Economic Daily: It is reported that Vice Premier Hu Chunhua is scheduled to attend the 3rd China-Pacific Island Countries Economic Development and Cooperation Forum in Samoa. Could you share with us the preparation for the forum and the economic cooperation between China and PICs?

Gao Feng: China-Pacific Island Countries Economic Development and Cooperation Forum is the economic and trade dialogue at the highest level between China and PICs and serves as a critical platform for closer economic ties and common development for the two sides. To implement the common understanding between President Xi Jinping and PICs’ leaders in November 2018, the 3rd Forum will be held on October 20 and 21 in Apia, Samoa. The Forum will be attended by Vice Premier Hu Chunhua, head of the Chinese delegation, and over 400 government officials, representatives of international and regional organizations, business leaders, representatives of chambers and business associations, and scholars from China and PICS. They will discuss new ideas, new pathways for all-round exchanges and cooperation between China and PICs to drive our economic development.

Apart from the opening ceremony, the Forum will contain four thematic sessions on trade, agriculture and forestry and fisheries, tourism and infrastructure, environment and climate change. A business matching event will also be held.

Regarding the trade and economic cooperation between China and PICs, in recent years, our commercial cooperation has grown in size and width, with deeper interest integration. According to China’s statistics, trade between China and 8 PICs having diplomatic ties with China (excluding Solomon Islands and Kiribati) reached USD4.32 billion in 2018, up by 25.5%. In breakdown, China exported USD1.42 billion and imported USD2.9 billion. At present, China stands as the largest trading partner and export market of Solomon Islands, the second largest trading partner of Papua New Guinea and Fiji, the third largest trading partner of Samoa. Direct investment from China to PICs surged from USD900 million at the end of 2013 to USD4.53 billion, up by 400%, covering mining, agriculture, fisheries, wholesale and retail. The project contracting agreements China signed with PICs reached USD15.01 billion, covering construction, road, airport, water, telecommunications, and will create 15,000 jobs for PICs. Thank you.

China Media Group: We learned that Vice Premier Hu Chunhua will also visit the Philippines. Could you give a picture on the commercial cooperation with the Philippines?

Gao Feng: In recent years, leaders of China and the Philippines have exchanged visits frequently. Last November, President Xi Jinping paid a state visit to the Philippines, elevating the bilateral relations to comprehensive strategic partnership. In April and August this year, President Xi met twice with President Duterte, guiding the development of bilateral relations from a strategic and long-term perspective.

Under the guidance and commitment of the two leaders, China-Philippines practical cooperation has come a long way. China is now the largest trading partner of the Philippines. According to China’s statistics, bilateral trade registered USD55.67 billion in 2018, up by 8.5% from the year before. In the first nine months of this year, bilateral trade reached USD 44 billion, up by 6.1%. Chinese business investment in the Philippines has been increasing rapidly. In the first eight months of this year, non-financial direct investment grew by 100.3% year on year. People-to-people exchanges also kept growing. Last year, Chinese tourists to the Philippines hit 1.25 million person times, and are expected to hit 1.5 million person times.

Vice Premier Hu will discuss with the Philippines ways to implement the leaders’ agreement expeditiously, jointly build the Belt and Road to a high standard, expand cooperation in trade, investment, and tourism, accelerate the implementation of major joint projects, and step up multilateral and bilateral cooperation. The two sides will also sign cooperation agreements. Thank you.

Bloomberg: It is claimed by the US that China has agreed to increase agricultural purchase to USD40 to 50 billion, is that accurate? What are the preconditions for China to increase purchase? Does that require a party to reduce part or all the retaliatory tariffs in the first place?

Gao Feng: According to available information, China has imported a certain amount of agro-products from the US since the beginning of this year, including 20 million tons of soybean, 700,000 tons of pork, 700,000 tons of sorghum, 230,000 tons of wheat, and 320,000 tons of cotton.

During the just concluded high-level consultation in Washington D.C., the parties had a candid, efficient and constructive discussion and made substantive progress. The phase I agreement will set fort that China will increase the purchase of US agro-products based on domestic demand and market principles and the US will create favorable conditions for this to happen. I cannot share with you the details for now.

In our view, it’s impossible to make substantive progress or reach a mutually-acceptable deal without mutual respect, equality and reciprocity. The last round of high-level consultation witnessed substantive progress, thanks to the efforts of both sides to meet each other halfway and accommodate each other’s reasonable concerns.

China is willing to properly handle trade and economic differences with the US through continued dialogue and cooperation, with a view to bringing our bilateral trade and economic relationship back on the right track as soon as possible. Thank you.

CNBC: President Trump noted that the Phase I agreement will be completed within the coming three weeks? Is that true? What are the concrete requirements to reach a deal? How would MOFCOM respond to import and export decline in September? Will measures be taken to boost import and export?

Gao Feng: regarding the first question, the two teams are communicating closely and working intensely at the instruction of the principles following last round of consultations. I do not have any more information to share with you as for the nitty-gritties of the deal.

Regarding the second question, some international organizations have downgraded their forecast for global economy and trade growth amid rising trade protectionism and sluggish demand on the international market. Given these factors, China’s import and export dropped by 3.3% in September year on year. But I’d like to remind you that the figure in September last year was a record high, which partly explains the decline this year. We also observed that the total import and export in September was higher than previous months this year, up by 2.4% from August. Quarterly speaking, import and export in Q3 grew by 0.7%. Looking around the world, China’s import and export grew faster than the average of 65 major economics in the first seven months. In general, China’s import and export remained stable in size, with improved structure, quality and efficiency in the first three quarters. Going forward, we, in collaboration with relevant authorities and local governments, will continue to foster new forms and models of foreign trade, promote innovation-driven development of processing trade, render help to businesses as they tap into and diversify international markets, actively increase import, and improve the business environment for foreign trade, aiming to achieve high-quality development of foreign trade in China.

South China Morning Post: A follow-up question on agricultural products. After the last round of China-US high-level economic and trade negotiations, US President Donald Trump said that China has started purchasing US agricultural products. Can you confirm this?

Gao Feng: Chinese businesses have been importing US agricultural products based on domestic demand and market principles for a long time. Further details will be released in a timely manner. Thank you.

Phoenix TV: My question is about tariffs. In the Phase 1 agreement, the US promises to suspend, not to remove, additional tariffs on US$250 billion of Chinese goods, and retains tariffs on US$100 billion of Chinese goods starting from December. What’s your comment on this outcome and the Phase 1 agreement as a whole?

Gao Feng: China’s positions, principles and purposes in China-US economic and trade negotiations remain the same. The ultimate purpose of our negotiations is to stop the trade war and remove all additional tariffs. This will prove benefit to China, to the US and to the whole world. It is hoped that the two sides would work together to push forward the negotiations so as to reach an agreement for this stage as soon as possible and make new progress on the removal of tariffs. Thank you.

China News Service: When will China and the US sign the Phase 1 agreement? What are the arrangements for follow-up negotiations?

Gao Feng: As I mentioned, our working teams are speeding up negotiations to conclude the text of the agreement as soon as possible. As for the arrangements for upcoming negotiations, we will release concrete information in a timely manner. Thank you.

Xinhua News Agency: In the new round of China-US economic and trade negotiations, the two sides have made substantive progress on agriculture, finance, exchange rate and other sectors. Could you please provide some details? Second, Some comments go that the Phase 1 agreements are too limited to eliminate all uncertainties in China-US economic and trade relations. What’s your comment?

Gao Feng: On your first question: As agreed by the two sides, there’s no further information that I can disclose at this moment.

On your second question: China holds that cooperation is the best choice for both countries, and is the only correct one to solve the problems. Our progress for this phase will help reduce uncertainties and restore market confidence, bearing enormous significance for stabilizing global economy.

We believe that as long as China and the US can continue dialogues and cooperation on an equal footing and with mutual respect, the two sides will make new progress and find solutions acceptable to both sides. Thank you.

CNR: I have several questions about foreign trade statistics. China’s import decreased by 0.1% for the first three quarters this year and by 6.2% in September year-on-year. What’s the reason for the continuing decline in import this year? Second, China’s import from the US decreased by over 20% for the first three quarters compared with last year. Is this a reason for the decline? For the first three quarters, the US has dropped to our third largest trading partner, with its second place taken by the ASEAN. What’s your view?

Gao Feng: In terms of import, statistics from Chinese customs show that for the first three quarters this year, China’s import remained stable with a minor decline of RMB10.4 billion, or 0.1% year-on-year. As for the main reasons, China’s import from the US shrank by RMB179.8 billion, a 22.5% decrease year-on-year. Meanwhile, the prices of commodities such as crude oil, steel, lumber, rubber, coal, pulp and soybean on the international market slumped, resulting in a 5.5% decrease in import growth. Through a series of measures such as holding import expos, lowering tariffs and facilitating import, China has continuously opened up its market and driven up import from exporters other than the US significantly, keeping China’s import stable in general from January to September.

As for the ranking of trading partners, statistics from Chinese customs show that in the first half of this year, the US was overtaken by the ASEAN and became China’s third largest trading partner. Nevertheless, be the US in the second or third place, China and the US remain important trading partners to each other. Since last year, complexities have arisen in China-US economic and trade cooperation, which are the consequence of trade frictions provoked and escalated by the US. The falling bilateral trade statistics fully demonstrate that there is no winner in a trade war. It is negotiation and cooperation that are the right choices. As substantive progress was made in the latest round of negotiations, it is hoped that the two sides would move in the same direction to implement the important understanding reached by our leaders. We should enhance communication and manage our disputes, so as to bring our cooperation back on track and foster a better environment for bilateral economic and trade development as well as for global economic prosperity and stability. Thank you.

Shanghai Securities News: We have taken notice that the State Council recently approved the Master Plan of the Development of China-Shanghai Cooperation Organization (SCO) Local Trade and Economic Cooperation Demonstration Zone (hereinafter the Master Plan). What are the considerations behind setting up the demonstration zone in Qingdao? What features will it have?

Gao Feng: Setting up the China-SCO Local Trade and Economic Cooperation Demonstration Zone in Qingdao is an important measure announced by President Xi Jinping at the SCO Qingdao Summit held in June last year. In September this year, the State Council officially approved the Master Plan.

According to the requirements set out in the Master Plan, the demonstration zone will follow the course of Belt and Road Cooperation, give full play to Qingdao’s sea port logistic advantages and industrial advantages, strengthen land-sea multimodal transport cooperation with SCO member states, boost two-way trade and investment, as well as interact and cooperate with industrial parks in other countries. It will be built into a new platform for Belt and Road international cooperation.

In developing the demonstration zone, efforts will be focused on building four major hubs: (1) a regional logistic hub to enhance intra-regional connectivity; (2) a modern trading hub to strengthen intra-regional trade exchanges and cooperation; (3) a two-way investment cooperation hub to step up intra-regional capacity cooperation; and (4) a commercial, tourism and cultural exchanges and development hub to promote the intra-regional integrated development of commerce, tourism and culture.

MOFCOM will work closely with Shandong province to strengthen coordination and take stock of our experience in a timely manner in order to create a sound environment for developing the demonstration zone.

Yicai: Before buying more agricultural produce from the US, does China request that the US must cancel or cut tariffs? Will China have more meetings with the US before signing the agreement? If so, where will the meetings be held?

Gao Feng: As regards your first question, recently the US exempted more Chinese products from tariffs and Chinese businesses purchased US agricultural produce according to market principles, creating a good atmosphere for the trade and economic consultation. As far as I know, Chinese businesses are still increasing imports of US agricultural produce according to China’s domestic market demand. China has a huge market. Ending the trade war at an early date and canceling additional tariffs will help expand bilateral trade and economic cooperation in more sectors, including agriculture.

As regards your second question, the two sides have stayed in close touch through various means after the high-level consultation concluded. Working-level consultations on the text of the agreement are now being held. It is not time for me to talk about the details of the consultations. Thank you.

CGTN: I have a follow-up question regarding the import of agricultural produce. You just briefly talked about China’s purchase of US agricultural produce. How much more produce is China planning to buy? In the last round of hi-level consultation, the two sides reached a partial agreement. Are the leaders planning to announce a complete deal at the APEC meeting to be held next month? What are the tough issues to be addressed before signing the final deal? Thank you.

Gao Feng: I have just responded to your first question on agricultural produce.

As for your second question, right now, the two economic and trade teams are stepping up their consultations on the text of the Phase I agreement. They are striving to reach consensus based on equality and mutual benefit at an early date. At the same time, the two sides are discussing the work arrangement in the next stage. We will publish further information in a timely manner. Thank you.

CNR: We have taken notice that in the first three quarters of this year, trade and investment between China and the US both declined. Will this trend be changed?

Gao Feng: Since the beginning of this year, China-US trade and investment have declined as a result of the China-US economic and trade friction and other factors. This fully demonstrates that a trade war produces no winner and is not in the interests of the two countries or of the wider world. China and the US are highly complementary and have both reaped enormous benefits in their trade and economic cooperation, which is a win-win situation. History and reality show that sound China-US trade and economic ties benefit not only the two countries, but also the whole world.

It is hoped that the two sides can pull in the same direction, follow the principles and course set by the two leaders, appropriately address each other’s concerns based equality and mutual respect, push for sound and stable development of bilateral trade and economic ties and inject new impetus into world peace and prosperity. Thank you.

Bloomberg: Will President Xi Jinping and President Trump meet and sign a deal at the APEC Chile Summit?

Gao Feng: As I said just now, economic and trade teams from both sides are stepping up their consultations on the text of the Phase I agreement and striving to reach consensus at an early date. At the same time, the two sides are discussing the work arrangement in the next stage. We will publish further information in a timely manner. Thank you.

Gao Feng: Do you have any other questions?

If not, today’s press conference comes to an end. Thank you.