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MOFCOM Regular Press Conference (September 1, 2022)

Shu Jueting: Friends from the press, good afternoon. Welcome to MOFCOM’s regular press conference. To start with, I have an announcement to make.

First, on China’s trade in services from January to July of this year

From January to July, China’s trade in services continued to grow steadily. The total imports and exports of services amounted to RMB3392.21 billion (RMB, same below), up 20.7% year-on-year. In breakdown, services exports registered RMB1642.24 billion, up 22.8%; imports RMB1749.97 billion, up 18.9%. Growth in services exports outpaced that in services imports by 3.9 percentage points, driving trade deficit in services down by 20.1% to RMB107.73 billion. In July, China’s service exports and imports totaled RMB499.9 billion, up 15.7% year-on-year. The main features are as follows.

Trade in knowledge-intensive services grew steadily. In the first seven months, the imports and exports of knowledge-intensive services amounted to RMB1418.07 billion, an increase of 10.2%. Among them, exports of knowledge-intensive services amounted to RMB795.47 billion, up 12.9%; areas with faster growth in exports were telecommunications computer and information services, and other commercial services, up 15.2% and 14% respectively. Knowledge-intensive services imports registered RMB622.6 billion, up 6.9%; the area with faster growth in exports was insurance services, with a growth rate of 77.2%.

The imports and exports of tourist services continued to recover. In the first seven months, China’s tourist services imports and exports stood at RMB462.23 billion, up 7.5%, with exports down 21.5% and imports up 10.8%. Excluding tourist services, China’s services imports and exports grew by 23.1% from January to July, with exports up 24.3% and imports up 21.8%; compared with the same period in 2019, service imports and exports grew by 51.5%, with exports up 66% and imports up 36.9%.

So much for the briefing. I’d like to take your questions. The floor is open.

Shanghai Securities News: The 2022 China International Fair for Trade in Services opened yesterday. After delivering remarks for two years in a row, President Xi Jinping sent a congratulatory letter to the 2022 CIFTIS yesterday. Going forward, what will MOFCOM do to put President Xi’s words into action?

Shu Jueting: President Xi Jinping delivered remarks at the Global Trade in Services Summit of the 2020 and 2021 CIFTIS and sent a congratulatory letter to this year’s CIFTIS. In his letter, President Xi Jinping points out that China stays committed to promoting high-quality development by high-level opening-up, broadening market access in the services sector, facilitating opening-up in cross-border services trade, expanding the function of opening-up platforms, and striving to establish a high-standard opening-up system for the services sector. His speeches and congratulatory letter charter the course for high-level opening up and high-quality development of service trade and show the world China’s strong confidence and determination in continuously promoting high-level opening up.

MOFCOM will implement in earnest the philosophy of President Xi Jinping’s important speeches and congratulatory letter, and continue to promote high-quality development of service trade. First, further opening up the market. We will promote the adoption of the negative list for cross-border trade in services nationwide, make good use of the major opportunities brought by the implementation of the RCEP and expand trade in services with RCEP members. We will take the opportunity of applying to join the CPTPP and DEPA to align with high-standard international economic and trade rules and enhance facilitation of cross-border flow of all types of factors. Second, strengthening development platforms. We will make sure all policy measures of pilot programs for fully deepening innovative development of trade in services deliver good results. We will establish national demonstration zones for innovative development of trade in services and create demonstration cities of service outsourcing of high quality. We will move ahead with quality improvement and upgrading of export bases of special services. Third, creating new growth models. We will expeditiously improve the top-level design for digital trade development. We will advance development of emerging trade in services such as bonded research and development, testing, art exhibition and transaction, among others. We will encourage imports of technologies and services related to energy saving, carbon reduction and environmental protection and export more green and low-carbon technologies. Fourth, deepening international cooperation. We will fully leverage the role of CIFTIS and other platforms to strengthen cooperation on trade in services with Belt and Road countries, BRICS countries and the SCO members to broaden China’s circle of friends in terms of trade in services. Thank you.

The Cover: As the Mid-Autumn Festival approaches, how is the situation with daily necessity supplies and how will MOFCOM guarantee supplies and stabilize prices during the holiday?

Shu Jueting: According to MOFCOM’s monitoring, current national supplies of daily necessities in the market are overall sufficient with slight price fluctuations. Last week (August 22-28), the wholesale prices of grain, pork, eggs and vegetables rose by 0.4%, 1.4%, 4% and 6.2% respectively, the prices of cooking oil and mutton remained unchanged, and the prices of beef and fruits fell by 0.6% and 2.2% compared with those of early August (August 1-7).

With the Mid-Autumn Festival just around the corner, MOFCOM will safeguard market supplies of daily necessities during the festival by focusing on the following aspects:

First, we will continue to strengthen monitoring of market operation. MOFCOM will keep a constant track of market operation of daily necessities in all localities, closely monitor the supplies and prices of main kinds of necessities such as grain, oil, meat, eggs and vegetables and strictly implement the system of timely reporting abnormal price fluctuations. We will pay special attention to sporadic COVID-19 outbreaks and unusual weather, monitor key regions in a daily and dynamic manner to have a timely understanding of the market situation and give prediction and early-warning.

Second, we will maintain market supplies during the festival with all our strength. Competent commercial departments in all localities are stepping up efforts to coordinate production and sales, enhance organization and coordination of supplies, smooth supply channels, guide commercial and trade circulation enterprises to increase their stock of daily necessities such as meat and vegetables in order to guarantee market supplies during the holiday. MOFCOM will work with other relevant departments to put central reserves of frozen pork, beef and mutton on the market in batches to increase meat supply.

Third, we will ensure emergency supplies. Competent departments of commerce at all levels will strengthen work shifts and security guarantee to address abnormal market fluctuations in an effective and proper manner and make sure that necessities won’t be sold out. MOFCOM will continuously follow the supply situation in regions hit by the COVID-19 outbreak and extreme weather, and respond timely through cross-regional allocation and joint mechanism for securing supplies, in order to maintain an overall stability in supplies and prices of daily necessities. Thank you.

CBN: Statistics show that the demand for consumer goods in Europe and the U.S. has been on the decrease, and U.S. retail inventories are higher than the those before the pandemic. Will this affect China's exports? Are emerging markets expected to become a new growth driver for China's exports?

Shu Jueting: Since the beginning of this year, China’s exports have demonstrated strong resilience in development. China’s exports from this January to July totaled at RMB 13.37 trillion, up 14.7%. Growth has been maintained in exports to major trading partners, including an increase of 19.7%, 15.1% and 19.1% to the EU, the U.S. and ASEAN respectively, and exports to countries along the Belt and Road and BRICS countries grew by 19.8% and 24.8% respectively. Our export markets have become more diversified. In the first seven months of this year, China's exports to emerging markets accounted for 52% of the total, up 2.5 percentage points from the whole of last year. Meanwhile, we’ve noted that with evolving global pandemic and rising uncertainties in world economic recovery, the growth prospects of major economies are not so optimistic, as we are seeing a lack of willingness to consume, slowed momentum in external demand expansion and greater difficulties for foreign trade enterprises to obtain orders.

Going forward, MOFCOM will continue to deepen market diversification, give full play to the Trade Fac。ilitation Working Group and other mechanism platforms. We will leverage the signed free trade agreements, continue to allow the Canton Fair, the China International Import Expo, the China International Fair for Trade in Services, the China International Fair for Investment and Trade, the China International Consumer Products Expo and other major exhibitions to play the role of platforms and guide enterprises to consolidate traditional markets and explore emerging markets. Thank you.

Economic Daily: Recently, many cities are investing in night-time economy and summer economy with rich activities to stimulate consumption. How does MOFCOM view the status quo of the consumer market? As the Mid-Autumn Festival and National Day holidays approach, what are the plans to promote holiday consumption?

Shu Jueting: In response to the decisions and deployment of the CPC Central Committee and the State Council for sustained recovery and upgrading of consumption, the Ministry of Commerce, in conjunction with local and relevant departments, has studied and introduced a series of policy initiatives to promote consumption, and organized various forms of promotion activities where epidemic control allows.

At present, the 2022 International Consumer Season, an initiative of MOFCOM, is in full swing. There are rich activities under different themes. At the national level, since the launch of the campaign in late July, we have successfully held the second China International Consumer Goods Expo and the first International Consumer Centers Forum, and carried out supportive activities such as the "Chinese Food Festival", the "100-city Auto Consumption Season" and the "Home Appliance Consumption Season". At the local level, there are special activities such as the "3rd Shanghai May 5th Shopping Festival" and the "2022 Shenzhen Shopping Season". From the sales of key retailers under MOFCOM monitoring, the consumer market continues to show a recovery trend since August.

In the next step, we will continue to organize a series of activities under the "2022 International Consumption Season", and will organize the "2022 (Autumn) National Consumption Promotion Month" in September and October, during the Mid-Autumn and National Day festivals. We will release the catalog of key activities, and continue to provide guidance to localities in effective coordination of epidemic control and consumption promotion. We aim to use the momentum of festivals to further restore and activate the consumption scenarios through digital empowerment, and the integration of commerce tourism, culture and sports. Thank you.

Reuters: On August 31, U.S. chip designer Nvidia said the U.S. government required it to stop selling two of its latest flagship GPU computing chips--the A100 and H100 chips--to China, which are used to accelerate artificial intelligence tasks. What’s the comment of MOFCOM? How will this move affect the operation of Chinese technology firms?

Shu Jueting: China has taken note of the development. For some time, the U.S.has been abusing export control measures to restrict the export of semiconductor-related items to China. China is strongly opposed to this. Such practices violate the principle of fair competition and international economic and trade rules. They will harm the legitimate rights and interests of not only Chinese enterprises, but also American ones. They will hinder international scientific and technological exchanges and economic and trade cooperation, and cause disruptions to global industrial chains and supply chains and the recovery of the world economy. The U.S. should immediately halt the wrong approach, treat enterprises of all countries, including Chinese enterprises, fairly and contribute positively to the stability of the world economy. Thank you.

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

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