Dear friends from the press,

Good morning, welcome to the regular press conference of the Ministry of Commerce (MOFCOM). First of all, I have three pieces of information to release.

I. Consumption Market Operation Situation in July 2017

According to the National Bureau of Statistics, in July, the total retail sales of consumer goods reached 2.96 trillion yuan, with an increase of 10.4% year on year, 0.2 percentage points higher than in the same period last year, and up 9.6% excluding the price factor. That from January to July was up 10.4% year on year, the same as the first half of the year. The retail sales of 5,000 key enterprises monitored by MOFCOM increased by 5.1% in July year on year, 1.4 percentage points higher than in the same period last year, the highest after 2015.

In July, China’s consumption market maintained a smooth and upward growth, mainly presenting the following highlights:　　

1. The online retail sales maintained a rapid growth. According to the National Bureau of Statistics, the online sales of national entity increased by 28.9% year on year from January to July, 0.3 and 2.8 percentage points higher than that of the first half of the year and the same period last year respectively, accounting for 13.8% of total retailing of social consuming goods, 2.2 percentage points higher than in the same period last year. In July, the online retail sales of key enterprises monitoring by MOFCOM rose by 20.5% year on year, 18.6, 16.9, and 14.9 percentage points higher than those of the stores, supermarkets and shopping centers respectively.　

2. The sales of cars and home appliance enjoyed a rapid growth. The newly updated the Measures for Administration of Automobile Sales was officially launched on July 1 and this made car purchasing more convenient and affordable. In July, the sales of cars above the designated size rose by 8.1% year on year, 3.9 percentage points higher than the first half of the year. Influenced by the wide range of continuous hot weather, the air-conditioners, refrigerators and electric fans continued to enjoy a hot selling, driving the sales of the home appliances above the designated size up 13.1% year on year, 1.6 percentage points higher than in the same period last year. Besides, under the influence of the increasing summer trips and entertainment activities, the sales of petroleum and petroleum products above the designated size increased by 5.6% year on year, 1.4 percentage points higher than the last month. The sales of sports and entertainment products rose by 26.6% year on year, 9.5 percentage points higher than the first half of the year.

3. The summer vacation market of service consumption kept prosperous. In July, the national catering revenue reached 1.85 trillion yuan, up 11.1% year on year, 0.2 percentage points higher than that of last year with the enterprises above the designated size 3 percentage points higher; the film tickets revenue reached 5.05 billion yuan, up 12% year on year; family trip, renowned university tour, summer resort tour and island tour were popular, for example, the tourists of Guihzou Province were up 40% year on year, the tourists of Yunnan Stone-Forest Scenic Spot reached 30,000, and the passengers served by Qunming Railway Bureau increased by 20% year on year.

4. The consumption price went up slightly month on month. The CPI increased by 1.4% year on year in July, 0.1 percentage points slower than that of last month, up 0.1% month on month, ending the two-month negative growth. Prices of edible agricultural products from 36 large and medium cities monitored by the MOFCOM was down 0.3% month on month, keeping picking up for six month but 1.6 percentage points slower than that of the last month; the prices decreased by 2% year on year, and that of January to July went down by 4.7% year on year. The prices of pork, eggs and vegetables picked up in July. The average wholesale price of pork went up by 0.7% month on month, ending the five-month consecutive decline. The price of eggs increased by 3.8% month on month and kept rising for two months. The price of thirty kinds of vegetables rose by 3.1% month on month.

With the sustainable and upward development of national economy, the optimization of structural adjustment and the implement of supply-side structural reform, the consumption market is expected to remain steady and rapid growth in the later period.

II. The Trade and Economic Achievements of the 3rd Conference of China-Indonesia High-level Economic Dialogue

On August 22, State Councilor Yang Jiechi and Indonesian Coordinating Minister for Economic Affairs Darmin Nasution co-chaired the 3rd Conference of China-Indonesia High-level Economic Dialogue in Beijing.

Both sides spoke positively of the achievements after the second conference. They exchanged views on seven key topics such as the promotion of the Belt and Road Initiative and the cooperation on trade investment and production capacity, finance, energy, e-commerce, infrastructure and agricultural and fishery industries. Broad consensus has been reached and substantial achievements have been made.

They agreed to deepen the implementation of China’s 21st Century Maritime Silk Road Initiative and Indonesia’s Global Maritime Axis concept, advance the cooperation of bilateral trade and investment and key projects and promote China-Indonesia economic cooperation. They agreed to let the trade working group negotiate the effect ways to promote the healthy and balanced development of bilateral trade, rely on the inter-ministerial investment promotion cooperation mechanism between the MOFCOM and Indonesia Investment Coordinating Board to promote the marketing activities in China, and speed up the negotiation on renewing the currency swap agreement and the building of e-commerce cooperation exchange mechanism. Both sides promised to continue to strengthen infrastructure cooperation, support the Chinese enterprises’ engagement in Indonesia’s construction of the comprehensive off-island economic corridor and help to develop local industries, connectivity, tourism and electric power. At the same time, they promised to create the conditions for the joint implementation of major infrastructure cooperation projects such as Jakarta-Bandung high-speed railway and strengthen dialogues and communication to enhance cooperation in agricultural and fishery industries. China will hold China International Import Expo next year. Indonesia is welcome to set up investment promotion center and the representative office of Indonesian central bank, and China will provide necessary assistance.

After the meeting, Yang and Darmin witnessed the signing of the minutes of the 3rd Conference of China-Indonesia High-level Economic Dialogue and that of the memorandum of understanding the infrastructure financing cooperation.

As the initiator of this economic dialogue, the MOFCOM will straighten out the follow-up implementation work of the key cooperation items of this meeting with Indonesian Coordinating Ministry for Economic Affairs and will implement the consensus reached in this meeting with relevant departments, striving for new trade and economic achievements in cooperation of different sectors.

III. Situations Related to the Qingfeng Action on Silk Road

On August 22, the Office of the National Leading Group on Fighting against IPR Infringement and Counterfeiting held “Qingfeng Action on Silk Road” in Zhengzhou, a work conference on inter-regional collaboration in combating IPR infringement and counterfeiting in ten provinces (autonomous regions and cities), intending to deploy the cross-regional joint action against IPR infringement and counterfeiting. Attending were the representatives of relevant departments from Henan, Shandong, Hubei, Chongqing, Tibet, Shaanxi, Gansu, Qinghai, Ningxia and Xinjiang attended the conference.

This joint action focused on the construction of the Belt and Road Initiative with emphasis on the unified rectification of various goods, including the import and export goods transported by China Railway Express, the infrastructure construction materials, machinery and equipment for import and export between the countries along the Belt and Road Initiative and cross-border e-commerce goods, particularly goods purchased from overseas online vendors. It aims to create good import and export environment for the construction of “Belt and Road.” Relevant authorities will establish an inter-regional work mechanism for information sharing, case consultation and joint action on law enforcement, build the regional coordination and the linage of administrative law enforcement and criminal justice to strengthen oversight on the production source, distribution channel and links of import and export, break the counterfeiting chain, support the outstanding enterprises and products in “going global” and building a good image of being “Made in China”.

The Chinese government has always paid high attention to IPR protection. In fact, infringement and counterfeiting has become a global problem. We would like to work with countries and regions along the “Belt and Road” line to continue to strengthen cooperation on the fight against cross-border infringement and counterfeiting, enhance IPR protection, ensure the legitimate rights of enterprises and consumers worldwide and create a fair competitive business environment.

That's all for the information. Now please ask your questions.

CCTV: On August 19, the Office of the United States Trade Representative announced initiating a 301 investigation on China. How will it affect trade and economic cooperation between China and the US? Will it trigger a trade war? How will China respond?

Gao Feng: Thank you for your question. MOFCOM made a stand against the initiation of the Section 301 investigation through spokesman’s comments on August 21. I want to stress that the US initiates a trade investigation on China based on its own laws is disruptive to the current international trading system and dampens the enthusiasm of all parties committed to growing the Sino-US commercial relations. We express strong dissatisfaction with such unilateral and protectionist actions. We will take all appropriate measures to firmly safeguard the legitimate rights and interests of China and Chinese enterprises.

China always believes that on the trade and economic fronts, the common interests shared by China and the US far outweigh their differences. The two countries are able to accommodate divergent views and work towards mutual benefits and win-win results. Cooperation is the best way to sort out differences. We hope the US will continue to work with China, build on the good outcomes of the 100-day action plan and thoroughly implement the one-year plan on economic cooperation so as to achieve more results at an early date. This will keep the bilateral trade and economic relations on a sound and stable track and is in the interest of not only the industries but also the peoples of both China and the US. Thank you.

Economic Daily: MOFCOM and other three ministries have jointly issued the Opinions for Guiding and Regulating Outbound Investments recently. How will MOFCOM implement the document? What other regulatory measures will be taken as to Chinese outward investment? Thank you.

Gao Feng: Thank you for your question. Let me give a brief overview of the background of the document. In recent years, to suit domestic and international trends and their own development needs, Chinese enterprises have actively made outbound investment. While enhancing their international reputation, these enterprises have also boosted exports of products and technologies, facilitated economic transformation and upgrading in China, promoted the Belt and Road building and international capacity cooperation and deepened the mutually beneficial cooperation between China and relevant countries.

However, Chinese investors overseas have also encountered problems. Starting from last year in particular, irrational outbound investment has grown at breakneck speed, posing risks and threats to the security of financial sector and state assets. In order to address the new circumstances facing China’s outbound investment, four ministries have collaborated with pertinent agencies to draft the Opinions, which was issued with the State Council’s approval.

Centering on the supply-side structural reform and the Belt and Road initiative, the Opinions aims to further guide and regulate the directions of outbound investment, enable enterprises to invest overseas in a rational and orderly fashion, prevent and respond to risks overseas, promote sound and sustained growth of outward investment and achieve win-win results and common development in China and the host countries.

Going forward, based on the instructions by the Central Committee of the CPC and the State Council, MOFCOM will press ahead with the reform in outbound investment management system and stay committed to the opening up strategy, the going global strategy and the principle of preventing risks overseas. We will strive to ensure that Chinese outbound investment grows in a stable and sustainable way, the Belt and Road initiative moves forward smoothly and China enjoys financial and economic security.

We will give priority to the following work. First, we will step up examination of the authenticity of outbound investment, encourage real outbound investment that complies with laws and regulations and forcibly prevent false and irrational investments. Second, we will further improve the filing system for outbound investment management and provide guidance for and regulate investors in the model of pro-development plus negative list. Third, we will strengthen regulation during and after the investment, delegate powers, streamline administration and optimize government services and conduct inspection on outbound investments in a random way and publicize the results so that enterprises can explore overseas market in a healthy way. Fourth, we will press ahead with legislation on outbound investment and provide rule-based guidance, monitoring, regulation and safeguard. Fifth, we will improve the public services system, consolidate resources into a public services platform for going global and provide one-stop information services with a view to helping enterprises better prevent and tackle risks overseas. Thank you.

CNR: We’ve noted that while China's inward foreign direct investment in the first half of this year fell slightly by 0.1%, the number for the first seven months dropped by 1.2%, meaning that the decline in July was a substantive one. Could you please talk to us about the main reasons for the decline? Thank you.

Gao Feng: Thank you for your question. Since the beginning of this year, there have been some fluctuations in the country’s inward foreign direct investment. From January to July, the actualized foreign investment stood at 485.42 billion yuan, down by 1.2% over the same period of last year. The amount of foreign investment actually used in July was 43.89 billion, down by 11.8% year on year. This had to do with both the overall global environment for transnational investment this year and some seasonal factors. According to the latest forecast released by the United Nations Conference on Trade and Development (UNCTAD) in June this year, the expected growth margin of global foreign direct investment in 2017 was revised down from 10% at the beginning of the year to 5%.

It is fair to say that this year, China's overall scale of inward foreign direct investment has remained stable. From January to July, the number of newly-established foreign investment enterprises in the country was 17,703, an increase of 12% year on year, indicating that more and more foreign investors are willing to come to China. At the same time, China’s FDI structure is also being constantly optimized, while the trend of moving upward to the higher-end industries continues. For example, from January to July this year, the actualized foreign investment in high-tech manufacturing was 37.39 billion yuan, an increase of 8.3% over the same period of last year. The actualized foreign investment in high-tech service industry was 70.31 billion yuan, up 16.8% year on year.

In the medium to long term, China's comparative advantages in and terms for attracting foreign investment still remain prominent. The UNCTAD’s World Trade Report 2017 points out that China remains one of the main destinations for foreign direct investment.

Recently, the State Council issued a Circular on Several Measures to Promote Foreign Investment Growth. We have launched 22 new policy measures. In addition, the provinces and cities have also introduced special policies on investment promotion. To our knowledge, there are currently 16 provincial level documents issued. We believe that foreign investors can see the determination of the Chinese government at all levels to continue to expand opening up and actively promote the use of foreign capital. Foreign investors will soon see the development opportunities brought about by our new policy measures.

We will also deepen the reform of the foreign investment management system, further expand opening up, continue to provide better services for foreign companies as they enter China, and create a better environment so that China remains always a popular destination of foreign investment. Thank you.

Macau Asia Satellite Television: We have noted that the Chinese Ministry of Commerce recently launched antidumping investigations on optical fiber preforms originated in the United States and Japan and on dispersion-unshifted single-mode optical fibers originated in the United States and the EU. We would like to ask if this could be interpreted as a countermeasure by the Chinese side to the United States’ Section 301 investigation. Thank you.

Gao Feng: Thank you for your question. As regards the two anti-dumping case-filings you mentioned, the Ministry of Commerce acts in strict accordance with the provisions of the Anti-Dumping Regulations.

On the optical fiber preforms case, we adopted from August 19, 2015 onward anti-dumping measures for imported optical fiber preforms originated in the United States and Japan, with an implementation period of 2 years, expiring on the 18th of this month. Under the provisions of the Anti-Dumping Regulations, the domestic industry or its representatives may file an application for review within 60 days before the expiry of the case. In June this year, the Ministry of Commerce received the application by some domestic industry representative. Per review, we found that the application met the conditions for case filing, and therefore filed a case on 18th.

On the dispersion-unshifted single-mode optical fiber case, we implemented anti-dumping measures on imports of dispersion-unshifted single-mode optical fibers originated in the United States and the European Union from 21 April, 2011 onward. In 2016, we conducted a sunset review of the case, and decided to extend the implementation period by 5 years. In May this year, the domestic optical fiber industry petitioned for an interim review to re-calculate the dumping margins concerning the United States pursuant to relevant provisions of the Anti-Dumping Regulations. Having conducted the review according to law, the Ministry of Commerce as the investigative authority formally launched the investigation on August 22.

The above two cases have been carried out in full compliance with the legal procedures; and no other factors have been considered. Thank you.

China Daily: Recently, India has launched a string of aggressive antidumping actions against China. What are MOFCOM’s comments? What will China do in response?

Gao Feng: Thank you for your questions. India has been an active user of antidumping measures in the WTO. Since 1994, it has instituted 212 antidumping investigations against China, with 93 antidumping measures still effective today. This year, India has opened 13 antidumping investigations into Chinese products.

China pays high attention to the momentum of India’s case-filing and urges caution and restraint in its use of trade remedies. WTO rules should be observed closely in the investigations to avoid the abuse of trade remedy measures and disruption to normal bilateral trade. We will act firmly to protect the lawful rights and interests of Chinese businesses and also encourage and support an active role of related companies in responding to the cases.

Despite the slow recovery of the world economy, instabilities and uncertainties are still aplenty. Both being members of BRICS and major developing nations, China and India should make common cause to maintain a free and open multilateral trading system and serve as an anchor for global economic growth. China and India enjoy broad potentials for trade and economic cooperation. Dialogue and consultation is the only effective way to settle trade frictions. We’d like to work with India to set up a platform for dialogue and consultation for the industries of the two countries and strengthen industrial cooperation to appropriately resolve trade frictions for mutual benefit and win win. Thank you.

Yicai: We’ve noted that the WTO said on Monday that the US had asked the organization to establish a panel to look into China’s use of tariff rate quotas. What is MOFCOM’s response? Thank you.

Gao Feng: Thank you for your question. On Aug. 18th Geneva time, the US filed a request with the WTO Dispute Settlement Body for setting up a panel for its case against China of import TRQ management for wheat, rice and corn. China also received the US request on the same day.

In fact, the US made a request for consultation with China for this case in Dec. 2016 under the framework of the WTO Dispute Settlement Mechanism. The two sides held formal consultations in Geneva in Feb. 2017. China believes that the two sides have maintained smooth communications on TRQ bilaterally and multilaterally. At US request, China gave clarifications and explanations regarding policies relating to the case. China regrets the US decision to give up consultation.

China holds that the TRQ is a trade management regime explicitly preserved at its accession to the WTO. The TRQ management of related agro-produce is in line with China’s accession commitments and related WTO rules. Chin will deal with the case appropriately according to the due process of WTO dispute settlement. Thank you.

China News Service: We’ve noted that India has recently tightened the access of Chinese power companies to its electricity transmission sector and run strict malware checks on power and telecommunications equipment. What’s MOFCOM’s response?

Gao Feng: Thank you for your question. The Chinese government is adamant that Chinese business should abide by the laws and regulations of host countries in outbound investment cooperation and local operations. China and India are important economic and trading partners to each other with mutually beneficial and win-win commercial cooperation. China hopes that India will honor international norms relating to trade and investment, avoid setting discriminatory access conditions and exercise caution in introducing related policy measures.

Actually, increasing FDI in India has contributed positively to India’s continued rapid economic growth, employment and tax receipts, industrial base and people’s living standards. We also believe that the Indian government is willing to create a fair, transparent and easy investment and business environment for investors from China and other countries. Thank you.

Gao Feng: This concludes today’s press conference. Thank you all.