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MOFCOM Regular Press Conference (January 12, 2023)

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

The floor is open.

China Business News: According to some analyses, China’s tourist services trade will recover faster in 2023, and China’s reopening will generate huge benefits for the global tourism sector. What is MOFCOM’s projection for tourist services in 2023?

Shu Jueting: Covid-19 has disrupted tourism in China and the rest of the world. In 2021, China’s total tourism trade was 789.76 billion yuan, down 22.5% year-on-year and equivalent to only 40.1% of that in 2019. Its share in China’s total trade in services decreased from 36% in 2019 to 14.9%. Since 2022, tourism in China has recovered. From January to November, 2022, total tourism trade was 758.05 billion yuan, up 8.2% year-on-year. According to the estimates of the UN World Tourism Organization, international tourism is expected to recover to 65% of the pre-pandemic level by the end of 2022.

China has for a long time been a major destination of inbound trips and source of outbound tourists, creating huge revenue for the global tourism sector. On January 8, China began to treat Covid-19 as a Class-B infectious disease, with optimized entry and exit policies. According to statistics, sales of plane tickets for some popular overseas tourist destinations have increased significantly, and bookings for overseas hotels have surged. At the same time, demand is increasing for inbound trips for sightseeing, visiting relatives and business. We are ready to work with all sides possible to create favorable conditions for safe and healthy international travels and contribute to global tourism growth and economic recovery. Thank you.

Phonenix TV: Recently, MOFCOM and the People's Bank of China (PBC) jointly released a notice to further support the expansion of cross-border use of the RMB and promote trade and investment facilitation. What are the main considerations for issuing the documents? How will MOFCOM help foreign economic and trade enterprises to use the RMB in cross-border trade and investment?

Shu Jueting: In recent days, MOFCOM and the PBC jointly issued the Notice on Further Supporting Foreign Economic and Trade Enterprises in Expanding the Cross-border Use of Renminbi to Facilitate Trade and Investment, which is mainly out of two considerations. First, it is based on the needs of enterprises. The RMB use in cross-border trade and investment can help foreign trade and economic enterprises to avoid exchange rate risks, manage capital costs and achieve stable operation. With the changes in the international economic and financial landscape, the exchange rate of major currencies have experienced more fluctuations. As a result, enterprises are more willing to use the RMB for transactions and settlements, and there is a greater demand for cross-border RMB investment, financing and risk management. Second, the work has a good foundation. In recent years, with the active promotion of related departments, the cross-border use of the RMB has steadily increased. In 2022, cross-border RMB settlements for trade in goods reached RMB7.92 trillion, up 37.3% from a year ago. Cross-border RMB settlements for direct investment expanded 16.6% year-on-year to RMB6.76 trillion last year. Facing the new landscape and new demands, there is much room for improvement in both the proportion of RMB use in cross-border trade and investment and the enterprises' sense of gains in cross-border RMB businesses.

Based on a review of previous work, the Notice focuses on better meeting the needs of enterprises. Nine targeted measures with the following features are put forward. First, service supply is increased. We support banks in actively launching new financial products of cross-border RMB, and providing more convenient and efficient services for settlements and financing. This will help better meet different needs in foreign trade, investment, contracted projects, etc. Second, resources are coordinated. We will give better play to the supporting role of capitals, funds and export credit insurance based on open platforms such as pilot free trade zones, free trade ports and overseas trade and economic cooperation parks. Third, all kinds of subjects are taken into consideration. Customized measures for high-quality enterprises, newly-registered enterprises, SMEs, etc. are encouraged to enhance their sense of gains. Core enterprises in supply chains are supported to better play a leading role. Fourth, cooperation and linkage are highlighted. We will provide guidance for related local departments and financial institutions to strengthen their cooperation and promote connection among cities, counties and districts in order to ensure effective implementation of policies.

In the next step, MOFCOM will work with the PBC to implement the Notice, guide local government departments and financial institutions to formulate detailed measures and adopt targeted measures based on specific conditions. We will promote local governments to report the needs of enterprises in a timely manner, work for financial institutions to continuously improve the supply of products and services and enable better matching between banks and enterprises. We will carry out policy communication in various forms and timely summarize and promote experiences and practices.

In recent search, we found that some SMEs have limited understanding and use of cross-border RMB business. In view of this, MOFCOM and the PBC specially organized financial institutions to compile and publish a manual of cross-border RMB service for SMEs. In the manual, the main cross-border RMB policies are reviewed, and related businesses and typical cases in different scenarios are introduced. Enterprises are welcome to look it up on MOFCOM’s official website or WeChat official account. Thank you.

China News Agency: Over the past three years, Covid has had a great impact on the confidence of foreign trade enterprises in the future. Will foreign trade improve obviously after the optimization of Covid response? What aspects will the MOFCOM consider to boost the confidence of foreign trade enterprises? How to further help them attend overseas exhibitions and engage in negotiations?

Shu Jueting: Over the past three years, changes in the world have evolved at a faster pace, the once-in-a-century pandemic has had far-reaching effects, and the international economic and trade environment has been turbulent. Facing the complicated and severe development environment, under the strong leadership of the CPC Central Committee and the State Council, all local governments, departments and foreign trade enterprises have met obstacles and difficulties head on and made concerted efforts. China's foreign trade has withstood the test of major risks and shown strong resilience and vitality. China's total imports and exports exceeded USD5 trillion and USD6 trillion consecutively in 2021, and are expected to attain new heights in 2022.

At present, the greatest pressure on the stable growth of foreign trade comes from rising global economic recession risks and continuous slowdown in external demand. Some sectors are facing weak demand and sluggish orders. Recently, many localities actively organized foreign trade companies to go global and bring overseas businesses in. The implementation of a host of trade promotion measures has greatly boosted foreign trade companies’ access to and confidence in markets and orders. Companies are travelling in groups on charter flights to attend fairs, visit customers, and explore cooperation, embracing overseas markets and invigorating the foreign trade circle as the new year unfolds. Companies monitored by MOFCOM are showing positive signals. Especially, major exporting provinces are reporting improving orders.

At the same time, it remains a daunting task to stabilize trade and improve its quality. MOFCOM will continue to watch closely and strengthen support for stable trade volume and optimized trade mix. The focus will be on the following areas.

First, we will stabilize foreign trade orders. Overseas commercial counselor’s sections and offices will be leveraged to promote trade and support foreign trade companies in attending overseas fairs and business matchmaking. We will encourage micro, small and medium enterprises to attend overseas fairs in various ways, stage successful key expos like the Canton Fair and work harder to attract overseas purchasers. We will guide companies to make full and good use of export credit insurance so that they are more confident in taking up orders.

Second, we will secure foreign trade entities. We will work with localities and relevant authorities to guide companies to make use of generally preferential policies, such as inclusive finance and pro-employment measures. The role of financial institutions will be tapped into to strengthen credit support for foreign trade companies, especially MSMEs.

Third, we will help businesses solve difficulties. Related working mechanisms to stabilize foreign trade will be fully leveraged to follow and resolve the difficulties facing enterprises and create a more favorable environment for business development. Thank you.

Economic Information Daily: Recently, 14 departments, including MOFCOM, identified 9 regions as pilots for the integration of domestic and foreign trade. What will be the focus of these 9 pilots and what role will they play in advancing the integration?

Shu Jueting: To promote the integration of domestic and foreign trade is a major decision of the CPC Central Committee and the State Council. As a key measure of implementation, the pilot for the integration of domestic and foreign trade aims to promote the reform and innovation of key areas and links and form replicable and scalable experience and models for nationwide demonstration and spillover. Following the review of a panel of experts and public notice, 14 departments, including MOFCOM, identified 9 regions as pilots for the integration of domestic and foreign trade, namely, Beijing, Shanghai, Jiangsu, Zhejiang, Fujian, Hunan, Guangdong, Chongqing, and Xinjiang.

For the next steps, the pilots will revolve around ‘five batches’ in their related work. To be specific, they will foster a batch of enterprises integrating domestic and foreign trade in their operations; build a batch of development platforms integrating domestic and foreign trade; cultivating a batch of industrial clusters with international competitiveness and integrated development; address a batch of real-life problems facing market entities integrating domestic and foreign trade; and form a batch of replicable and scalable experience and models to establish and perfect institutions and mechanisms for integrating domestic and foreign trade. MOFCOM will work with related departments to strengthen guidance for the pilot work, and summarize experience in a timely manner for nationwide rollout, so as to promote the efficient integration of domestic and foreign trade and better serve the new development paradigm. Thank you.

The Cover: As the epidemic prevention and control measures keep getting optimized and adjusted, personnel exchanges between the Chinese Mainland, Hong Kong and Macao have become more convenient. How will MOFCOM encourage economic and trade cooperation between the Chinese Mainland, Hong Kong and Macao, actively promote a high-quality building of Guangdong-Hong Kong-Macao GBA and improve trade and investment liberalization and facilitation between the Chinese Mainland, Hong Kong and Macao?

Shu Jueting: MOFCOM has been fully and accurately implementing the principle of “One China, Two Systems”, actively promoting economic and trade exchange and cooperation between the Chinese Mainland, Hong Kong and Macao, and continuously expanding the mainland’s opening up to the two SARs. In the new journey, we will earnestly implement the spirits of the 20th National Congress of the CPC to fully support Hong Kong and Macao to develop their economies, improve people’s livelihoods, solve deep-rooted contradictions and problems encountered during social-economic development to get better aligned to the bigger picture of China’s national development.

First, make steady progress in building a single free trade zone (FTZ) between the Chinese Mainland, Hong Kong and Macao. We will work with the governments of the Hong Kong and Macao SARs to improve the institutional system of Closer Economic Partnership Arrangement signed between the mainland, Hong Kong and Macao, and steadily advance consultations on jointly building a single FTZ among the three to enhance trade and investment liberalization and facilitation, and promote efficient and convenient flow of factors across the mainland, Hong Kong and Macao.

Second, actively participate in the building of Guangdong-Hong Kong-Macao GBA. We will accelerate the implementation of policies and measures supporting the GBA building in the commercial field and support the GBA in enhancing market integration and fostering a world-class business environment.

Third, vigorously support Hong Kong and Macao to play more significant roles in building a new development pattern with their unique strength. We will continue to support Hong Kong and Macao in jointly building platforms under the “Belt and Road” Initiative, and implement the memorandum of understanding between MOFCOM and the Hong Kong SAR government on enhancing exchanges and cooperation in promoting high-quality development of overseas Economic and Trade Cooperation Zones. In the meantime, we will support Hong Kong and Macao in conducting more open and closer exchanges and cooperation with other countries and regions, support Hong Kong in joining the RCEP at an early date, negotiating and signing free trade agreements with other economies to expand regional economic cooperation.

Shu Jueting: Any other question? If you have no question to ask, the conference is concluded. Thank you all.

(All information published on this website is authentic in Chinese. English is provided for reference only.)