[Gao Feng] Dear friends from the press, good afternoon. Welcome to the regular press conference of the Ministry of Commerce. Firstly, I have one piece of information to release to you.

About China’s outward investment and cooperation in the first two months this year

In January-February 2019, Chinese domestic investors made non-financial direct investment in 1416 overseas enterprises in 138 countries and regions, with an accumulated investment of US$15.66 billion. The contractual value of the newly signed foreign contracted projects was US$22.98 billion, with a turnover of US$17.63 billion. 68,000 laborers of all types were dispatched overseas for labor cooperation. By the end of February, there had been 966,000 laborers of all types overseas.

In January 2019, China's outward investment and cooperation developed stably and healthily, mainly showing the following characteristics:

First, the investment and cooperation in the countries along the “Belt and Road” routes have been steadily advanced. In January-February this year, Chinese enterprises increased investment in 48 countries along the “Belt and Road” routes, totaling US$2.3 billion, up 7%. The contractual value of the newly signed foreign contracted projects in the countries along the “Belt and Road” routes was US$12.23 billion, accounting for 53.2% of the total amount of the same period; the turnover was US$9.6 billion, accounting for 54.5% of the total amount of the same period.

Second, cross-border mergers and acquisitions (M&A) developed steadily. In January-February this year, Chinese enterprises implemented and completed 45 cross-border M&A projects in 22 countries and regions including the UK, Hong Kong (China), Malaysia, involving 12 major industries such as manufacturing, finance, leasing and business services. The actual turnover reached US$2.48 billion, among which the direct investment reached US$1.85 billion.

Third, the structure of outward investment continued to be diversified and the irrational outward investment has been effectively curbed. In January-February this year, foreign investment mainly flowed to traditional investment fields such as leasing and business services, manufacturing, and wholesale and retail, accounting for 28.2%, 20.5%, and 10.2% respectively. Among these, US$3.21 billion flowed to the manufacturing industry, up 16.7%. There were no new projects for outward investment in real estate, sports and entertainment industries.

Fourth, many large contractual projects overseas were newly signed, significantly driving local development. In January-February, there were 86 newly signed contractual projects overseas reaching the contractual value of over US$50 million, accounting for 81.1% of the total value of the newly signed contracts. The turnover of the contractual projects overseas was mainly concentrated in transportation construction and power engineering construction, jointly taking up more than 60% and effectively improving the infrastructure conditions of the host countries.

In January-February 2019, the relevant departments handled 618 newly established and M&A outward investment enterprises, and China’s contractual investment reached US$9.88 billion. Among these, there were 614 non-financial outward investment enterprises, and China’s contractual investment reached US$9.37 billion. There were four financial outward investment enterprises and China’s contractual investment reached US$510 million.

That’s all the information I’d like to share with you. Now I’d like to answer your questions.

Xinhua News Agency: It is reported by Wall Street Journal that Ambassador Lighthizer and Secretary Mnuchin will visit Beijing next week for consultations with Vice Premier Liu He, and Vice Premier Liu will visit Washington afterwards, according to senior US officials. Is it true that the trade consultations have come to the end game? Could you confirm it and what’s your comment?

Gao Feng: Vice Premier Liu He held several telephone conversations with Ambassador Lighthizer and Secretary Mnuchin recently over the trade issues. The two sides agreed that Ambassador Lighthizer and Secretary Mnuchin will visit Beijing on March 28th and 29th to hold the 8th round of high-level consultation, and Vice Premier Liu He will visit Washington D.C. for the 9th round of high-level consultation early in April. Thank you.

China News Agency: President Xi Jinping is scheduled to pay a state visit to France. Could you share with us China’s trade and economic cooperation with France in recent years? What expectations does China have for this visit?

Gao Feng: In recent years, under the direct leadership and push of the two Presidents, China and France have deepened trade and economic cooperation. First, the bilateral trade keeps developing healthily. In 2018, our bilateral trade value crossed the USD 60 billion threshold, reaching a record high of USD 62.9 billion, up by 15.5%. The bilateral trade remains overall balance, with export of agricultural produce, pharmaceuticals, cosmetics, and medium to high end fashion clothing from France growing rapidly. 69 French companies participated in the first CIIE and concluded deals with the second largest amount among European countries. In the first two months of this year, the bilateral trade registered USD 10.6 billion, up by 19.4% year on year. In breakdown, China’s import from France grew by 42.2%. Second, the two-way investment maintains sound momentum. France is the fourth largest investor to China among EU members and the third largest recipient of Chinese investment in the EU. In 2018, French direct investment in China grew by 28% while Chinese direct investment in France grew by 12%. As of January this year, the two-way investment stock was over USD 40 billion. Third, the two countries have kept broadening areas for commercial cooperation. As well as deeper cooperation in such conventional areas as nuclear energy, aviation and aerospace, and automobile, the two sides have expanded cooperation in such emerging areas as ecological preservation, silver economy, and finance.

President Xi Jinping’s visit to France after a five-year interval will surely set the directions for the two countries to further develop trade and economic ties, jointly safeguard multilateralism, and improve global governance. China is ready to work with France to deepen cooperation in such tradition areas as nuclear energy and aviation and aerospace, and expand cooperation in such emerging areas as agriculture, finance, and elderly care, so that we can take bilateral trade and economic cooperation to new heights. Thank you.

Phoenix TV: President Xi Jinping is scheduled to visit Italy, during which the two sides are likely to sign an MOU for Belt and Road cooperation, making Italy the first G7 country to join the Belt and Road Initiative. How do you view the outlook for China and Italy’s cooperation under the Belt and Road? There are some question marks over the intention of Italy and the possibility of sensitive technology transfer? What’s your comment?

Gao Feng: In the past six year since the BRI was proposed, the fundamental principle of consultation and cooperation for shared benefits and the Silk Road Spirit of peace and cooperation, openness and inclusiveness, mutual learning and mutual benefit have won the hearts of more and more people from different countries. More opportunities have arisen for jointly building the Belt and Road and a growing number of people have benefited from the BRI.

Italy, an important stop along the Silk Road, is welcome to join the BRI. In recent years, trade and economic cooperation between China and Italy is in full swing. Currently, China is the largest trading partner of Italy in Asia and its third largest source of import, while Italy is the fifth largest trading partner of China and the fifth largest source of FDI among EU members. In 2018, our bilateral trade crossed the threshold of USD 50 billion and registered USD 54.24 billion, up by 9.1% year on year. In January this year, the bilateral trade kept up the momentum and grew by 8.9% year on year. The two-way investment has been growing rapidly and registered a stock of USD 20 billion. In breakdown, China invested a total of USD 15 billion in Italy while Italy invested USD 7.34 billion in China. The two countries have plenty of scope in cooperation in trade, investment, infrastructure, finance, health, and tourism.

The BRI is open and transparent. All countries are welcome to carry forward the Silk Road Spirit and join the BRI for common development and the benefit of their people. The worries of some countries are uncalled for. China is willing to work with Italy to open up new vistas for bilateral trade and economic cooperation. Thank you.

CBN: Now that the Foreign Investment Law has passed the deliberations of the second session of the 13th NPC, the industries are interested in its implementing rules. How is the progress in drafting the supplementary regulations and rules by MOFCOM? What will be the priorities?

Gao Feng: On March 15th, the Foreign Investment Law was deliberated and adopted by the second session of the 13th NPC, and will be implemented starting from January 1st, 2020. To ensure its successful implementation, MOFCOM is working with applicable authorities to draft the supporting regulations. In the meantime, MOFCOM is sorting out the existing provisions on foreign investment administration and coordinating the work to abolish, amend and enact related laws. In the process, we will carefully collect the opinions and suggestions from FIEs. Thank you.

CNR: According to customs statistics, China’s total import and export grew by 0.7% year on year in the first two months of this year. However, the number dropped by 3.9% in dollar terms. What is the main reason? Will such trend continue or will it pick up as the China-US trade talks make progress?

Gao Feng: China’s total import and export dropped in dollar terms in the first two months mainly because of the Spring Festival. Foreign trade companies usually would export prior to the festival and import after the festival. If you look at historical figures, there are always some fluctuations around the time of the Spring Festival. This year the Spring Festival came 11 days earlier than last year and took up 15 days of February. That’s why February seems to be affected more than other months.

You were right that China-US trade friction also had some role to play. According to our knowledge, some companies concentrated import and export to the second half of last year to cushion the possible impact. This could explain why there’s less import and export in the first two months of this year.

From our information, the import and export growth picked up from early March and are expected to remain stable for the first quarter. As for the whole year, there will be growing factors of uncertainty and instability in the external environment, but the intrinsic vitality of foreign trade will be further unleashed.

Going forward, we will continue to implement the policies to stabilize foreign trade and step up policy tools in the repository. We will also adopt measures to diversify market players, support new forms of business such as cross-border e-commerce, enhance trade facilitation, and strive for high quality and steady development of foreign trade. Thank you.

TASS: The Boao Forum for Asia will be held in Hainan between March 26 and 29, which is a significant large-scale international event on economy. What are MOFCOM’s expectations of the Forum?

Gao Feng: The rising global trade protectionism and severe challenges facing the multilateral trading system give rise to multiple uncertainties over sound and stable growth of the world economy. In this context, all eyes are on the Boao Forum for Asia this year, a much-hoped for event that can breathe new life into multilateralism and free trade.

The theme of the Boao Forum for Asia Annual Conference is “Shared Future, Concerted Action, Common Development”. Discussions will center on topics relating to an open world economy, multilateralism, regional cooperation, global governance and others. MOFCOM will organize or participate in parallel sessions on pilot free trade zones and free trade ports, global governance, WTO reform and other issues.

We look forward to joining other participants from governments, business communities and academia in thorough discussions on such issues as global economic governance, upholding the multilateral trading system, trade and investment liberalization and facilitation and building an open world economy. We hope to send a positive message to the world via this open and inclusive communication platform.

China Business Herald: We’ve noted that between January and February this year, the growth rate of total online retail sales in China fell below a long-held record of above 30%. Why is that? What’s your outlook on the future of Chinese e-commerce industry in 2019?

Gao Feng: Chinese online retail market has expanded rapidly for more than a decade. In 2018, China’s online retail spending exceeded RMB 9 trillion, ranking first in the world for six consecutive years.

The online retail market in China has two outstanding features. First, online retail spending maintains rapid growth and remains an important driver of consumption. In the first two months of this year, the online retail sales of physical goods totaled RMB 1.1 trillion, up by 19.5% year-on-year, which is 11.3 percentage points higher than the growth rate of total retail sales of consumer goods in the same period. Online retail spending represent 16.5% of retail sales of consumer goods, increasing by 1.6 percentage points from the same period of last year. Second, the model and structure of online retail spending are further improving. According to MOFCOM’s big data monitor, the B2C model, or business with advantages in quality and services to customers, accounts for 73.5% of total retail sales, up by 3.3 percentage points from last year. Online retail is moving towards a direction of individualization and customization.

As Chinese economic growth shifts from high-speed to high-quality, and the growth dividends of Chinese internet users fade away, the gradual slowdown in online retail spending fits into the pattern of economic development.

From the perspective of the trend of the e-commerce industry, the industrial base, model innovation, technology application, user habits and other factors supporting fast growth in online retail remain in place. We are fully confident of the sustained and sound growth in the online retail market in 2019.

Going forward, we will continue to monitor developments and changes of the online retail market, consider measures to create an enabling and standard online retail market, and promote sound, stable and innovation-driven growth of the online retail market. Thank you.

21st Century Business Herald: The Second High-level UN Conference on South-South Cooperation was held in Buenos Aires, Argentina on March 20. What does China plan to do to promote South-South Cooperation?

Gao Feng: The Second High-level UN Conference on South-South Cooperation was held in Buenos Aires, Argentina between March 20 and 22. Vice Premier Hu Chunhua headed the Chinese delegation to the UNOSSC and delivered a keynote speech.

South-South cooperation is a common cause of developing countries helping each other, working together and seeking common development. As a useful supplement to North-South cooperation, South-South cooperation has played a positive and important role in eradicating poverty, jointly rising to development challenges, achieving sustainable development and other aspects in developing countries.

As the largest developing country in the world, China has always been a staunch proponent, an active player and a major contributor to South-South cooperation. China stands ready to continue to do its utmost to undertake responsibilities that are commensurate with China’s development stage and capacity on the basis of equal footing, mutual benefits and win-win relations. China is willing to join fellow developing countries in meeting challenges together and achieving common development.

China will help more products of developing countries find their way to its market and share opportunities in China, encourage and expand investment in fellow developing countries, and step up assistance in key areas including poverty reduction, agriculture, health care, infrastructure, skill training and education. China will share development experience with fellow developing countries to improve the wellbeing of their people and enhance their capacity of self-development. In the meantime, we are ready to work with all parties to push forward international cooperation under the Belt and Road Initiative in the principle of broad consultation, joint contribution and shared benefits so as to inject new impetus into South-South cooperation. Thank you.

Beijing Business Today: The Foreign Investment Law grants local government at county-level and above the authority to develop policies of promoting investment facilitation. Some people point out that this may escalate the already-imbalanced regional development and lead to vicious competition among localities. What’s MOFCOM’s comment?

Gao Feng: As I’ve mentioned, MOFCOM is working with relevant agencies on formulating supporting regulations relating to the Foreign Investment Law. We will listen attentively to the comments and advice from all interested parties in the process. Thank you.

This is the end of today’s press conference. Thank you.