Gao Feng: Members of the press, good afternoon. Welcome to MOFCOM’s routine press conference. Today, I have two pieces of information to release to you.
Gao Feng: I. China’s absorption of foreign investment in January-November 2018
In January-November, China’s absorption of foreign investment mainly showed the following features:
1.The actual use of foreign investment kept steady in general.
In January-November, 54,703 foreign invested companies were newly established, with an increase of 77.5% year on year; the actual use of foreign capital reached 793.27 billion yuan, decreasing by 1.3% year on year (equivalent to US$121.26 billion, up 1.1% year on year).
In November, 5,158 foreign invested companies were newly established, with an increase of 11.1% year on year; the actual use of foreign capital reached 92.11 billion yuan, decreasing by 26.3% year on year (equivalent to US$13.6 billion, down 27.6% year on year), mainly because the cardinal number of the same period last year was large.
2.The high-tech manufacturing industry maintained rapid growth.
In January-November, The actual use of foreign capital of manufacturing reached 241.02 billion yuan, up 16% year on year. The actual use of foreign investment of the hi-tech manufacturing industry reached 78.13 billion yuan, increasing by 30.2% year on year. Among these, the actual use of foreign capital in electronic and communication device manufacturing, medical instruments and instrumentation industry and computer and office equipment manufacturing and increased by 36.4%, 132.5% and 112.7% respectively year on year.
3.The absorption of foreign investment in the middle and western regions increased, and the growth rate of the pilot free trade zone overpassed that of the whole country.
In January-November, the actual use of foreign investment of the middle regions reached 56.64 billion yuan, up 8.7% year on year. The actual use of foreign capital of the western regions was 54.45 billion yuan, up 17.4% year on year. The number of the newly established foreign invested companies’ pilot free trade zones reached 8,569, up 34.6% year on year, and their actual use of foreign capital increased by 10.4% year on year, taking up 12.7%.
4.The main sources of investment maintained the growth trend.
In January-November, among the main investment sources, the investment in China from Singapore, South Korea, the UK, Japan, the US and German increased by 7.4%, 38.7%, 198.9%, 20.1%, 3.7% and 30.2% respectively year on year. The actual input value from the countries along the Belt and Road routes, ASEAN and EU increased by 14.9%, 15.7% and 16.1% year on year respectively.
II About China’s Foreign Trade Operation in January-November This Year
In January-November this year, China's import and export maintained the rapid growth, the structure continued to optimize, the transformation of growth drivers was accelerated, the quality and efficiency continued to improve, and the stable development was further consolidated. According to the statistics from Chinese Customs, from January to November, China's total import and export volume was 27.88 trillion yuan, up 11.1% year on year. Among these, the exports were 14.92 trillion yuan, up 8.2% year on year; the imports were 12.96 trillion yuan, up 14.6%; the trade surplus was 1.96 trillion yuan, narrowing by 21.1%.
In terms of the layout of the international market, while the traditional market is being consolidated, the exports to emerging and developing markets have maintained the rapid growth. From January to November, China’s exports to ASEAN and BRICS countries increased by 12% and 10.5% respectively, 3.8 percentage points and 2.3 percentage points higher than the overall export growth rate. The imports and exports of the countries along the Belt and Road routes increased by 14.4%, 3.3 percentage points higher than the overall growth rate and accounted for 27.3% of the total foreign trade volume, up 0.8 percentage points.
In terms of the layout of domestic regions, the exports of the central and western regions increased by 16% and the imports by 18%, accounting for 17% of the total exports volume and 14.5% of the total imports volume, up 1.1 and 0.5 percentage points respectively. The exports and imports the eastern regions increased by 6.7% and 14.1% respectively, accounting for 83% of the total exports volume and 85.5% of the total imports volume respectively.
In terms of business entities, the exports of private enterprises were 7.16 trillion yuan, up 11.6% and accounted for 47.9%, up 1.2 percentage points, continuing to be the largest business entities regarding exports. The exports of state-owned enterprises were 1.54 trillion yuan, up 8.6%. The exports of foreign-invested enterprises were 6.22 trillion yuan, up 4.4%.
In terms of commodity structure, in January-November, the exports of mechanical and electrical products reached 8.76 trillion yuan, up 9.2% and accounted for 58.7%, up 0.6 percentage points. Among these, the exports of integrated circuits, automobiles and chassises, and mobile phones and parts increased by 25.9%, 9.7% and 12.4% respectively. The added value of the exports of mechanical and electrical products such as ships, integrated circuits, motors and generators and computers and accessories further increased, and their export unit prices increased by 17.2%, 17.1%, 10.4% and 9.7% respectively. The exports of seven major labor-intensive products such as clothing and toys reached 2.85 trillion yuan, up 1.5%.
In terms of trade mode, in January-November, the exports of general trade reached 8.4 trillion yuan, up 12% and accounted for 56.3%, up 1.9 percentage points. The exports of processing trade reached 4.78 trillion yuan, up 3.6%.
In terms of the new forms of foreign trade, the business environment for developing new forms of foreign trade has continued to improve. Cross-border e-commerce and market procurement trade have continued to maintain rapid growth this year on the basis of rapid growth for two consecutive years, becoming the new highlight in foreign trade growth.
In terms of imports, in January-November, China's imports increased by 14.6% and the contribution rate to import and export growth was 60.8%, becoming an important driving force for foreign trade growth this year. Among these, the imports of mechanical and electrical products reached 5.88 trillion yuan, up 12.7%, driving the total import volume by 5.1 percentage points. In terms of bulk commodity imports, in January-November, 10 categories of bulk commodities such as crude oil, natural gas and coal all together drove imports by 4.2 percentage points, in which the imports of crude oil and natural gas increased by 8.4% and 33.8%.
The above are messages I want to release and now I’d like to answer the questions from the media.
China News Service: We have noticed that China and the EU have recently signed an agreement on the WTO case about poultry TRQ. Could you brief us on that?
Gao Feng: As for the case you mentioned, in April 2015, China requested consultations with the European Union regarding measures to modify the European Union tariff concessions on certain poultry meat products, officially starting the dispute settlement procedure under the WTO. In April 2017, the WTO decided that the European Union's allocation of TRQ shares among supplying countries was inconsistent with WTO rules. In order to implement the decisions above, China and the EU conducted multiple rounds of negotiations on allocating new tariff rate quotas on imports of poultry meat products from China in a friendly and cooperative spirit. On November 30, 2018, China and the EU signed an agreement in Geneva, properly addressing the implementation of the ruling and achieving a mutually-beneficial and win-win result. According to the agreement, the EU agrees to grant new tariff rate quotas on imports of poultry meat products from China, including 6,600 tons of duck meat under country-specific quota and 5,000 tons of chicken meat under global quota.
China welcomes the signing of the agreement in the end and appreciates the cooperative attitude shown by the EU during the negotiations. This case is an important measure by China to safeguard the interests of domestic industries through the WTO dispute settlement mechanism and a successful example of China working with other members to address trade disputes under the WTO framework. It fully reflects the important role played by the WTO dispute settlement mechanism in safeguarding the legitimate rights and interests of members and the important positive role played by the multilateral trading system in maintaining the international trading order. Thank you.
Reuters: In a recent interview by Reuters with President Trump of the US, President Trump said that he believed that China will soon lower the tariffs on automobiles imported from the US to 15% and the US will not impose new tariffs on Chinese products before China and the US reached an agreement on trade. Could MOFCOM confirm what was said by the US President or does MOFCOM have any comment on that? Also, according to the coverage of our US colleagues, China has already started to buy US soybeans. Does China plan to continue to buy the large amount of soybeans mentioned by President Trump?
Gao Feng: As for the first question, China and the US have already reached consensus on specific issues, such as agricultural produce, energy and automobile. More details will gradually be released.
For the second question, soybean has always been an important variety of agricultural produce that China imports from the US and China has a huge market demand. I will give timely updates if there are more details. Thank you.
21st Century Business Herald: On December 6, MOFCOM hosted the 2018 Symposium on Trade Remedies and Industrial Development in Beijing. Could you brief on the contents of the event and the trade frictions involving China this year?
Gao Feng: The annual Symposium on Trade Remedies and Industrial Development aims to review and summarize China’s annual work on trade remedies, analyze the trends of trade remedies and industrial development and hear opinion and suggestions offered by participants on conducting trade remedy investigations according to laws and regulations and the implementation of trade remedy measures.
China is faced with complex and daunting trade frictions this year. In the first eleven months of this year, Chinese products have encountered 101 trade remedy investigations initiated by 28 countries and regions, including 57 anti-dumping cases, 29 on countervailing and 15 on safeguard measures, involving USD 32.4 billion. Compared with the same period last year, the number of cases and the amount of money involved increased by 38% and 108% respectively.
On industries, steel, chemical and construction materials are the industries with larger number of cases and amount of money involved. On countries, the US, India, Canada and Australia are the countries that have launched a larger number of trade remedy investigations against Chinese products.
China always believe that trade remedy measures should be used under restraint and with caution within reasonable limits, under the prerequisite that they are consistent with WTO rules, so as to safeguard the stable trade order and fair competition. Under the framework of WTO rules, China will firmly safeguard the legitimate rights and interests of domestic industries according to Chinese laws. We also hope to enhance communication and coordination with other WTO members to promote industrial cooperation, appropriately resolve contradictions and differences through dialogue and consultation, jointly safeguard global free trade order and multilateral trading system and advance the sustainable growth of global economy and trade. Thank you.
Bloomberg: Earlier this week MOFCOM announced on its website that Vice Premier Liu He had a telephone conference with US officials on trade matters. What specific topics were discussed? Could you share more details? Does China plan to send a delegation to the US? Who will be in the delegation and when will they set off?
Gao Feng: Regarding the first question, on 11 December, Vice Premier Liu He had a phone call with the US colleagues to exchange views on the timetable and road map of the trade consultation. The two teams have maintained close contact as to the details of the consultation and there have been smooth progress. Should there be further details, I will provide the update. On the second question, the two teams are in close contact. China welcomes the US delegation to China, and is open to sending a delegation to the US as well. Thank you.
CBN TV: In November, China’s foreign trade data declined markedly, with total import and export growing a mere 9.1% year on year, less than half that of October. What is the main reason? Some believe this is the result of less export rush ahead of the potential tariff imposition. How do you view it? Will the foreign trade growth continue to decelerate?
Gao Feng: As I said, China’s total import and export reached RMB27.88 trillion in the first 11 months of this year, up by 9.1% year on year and surpassing the whole of last year. The steady and positive momentum of foreign trade is further strengthened. When we estimate the trend of foreign trade, we take a holistic view on the import and export over a certain period. Fluctuations in individual months do not represent a reverse of the general trend. As you said, import and export both decelerated in November from October. According to China Customs, in November, China’s export grew by 10.2% year on year, two percentage points higher than the average in the first 11 months, which suggests steady momentum for growth. The import grew by 7.8%, 6.8 percentage points lower than the average in the first 11 months, with import of most commodities on the decline. But the general trend is that China’s foreign trade remains steady and positive development. This gives us full confidence in the high-quality development of foreign trade. Thank you.
AFP: After Ms. Meng was arrested in Canada, two Canadians were arrested in China. Is that a kind of retaliation? Will it impact the trade and economic relations between China and Canada or the trade war between China and the US?
Gao Feng: My colleague at the Ministry of Foreign Affairs has made China’s position clear regarding the question you raised. Thank you.
CBN Daily: On 12 December, China and the EU and other related parties submitted the joint proposals on WTO reform to the General Council for discussion. How is the discussion going? Will there be consensus on the reform for the next step? What are the sticking points?
Gao Feng: On 12 December, the WTO General Council held discussions on the two joint proposals from China and the EU and other Members for the reform of the appellate procedures of the dispute settlement mechanism. At the Council, the signatories released a joint statement that underlines the core value and significance of the dispute settlement mechanism, expresses strong concerns over the continued vacancy of the seats at the appellate body, and calls on all Members to immediately discuss and adopt the suggestions in the proposals, so as to launch the selection process as soon as possible and fill in the vacancy.
41 Members made interventions on this topic at the Council. All parties believed that the deadlock of the appellate body selection must be broken and the appointment must be disconnected from other issues; that the joint proposals from China and the EU and other Members are constructive and responsive to the concerns of certain Member over the appellate procedure and could serve as a basis for further discussion.
It is the common responsibility and interests of all Members to safeguard the dispute settlement mechanism and the multilateral trading system. China calls for active participation, constructive cooperation, and proactive and pragmatic actions of all Members to solve the crisis facing the appellate body, restore the normal function of the dispute settlement mechanism, and maintain the authority and efficacy of the multilateral trading system. China expects all WTO Members to push this work forward. Thank you.
China Daily: The share of trade in services in the world trade is increasing. China has long emphasized promoting growth in trade in services and building a brand for services in China. From the signing of the MOU on international services trade cooperation to regional trade negotiations, it is plain to see the importance attached by China to services trade. What measures will MOFCOM take to further boost development of services trade and what areas will be prioritized?
Gao Feng: Giving priority to services trade is an important measure to foster economic transformation and upgrading and pursue high quality development. Thanks to the blessing of the CPC Central Committee and the State Council, we have made positive progress since the beginning of this year in pilot schemes of innovative growth in services trade, cultural exports, and international cooperation at bilateral and multilateral forums.
Going forward, we will focus on the following aspects.
First, we will move faster with pilot and model programs and improve policy mechanisms. Pilot programs will be pushed forward in the 17 locations where six opening up and facilitating measures and 34 policies in eight pillars in such areas as finance, telecommunications and tourism will be implemented. Efforts will be made to select model cities for services outsourcing industry. We will unleash the driving forces of the model cities through dynamic adjustment.
Second, we will further expand cultural exports. On the basis of successful experience, we will study and issue new supporting policies and measures to expand exports of Chinese culture.
Third, we will grow digital services trade by creating platforms and policy environment for digital trade in services, boost exports of digital services, and push forward the digitization process of trade in services.
Fourth, we will move faster with transformation and upgrading of services outsourcing by new policies and measures so that China’s services outsourcing industry can move towards the direction of high technology, high value-added and high returns.
With respect to priority areas in the future, we will timely revise and publish the catalogue for the guidance of key areas of services export, the catalogue for encouraged services export, and the catalogue for the guidance of key areas of services outsourcing. Export of emerging services underpinned by digital technology is among the catalogue. You can continue to follow the development. Thank you.
This is the end of today’s conference. Thank you.