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MOFCOM Regular Press Conference (July 14, 2022)

Shu Jueting: Friends from the press, good afternoon. Welcome to MOFCOM’s regular press conference. Since I don’t have announcements to make today, we can directly proceed to the Q&A session.

The floor is now open.

21st Century Business Herald: What’s MOFCOM’s comment on China’s foreign trade figures in the first half of this year? Going forward, what will MOFCOM do to promote the steady development of higher-quality foreign trade?

Shu Jueting: Since the beginning of this year, MOFCOM has been resolutely implementing the decisions and plans of the CPC Central Committee and the State Council and following the requirements on preventing COVID-19, stabilizing the economy and ensuring secure development. Putting stability front and center and seeking progress while maintaining stability, MOFCOM worked together with local governments and line ministries to introduce, in a timely manner, policies and measures to keep industrial and supply chains stable and smooth for foreign trade, and help foreign trade enterprises secure orders, expand market and get more competitive internationally. With the concerted efforts of all parties, China’s foreign trade demonstrated resilience in development in the first half of this year despite the adverse impact of multiple factors at home and abroad.

First, trade figures hit record highs. Total imports and exports amounted to RMB19.8 trillion, up 9.4% on the large base in the same period last year. To break this down, total imports and exports as well as total exports alone hit monthly record highs in June. Exports of the Yangtze River Delta rebounded rapidly, growing 9.3% in the first half of this year. China remains the world’s largest trader in goods, with the share of its exports on the international market reaching 14.1%, roughly the same level as in the same period last year.

Second, the structure and quality improved. China’s exports to emerging markets accounted for 51.8%, up 2 percentage points compared with the same period last year. The imports and exports of private enterprises increased by 13.6% and accounted for 49.6% of the total, up 1.9 percentage points. The competitiveness of a number of high-tech, high-value-added products leading green transformation continued to increase.

Third, foreign trade made greater contribution to the national economy. In the first half of this year, net goods export registered RMB2.48 trillion, a year-on-year increase of 57.5%, giving a strong boost to GDP growth and contributing to a consolidated foundation for economic recovery and the efforts to keep major economic indicators within an appropriate range. The number of importers and exporters reached 506,000, a year-on-year increase of 5.5%. Foreign trade played a bigger role in keeping the operations of market entities stable, promoting employment stability and ensuring people’s livelihood.

In the second half of this year, China’s foreign trade development will still face a number of uncertainties and instabilities. MOFCOM will work together with local governments and related government departments to keep implementing policies and measures to stabilize foreign trade and ensure that enterprises be informed of and have access to everything they are entitled to know and enjoy. We will focus on four aspects to realize the goal of guaranteed stability and improved quality. 

First, we will stabilize foreign trade entities by cutting costs and boosting efficiency. The connections among governments, banks and businesses will be strengthened to guide precision lending by financial institutions and cut business financing costs. Export tax rebates will be accelerated to reduce the financial burden on businesses. Guidance will be strengthened for matching shipping space supply with demand to reduce shipping costs.

Second, we will stabilize foreign trade production and circulation by strengthening guarantee. Working mechanisms for stabilizing foreign trade and keeping logistics open will be fully tapped to step up guarantee for the production and circulation of foreign trade companies and unclog chokepoints, with a view to reducing importing and exporting costs.

Third, we will help businesses develop markets by securing orders. The Working Group on Unimpeded Trade will be leveraged and signed FTAs tapped to guide companies to develop international markets in an targeted way. Continuous efforts will be made to ensure the success of the CIIE, Canton Fair, CIFTIS and CIFIT, among other international expos and guide localities and industry associations to develop a host of online country, professional and specialty shows.

Fourth, we will foster new drivers for foreign trade through innovation. We encourage innovative, green and high value-added products to develop international markets. New business types and models such as cross-border e-commerce, overseas warehouse, market procurement, foreign trade comprehensive service, bonded maintenance and remanufacturing will be strengthened continuously. Digital trade, green trade and related market entities will also be fostered expeditiously. Thank you.

Phoenix Satellite TV: It’s reported that US Treasury Secretary Yellen discussed capping Russian oil prices during her video conference with Vice Premier Liu He. What’s MOFCOM’s comment?

Shu Jueting: We have noted related reporting. At present, soaring oil prices are one of the major factors pushing up global inflation and a major concern of the international community. On July 5, Vice Premier Liu He had a video conference with Treasury Secretary Yellen as agreed, where the US side explained its idea of capping the oil prices of related countries. China believes that the issue is very complex. The premise for its settlement is for related parties to urge peace and facilitate talks so as to deescalate rather than escalate the Ukraine crisis, which is in the interests of all sides. Thank you.

The Cover: Statistics issued by the National Bureau of Statistics show that CPI was up 2.5% in June. In particular, pork prices registered a strong momentum of growth. According to MOFCOM, what is pork supply like in the market? Do you have some monitoring data? What measures will MOFCOM take to ensure pork supply and stabilize prices?

Shu Jueting: Since mid-June, due to multiple factors, pork prices have risen, but remain in the reasonable range. As of the end of May, there were 41.92 million breeding sows on hand in the country, with sufficient market supplies. MOFCOM will work with related departments to take active measures to ensure pork supply and stabilize prices. First, we will continue to step up monitoring of meat markets and publish supply-demand and price information in a timely manner to stabilize market expectations and maintain steady market operation. Second, with reference to market situation, we will leverage pork reserves to stabilize the pork market. Third, we will guide areas affected by Covid and flood to better connect production with selling, boost market supply and make sure that consumer demand for meat is met. Thank you.

MASTV: Australian Foreign Minister Penny Wong recently said that to improve China-Australia relations, China should remove “trade blockages” it has imposed on Australia, and that Australia would stay say in China’s interests. Since 2020, Australia has been “complaining” about China’s trade restrictions on Australian exports such as meat and lumber, and Canberra has filed complaints at the WTO about Chinese anti-dumping duties on Australian wine and barley. What’s MOFCOM’s response to Australia’s “demands”?

Shu Jueting: A steady and healthy political relationship meets the fundamental interests and shared wishes of both peoples. It is also inducive to peace, stability and prosperity in the Asia Pacific region. It is hoped that Australia could learn from the past and adopt a future-oriented approach, move in the same direction as China with concrete actions and with mutual respect and mutual benefit in mind, and create favorable conditions for the sound and steady development of bilateral trade and economic relations.

As for the trade remedy cases you mentioned, China’s trade remedy measures have always been in compliance with WTO rules, Chinese laws and regulations and common international practices. Thank you.

Economic Daily: The policy package to stabilize economy released by the State Council includes “support for the development of county-level commerce”. What progress has been made in strengthening county-level commerce and boosting rural consumption? What are the next steps?

Shu Jueting: China’s countries are home to around 740 million people. Townships and villages account for 38% of the whole domestic consumption market. Strengthening county-level commercial system is a major component of all-round rural revitalization.

This year, MOFCOM, the Ministry of Finance and the National Rural Revitalization Administration jointly launched the County-level Commerce Development Campaign, to support local authorities in bolstering weak rural commercial facilities and expanding coverage of e-commerce. In the first half of this year, 69 county-level logistics distribution centers and village convenience stores were built or renovated. Local authorities, through experiment and innovation, have produced several good practices. For instance, Jiangsu Province listed renovation of township farmers’ markets in its “solid work for the people” program, turning 79 old markets brand-new. Some markets even have food courts and leisure areas to offer a better shopping experience. Chongqing Municipality explored new models such as postal-express delivery cooperation and public transport-express delivery cooperation, and pooled resources for logistics distribution centers and smart distribution warehouses, reducing labor cost by about 40%.

In the next stage, MOFCOM and other relevant authorities will intensify efforts in guiding local governments to repair weak links in infrastructure and public services and improve the county-level commercial system, with lower-tier channel expansion as the central task, counties and townships as the focus, and digitization, chain operation and standardization as the main approaches.

First, accelerate digital transformation. We will encourage traditional rural commercial businesses to expand online and offline sales channels and create new consumption patterns and scenarios. We will push for integration of e-commerce with leisure agriculture and rural tourism to promote industrial development and increase farmers’ income through digital empowerment.

Second, facilitate chain operation. We will instruct large chain distribution companies to expand lower-tier markets. We will upgrade a batch of county comprehensive commercial service centers, township commercial centers and village convenience stores and grow multiple types of business including shopping, catering and recreation, which will attract urban consumption in rural areas and rural consumption in counties.

Third, enhance standardization. With an emphasis on high-quality development, we will encourage consumer goods, home appliances and furniture brands to extend their supply chains to lower-tier markets and provide such services as direct supply, direct selling, centralized purchase and joint delivery, to increase high-quality supply and make high-quality consumption a shared experience among both urban and rural residents. Thank you.

China News Service: We know that China and Nicaragua recently signed the early harvest arrangements for a bilateral free trade agreement (FTA), and started the negotiation of the China-Nicaragua FTA. Could you elaborate on that?

Shu Jueting: Since the resumption of diplomatic relations between China and Nicaragua in December last year, under the personal commitment and guidance of the leaders of the two countries, the two sides have made joint efforts to efficiently promote bilateral economic cooperation and trade in various fields and achieved fruitful and pragmatic outcomes. From January to May this year, trade between China and Nicaragua continued to grow, with Nicaragua's export to China increasing by 128.9% year-on-year, fully demonstrating the dividend of the resumption of diplomatic relations. On July 12, Wang Wentao, Minister of Commerce, and Nicaraguan Foreign Minister Denis Moncada, representing their respective government, signed the Early Harvest Arrangement for the Free Trade Agreement between the Government of the People's Republic of China and the Government of the Republic of Nicaragua via video link, another important achievement of bilateral economic cooperation and trade since the resumption of diplomatic relations between China and Nicaragua. The early harvest arrangement mainly covers tariff concession of trade in goods, among others. After the arrangement comes into effect, China and Nicaragua will offer zero tariff on some products originated in the other side, which will benefit the people and companies of the two countries at an early date.

While signing the early harvest arrangement, Minister Wang Wentao and Minister Denis Moncada also announced the beginning of FTA negotiations between China and Nicaragua and stated that they would strive to complete the process as soon as possible. China and Nicaragua have strong economic complementarities and great potential for trade and investment cooperation. The signing of FTA between China and Nicaragua is conducive to further deepening economic cooperation and trade between the two countries, creating a new vista in economic relations and trade between China and Nicaragua, and laying a solid foundation and adding impetus to the sustainable development of bilateral relations.

In the next step, China stands ready to work with Nicaragua to complete their respective domestic legal procedures and other follow-up work at an early date, and promote the implementation of the early harvest arrangement as soon as possible, so that the two countries and their peoples get to benefit from them at an early date. Taking the opportunity of the negotiations and signing of FTA between China and Nicaragua, we will make every effort to elevate China-Nicaragua economic cooperation and trade to a new level. Thank you.

Economic Information Daily: The Ministry of Commerce has put forward that, this year, more cities will be added to the comprehensive pilot program for service sector opening in an orderly manner, and a number of pilot measures that fit the changing circumstances will be introduced. How about the progress now? What are the achievements and outcomes of the previous pilot programs?

Shu Jueting: The comprehensive pilot program on further opening up the service sector is an important arrangement made by the CPC Central Committee and the State Council to promote high-level opening up. Up till now, seven years of continuous innovation and exploration have been carried out, forming a "1+4" demonstration pilot pattern in Beijing, Tianjin, Shanghai, Hainan, Chongqing and other provinces and cities. Seven groups of 35 cases sharing experience have been rolled out to the whole country, including the opening up of industries, cultivation of new business forms, trade and investment facilitation, reforms of systems and mechanisms, which have accumulated experience and explored the path for the opening up of service sector nationwide. From January to May, 2022, the paid-in foreign investment in the service sector in the above pilot areas was USD23.1 billion, a year-on-year increase of 24.5%, accounting for 35.1% of the paid-in foreign investment in the service sector across the whole country. This has increasingly played a leading and exemplary role for the opening up and development of the service sector nationwide.

In April this year, in the keynote speech at the Opening Ceremony of the Boao Forum for Asia Annual Conference, President Xi Jinping proposed that China will add more cities to the comprehensive pilot program for service sector opening. This year's Report on the Work of the Government also set clear requirements for this. According to the decisions and arrangements of the CPC Central Committee and the State Council, the Ministry of Commerce is promoting the work on adding more cities to the pilot program in an orderly manner, and working with relevant departments to study and put forward new pilot measures, expand high-level opening up, and improve the development level of the service sector. At the same time, we will continue to promote the pilot programs in the five existing provinces and cities, timely summarize innovation achievements, and replicate and apply them nationwide. Thank you.

Zhejiang Daily: Considering the social turmoils in Sri Lanka, does MOFCOM have any suggestions or comments on Chinese businesses in Sri Lanka and commercial cooperation with Sri Lanka?

Shu Jueting: China and Sri Lanka have been friendly neighbors with years of friendly trade and economic cooperation, marked by the Rubber-Rice Agreement of 1952.

With regard to the difficulties in Sri Lanka, China will provide as much help as our capability allows to support economic recovery and people’s livelihoods in Sri Lanka. China is willing to maintain close contact with Sri Lanka to jointly respond to challenges and move forward healthy and steady bilateral trade and economic cooperation.

Yicai: This year marks the 5th anniversary of the CIIE. We learned that some exhibitors have been invited to the CIIE promotional events in different localities. Could you give us a briefing?

Shu Jueting: The CIIE has been successfully held for four years, playing an important role as a platform for international procurement, investment promotion, cultural exchanges, and open cooperation. In order to amplify the spillover effect of the CIIE, MOFCOM has held a series of promotional events from 2021 under the theme “boosting dual circulation by introducing more foreign investment”, aimed at helping more FIEs learn more about China and invest and prosper in the Chinese market. The first two stops were Sichuan and Liaoning.

To bolster investment promotion, we will bring the CIIE to Jiangxi from 23 to 26 of July this year. It will be an opportunity for the exhibitors, related agencies, experts and scholars to discuss and promote the competitive industries of Jiangxi. The main activity will be a thematic promotion and investment match making event, coupled with side events such as exhibitions, dialogues, seminars, and on-site tours. The promotional event will be held in a hybrid format. Businesses will be matched in a targeted manner to meet the needs of all participants. We will also hold a Hongqiao Forum in Jiangxi, which will bring together experts and scholars to contribute their insights for local development. The preparations for these events are well underway. Thank you.

China Daily: The government of Uruguay has recently announced the completion of joint feasibility studies of an FTA with China, and the plan to launch formal negotiations shortly. Can MOFCOM confirm this news? What are China’s comments on cooperation with MERCOSUR?

Shu Jueting: China pays close attention to free trade relationship with Uruguay. Since the joint FTA feasibility study was launched last September, the two teams have been working closely and moving forward the studies with solid steps. The joint feasibility has been completed. The two sides will maintain active communication to discuss the next steps that can enhance the bilateral trade and economic cooperation.

We are open to negotiating FTAs with other members of MERCOSUR or with MERCOSUR as a whole. China is willing to deepen win-win cooperation with MERCOSUR members in various ways, including through FTAs. Thank you.

Shu Jueting: Any more questions? If not, this is the end of the press conference. Thank you.

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