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Regular Press Conference of the Ministry of Commerce (December 7, 2017)

Dear friends from the press,

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

This is about extending the transitional period for cross-border e-commerce retailing import regulation policy.

On September 20, 2017, the 187th State Council executive meeting decided to extend the transitional period for cross-border e-commerce retailing import regulation policy for a year to the end of 2018. By then, the cross-border e-commerce retailing import goods will be temporarily regulated as personal items in ten pilot cities (regions) including Tianjin, Shanghai, Hangzhou, Ningbo, Zhengzhou, Guangzhou, Shenzhen, Chongqing, Fuzhou and Pingtan. This decision to extend the transitional period has fully showed China’s “tolerant and prudent” regulation concept for new business formats and modes. Furthermore, it has kept the continuity of current policies and stabilized the industry expectation. This has played a positive role in the development of cross-border e-commerce retailing import and has won broad support from the enterprises of the industry.

In order to implement the spirits of the State Council’s reply and give better play to the pilot work of cross-border e-commerce comprehensive pilot areas, approved by the National Development and Reform Commission, Ministry of Finance, General Administration of Customs, the State Administration of Taxation, State Administration for Industry and Commerce, the General Administration of Quality Supervision and Inspection and Quarantine and Food and Drug Administration, the transitional period policy will extend to another five cities including Hefei, Chengdu, Dalian, Qingdao and Suzhou,starting from January 1, 2018. Next, we will continue to implement the decisions and deployment of the CPC and the State Council earnestly, and draw out the regulation plans for cross-border e-commerce retailing import to help the enterprises transit smoothly.

During the extension period, e-commerce enterprises, platforms and other related parties should fulfill their own duties, strengthen industrial self-discipline, build and improve risk prevention and control system and practically protect the consumers' rights and interests. All pilot cities should see to the organization and implementation of local cross-border e-commerce retailing import work and push forward the relevant enterprises to fulfill their duties in order to jointly promote the healthy development of the cross-border e-commerce retailing import.

It should be pointed out that at present, the cross-border e-commerce retailing import goods will be temporarily regulated as personal items in China. Although necessary quarantine has been conducted, meeting the domestic standards is not required and the quarantine requirements on the imported goods are not been performed. The supervision departments have found out some quality and safety problems during the risk monitoring process of the cross-border e-commerce retailing imported goods, mainly including pests carrying, packaging and the non-standardized labeling of goods. The consumers are recommended to first get the full information of the goods, then buy goods at the e-commerce enterprises and platforms with standardized management and relatively sound traceable system.

That’s all the information I’d like to share with you. Now I’d like to answer your questions.

CRI: We’ve leant that the eleventh WTO Ministerial Conference will be held in Argentina. What are the expectations of China?

Gao: The eleventh WTO Ministerial Conference will take place between December 10 and 13 in Buenos Aires where ministers from 164 WTO members will review progress of the organization in the past two years, discuss the direction of the multilateral trading system down the road and strive to secure success in negotiations on specific issues. Minister Zhong Shan will lead the Chinese delegation at the Conference.

At this Conference, China hopes to continue to work together with all members, particularly developing ones, to firmly uphold the authority and efficacy of the multilateral trading system and the WTO rules and create a stable, transparent and predictable environment for international trade.

In our view, the cause for multiple uncertainties and destabilizing factors in the world is unbalanced development. As China enters a new era, we are willing to share benefits of development with all WTO members, push for an open world economy and promote recovery and growth of the world economy. We look forward to joining other WTO members in upholding the unity of the organization and securing positive outcomes at the MC11. Thank you.

CPR: According to the head of the Department of Treaty and Law of MOFCOM, China has filed a new case against the US after the Trump administration denied China the status of market economy. Some people view this as a sign of worsening relationship between the two countries. What’s MOFCOM’s comment? Thank you.

Gao: The US statement to the WTO dispute settlement body that China is the so-called “non-market economy” is an attempt to give the six criterions in its domestic law a higher status than international law. The WTO rules are observed by all members as an international legal framework. We don’t want to see the US turns a blind eye to the international rules.

Yesterday the WTO DSB held a hearing on the case China launched against the EU for using “surrogate country” approach, where China elaborated on its points. We have no idea of the US’s intention to say something like that in such a conspicuous way just days before the hearing, especially when it is only a third party, not directly involved in the case. We hope the panel can handle the case fairly and make unbiased judgment in accordance with international rules. We have made it clear that China will conscientiously fulfill its WTO obligations while enjoying all the rights under the WTO. All WTO members must honor their international obligations related to the Article 15 of the Protocol of China’s Accession to the WTO in a timely manner.

China has filed a new case to the WTO against the US for using surrogate country in anti-dumping investigations. We urge some WTO members, including the US, to firmly and comprehensively meet their WTO obligations and uphold the multilateral trading system. Thank you.

CGTN: China and the US reached a series of outcomes on trade and economic fronts during President Trump’s visit to China a month ago. However, it seems the US has made a U-turn after the President returned the US. To start with, the US launched a string of AD/CVD investigations on China’s aluminum. Last week, the US opposed giving China the market economy status. What’s your view on these moves by the US? Does it mean the bilateral trade relations are deteriorating? Some people think it heralds a trade war between China and the US. What’s your take on that?

Gao: We always believe that China-US trade and economic relations is mutually beneficial by nature. Since the successful Mar-a-Lago Summit, the two Presidents have stayed in close contact, chartering the course for sound and stable growth of the bilateral commercial relations. President Trump’s successful state visit in November concluded with a series of important consensus reached between the two Presidents, who are committed to promoting mutually beneficial and win-win trade and economic cooperation between our two countries. With historic cooperation outcomes achieved by enterprises of China and the US during the visit, the business community has been given reassurances about growing bilateral cooperation.

Over the past 40 years, China-US commercial relations have moved forward despite twists and turns. China has always valued a stable and predictable climate for trade and economic cooperation and worked tirelessly to make it work. However, the US has sent a negative signal through the recent trade remedy investigations against China’s products, which has raised some concerns among businesses on both sides, especially American companies that are willing to do business in China and explore China’s market. We don’t think it is a constructive action. Trade protection leads to negative consequences. Only through openness and cooperation can we make the cake bigger. We hope the US can really take care of business interests.

When it comes to trade frictions, both sides should manage and control differences properly via dialogues and consultations, including business engagement, deepen mutual understanding and promote win-win business cooperation. We will continue to move towards this direction and hope the US will join us. Thank you.

Economic Daily: We understand that EU governments approved the revised antidumping margin calculation on Monday, which will remove the influence of ‘non-market economy status’ on China. Some report claims that this will boost Chinese exports, but China seems to have reservations. What is MOFCOM’s take? Thank you.

Gao Feng: We’ve noted that on Dec.14th, the European Council passed an amendment to the anti-dumping calculation method, scrapping the so-called ‘list of non-market economy countries’ and thus the legal assumption that China is on the ‘list of non-market economy countries’ in EU anti-dumping law. We believe that this represents an effort on EU’s part to fulfill international obligations as a major member of the WTO.

Nevertheless, we’ve also noticed that the EU has introduced the concept of ‘market distortion’ and retained the surrogate country system as an option. We believe that such a move lacks basis in WTO rules and compromises the authority of the WTO’s anti-dumping legal system. In the meantime, we’re concerned about the potential abuse of the concept in the EU’s future legal practices.

We hope that the EU, as a major and responsible member of the WTO, can closely abide by WTO rules, fully fulfill its obligations under the WTO’s international treaties in good faith and avoid the abuse of trade remedies. At the same time, China reserves its full rights under the WTO dispute settlement mechanism and will take necessary measures to protect its legitimate rights and interests. Thank you.

RIA Novosti: How does the Chinese government view the participation of Chinese business in the reconstruction of Syria? Will you encourage Chinese companies’ cooperation in Syria? Thank you.

Gao Feng: Currently, the situation in Syria is entering a new phase. We believe that advancing reconstruction steadily is key guarantee for the country’s long-term peace and stability. The international community should pay high attention to and actively support Syria’s reconstruction.

Chinese business attaches great importance to commercial cooperation with Syria. In Aug. 2017, over 20 Chinese companies from energy, construction materials, auto, furniture, machinery and home appliances, among other sectors, took part in the 59th Damascus International Expo, which speaks to Chinese business’ keen interest in the Syrian market and strong desire for cooperation.

We encourage Chinese business to continue to strengthen exchanges with Syrian companies and explore their participation in Syrian reconstruction with necessary security precautions in place.

Yicai: the 2nd China-Chad Joint Economic and Trade Committee is said to have been held in Beijing. Could you brief on that and China-Chad commercial cooperation? Thank you.

Gao Feng: From Dec. 4th to 7th, the 2nd China-Chad Joint Economic and Trade Committee was held in Beijing. The two sides had consultations on the implementation of the ten major China-Africa cooperation plans and progress of key projects in bilateral commercial cooperation, among other topics of common interest. After the meeting, the two signed an inter-governmental economic and technical cooperation agreement and the minutes of the meeting.

Chad is China’s key partner for commercial cooperation in Central Africa. In recent years, bilateral cooperation in trade, investment, infrastructure and development aid has been fruitful. According to Chinese Customs, from Jan. to Sept. 2017, China-Chad trade reached US$ 300 million, up by 88.8% year-on-year. In breakdown, China’s imports valued at US$ 219 million, up by 140.5% year-on-year; China’s exports stood at US$ 81 million, up by 19.4% year-on-year. According to incomplete statistics, under the framework of the FOCAC Johannesburg Summit, as of Sept. 2017, China’s investment stock in Chad totaled around US$ 6 billion; Chinese companies had signed engineering contracts in Chad worth US$ 10.146 billion with a turnover of US$ 8.29 billion.

Following the principle of sincerity, real results, friendship, and good faith, China has conducted friendly cooperation with Chad in energy, communications, transport and infrastructure, effectively improving its infrastructure network. Projects of hospitals, boreholing and medical equipment, among others, conducted with Chinese assistance have significantly improved local living standards and local economic and social development, promoting the mutual benefit and win-win development of the two countries. Thank you.

[Global Times]: Canadian Prime Minister Trudeau visited China from December 3 to 7. What outcomes have been achieved? In particular, what progress has been made in a potential FTA?

[Gao Feng]: The complementary trade and economic links between China and Canada give us enormous potential and bright prospect for cooperation. During the visit of Prime Minster Trudeau, the two leaders reached important agreement on results-oriented commercial cooperation, global trade and investment liberalization and facilitation, as well as win-win development. The two sides also scored positive results in practical cooperation. For example, the two quality inspection authorities signed the MOU on Food Import and Export.

As to the FTA, the two sides announced the decision to conduct joint feasibility study and have explorative discussions in September 2016. This is almost completed after a year’s hard work.

During the visit of the prime minister, the two sides had friendly and in-depth consultations on the FTA. Both sides demonstrated the will to negotiate an FTA and made positive progress. China will always keep its door open. We believe a potential FTA will be useful for both sides. China is ready to work with the Canadian side in a pragmatic and open manner, so as to create the right conditions for the launch of FTA negotiations. Thank you.

[Phoenix TV]: The recent missile test in North Korea has prompted the US and other countries to consider more sanctions on it. What is China’s response? Will it cut off the oil supply? How is China-North Korea trade recently? Would you please give us the statistics for the first 11 months of this year?

[Gao Feng]: China has always enforced the resolutions of the UN Security Council in a comprehensive, accurate, conscientious and strict manner, as this is our international obligation. We will continue to work toward the denuclearization and peace and stability of the Korean peninsula. The Customs administration will release the statistics for the first 11 months soon. According to our statistics, in the first 10 months, China-North Korea trade was USD4.36 billion, down by 1.1%. Thank you.

We only have time for the last question.

[21st Century Economic Report]: The coal-to-gas program has led to a shortage of gas supply and rising prices in some areas. Could you share with us the information on China’s import of natural gas? It is predicted that China will import more LNG than pipeline gas and hit a record. How does MOFCOM view the market dynamics? What are your estimates for the gas import market going forward? Thank you.

[Gao Feng]: As China consumes an increasing volume of natural gas, imported gas has become one of the significant sources for our gas supply. According to China’s Customs, China imported 54.165 million tons of natural gas in the first 10 months of this year, up by 24.9%. In breakup, pipeline gas import was 25.073 million tons, up by 5.9%; LNG import was at the record high of 29.092 million tons, up by 47.7%.

China pays great attention to the supply of natural gas. We encourage businesses to increase domestic production and diversify import at the same time. LNG is an important form of our gas import. In recent years, growing domestic demand and improved infrastructure have driven the rapid growth of gas import. In the future, as the cross-border pipelines and coastal LNG stations are put into operation, China is likely to import natural gas with stronger capacity and at a higher level. Thank you.

This is the end of the press conference. Thank you.

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