaration; the enterprises performing badly in the evaluation will be knocked out, and lose the qualification to apply for the next batch of demonstration enterprises.

According to the requirement of the declaration, there are six declaration types of enterprises including online retail enterprises, online wholesale enterprises, network service enterprises, comprehensive e-commerce enterprises and the other e-commerce enterprises. The Ministry of Commerce will announce the list of e-commerce demonstration enterprises of 2017-2018 in August.

In terms of the specific requirements to the declaration enterprises, you can look it up in the Work Notice column on the website of Ministry of Commerce, and you can also consult the local commercial departments.

Q: It is said that the joint feasibility study on China-Mauritius FTA has been finished. Can you share with us more information?

A: Vice Minister of Commerce Qian Keming visited Mauritius on May 24th 2017. The Chinese side and the Mauritian side signed the Memorandum of Understanding and announced the conclusion of joint feasibility study on China-Mauritius FTA.

As the first FTA study that China conducted with an African economy, the joint feasibility study on China-Mauritius FTA was initiated in November 2016. The two sides had comprehensive and in-depth analysis and study on the feasibility of China-Mauritius FTA, and drew the conclusion that the FTA is in the interest of both countries and conducive to strengthening bilateral economic and trade relations.

Q: On May 22nd 2017, the Ministry of Commerce announced its final determination on the safeguard measure investigation on imported sugar, which has been widely reported by media in Brazil, the largest source of China’s sugar import and international media like Financial Times and Wall Street Journal. What’s the comment of MOFCOM?

A: At the petition of Chinese domestic industry, the Ministry of Commerce incepted safeguard measure investigation on imported sugar on September 22nd, 2016. During the investigation, MOFCOM has strictly abided by Chinese laws and regulations as well as WTO rules, and widely solicited opinions of both domestic and foreign parties. Judging from the import situation and serious injury caused to domestic industry, MOFCOM made the final ruling in accordance with laws on May 22nd 2017.

I want to emphasize that the safeguard measures adopted can maintain the fair and predictable sugar market and sugar trade order and therefore serve the fundamental and long-term interests of all parties. We are willing to work with all relevant parties to develop external trade and economic cooperation and encourage the exchanges between industries for win-win results.

Q: German Federal Minister for Economic Affairs and Energy Brigitte Zypries said that China fails to enable free trade because in certain industries such as the automotive sector German companies have to establish joint ventures with local Chinese partners, which is a practice violates the spirit of free trade. What’s your comment?

A: Foreign investment attraction has always been an important part of China’s basic state policy of opening up. Over the years, the Chinese government has been liberalizing the market to foreign investment on the basis of its WTO commitment. Under the Chinese laws governing foreign investment, most industries and sectors are fully open for foreign investors. Only a few sensitive sectors are subject to foreign ownership ceiling and number of these sectors is also decreasing as China continues to open up. In the Industry Catalogue for Foreign Investment 2015, the number of industries subject to compulsory local partner requirements was reduced from 43 to 15.

In fact, German automotive companies are one of the biggest beneficiaries of China's opening up drive. As early as in the 1980's, Germany's well-known car companies came to invest and set up factories in China. They have witnessed China's reform and opening up, its 30 years of continuous expansion of opening up, and its efforts to improve the investment environment. In return, they have received high returns on investment.

I would like to emphasize that China encourages foreign investment in high-end manufacturing, including automobiles, and will continue to relax restrictions and expand opening up in an orderly manner. In late April of this year, with State Council approval, the Ministry of Industry and Information Technology and other two ministries jointly issued the Long-term Development Plan of the Automotive Industry to "improve the domestic investment management system and orderly relax the equity cap restrictions for joint ventures." The Catalogue for the Guidance of Foreign Investment Industries, which was being amended, also proposes to relax equity cap restrictions for foreign investment in automotive electronics, new energy vehicle batteries and motorcycles. On May 23rd, the amended Catalogue was reviewed and endorsed by the 35th meeting of Central Leading Group for Comprehensively Deepening Reform, and is going to be published for implementation soon.

Q: Reuters reported on the 19th that China has been Germany's single largest investor for the past three consecutive years, with a total of 281 new investment projects. Could the Ministry of Commerce elaborate on it?

A: It is said that the Germany Trade & Invest issued on May 18 its Foreign Investment Report 2016, which says that China invested on 281 projects in Germany in 2016, and remained the largest investor in terms of project number for the third consecutive year (260 projects in 2015 and 190 in 2014). The report also points out that through their 281 projects Chinese enterprises have created 3,900 jobs for the local communities, setting a record for the number of jobs created by Chinese investors in Germany. In addition, according to German statistics, Chinese investment in Germany reached 11 billion euros in 2016, surpassing for the first time German investment in China. This shows that Sino-German investment has evolved from "one way" to "two-way".

China's investment in Germany is still at the beginning stage, with rapid growth but limited size, as it accounts for only 1% of Germany's total inward foreign investment. We hope that the German government could further provide a sound legal environment for and facilitate Chinese investment in Germany. We are also happy to see German companies further expand their investment in China and have their share of opportunities in the China market.