On September 26, the Information Office of MOFCOM held the Press Conference of Electronic Commerce. Yao Jian, MOFCOM spokesman, Li Jinqi, Director of Department of Electronic Commerce and Informatizaiton, and Sun Yao, Deputy Director of Beijing Municipal Commission of Commerce were present and answered questions.

Yao Jian: Good Morning! Welcome to the Press Conference today. I am the spokesman Yao Jian. Today, Li Jinqi, Director of Department of Electronic Commerce and Informatizaiton, Sun Yao, Deputy Director of Beijing Municipal Commission of Commerce, and I, will introduce you the overall development of e-commerce and key projects on e-commerce carried out by MOFCOM and Beijing Municipal Commission of Commerce, and answer questions you concerned.

Firstly, I will introduce you the overall development of China’s e-commerce.

I. The overall development of China’s e-commerce

China’s e-commerce has developed rapidly in recent years, and has affected every field of social and economic life. It has become the new channel for enterprises to broaden domestic and foreign markets, reduce operating costs and enhance circulation efficiency, new choice for consumption, and new measure for government to stimulate domestic demand, develop economy and optimize the industrial structure. In 2012, driven by government, enterprises and consumers, the total volume of China’s e-commerce trade reached 8.0163 trillion RMB, up by 31.7% year-on-year. Among that, the volume of online retail sales was over 1.3 trillion RMB, up by 67.5% year-on-year, taking up 6.3% of total retail sales of consumer goods in 2012. By the end of 2012, there had been 62 of top 100 circulation enterprises carrying out online retail. At the first half year of 2013, though the growth of China’s retail industry slowed down, online retail was still well-developed. According to the statistics, the total volume of China’s online retail in the first half year of 2013 was over 0,88 trillion RMB, up by 70% year-on-year.

Driven by the wide application of e-commerce, e-commerce service industry developed quickly. In 2012, the total revenue of e-commerce service industry was over 0.2 trillion RMB, becoming the important impetus of economic structure adjustment and transformation of development mode, and one of the main ways of employment promotion. Besides, e-commerce breaks the barrier of time, space and areas, integrates information, capital and material, broadens circulation channel, improves circulation efficiency, and reduces circulation costs, so that e-commerce promotes the formation of the great circulation and great market, which are unified, standard, and faithful.

II. Main features of the development of China’s e-commerce in recent years

1. Online shopping popularized in large areas, and sales volume grew dramatically. In 2012, the sales volume of China’s online retail market reached 1.3110 trillion RMB, with a growth rate of about 4.7 times that of the total retail sales of social consumer goods, and more than 20 times over the total volume of online retail in 2007, 56.1 billion RMB. China’s status in the field of International e-commerce was obviously promoted.

2. To combat the impact of online market, traditional commercial enterprises strengthen their efforts to e-commerce transition. The rapid development of e-commerce impacted traditional commercial enterprises remarkably. Driven by the transition of retail mode, like Suning and Gome, even more traditional commercial enterprises swarmed into e-commerce.

3. E-service industry begins to take shape, and e-commerce environment is improved. Headed by e-commerce trade service, e- service like logistics, payment, security credit certification and software development has taken shape. E-service industry is a new business model, and will promote the transformation of development mode. The overall environment of e-commerce is further improved.

4. Cross-border e-commerce has become a new development hot spot. With its rapid growth, e-commerce puts forward new requirements to the platforms, logistics, account settlement, customs declaration, and commodity inspection, which has attracted the governments’ high attention. Model innovation has become the new growth point of cross-border e-commerce. Platform enterprises has been over 5 thousand, and enterprises which carry out cross-border e-commerce through different kinds of platforms inside China has been over 200 thousand. In 2012, the trade volume of China’s cross-border e-commerce has reached 2 trillion RMB.

5. New generation of Internet technology has driven e-commerce to a new high. Cloud computing has become the necessary network infrastructure to develop e-commerce. At the same time, main e-commerce platforms took advantage of bulk data techniques to conduct precise marketing, exploring new consumer demands, to further improve consumers’ service experience. Besides, mobile e-commerce has also become the new focus of competition of main e-commerce platforms, and APP based on intelligent terminal has become the standard configuration of e-commerce
platforms.

6. E-commerce demonstration projects led by the government gained initial achievements. “National E-commerce Demonstration city” set by MOFCOM and NDRC, “National E-commerce Demonstration Base” and “E-commerce Demonstration Enterprise” set by MOFCOM, have formed a relatively integrate e-commerce demonstration system, which plays a favorable demonstration effect in creating development environment, promotingthe application of innovation, guiding enterprises clustering, and promoting balanced development.

III. Development trend of China’s e-commerce

China’s e-commerce starts late and compared with developed countries, there is still a big gap, but driven by government, enterprises, and consumers, China’s e-commerce will gain a more rapid development in a further standardized environment. The development is reflected in the following four aspects:

1.The integration of real economy and internet economy becomes the development direction of e-commerce. The application of e-commerce in China’s industrial and agricultural production, commerce circulation, tourism and community services is broadening and deepening. The pattern of integration of online and offline, like marketing online and deal offline, or experience offline and purchase online is being formed at a high speed. The development of enterprises supply chain, e-commerce and international e-commerce will drive the development of e-service, which is gradually becoming the new growth point of national economy.

2. Technology, demand and investment give impetus to the rapid development of e-commerce. Driven by new round of information technological revolution, such as cloud computing, Internet of Things and mobile communication, e-commerce is continuously creating new applicationpatterns, and newly-developing patterns based on mobile internet, online community, LBS springs up. Changes in China’s social structure and consumption concepts will bring new development space for e-commerce, and the younger generation will become the main force of consumption. Support system of e-commerce is further improved and the endogenous power of e-commerce is continuously strengthened.

3. Cross-border e-commerce has become a new choice for China’s enterprises seeking overseas business opportunities. With the gradual perfection of China’s cross-border e-commerce policies and institution and driven by e-services, cross-border e-commerce will continue to take advantage of products made in China, promote the transition from “Made in China” to “Marketing in China” and “Created in China”.

4. E-commerce is expanding. Supply chain and commerce cooperation level of large-scale enterprises are continuously improved, and middle and small-sized enterprises actively integrate in e-commerce purchase and sale system of leading enterprises. E-commerce will integrate logistics supply chain, effectively binding channels of logistics, business and information. Besides, marketing will be more precise. By the online consumption of each consumer, e-commerce platforms will estimate the consumer’s real demand, so that to recommend products precisely.

Above, I briefly introduced relevant information. Next, Li Jinqi, Director of Department of Electronic Commerce and Informatizaiton, will introduce you the key projects carried out by MOFCOM in e-commerce.

Li Jinqi: Good morning! Just now, the spokesman made an introduction on the overall development, main features and development trend of China’s e-commerce, helping us understand the current situation and trend of China’s e-commerce. In recent years, with the rapid and changeable development of e-commerce, in accordance with the decision and deploy of the Party Central Committee and the State Council, and starting from the actual facts of e-commerce, MOFCOM keeps exploring and innovating at work, strengthens the guidance of policies, improves development environment, and promoting demonstration, and gains positive achievements. Next, I will exchange and share with you the key projects carried out by MOFCOM in e-commerce.

I. Overall assessment on online retail in China

In recent years, with the popularization of internet and e-commerce, online retail is rapidly growing. The main features are as follows:

1. Size of shoppers and retail Online are further expanding. In 2012, the trade volume of China’s online retail reached 1.31 trillion RMB, up by 67.5% year-on-year, taking up 6.3 of the total retail sales of consumer goods. According to CNNIC, the number of new-added online shoppers in the first half year is 28.89 million, and 271 million in total.

2. The enterprises pay more attention to business online; e-commerce gets more popular. By the end of 2012, 32% of the enterprises have begun to purchase or sell products online. Among China’s top 100 chain enterprises, 62 of them have carried on sales online and the online shops have exceeded 70.

3. The retail goods online cover a wide range of varieties; the market structure gets more optimization. Products online cover almost all the social retail goods. The most popular products online are clothing, footwear and headwear, general merchandise and digital applicance successively. On the sales model, B2C model’s advantages in commodity quality and service guarantee gradually stand out and its proporation in online sales also gets further improved. According to the statistics by relevant researches, the B2C turnover in 2012 accounted for 29.7% of the total retail sales online, up by 4.4% compared with that in 2011. The enterprises are becoming the mainstream sellers in sales online.

II. E-commerce demonstration and its effect

To explore ways that can play an exemplary and leading role in e-commerce industry, Ministry of Commerce, joined efforts with National Development and Reform Commission to develop a nationwide “e-commerce demonstration cities”. 22 cities were selected for “e-commerce demonstration”for their good development environment, large enterprises’ demand and positive support from the local governments. They are prior to carry and try many measures to endeaver to solve contradictions and problems existing in the development of e-commerce, and make great achievements in creating good environments for e-commerce development and pushing positive exploration of innovation application in some key and characteristic areas.The selction of the second round of “e-commerce demonstration cities” has started by now.

Meanwhile, to intensify local innovative e-commerce policy and create a good environment for the development of e-commerce regionally, Ministry of Commerce launched “National base for e-commerce demonstration”to develop 34 demonstration bases. They integrated social service resources, innovated public service model, gained certain advantages in improving the information basic environment and enterprises’ cluster and innovative ability, played an exemplary and leading role in e-commerce service sector development, traditional e-commerce application and the transformation and upgrading of traditional industry, and contributed a lot to the balanced development of e-commerce.

Since 2010, Ministry of Commerce has began to develop “e-commerce demonstration enterprises”, which has developed the online retailing platforms, e-commerce platforms and e-commerce demonstration enterprises to play its exemplary and leading role in innovating operation and service model, reducing business cost, integrating business resources, opening up markets, and stimulating the consumption, so as to lead the enterprises to improve their competitiveness by the use of e-commerce and form a e-commerce demonstration system including cities, bases and enterprises.
　　
III. Situation of cross-border e-commerce and relevant measures

With the wide application of Internet and rapid development of foreign trade, cross-border e-commerce grew fastly. To vigorously develop China’s e-commerce is of great significance to improve the opening economy and enhance its sustainable and sound development.

On the basis of the present development trend of e-commerce as well as researches on current situation and problems of cross-border e-commerce, Ministry of Commerce followed the instruction of State Council, actively organized relevant departments of State Council to solve problems relating to the mechanism that limits e-commerce’s development and broke the bottleneck restricting e-commerce development. To solve the problems on customs clearance, commodity inspection, foreign exchange settlement, tax rebates and statistics, we drafted relevant documents to support the retail and export in cross-border e-commerce. Opinions on Implementing Policies to Support Retail and Export in Cross-Border E-commerce formulated by Ministry of Commerce, which is disseminated by State Council and made out by 9 departments including Ministry of Commerce, National Reform and Development Commission, the People’s Bank of China and General Administration of Customs, etc., integrates the retail and export in cross-border e-commerce into the trade statistics by Customs and proposes policies to support cross-border e-commerce as well as 6 concrete measures relating to export inspection, and foreign exchange collection/settlement. These measures have been carried out in Shanghai, Hangzhou, Ningbo, Chongqing and Zhengzhou. And they will be promoted widely in other cities that meet the conditions around the country on October 1.
　　
IV. Situation of e-commerce in Agro-product and relevant measures

In recent years, the e-commerce of agro-foodstuff in China grew fastly and tens of thousands of agricultural websites were set up. In 2012, more than 260 thousand shops specialized in agro-foodstuff in taobao. Their sales volume amounted to RMB19.9 billion. Many agro-foodstuff service companies, retailers and wholesalers like AP88.com, Xinjiang Guoye and Caiguanjia (962360.com) stand out and they played a positive role in reducing the circulation cost and improving circulation efficiency.

Ministry of Commerce placed the development of e-commerce in agro-product as key tasks, encouraged the innovation and transformation of traditional agro-foodstuff circulation enterprises, developed online retail and wholesale of fresh agro-foodstuff by combination of the off-line model, and pushed up a multi-circulation pattern that mainly depends on farmers-retailers model, grows towards farmers-supermarkets model, and also connects the door-to-door sale and online sale.Meanwhile, to solve the problem of agro-foodstuff’s “hard to sell”for the lack of supply-demand information, Ministry of Commerce set up new countryside’s business website and, joined efforts with education center of the Organization Department of CPC Central Committee to carry on the countryside business information service pilot in 203 counties among 27 provinces nationwide. More than 22 million tons agro-foodstuff were sold and the turnover exceeded RMB81 billion after information release, consultations and docking service. Besides, Ministry of Commerce also built up “an autonomic docking platform for the production and sales of agro-foodstuff”, which has been put into operation and an emergency mechanism when they are “hard to sell”.
　　
V. Work for the next step

E-commerce is a strong power to lead the circulation revolution and push the economic transformation and upgrading. Ministry of Commerce will further clarify the strategic position of e-commerce, insist on principles of “to regulate in its development, to promote the development by regulation”, strengthen the guidance and support, positively enhance the improvement of regulation and policy environment, innovate public service and strive to occupy the commanding heights in the new circulation revolution.

First, try to establish policy environment beneficial to e-commerce development. We’ll deepen communication with relevant departments, push relevant departments to set up the supervision and service mechanism adapting to e-commerce development, make efforts to solve the problem relating to the mechanism that restricts the e-commerce development and work out the e-commerce promotion policies.

Second, promote the e-commerce development pragmatically. We’ll encourage the innovative development of e-commerce enterprises, regulate the development of online sales and intensify the e-commerce relating to city community and agro-foodstuff; to develop cross-border e-commerce and make out specified policy measures; to quicken the development of e-commerce in service sector and promote balanced development around different regions; to push up e-commerce demonstration projects, advance the exemplary role model innovation, products innovation, technology innovation and system innovation play in different areas and intensify the vigor of Internet market.

Third, increase the support and protection of e-commerce. We are to innovate the public service of e-commerce and guide e-commerce park to build a public service platform; to build an e-commerce credit evaluation system and push up an information sharing mechanism of cross-department law enforcement; to improve the evaluation system of e-commerce statistics and quicken to build national and provincial e-commerce platform of statistics analysis; and to build an e-commerce training center to strengthen talents training and reserve.

Fourth, make perfect e-commerce laws and regulations. To set up a general regulation framework of e-commerce timely and actively, promote relevant departments to amend relevant laws and regulations; to start to draw up e-commerce promotion laws, positively push to issue the Third Party Trading Platform Management for Online Retail and The Online Commercial Data Protection Measures and regulate the market order.

Fifth, intensify the establishment of e-commerce standard system. To do researches and work out a series of standards and regulations regarding the e-commerce market’s main body, objects, main parts and different areas. Meanwhile, we’ll also stress the propaganda and training work of e-commerce standards, intensify the implementation of standards, improve its efficiency and lead e-commerce to develop in a sound and orderly way.

Yao Jin: Thank you Mr. Li Jinqi. Next, let’s welcome Mr. Sun Rao to introduce us the e-commerce development in Beijing.

Sun Rao: Good morning, dear friends. First, I’d like to extend my sincere appreciation to Ministry of Commerce and friends from the media for your attentions and support. Then, I’ll take this opportunity to introduce the e-commerce promotion work in Beijing in recent years as follows:

The first part is about E-commerce development in Beijing. E-commerce in Beijing has achieved rapid development in recent years, with the following features:

Firstly, E-commerce has is a new engine to stimulate consumption growth in Beijing. The growth rate of online retail sales ranks the top of all industries in Beijing. According to statistics by Beijing Bureau of Statistics, online retail sales of enterprises above designated sizes reached 59.68 billion yuan in 2012, accounting for 7.75% of the total retail sales of social consumer goods. In January to July 2013, online retail sales exceeded 50 billion yuan, accounting for over 10% of retail sales of social consumer goods for 6 consecutive months, reaching 10.8% and nearly 11%, and contributing 44.5% of the retail sales of social consumer goods.

Second, Beijing takes the lead in impact of e-commerce in urban areas. According to the Report on Impact of E-commerce in Urban Areas in China (2012), Beijing ranks the top in 22 demonstration cities of E-commerce in attractiveness of society, economy, technologies and policy environmental policy. In 2012, among the top 9 national private B2C companies, five companies from Beijing including Jingdong Mall, Amazon China, Dangdang, Gome and VANCL are on the list, with the total transaction value accounting for 67.1% of the national total. In B2B, the international influence of Dunhuang network and HC net has been increasingly strengthened.

Third, the support system for e-commerce has become increasingly strong. Beijing has a safe and efficient, flexible and convenient support system for e-commerce, with complete functions. In security certification, eight organizations have obtained permits on electronic authentication services, accounting for 25% of the national total, and ranking the top in China. In online payment, 53 enterprises have obtained license for payment services of non-financial institutions, accounting for 21.2%, ranking the top in the country. In credit services, an enterprise credit network has opened to the public providing credit inquiry services, and has built a unified platform for enterprise credit monitoring and integrated services. In logistics services, promoting co-terminus distribution services in E-commerce, and over 160 distribution outlets in communities and universities have been built, providing match-making services for 36 enterprises in E-commerce and other services, with daily distribution volume of 30,000 units.

Fourth, the development of clustered areas has play a positive role. Beijing has two state-level E-commerce demonstration bases including Tongzhou Business Park and Beijing Economic and Technological Development Zone in Daxing District, four featured buildings for E-commerce including Yonghe Plaza in Dongcheng District, Block A of Sinoocean International Center in Chaoyang District, Qidi Technology Building in Haidian District and Ruida Building in Shijingshan District, creating conditions for promoting cluster development of E-commerce. Currently, Tongzhou Business Park has attracted 32 featured E-commerce enterprises including Leyou and Vancs; over 200 enterprises, with annual sales of 50 billion yuan; the said four featured buildings have a total floor area of 370,000 square meters, with 411 enterprises, of which enterprises in E-commerce accounted for 45%.

II. Measures to promote E-commerce development

First, the Opinions of the Beijing Municipal People's Government on Promoting the Sound Development of E-commerce was issued, specifying 26 key tasks including developing online sales, promoting pilot project of E-invoice and cross-border e-commerce, supporting application of mobile E-commerce, nurturing E-commerce for agricultural products in communities, and establishing a safe and efficient financial services system.

Second, a working mechanism to promote E-commerce was established. Beijing Municipal Commission of Commerce has worked with other 20 departments including Beijing Municipal Development and Reform Commission, Beijing Administration for Industry and Commerce, Beijing Municipal Office of SAT and Beijing Customs to establish a mechanism to promote E-commerce in Beijing, joining efforts to improve the environment for E-commerce development, and making efforts to solve the bottlenecks for E-commerce development in Beijing.

Third, policies breakthroughs were made for E-commerce development in key areas. The Municipal Commerce Department has worked with other 11 departments including Beijing Municipal Office of SAT, Beijing Administration for Industry and Commerce, Beijing Taxation Bureau, Beijing Municipal Development and Reform Commission and Beijing Municipal Financial Bureau to establish a pilot working mechanism to promote e-invoice and cross-border e-commerce, and a working plan has been formulated to comprehensively promote the pilot work. On June 27, Beijing Municipal Department of Commerce joined with Beijing Municipal Office of SAT, Beijing Municipal Taxation Bureau and Beijing Administration for Industry and Commerce to publish a bulletin on application of e-invoice. E-invoice is an effective means to strengthen tax collection and invoice management and improve energy conservation and remission reduction, and will greatly reduce costs of paper invoice for E-commerce enterprises, and will improve business efficiency. The success of the pilot e-invoice marks a breakthrough to optimize the environment for e-commerce development, and will further enhance the attractiveness of e-commerce. Meanwhile, cross-border e-commerce has also made a progress, as of September 10, the first batch of pilot enterprises in cross-border e-commerce has shipped 35 e-invoices for exports, with the value of US$ 150 thousand, and covering over 20 destinations.

Fourth, the development of e-commerce service platform was enhanced. Special funds were allocated for a number of third-party e-commerce trading platforms and information service platforms projects including the collaborative platform for industrial chain, overseas sales platform for MSMEs and bulk commodity trading platform, and promoted the development of e-commerce services in Beijing.

Fifth, urban joint distribution services were promoted in e-commerce. The urban joint distribution pilot programs were carried out, and regional and standardized distribution has been achieved in the last-mile logistics by establishing joint distribution sites in communities and universities, and integrating the demands and resources of terminal logistics based on the information management platform, enhancing the capabilities for logistics services were, and providing a safe and convenient delivery services for the residents.

III.Work of the next step

Continuously improve Beijing’s e-commerce development environment, and promote the industrial development. By year 2015, realize the goals that the volume of Beijing’s e-commerce trade is over 1 trillion RMB and online retail sales takes up 15% of the total retail sales.

1. Deeply advance the pilot work of electronic invoice. Further improve the service platform and technical manual of e-invoice, and realizethe whole category coverage of e-invoice of pilot enterprises and opening the service platform to all kinds of e-commerce enterprises, expanding the pilot enterprises as soon as possible.

2. Promote cross-border e-commerce. Set up and improve the information platform of cross-border e-commerce, innovate operating process and supervision patterns, and help enterprises explore international markets.

3. Further optimize e-commerce development environment. Carry out the division of labor of the Suggestions, and strengthen departmental cooperation. Study and Formulate relevant industrial standards, improve rights protection online and supervision standards, establish credible trading system, improve talents guarantee mechanism, to create a sound industrial environment.

Yao Jian: Thank Deputy Director Sun Yao. Next, please ask questions concerning the conference today.

CCTV-2 (financial channel): Mr. Sun, E-commerce in Beijing is so advanced, and now it will be October soon; we see in your description that the cross-border E-commerce will be promoted focally in the next step, could you tell us whether there are any specific arrangements and projects?

Sun Yao: Firstly, Beijing has set up a task team, the Beijing Municipal Commission of Commerce and Beijing Customs took the lead to establish the coordination body, consisting of Beijing Municipal Commission of Commerce, Beijing Customs, Beijing Entry-Exit Inspection and Quarantine Bureau, Beijing Municipal Office SAT, Beijing Office of the State Administration of Foreign Exchange and Beijing Tianzhu Comprehensive Free Trade Zone. Secondly, we rely on the policies of the special customs supervision zone in the Beijing Tianzhu Comprehensive Free Trade Zone and select the Jingdong Mall and EMS as the pilot enterprises. At the previous stage, we were exploring and testing the supervision mode for procedure and all respects of the cross-border E-commerce. Now, we basically figure out a route through the test and exploration in the previous period; in the next step, we intend to establish a public information platform of cross-border E-commerce to share the information from the Customs, Inspection and Quarantine, taxation, foreign exchange, E-commerce enterprises and commercial departments and, build a public service platform for the cross-border E-commerce, and perfect the services for the E-commerce enterprises on that basis, so as to promote the development of the cross-border E-commerce. Meanwhile, we are considering and expanding the scope of pilot enterprises so as to further promote the pilot works of the cross-border E-commerce.

Economic Information Daily: Director-general Li, as you described the current situation of the development of the E-commerce of agricultural products just now, you said that the current development is still very fast now, but we notice that some problems still emerge in the process of the development of the E-commerce of agricultural products; someone proposes that “it seems very good”; could you tell us the bottlenecks of the development of the E-commerce of agricultural products and the concrete measures to be taken by the Ministry of Commerce in the future. As we know, the Ministry of Commerce is studying the policies and measures related to the import of cross-border E-commerce now. Could you disclose the progress and idea in this aspect?

Li Jinqi: The agricultural products are the issues that the leaders of the Central Party Committee and the State Council pay close attention to, and the issues of agriculture, farmer and rural area are always mentioned in the “Document No.1” annually. Because China is a developing country, for example, the development in the central and western regions and rural areas is very unbalanced. Due to particularity and policy of agricultural products circulation and imperfect infrastructures, some problems have emerged in purchase and sales of agricultural products. Now some specific difficulties appear in the development of agricultural products; first, in terms of quality standard system of agricultural products, the products, such as potato which is relatively easy to guarantee the quality, have better quality standard system, but the products, such as leafy vegetables, have many problems in terms of standard, storage and transportation; such non-standardization causes some problems in the aspects of storage and transportation; second, the logistics distribution system of agricultural products needs improvement, especially the logistics of cold chain that relatively lag behind; third, the social credit system is not complete. There are many problems, such as traditional transaction practices, lack of specialized personnel, etc. Because the payment system by using the credit card is not so popularized in the vast countryside yet, it is basically cash transaction. Food safety is also an important factor of restricting the development of agricultural products, embodying in three aspects of quality standard system, logistics system and social credit system.

According to the unified deployment of the State Council, the Ministry of Commerce treats support of the E-commerce of agricultural products as an important job. Recently, Premier Wang Yang instructed the development of E-commerce of agricultural products is a strategic commanding point. The Ministry of Commerce, from this point of view, has strengthened the research and made overall plans, and when taking some relevant measures, has streamlined the logistic process to make the sales of agricultural products realize leapfrog development through E-commerce. On the one hand, the farmers cannot sell the products at a favorable price; on the other hand, the prices of vegetables in the cities are very expensive, and the "vegetable basket" is a very big problem to the city, the reason of which is that the overlapped logistic processes caused the high price. The farmers’ vegetables always are sold at very low prices, but the vegetables are very expensive after arriving cities. We solve the problem of these two links through E-commerce to reach a final target that the farmers can sell their products at good prices, and at the same time the residents in cities can buy vegetables at cheaper prices.

Specially, first, to strengthen the establishment of rules and regulations and standardization of the E-commerce of agricultural products, accelerate the establishment of laws and regulations of E-commerce, and standardize the services in the aspects of information issue, online transaction, credit service, e-payment, logistics distribution, dispute resolution and others. As I just introduced, the Ministry of Commerce has established a new rural business network to solve the information asymmetry problems of the farmers. The production by the farmers is often blind since they do not know the demand of the whole country. It is known that the agricultural products may encounter "the year of excessive supply or demand "; that is, the agricultural products will be sold at low prices if it’s cultivated more this year, and will be sold at good prices if it’s cultivated less next year. Some agriculture-related enterprises may connect the information about the field of the farmers with the demand of the enterprises fully through network, and finally can place orders to the farmers directly, which means that the enterprises guide the farmers to produce and cultivate products as required, so as to realize the order-based agriculture. Finally, insisting on standardization, we establish the standard for agricultural products in short supply as soon as possible to promote the standardization of quality and package, standardization of package and marking and branding of products effectively.

Second, to strengthen the support of the distribution, and optimize the development environment. To accelerate the establishment of socialized logistics system of urban and rural integration; the director-general Yao introduced just now that the big data significantly drive the E-commerce. Big data processing can realize the integration of logistics, the reduction of idle carrying capacity, the decrease of cost, the improvement of efficiency, and optimization of the planning layout of such logistics facilities as distribution centers. To encourage the development of professional and scaled third-party logistics, and focus on support of the development of the cold chain logistics of agricultural products so as to promote the coordinative development of such services as, payment credit, finance, insurance, inspection, certification, statistics and talent training.

Third, to vigorously popularize the application of the rural E-commerce. The present development of the mobile E-commerce has enriched the rural market significantly; China will launch 4G. Although the network support conditions for rural remote and mountain areas are limited, the farmers can grasp the information in time by use of intelligent mobile phones and embedded software thanks to the mobile internet. We greatly promote the rural E-commerce application, guide much more social funds to invest in the E-commerce of agricultural products, encourage the traditional agricultural product wholesales market to carry out various forms of transactions, including E-commerce, select some agricultural product wholesales markets and large-scale comprehensive products transaction websites with strong industry force, good information base, perfect networked e-transaction system and distinct economic benefits to summarize and promote the on-line and off-line integrated development; and the on-line retail of agricultural products on the basis of the community retail outlet is also the key point to be promoted, in order to popularize the on-line wholesales of agricultural products and bulk commodities transaction scale timely.

Fourth, to organize and launch the rural commercial information service thoroughly. The rural commercial information service encounters the “last one-kilometer" problem, which is a great restriction factor due to the limited network conditions in rural areas. In order to popularize the Party member education, the Central Organization Department has set up distance education network of the Party members in 620,000 administrative villages in the whole country to promote the Party member education, which is a very typical example of resource integration. In cooperation with the Party Member Education Center of the Central Organization Department, the Ministry of Commerce, via the distance education network of the Party members, transfers the information to each village. The college-graduate village officials in the villages are responsible for the organizational activities of the Party member education, by which the information may be uploaded so as to popularize our network to all rural areas in the whole country in timely and quickly manners and at low input of expenditure. At present, the pilot counties has already increased to 203 from 70 in number, which will be popularized in the whole country as soon as possible on the basis of summarization.
On this basis, we also plan to construct a national agricultural product public information platform based on the new rural business network. I have already mentioned just now that previously the only information about the field of the farmers is uploaded to this network; everybody knows what they have planted, and how they sell. Next, some agriculture-related enterprises and social organizations will be included in the network to solve the problem of farmers’ information asymmetry, and guide the farmers to produce and sell their products at better prices.

Next, the government department will expand the scope of information service, perfect and standardize the service system, and integrate some social resources in the department (the cooperation with the Central Organization Department is a very good example), to make the rural information service of the Ministry of Commerce more comprehensive and the role bigger, so as to realize the normalization of purchases and sales of agricultural products finally. We have also discuss about promoting the enterprises to utilize the market to implement the entity transaction on the network, which maybe involve some standard problems; if these problems can be solved, the entity transaction on the network can reduce the links in the rural markets, so as to obtain more benefits.

As for the issue of cross-border e-commerce, because this issue was also asked on some other occasions, someone said the central government had already started the business, and asked if there are pilots; actually, the answer is no. Since the issues restricting the cross-border E-commerce are mainly the policy bottleneck, for example, customs clearance, settlement of exchange and refund of tax. so long as these issues can be solved, the generalized system of preferences will be implemented in the whole country. In light of the indicative spirits of the leaders of the State Council, we confirm that in the whole country the areas with necessary conditions can implement relevant policies from October 1. So long as the issue is put forward by this area, the local relevant departments may be organized to discuss the same jointly; due to the uniqueness of the E-commerce, this job cannot be promoted only by the commercial departments, but needs coordination and cooperation with other relevant departments. For example, the economic information department, development and reform department, industrial and commercial administrative departments, and quality inspection department shall cooperate with each other closely to form one force; in the locality, some departments are sent and stationed by the central authorities. So in the pilot places, these departments can be coordinated to study the policy bottleneck, and the enterprises can be encouraged to put forward the problems; as for the problems that can be solved by local government, the local government shall solve these problems, and as for the problems which the local government cannot solve, these problems shall be solved by the central authorities; if these policy problems can be the solved, the whole country can enjoy these policies. The date of October 1 is a nodal point. The pilot is actively being promoted and tested in the whole country. The problems are being concentrated, arranged and studied, and we will monitor the situations in time in this process, and research and solve the problems together with relevant departments actively.

China News Service: Director-general Yao, as at present the network sales of fake products and frauds are still incessant after repeated prohibitions, could you tell what measures will be taken by the Ministry of Commerce to further standardize the E-commerce to suppress the swindle and fake products sales on the network?

Yao Jian: as introduced before, the E-commerce is developing very fast; for example, the network retails have increased by more than 70% for the first half of this year. The industry and the regulators both reckon that E-commerce faces the greatest challenge and restriction factors, i.e. the absence of credit system, the supervision, so the counterfeiting, sales of fakes and fraud on the network retails are more serious now. As the Director-general Sun talked about just now, by 2015, the scale of network retail will be further expanded, which will account for 15% of the social consumer goods retail of Beijing. We estimate that the E-commerce in the whole country will also develop at high speed. Failure to solve the above-mentioned problem will absolutely influence the development of the industry.
As a department of the State Council, the Ministry of Commerce is responsible for the routine works of the national leading group of attacking infringement and counterfeiting. We take the lead, with several departments to jointly govern the behaviors of producing and selling the counterfeits and shoddy products and infringement of the intellectual property rights in the society. The key works in three aspects have been launched from the beginning of this year: first, we have attacked the behavior of selling the counterfeit and shoddy products through Internet; second, we have attacked the network infringement and pirates (related to the intellectual property protection), supervised the famous video websites and key network enterprises, and further strengthened the efforts for the intellectual property protection of network music, game and entertainment market; third, we have launched special rectification of the illegal websites of commodity transaction actively; some websites are illegal and not affirmed by the supervision department. Since May of this year, the Ministry of Public Security specially organized public security organs of 18 provinces and cities to specially strike counterfeit medicines. Relevant departments have also investigated and treated the websites displaying the infringing and pirating audio-visual products and fake news media.

At present, the two factors restraining the development of the E-commerce, especially network retails, are the security of information technology and the lack of network credit environment. People are worried about the former and concerned about the latter. Now, consumers complain about such several aspects as long time delivery time, inconformity between actual object and website propaganda, existence of counterfeit and shoddy products in the sales, obstruction in return of goods, imperfect after-sale services and others, which all are factors influencing the whole network retail environment. Next, the Ministry of Commerce will further advance this job together with related departments to solve the problems restraining the network retails.

International Business Daily: I have a question for Mr. Sun Yao. About three months has passed since the issue of the first electronic invoice. During this period, have you ever run into any problem? How is the general pilot work going at present? would you please brief us its guidance for our future work?

Sun Yao: Until today, three months have passed since the birth of the first electronic invoice in June 27 in Beijing. In this period, the pilot work has been stable and smooth. 614 electronic invoices in total were required by the customers, and 586 ones were issued in real terms, indicating stable operation. Beijing has promoted electronic invoice step by step. First, it has selected some representative E-commerce enterprises that are in urgent need of electronic invoices in large scale. For example, as a pilot enterprise, Jingdong Mall spends near RMB 50 million to print and manage the electronic invoices each year. It is expensive, and at the same time influences operating efficiency.

Therefore, we initiated, from the beginning of the year, the pilot work on electronic invoices with respect to the demands of E-commerce enterprises. The pilot work of electronic invoice is divided into two stages: the first stage is geared to the needs of the individual customers in Beijing. It is also divided into two sessions in the hierarchy of increasing difficulty. In the first session, book commodities are selected as the pilot area with the invoices issued to consumers in Beijing, which is stable currently. Then, we will complete the functions of the supervision platform and the service platform and improve the hardware and software environments via the experiences concluded from the pilot work so as to cover all products. This is the popularization in the first session of the first stage.

We are preparing for the popularization of the second session of the first stage. We need to improve the functions of supervision platforms including the electronic invoice service platform, the tax-control supervision platform and the anti-fake inspection platform so as to apply electronic invoices to all the E-commerce enterprises that are in need of such services and with conditions as well as to increase the enterprises in the pilot work.

Xinhua News Agency: Mr. Li, how do you think of the divergence on the sharing of credit card fee for on-line transaction between the third-party payment platform represented by Taobao and the UnionPay recently? In your view, how to reasonably share the credit fee in on-line credit card transaction to protect the legal interests of both parties?

Li Jinqi: I'd like to say more about the sales of fakes mentioned by Mr. Yao. Sales of fake on line is real, but I have my own view on it. I do not know whether you'll agree. For instance, safety accident rate of plane is low, but it is influential. Although there are not many deaths caused by such accidents, it will attract vast attention in case of occurrence. Honesty problem is widespread in the whole physical market and the virtual market. Fakes are ubiquitous. It is so much concerned due to serous influence of the Internet. Furthermore, I think the Internet is more confident in resisting fakes, because Internet can be operated under real-name system and all things there are traceable. However, real-name system is not fully implemented in the general credit system of the country, or there may even be fake ID cards, so fakes are unavoidable. The network market will be more regulated than off-line trade when real-name system is implemented in every aspect along with the development of the credit system in our country. I' am convinced that the Internet can be purified in such a manner that fakes can be eliminated with the encouragement of the government and the development of the credit system.

Third-party payment is something appeared along with the development of the society and economy. It is unique in China. In Western countries, there are no such systems, because all of them use credit cards. In our country, payment by delivery is the basic mode. Third-party payment is therefore born, which solves the payment link of the trade and deals with the distrust between both parties and the way of payment. As a payment means, there must be profit, and there will be detailed regulations between the banks and the UnionPay.

China Daily: In terms of service trade agreement, it is reported by some media that China is making an effort to join in the negotiation on service trade agreement. Would you please validate this piece of news? In addition, what considerations China hold about entry into the negotiation on service trade, and what influences will there be?

Yao Jian: Along with the development of trade in goods, service trade in our country develops rapidly, which has ranked the third in the world, and export of goods of China has topped other countries. Therefore, we are a key player in the global service trade. Currently, we are paying continuous attention to the formulation progress of international trading rules, including TPP, TTIP, and the negotiation process of service trade agreement carried out based on the GATS.　

A new round of progress on the high standard, further marketization and further integration of global service trade is launched in the service negotiation commenced in March this year. It is a new rule that will be bound to promote further development of global service trade. This is basic judgment. Meanwhile we have noticed that the parties involved keep emphasizing to the outside world that the negotiation on the service trade agreement is open, transparent, and inclusive since its commencement in March. We have been following this progress. We believe that this progress has positive and constructive significance on the global economy.

For China, the service industry is an important driver of China's economic growth, and particularly it is of much significance on the next stage of economic transformation and upgrading. Therefore it makes sense that China pays close attention to the negotiation on service trade agreement. A win-win situation can be achieved between China and the world in development of service trade on the basis of mutual development. China's service industry accounts for 44% of GDP, lower than that of developed countries (over 70%). In the five BRICS countries, the ratio is low at 44%. Therefore, we should accelerate the development of the service industry, especially the manufacture-related service industry. Enhancement of Made-In China service industry is also urgent. In the decades or more since China's entry into the WTO, the openness of service industry has been enhanced. In this process, we have been firm to implementation of independence and openness, and made a great leap forward. In the future, the deepening of openness of service industry is inevitable.

In addition, China boasts vast market in the world. China now ranks the third in service trade. It will bring positive for the negotiation of the service trade agreement and the result gained therein if China joins in the negotiation. Therefore China and the world will both benefit from this event. That is all for my short answer.

Phoenix Satellite Television: In 2012, the E-commerce accounts for 6.3% of total volume of retail, and do you have any data of the first half year to indicate the ratio of E-commerce to total volume of retail?

Sun Yao: In Beijing, the ratio exceeds 10% for six consecutive months, and from January to July, the ratio accounts for 10.8% of total volume of retail.

Yao Jian: As Mr. Sun predicted, the ratio would reach 15% by 2015.

Sun Yao: 15% by 2015 is the goal of Beijing.

Yao Jian: Insiders predict that the ratio will reach 9% in first-tier and second-tier cities.

Li Jinqi: It is hard fact that the E-commerce develops swiftly; we predict that the total amount in E-commerce in 2015 will reach RMB18 trillion in the Twelfth-five Year Plan. However, there is prediction in the society that the amount will reach RMB20 trillion.

Yao Jian: Before long, we issued a white paper on E-commerce, and you can refer to relevant contents.
Reporter from Southern Metropolis Daily: I have two questions for Mr. Li. The first is about the tax on e-commerce. Can you introduce to us your ideas on when and how to levy the tax? The second is about the ideas on completion of laws and regulations in the field of E-commerce. Can you brief us on the progress and ideas of E-commerce legislation?

Li Jinqi: Taxation is the duty of the tax department. We will actively engage in coordination of such problems involved in the development of E-commerce. The Ministry of Commerce has made a lot of laws and regulations on E-commerce. You can find them in the website. Recently, we have been engaged in the promotion of such work, and the qualifications of E-commerce enterprises are also in the process of development.

Business Channel of Shanghai Television: I have two questions for Mr. Li. Last year, both Jingdong Mall and Taobao are involved in the price war on 11 November. Will we strictly supervise the price war among all the E-commerce enterprises? In addition, with the enlarging of E-commerce enterprises, whether some major enterprises have the capability to monopolize the prices? The second question is that whether the Ministry of Commerce strongly supports the on-line banking developed in the E-commerce area, and what is your opinion on it?

Li Jinqi: On-line banking is the duty of the department of finance. We are talking about cross-boundary competition. For example, WeChat and Alibaba are engaged in cross-boundary businesses now, and some E-commerce enterprises are also engaged in logistics. Alipay is something similar to financial products, and it is now developing banking business. The specific policies should be supervised by banking sectors. The third-party payment platform is also reviewed by the bank. Currently, over 200 third-party payment platforms have been approved, which are under the supervision by the department of finance.

Price war is just a process. If you calm down to make a rational analysis, you will have a clear view on these matters whether you are an enterprise or consumers.

Xinhua News Agency: Mr. Li, the data in the China E-commerce Report issued by the Ministry of Commerce each year are widely applied, would you please introduce the source?

Li Jinqi: China E-commerce Report is also called White Paper. It has been issued for six consecutive years since 2003 with influence increasing year by year. This is because the E-commerce is developing swiftly and people pay more attention to the general situation. Not only the government sectors at all levels, but also enterprises are paying more attention to E-commerce, so all the data publicized on the Internet will be shared repeatedly.

In terms of statistics of commercial data, there is no uniform mechanism in the whole country. Then how does our White Paper come out? Many agencies are doing this work. Iresearch, CNNIC, and CCID all have some analysis reports. The National Bureau of Statistics has macro data. Many overseas institutions also have rich data. We always invite experts to analyze and compare these reports. To ensure that these data can accurately reflect the basic state of the E-commerce in China, we organize some experts, major consulting institutions and relevant government sectors to form a joint compiling group. Last year, the group incorporates the commercial departments at the provincial level. The data issued in the Report will be formed after experts' calculation based on the data provided by the commercial departments and consulting institutions in various places. There is a calculation model for the data, and in the appendix to the White Paper, the way to calculate the data and its bases are specified.

It should be emphasized that along with the rapid development of E-commerce, the statistics of E-commerce becomes more and more important, and the White Paper becomes more and more influential, so the data must be accurate. We have established a nationwide e-commerce statistics platform, which will be put into operation soon. It will be tested in part of the provinces and popularized all over the country at the year-end. E-commerce enterprises in different places can report their information through this platform, and we will include all the E-commerce enterprises through this platform. By so doing, we can achieve the sample space of 80% and 90%, generating data with higher accuracy. The platform at the provincial level is also a decision-making platform, not just a form. The competent commercial departments at provincial level will carry out analysis and make decisions with respect to the state of E-commerce in the province through this platform. The can also facilitate the local commercial department to analyze the local E-commerce. Therefore, our statistics will be more accurate and more prompt relying on the operation of this platform.

Although there are various predictions about the facts in the first half year, we summarize the data on a yearly basis, which will subject to the analysis and evaluation of experts. If the platform works, we can get data in a more prompt manner, say the data of a half year, and the data of every quarter. This is beneficial for the analysis and decision-making of the governments at each level and can assist the government in providing better services for the enterprises and the public.

That is all for today's press conference. Thank you.

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