Speakers:
Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT)
Zhao Zhiguo, spokesperson of the MIIT and director general of the Bureau of Information and Communications Administration of the MIIT
Tao Qing, an official of the Bureau of Operation Monitoring and Coordination of the MIIT
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Jan. 18, 2023
Xing Huina:
Friends from the media, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Mr. Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT). Mr. Tian will brief you on the development of the industry and information technology sector in 2022 and take your questions. We are also joined by Mr. Zhao Zhiguo, spokesperson of the MIIT and director general of the Bureau of Information and Communications Administration of the MIIT, and Ms. Tao Qing, an official of the Bureau of Operation Monitoring and Coordination of the MIIT.
Now, I'll give the floor to Mr. Tian Yulong for a brief introduction.
Tian Yulong:
Ladies and gentlemen, friends from the media, good afternoon. As the new year begins and the Spring Festival approaches, I would like to take this opportunity to extend my best Chinese New Year wishes to you in advance and wish you happiness and good luck in the upcoming Year of Rabbit. I'd also like to thank you for your continued interest in and support for the development of the industry and information technology sector. Now, I'll brief you on the sector's general situation in 2022.
The year 2022 was of crucial significance in history to both the Communist Party of China (CPC) and the nation. Under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the MIIT, together with all localities and government departments, has thoroughly implemented the decisions and plans of the CPC Central Committee and the State Council. It has acted in full accordance with the key requirements of ensuring effective COVID-19 containment, economic stability, and development security. It has also proactively responded to the shocks of unexpected factors. As a result, China's industry and information technology sector achieved generally stable growth while making further progress. Specifically, the industrial economy has resumed steady growth with a promising outlook; the information and communications technology (ICT) industry has posted a stable growth; and the industrial and supply chains has achieved unimpeded and stable operations. In addition, the industrial sector's contributions to the national economy have further increased; the nation's industrial development has shown greater resilience; and the specialized development of small- and medium-sized enterprises (SMEs) has been further accelerated. In general, the sector has the following four highlights.
First, the industrial economy has resumed its steady growth with a promising outlook, and its role as an anchor of the macro economy has become even more evident. Ensuring stable growth was high on the agenda last year. Given this, we took multiple measures to expand investment, boost spending, and stabilize foreign trade, and our efforts to ensure the unimpeded and stable operations of industrial and supply chains have paid off. In 2022, China's added value of industries above the designated size grew by 3.6% year on year, and that of the manufacturing industry increased 3% year on year. Investment in the manufacturing sector climbed 9.1% from a year earlier, and the export delivery value of industrial enterprises above the designated size rose 5.5% year on year. The industrial economy provided a strong support for stabilizing the macro economy. The industrial sector contributed to 36% of the nation's economic growth, a relatively high level compared to recent years. The industrial sector lifted the nation's economic growth by 1.1 percentage points, which included a boost of 0.8 percentage points from the manufacturing industry. The added value of the manufacturing industry accounted for 27.7% of the nation's gross domestic product (GDP), up 0.2 percentage points over the previous year.
Second, industrial restructuring, transformation, and upgrading have been thoroughly advanced, and industrial development has shown greater resilience. We have continued regarding high-quality development as our top priority and strived to promote industrial restructuring, transformation, and upgrading. As a result, the manufacturing sector has become higher-end, smarter, and more eco-friendly at an accelerated pace. A number of sci-tech innovation achievements have been made. For example, China's first self-developed C919 large passenger aircraft was delivered at the end of last year. Breakthroughs were also made in the whole machine and key spare parts of China's self-developed extracorporeal membrane oxygenation (ECMO), which has been certified for marketing and put into use. A total 45 national-level advanced manufacturing clusters and another 100 SME clusters for distinctive local business were developed. The industrial internet has been used in 45 major categories of the national economy, and there has been more than 240 influential industrial internet platforms, injecting new impetus to industrial upgrading. Steady progress has been made in the eco-friendly and low-carbon transformation of industries. In the first 11 months of 2022, the energy consumption per unit of added value of industries above the designated size dropped 1.4% year on year. The added value of high-tech manufacturing industry grew by 7.4% year on year in 2022, 4.4 percentage points higher than the growth rate of the added value of the manufacturing sector as a whole. The production of new products maintained a high growth rate. In particular, the production of new energy vehicles has been ranking first globally for eight consecutive years, and their production and sales grew by 96.9% and 93.4% year on year, respectively. This speaks volumes for the resilience and stability of industrial development.
Third, the ICT industry posted a stable and continuous growth, and industrial integration further enabled the sector's development. We continued leveraging the leading role of new-generation information technologies, and ramped up efforts to develop new business forms and tech applications. In 2022, the revenue of China's telecommunication sector grew by 8%. Investment in the sector continued to expand, and infrastructure kept improving. China built 887,000 new 5G base stations in 2022, and the total number amounted to 2.312 million, accounting for over 60% of the global total. Among Chinese cities, 110 have reached the standard of building 1000M fiber optic networks. The number of mobile Internet of things (IoT) connections in China reached 1.84 billion, making China the first among major economies to have more IoT connections than internet users. The number of 5G users reached 561 million, accounting for one-third of all mobile phone users, 2.75 times that of the global average. Integration of tech applications were further accelerated. More than 50,000 5G applications have enabled multiple sectors such as industries and healthcare services. The management of mobile applications saw further progress in 2022, and users' rights and interests were effectively safeguarded. More efforts were made to strengthen the protection of critical information infrastructure and improve data security management in industry and information technology sector at an accelerated pace. The capacity to ensure emergency communications continued to strengthen, and the nation's basic telecommunication networks maintained their safe and stable operations. The ICT industry has effectively supported and guaranteed economic and social development and the construction of the digital economy.
Fourth, policy planning continued to take effect, which further boosted business confidence. We earnestly implemented the decisions and plans of the CPC Central Committee and the State Council, kept policy planning as our main focus in order to stabilize growth, and continued to unleash policy dividend and boost business confidence. We scaled up the efforts to carry out the policy package on stabilizing economy and its follow-up measures. We also worked with relevant government bodies to introduce a series of policy documents on further boosting the industrial economy and providing assistance to SMEs. We organized and rolled out 27 plans in the industry and information technology sector for the 14th Five-Year Plan period (2021-2025), in a bid to ensure the coordination and implementation of key industries, projects, and programs. The driving force of these policies and plans has translated into a strong momentum to restore the industrial economy and boosted business confidence and expectations. In 2022, China's tax and fee cuts, tax refunds, and tax and fee deferrals for all types of market entities topped 4 trillion yuan, about 40% of which were offered for micro and small businesses. This has created a solid guarantee to ease the difficulties of SMEs and enable their sound and stable development.
In 2023, the development of the industry and information technology sector still faces a severe and complicated domestic and overseas environment. In particular, the sector's stable operations in the first quarter requires arduous efforts. We believe that, with the optimization of COVID-19 response and the effect of both existing and new policies, we have the confidence, resolve, and ability to cope with various difficulties and challenges. Looking forward, we will fully carry out the guiding principles of 20th CPC National Congress and the decisions and plans of the Central Economic Work Conference. We will keep ensuring stable growth high on the agenda and strive to expand demand, foster market circulation, assist businesses, strengthen growth momentum, and stabilize expectations. We will see to it that the industry and information technology sector achieve new progress, expedite the development of new industrialization, and make new and greater contributions to building a modern socialist country in all respects.
That concludes my introduction. Next, my colleagues and I will take your questions. Thank you.
Xing Huina:
The floor is now open for questions. Please indicate the media organization you work for before raising questions.
_ueditor_page_break_tag_Yi Cai:
In recent years, the new energy vehicle industry has maintained rapid development. Can you talk about the development of this industry in 2022? What measures will be adopted by the MIIT to promote its high-quality development? Thank you!
Tian Yulong:
Thank you. I will answer your questions. The new energy vehicle industry is a major direction for the transformation and upgrading of the global automobile industry. This industry has been developing rapidly in all countries. And it is also an important option for emission reduction. Last year was another bumper year for the development of the new energy vehicle industry, mainly reflected in the following aspects.
First, China has been leading the world in market size. In 2022, a total of 7.058 million new energy vehicles were produced, and 6.887 million were sold, with a year-on-year increase of 96.9% and 93.4%, respectively, ranking top globally for eight consecutive years. The sales of new energy vehicles accounted for 25.6% of the total sales of new vehicles. The data is promising, and the industry shows a strong momentum for development.
Second, new breakthroughs have been made in key technologies. The energy density of mass-produced power batteries stood at 300 watt-hours per kilo, reaching an advanced level globally. The gravimetric specific power of the driving motor surpassed 4.8 kWh per kilo, with the highest rotational speed reaching 16,000 rpm. These indicators show that great improvement has been achieved in key components and parts. In particular, breakthroughs have been made in technologies concerning laser radar, AI chips, and intelligent cabins, reaching an advanced global level.
Third, brand competitiveness has markedly improved. In 2022, sales of Chinese-brand new energy passenger vehicles took up 79.9% of the total sales in the domestic market, up 5.4% year on year. The new energy vehicle exports reached 679,000, a 1.2-fold increase over the previous year. Among the global top 10 enterprises in terms of sales of new energy vehicles, three are Chinese enterprises. Among the global top 10 enterprises in terms of installed capacity of power batteries, six are Chinese. The competitiveness and brand impact have been increasingly stronger.
Fourth, supporting facilities have been increasingly optimized. As of the end of 2022, a total of 5.21 million charging plies and 1,973 battery charging stations have been established. 2.593 million charging piles and 675 battery charging stations were added in 2022. The construction of battery charging and swapping facilities has been notably accelerated. At the same time, over 10,000 service outlets for recycling power batteries have been built, basically ensuring that people can access battery recycling services close to home.
Currently, China's new energy vehicle industry has entered a period of market expansion across the board and maintained rapid growth. Next, we will strengthen our work in the following aspects.
First, stronger policy support will be provided. We will work with relevant departments to establish a coordination mechanism for developing this industry and strengthen coordination and synergy between central and local governments. In particular, we will promote the implementation of supporting policies concerning vehicle purchase tax, vehicle and vessel tax, license plates, and others. We will formulate a roadmap for green development of the automobile industry, revise and issue "double credits" management provisions for corporate average fuel consumption and new-energy vehicles, and launch trials for the market access of intelligent connected vehicles.
Second, steady performance will be ensured. We will conduct research on formulating follow-up supporting policies for the new energy vehicle industry. We will promote the application of battery-charging facilities and the development of fuel-cell vehicles. In particular, we will launch pilot programs in establishing pioneering zones for comprehensive electrification of vehicles in public areas in cities. Further steps will be taken to promote quality brands, and to maintain consumer market stability.
Third, integrated innovation will be supported. We will give full play to the role of leading enterprises and national manufacturing innovation centers and promote small, medium, and large enterprises to pursue development through greater synergy. We will accelerate research and industrial development of new technologies, including new types of batteries, automotive-grade chips, and automotive operating systems, advance integrated development of autonomous driving vehicles and the cooperative vehicle infrastructure system, and enhance the integrated and innovation-driven development of the new energy vehicle industry and sectors such as energy, transportation, and ICT.
Fourth, the development environment will be optimized. We will carry out strict management of production access and provide stronger guidance for investment to avoid low-level and redundant construction. Development and distribution of domestic and overseas resources will be carried out in a coordinated way to ensure the supply of raw materials and key parts. Regulations on recycling power batteries will be formulated at a faster pace to improve the system for recycling power batteries. Greater efforts will be taken to advance the construction of charging piles, and their accessibility will be improved to provide sound facilities and environment for the development of new energy vehicles.
Thank you!
_ueditor_page_break_tag_China Electronics News:
The industrial internet plays a crucial role in promoting deep integration of the digital economy and the real economy, and it has been producing positive effects on advancing the transformation and upgrading of traditional industries. What new progress was made regarding China's industrial internet in 2022? What will be done to advance wider application of the industrial internet? Thank you.
Zhao Zhiguo:
Thank you for your questions. In 2022, we resolutely implemented the decisions and plans of the CPC Central Committee and the State Council, sped up the development of the industrial internet, with the total output value of this industry estimated to be 1.2 trillion yuan, providing strong support for high-quality economic and social development.
First, an analysis system for industrial internet identification has been fully established. Five national top-level nodes covering the eastern, western, southern, northern, and central regions and two nodes for disaster tolerance and backup have been put into use. Second-level nodes have fully covered 31 provinces (autonomous regions, municipalities) and provided services for nearly 240,000 enterprises. Over 240 influential industrial internet platforms have been developed, with 28 cross-industry and cross-sector platforms, effectively promoting data sharing and resource coordination among the whole process of product development, all links of production, and upstream and downstream supply chains, and accelerating digital transformation of enterprises.
Second, the "5G+Industrial Internet" 512 Project has been accomplished successfully. Five public service platforms for the industry have been built, providing services for industrial enterprises in their application of 5G technologies. Over 4,000 projects have been launched in more than 10 key industries, including automobile and mining industries. The application of 20 typical application scenarios such as coordinated research, development and design, and the remote control of equipment have been promoted at a faster pace, effectively promoting enterprises to improve quality, reduce costs, and increase efficiency. The integration of the industrial internet and 5G has produced an increasing variety of products. The price of modules has dropped by 80% from the early stages for commercial use. Waves of constructing 5G connected factories have swept across the country, advancing the application of 5G technologies to the core links of production.
Third, multiple measures have been adopted to empower the transformation of the industry. Based on the common needs of the industry, we have developed a batch of carriers to serve the promotion of the application of the industrial internet and foster low-cost and lightweight solutions, lowering the thresholds for enterprises, especially SMEs, to carry out digital transformation. Focusing on the characteristics of various industries, we have formulated and promoted the guidance for integration and application of the industrial internet for over 10 key industries, such as the steel industry and the electronic industry, guiding the industries and enterprises to apply the industrial internet in accordance with the conditions specific to their industries and enterprises. Addressing weak links, we have implemented innovative projects for the industrial internet development, advanced research and industrialization of key technologies and products, and issued a series of national standards, industrial, and group standards, furthering improving the system of standards.
Next, our work will focus on three aspects to accelerate the large-scale development of the industrial internet, promote deep integration of the digital economy and real economy, keep unleashing momentum for industrial upgrading, and support the industrial economy to steadily rebound.
First, we will optimize the environment by enhancing policy guidance. We will, together with other government departments and local authorities, take solid steps to advance the implementation of a three-year action plan (2021-2023) for the innovative development of the industrial internet to ensure that all work will be accomplished. We will formulate policies and measures to promote the large-scale development of the industrial internet, further improve the top-level design, make good and full use of fiscal, tax, and financial policies, and strengthen cooperation between industry and finance and integration between industry and academia to further create a sound development environment.
Second, we will create more drivers for development by promoting innovation. We will enhance technological innovation and continue to implement innovative projects for industrial internet development, strive to make major breakthroughs in technologies, and improve the system of standards to remove the major obstacles hindering the large-scale development of the industrial internet. We will deepen industrial innovation, support all kinds of market entities such as telecommunication enterprises, internet platform companies, and industrial enterprises to leverage their strengths and create greater synergy. We will make great efforts to nurture leading enterprises and specialized and sophisticated SMEs that produce new and unique products, and strengthen the industry alliance for the industrial internet to create a healthy and sustainable environment for the industry.
Third, we will push for wider application by accelerating the promotion and popularization of the industrial internet. We will move faster to foster advanced factories, and encourage enterprises to carry out the digital transformation of factories by means of 5G and other technologies to promote wider applications of new technologies, new scenarios, and new models. We will accelerate upgrading clusters of industries, launch the campaign to promote the application of the industrial internet in 1,000 industrial parks of 100 cities and summarize and promote successful cases to advance digitalization and green development of industrial parks. We will expand the application of the industrial internet in key sectors and in key industrial chains, and widely promote supply-demand matching to promote high-quality development of the real economy by large-scale application of the industrial internet.
Thank you!
_ueditor_page_break_tag_CCTV:
The report to the 20th CPC National Congress has underlined that the resilience and security of China's industrial and supply chains will be improved. What has been done by the MIIT to enhance the resilience, security, and competitiveness of industrial and supply chains? What measures will be adopted next? Thank you.
Tian Yulong:
Thank you. We will have Mr. Tao Qing answer your questions.
Tao Qing:
Thank you for your questions. Since the beginning of 2022, the MIIT has resolutely implemented the decisions and plans of the CPC Central Committee and the State Council, taken it as a top priority of its work to maintain security and stability in industrial and supply chains and worked with relevant departments to effectively respond to the impact of unexpected factors. With all these efforts, the overall security and stability of the manufacturing industry in China have been maintained, and the resilience of China's industrial and supply chains has been further enhanced. First, we have given equal emphasis to short-term response and long-term prevention and made every effort to ensure smooth circulation of industrial and supply chains to consolidate the foundation for ensuring stability. Especially when responding to the impact of the pandemic in April last year, we rapidly established a white list system for enterprises in key industrial and supply chains and promoted work and production resumption along industrial chains in a coordinated and systematic way. We have built up coordination platforms for key industrial and supply chains such as integrated circuits, automobiles, and medical supplies, established a "red light" early warning mechanism for auto parts inventory, and a "red, yellow, and blue" early warning coordination mechanism for bulk raw material supply, and helped to resolve problems that concerned enterprises one by one to ensure stability in key industrial chains. Meanwhile, we have comprehensively summarized the experience, guided local authorities to strengthen early warning and monitoring of emergencies, and set up contingency plans in advance to resist risks to reinforce the ability to withstand risks. Second, we have worked to shore up weak links and build up strengths at the same time and adopted a package of steps to strengthen the core competitiveness of the industrial and supply chains. We have held International Forum on Resilient and Stable Industrial and Supply Chains. General Secretary Xi Jinping has sent a congratulatory letter to the forum. During the forum, we, together with Indonesia, and five other countries, have jointly released the Initiative of International Cooperation on Resilient and Stable Industrial and Supply Chains. Focusing on the blockages in industrial and supply chains, we have launched projects to achieve breakthroughs in core technologies in key fields and projects for upgrading foundational industrial infrastructure to promote breakthroughs in important basic products and core technologies in key fields. We have given play to the guiding role of plans in promoting traditional competitive industries and emerging industries to break growth bottlenecks. We have fostered clusters of advanced manufacturing, with global competitive edges in some areas taking shape. We have promoted the development of specialized and sophisticated SMEs that could produce novel and unique products and given play to the leading role of competitive enterprises to boost the dynamism of the manufacturing industry.
Next, we will keep putting equal emphasis on development and security, give priority to major tasks of shoring up weak links, building up strengths, consolidating foundations, and fostering clusters of industries, and accelerate the upgrading of the industrial base and modernization of industrial chains. Our work will mainly focus on the following three aspects.
First, we will cement foundations and move faster to shore up weak links. We will implement projects for upgrading foundational industrial infrastructure and projects to achieve breakthroughs in core technologies in key fields to build a more self-supporting, safer, and more reliable industrial system with their risks better controlled. We will encourage leading enterprises in industrial chains to strengthen cooperation with upstream and downstream SMEs on technology research, production verification, and standards setting to enhance collaborative innovation and integrated development of industrial chains.
Second, we will consolidate the advantages and create new growth drivers. We will take active steps to reinforce advantages in key advantageous areas, enhance the competitiveness of traditional industries, and accelerate the deep integration of the new generation information technology and the manufacturing industry. We will work hard to develop the digital economy, seize new strategic opportunities, accelerate the development of new technologies, new forms and new models, and promote the development of advanced manufacturing clusters.
Third, we will guard against risks and ensure stable and smooth industrial and supply chains. We will improve the ability to identify and cope with risks, strengthen the monitoring of key areas and key industries, and strengthen synergies between departments and regions to enhance the ability to cope effectively with risks in a coordinated way. We will expedite the implementation of policies on benefiting enterprises and keeping business operations stable, and guarantee the supply of industrial production factors to ensure normal production and operations of enterprises to the maximum possible extent.
Thank you!
ThePaper.cn:
Recently, the demand for medicine and medical devices such as antipyretic and analgesic drugs and oxygen concentrators has increased. What is the current production and supply situation of medicine and medical devices? What's the MIIT's judgment about the next stage of their production and supply? Thank you.
Tian Yulong:
Thank you for your questions. Recently, the MIIT has implemented the decisions and deployments of the CPC Central Committee and the State Council in conjunction with relevant departments. Under the direct command of the joint COVID-19 prevention and control mechanism, the MIIT, leading this mechanism's medical supply support group, has further guaranteed access to medical supplies together with group member departments and relevant localities. We have also made every effort to help pharmaceutical and medical enterprises fulfill their production goals as well as stabilize and expand production and capacity. We have increased the supply of key drugs in the market and guided their reasonable, orderly, and precise distribution. The current characteristics are as follows:
First, we have made every effort to ensure the production and supply of key medical materials. In terms of drugs, as of Jan. 17, on the basis of maintaining a production capacity of 200 million tablets for 17 consecutive days, 5.14 billion tablets of two key antipyretic and analgesic drugs - ibuprofen and acetaminophen - have been supplied, which can fully meet the medicine demand. In terms of medical equipment and devices, as signs of higher demand for medical resources for severe case treatment emerge, the MIIT recently focused its work on "preventing severe cases and ensuring equipment supply" in a timely manner. As of Jan. 17, the daily output of Azvudine, a small-molecule antiviral drug, has increased by 148% to 744,000 bottles compared with before New Year's Day. Daily output and production capacity have been greatly improved, which can meet the medicinal needs of medical institutions for patients with severe conditions as well as subsequent severe cases. Currently, thanks to a rising scale in production, the daily output of invasive ventilators has increased by 239% to 1,808 units compared with that before New Year's Day. The daily output of oxygen concentrators has increased by 280% in four days, and the maximum daily output can exceed 20,000 units. The supply of oxygen concentrators has been able to meet the basic needs of medical institutions. The daily output of much-needed finger pulse oximeters has exceeded 460,000 units, which can not only meet the needs of medical institutions but can also gradually and sufficiently supply society's needs.
Second, we have conducted precise distribution to prioritize needs in key areas. We share people's concerns. In accordance with the principle of "focusing on key areas and providing targeted distribution," we have worked with relevant departments to actively align with the departments in charge of civil affairs, rural affairs, education, among others and provided targeted medical supplies for key areas (populations), such as in elderly care, rural areas, and schools. Since mid-December last year, we have delivered nearly 136 million doses of drugs through large e-commerce platforms and local drug support platforms, benefiting more than 60 million people in total. Thanks to the convenience and accessibility of e-commerce, we have created a precise distribution model. At the same time, we have equipped every rural clinic with two finger pulse oximeters and supplied 1.172 million finger pulse oximeters in four batches so as to bring finger pulse oximeters to rural areas. Meanwhile, through various financial drives, including corporate donations, more than 10,000 medical oxygen concentrators have been provided free of charge for more than 800 counties lifted out of poverty across the country, fully covering 10,000-plus towns and townships in these counties. We have fully met the needs of key medical supplies for old-age care and child welfare institutions nationwide, as proposed by the civil affairs departments. Currently, we are working with education departments to ensure that the needs of universities for key medical supplies nationwide are satisfied.
Third, we have smoothed the supply channels of medical supplies through various cooperations. We have worked with the transport and postal departments to prioritize delivering urgently-needed medical materials at the community level, especially in rural and remote areas, and spared no effort to link up the "last kilometer" of delivery. We have also formulated a plan to guarantee smooth logistics of enterprises during the Spring Festival and strived to ensure transport and reserve capacities during the Spring Festival and other holidays.
Next, the MIIT will continue to further support the stable production of key medical material enterprises, strengthen supplies, targeted coordinated distribution, and never reduce its efforts in ensuring supplies.
Thank you!
_ueditor_page_break_tag_CGTN:
As we all know, China has been adhering to the path of green development. Especially since the carbon peak and carbon neutrality goals were put forward, a green and low-carbon transformation has been further accelerated across society. What are the future considerations of the MIIT regarding energy saving, carbon reduction, and green transformation in the industrial sector? Thank you.
Tian Yulong:
Thank you, and I'll give the floor to Ms. Tao Qing for this question.
Tao Qing:
Thank you for your question. Industry is the backbone of the national economy and its engine of growth. It is also an important battlefield for promoting green development transformation. The MIIT has thoroughly implemented the guiding principles of the 20th CPC National Congress and earnestly promoted a green and low-carbon transformation of the manufacturing industry.
First, the action plan for peaking industrial carbon emissions has been carried out in an orderly manner. Together with the National Development and Reform Commission and the Ministry of Ecology and Environment, we have issued an implementation plan for carbon peak in the industrial sector and coordinated in mapping out a timetable and a roadmap for peaking industrial carbon emissions.
Second, solid progress has been made in industrial green transformation and development. We have thoroughly implemented the plan for the green development of China's industrial sectors during the 14th Five-Year Plan period (2021-2025), introduced and implemented a package of schemes and action plans for improving energy and water efficiency, as well as comprehensive utilization of resources, and formulated the measures for supervision and inspection on industrial energy conservation. We have organized energy conservation monitoring on 3,572 key enterprises, and provided diagnostic services for 124 key enterprises and 1,187 specialized and sophisticated SMEs that produce new and unique products.
Third, green and low-carbon models have been cultivated and expanded. A number of national green factories, green industrial parks, and green supply chain enterprises have been selected. In addition, 99 green design demonstration enterprises, 282 enterprises meeting the industrial standards and conditions, and 32 pilot enterprises (parks) recycling industrial wastewater have been cultivated.
Fourth, the popularization and application of green and low-carbon technologies have been accelerated. Efforts have been intensified to popularize and apply advanced techniques, technologies, and equipment for energy and water-saving plans, cleaning and environmental protection, and comprehensive utilization of resources. Various supply-demand matching and technical training exchanges have been held online and offline.
Next, the MIIT will earnestly implement the guiding principles of the 20th CPC National Congress and the Central Economic Work Conference, take the carbon peak and carbon neutrality goals as the leading principles, take promoting green and high-quality development of the manufacturing industry as its own responsibility, and advance carbon and pollution reduction, green expansion, and growth in a coordinated manner so that green development can become the defining feature of the new type of industrialization.
First, we will accelerate the green and low-carbon transformation of the manufacturing industry. We will formulate and introduce the Guidelines for Accelerating the Green and High-Quality Development of the Manufacturing Industry, clarify the implementation measures, give differentiated guidance, and implement industry-specific policies, as well as promote the green and low-carbon development transformation of key industries, parks, enterprises, and localities in an integrated manner.
Second, we will conduct special actions for industrial energy conservation and carbon reduction. We will fully implement the carbon peak plans in the industry and key sectors. We will continue to monitor national energy conservation, and carry out in-depth activities providing industrial energy conservation diagnostic services and energy conservation services to enterprises. We will launch a number of pilot projects, including developing industrial green microgrids and digital carbon management systems.
Third, we will advance green manufacturing. On the basis of building green factories, we will accelerate the construction of the green manufacturing system and improve the evaluation index system in accordance with the new goals of achieving carbon peak and carbon neutrality.
Fourth, we will promote improving quality and efficiency in the comprehensive utilization of resources. We will carry out projects to optimize battery recycling and utilization and improve the recycling and utilization system. We will strengthen the standardized management of comprehensive utilization industries of renewable resources such as scrap steel and waste paper, promote the pilot implementation of extended producer responsibility for automobile products, and improve our ability to utilize complex and hard-to-use solid waste and emerging solid waste. We will update and publish the catalog of advanced and applicable technologies for the comprehensive utilization of industrial resources.
Fifth, we will strive to improve the level of clean industrial production. We will coordinate and promote green and high-quality development in the Beijing-Tianjin-Hebei region, along the Yangtze Economic Belt, and other areas. In particular, we will focus on steel, petrochemical, chemical, and other key water-using industries to carry out pilot recycling projects for industrial wastewater.
Sixth, we will foster new drivers of green growth. We will vigorously develop green and environmental protection industries and cultivate key enterprises with advantages. We will improve the mechanism for promoting green transformation and guide fiscal and financial resources to increase support for the green development of the manufacturing industry.
Thank you!
_ueditor_page_break_tag_Economic Daily:
As we know, the monthly data of value added of industrial enterprises above the designated size fluctuated markedly last year. How to evaluate the industrial performance for the whole year? Will the trend of recovery continue this year? Thanks.
Tian Yulong:
Thanks for your questions. As I said in my opening remarks, the industrial economy in 2022 faced a relatively severe and complex environment both at home and abroad, and was under great pressure to ensure steady growth.
Over the past year, under the support from all regions and departments, the MIIT put steady growth as its top priority, adopted a series of measures to achieve recovery of the industrial economy in a short time, and maintained sound momentum, demonstrating the "ballast" role of the industrial economy in the macroeconomic performance, as well as contributing China's share in stabilizing the global industrial and supply chains and in promoting the recovery of world economy.
Overall, the value added of industrial enterprises above the designated size grew 3.6% year on year in 2022. The first quarter got off to a good start with a sound momentum, while it fell sharply in April and began to stabilize and rally again in May. This fluctuation was relatively large. In the fourth quarter, the downward pressure increased because of the pandemic. But on the whole, the positive trend of stability has remained unchanged. In terms of industries, key industries generally performed stably. In particular, the equipment manufacturing industry registered fast growth. In 2022, the value added of this sector grew 5.6%, contributing 50.3% to the overall industrial growth. Among them, a representative sector, including electric machinery as well as instruments and meters, increased by 11.9% and 4.6%, respectively. The automobile industrial and supply chains were fully restored, with annual production and sales rising by 3.4% and 2.1%, respectively, in 2022. Generally, the driving power of the equipment manufacturing sector was very strong. Raw material for manufacturing was growing despite of the pressure. In 2022, the value added of the sector rose 1.6% year on year, with the first three quarters running at a low level, and the growth accelerated since September. The consumer goods manufacturing gradually recovered. In 2022, the value added of the sector grew 0.6% year on year. Daily necessities industry such as food, agricultural and non-staple food, wine, beverage, and refined tea maintained certain growth.
In terms of key products, products of new energy and new drivers of growth grew rapidly, and daily necessities rose steadily. The production and sales of new energy vehicles reached 7.058 million and 6.887 million, up 96.9% and 93.4% year on year, respectively, while the output of charging piles and solar panels soared by 80.3% and 47.8% year on year, respectively. New material products grew at a high level - the production of polysilicon and monocrystalline silicon, for example, grew rapidly, reaching 64.4% and 51.8%. High-tech products also posted rapid growth, with the output of mobile communication base station equipment as well as the industrial control computers and systems increasing by 16.3% and15.0% respectively. We have guided enterprises to focus on the needs of the people and increased the production and processing of related products to effectively meet consumer needs. The output of flash frozen food and dairy products rose 3.3% and 2.0%, respectively, and the woolen fabrics up 4.7%.
In terms of regions, most provinces saw their industrial economy recovering steadily. Last year, 24 of the 31 provinces, autonomous regions and municipalities directly under the central government logged growth to value added to industry. Among them, major industrial provinces such as Jiangsu, Shandong, Zhejiang, Henan, Fujian, Sichuan, Hubei, Hunan, and Hebei posted higher growth rates than the national level. The growth rate of major economic indicators in the central and western regions took the leading position. Last year, the value added of industry of these regions increased by 6.8% and 6.2%, respectively; while the eastern region raised 3.0% year on year, showing steady signs of recovery.
In 2023, the external environment remains complex, and the development of the industrial sector is still under great pressure. However, in general, the growth trend and pattern remain unchanged, and the economic fundamentals that will sustain long-term growth have been stabilized and consolidated. We believe that with the effective release of the vitality of market entities, the potential of consumer consumption, and the impetus for industrial upgrading, the steady recovery of the industrial economy will keep unchanged so as to provide stronger support for the macroeconomy.
That's all for me. Thanks!
_ueditor_page_break_tag_Southern Metropolis Daily:
We noticed that the MIIT recently solicited public opinion on further improving the service capacity of mobile internet applications, aiming to optimize the services and enhance user experience. What achievements has the MIIT made in promoting ICT serving people's livelihoods in the past year? What's the next plan? Thanks.
Zhao Zhiguo:
Thank you for your question. The MIIT attaches great importance to the protection of users' rights and interests and personal information, and continues to improve the ICT capacity and services so as to effectively protect the legitimate rights and interests of users.
First, the quality of services has been improved, and user perception has been refined constantly. We launched campaigns to improve service perception and guided information and communications enterprises to provide quality services. We optimized the business handling process, realized online and remote telecommunication services such as plans change, contract cancellation, and other common services; promoted 100 key internet enterprises to establish customer service hotlines with real person responding to users' demands timely; prompted app stores to improve their review mechanism before launching an app. By the end of last year, the number of various high-quality apps in use exceeded 2.58 million in China, and intelligent applications have enriched people's production and life.
Second, we have improved the accessibility of convenient digital services. More solid outcomes have been delivered and shared by all. We have continued to expand the coverage of the internet, further promoted universal telecom services, supported rural and remote areas to speed up the coverage of the internet, and worked hard to realize broadband connection in all administrative villages nationwide for the first time in history. We have also adopted targeted fee cut measures like preferential policies for special groups such as micro-, small- and medium-sized enterprises (MSMEs), poor households, the elderly, and the disabled. As a result, the average rates for broadband and dedicated internet access services for MSMEs have dropped by 24.2% and 21.9%, respectively, as compared with those in December 2021. More than 32 million households of seniors and disabled people have benefited from the measures, doubling the number in 2021. By doing so, users are increasingly feeling the benefit. We have steadily improved telecom services for the convenience of senior citizens by facilitating usage and improving service quality. Enterprises have been encouraged to provide elderly users with telecom services that can be handled remotely and to resolve technical difficulties for them. A total of 648 websites and apps have finished such improvements.
Third, we have improved oversight effectiveness. Protection of users' rights and interests has been strengthened. We have enhanced management at the source, urged and guided app stores and other distribution platforms to fully harness the role of "goalkeepers," so that apps are reviewed and hit the shelves in accordance with laws and regulations. In 2022, we conducted tests on 1.51 million apps in six batches, achieving a much higher percentage of passing than in 2021. We have built a strong technology shield and established an anti-fraud platform in the ICT industry. Since 2022, we have intercepted a total of 1.82 billion scam phone calls. Cyber security and protection have been increasingly strengthened. We have improved the governance model, curbed spamming on an ongoing basis, intensified administrative guidance, and made regulatory bodies get involved at earlier stages. By doing so, complaints from users dropped to the lowest level in history.
ICT services concern the interests of hundreds of millions of users. Providing high-quality services is an important part in pursuing a people-centered development philosophy. Next, we will focus on our work in three aspects.
First, we will enhance policy guidance to foster an enabling environment for the industry. We will take action to increase the service capacity of mobile applications so that both service supply and user experience will be improved. We will also build a public service platform involving mobile applications to efficiently support the regulation and development of the industry. In addition, we will develop sound systems to coordinate our work, strengthen the self-discipline of the telecom industry, and create an enabling environment for its healthy and orderly development.
Second, we will focus on key problems to address the concerns and aspirations of the people, such as personal information protection and telecom and internet fraud. We will strengthen the regulation of apps at all stages for all entities, urge app stores, terminals, and other key links to fulfill their primary responsibility, and realize joint prevention and governance throughout the industrial chain. We will also accelerate the establishment of a united resource database for the industry to combat fraud, and step up efforts to promote the service that enables citizens to inquire about all mobile phone cards registered under their own ID numbers. Integrated protection capacity will be enhanced, and a sound environment for information consumption will be jointly fostered.
Third, we will step up efforts to improve our capacity to benefit the public and provide more convenient services. We will advance online and cross-regional handling of telecom services, carry out consumer satisfaction measurement of key internet services, speed up the improvement of websites and apps with local features, and provide more comprehensive, considerate, and satisfactory ICT services.
Thank you.
Shangyou News:
Rapid development of the green energy equipment industry is one of the important areas of forging new industrial competitive strengths of green and low-carbon industries. How did the situation of the green energy equipment industry develop in 2022? What new measures will be taken next to further boost the industry? Thank you.
Tao Qing:
Thank you for your questions. To develop the green energy equipment industry is an important measure to promote green and low-carbon development and achieve our carbon peak and neutrality targets. In recent years, the MIIT has worked with relevant departments to issue and implement an action plan to improve energy efficiency in industries, making a big push to develop the green energy equipment industry.
First, we have accelerated the promotion of high-efficiency and energy-saving equipment. We issued a catalog of selected and recommended energy-saving technologies and equipment in the field of industry and information technologies. Also, we moved faster to promote 133 pieces of energy-saving equipment, including high-efficiency electric motors, transformers, compressors, and draught fans.
Second, we have built up manufacturing capability and competitive production capacity in the whole industrial chain of renewable energy, including wind and photovoltaic power and lithium-ion batteries. At the end of 2022, China led the world with the photoelectric conversion efficiency of self-developed silicon heterojunction cells. The output of wind power generators in China accounted for two-thirds of the world's total. The single-unit capacity continued to grow, with the capacity of the latest developed onshore wind power generator exceeding 6 MW. In 2022, the newly installed capacity of wind and photovoltaic power reached more than 120 million kW, and their cumulative installed capacity exceeded 700 million kW, driving the installed capacity of renewable energy to exceed 1.2 billion kW.
Next, we will stick to our carbon peak and neutrality targets, implement the plan to improve the energy efficiency of electric motors and transformers, organize the compiling of the energy-saving technologies and equipment catalogs in the field of industry and information technologies, and hold a series of themed events at enterprises to promote energy conservation service. By speeding up the development of the green energy equipment industry and e-energy industry in the field of wind, solar, and hydroelectric power, hydrogen energy, and energy storage, we will push green and low-carbon development to a new level and make a positive contribution to the green transition in all respects of economic and social development.
Thank you.
_ueditor_page_break_tag_People's Post and Telecommunications News:
We have seen that the ICT sector achieved steady and rapid growth in 2022. What are the main achievements? What other work considerations are there for this year? Thank you.
Zhao Zhiguo:
Thank you for your question. In 2022, the MIIT conscientiously implemented the decisions and plans of the CPC Central Committee and the State Council, made stability our top priority, and pursued progress while ensuring stability, promoting the high-quality development of the ICT sector to achieve new results with a strong sense of responsibility and mission.
The first achievement is that we have created new highlights, and the scale of the ICT industry has continued to grow. The annual telecommunications services revenue was 1.58 trillion yuan, a year-on-year increase of 8%, injecting impetus into economic growth empowerment and boosting market confidence. We continuously optimized the industry structure, with the revenue of emerging businesses such as internet data centers, cloud computing, and the Internet of Things increasing by 32.4% year on year, driving the growth of telecommunications services revenue by 5.1 percentage points and becoming an important growth pole of the telecommunications services. The effective investment was steadily expanded. The investment in telecommunications fixed assets for the year reached 419.3 billion yuan, a year-on-year increase of 3.3%, and the growth rate of investment remained stable. Consumption vitality was effectively stimulated, mobile internet traffic increased by 18.1% year on year, and national online retail sales reached 13.8 trillion yuan, a year-on-year increase of 4%, driving both the quantity and quality of information consumption to increase.
The second achievement is that we have consolidated the new base, and the infrastructure construction has achieved remarkable results. We worked in coordination to promote the "Double Gigabit" networks construction, and a total of 2.312 million 5G base stations have been built and the gigabit optical networks have been expanded to be able to cover more than 500 million households, realizing "every city is covered by the gigabit optical network" and "every county can access 5G services." We coordinated the layout of data and computing power facilities, with the total number of data center racks in use across the country now exceeding 6.5 million standard racks and the average annual growth rate of the total computing power exceeding 25% in the past five years. We continued to optimize internet network architecture, added five national-level internet backbone direct connection points, increased the interconnection bandwidth to 38T, built four new switching centers, and accelerated the formation of an all-round, multi-level, three-dimensional network interconnection architecture, with the network service performance reaching an internationally advanced level.
The third achievement is that we have opened up "a new track," and the process of industrial digitalization continues to accelerate. In terms of industries, the integration of information and communications applications has accelerated to expand and deepen in the fields of industry, medical care, education, and transportation. The number of virtual private networks in the 5G industry has exceeded 10,000, and the number of mobile Internet of Things connections accounts for 70% of the global total. The industrial internet has been fully integrated into 45 major categories of the national economy. In terms of individual users, the number of apps has exceeded 2.58 million, enriching various user needs in consumption, entertainment, social networking, travel, etc., and comprehensively improving quality of life, and promoting the formation of the world's largest and most active digital service market.
Going forward, the MIIT will thoroughly implement the spirit of the 20th CPC National Congress and the plans of the Central Economic Work Conference; ensure both development and security; focus on consolidating foundations, promoting applications, and ensuring security; and consolidate the leading position of the information and communications industry in a bid to serve the high-quality development of the digital economy.
The first is to build high-quality information infrastructure. We will accelerate the in-depth coverage of the "Double Gigabit" networks; implement gigabit city construction actions; build an integrated computing power infrastructure application system with cloud-edge-terminal collaboration and integration of computing, storage, and operation; launch the "Broadband Frontier" project for universal telecommunications services; and promote high-quality development of the mobile Internet of Things, smoothing the information artery.
The second is to cultivate high-level integrated innovative applications. We will vigorously promote the integrated application of new-generation ICT such as 5G and gigabit optical networks in information consumption, vertical industries, people's wellbeing, and digital government. We will also promote the large-scale application of the industrial internet so as to lead the high-end, intelligent, and green development of industries.
The third is to build a highly reliable network security line of defense. We will comprehensively promote the construction of basic telecommunications network security capabilities, deepen the construction of data security management systems and supervision practices in the field of industry and information technology, advance the development of network and data security industries, and improve the network security system based on the security of network facilities, focusing on data security and supported by the security industry.
Thank you.
_ueditor_page_break_tag_Hong Kong Bauhinia Magazine:
SMEs provide important support for China's economic resilience and are related to overall economic and social development. May I ask how the operation and development of SMEs were in 2022? What measures did the MIIT introduce to help and solve the difficulties of SMEs? Thank you.
Tian Yulong:
Thank you for your question. I will answer this question. The whole of society pays close attention to SMEs. SMEs connect thousands of households and are also an important force in promoting innovation, employment, and improve people's livelihoods. Since 2020, due to the continuous impact of the epidemic, SMEs have been greatly impacted and faced difficulty in business operations. Under the strong leadership of the CPC Central Committee and the State Council, especially by giving full play to the role of the leading group of the State Council for promoting the development of SMEs, the MIIT, together with relevant departments, has introduced a series of policies and measures to help SMEs ease their difficulties and develop healthily and steadily. Some measures have been taken in the following aspects.
In terms of tax and fee reductions in 2022, tax cuts, fee reductions, tax refunds, and tax and fee deferrals added up to more than 4 trillion yuan for various market entities throughout the year, with about 4% being enjoyed by small and micro-enterprises. In terms of increasing financing, as of the end of November 2022, the national inclusive small and micro-enterprise loan balance reached 23.2 trillion yuan, a year-on-year increase of 23.7%. In addition, the National Small and Medium Enterprises Development Fund has led social capital to invest a total of 35 billion yuan, which has played a very good role in alleviating loan difficulties. In terms of corporate innovation, we have established a gradient cultivation system for high-quality SMEs, accumulatively cultivating 8,997 national-level "little giant" enterprises with high growth potential, advanced technology and strong market competitive edge, and over 70,000 provincial-level SMEs with such strengths. In terms of services, in 2022, we launched the "Together to Benefit Enterprises" service action for SMEs, organized various high-quality resources, and provided policies, management, and technologies. We have provided more than 50 million services to SMEs. Their feelings are good. At the same time, we actively carried out special actions to prevent and resolve payment arrears to SMEs and promote the clearing of undisputed arrears in the ledger. Recently, the office of the leading group issued "Measures for Assisting in Growth Stabilization, Structural Adjustment, and Capacity Enhancement of MSMEs." The move was reported in various news outlets. The document put forward 15 specific measures to help MSMEs solve difficulties and achieve high-quality, sustainable development, especially focusing on their current difficulties and problems and based on a dual strategy of both easing difficulties and providing service, and adjusting structure and building up capabilities in parallel.
With the support of these policies, the vast number of SMEs have continued to strive for self-improvement, rise up to challenges, and overcome various difficulties to achieve stable production and operations. According to the National Bureau of Statistics, from January to November 2022, the number, operating income, and total profit of industrial SMEs above the designated size increased by 10.5%, 6.0%, and 0.3% year-on-year, respectively, demonstrating SMEs' strong resilience and vitality. A survey conducted by MIIT of 43,000 SMEs shows that in 2022, nearly 40% of enterprises had new loans, more than 60% of enterprises invested in research and development, and more than 60% of enterprises invested in fixed assets, demonstrating their growing confidence in development. At the same time, we conducted a survey of more than 1,800 "little giant" enterprises with high growth potential, advanced technology and strong market competitive edge, and found that from January to November, the profit margin of operating income of "little giant" enterprises was 10.7%, which was 5.2 percentage points higher than that of industrial enterprises above the designated size.
In 2023, the difficulties and challenges for the stable development of SMEs remain big. In this regard, all departments and localities need to join efforts. In accordance with the plans of the Central Economic Work Conference, we will continue to work unswervingly both to consolidate and develop the public sector and to encourage, support and guide development of the non-public sector. We will further strengthen policies and measures to promote the high-quality development of SMEs, including improving the policies and environment for their development, providing better services, encouraging innovation and cultivating talents.
Thank you.
Xing Huina:
If you have no more questions, today's briefing is hereby concluded. Thank you to the three speakers and friends from the media. Goodbye.
Translated and edited by Zhang Tingting, Li Huiru, Xu Xiaoxuan, Zhou Jing, Yan Bin, Yuan Fang, Li Xiao, Liu Sitong, Xu Kailin, Liu Qiang, Wang Qian, Zhu Bochen, Daniel Xu, and Tom Arnsten. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Kang Yi, commissioner of the National Bureau of Statistics (NBS)
Fu Linghui, spokesperson of the NBS and director general of the Department of Comprehensive Statistics of the NBS
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Jan. 17, 2023
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by Mr. Kang Yi, commissioner of the National Bureau of Statistics (NBS), who will introduce the situation and answer your questions. We also have with us Mr. Fu Linghui, spokesperson of the NBS and director general of the Department of Comprehensive Statistics of the NBS.
Now, I'll give the floor to Mr. Kang for a brief introduction.
Kang Yi:
Ladies and gentlemen, friends from the media, good morning! Welcome to today's press conference. It's a great pleasure to meet you. I'll begin by introducing China's economic performance in 2022 and then answer your questions.
In 2022, faced with challenges of high winds and choppy waters in the global environment as well as arduous tasks to advance reform, promote development, and maintain stability at home, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, all regions and departments strictly implemented the decisions and arrangements made by the CPC Central Committee and the State Council, adhered to the general working guideline of making progress while maintaining stability, coordinated the work of epidemic prevention and control and economic and social development in an effective way, and responded to the internal and external challenges effectively. As a result, the national economy continued to develop despite downward pressure, the economic output reached a new level, employment and prices were generally stable, people's lives were continuously improved, new achievements were secured in high-quality development, and the overall economic and social development was stable and healthy.
According to preliminary estimates, the gross domestic product (GDP) was 121,020.7 billion yuan in 2022, an increase of 3% over last year at constant prices. Looking at industries at various levels, the value added of the primary industry was 8,834.5 billion yuan, up by 4.1% over last year; the value added of the secondary industry was 48,316.4 billion yuan, up by 3.8%; and the value added of the tertiary industry was 63,869.8 billion yuan, up by 2.3%. In terms of quarterly data, the GDP in the first quarter was up 4.8% year on year, up 0.4% in the second quarter, up 3.9% in the third quarter, and up 2.9% in the fourth quarter. The quarter-on-quarter growth of GDP in the fourth quarter stayed the same as in the third quarter.
First, the grain output increased and production of animal husbandry grew steadily.
The total output of grain in 2022 was 686.53 million metric tons, an increase of 3.68 million metric tons over the previous year, or up by 0.5%. Of this total, the output of summer grain was 147.4 million metric tons, up by 1%, and that of early rice was 28.12 million metric tons, up by 0.4%. The output of autumn grain reached 511 million metric tons, up by 0.4%. By species, the output of rice was 208.49 million metric tons, down by 2%; wheat, 137.72 million metric tons, up by 0.6%; corn, 277.2 million metric tons, up by 1.7%; soybeans, 20.28 million metric tons, up by 23.7%. The output of oil-bearing crops was 36.53 million metric tons, up by 1.1%. The total output of pork, beef, mutton, and poultry in 2022 was 92.27 million metric tons, up by 3.8% over the previous year. Of this total, the output of pork was 55.41 million metric tons, up by 4.6%; beef, 7.18 million metric tons, up by 3%; mutton, 5.25 million metric tons, up by 2%; poultry, 24.43 million metric tons, up by 2.6%. The production of milk reached 39.32 million metric tons, up by 6.8% and that of eggs stood at 34.56 million metric tons, up by 1.4%. At the end of 2022, 452.56 million pigs were in stock, up by 0.7%, and 699.95 million pig were slaughtered in 2022, up by 4.3%.
Second, industrial production experienced sustained development, and high-tech manufacturing and equipment manufacturing grew by leaps and bounds.
The total value added of industrial enterprises above the designated size increased by 3.6% over the previous year. In terms of sectors, the value added of mining was up by 7.3%, the value of manufacturing went up by 3%, and the value of production and supply of electricity, thermal power, gas, and water increased by 5%. The value added of the high-tech manufacturing and equipment manufacturing went up by 7.4% and 5.6%, respectively, 3.8 percentage points and 2 percentage points faster than the value added of industrial enterprises above the designated size. In terms of ownership, the value added of state holding enterprises grew by 3.3%, that of the share-holding enterprises went up by 4.8%, that of the enterprises funded by foreign investors and investors from Hong Kong, Macao, and Taiwan dropped by 1%, and that of private enterprises grew by 2.9%. By products, the production of new energy vehicles, mobile communication base stations, and industrial control computer and system grew by 97.5%, 16.3%, and 15%, respectively. In December, the total value added of the industrial enterprises above the designated size grew by 1.3% year on year, up by 0.06% month on month. In the first 11 months, the total profits made by industrial enterprises above the designated size were 7,718 billion yuan, down by 3.6% year on year.
Third, the service sector sustained its recovery with modern service industries demonstrating a sound momentum of growth.
The value added of services went up by 2.3% year on year in 2022. The value added of information transmission, software, and information technology services and that of financial services grew by 9.1% and 5.6%, respectively. In December, the Index of Services Production went down by 0.8% year on year, the decline narrowed by 1.1 percentage points compared with that of the previous month. In the first 11 months, the business revenue of service enterprises above the designated size grew by 3.9% year on year, of which the revenues of the information transmission, software, and information technology services, scientific research and technology services, and health and social services went up by 8.3%, 8.3%, and 8.1%, respectively.
Fourth, the scale of market sales was basically stable with sales of basic living goods and online retail sales growing at a fast pace.
In 2022, the total retail sales of consumer goods reached 43,973.3 billion yuan, down by 0.2% over the previous year. Analyzing by different areas, the retail sales in urban areas reached 38,044.8 billion yuan, down by 0.3%. The retail sales in rural areas stood at 5,928.5 billion yuan, the same as that of the previous year. Grouped by consumption patterns, retail sales totaled 39,579.2 billion yuan, up by 0.5%, and the revenue of food and beverage amounted to 4,394.1 billion yuan, down by 6.3%. Spending on basic living goods increased steadily, with the retail sales of grain, oil, and food and that of beverages by enterprises above the designated size growing by 8.7% and 5.3%, respectively, over the previous year. In 2022, the national online retail sales reached 13,785.3 billion yuan, growing by 4% over 2021. Specifically, the online retail sales of physical goods totaled 11,964.2 billion yuan, up by 6.2%, accounting for 27.2% of the total retail sales of consumer goods. In December, the total retail sales of consumer goods went down by 1.8% year on year, a decline narrowed by 4.1 percentage points than that of the previous month and a month-on-month decline of 0.14%.
Fifth, investment in fixed assets increased steadily, and investment in high-tech industries maintained a good momentum of growth.
In 2022, investment in fixed assets (excluding rural households) reached 57,213.8 billion yuan, up by 5.1% over the previous year. Specifically, infrastructure investment went up by 9.4%, manufacturing investment grew by 9.1%, and investment in real estate development declined by 10%. The floor space of commercial buildings sold reached 1,358.37 million square meters, down by 24.3%. The total sales of commercial buildings was 13,330.8 billion yuan, down by 26.7%. By industries, the investment in the primary, secondary, and tertiary industries went up by 0.2%, 10.3%, and 3%, respectively. Private investment went up by 0.9%. Investment in high-tech industries grew by 18.9%, 13.8 percentage points faster than total investment growth. Specifically, investment in high-tech manufacturing and high-tech services grew by 22.2% and 12.1%, respectively. Among investments in high-tech manufacturing, those in manufacturing of medical equipment, measuring instruments and meters grew by 27.6%, and electronics and communication equipment manufacturing grew by 27.2%. In terms of high-tech services, investment in services for transformation of scientific and technological achievements and investment in research, development, and design services went up by 26.4% and 19.8%, respectively. Investment in the social sector went up by 10.9%. Specifically, investments in health and education went up by 27.3% and 5.4%, respectively. In December, investment in fixed assets (excluding rural households) grew by 0.49% month on month.
Six, import and export of goods grew fast, and the trade structure continued to receive optimization.
In 2022, the total value of import and export of goods was 42,067.8 billion yuan, an increase of 7.7% over last year. The total value of export was 23,965.4 billion yuan, up by 10.5%; the total value of import was 18,102.4 billion yuan, up by 4.3%. The country registered a trade surplus of 5,863 billion yuan. The import and export of general trade goods increased by 11.5%, accounting for 63.7% of the total value of import and export, an increase of 2.2 percentage points compared with last year. The import and export of private enterprises grew by 12.9%, accounting for 50.9% of the total value of import and export, 2.3 percentage points higher than that of last year. The import and export of mechanical and electrical products grew by 2.5%, accounting for 49.1% of the total value of import and export. In December, the total value of import and export of goods was 3,771.3 billion yuan, up by 0.6% year on year. Specifically, the total value of imports was 1,610.6 billion yuan, up by 2.2%, the total value of exports was 2,160.7 billion yuan, down by 0.5%.
Seventh, consumer price saw mild growth, and growth of producer prices for industrial products went down.
In 2022, the consumer price index (CPI) went up by 2% over last year. Grouped by commodity categories, prices of food, tobacco, and alcohol went up by 2.4%; prices of clothing grew by 0.5%; housing prices increased by 0.7%; prices of articles and services for daily use went up by 1.2%; transportation and communication prices were up by 5.2%; prices of education, culture, and recreation grew by 1.8%; medical services and health care prices went up by 0.6%; and prices of other articles and services increased by 1.6%. In terms of food, tobacco, and alcohol prices, pork went down by 6.8%, grain up by 2.8%, fresh vegetables up by 2.8%, and fresh fruits up by 12.9%. Core CPI excluding the prices of food and energy went up by 0.9%. In December, consumer prices went up by 1.8% year on year, and maintained the same level of growth month on month. In 2022, producer prices for industrial products went up by 4.1% over last year. It went down by 0.7% year on year in December, and down by 0.5% month on month. The purchasing prices for industrial producers went up by 6.1% over last year, and in December, it went up by 0.3% year on year, and down by 0.4% month on month.
Eight, employment was generally stable, and surveyed unemployment rate in urban areas dropped slightly.
In 2022, 12.06 million people in urban areas became newly employed, exceeding the expected annual goal of 11 million. In December, the surveyed unemployment rate in urban areas was 5.5%, 0.2 percentage point lower than the previous month. The surveyed unemployment rate of people with local household registrations was 5.4%, and that of people with non-local household registration was 5.7%. The surveyed unemployment rate of people with non-local agricultural household registration stood at 5.4%. Specifically, the surveyed unemployment rate of the people aged from 16 to 24 was 16.7%, 0.4 percentage point lower than that of the previous month; that of people aged from 25 to 59 was 4.8%, 0.2 percentage point lower than that of the previous month. The urban surveyed unemployment rate in 31 major cities was 6.1%, 0.6 percentage point lower than that of the previous month. The employees of enterprises worked 47.9 hours per week on average. In 2022, the number of rural migrant workers totaled 295.62 million, 3.11 million more than that of last year, up by 1.1%. Specifically, 123.72 million of them were local migrant workers working in the vicinity of their place of home, up by 2.4%; while 171.9 million worked at more distant places in their home province or in regions far away, up by 0.1%. The average monthly income of migrant workers was 4,615 yuan, up by 4.1% over last year.
Ninth, resident income grew generally at the same pace as economic growth, and income of rural residents grew faster than that of urban residents.
In 2022, the nationwide per capita disposable income of residents was 36,883 yuan, a nominal increase of 5% over that of last year, and a real increase of 2.9% after deducting price factors, which was generally at the same pace with the growth of the economy. In terms of permanent residents, the per capita disposable income of urban households was 49,283 yuan, a nominal growth of 3.9% and a real growth of 1.9% after deducting price factors. The per capita disposable income of rural households was 20,133 yuan, a nominal growth of 6.3% and a real growth of 4.2% after deducting price factors. The median of the nationwide per capita disposable income was 31,370 yuan, a nominal increase of 4.7% over that of last year. Taking the per capita disposable income of nationwide households by income quintile, that of the low-income group reached 8,601 yuan, the lower-middle income group 19,303 yuan, the middle income group 30,598 yuan, the upper-middle income group 47,397 yuan, and the high income group 90,116 yuan. In 2022, the nationwide per capita consumption expenditure was 24,538 yuan, a nominal growth of 1.8%, or a real decline of 0.2% after deducting price factors.
Tenth, total population declined and urbanization rate continued to grow.
By the end of 2022, the national population was 1,411.75 million (including the population of 31 provinces, autonomous regions, and municipalities, as well as military service personnel, but excluding residents of Hong Kong, Macao, and Taiwan and foreign nationals residing in the 31 provinces, autonomous regions, and municipalities), a decrease of 0.85 million over that at the end of 2021. In 2022, the number of births was 9.56 million with a birth rate of 6.77‰; the number of deaths was 10.41 million with a mortality rate of 7.37‰; the natural population growth rate was minus 0.6‰. In terms of gender, the male population was 722.06 million, and the female population was 689.69 million; the sex ratio of the total population was 104.69 males to 100 females. In terms of age structure, the population in the working age group from 16 to 59 was 875.56 million, accounting for 62% of the total population; the population aged 60 and over was 280.04 million, accounting for 19.8% of the total; the population aged 65 and over was 209.78 million, accounting for 14.9% of the total. In terms of urban-rural structure, permanent residents in urban areas totaled 920.71 million, an increase of 6.46 million over the end of the previous year; and permanent residents in rural areas amounted to 491.04 million, a decrease of 7.31 million. The share of urban population in the total population (urbanization rate) was 65.22%, 0.5 percentage point higher than that at the end of the previous year.
Generally speaking, positive results have been achieved in effectively coordinating COVID-19 prevention and control and economic and social development in 2022, with stabilized macroeconomic performance, continuously expanded economic output, and steadily improved development quality. However, the foundation of domestic economic recovery is not solid as the international situation is still complicated and severe, while the domestic triple pressure of demand contraction, supply shock, and weakening expectations is still looming. In the next stage, we must take Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guideline, fully implement the guiding principles of the 20th National Congress of the Communist Party of China as well as the decisions and arrangements made by the Central Economic Work Conference, make economic stability our top priority, and pursue progress while ensuring stability. We will better coordinate epidemic prevention and control with economic and social development, ensure better coordination in pursuing development and upholding security, deepen reform and opening-up in all respects, boost market confidence and stabilize growth, employment, and prices, so as to promote overall improvement of economic performance, and achieve effective enhancement of quality and reasonable growth of quantity.
That's all for my introduction. Thank you.
Shou Xiaoli:
Thank you for your introduction, Mr. Kang. Now we will open the floor for questions. Please identify the media outlet you represent before raising a question.
_ueditor_page_break_tag_CCTV:
China's economy was affected by multiple factors beyond expectations in 2022, including the international situation, domestic COVID-19 outbreaks, high temperatures and drought. What's your view on the performance of China's economy in 2022? Moreover, China's GDP surpassed 120 trillion yuan in 2022, so what does that mean for the Chinese economy? Thank you.
Kang Yi:
Thank you for your questions. It is indeed very important to review the past year. In 2022, we faced profound changes and a pandemic, both unseen in a century, the geopolitical situation was volatile and unstable, and downward risks in the global economy increased. Meanwhile, the domestic economy was affected by multiple factors beyond expectations, including sporadic resurgences of COVID-19 and extremely high temperatures. Moreover, the triple pressure of demand contraction, supply shocks and weakening expectations continued to evolve. Furthermore, the environment for development became more complicated, challenging and uncertain. Confronted with a complex and volatile international environment and formidable tasks in promoting reform, development, and stability at home, the CPC Central Committee with Comrade Xi Jinping at its core united and led the whole Party and Chinese people of all ethnic groups in rising to these challenges head-on and dealing with them calmly, considering both domestic and international dynamics, coordinating the COVID-19 response with socioeconomic development, ensuring both development and security, and stepping up macro regulation, and as the result, the impact of factors beyond expectation has been handled effectively, the overall performance of the macroeconomy has been stabilized, new achievements have been made in high-quality development, people's basic living needs have been ensured through more effective efforts, and overall economic and social stability has been maintained. Overall, the economy's performance in 2022 can be generalized in the following aspects.
First, China's composite national strength has been further strengthened. In 2022, China's GDP exceeded 120 trillion yuan, standing at 121 trillion yuan. After consecutively surpassing 100 trillion yuan in 2020 and 110 trillion yuan in 2021, China's GDP in 2022 reached a record high of 120 trillion yuan, or $18 trillion in U.S. dollar terms, according to the annual average exchange rate. China maintained its position as the world's second-largest economy. China's per capita GDP in 2022 reached 85,698 yuan, up 3% in real terms, amounting to $12,741, according to the annual average exchange rate. China's per capita GDP has exceeded $12,000 for two years in a row. The constant increase in China's GDP in both aggregate and per capita terms means a further enhancement in China's composite national strength, social productivity, international influence and people's living standards, which means a more solid foundation, higher quality, and greater momentum for development. Moreover, it demonstrates the Chinese economy's strong resilience, vast potential and ample space, and the fact that the fundamentals sustaining China's sound economic growth, in the long run, remain unchanged. Surely, it also means that we should continue to work with greater effort. The country's long-range goal for 2035 is to increase per capita GDP to the level of moderately developed countries. At present, the per capita GDP is only $12,700. The GDP needs to more than double to reach this medium-term goal. Therefore, 120 trillion yuan of GDP is only a small step on our way forward.
Second, the economy has remained generally stable. Economic growth was faster than most major economies. Early in the second quarter, affected by some factors beyond expectations, China faced an economic downturn. The CPC Central Committee and the State Council promptly adopted a package of policies to stabilize the economy, making great efforts to support the economy to withstand pressures and to firm up. Just now, I have reported to you that last year China's GDP grew by 3%, which is a fast growth rate compared with major economies in the world. For instance, Germany has announced its projected annual economic growth rate of 1.9%. According to the IMF, the economic growth rate of the U.S. and Japan in 2022 will not exceed 2%. China's GDP growth of 3% is relatively rapid, considering China has suffered shocks of many factors beyond expectation. In addition, overall stability was maintained in employment. A total of 12.06 million new urban jobs were created over the year, surpassing the projected target of 11 million new jobs. At the end of December, the surveyed urban unemployment rate stood at 5.5%, down 0.2 percentage points from the previous month. The consumer price index registered a moderate rise of 2% over the year. As global food and energy prices rose drastically and imported inflationary pressures increased, the stable prices in China contrasted sharply with the high inflation in major economies such as the U.S. and European countries. The balance of payments has been improved. The total volume of trade surplus in goods rose by 35.4% over the previous year; China's foreign exchange reserves reached $3.1277 trillion at the end of year, ranking first in the world.
Third, a solid foundation has been laid for industrial development. The agricultural sector has seen an increase in output and successful harvests. Moreover, a bumper food harvest has been secured for the 19th year in a row. The grain output totaled 686.55 million metric tons and has been kept above 650 million metric tons for eight consecutive years, putting us in a stronger position to ensure the food supply of the Chinese people. Meantime, industry has fully played its role as a ballast stone. The total industrial value added reached 40.2 trillion yuan and the value added by the manufacturing sector stood at 33.5 trillion yuan, leading the world. Industry's contribution to economic growth reached 36%. Infrastructure has been increasingly improved. As of the end of 2022, China's rail network in operation has grown to 155,000 kilometers, including 42,000 km of high-speed railways, leading the world. The world's largest internet infrastructure with world-leading technologies has been built and the industrial internet has been widely integrated into 45 categories of the national economy.
Fourth, domestic demand continued to expand. Despite the shocks of several rounds of COVID-19 resurgences, the total annual retail sales of consumer goods were stable at around 44 trillion yuan, with online retail sales reaching 12 trillion yuan. China is still the second-largest consumer market and largest online retail sales market in the world, with distinctive advantages in its huge market. The total investment in fixed assets exceeded 57 trillion yuan, up 5.1% over the previous year, 0.2 percentage points higher than that of 2021, providing strong support for sustained economic growth.
Fifth, reform and innovation have been deepened. Reforms to streamline administration and delegate power, improve regulation, and upgrade services have been advanced. The business environment has been improved. Moreover, steady progress has been made in the comprehensive pilot reform for the market-based allocation of production factors. In addition, the development of the high-standard market system has been accelerated. All these have contributed to creating a more favorable condition for the development of market entities. By the end of 2022, the number of market entities registered nationwide reached 169 million, including 114 million self-employed businesses. The innovation-driven development strategy has been further implemented and new development momentums have been playing an increasingly prominent role in driving growth. In 2022, the total value added of the high-tech manufacturing enterprises above designated size grew by 7.4% over the previous year, 3.8 percentage points higher than that of the industrial enterprises above designated size as a whole. Meanwhile, online retail sales of physical goods accounted for 27.2% of total retail sales of consumer goods, with a year-on-year increase of 2.7 percentage points.
Sixth, solid steps have been taken to advance high-standard opening up. Confronted with increasing downward pressure on the world economy and a slowdown in global trade growth, we have advanced high-standard opening up at a faster pace and supported enterprises to maintain production, receive orders and expand the market, achieving rapid growth in foreign trade and foreign investment. The total value of trade in goods reached a record high. In 2022, the total value of trade in goods exceeded 40 trillion yuan, reaching 42.1 trillion yuan, up 7.7% over the previous year. Trade in services grew rapidly. From January to November, the total volume of service trade stood at 5.4 trillion yuan, up 15.6% year on year. Inbound foreign investment grew in a trend-bucking manner. Bright economic development prospects and an increasingly optimized business environment made China a fertile ground for global investment and entrepreneurial pursuits. From January to November, China's utilized foreign investment amounted to 1.1561 trillion yuan, with a year-on-year increase of 9.9% calculated on a comparable basis, surpassing the whole year's total value of utilized foreign investment in 2021, hitting a record high.
Seventh, strong and effective measures have been taken to ensure people's livelihoods. We have remained committed to ensuring and improving people's livelihoods through development, using every possible means to boost personal incomes, consistently increasing investment in improving people's living standards, and taking practical measures to meet people's basic living needs. Personal incomes have grown steadily. In 2022, per capita disposable income of residents increased by 2.9% in real terms, which stayed basically in step with economic growth. The government provided stronger support to ensure personal incomes, with a year-on-year nominal increase of 5.5% in per capita net transfer income, higher than the growth rate of total personal incomes. Investment in improving people's livelihoods was increased and social sector investment in 2022 went up by 10.9% year on year, among which investment in health and social work was up by 26.1%, an increase of 6.6 percentage points over the previous year.
People can't know how difficult things can be until they have experienced them. Under the complicated circumstances of profound changes and a pandemic both unseen in a century and faced with shock caused by many unexpected factors, it is only by overcoming enormous difficulties that China has been able to make such achievements. We owe our achievements last year to the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the sound guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and the concerted efforts of the Party and Chinese people of all ethnic groups. These achievements speak volumes about the marked advantages of the system of socialism with Chinese characteristics and the strong resilience and vitality of the Chinese economy.
While fully recognizing our achievements, we also need to acknowledge that the international situation is undergoing complex changes, the global growth momentum is weakening, global trade faces grim challenges, and the world economy may suffer from stagflation. Domestically, the foundation for economic recovery is still not solid and enterprises still face many difficulties in their production and operations. Our capacity for scientific and technological innovation still needs to be further developed. Moreover, people still face many difficulties in seeking jobs. More intensive efforts are required to promote overall improvement in the economy.
Thank you.
_ueditor_page_break_tag_Kyodo News:
What's your forecast for economic goals and prospects in 2023? China has put an end to the dynamic zero-COVID approach, opened up its economy, and started to resume work and production. What progress has been made?
Kang Yi:
Thank you for your questions. This year will kick off our efforts to put all the guiding principles from the 20th CPC National Congress into action and it is also a crucial year for continuing to implement the 14th Five-Year Plan. The external environment is complicated and challenging, the global economy faces rising risks of stagflation and the foundation for economic recovery in China still needs to be consolidated. However, the Chinese economy's strong resilience, ample potential and strong vitality and the fundamentals sustaining China's sound economic growth, in the long run, remain unchanged. Moreover, the country's resources and production factors can provide enough support. With China's COVID-19 response moving into a new phase and policies continuing to be implemented fully and meticulously, work and life are expected to return to normal at a faster pace and the internal drivers of China's economy will gather greater momentum. In 2023, China's economy will see overall improvement. According to our analysis of the economy in 2023, there are some advantageous conditions, which are as follows:
First, China has a solid material foundation that has been built up over the years. China possesses all the industrial categories listed by the U.N. and features the best industrial supporting conditions. It has a strong capacity for industrial organization and resilient industrial chains. Therefore, China plays a crucial role in the global industrial division system and the global supply chain system. Infrastructure in China is well developed. In response to the fluctuations in the global supply system, we have enhanced our capacity to ensure security in key areas, including food, energy, and industrial and supply chains, creating favorable conditions for dealing with external risks and challenges.
Second, China enjoys the distinctive advantages of a super-sized domestic market. There are more than 1.4 billion people in China. New industrialization and urbanization continue to advance. China has a super-sized domestic market with the greatest potential in the world, serving as a powerful engine for promoting economic recovery.
Third, new growth drivers have played a stronger role in supporting the economy. We have further implemented the innovation-driven development strategy, worked hard to reinforce China's strategic science and technology capabilities, and taken effective measures to advance the rapid development of new industries. All these will provide new driving forces for economic growth.
Fourth, the dividends of efforts to deepen reform and opening-up continue to be unleashed. We uphold and further improve the basic socialist economic system and work unswervingly to both consolidate and develop the public sector and to encourage, support and guide the development of the non-public sector. We have strived to accelerate the development of a unified domestic market, deepened reforms to streamline administration, delegate power, improve regulation and strengthen services, and fostered an internationalized and law-based business environment, and created a more level playing field for various market entities.
Fifth, China has rich experience in macro regulation. In particular, current prices are generally stable and under control, leaving ample space for us to reserve and utilize policy tools for macro regulation in many ways.
In 2023, China's economy will certainly see an overall improvement. I believe you have seen the current situation of epidemic response and resumption of work and production. Taking Beijing as an example, traffic congestion has returned. And the number of domestic flights surpassed 80% of the level in 2019. People have returned to normal life. All these factors will create better conditions for economic growth in 2023.
Thank you.
_ueditor_page_break_tag_Reuters:
According to the statistics, in 2022, the total retail sales of consumer goods dropped by 0.2% over the previous year. In December, it went down 1.8% year on year. For this year, what effective measures will be taken to boost consumption, especially consumer spending? Moreover, what were the respective contributions of the three key demands for economic growth? Thank you.
Kang Yi:
Thank you for your questions. Consumption is a topic concerning everyone. Expanding domestic demand remains one of our top priorities this year.
Last year, the entire consumer market was hit hard by the epidemic. Especially due to the restrictions on cluster and in-person consumption, the overall consumer market was greatly impacted. In addition, people have become less willing to consume. The problems of being afraid and inconvenient to consume have become prominent. Total retail sales of consumer goods decreased by 0.2% last year, and the consumer market was significantly affected by the short-term disruption of the epidemic. Under such circumstances, we immediately launched a set of policies to boost consumption and basically stabilized the domestic consumption market with some new changes emerging. For example, overall sales margin improved in December. Total retail sales of consumer goods dropped by 1.8% in December. Compared to the decrease of 5.9% in November, as we reported, it narrowed by 4.1 percentage points. Some new types of consumption have developed rapidly. Online retail sales have made up an increasing share. Specifically, online retail sales of physical goods accounted for 27.2% of the total retail sales of consumer goods in 2022, 2.7 percentage points higher than the previous year. People tend to have an increased demand for higher-quality goods or services. All of the above are the characteristics of our country's consumption over the past year.
We have full confidence in China's consumer market in 2023. As China's epidemic response enters a new phase, production and life have gradually returned to normal, and consumer spending on brick-and-mortar businesses will gradually pick up. The consumer market is expected to recover in a steady manner. Here are some favorable conditions.
First, there is huge spending potential among Chinese consumers. There is a huge consumer demand with a population of more than 1.4 billion. At the same time, the general trend of the consumption structure upgrading has remained unchanged. Second, offline and service spending is gradually returning to normal. As production and life accelerate the pace of recovery, restrictions on consumption scenarios will be greatly reduced, creating favorable conditions for the recovery of service consumption and in-person consumption. Third, new consumer hotspots are emerging. New consumption models such as "internet plus" and "digital plus" have developed rapidly. Consumers tend to spend more on a green lifestyle, fitness, health care, and cultural products and services. Fourth, a stable job market and rising household income will also promote consumer spending. I mentioned that China's overall economy would definitely improve in 2023 when we looked at the outlook of China's economy in the next year. Economic recovery will improve employment and people's income and greatly boost consumers' capacity and willingness to spend.
At the end of last year, the National Development and Reform Commission issued a mid- and long-term plan to boost spending and domestic demand and made a series of arrangements for expanding the domestic market, promoting consumption, expanding employment, raising income, improving income distribution, perfecting income distribution pattern, facilitating consumption, and combining expanding domestic demand with deepening supply-side structural reforms. The implementation of these policies will continuously enhance people's spending power and promote the recovery, improvement, and scale of the consumer market in a steady manner.
Regarding the contributions made by the three key demands for economic growth, final consumption expenditure, capital formation, and net exports of goods and services drove economic growth by 1 percentage point, 1.5 percentage points, and 0.5 percentage points, respectively; and they were responsible for 32.8%, 50.1%, and 17.1% of economic growth, respectively.
Thank you.
_ueditor_page_break_tag_21st Century Business Herald:
I would like to ask, how do you view China's performance in achieving its 2022 employment goals? With the number of college graduates expected to hit a new record high in 2023, how will you better achieve the goal of stable employment? Thank you.
Kang Yi:
Employment has always been a topic concerning everyone. In 2022, due to the resurgence of the pandemic, small and medium-sized enterprises have been faced with increasing operating difficulties. It has also become difficult for key groups to find jobs, especially among the youth, where there are rising unemployment rates, which has brought challenges to realizing stable employment. Employment matters most in people's lives. The CPC Central Committee and the State Council have attached great importance to this issue and introduced a series of effective measures to stabilize employment. All localities and government departments have adhered to the principle of giving priority to employment, intensified the effect generated by the policy of stabilizing and expanding employment, taken measures to ensure employment for key groups, made every effort to stabilize employment, and safeguarded the bottom line of preventing large-scale unemployment. It has demonstrated the following characteristics.
First, the employment situation is generally stable. China created 12.06 million new urban jobs, exceeding its target of 11 million set at the start of the year. Due to the spread of the pandemic, the surveyed urban unemployment rate rose temporarily in particular months, reaching 6.1% at its peak. However, for the year overall, the unemployment rate remained basically stable. Notably, the employment situation has improved recently as the package of policies to stabilize the economy, and subsequent policies, have taken effect. The surveyed urban unemployment rate was 5.5% in December, dropping by 0.2 percentage points from November.
Second, effective measures have been taken to ensure the employment of key groups. A series of policies targeted toward helping enterprises create jobs and keep their employees have been adopted, which are helpful in facilitating college graduates and migrant workers to find jobs. In December, the surveyed urban jobless rate for the people holding junior college degrees or above between the ages of 20 and 24 was 21.1%, falling by 0.2 percentage points from November, the fifth consecutive month that the rate has decreased. The drop in urban joblessness for those between the ages of 16 and 24 was even more significant. Meanwhile, the surveyed unemployment rate for rural migrant workers was 5.4%, a drop of 0.6 percentage points from the previous month. The number of migrant workers reached 295.62 million in 2022, an increase of 3.11 million from 2021, surpassing 2019's pre-COVID levels. Moreover, over 32 million laborers who have been lifted out of poverty found employment, and rural and urban people facing difficulties also found jobs.
Generally speaking, the overall employment situation remained stable in 2022. The surveyed urban jobless rate increased slightly compared with 2021 levels, which was due to multiple unexpected factors at home and abroad. Going forward, the pressure on the job market remains, with more than 11.5 million college students expected to graduate this year and ongoing prominent structural problems. However, the overall employment situation is expected to improve in 2023 as the economy recovers, which will lead to expanded demand for employment and more jobs becoming available. First, thanks to optimized COVID-19 containment measures, people's lives are getting back to normal, and enterprises will gradually resume work and production, promoting employment demand. Second, service sectors, ranging from accommodation and catering to tourism, will recover as public transport, logistics, and travel rebound. Service sectors have a large capacity for employment, so more job opportunities will be created in the rebound and development of these sectors. Third, governments and departments at all levels will continue to enhance pro-employment policies, implementing measures to ease the burden of enterprises, keep their employees, and create more jobs. Such stepped-up efforts will provide employment support for key groups, including college graduates, and ensure employment stability. Fourth, the rapid growth of the new drivers will continue to create more new jobs, which will serve as an important driver to expand employment and ensure high-quality employment. Thank you.
_ueditor_page_break_tag_Swiss Radio:
Looking back to consumption, will there be further measures taken to enhance consumption to turn it around?
Kang Yi:
Consumption has become a concern for everyone. I have talked about this just now, so I'd like to invite Mr. Fu to give you more information.
Fu Linghui:
Consumption has been of great concern for everyone. Given the complicated and grim situation, governments and departments at all levels adopted a series of policies to promote consumption last year. In 2023, China released medium- and long-term policies to further expand domestic demand. Then, governments and departments at all levels are expected to play a bigger role in spurring consumption in a bid to expand domestic demand and promote economic recovery. As the pandemic containment has entered a new phase, the entire environment is more favorable for consumption, and people with increased spending power are more willing to spend. Recovery of consumption is expected to see good momentum this year, which will help China's economy to deliver a better performance. Thank you.
Yicai:
What do you think of fixed asset investment in 2022? The growth rate of investment has been declining despite the country's policies and measures to ensure growth and investment stability. What's behind this decline? What do you think of these investments going forward? Thank you.
Kang Yi:
Thank you. Fixed asset investment played an important role in stabilizing the economy in 2022, with capital formation accounting for 50.1% of the country's GDP growth. In 2022, fixed asset investment witnessed steady growth, up 0.2 percentage points from the previous year. All regions and all government departments made great efforts to ensure the construction of the key projects. Stepped-up endeavors have been made to shore up weak links and accelerate the issuance and use of local government special bonds. Policy-based and developmental financial instruments have been made good use of. In this way, fixed asset investment has maintained stable growth, with its structure being improved. Investment has played a key role in keeping growth stable and promoting structural adjustment.
Investment continued to expand, reaching 57.2 trillion yuan. Investment in the manufacturing sector grew rapidly, with a year-on-year growth of 9.1% in 2022, 4 percentage points faster than that of the national investment. The investment in manufacturing technology transformation increased by 8.4%, accounting for 40.6% of the total investment in the manufacturing sector, with its share surpassing more than 40%. Investment in infrastructure continued to accelerate, with investment in infrastructure growing by 9.4% year on year. The share of investment increase in water conservancy management was 13.6%, public facilities management was 10.1%, and information transmission was 9.3%. Investment in high-tech industries also witnessed rapid growth, up 18.9% from the previous year. Such growth is 13.8 percentage points faster than that of the national investment. The growth rate for high-tech manufacturing was 22.2%, and the rate for high-tech services was 12.1%. Moreover, investment in areas that are important to people's lives witnessed rapid increases, up 10.9% year on year, with the investment in health and social work increasing by 26.1%.
Generally, fixed investment remains stable but has new features. Driven by the demand side in the short term but by the supply side in the medium and long term, fixed investment requires the synergy of both supply and demand. This year, fixed investment is expected to continue to expand, considering the following aspects.
First, the investment potential of building a modern socialist country in all respects is huge. As the largest developing country in the world, China still faces a huge gap with developed countries in development levels on a per capita basis. China's per capita GDP is less than one-fifth of that of the U.S. and one-third of that of Japan. China's per capita infrastructure capital stock is only 20% to 30% of that of developed countries, and the space for development is huge.
Second, making up for disadvantages and strengthening weaknesses provides broad investment space. The problem of China's imbalanced and inadequate development is still prominent. The development gaps between urban and rural areas and between regions are relatively big and some rural areas in central and western China are lacking in infrastructure. Shoring up weak links implies broad investment space. Imbalances also exist in urban areas, and many weak points need to be strengthened.
Third, the momentum of investment in innovative development is strong. In recent years, the high-tech manufacturing industry, represented by electronic medicine and the high-tech service industry, represented by e-commerce, have maintained sound growth. These industries still have great potential in the future.
Fourth, infrastructure investment has been strengthened. The transformation and upgrading of traditional technological facilities, including transportation, energy, and water conservancy and the accelerated construction of new infrastructure such as 5G, extra-high voltage, intercity freeways and big data centers will drive effective investment. In terms of leading indicators, the total planned investment of projects starting construction in 2022 grew 20.2% year on year, with a growth rate of over 20% for four straight months. In December, the number of newly registered fixed assets investment projects was 38,000, up 7.5% from November. Considering these indicators, investment in 2023 has a solid foundation.
Generally speaking, China's investment has development potential, space and momentum, and is expected to sustain growth. Thank you.
_ueditor_page_break_tag_Financial Times:
Can you provide information on China's death rate in December 2022 and how it compares with December 2021? Thank you.
Kang Yi:
Thank you for your question about population, which is of great concern to many. I will introduce it from the perspective of demographic statistics. China conducts a population census every 10 years, or at the end of each decade. The latest census, also the seventh, was conducted in 2020. In non-census years, demographic statistics use survey sampling methods. At midnight on Nov. 1 each year, survey sampling is conducted in order to identify demographic changes. Therefore, the total population, births and deaths for the whole year are calculated. Thank you.
CNBC:
Last year saw a decline in real estate and exports. In terms of statistics, is there any new growth driving force for sustainable economic development to offset the factors leading to the decline? Thank you.
Kang Yi:
Thank you for your question about real estate and exports. First, I will brief you on the real estate situation in 2022. With a long industrial chain and affecting many aspects, the real estate industry greatly influences the national economy. According to our calculations, real estate and its relevant industries account for 13% or 14% of total GDP. In 2022, the value added of the real estate industry decreased by 5.1%, affecting many indexes. Due to the impact of the real estate industry, the 5.1% growth rate of fixed investment is not very fast. The 10% reduction in real estate investing led to a decline of 2.5 percentage points in fixed assets investment. Affected by the real estate sector, private investment increased by 0.9%. Private investment accounts for about 80% of real estate investment. Therefore, the decline of 10% in the latter has a big downward influence on the former. Manufacturing investment in private investment grew by double digits. Private investment has a large proportion of real estate investment, which has had a great downward impact on the former. Fluctuations in the real estate market are normal.
According to the latest situation, the country released a series of relevant policies to construct a new real estate system, as we have noticed. In December, the decline in all indexes in the real estate industry slowed down, with new factors coming into being. The decline in real estate investment in December was 7.7 percentage points smaller than that of November. Declines in the sold floor space of commercial buildings, sales volume, capital in place, and the floor space of houses beginning construction narrowed to different degrees. Therefore, we initially estimated that the impact of the real estate industry on the economy in 2023 would not be greater than that in 2022. Real estate remains a pillar industry, and conditions are favorable for the steady recovery of the real estate market. With urbanization still in development, China saw an increase of half a percentage point in its urbanization rate to 65.22% last year, still lower than 80% of developed countries. The newly added urban population was huge last year, which implies future development space. Policy adjustment in supply and demand aims to emphasize that housing is for living in, not for speculation, and reduce the financial function of real estate. Besides, guarantee and supply are provided in multiple channels from various parties, which will help establish a new healthy real estate market.
Policies concerning the demand side to support justified and improved housing needs will effectively support the real estate industry. The demand for improved living conditions is substantial. As the pillar industry for developing and developed countries, the real estate industry has a tremendous influence on the economy. Thank you.
_ueditor_page_break_tag_Economic Daily:
China will conduct its fifth national economic census in 2023. How is the work going? What improvements will be made to the upcoming national economic census compared with the previous one? Thank you.
Kang Yi:
Thank you for your questions and for allowing us to share more information about the fifth national economic census with the public. First, I will introduce the progress we have made in conducting the upcoming national economic census. The State Council issued a notice on carrying out the fifth national economic census on Nov. 17 last year to jump-start the work. The fifth national economic census is a major survey of national conditions and national strength carried out in the critical period of the beginning of building a modern socialist country in all aspects after the success of the 20th CPC National Congress. It's fair to say that this is also the first major survey on national conditions and national strength in the journey towards building a modern socialist country in all aspects, following the achievement of building a moderately prosperous society in all aspects. The NBS has thoroughly implemented major decisions and arrangements on statistical work deployed by the CPC Central Committee and the State Council, regarding the fifth national economic census as a major statistical task, and making solid progress in the planning and coordination of the census.
First, we have carefully planned the general idea of the census and coordinately arranged the input-output survey. The NBS regards carrying out the economic census and input-output surveys in a coordinated manner as a major statistical task, as part of the Plan for Modernizing Statistical System during the 14th Five-year Plan period. In the second half of 2021, we launched special pilot projects in six regions, including Shanxi province, to evaluate the feasibility and necessity of coordinating the two surveys. We have concentrated on the service of the new development stage, promoted high-quality development, closely focused on the task of modernizing statistical system, and formulated the general idea of the fifth national economic census on the basis of extensively soliciting opinions from all sectors and in-depth discussions.
Second, we have completed special pilot projects and made solid progress in making plans for the census. From June to September 2022, the NBS carried out special pilot projects in 14 provinces, autonomous regions, and municipalities, including Beijing, Tianjin, and Hebei, focusing on solving key and tricky problems and testing new content, methods and technologies for the census. Based on the results of the special pilot projects, we have formed the draft of the plan for the fifth national economic census. Currently, we are widely soliciting opinions about the draft plan from within statistical systems and relevant departments.
Third, we have strengthened coordination among departments to promote the implementation of arrangements for the census. As a massive social system project, the economic census requires the close cooperation of all sectors of the whole society. Now, all regions across the country have started implementing census work in their localities.
Your second question is about the differences between the fifth national economic census and the previous one. First, the upcoming census marks our first time conducting input-output surveys in a coordinated manner. As an objective requirement to promote high-quality development, census and survey work is an important measure in advancing the modernization of statistical system and the national economic accounting reform, as well as in consolidating the quality of statistical survey data. It is not only convenient to coordinate survey tasks, integrate survey contents, optimize survey items, and reduce the burden of grassroots work, but also conducive to a more comprehensive and systematic collection of grassroots data, the coordination of statistical survey data, and better verification of relevant data, ultimately achieving a better connection between economic aggregate and structural data.
Second, we will further innovate the means and methods used for conducting the census and survey. This national economic census will widely use administrative records of departments to promote the application of electronic licenses and certificates during the process. We will also adopt new ways to carry out the census, combining online filling with handheld electronic terminals and on-site data collection. We will also encourage census respondents to submit census data via the internet.
Third, we will launch inspections on the census in due time. We will firmly hold the lifeline of census data quality, strictly implement the census plan, standardize the work process of the census, strengthen the inspection and verification of data quality throughout the whole process, and effectively prevent and punish behaviors of statistical fraud and fake statistics. We will include the census situation in the content of statistical inspections at an appropriate time.
For the next year, in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, the NBS will steadily advance the establishment of census institutions, the construction of comprehensive pilot projects, the inventory work of various units, and the preparation work for census registration, to lay the foundation for the smooth implementation of the fifth national economic census and successfully complete the tasks of this year's census. The census will be a "comprehensive physical examination" of the national economy. With this, I would like to call for more support, understanding, participation and cooperation from every respondent engaged in this census. We also hope that our media friends will actively promote, support and supervise the census work.
Shou Xiaoli:
Due to time limitations, we can only answer two more questions.
_ueditor_page_break_tag_Bloomberg News:
My first question is about the unemployment rate. The unemployment rate usually rises in December, based on the last five or seven years. But this year, it fell. How do you explain that change in the historical pattern of unemployment, especially considering that in December, most of China seemed to have COVID-19 and economic activity was very, very limited? My second question is related to the question from the Financial Times. Will you be releasing monthly death data in the coming months, considering how much interest there is in how many people have died and how fast that is increasing? Thank you.
Kang Yi:
Thank you for your questions. Everyone pays close attention to the issue of employment and unemployment, and you have also been very careful to analyze China's urban survey unemployment rate data released every December for many consecutive years. In December 2022, the unemployment rate in China's urban survey fell by 0.2%, mainly due to the decline in the labor participation rate. In December, the labor participation rate fell by 1.1 percentage points, because migrant workers returned home. Moreover, some were recuperating at home after COVID-19 infections, and their willingness to participate in work was low, which was the main reason for the decline in the labor participation rate.
As for the second question, on Jan. 14, the State Council's Joint Prevention and Control Mechanism held a press conference on the current situation. Since the outbreak of the pandemic, China has shared its data on the pandemic, including information on infections and other aspects, with the world, its people and relevant institutions at the earliest opportunity. Since the pandemic prevention and control entered a new stage, relevant data will be released according to the relevant provisions of the Law on the Prevention and Treatment of Infectious Diseases and according to the rules that manage Class B infectious disease, as COVID-19 management was downgraded from Class A to Class B.
Thank you.
_ueditor_page_break_tag_Tianmu News:
As you mentioned just now, in the context of high global inflation, we can see that the current price data in China is still relatively stable and moderate. What is the reason for this? What is your anticipation for the price trend in 2023? Thank you.
Kang Yi:
The stable operation of prices is not only conducive to the stable performance of the economy, but also conducive to ensuring people's livelihoods. China's prices remained generally stable last year, with the annual CPI rising by 2%, lower than the expected target of 3%. There were many reasons for this.
First, China did not issue excess currency, and prices still reflect the relationship between supply and demand. Let's compare China's situation with that of other countries and regions. The US has continuously raised interest rates to curb inflation, and its CPI rose 6.5% in December. Europe's CPI rose at the sharp level, still more than 10%. Japan's CPI has also been rising recently. During the past three years of pandemic prevention and control, China has not flooded its economy with liquidity. This is the first reason.
Second, the effects of ensuring supply and stabilizing prices have become apparent. Geopolitical conflicts and rising energy prices are significant factors that contribute to imported inflation. We first ensured the energy supply, such as the coal supply, which reached a total output of 4.5 billion tonnes in 2022. The stable supply of coal ensured the power supply. Also, the grain price. China's grain output has been stable at more than 1.3 trillion jin (650 million tonnes) every year for eight consecutive years, achieving "19 consecutive-year harvests." A rise in food prices would drive up the prices of many commodities. According to the requirements of General Secretary Xi Jinping, we must secure our own food supply for the Chinese people. With a population of more than 1.4 billion, if our food supply were insufficient, we would have to purchase grains on the international market, which would drive international food prices even higher. We have provided a solid foundation to stabilize the supply and prices of grains, energy and other major commodities.
Third, the supply of industrial goods and services is sufficient. As I said just now, it reflects the relationship between supply and demand. China's complete industrial system and adequate supply of goods and services contribute to the stability of consumer prices.
In 2023, there is no basis for a sharp rise in prices. We are confident that the CPI trend will remain stable in the new year. Thank you.
Shou Xiaoli:
Today was Mr. Kang's first time attending our press conference at the State Council Information Office. Thank you to all the speakers and thank you to all the reporters for your participation. That's all for today's press conference.
Translated and edited by Yang Xi, Liu Jianing, Xu Kailin, Liu Sitong, Wang Qian, Zhang Rui, Wang Yanfang, Qin Qi, Li Huiru, Gong Yingchun, Zhou Jing, Huang Shan, Daniel Xu, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Mr. Xuan Changneng, deputy governor of the People's Bank of China (PBC)
Ms. Ruan Jianhong, spokesperson of the PBC and director general of the Statistics and Analysis Department of the PBC
Mr. Zou Lan, director general of the Monetary Policy Department of the PBC
Mr. Ma Jianyang, an official of the Financial Market Department of the PBC
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Jan. 13, 2023
Shou Xiaoli:
Ladies and gentlemen, good afternoon. Welcome to the second press conference held by the State Council Information Office (SCIO) this afternoon. We have invited Mr. Xuan Changneng, deputy governor of the People's Bank of China (PBC), to brief you on China's financial statistics in 2022 and take your questions. Also joining us today are Ms. Ruan Jianhong, spokesperson of the PBC and director general of the Statistics and Analysis Department of the PBC; Mr. Zou Lan, director general of the Monetary Policy Department of the PBC; and Mr. Ma Jianyang, an official of the Financial Market Department of the PBC.
Now, I will give the floor to Mr. Xuan Changneng.
Xuan Changneng:
Friends from the media, good afternoon. In 2022, faced with unexpected factors at home and abroad, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, the PBC firmly acted on the decisions and deployments of the CPC Central Committee and the State Council and the requirements of the Financial Stability and Development Committee under the State Council, stepped up the implementation of prudent monetary policies, adopted the policy package and follow-up policies for keeping the economy stable, took solid measures to serve the real economy, and made resolute contributions to maintaining a stable macroeconomic performance. On Jan. 10, the PBC released the Financial Statistics Report (2022). The data shows that China's financial system operated smoothly in 2022, and the financial sector provided stronger and higher-quality support for the real economy.
First, liquidity in the banking system maintained reasonably ample, and the growth in total credit became more stable. In 2022, the PBC lowered the required reserve ratio (RRR) twice, providing the real economy with more than 1 trillion yuan in long-term liquidity; turned in surplus profits of over 1.13 trillion yuan; and used various methods such as re-lending and rediscounting, medium-term lending facilities, and open market operations to release liquidity, thus creating a favorable liquidity environment for keeping the macroeconomic performance stable. Broad money supply (M2) increased by 11.8% year on year, 2.8 percentage points higher than that at the end of the previous year. RMB loans grew by 21.31 trillion yuan, surpassing the amount recorded in 2021 by 1.36 trillion yuan. Aggregate financing in the economy increased by 9.6% – 32.01 trillion yuan – year on year, which was 668.9 billion yuan more than that in the previous year.
Second, credit support for key fields and weak links of the real economy was strengthened. The credit structure was continuously improved. In 2022, the PBC introduced a range of targeted structural monetary policy tools for groups in difficulty and key fields, helping to keep the macroeconomic performance stable. The outstanding balance of loans to the manufacturing industry increased by 36.7% year on year, 25.6 percentage points higher than the growth rate of loans overall. The outstanding balance of loans to small- and medium-sized scientific and technological enterprises increased by 24.3% year on year, 13.2 percentage points higher than the growth rate of loans overall. The outstanding balance of loans to specialized and sophisticated enterprises that produce new and unique products increased by 24% year on year, 12.9 percentage points higher than the growth rate of loans overall. The outstading balance of inclusive loans to micro and small businesses increased by 23.8% year on year, 12.7 percentage points higher than the growth rate of loans overall. A total of 56.52 million micro and small businesses received the inclusive loans, a year-on-year increase of 26.8%. At the same time, the PBC guided policy and development banks to free up 739.9 billion yuan through policy and developmental financial instruments, and made full use of 800 billion yuan in new credit quotas to mainly support infrastructure development. By the end of 2022, the outstanding balance of medium- and long-term loans to the infrastructure sector increased by 13% year-on-year, 1.9 percentage points higher than the growth rate of loans overall.
Third, overall financing costs of the real economy dropped significantly. While major European and American economies raised interest rates sharply and swiftly, China's loan prime rate (LPR) reforms continued to deliver benefits. The one-year and five-year LPRs were lowered by 15 and 35 basis points, respectively, helping to reduce overall financing costs of the real economy. In 2022, the weighted average interest rate on newly issued corporate loans was 4.17%, 34 basis points lower than the previous year. Meanwhile, the PBC established a market-based adjustment mechanism for deposit interest rates to keep the cost of bank liabilities stable. In 2022, the weighted average interest rate of new time deposits was 11 basis points lower than that of the previous year.
The year 2023 is the start of fully implementing the guiding principles of the 20th CPC National Congress. The PBC will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly act on the guiding principles of the 20th CPC National Congress and the Central Economic Work Conference, work unswervingly both to consolidate and develop the public sector and to encourage, support, and guide development of the non-public sector, stay committed to the general principle of pursuing progress while ensuring stability, make prudent monetary policy more targeted and effective, focus on expanding effective demand and deepening supply-side structural reform, and contribute to high-quality and moderate economic growth.
Thank you.
Shou Xiaoli:
Now we will open the floor for questions. Please identify the media outlet you represent before raising a question.
_ueditor_page_break_tag_Reuters:
The Central Economic Work Conference stressed that the prudent monetary policy should be targeted and effective this year, with reasonable and sufficient liquidity to be maintained. In this context, is there room to further cut interest rates and RRR? Will structural tools be used more? Thanks.
Xuan Changneng:
As mentioned in my opening remarks, the prudent monetary policy aims to ensure better coordination in expanding domestic demand and advancing supply-side structural reform. On the one hand, we will make efforts to support the expansion of domestic demand. Reasonable and ample liquidity will be maintained. Financial institutions will be guided to act in accordance with the market-oriented and law-based principle, and properly manage the scale and pace of granting credit. We will put forward measures in a timely manner so that they will produce effects early on. The prudent monetary policy will proactively coordinate with fiscal and social policies, providing greater support for enterprises to stabilize and expand employment and for key groups to start businesses and find jobs, and increasing the incomes of urban and rural residents in multiple channels. We will ensure strong support for the aggregate demand of society, but in a reasonable and appropriate way. A deluge of strong stimulus policies will be avoided. We will work to ensure the balance between stabilizing growth, employment and price. On the other hand, we will give better play to the guiding role of structural monetary policy instruments. We will continue to make better use of the carbon emission reduction facility and the central bank lending for sci-tech innovation and others. Support will be provided for accelerating the building of a modern industrial system. Preferential policies, such as the instrument supporting inclusive loans for micro and small businesses, will be better implemented. Strong support will be given to the construction of key infrastructure and major projects in areas such as energy, transportation and water conservancy. Financial services for rural revitalization will be enhanced. We will work to achieve a high level dynamic equilibrium between effective supply and demand.
Currently, as epidemic prevention and control measures have been optimized and economic circulation has returned to normal, the confidence of micro entities will be gradually restored and their vitality gradually unleashed. We will take more measures to boost market confidence and stimulate the vitality of micro entities. First, we will work to lower the overall financing costs for businesses, reduce costs for personal consumption, and alleviate the debt burden for micro entities to improve people's spending power and enterprises' investment capacity. Second, we will stay committed to unswervingly consolidating and developing the public sector and unswervingly encouraging, supporting and guiding the development of the non-public sector. We will guide financial institutions to strengthen and refine financial services, step up support for private micro and small enterprises in the manufacturing and service sectors, and further promote the instrument supporting debt financing of private enterprises. Third, we will encourage spending on housing, automobiles, and other big-ticket items, and strengthen comprehensive financial support for services consumption with a focus on key areas such as education, culture and sports. Fourth, we will maintain financing for the real estate sector in a steady and orderly manner. Guided by the principle that houses are for living in, not for speculation, we will adopt city-specific measures to implement a differentiated housing credit policy. We will make full use of policy instruments, including a special lending facility to ensure the delivery of pre-sold housing projects and loan programs to support pre-sold housing project delivery, to protect the legitimate rights and interests of homebuyers. We will carry out programs to improve the balance sheets of quality real estate enterprises and take effective measures to prevent and diffuse risks for quality leading real estate enterprises. We will improve financial policies to support rental properties and advance a smooth transition of the real estate sector to a new model of development. Thank you.
Zou Lan:
I would like to make a few more points for your reference. The structural monetary policy instruments that have been mentioned have attracted wide attention from all sectors of society. Over the past two years, the PBC has conscientiously implemented the decisions and plans of the CPC Central Committee and the State Council, giving full play to the role of the monetary policy in adjusting both the aggregate and structure. Structural monetary policy instruments have been frequently applied. Especially since last year, many monetary policy instruments have been introduced. Generally, structural monetary policy instruments focus on key sectors, adopt reasonable and moderate approaches, and build up ample room for maneuvering. As of the end of last year, the outstanding value of structural monetary policy instruments stood at about 6.4 trillion yuan. They have played an active role in guiding financial institutions to ensure appropriate credit supply, allocating more financial resources to key areas and weak links, keeping a steady growth in the aggregate monetary and credit supply, and stabilizing the economy's fundamentals.
China's structural monetary policy mainly focuses on key areas and weak links in the national economy, including inclusive finance, green development, and scientific and technological innovation. Specific structural monetary policy instruments are regularly released on the official website of the PBC. You can keep up to date on them. Recently, we have been working on introducing some other structural instruments. These instruments mainly provide support for ensuring stability in the real estate market, including loan programs to support pre-sold housing project delivery and rental properties. We will release more details after the introduction of these structural instruments.
_ueditor_page_break_tag_Shangyou News:
Statistics show that China's aggregate financing to the real economy (AFRE) in December rose slightly on a year-on-year basis. What factors influenced the AFRE at the end of the year? How do you evaluate the overall performance of the AFRE in 2022? Thank you.
Ruan Jianhong:
This reporter raised two questions. The first question is about the AFRE in December. The second one is about the AFRE in the whole year. First, I will answer the question about the AFRE in December.
In December 2022, the country's increment in the AFRE reached 1.31 trillion yuan, a year-on-year decrease of 1.05 trillion yuan. That was mainly due to a relatively large reduction in bond financing. On one hand, financing of government bonds stood at 280.9 billion yuan, a year-on-year decrease of 886.5 billion yuan. That was because government bonds were issued early this year. The financing of government bonds in the previous 11 months amounted to 6.84 trillion yuan, a year-on-year increase of about 1 trillion yuan. Financial support for the real economy was strengthened in advance. On the other hand, fluctuations in the bond market affected the financing of corporate bonds to some extent. The financing of corporate bonds saw a net decrease of 488.7 billion yuan in December, a year-on-year decrease of 705.4 billion yuan. Despite the slight increase of the AFRE this month, RMB loans issued by financial institutions to the real economy — an important constituent of the AFRE — increased by 1.44 trillion yuan, a year-on-year increase of 405.1 billion yuan. Credit support for the real economy continued to be enhanced.
Now let's take a look at the AFRE for the entire year. Overall, the AFRE in 2022 increased by 32.01 trillion yuan, 668.9 billion yuan more than 2021's increment. The financial system played a significant role in supporting the real economy. Let's look at the structural data.
First, financial institutions strengthened credit support for the real economy. In 2022, RMB loans issued by financial institutions to the real economy increased by 20.91 trillion yuan, 974.6 billion yuan more than 2021's increment.
Second, the net financing of government bonds kept growing steadily. In 2022, the net financing of government bonds stood at 7.12 trillion yuan, and the increment was 107.4 billion yuan more than that of the same period of the previous year.
Third, off-balance-sheet financing saw a markedly narrower decline. Please note that it was a markedly narrower decline in off-balance-sheet financing. In 2022, entrusted loans increased by 357.9 billion yuan, 527.5 billion yuan more than 2021's increment. Trust loans decreased by 600.3 billion yuan, 1.41 trillion yuan less than 2021's decrement. Undiscounted bankers' acceptances reduced by 341.1 billion yuan, 150.5 billion yuan less than 2021's decrement.
In addition, the financing of corporate bonds saw a less increase. In 2022, the net financing of corporate bonds reached 2.05 trillion yuan, and the increase was 1.24 trillion yuan less than the same period of the previous year. Equity financing was 1.18 trillion yuan, roughly in line with that of the previous year.
Thank you.
_ueditor_page_break_tag_Hong Kong Bauhinia Magazine:
How was credit growth in the real estate sector in 2022? In the recent meeting on credit work, it was proposed to improve the balance sheets of good-quality real estate developers. What new policies will be adopted to ensure the stable development of the real estate sector? Thank you.
Zou Lan:
Thank you for your questions. Positive circulation in the real estate sector is of great significance for the sound development of the economy. The Central Economic Work Conference has made clear that the steady development of the real estate market must be ensured; reasonable financing needs of the real estate sector should be met; effective measures should be taken to prevent and mitigate risks associated with leading real estate developers; different policies should be adopted in different cities as appropriate to their local conditions; people's justified housing need and the need to improve their housing situation should be supported; the principle that houses are for living in, not for speculation should be upheld; and the smooth transition of the real estate sector toward new development models should be advanced. In response to the adjustments in the real estate market, the PBC, together with relevant departments, has worked to improve both supply and demand in accordance with the arrangements of the CPC Central Committee and the State Council to promote stability in the real estate market. As relevant policies gradually produce effects, we notice that recently the financing environment in the real estate sector, especially for quality real estate developers, has been significantly improved. I would like to present two figures here. From September to November 2022, loans to real estate development increased by over 170 billion yuan, 200 billion yuan more than the increment of the same period of the previous year. In the fourth quarter of last year, bonds issued by real estate developers in China were worth over 120 billion yuan, a year-on-year increase of 22%. According to the specific arrangement made by the Central Economic Work Conference, the PBC and relevant departments recently proposed to improve the balance sheets of good-quality real estate developers. Earlier this year, the PBC and the China Banking and Insurance Regulatory Commission jointly held a symposium on credit work. That proposal was an important part of the symposium, which has also been released on the official website of the PBC. According to information publicly disclosed by developers, over the past decade, the balance sheets of the real estate sector in China have gone through rapid expansion. The assets of the top 50 real estate developers in China have grown by 10 times, with some growing by 23 times. Meanwhile, the liability structure of the real estate sector is highly diversified, among which financial liabilities only account for 31%, including 14% in development loans from banks, 9% in foreign and domestic bonds, and 8% in financing via non-standard credit assets. Others mainly consist of funding for projects in advance from upstream and downstream enterprises, making up 30%, the personal house payments collected in advance, accounting for 32%, and delayed tax payments and payments on land purchases, representing 7%.
To implement the arrangement made by the Central Economic Work Conference and prevent the spreading of risk from property developers with financial problems to good-quality ones, relevant departments have drafted an action plan to improve the balance sheets of good-quality real estate developers. Targeting quality property developers who focus on their core businesses and are characterized by compliant operation, good qualification, and of systematical importance, the action plan gives priority to advancing 21 tasks in four aspects, including activating assets, sustaining liabilities, replenishing equity, and improving expectations. By taking a holistic approach, the plan aims to improve the cash flows of high-quality developers and guide their balance sheets back to the safety zone. The tasks include both measures to ensure the implementation of the policies that have been issued and a series of new measures, such as setting up special re-lending for national asset management companies and loan programs supporting rental properties. There is no specific list of good-quality real estate developers in the plan, and financial institutions can make their own decisions.
Concerning the "three red lines" rules on real estate developers, the plan has specified that the rules targeting 30 pilot developers will be optimized. While the overall framework of the rules remains unchanged, some parameters will be improved.
That's all for my answers. Thank you.
_ueditor_page_break_tag_Nikkei:
From December 2022, the digital RMB was included in calculating the amount of currency in circulation (M0). What is the purpose of doing so? Is it related to its official issuance in the future?
Xuan Changneng:
Thank you for your questions. The digital RMB is a digital version of the legal tender issued by the PBC. Like the physical yuan, the digital yuan is part of the currency. From the perspective of statistics and management, the physical and digital yuan should be tallied, analyzed and managed together. In recent years, as pilot schemes for digital RMB have advanced, application scenes have expanded and transaction volume and stock have increased. Relevant management and statistical systems have been improved. Adding the digital RMB to the calculation of money in circulation (M0) can provide a more accurate result of the latter. By the end of 2022, the amount of digital RMB in circulation was 13.61 billion yuan. With digital RMB included, the year-on-year increase in M0 was 15.3%.
According to the requirement of steadily promoting the research and development of digital currency in the 14th Five-Year Plan, the PBC will advance research and development pilots of digital RMB in an orderly manner, continue to improve the top-level design and the construction of the ecosystem, and strengthen the innovation of products and applications. We will gradually establish a sound management framework and continue to build upon the pilot plan's success. Financial statistics will monitor the issuance of digital RMB in the future and release relevant data to the public on a timely basis.
Thank you.
_ueditor_page_break_tag_Tianmu News:
The Central Economic Work Conference mentioned working unswervingly both to consolidate and develop the public sector and to encourage, support and guide the development of the non-public sector. This has created policy support and public opinion base that encourage the private economy and private enterprises to expand and strengthen. What measures will the PBC take to bolster the development of the private sector? Thank you.
Ma Jianyang:
Thank you for your question, which is of much concern to many people. In recent years, the Chinese economy has faced downward pressure due to the repeated impact of the pandemic and the unstable international situation, while private companies have faced more difficulties. According to the decisions and arrangements of the CPC Central Committee and the State Council, the PBC has created structural monetary policies, improved credit support policies, expanded diversified financing channels and continued to optimize the financing environment for private micro and small enterprises. Mr. Xuan presented statistics about inclusive loans to micro and small businesses in detail, and I will provide two more pieces of data. Inclusive loans to micro and small businesses have grown by around 20% for four straight years. In November 2022, the weighted average interest rate of newly issued inclusive loans to micro and small businesses was at 4.9%, a relatively low level. Micro and small businesses' effective needs for inclusive loans and their payment capacity were affected by the pandemic, and financial support has provided important guarantees and backing for them. For example, the market-based extension reached 30%.
Going forward, earnestly implementing the arrangements of the Central Economic Work Conference and adhering to a problem-oriented approach, the PBC will focus on issues of concern to society and guide financial institutions to treat enterprises from all sectors on an equal footing. In doing so, we will create a better financial environment for the further development of the private economy and private enterprises. First, we will provide greater credit support for micro and small enterprises in the private sector. Mr. Zou explained the work to improve structural monetary policy tools, and we will continue to use these tools well with intensified efforts. Second, we will further increase the scale of debt financing by private enterprises. In November 2022, we improved and strengthened the work regarding private enterprises' debt financing, resulting in the total issuance of 16.9 billion yuan of debt by private enterprises in more than a month. Next, we will further optimize supportive mechanisms for private enterprises' debt financing and enlarge their scale of debt issuance. Third, financial services for private micro and small businesses will be further improved. Now many banks provide online services. Some of them are able to complete the transaction of loans of less than 1 million yuan in one minute, which will further improve the financing service for private companies. Fourth, we will continue to promote the healthy and regulated development of platform companies. Previously, progress was made in rectifying large platform companies' financial businesses and most problems were solved. Going forward, we will continue to urge platform companies to go through with the rectification work, and improve day-to-day supervision. We will also support platform companies in technological innovation for them to achieve fruitful results in driving development, creating jobs, and competing on the global stage. Thank you.
_ueditor_page_break_tag_Thecover.cn:
The Central Economic Work Conference proposed to ensure the stable development of the housing market; what measures will the PBC introduce? Some people believe that the housing market should be stabilized by cutting interest rates, especially mortgage rates. What is the PBC's view? Thank you.
Zou Lan:
I have already covered your first question in my previous answer. I'll focus on the second question about interest rates.
The policy of home loan rates will affect specific interest rates that are negotiated and confirmed between commercial banks and customers. Specific interest rates are directly related to monthly mortgage payments, so this is a very important policy. Last September, the PBC and the China Banking Regulatory Commission (CBRC) released a notice that clarified how governments of eligible cities could independently decide to temporarily relax the lower limit of interest rates for new first-home loans in the fourth quarter. After introducing this policy, some local governments actively made relevant adjustments, which led to a certain decrease in the interest rates of new home loans. According to the statistics we have, the national average interest rate for newly issued personal housing loans in December 2022 was 4.26%, down by 1.37 percentage points year on year, which is the lowest since the statistics began in 2008. The newly adjusted policy mainly aims to establish a dynamic mechanism for first-home mortgage rates. We have seen the policy show effect, and will, in accordance with the principle of "city-specific housing policies", allow cities to adjust the lower limit for the rate in phases based on changes in local home prices, so as to form a long-term mechanism to support a stable and healthy development of the housing market.
As for property prices, NBSC publishes year-on-year and month-on-month statistics of housing prices from 70 large and medium-sized cities on a monthly basis. Relevant local government departments have the statistics for the cities not included in these reports. After analyzing historical data for the 70 cities, it has been found that housing prices show clear periodic fluctuations. Three consecutive months of rise or decline could indicate a trend change in housing prices. It often takes quite a long time to form this trend change. According to the new policy, although local governments evaluate housing price changes in each quarter, it might take a longer cycle than the evaluation cycle to adjust the lower limit of the home loan rates when the trigger conditions are reached. That is to say, the home loan rate policy is dynamically adjusted according to housing price trends; at the same time, the policy also has strong stability. After the establishment of the dynamic mechanism, the new policy of first-home loan rates will be implemented through two-way, dynamic, and flexible adjustments under the city-specific housing policies. It will not only effectively support local governments that face greater difficulties in the housing market to make full use of the policy toolkit but also guide the governments of cities with rising housing prices to withdraw in a timely manner so as to promote the steady and healthy development of the local housing market.
Thank you.
_ueditor_page_break_tag_Yicai:
What have financial regulators done to promote the rectification of the platform economy in the past two years? What progress has been made so far? What is the policy direction for rectifying the platform economy, including financial technology regulation? Thank you.
Ma Jianyang:
Thank you for your questions. I have just made a brief introduction about this; let me add something more. The PBC, China Banking and Insurance Regulatory Commission and China Securities Regulatory Commission, under the leadership of the CPC Central Committee and the State Council, have made solid efforts to rectify prominent problems in Ant Group and 13 other large platform enterprises since November 2020, according to the deployments of the Office of Financial Stability and Development Committee under the State Council. The problems included unlicensed businesses, regulatory arbitrage, unregulated expansion and behaviors that infringe on consumers' rights and interests. For more than a year, regulatory authorities, and especially those 14 platform enterprises, have taken active steps, demonstrated their understanding and achieved some positive results. Currently, most of the problems have been rectified. Large platform enterprises' awareness of rule-based business operation, fair competition and consumer protection has increased significantly, and their financial services have continuously improved. Meanwhile, financial authorities have tackled both symptoms and root causes and accelerated the development of the regulatory system. They introduced a series of targeted systems and documents in the fields of third-party payments, personal credit, internet deposits, insurance, securities and funds. The framework of a normalized supervision system of financial services of platform enterprises has taken shape, which has laid a sound institutional foundation for ongoing normalized supervision.
Next, financial authorities will earnestly implement the principles of the 20th CPC National Congress and the Central Economic Work Conference, work unswervingly both to consolidate and develop the public sector and to encourage, support and guide the development of the non-public sector, place equal emphasis on development and regulations, and support the sound development of the platform economy. First, we will continue to speed up the rectification of a few unsettled problems of relative platform enterprises to complete the rectification work. Second, we will improve normalized supervision, regulatory systems and mechanisms. We will strengthen the regulatory capacity in science and technology, support platform enterprises to operate in accordance with rules and the law, and develop financial services in a steady and prudent fashion. We will show no tolerance for financial activities in violation of laws or regulations. Third, we will do research and formulate financial measures to promote the sound development of the platform economy. This will include supporting platform enterprises in improving their capacity for scientific and technological innovation, quality and service efficiency, thus consolidating and enhancing their international competitiveness. We will give full play to their abilities in spearheading development, creating job opportunities, and international competition. Thank you.
_ueditor_page_break_tag_CCTV:
What are the expectations and policies of the PBC in response to interest rate hikes by the U.S. Federal Reserve and its potential spillover effects? Additionally, given the grim situation in relation to foreign trade, will the RMB continue its trend of appreciation in the early part of the year? Thank you.
Yi Changneng:
Since 2022, major developed economies, including the U.S., the eurozone and the U.K., have significantly tightened their monetary policies by aggressively raising interest rates. This has tightened the global financial system and caused emerging market economies to experience pressure from cross-border capital outflows. The market has certain expectations of interest rate hikes by the U.S. Federal Reserve in 2023. China has a big economy that is hugely resilient. In response to the COVID-19 pandemic, China has implemented normal monetary policies, instead of resorting to a deluge of strong stimulus policies, to maintain reasonably ample liquidity and ensure stable financial support for the real economy. China's financial system has shown great initiative and stability. Moreover, expectations of the RMB exchange rate are stable. All these are conducive to buffering and dealing with external risks, especially spillovers from interest rate hikes by developed economies. Generally speaking, developed economies' adjustments to monetary policies have a limited impact on China and may have a greater impact on other small emerging market economies.
Next, the PBC will continue to adopt a comprehensive approach and react to developed economies' adjustments to monetary policies actively and prudently. We must make economic stability our top priority and focus on the domestic economic situation. We will ensure the proper intensity and pace of prudent monetary policies based on the domestic economic situation. In addition, we will increase the flexibility of the RMB exchange rate to enhance its function of adjusting the macroeconomy and international balance of payments. We will guide market entities to establish risk-neutral awareness, and strengthen unified, macroprudential management of cross-border capital flows. We will also strengthen expectation management and keep the RMB exchange rate generally stable at an adaptive, balanced level. In particular, we will guide enterprises to do a good job at hedging and establishing risk-neutral awareness.
Regarding the RMB exchange rate, the Chinese yuan has gradually appreciated against the U.S. dollar since mid-November 2022 as the economic stimulus policies started to take effect, and China's COVID-19 prevention and control measures have been optimized and financial measures to support the property sector have been introduced, as well as the market expected slower interest rate hikes from the Federal Reserve, and the dollar index retreated from its highs. The RMB's spot exchange rate against the U.S. dollar opened below 7.0 on Dec. 5.
The current and future trend of the RMB exchange rate could be affected by multiple factors, such as the domestic and international economic and financial situation, the country's balance of payments, market risk appetite and so on. It is inevitable that exchange rate forecasting in the short term is inaccurate. Overall, we have a solid foundation to maintain the basic stability of the RMB exchange rate. Recently, China's economic recovery has been on track with the nation constantly optimizing COVID-19 prevention measures. Moreover, China has basically maintained price stability in the face of high global inflation. The growth of China's trade surplus is likely to slow down, considering that the economic sentiment index of major economies has declined. The RMB exchange rate will remain basically stable under the influence of a variety of factors. Through years of financial reform and opening-up, China has greatly increased the depth and breadth of its foreign exchange market. The RMB exchange rate has become more flexible, market expectations have been kept stable, cross-border capital flows have been made orderly and the basic balance in international payments has been maintained. As a result, the RMB exchange rate will continue to remain basically stable at an adaptive and equilibrium level.
Thank you.
Shou Xiaoli:
Two more questions, please.
_ueditor_page_break_tag_Xinhua News Agency:
Inflationary pressures in some countries have drawn much attention in the market. The central bank warned against future inflation risks in its report. Does the central bank think there will be inflation in our country in 2023? How will the central bank respond to the risk? Thank you.
Zou Lan:
It was indeed mentioned in the monetary policy report of the third quarter of 2022. We have also noted that discussions from all walks of life have been quite heated since the report was released. Mr. Xuan Changneng, vice governor of the PBC, also mentioned it just now. Last year, many countries around the world endured the highest inflation in decades. In stark contrast, China has kept price levels basically stable. Our achievements did not come easily. If we look back over the past five or 10 years, we can see that China's consumer prices have sustained an average annual growth rate of around 2%, which fully proves the strengths of our socialist system and the effectiveness of macro regulation. This also benefited from the resolute implementation of the decisions and plans of the CPC Central Committee and the State Council and coordinated efforts to ensure supply and price stability in key areas such as energy and food. At the same time, we have followed a prudent monetary policy and refrained from adopting a deluge of strong stimulus policies to foster a sound monetary and financial environment for price stability.
In 2023, China's inflation is expected to remain moderate, but we should also pay attention to the potential for an increase. On the one hand, China's inflation is expected to remain stable due to abundant supply and recovering demand, and we did not issue excessive currency. Currently, China's economy is still on a path of recovery, and the industrial and supply chains are operating smoothly. However, inadequate effective demand is still a prominent problem, and the output gap is still negative. In the short term, inflationary pressure is generally under control. In the medium and long term, as one of the world's major producers, China will continue to maintain a general balance between supply and demand, pursue a prudent monetary policy, and have stable inflation expectations. All these will provide favorable conditions to keep prices basically stable. On the other hand, there is still uncertainty about price levels, so we must not lower our guard against inflation. We must keep a close eye on the possibility of further inflation. Domestically, for some time, M2 growth rate in China has remained high, and the possibility of a lag in the impact on prices cannot be ruled out. As China optimizes its COVID-19 prevention and control measures, people's ability to consume will gradually improve, and aggregate demand will also increase, which is likely to put upward pressure on inflation. Internationally, geopolitical conflicts could disrupt global energy supplies and inflation could remain high throughout advanced economies, so we need to be wary of imported inflationary pressure.
In the next stage, the PBC will adhere to the general principle of seeking progress while ensuring stability, pursue the strategy of expanding domestic demand, and deepen supply-side structural reform, while prioritizing efforts to stabilize growth, employment, and prices. The bank's prudent monetary policy will be targeted and effective, eying short-term and long-term effects at the same time, balancing between economic growth and stability of prices, and pursuing both internal and external equilibrium. Furthermore, the bank will strengthen coordination among policies to promote the effective improvement of the economy's quality and reasonable growth.
_ueditor_page_break_tag_ThePaper.cn:
At the end of December, M2 grew by 11.8% year on year, 2.8 percentage points higher than the same period in 2021. What is the reason for the high level of M2? What is your perspective on its future trend? Thank you.
Ruan Jianhong:
Thank you for your questions. According to published data, at the end of 2022, the M2 balance was 266.43 trillion yuan, a year-on-year increase of 11.8%. This rate is a 0.6 percentage point lower than the previous month (end of November 2022) and 2.8 percentage points higher than the same period of the previous year (end of 2021). The high growth rate of M2 is mainly due to the increased financial support of financial institutions for the real economy and the corresponding increase in derived currencies.
First, financial institutions significantly increased their bond investments. In 2022, bond investments by financial institutions increased by 6.92 trillion yuan, a year-on-year increase of 1.58 trillion yuan. Among these investments, government bond investments grew by 1.39 trillion yuan.
Second, various RMB loans rose steadily. In 2022, various RMB loans increased by 21.31 trillion yuan, a year-on-year increase of 1.36 trillion yuan.
Third, the equity and other investments of financial institutions increased significantly. In 2022, equity and other investments increased by 522.5 billion yuan, a year-on-year increase of 566.3 billion yuan.
At the same time, the central bank turned over profits of 1.13 trillion yuan, increasing the financial resources available to the government. After fiscal expenditures, the growth rate of M2 increased by around half a percentage point.
In 2023, the PBC will resolutely put into action the spirit of the 20th CPC National Congress and the Central Economic Work Conference, ensure its prudent monetary policy is targeted and powerful, and maintain credit support for the real economy. It is expected that the growth rate of M2 will remain stable and the reasonable ample liquidity will be maintained. Thank you.
Shou Xiaoli:
Thanks to all the speakers and friends from the media. Today's briefing is hereby concluded. Goodbye.
Translated and edited by Zhang Liying, Wang Qian, Xu Kailin, Wang Wei, Huang Shan, Liu Jianing, Liu Sitong, Yan Xiaoqing, Zhang Junmian, Yang Xi, Ma Yujia, Dong Qingpei, Li Huiru, Yan Bin, Daniel Xu, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Mr. Lian Weiliang, vice chairman of the National Development and Reform Commission (NDRC)
Mr. Zhang Jianhua, administrator of the National Energy Administration (NEA)
Mr. Zhang Zuqiang, deputy administrator of the China Meteorological Administration (CMA)
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Jan. 13, 2023
Shou Xiaoli:
Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Mr. Lian Weiliang, vice chairman of the National Development and Reform Commission (NDRC); Mr. Zhang Jianhua, administrator of the National Energy Administration (NEA); and Mr. Zhang Zuqiang, deputy administrator of the China Meteorological Administration (CMA), to brief you on ensuring energy supply and winter heating. They will also take your questions.
Now, I will give the floor to Mr. Lian Weiliang.
Lian Weiliang:
Ladies and gentlemen, friends from the media, good afternoon. I would like to thank our friends from the media and all the other sectors of society for your interest in and support for our work on ensuring energy supply. Today, Mr. Zhang Jianhua from the NEA, Mr. Zhang Zuqiang from the CMA, and I are here to brief you on ensuring energy supply and winter heating. Please first allow me to introduce the current situation.
Since last year, the global energy supply and demand situation has been grave and complicated, especially with supply shortages and drastic price fluctuations. As China's economy has been deeply integrated into the global economy, domestic energy supply was inevitably affected by changes in international energy supply and demand and price fluctuations. As a result, we faced mounting difficulties and pressure in ensuring domestic energy supply.
The Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core attaches great importance to ensuring energy supply. The Central Economic Work Conference stressed strengthening regulation of supply and transportation of coal, electricity, petroleum, and gas to ensure a warm and safe winter for the people. The State Council has made specific deployments many times, calling on efforts to guarantee a stable economic performance, stable energy supply, and stable prices of electricity, gas, and other energy products for residents so that they can have a warm winter. This has been referred to as the “three guarantees.” The NDRC, the NEA, and other departments under the inter-ministerial coordination mechanism for ensuring supply and transportation of coal, electricity, petroleum, and gas have thoroughly implemented the guiding principles of the 20th CPC National Congress and the requirements of the CPC Central Committee and the State Council, and achieved initial success in ensuring winter heating and energy supply. Overall, the supply of energy has been guaranteed, and prices are stable across the country.
First, significant progress has been achieved in increasing energy production and supply. With safety as the premise, we have worked to ensure stable production and sufficient supply of coal, keeping daily coal production above 12 million metric tons in the heating season. We have fully tapped the potential for increasing petroleum and gas production, raising natural gas production by more than 10 billion cubic meters throughout the year. We have continued to improve power supply capacity, increasing the installed capacity of various types of power generation by more than 200 million kilowatts.
Second, energy reserve capacity and the capacity of ensuring energy supply during peak periods have been significantly enhanced. We have continued to enhance the natural gas reserve capacity. China's gas reserve capacity have exceeded 32 billion cubic meters. We have stored as much gas as possible before the winter, with 20 billion cubic meters available at present. The coal reserve capacity has been greatly improved. Our government-deployable coal reserve stands at about 50 million metric tons, while coal storage in power plants remains at a high level of about 175 million metric tons.
Third, the supply and price stability of energy products for people's livelihood have been effectively guaranteed. We have prepared resources for energy supply in advance. We have signed medium and long-term contracts with all the suppliers of coal for power generation and heating, and with the suppliers of gas for people's livelihood. Contract performance and transportation capacity have continued to improve. We have maintained mid- and long-term contract prices of thermal coal within a reasonable range, strictly implemented government pricing for household use electricity, and ensured that households under the coverage of the pipeline network consume natural gas at gate-station prices. In this way, we have guaranteed the sufficient supply and price stability of products for people's livelihood.
Fourth, the energy demand for economic and social development has been met. During the current heating season, the average national daily dispatched power generation capacity is 23.62 billion kWh, and the maximum daily power generation capacity is 25.5 billion kWh. The overall power supply and demand of the whole society has been balanced. The average national daily gas consumption is 1.15 billion cubic meters, and the maximum daily gas consumption is 1.3 billion cubic meters. All these have provided a strong support for economic and social development.
Thanks to the joint efforts of all parties, we have effectively responded to previous cold waves during this winter and maintained a stable and orderly energy supply nationwide. This was due to the strong leadership of the CPC Central Committee, which have proactively planned the building of energy production, supply, storage, and marketing systems in recent years to continuously improve China's energy supply capacity. We have also benefited from the strengths of the country's system , which creates synergy between an efficient market and a well-functioning government, and enable resolute actions to ensure energy supply for people's livelihood. Lastly, this success can also be attributed to our efforts based on China's realities to accelerate green and low-carbon energy transition, while making full use of coal and coal-fired power to avoid energy supply shortages. There are still more than two months until the end of the heating season, and more cold waves will arrive during the Spring Festival. Ensuring energy supply will continue to be a weighty task, and we must persevere in our efforts to deliver a solid performance in all areas of work.
First, we will continue to make efforts to increase energy production and supply. We will guide local governments and enterprises to well organize coal production during the Spring Festival holiday to ensure a stable supply. We will enhance electricity generation and supply capacity and keep domestic oil and gas fields operating safely at full capacity.
Second, we will strive to improve our capability to guarantee energy supply during peak periods. We will improve the comprehensive emergency distribution mechanism, featuring a complementary combination of coal, natural gas, and electricity. We will increase the output of thermal power generating units, improve hydropower distribution, and promote nuclear power, wind power, and photovoltaic power generation. Emphasis will be laid on response planning for power generation during peak periods and guaranteeing gas and coal resources used for power generation during peak periods.
Third, we will ensure energy supply in key regions. We will closely monitor heating companies' stockpiles in key regions, ratchet up railway transportation capacities, and carry out cross-provincial power distribution in a timely manner so as to ensure a safe and stable energy supply during key periods, including the Spring Festival.
Fourth, we will better organize resource imports. We will strive to stabilize the supply of imported natural gas and coordinate the management of underground gas storage facilities and LNG storage tanks to make sure that the gas supply for people's livelihoods will not be affected by fluctuating imports. Furthermore, we will secure coal imports to effectively supplement domestic supplies.
Fifth, we will ensure people's basic energy needs are met. We will improve the electricity capacity management plan, enhance the emergency plan that prioritizes residential use of natural gas, and guide local governments to take joint actions with enterprises to activate the above-mentioned plans in an orderly manner. We will strengthen the monitoring of individual cases concerning heating and energy supply and quickly coordinate and handle problems to guarantee sufficient electricity and gas in order to meet people's living needs.
That's all for my introduction. Next, we would like to answer your questions. Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
Thank you for your introduction, Mr. Lian. Next, we'll move on to the question and answer session. Please identify the media outlet you represent before asking a question.
CCTV:
The world is facing tight energy supplies amid the current complex and grave international energy situation. Is a safe, stable, and steady energy supply guaranteed in China? Meanwhile, a new round of cold waves is about to hit the country as the Spring Festival approaches. What measures will be taken to guarantee a warm winter for the Chinese people? Thank you.
Lian Weiliang:
Thank you for your questions. Energy supply is of great concern to all of us. Since last year, facing a tight global energy supply and soaring prices, China has experienced increasing pressure to maintain its energy supply. Under the strong leadership of the CPC Central Committee and the State Council, China rolled out a series of effective response measures in an orderly manner. Clear progress has been made in stabilizing energy supplies and prices. As I introduced before, China's safe, stable, and steady energy supply is guaranteed, which can be demonstrated in five aspects: space for increasing production and supply, long-term agreements on resource imports, reserves of key energies, policies to stabilize prices, and mechanisms to ensure supplies in an emergency.
First, there is space for China to increase its energy production and supply. Coal is our basic energy source. In recent years, our advanced coal production capacity has remarkably increased through measures of constructing large units, restricting small ones, increasing quality units, and cutting backward ones. Our power supply capacity has also been steadily enhanced, with the country's installed power generation capacity reaching 2.6 billion kW. Increases have been seen in oil and gas reserves and production. The production capacity of crude oil has exceeded 200 million metric tons annually, and that of natural gas is more than 220 billion cubic meters.
Second, we have signed long-term agreements on resource imports. People are concerned as to whether China's energy supplies, especially in crude oil and natural gas, which partly depend on imports, will be affected by fluctuations in the international market. I would like to take this opportunity to specify that spot goods are subject to being affected but that long-term agreements are relatively stable. We have followed international norms and market rules and secured imported resources through long-term agreements. For example, most of China's imported natural gas is secured through long-term agreements, which can effectively control and fend off risks of supply shortages and drastic price fluctuations.
Third, we have sufficient key energy reserves. We have substantially increased investment in reserve capacity building over the years. China's natural gas reserve capacity has exceeded 32 billion cubic meters. Natural gas has been stored as much as possible before the heating season. At present, halfway through the heating season, there are still 20 billion cubic meters of gas storage available. Moreover, there are about 50 million metric tons of coal that can be distributed by the government. As for coal stockpiles at power plants, the number remains at 175 million metric tons, fueling 22 days of heating, and can guarantee additional power generation during peak periods.
Fourth, we have launched policies to stabilize prices. Stable energy prices are crucial to people's well-being and stable economic performance. The pricing mechanism of coal has been further improved, enabling thermal coal prices to remain within the appropriate range. Steady progress has been made in reforms, making the pricing of on-grid electricity from coal-fired power plants increasingly market-based. The transmission mechanism of coal and electricity prices has been gradually improved. Government prices are strictly enforced in the arenas of residential electricity and gas so as to keep prices stable.
Fifth, we have set up a mechanism to ensure emergency supply. We have coordinated and let different types of energy, such as coal, natural gas, electricity, and petroleum products supplement each other so as to ensure their supply. The capability of ensuring energy supplies during peak usage has been steadily improved. The contingency plans for demand-side load management have been further improved. We will not limit the use of electricity or gas except in extreme scenarios. During extreme conditions, we will only limit the use of electricity and gas and not completely cut their supply in order to meet the basic demands for civilian energy use.
You just mentioned forthcoming cold fronts and the holiday energy supply. A cold front would increase heating energy demands. And if it brings rain, snow, and freezing weather, the production and transportation of coal will be affected as well as the power transmission. According to previous experience, general energy demands around Spring Festival are relatively lower, so supply can be guaranteed and the heating demands prompted by lower temperatures will be met. Even under extreme circumstances, when encountering unexpected civilian energy demands, we can act according to contingency plans and limit other energy usage to ensure civilian use is unaffected. Our energy supply is secure, and people will be able to enjoy sufficient heating in winter and have a happy Chinese New Year.
We should take the new cold fronts seriously, maintain bottom-line thinking, and take active measures to respond to issues. The focus should be on ensuring production, transportation, peak-time operations, and quick responses to individual cases.
First, to ensure production, we should guide energy enterprises to make contingency plans in the event of interruptions or a drop in production that may be caused by rain and snow. This is with the aim of maintaining production safely while making sure production does not drop or does not drop significantly. Second, to ensure transportation, we should guide power and heating plants and ports in the north to do a better job in unloading frozen coal and smooth the arteries and key links of coal transportation. Third, to ensure peak-time operations, we should enhance coordination, increase supply at peak times, and make sure additional civilian energy demands in extreme, low temperatures can be met. Fourth, to ensure quick response to individual cases, we should improve monitoring and pre-warning systems so as to identify potential risks before they grow into serious problems. All such issues should be tackled through coordination and in a timely manner. Thank you.
_ueditor_page_break_tag_Cover News:
As of last year, global energy prices have continued to remain high and unstable, especially in Europe, where prices of electricity and gas surged dramatically. Given that the energy supply of our country highly depends on imports, how will we maintain the basic stability of energy prices? Thank you.
Lian Weiliang:
Thanks for your question. The stability of energy prices is relevant to people's livelihoods as well as the stable performance of the economy, and thus a public concern. We just said that the global energy demand and supply were complicated and not optimistic last year, with prices picking up sharply. Data shows that from January to November last year, energy prices, as part of the Consumer Price Index (CPI), went up 27% and 38% year on year in the United States and Eurozone, respectively, while natural gas prices increased 26.6% and 56.5% in the two regions and electricity prices 12.9% and 36.3%. In sharp contrast, China, also facing shockwaves from the global market and the test of extreme weather conditions, kept energy prices generally stable and within a reasonable range. This demonstrates the advantages of our system and the assorted measures for ensuring supply and stable prices. From January to November last year, the price of water, power, and fuel for civilian use, as part of CPI, only rose by approximately 3% in China, and the inflation in the price of gasoline and diesel was also lower than in Europe and the US. In particular, the prices of electricity and gas for civilian use were generally stable.
China produces, consumes, and imports large amounts of energy. It is not easy to maintain a stable energy supply and prices while facing a grim external environment, especially with regard to stabilizing prices. The achievements of the past year are really something. The key to achieving them was to seriously implement the decisions and plans of the CPC Central Committee and the State Council; continue to improve the system of energy production, supply, storage, and marketing; and see stabilizing energy supply and prices as a systematic project and promote it through various measures. These efforts can be summarized as follows.
First, we focused on increasing effective supply. The increase of supply is the prerequisite for stable prices. So, we unleashed our advanced production capacities and improved energy production capabilities. We supported enterprises to go into full-capacity production while ensuring safety so as to increase effective supply. We also reinforced transportation coordination and links between production, transportation, and demands.
Second, we focused on improving the pricing mechanism. A well-conceived pricing mechanism is the key to stabilizing prices. We innovated and improved a market-based pricing mechanism for coal and clarified the reasonable price range in the medium and long term. We deepened the reforms making the pricing of on-grid electricity from coal-fired power plants increasingly market-based and adjusted the price range of on-grid electricity from coal-fired power plants with rational means. We also insisted on ensuring people's livelihoods. Government pricing was strictly followed when it came to civilian electric power. Within the coverage of pipeline gas, civilian gas prices were fixed by combining ex-factory prices and pipeline transport prices.
Third, we focused on making good use of medium- and long-term contracts. Signing medium- and long-term contracts is an important way to mitigate price fluctuations. We have encouraged domestic enterprises to sign long-term import agreements early and lock in import resources in advance. We have comprehensively improved the contract signing and implementation rate of long-term agreements. It can be said that medium- and long-term energy contracts have become the ballast to ensure supply and price stability.
Fourth, we have focused on the key role of energy companies in ensuring energy supply. Various energy companies have overcome difficulties and worked hard to increase production and supply. The government has tried its best to help energy companies tackle their difficulties, control costs through medium- and long-term contracts, rationally ease costs through the implementation of price policies, and increase fiscal, tax, and financial support to effectively alleviate the temporary difficulties in operation for some companies. This has created good conditions for ensuring energy supply and price stability.
Thank you.
_ueditor_page_break_tag_Xinhua News Agency:
The new round of rainy and snowy weather this week will bring about a sharp drop in temperature. What is the overall situation of the current energy production and supply? Are we prepared for extreme weather? Thank you.
Zhang Jianhua:
Thank you for your questions. In accordance with the decisions and plans of the Party Central Committee and the State Council on ensuring energy supply and price stability, we have been working with relevant sides to make preparations, and going all out to do a good job to ensure that the supply of coal, electricity, oil, and gas can meet peak demand during winter.
In 2022, we kept on optimizing and adjusting the structure of the coal industry, actively expanded advanced coal production capacity, and phased out outdated production facilities. The elasticity of coal supply was significantly enhanced, and the annual average daily output remained at a reasonable level. Efforts were made to ensure the safe and stable supply of electricity. Over the year, coal-fired power generators with a total capacity of more than 30 million kilowatts were put into operation, and construction of generators with a total capacity of over 50 million kilowatts was started . The level of coal storage in the country's major power plants remained high. We fully promoted the increase of oil and gas reserves and production, which exceeded the phased goal set in a seven-year action plan for the oil and gas industry. Total crude oil production recovered to 200 million metric tons , and natural gas production exceeded 220 billion cubic meters, marking annual increases of more than 10 billion cubic meters for six consecutive years.
Since the beginning of the winter season, the energy supply has withstood the test of multiple rounds of cold waves. Since December last year, coal production has remained stable, and the electricity coal inventory has remained at about 175 million metric tons. The national electricity load has stabilized at about 1.1 billion kilowatts, with a maximum of 1.159 billion kilowatts, and power generation increased by 5.8% year-on-year. Since the beginning of this winter, the number of days when the daily supply of natural gas exceeded 1.2 billion cubic meters reached 38, and underground gas storage facilities operated at full daily capacity of above 170 million cubic meters to meet gas demand peaks for 20 consecutive days . At present, the consumption of coal, electricity, and natural gas across the country has dropped from the peak level, and the supply and demand situation has been generally stable and manageable. The energy supply in the current heating season has been guaranteed in terms of resource volume and regional balance. Governments at all levels and various energy companies have established emergency response mechanisms to ensure supplies. In order to further eliminate people's worries and smooth the channels for problem reporting and resolution, you can call the 12398 energy supervision hotline if the problem of heating services and supply by a specific energy company has not been resolved, or if the solution is not satisfactory after reporting. Thank you.
_ueditor_page_break_tag_N Videos at Southern Metropolis Daily:
Recently, media reported that residents in areas where coal has been replaced with natural gas struggled with limited purchases and supply shortage. How do you view this problem? What measures should be taken to ensure residents' gas supply? Thank you.
Lian Weiniang:
Thank you for your questions. The CPC Central Committee and the State Council have attached great importance to the problem and required us to establish a special mechanism to monitor and solve the problem in a timely manner. After monitoring the problem you mentioned, we immediately mandated local governments to take measures to solve it. This has exposed the failure of some local governments and enterprises in implementing measures to ensure energy supply and stabilize prices for people's livelihoods. We will draw lessons from it, further consolidate the responsibility of ensuring energy supply in localities, and faithfully implement measures to ensure energy supply and stabilize prices for people's livelihoods. Hereby, I would like to emphasize that natural gas resources in the heating season are sufficient. The medium- and long-term natural gas contracts we signed before the heating season have exceeded the expected demand of various regions. Since the heating season began, actual consumption has been lower than expected. Overall, the total amount of natural gas is guaranteed. Therefore, no local governments or enterprises should limit the purchase of gas for people's livelihoods. Once such problems are found, relevant parties will be held accountable. If restrictions are due to insufficient gas supply contracts, the central government will coordinate relevant departments to increase supply; if they are due to other reasons, local governments will intervene to help on a case-by-case basis.
To prevent such problems from happening again, it is crucial to make sure that two parties shoulder their responsibilities. That is local governments should take responsibility for helping, supervising, and guaranteeing the supply and energy supply enterprises should take primary responsibility.
First, local governments should shoulder the responsibility for helping, supervising, and guaranteeing the supply. Local governments should provide more targeted assistance to enterprises supplying energy for people's livelihoods and help them solve specific difficulties through financial subsidies and other means if necessary. The reason why fuel enterprises in some urban areas have limited purchases and stopped the supply of natural gas, is objectively because, with the accelerated marketization of natural gas, the gas sources of those enterprises have become more diversified. Under the circumstance of a sharp rise in international natural gas prices, the cost of market-oriented gas purchases of some enterprises has grown rapidly. It is difficult to effectively handle these purchases in a short time, so phased operational difficulties are emerging. These problems must be addressed with due attention to both short- and long-range targets. Both symptoms and root causes should be addressed through deepening reform. At present, we will help enterprises on a case-by-case basis. Local governments should strengthen supervision over energy supply enterprises to ensure that they will effectively fulfill their responsibility to ensure supply. In extreme cases, where there is a risk of disruption to supply, local governments should make plans as soon as possible to guarantee supplies unconditionally. Before entering the heating season, the country has clearly required local governments to dispatch working groups to help enterprises involved in energy supply for people's livelihood, especially those in difficulty. We will urge local governments to earnestly implement these measures.
Second, enterprises should actively take responsibility for supplying energy. Enterprises engaged in energy supply for people's livelihood should strengthen their sense of social responsibilities, adhere to their mission of ensuring energy supply for the public good, and remain steadfast in ensuring energy supply and stabilizing prices. When difficulties arise, they should report to the authority instead of limiting purchases or cutting off supply.
Thank you.
_ueditor_page_break_tag_Red Star News:
A set of nuclear energy heating projects, such as the demonstration nuclear heating project at the Hongyanhe nuclear power plant in Liaoning province, have been put into operation. How do those projects work? Will there be a further expansion to nuclear heating in the future? At the same time, how will you ensure the safety of these nuclear heating projects? Thank you.
Zhang Jianhua:
Thank you for your questions. Developing nuclear power in an active and orderly manner is a strategic plan made at the 20th National Congress of the CPC, which is a significant part of our energy strategy. It also plays an important role in optimizing our energy structure, ensuring energy security, building a new type of energy system, and helping to achieve carbon peak and carbon neutralization. At present, a total of 53 nuclear power units are in operation, with an installed capacity of 55.57 million kilowatts, accounting for nearly 5% of the total electric energy production. A total of 28 units with an installed capacity of 32.72 million kilowatts are under construction. Over the years, China's nuclear power units have maintained a good record in safety, with no operation incidents jeopardizing the environment and public safety. In addition, the main operation indicators have remained at an advanced international level.
Nuclear heating means extracting part of steam as a heat source while generating electricity in a nuclear power plant, carrying out a multi-level heat exchange system through heat exchange stations, and ultimately delivering this energy to residents through a municipal heating network. This is a safe and reliable concentrated heating method in urban areas since there are multiple shields to isolate nuclear power units from residents, transferring energy without the contact of mediums. NEA has attached great importance to nuclear heating. In 2019, the first-phase nuclear heating project at Haiyang nuclear power plant in Shandong province was put into operation. The plant was the country's first nuclear heating project and played an exemplary role. The second-phase project, with a heating area of 5 million square meters, has achieved full nuclear heating coverage in all urban areas of Haiyang city. In addition, Qinshan in Zhejiang province and Hongyanhe in Liaoning province have also since achieved nuclear heating. So far, these projects are running very safely and stably, bringing heating to the people. These projects have not only generated ecological and social benefits by replacing coal with nuclear energy, but also reduced local heating prices and improved economic benefits and people's livelihoods by advancing heating quality. It has formed an all-win situation. These projects have all gone down with local people.
At present, the follow-up projects of nuclear heating in Haiyang, Shandong province, and Qinshan, Zhejiang province, are under construction. Large-scale development of nuclear heating is taking shape, making it possible to provide heating over a further distance and a wider area. The NEA actively supports the further development of nuclear heating. Going forward, we will organize the work to summarize the experience of nuclear heating projects in operation, further promote its application under the premise of ensuring safety, and strive to make greater contributions to clean heating in China's northern region. Thank you.
_ueditor_page_break_tag_China News Service:
What have been the climatic features of China since the beginning of winter? What challenges will these conditions bring to China's energy supply? What is your outlook for the weather during the Spring Festival? Thank you.
Zhang Zuqiang:
Thank you for your questions. Since the beginning of winter, China's climate has shown two prominent features. First, from the perspective of temperature, China has been 0.3 degrees colder on average compared to usual, but the temperatures have also fluctuated greatly. In December, the average temperature in China was 1.2 degrees lower than that in the same period on average. From Jan. 1 to yesterday (Jan. 12), the average temperature in China was 2.3 degrees higher than that in the same period on average, so the fluctuations in temperature have been relatively large. The second feature is that overall precipitation has been relatively small. According to our statistics, the national precipitation since the beginning of winter has been nearly 40% less than that of the same period on average.
The main impact on our energy supply is that cold air activity will bring low temperatures, rain, and snowy weather, which will affect energy supply in terms of both supply and demand. On the one hand, low temperatures brought by cold air activity will lead to an increase in residents' demand for heating; on the other hand, rain and snow may create some adverse effects on power supply facilities and raw materials, such as the transportation of coal to generate electric power. Therefore, from the perspective of supply and demand, there exist some pressures. The country's energy management and meteorological departments will maintain close communication and cooperation, respond in a timely manner, and take timely measures to minimize the adverse effects of the weather.
As for the weather during the Spring Festival, sunny to cloudy weather are expected to prevail in the north, while cloudy and rainy weather will prevail in the south. Generally speaking, based on current weather conditions, there will be three cold air events that will affect China. The first is the one that is affecting us now, that is, the large-scale nationwide rain and snowy weather from Jan. 11-15, which is expected to end on Jan. 15 or 16. The second cold air snap will occur between Jan. 19-20, which will affect northern China. The third cold air event will affect most of China's central and eastern regions around Jan. 23. Meteorological authorities will strengthen monitoring and forecasting and release relevant early warning information in a timely manner, making every effort to provide meteorological support services for the people in order to ensure a safe and peaceful Spring Festival.
Thank you.
_ueditor_page_break_tag_Science and Technology Daily:
On the way to its carbon emissions peak and neutrality goals, China has seen its new energy sector including wind and solar power generation gain momentum. It has become an important part of the country's multi-energy supply system. What positive role has new energy played in safeguarding energy supply during winter? Thank you.
Zhang Jianhua:
Thank you for your question. In the past decade of the new era, under the scientific guidance of the new energy security strategy of "Four Reforms and One Cooperation" (namely, reforms in energy supply and consumption, market building and innovation, and comprehensive international cooperation) proposed by General Secretary Xi Jinping, China's new energy sector has made remarkable achievements. In 2022, the newly installed capacity of wind and photovoltaic power reached more than 120 million kW, and their cumulative installed capacity are expected to exceed 700 million kW, driving the installed capacity of renewable energy to top 1.2 billion kW. The wind and photovoltaic power industry has become one of the most competitive ones in the country.
With an increasing installed capacity, wind and photovoltaic power have been playing a significant role in safeguarding energy supply. First, wind and photovoltaic power have taken a bigger share in China's total newly installed capacity. According to statistics, in 2022, the newly installed capacity of wind and photovoltaic power accounted for 78% of the country's total newly installed capacity. Second, the country's newly added power generation capacity has been largely attributed to wind and photovoltaic power. In 2022, China's newly added wind and photovoltaic power generation capacity accounted for more than 55% of its total newly added. Third, the role of wind and photovoltaic power generation in ensuring supply is becoming more and more evident. According to power dispatching data from power grid companies, the average output of wind and photovoltaic power generation in most regions of the country accounted for about 15% of the average power load in 2022, or even 40% at its maximum. During the peak season in the summer of 2022, the average output coefficient of photovoltaic power reached 0.5 during the noon peak period in Jiangsu, Shandong, Zhejiang, and other provinces which have a larger installed capacity of photovoltaic power, providing strong support for the country's safe energy supply. Thank you.
_ueditor_page_break_tag_ThePaper.cn:
Recently, some heat suppliers said they were facing losses, and some even announced that they would stop supplying heat. It is known that heat suppliers are facing tremendous pressure in their business operations. Given this, what measures will be adopted? Thank you.
Lian Weiliang:
Thank you for your question. We confirmed that the situation was true after an investigation. However, this is an individual case, and the problem has been addressed. Despite being an individual case, it reminds us that we need to make more efforts to investigate and identify risks and hidden problems in energy enterprises, in a bid to identify problems early and correct them while they are nascent. We will deal with every single problem that impacts energy and heat supply so as to keep people warm in the winter.
Some heat suppliers said that they are grappling with greater operating pressure due to surging costs in fuels. It is a problem that many enterprises have experienced, but we need to adopt proper and targeted approaches and methods in line with specific cases. We will make greater efforts in five aspects to ensure energy supplies.
First, we will ensure the supply of resources. Regardless of their size or ownership, heat suppliers will all be involved in medium- and long-term coal contracts and strictly follow the contracts' pricing policies to control fuel costs appropriately.
Second, we will ensure the full implementation of policies regarding pricing and subsidies. Local governments should deliver their promised subsidies promptly to alleviate the burden of heat suppliers hit by serious losses due to rising fuel costs. After the heating period, prices should be adjusted according to the law to manage the costs appropriately. The price adjustments regarding people's heating services should be strictly implemented via legal procedures.
Third, we will make sure that local governments take on the responsibility of ensuring energy supplies. If a heat supplier stops their supply, then local governments must take on the responsibility of ensuring heat supply unconditionally.
Fourth, we will implement targeted measures to help enterprises. We will strictly implement a government responsibility system to assist and support heat suppliers. The working group sent by the government should take on responsibilities and make coordinated efforts to deal with the difficulties and problems encountered by enterprises in a timely manner.
Fifth, we will implement the monitoring and fast-handling mechanism to deal with individual cases. While the total amount of heat supply can be ensured, it is crucial to prevent the emergence of various individual cases. We will thus give full play to the coordination mechanism to address individual cases in the supply of energy, as well as the hotline 12398 for complaints and reports on energy supervision across the nation, which has been mentioned by Mr. Zhang. By doing so, we will intensify public opinion monitoring and supervise the handling of individual cases in a bid to ensure that each case is assigned to the relevant department and addressed with feedback. Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
Two last questions.
China Daily:
The global energy supply and demand situation has been grim and complicated since last year, leading to energy supply shortages and drastic price fluctuations. What measures has the NEA adopted to ensure domestic oil and gas markets remain stable? Thank you.
Zhang Jianhua:
Thank you for your question. The Central Economic Work Conference in 2022 pointed out that major enterprises, especially State-owned enterprises, should take the lead in efforts to ensure supply and keep energy prices stable. The NDRC and the NEA have worked with departments, local governments, and enterprises to deal with the drastic fluctuations in the international energy market since the Russia-Ukraine conflict. We have made stepped-up efforts in the following aspects:
First, based on clear market expectations at the beginning of 2022, we have controlled the growth rate of natural gas consumption appropriately and regularly. By doing so, we have prevented large-scale imports of spot LNG products at high prices, while also avoiding the possibility of exacerbating the turmoil in the international market, contributing to our efforts to ensure a stable global market.
Second, we have made great efforts to discover more untapped reserves, and increase production, to ensure supply and maintain the stability of prices. In 2022, China's natural gas production increased by over 10 billion cubic meters, the sixth consecutive year the country has maintained such growth. As the import demand for natural gas is declining, the natural gas self-sufficiency rate, therefore, increased by almost 3 percentage points year on year.
Third, we have made greater efforts to build a new type of energy system with multiple energy sources complementing each other. Coal has been used as an emergency back-up source of power in industrial production or power generation during off-peak hours to reduce the use of natural gas. By doing so, we have ensured that natural gas is used to provide heat for residential homes during the heating season, which is our top priority.
Fourth, we have ensured that centrally administered state-owned enterprises in the oil and gas sectors play a major role in maintaining stable supplies and prices. We have implemented a comprehensive pricing method for the “resources pool” of oil and gas products, which considers prices of domestically produced products, those of the long-term import contracts, and a small amount of the imported spot products. In this way, we have been able to ensure stable prices.
Fifth, we have formulated lists of projects every year since we start to build our energy production, supply, storage and marketing systems. As such, greater efforts have been made to improve our oil and gas pipeline networks and gas storage facilities, with an average annual increase of 100 million cubic meters per day in our supply capacity over the past five years. We have overcome the bottleneck in oil and gas infrastructure capacity since the heating season in 2021. The infrastructure is capable enough to ensure abundant energy supplies during this year's heating season, thus ensuring supplies in terms of total amount and demand during peak hours as long as there are enough resources. Thank you.
_ueditor_page_break_tag_Economic Daily:
It is widely believed that energy enterprises that sign and honor medium- and long-term energy contracts play a crucial role in keeping stability in energy supplies. However, according to some enterprises, the medium- and long-term energy contracts they signed were not able to fully cover their demands, and some of these contracts could not be fulfilled. What will be done to further promote the signing and honoring of the medium- and long-term energy contracts? Thank you.
Lian Weiliang:
Thank you for your question. As has been mentioned, medium- and long-term energy contracts have served as both a ballast and an anchor for keeping energy supplies and prices stable. It is also an important institutional innovation based on China's national conditions to ensure stability in energy supplies and prices. Medium- and long-term contracts are of great significance for stabilizing supply and demand-side expectations, locking resources, controlling costs, and ensuring supplies. Just now, you mentioned some specific cases. After an in-depth investigation, we found that behind these cases exist, to varying degrees, the problem that enterprises did not sign medium- and long-term contracts or the contracts they signed did not fully cover their demands. Therefore, the role of medium- and long-term energy contracts should be given better play to ensure energy supplies. The problem of fulfilling contracts, as you mentioned, still exists. This year, we will take stronger measures to help solve these problems. To be specific, we will ensure that all contracts that should be signed will be signed and that enterprises will be punished for the breach of contracts.
First, we will ensure that all contracts concerned will be signed. In some medium- and long-term energy contracts, whether to include some contents in the contracts is utterly decided by market entities through their negotiations. However, concerning the contents that relate to public interests, people's livelihoods, and ensuring energy supplies, enterprises should officially sign medium- and long-term contracts under the guidance of the government in a well-regulated way. For example, we have made it clear that when it comes to coal for electricity power generation and heating supplies and gas supplies for household use, medium- and long-term contracts should be signed in a well-regulated way under the guidance of the government. It should also be ensured that all contracts concerned are signed. The goal we put forward in this regard is full coverage of 100%. At present, some small-scale heating and gas supply enterprises lack enough knowledge of the medium- and long-term contract system and fail to make full use of it. Some enterprises exist in special stages and are unwilling to sign medium- and long-term contracts. In response to that, we will guide various functional departments at all levels within the government to make greater efforts to publicize and explain the system to enterprises. Some enterprises have stated that they can't get medium- and long-term contracts. Coordination mechanisms to ensure the supply of coal, electricity, oil, gas, and transportation services at all levels will therefore work to solve the problems enterprises encounter when signing these contracts.
Second, we will ensure that enterprises will be punished for the breach of contracts. A credit system is the base of a market economy. Honoring contracts in good faith is the fundamental responsibility of enterprises. While signing contracts is important, fulfilling contracts is more important. Now, as there is a certain gap between prices in the medium- and long-term contracts and those in the market, there are some cases where some enterprises do not perform well in honoring contracts. The government will therefore tighten regulation of all medium- and long-term energy contracts. As of last year, over 300 complaints have been received regarding enterprises failing to follow or fulfill contracts. We have promoted relevant enterprises to rectify their problems, and most of these problems have been corrected. Concerning medium- and long-term contracts designed to ensure energy supplies, especially in contracts relating to coal for electricity power generation and heating supply, a punishment and constraint mechanism has been established to require enterprises that fail to fulfill their contracts offer three times the quantity and the price of resources as prescribed in the contracts. There are five cases where enterprises have failed to abide by their contracts. Since these enterprises refused to rectify their problems, we have taken measures to punish them in accordance with the punishment and constraint mechanism. We have also put these enterprises on a list of severely dishonest enterprises and will continue to monitor their credit. For government-led medium- and long-term energy contracts, especially contracts concerning people's livelihoods, we will ensure that all contracts concerned are signed and fully implemented. We welcome friends from the media and all sectors of society to strengthen oversight and report clues to us about enterprises that fail to abide by contracts, and we will strictly urge them to fully rectify their problems.
Thank you.
Shou Xiaoli:
Thank you to all the speakers and to the friends from the media for your presence. Later we will hold the next press conference. You are welcome to join us then.
Translated and edited by Zhang Liying, Wang Qian, Huang Shan, Zhou Jing, Liu Stiong, Yan Bin, Zhang Junmian, Qin Qi, He Shan, Zhang Rui, Wang Wei, Gong Yingchun, Ma Yujia, Xu Kailin, Li Huiru, David Ball, Daniel Xu, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speaker:
Lyu Daliang, spokesperson of the General Administration of Customs of the People's Republic of China (GACC)
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
Jan. 13, 2023
Xing Huina:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by Mr. Lyu Daliang, spokesperson of the General Administration of Customs of the People's Republic of China (GACC), who will introduce the situation and answer your questions.
Now, I'll give the floor to Mr. Lyu for a brief introduction.
Lyu Daliang:
Ladies and gentlemen, friends from the media, good morning! Welcome to today's press conference. It's a great pleasure to meet you. I'll begin by introducing China's import and export performance for 2022 and then answer your questions.
In 2022, under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, China kept in mind both our internal and international imperatives and coordinated epidemic response with economic and social development, as well as balancing development and security, amid complex and severe domestic and international situations. Despite facing unexpected challenges, China's volume of foreign trade and imports reached new heights, with a steady improvement in their quality. According to statistics from the GACC, China's foreign trade value in 2022 was 42.07 trillion yuan, up 7.7% year on year. Exports saw a 10.5% increase to 23.97 trillion yuan, and imports rose by 4.3% to 18.1 trillion yuan. Specifically, there were five main features, which I will now outline:
First, China's imports and exports are resilient and large in scale. China's foreign trade value exceeded 40 trillion yuan for the first time in 2022, continuing to grow from the high base set in 2021 and reaching a new record high. China has been the world's largest trading nation for goods for six consecutive years. In the first and second quarters of 2022, the total value of imports and exports surpassed 9 trillion yuan and 10 trillion yuan, respectively. In the third quarter, the total value of imports and exports increased to 11.3 trillion yuan, a new quarterly record. In the fourth quarter, the total value of imports and exports remained at 11 trillion yuan.
Second, China's trading partners are well-distributed and have strong growth potential. In 2022, China's imports and exports with ASEAN, the European Union, and the United States reached 6.52 trillion yuan, 5.65 trillion yuan, and 5.05 trillion yuan, respectively, an increase of 15%, 5.6%, and 3.7%, respectively. During the same period, China's trade with countries along the Belt and Road increased by 19.4%, accounting for 32.9% of China's total foreign trade, up 3.2 percentage points. The country's trade with other members of the Regional Comprehensive Economic Partnership (RCEP) increased by 7.5%.
Third, general trade is growing rapidly and its share is increasing. In 2022, China's general trade reached 26.81 trillion yuan, an increase of 11.5%. It accounted for 63.7% of the total foreign trade volume, up 2.2 percentage points. Among general trade, exports rose by 15.4% to 15.25 trillion yuan and imports expanded by 6.7% to 11.56 trillion yuan. During the same period, processing trade reached 8.45 trillion yuan, accounting for 20.1% of the total foreign trade volume.
Fourth, the number of foreign trade entities is increasing and they have strong vitality. In 2022, the number of enterprises involved in exports and imports increased by 5.6% to 598,000. Among them, there were 510,000 private enterprises, an increase of 7%. Their imports and exports reached 21.4 trillion yuan, up by 12.9%, accounting for 50.9% of the total foreign trade volume, up by 2.3 percentage points. Meanwhile, foreign-invested enterprises and state-owned enterprises recorded 13.82 trillion yuan and 6.77 trillion yuan in foreign trade, respectively, accounting for 32.9% and 16.1% of the total foreign trade volume.
Fifth, the main products enjoyed stable supply and demand as well as abundant advantages. In 2022, China's imports and exports of electromechanical products reached 20.66 trillion yuan, up by 2.5% and accounting for 49.1% of the total import and export value. Specifically, exports of solar cells, lithium batteries, and automobiles increased by 67.8%, 86.7%, and 82.2%, respectively. In the same period, the export of labor-intensive products amounted to 4.28 trillion yuan, up by 8.9% and accounting for 17.9% of the total export value. Specifically, exports of bags and suitcases, shoes, and toys rose by 32.6%, 24.4%, and 9.1%, respectively. In addition, imports of energy products such as crude oil, natural gas, and coal totaled 3.19 trillion yuan, up by 40.9% and accounting for 17.6% of the total import value. The import of agricultural products reached 1.57 trillion yuan, up by 10.8 % and accounting for 8.7% of the total import value.
2022 was an essential year in the history of the Party and the country. The 20th CPC National Congress was successfully convened, drawing an ambitious blueprint for building a modern socialist country in all respects. Despite the triple pressures of demand contraction, supply shock, and weakening expectations, as well as many great challenges and difficulties, China still made outstanding achievements in foreign trade, which speaks volumes of its resilience. This is the result of the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core. Over the past year, with a focus on welcoming the 20th CPC National Congress, as well as studying, publicizing and implementing its guiding principles, customs authorities have developed a deep understanding of the decisive significance of establishing Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and establishing the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, resolutely upheld Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and upholding the Party Central Committee's authority and its centralized, unified leadership, and unwaveringly implemented the decisions and deployment of the CPC Central Committee and the State Council. In accordance with the important requirements of preventing the epidemic, stabilizing the economy, and securing development, we have guarded the country's door and promoted the development and efficiently coordinated epidemic prevention and control at ports and the promotion of the steady growth of foreign trade, which has effectively facilitated the stable and quality development of foreign trade and made positive contributions to steady and sound economic growth.
In general, China's foreign trade secured new breakthroughs in 2022, and the scale, quality, and performance of imports and exports improved simultaneously. These achievements did not come easily. Looking ahead to this year, China's foreign trade development will still face many difficulties and challenges as the foundation for our economic recovery is still not solid, the external environment is turbulent, and the downward pressure on the global economy is mounting. While facing these difficulties and challenges, we must also recognize that China's economy enjoys strong resilience, tremendous potential, and great vitality and that the fundamentals sustaining its long-term growth have remained strong. Overall, our economy is expected to pick up this year, and we must be more confident in stabilizing the scale and optimizing the structure of foreign trade.
2023 is the first year when the guiding principles of the 20th CPC National Congress are implemented. The GACC is convening the national customs work conference today to study and deploy the work for 2023. Customs authorities will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly grasp the decisive significance of the establishment of both Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and resolutely uphold Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole, and uphold the Party Central Committee's authority and its centralized, unified leadership. We will earnestly study and implement the guiding principles of the 20th CPC National Congress, effectively implement the major decisions and arrangements of the CPC Central Committee and the State Council, and cement loyalty, carry out missions, guard the door of the country, promote development, and work hard in solidarity. We will keep our feet on the ground and forge ahead, make greater efforts to stabilize the scale and optimize the structure of foreign trade, speed up the construction of modern socialist customs, and make new and greater contributions to promoting a Chinese path to modernization on all fronts.
Now, I would like to take your questions.
_ueditor_page_break_tag_Xing Huina:
Thanks, Mr. Lyu, for your introduction. Now we will open the floor for questions. Please identify the media outlet you represent before raising questions.
Phoenix TV:
Last year, China maintained steady growth in foreign trade. What are the main driving factors? What are your expectations for foreign trade this year? Thank you.
Lyu Daliang:
Thank you for your questions. In 2022, facing the challenges of multiple factors that exceeded expectations, China's foreign trade achieved steady growth based on a high base number in 2021. Its annual volume topped 40 trillion yuan (about 5.94 trillion U.S. dollars) in 2022 for the first time, which made positive contributions to stable and sound economic development. In our view, the main factors driving the growth are as follows:
First, export markets expanded, and major products maintained sufficient competitive advantages. From a market perspective, in 2022, China's export to the ASEAN, the EU, and other major trading partners maintained rapid growth. Thanks to the accelerated expansion of emerging markets, China's export to countries along the Belt and Road rose by 20%, driving overall export growth by 6.1 percentage points. Exports to Africa and Latin America increased by 14.8% and 14.1%, respectively. From a product perspective, China's exports of industrial products increased by 9.9% in 2022, driving overall export growth by 9.4 percentage points. Exports of labor-intensive products maintained rapid growth, and the export growth rate of green and low-carbon products, such as solar cells, lithium batteries, and electric vehicles, surpassed 60%. New drivers of export growth increased rapidly. According to the latest data, China's share of global exports is estimated to reach 14.7%, topping the world for 14 consecutive years.
Second, imports were underpinned by the huge domestic demand. In 2022, the country took into account both domestic and international dynamics, coordinated COVID response with economic and social developments, and balanced development and security. As a result, China's economy saw steady and sound development, with its major economic indicators, such as value-added of industrial enterprises above the designated size and fixed-asset investment, rising continuously, which provided strong support for import growth. In 2022, exports of intermediate goods increased by 7.5%, driving overall import growth by 5.9 percentage points. In addition, high global commodity prices also contributed to the growth of import values to some extent.
Third, supportive policies injected a strong internal impetus for foreign trade development. In 2022, the Chinese government carried out a package of policies and follow-up measures to stabilize the economy. In the field of foreign trade, they included ensuring access to foreign trade, increasing fiscal, tax, and financial support, encouraging new forms of foreign trade, supporting foreign trade enterprises in securing orders and expanding markets, and improving trade security and facilitation. As the efficacy of these policies and measures continues to be unleashed, the vitality of China's foreign trade entities has been stimulated. In 2022, the number of enterprises involved in imports and exports increased by 5.6% compared with the previous year. The three major foreign trade entities -- private, foreign-invested, and state-owned enterprises -- gave full play to their respective advantages, and their import and export operations remained sound.
As for the trend of foreign trade, I have mentioned that we still face many difficulties and challenges. At the same time, our economy is expected to realize an overall recovery this year, and foreign trade development will enjoy many favorable conditions, so maintaining the scale and optimizing the structure of foreign trade have a solid basis. Thank you.
_ueditor_page_break_tag_National Business Daily:
We've noted that the share of private enterprises in foreign trade surpassed 50% last year for the first time. Could you please provide a brief on that? Thank you.
Lyu Daliang:
Thank you for your question. The CPC Central Committee and the State Council have always attached great importance to private enterprises and the private sector. Last year, a package of policies and sustainable measures was issued to stabilize the economy, and then the vitality of various market entities, including private enterprises, was unlocked. According to customs statistics, the number of private enterprises recording import and export performance reached 510,000, with their foreign trade volume totaling 21.4 trillion yuan, up by 12.9%. There are several highlights, as follows:
First, their proportion in foreign trade improved, and private enterprises played a remarkable role in stabilizing foreign trade. The principal position of private enterprises in foreign trade has been consolidated and they have continuously served as a stabilizer. In 2022, the share of private enterprises in the scale of imports and exports reached 50.9%, up by 2.3 percentage points year on year. It's the first time that their annual proportion exceeded 50%. The contribution rate of private enterprises to China's foreign trade growth reached 80.8%.
Second, ties with traditional partners maintained advantages, and emerging markets were vigorously explored. In 2022, the imports and exports of private enterprises to ASEAN, EU, and US, China's top three trade partners, all maintained doubt-digit growth rates, which were 27.6%, 12.6%, and 10.6%, respectively, accounting for 43.9% of private enterprises' total import and export volume. At the same time, the imports and exports of private enterprises to other BRICS countries, Latin America, and the five Central Asian countries grew by 22.1%, 14.5%, and 55.1%, respectively.
Third, the export of mechanical and electrical products and the import of agricultural products grew rapidly. As for exports, in 2022, the export volume of mechanical and electrical products by private enterprises totaled seven trillion yuan, up by 15.3% year on year. Among them, the growth rates of electronic components, electrical appliances, and auto parts reached 22%, 42.5%, and 19%, respectively. As for imports, in 2022, private enterprises imported agricultural products totaling 862.06 billion yuan, up by 14.9% year on year. The growth rates of imported bronze; medicines and medical and medicinal materials; and basic organic chemicals grew by 25.3%, 15.3%, and 8.7%, respectively.
Fourth, private enterprises in central and western regions became more vitalized. In 2022, the import and export of private enterprises in central and western regions grew by 21.5% and 21.2%, respectively, accounting for 20.1% of the total import and export volume of private enterprises, which was 1.4 percentage points higher than that of the previous year.
_ueditor_page_break_tag_CCTV:
Pilot free trade zones and free trade ports are at the forefront of China's opening-up. What work did the customs authorities do last year to promote the development of pilot free trade zones and the Hainan Free Trade Port? Thanks!
Lyu Daliang:
Thank you for your question. The construction of free trade zones and free trade ports is a major policy and plan of the CPC Central Committee and the State Council. In accordance with the CPC Central Committee's requirements on "implementing the strategy to upgrade pilot free trade areas" and "accelerating the Hainan Free Trade Port development ," the customs authorities will continue to deepen reform and promote innovation, accelerate the exploration of institutional opening measures such as rules, regulations, management, and standards, and actively support the development of pilot free trade zones and the Hainan Free Trade Port.
In terms of supporting the development of pilot free trade zones, the customs authorities insists on institutional innovation as the core, upholds replicability and promotion as the basic requirements, and actively carries out the innovation of the customs supervision system in pilot free trade zones. In 2022, local customs authorities filed 33 innovations in customs supervision to the GACC, including a management mode on tracing to the source of Hainan 's offshore duty-free commodities. The GACC reviewed 53 innovative measures previously filed. It formed two innovative systems, including the "enterprise and group processing trade bonded supervision mode" and "international voyage ship transfer data reuse mode,” and replicated and promoted them across the country. Customs statistics show that in 2022, the total import and export value of China's pilot free trade zones was 7.5 trillion yuan, an increase of 14.5%. Among them, the export value was 3.3 trillion yuan, an increase of 18.1%, and the import value was 4.2 trillion yuan, an increase of 11.8%.
In terms of supporting the construction of the Hainan Free Trade Port, the customs authorities insist that “opening-up” can be achieved by way of “management.” We have drafted the “Regulations of the People's Republic of China on the Supervision of the Hainan Free Trade Port ,” and continuously promoted the implementation of early harvest policies such as “zero tariffs" to deliver results. We have accelerated the expansion of the pilot project of the "first-line release, second-line control" import and export policy system, approving and issuing a list of pilot enterprises. We have formed a "Key Work List" for the entire island's customs closed-up operation, and worked out timetables and wall chart operations to prepare for a comprehensive stress test. In the past two years, the import and export of goods at the Hainan Free Trade Port have developed rapidly. After exceeding 100 billion yuan for the first time in 2021, it reached a new level in 2022, breaking through the 200 billion yuan mark for the first time, reaching 200.95 billion yuan, an increase of 36.8%. Among them, the export value was 72.26 billion yuan, an increase of 120.7%, and the import value was 128.69 billion yuan, an increase of 12.8%. Thank you.
_ueditor_page_break_tag_Tianmu News:
We have noticed that China is now managing COVID-19 with measures against Class B infectious diseases and it is no longer included in the management of quarantine infectious diseases. What work have the customs authorities done regarding epidemic prevention and control at ports and stations? Thank you!
Lyu Daliang:
Thank you for your question. Since the emergence of COVID-19, China Customs has fully implemented the decisions and plans of the CPC Central Committee and the State Council, preventing infections and imported cases at ports. We have carried out strict health and quarantine measures for inbound travelers and public transportation. Science-based and targeted measures have been taken to prevent infections of personnel, goods and the environment, to prevent the import of multiple diseases, and to prevent infections via land, sea and air transportation, making contributions to the country's fight against COVID-19.
After China started managing COVID-19 with measures designed for combating category B infectious diseases an d no longer placed COVID-19 under quarantinable infectious disease management , in accordance with the plans of the State Council inter-agency task force and the Frontier Health and Quarantine Law of the People's Republic of China and its detailed regulations, China Customs has carried out relevant work in a steady, orderly and science-based manner.
First, we improved health and quarantine measures at ports for inbound travelers. Following the requirements of the State Council inter-agency task force, we no longer conduct nucleic acid tests on all inbound travelers. Inbound travelers' nucleic acid tests within 48 hours before departure have been included in the customs health status declaration. We have implemented regular health and quarantine measures, including conducting checks on health declaration cards, temperature screening, medical screening and epidemiological investigation. At the same time, we have adopted differentiated response measures based on the results shown on the health declaration cards.
Second, we improved quarantine measures for imported goods. Imported cold chain food will no longer undergo random nucleic acid testing and preventive disinfection measures. Meanwhile, we will continue to apply the strictest possible standards, oversight, punishment, and accountability to ensure food safety. We will maintain contact with the relevant departments of export countries and regions, and urge them to follow the guidelines put forward by the Food and Agriculture Organization of the United Nations on preventing infections. As for non-cold chain products, there will no longer be risk assessments for COVID-19 infections and preventive disinfection measures. Since China started managing COVID-19 with measures designed for combating category B infectious diseases and no longer placed COVID-19 under quarantinable infectious disease management on Jan. 8, customs clearance has been carried out in a smooth and orderly fashion. Thank you.
_ueditor_page_break_tag_CNBC:
Question about the development of cross-border e-commerce in 2022. Are there any countries or regions that have purchased goods from China? What are these goods? What are the prospects for cross-border e-commerce this year?
Lyu Daliang:
Thank you for your questions. First, I will outline the data on cross-border e-commerce. According to preliminary calculations, in 2022, China's cross-border e-commerce imports and exports totaled 2.11 trillion yuan, an increase of 9.8%, with exports and imports increasing by 11.7% and 4.9% to 1.55 trillion yuan and 0.56 trillion yuan, respectively. In recent years, cross-border e-commerce has witnessed rapid development. China has introduced a series of relevant supporting policies to further unleash potential and give full play to the advantages of cross-border e-commerce. Thank you.
China News Service:
We have noticed that ASEAN has remained China's largest foreign trade partner for three consecutive years. Last year, the total value of imports and exports between China and ASEAN grew by 15%. What are the reasons behind the rapid growth in trade between China and ASEAN? How do the customs authorities view the situation? Thank you.
Lyu Daliang:
Thank you for your questions. The bilateral economic and trade exchanges between China and ASEAN have become closer since the two parties established a comprehensive strategic partnership in 2022. Last year, the total volume of imports and exports between China and ASEAN reached 6.52 trillion yuan, an increase of 15%. The volume of exports reached 3.79 trillion yuan, an increase of 21.7%, and the volume of imports reached 2.73 trillion yuan, an increase of 6.8%. During this period, ASEAN saw its proportion in China's foreign trade increase by 1 percentage point from 2021 to 15.5%, maintaining its position as China's largest trade partner.
Specifically, the factors contributing to the rapid growth in trade between China and ASEAN can mainly be attributed to the following aspects.
First, the effective implementation of RCEP has brought trade-creation effects and facilitated cooperation among industrial chains. Over the past year since the implementation of RCEP, the policy dividends have continued to be unleashed, contributing to closer economic and trade exchanges among countries in the region. ASEAN is an important trade partner of China in RCEP. In 2022, China's imports and exports with ASEAN accounted for 50.3% of its total imports and exports with other RCEP members. China's imports and exports of intermediate products with ASEAN increased 16.2% to 4.36 trillion yuan, accounting for 67% of China's total imports and exports with ASEAN.
Second, the ever-improving interconnectivity has facilitated economic and trade exchanges. With the solid progress of the construction of the new western land-sea corridor, the passage of goods in and out of China and ASEAN has become more convenient. Various modes of transportation have developed in a coordinated way, with railway transportation showing significant growth. In 2022, China's imports and exports with ASEAN by rail, water and air increased by 197.6%, 26.7% and 15.5%, respectively. The opening of the China-Laos Railway at the end of 2021 has provided new impetus to further deepen economic and trade cooperation between China and relevant countries. In 2022, among the goods transported by rail between China and ASEAN, 44.7% were through the China-Laos Railway, contributing more than 60% to the growth of imports and exports by rail between China and ASEAN.
Third, cooperation on agricultural goods has deepened, leading to an expansion in imports. In recent years, China has accelerated the pace of importing agricultural products from ASEAN members and continued to optimize quarantine access procedures for agricultural products and other key products. Various agricultural products, such as fresh durians from Vietnam, longans from Cambodia, and passion fruits from Laos, have gained new quarantine access in China. In 2022, the total value of agricultural products China imported from ASEAN rose 21.3% to 246.86 billion yuan, accounting for 15.7% of China's total imports of agricultural products in the same period, 1.4 percentage points higher than the previous year.
Economic and trade relations between China and ASEAN have a solid foundation and great potential for development. Looking forward, the two sides will enjoy broad areas of cooperation, integrated development strategies and smooth trade exchanges. Driven by the continuous improvement of trade and investment liberalization and facilitation, China-ASEAN trade is expected to achieve new and greater development. Thank you.
_ueditor_page_break_tag_Nihon Keizai Shimbun:
We've been keeping an eye on trade between China and Russia. Could you share the data on China-Russia trade in 2022 and the GACC's assessment of trade between the two countries last year? Thank you.
Lyu Daliang:
Thank you for your question. I'll brief you on the relevant data on China-Russia trade. According to customs statistics, our imports and exports with Russia reached 1.28 trillion yuan in 2022, accounting for 3% of China's total foreign trade. In terms of scale, China-Russia trade maintained steady growth in 2022, and bilateral trade reached a new high. Thank you.
Nanfang Daily:
It has been one year since RCEP came into effect, and the benefits continue to be realized. Could you share with us the details about China's trade with other RCEP countries? What has the GACC done to promote the implementation of RCEP? And what has been achieved? Thank you.
Lyu Daliang:
Thank you for your questions. On Jan. 1, 2023, we marked the first anniversary of RCEP coming into effect. Over the past year, China has implemented RCEP with a high level of quality, reaped numerous policy dividends, and further promoted regional economic integration. According to customs statistics, China's imports and exports to the 14 other RCEP member countries in 2022 reached 12.95 trillion yuan, a 7.5% increase, accounting for 30.8% of China's total imports and exports. The trade has the following characteristics:
First, the proportion of imports and exports has steadily increased. As RCEP policy dividends continued to be released, its role in promoting intra-regional trade became more evident. From the first to the fourth quarter, China's imports and exports to other RCEP member countries accounted for 30.4%, 30.5%, 30.7% and 31.4% of China's total import and export in the same period, respectively.
Second, the trade has been dynamic. In 2022, China's trade with eight RCEP member countries exceeded double-digit growth, among which Indonesia, Singapore, Myanmar, Cambodia and Laos all experienced growth of over 20%. Our trade with the ROK was the largest among RCEP countries, reaching 2.41 trillion yuan, a 3.2% increase.
Third, industrial cooperation has been strengthened. In 2022, China's imports and exports of intermediate products to other RCEP member countries reached 8.7 trillion yuan, an 8.5% increase, accounting for 67.2% of China's total imports and exports with other RCEP member countries in the same period. In terms of major commodities, China's exports of mechanical and electrical products and labor-intensive products to other RCEP member countries went up by 13.2% and 20.7%, respectively. Electronic components, batteries and automobiles increased by 15%, 50.3% and 71.6%, respectively. China's imports of mechanical and electrical products, metal ore and ore sands, and consumer goods from other RCEP member countries accounted for 46.2%, 10.4%, and 10.2%, respectively. The import of energy products such as crude oil and natural gas also grew rapidly.
Fourth, private enterprises have had a strong performance. In 2022, the import and export of private enterprises to other RCEP member countries reached 6.56 trillion yuan, up 17.4%. This accounted for 50.6% of China's total imports and exports to other RCEP member countries in the same period, an increase of 4.3 percentage points over the previous year.
Over the past year, the GACC has resolutely implemented the requirements of the CPC Central Committee and the State Council on RCEP implementation and conscientiously carried out various customs-related work.
First, together with the Ministry of Commerce and four other departments, we jointly issued the Guidelines on High-Quality RCEP Implementation, breaking down and refining 16 key tasks in three aspects and promoting the special evaluation of the implementation of RCEP-related measures at customs across the country. Second, we focused on the rules of RCEP in the field of customs inspection and quarantine, and improved relevant rules and regulations. We upgraded the customs operating system, standardized and simplified customs procedures, and continuously optimized the customs clearance process, in a bid to improve customs clearance efficiency and reduce costs. Third, we actively served enterprises, helping them seize the opportunities of RCEP and making full use of various preferential policies. Through publicity, training, seminars, visits and translation of regulations and standards of RCEP member countries, we helped them tap the RCEP market. We have built an enterprise-oriented service system targeting the role of RCEP in reducing technical barriers to trade, and released the interpretation of relevant measures and policies of RCEP members through the official Customs 12360 WeChat account and our portal website. We have introduced the approved exporter system, intelligent verification and self-printing of the RCEP certificates of origin, and other facilitation measures, providing quality services and guarantees for enterprises to enjoy benefits. Thank you.
_ueditor_page_break_tag_Hong Kong Bauhinia Magazine:
As mentioned in the report to the 20th CPC National Congress, the Belt and Road Initiative has become a popular international public good and cooperation platform. Last year, China's trade with countries along the Belt and Road grew faster than the overall growth rate. What are the highlights? Thanks!
Lyu Daliang:
Thanks for your question. This year marks the 10th anniversary of the Belt and Road Initiative. Since its proposal, China's trade with countries along the Belt and Road has become increasingly close. From 2013 to 2022, China's imports and exports with countries along the Belt and Road registered an average annual growth of 8.6%. In 2022, China's trade with countries along the Belt and Road continued to maintain rapid growth, with imports and exports rising 19.4% year on year to 13.83 trillion yuan, 11.7 percentage points higher than the overall growth rate. Among them, exports hit 7.89 trillion yuan, up 20%, and imports reached 5.94 trillion yuan, up 18.7%. Major highlights include the following aspects.
First, its share of China's foreign trade continued to rise. In 2022, China's import and export volume with countries along the Belt and Road reached a record high, accounting for 32.9% of China's total foreign trade, up 3.2 percentage points from the previous year and 7.9 percentage points from 2013 when the Belt and Road Initiative was proposed.
Second, China's imports and exports with the five Central Asian countries, the United Arab Emirates, Saudi Arabia and other trading partners grew rapidly. In 2022, China's imports and exports with the five Central Asian countries, the United Arab Emirates and Saudi Arabia increased by 45.4%, 42.1% and 37.2%, respectively. In the same period, China's imports and exports with ASEAN increased by 15% to 6.52 trillion yuan, accounting for 47.1% of the total value of China's imports and exports with countries along the Belt and Road.
Third, the industrial and supply chains between China and BRI countries have become even more complementary. In 2022, China's exports of intermediate products to BRI countries amounted to 4.44 trillion yuan, up 23.9%, accounting for 56.3% of China's total exports to BRI countries during the same period. Specifically, exports of textiles, electronic components, basic organic chemicals, and auto parts increased by 14.5%, 21.1%, 31.3%, and 24.6%, respectively. In the same period, China's imports of energy and agricultural products saw steady growth, reaching 2.46 trillion yuan and 370.41 billion yuan, up 58.8% and 13.4%, respectively.
Fourth, trade between China's private businesses and BRI countries has shown greater vitality. In 2022, the foreign trade of China's private companies with BRI countries totaled 7.85 trillion yuan, up 26.7%. The figure accounts for 56.8% of China's total trade volume with BRI countries in the same period, up 3.3 percentage points compared with the previous year.
In 2022, the GACC earnestly studied and put into practice the guiding principles of General Secretary Xi Jinping's important speech at the third symposium on the BRI. The GACC took the initiative to promote trade facilitation and security, and work toward the high-quality development of the BRI. First, Chinese customs actively expanded imports of high-quality agricultural products and foods from BRI countries. In 2022, Chinese customs signed 73 documents on inspection and quarantine cooperation with BRI countries, offering quarantine access or enabling trading activities for 60 kinds of agricultural products and foods. Second, focusing on BRI countries, Chinese customs promoted international mutual accreditation of and cooperation on Authorized Economic Operator (AEO) programs and advanced cooperation and exchanges on "single-window customs clearance" for international trade to further improve trade facilitation. Third, Chinese customs doubled efforts to streamline customs clearance procedures for China-Europe freight trains. At the beginning of 2022, the Partnership Program of Customs-Railway Operators for Promoting the Safety and Rapid Customs Clearance of China Railway Express (PPCR) between China and Kazakhstan began its trial phase at the Alashankou Port and Horgos Port. The PPCR arrangement between China and Belarus is also making accelerated progress in a bid to promote unimpeded trade.
Looking ahead, the customs authorities will focus on the high-quality development of the BRI, put into practice the concept of "Smart Customs, Smart Borders, Smart Connectivity ," and broaden and deepen cooperation with customs agencies of BRI countries and regions. In this way, we aim to make greater contributions to promoting policy coordination, infrastructure connectivity, and unimpeded trade. Thank you.
_ueditor_page_break_tag_Red Star News:
Since last year, China has introduced a package of policies and follow-up measures to keep the economy stable. What efforts have the customs authorities made to ensure a steady increase in both the volume and quality of foreign trade? Thank you.
Lyu Daliang:
Thank you for your question. In 2022, the customs authorities resolutely implemented the guiding principles of General Secretary Xi Jinping's important instructions. We acted in accordance with the key requirements of ensuring effective COVID-19 containment, economic stability, and development security. The customs authorities have effectively coordinated the COVID-19 response with the efforts to ensure the stable growth of foreign trade, facilitated the implementation of the policy package and follow-up measures on keeping the economy stable, and spared no effort in ensuring a steady increase in both the volume and quality of foreign trade. Our actions can be mainly summarized in the following aspects.
First, we urged all customs authorities to fully implement the policies and measures for ensuring stable performance in foreign trade. The GACC successively introduced 10 measures to promote stable and improved performance in foreign trade, six measures to support small- and medium-sized enterprises, and seven measures to ease businesses' difficulties and lower their costs. Customs authorities at all levels acted accordingly, rolled out more than 1,300 detailed supporting measures according to specific conditions and the needs of enterprises, and redoubled their efforts in terms of protecting the interests of market entities, optimizing the customs clearance environment for the smooth flow of cross-border logistics, and safeguarding the stability and security of industrial and supply chains based on more careful analysis so as to ensure steady growth in foreign trade.
Second, to keep the operations of foreign trade firms stable, we provided consistent support, improved long-term service mechanisms, and helped them secure orders, expand markets and solve problems. We deepened the reform of diversified customs tax guarantees. We also promoted the practice of a subsidiary applying for customs guarantees with letters issued by the financial company of its parent to further reduce enterprises' financing costs and tax payments during customs clearance. "One policy for one enterprise" helped specialized and sophisticated enterprises that produce new and unique products and top enterprises of various industries to effectively use preferential measures regarding tax reduction and exemption, bonded material circulation, and so on. We supported more enterprises in becoming Advanced Certified Enterprises , facilitated the international mutual recognition of AEOs, and worked to enable enterprises to enjoy the same conveniences at home and abroad. In 2022, an additional 365 enterprises were classified as Advanced Certified Enterprises. We strengthened customs protection of intellectual property rights to inspire enterprises' enthusiasm for innovation. A total of 21,000 protection filings were added, registering an increase of 21%.
Third, to optimize the business environment at ports, we took special-purpose actions to promote cross-border trade facilitation, launched 10 facilitation measures in collaboration with other departments, promoted the application of single-window document processing for international trade, and consolidated the achievements in shortening customs clearance time. We increased the input of manpower and resources for customs clearance at ports, piloted shipside pickup for imported goods and direct loading upon arrival for exported goods at qualified ports, supported the expansion of pilot programs, such as "departure confirmation" and other models, and made every effort to ensure safe and smooth customs clearance at ports and facilitate the import and export of goods. In December 2022, the overall customs clearance time for imports and exports across the country was 32.02 hours and 1.03 hours, respectively, 67.1% and 91.6% shorter than in 2017.
Fourth, to foster new growth drivers in foreign trade, we have continued publicizing policies and measures for cross-border e-commerce. We have promoted central warehouses for the return of imported cross-border e-commerce retail goods and the B2B export supervision model, introduced measures to support enterprises in setting up overseas export warehouses, and continuously improved the quality and level of cross-border e-commerce development. As I said just now, China's cross-border e-commerce imports and exports climbed 9.8% year on year to 2.11 trillion yuan in 2022, of which exports were 1.55 trillion yuan, an increase of 11.7%, and imports were 0.56 trillion yuan, an increase of 4.9%.
In the next stage, customs authorities will thoroughly study and implement the guiding principles of the 20th CPC National Congress, conscientiously implement the decisions and deployment of the Central Economic Work Conference, continue to ensure the full implementation of policies and measures for keeping the economy stable, and go all out to maintain the scale and improve the structure of foreign trade so as to make new contributions to steady economic development. Thanks.
Xing Huina:
Today's press conference is hereby concluded. Thank you, Mr. Lyu. Thank you to all our friends from the media. Goodbye.
Translated and edited by Lin Liyao, Liu Qiang, Mi Xingang, Yuan Fang, Yan Bin, Zhou Jing, Cui Can, Huang Shan, Qin Qi, Wang Wei, Yan Xiaoqing, Zhang Rui, Xiang Bin, Zhu Bochen, Zhang Liying, Liu Sitong, Wang Qian, Wang Yiming, Yang Xi, Xu Xiaoxuan, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Xu Chengguang, deputy director of the 2023 Spring Festival Transportation Special Group and vice minister of transport
Chen Kai, deputy director of the State Post Bureau
Wan Xiangdong, chief pilot of the Civil Aviation Administration of China (CAAC)
Huang Xin, director of the Passenger Transport Department of China Railway
Cai Tuanjie, deputy director of the Office of the 2023 Spring Festival Transportation Special Group and director general of the Transport Service Department of the Ministry of Transport (MOT)
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
Jan. 6, 2023
Xing Huina:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by Mr. Xu Chengguang, deputy director of the 2023 Spring Festival Transportation Special Group and vice minister of transport. Mr. Xu will brief you on the work to ensure services during the Spring Festival travel rush and take your questions. Also joining us today are Mr. Chen Kai, deputy director of the State Post Bureau; Mr. Wan Xiangdong, chief pilot of the Civil Aviation Administration of China (CAAC); Mr. Huang Xin, director of the Passenger Transport Department of China Railway; and Mr. Cai Tuanjie, deputy director of the Office of the 2023 Spring Festival Transportation Special Group and director general of the Transport Service Department of the Ministry of Transport (MOT).
Now, I'll give the floor to Mr. Xu Chengguang for a brief introduction.
Xu Chengguang:
Ladies and gentlemen, friends from the media, good morning. It is my pleasure to meet with you here. To begin with, I would like to thank the friends from the media for their interest in the plans regarding the Spring Festival travel rush and their support for our work concerning transportation. Today, my colleagues, Mr. Chen, Mr. Wan, Mr. Huang, Mr. Cai, and I will brief you on the measures to ensure transportation services during the 2023 Spring Festival.
The Spring Festival travel rush in 2023 is the first of its kind since the 20th National Congress of the Communist Party of China (CPC) and also the first since China's COVID-19 response entered a new stage. The CPC Central Committee and the State Council have attached great importance to it. The matter has drawn widespread attention from all sectors of society, and the people are looking forward to it. To ensure a smooth Spring Festival travel rush, we will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the guiding principles of the 20th CPC National Congress, and put people and their lives first. We will better coordinate epidemic prevention and control measures with economic and social development. We will meet people's needs for a better travel experience and maintain normal economic and social order, regard them as our fundamental missions, and make every effort to ensure steady and orderly operation during the upcoming Spring Festival travel rush.
The Spring Festival travel rush this year will last for 40 days, running from Jan. 7 to Feb. 15. Compared with previous years, passenger flows and the pandemic situation have reached peak levels simultaneously in 2023, making the upcoming travel rush the most uncertain, complicated and challenging in recent years. In general, this year's Spring Festival travel rush has the following four features. First, passenger flows will increase significantly. As China has classified and also treated COVID-19 as a category B infectious disease, more people will engage in cross-regional travel at an accelerated pace. In addition, people's demand for returning to their hometowns during Chinese New Year, visiting friends and family, and traveling will be unleashed collectively. As a result, passenger flows during the upcoming Spring Festival will recover from a long-term low level and see rapid increase, while transportation organizations will operate at full capacity. According to preliminary analysis, around 2.095 billion passenger trips will be made during this year's Spring Festival travel rush, up 99.5% year on year, which will recover to 70.3% of the same period in 2019. In terms of the structure of passenger flows, it is estimated that family visits will account for 55% of the total passenger flows, work-related travel 24%, and tourism and business trips 10% each. As many universities and colleges started their winter vacations before the travel rush, students will account for a relatively small proportion of passengers compared with previous years. More people will choose to travel by driving, using intercity car-pooling services, and taking chartered buses . Estimates suggest that expressways nationwide will report an average daily flow of 26.2 million passenger cars, up 3.6% year on year. In terms of the times and places people will travel, it is expected that before the Spring Festival, the majority of people will travel from large cities to nearby cities and provinces that are major exporters of labor. As family visits and work-related travel are to overlap, passenger flows will report growth. After the Spring Festival, people will travel from major labor exporting provinces and small- and medium-sized cities to central cities. Passenger flows during this period will be relatively staggered and reach peaks on around Jan. 27 and Feb. 6. Second, the demand for freight transport will rise significantly. The Spring Festival travel rush in previous years has often seen an increase in passenger flows and decrease in freight transport. However, as the pandemic situation is set to reach peak levels during the upcoming Spring Festival, the freight volume of all sorts of medical supplies and preventative materials, daily necessities for the holidays, and key materials such as energy and food for winter and spring will surge. In particular, in small- and medium-sized cities and rural regions with poor logistics infrastructure, parcel delivery may be delayed in certain areas as front-line delivery workers will return to their hometowns and possible large-scale infections will cause personnel shortages. Therefore, we will face mounting pressure in coordinating passenger flow with freight transport during the Spring Festival travel rush and ensuring the smooth operation of both. Third, front-line workers are at a greater risk of infection. The Spring Festival travel rush will see intensive passenger flow and frequent freight transport. As such highly-efficient transport activities overlap with the peak of the pandemic, the risk of large-scale infection among front-line transportation workers will surge, and there will be greater pressure to ensure unimpeded services of passenger flows and freight transport. Fourth, risks and hidden dangers concerning workplace safety will increase. Since 2020, due to the repeated impact of the pandemic, China's transport sector has been facing a complicated situation where the risks of traffic safety and pandemic-related incidents intertwined. Particularly, the sector has been operating at a low capacity for a long period; vehicles have either been out of service or operating at a low capacity for a long time; the working skills of employees in the field have been getting rusty; and there are often more traffic accidents around Chinese New Year due to frequent severe weather conditions such as low temperatures, cold fronts, rain, snow and sleet. All of these pose severe challenges to workplace safety. In order to strengthen the management of workplace safety, prevent major accidents, effectively respond to emergencies and ensure people's safe traveling experience, all levels of the transportation sector should make more greater efforts.
It is worth noting that this year's Spring Festival travel rush is marked by many uncertainties, making it difficult to rely on past experience to analyze and assess the situation according to established rules. The current projections on the total volume, composition, and direction of passenger flow are based on current circumstances. They are intended to consider worst-case scenarios, make more solid preparations, and provide better services in accordance with bottom-line thinking. This will allow us to be fully prepared for epidemic prevention and control and transport service guarantees during the Spring Festival travel rush. We will closely track the situation, continuously study and assess it, and promptly optimize and adjust our measures to ensure sound transportation services during the Spring Festival.
Facing these challenges and pressures, the Party Central Committee and the State Council have put forward three precise requirements of "meeting the travel needs of the people, reducing the risk of COVID-19 transmission, and providing safe and convenient services." Leading comrades of the Central Committee have repeatedly issued important instructions and made clear requirements. Transport departments at all levels have made adequate preparations in accordance with the "highest standards, strictest requirements, and most practical measures." At the national level, with the approval of the State Council joint prevention and control mechanism, a special task force on Spring Festival travel rush was set up under the State Council joint prevention and control mechanism, led by the MOT and involving 16 ministries and units. A series of documents have been issued, including the Overall Work Plan for Epidemic Prevention and Control and Transportation Service Guarantee during the 2023 Spring Festival Travel Rush. In addition, a series of specific measures have been formulated, such as guidelines for epidemic prevention and control during the Spring Festival travel rush. A national television and telephone conference was held to systematically deploy the work. Regions and relevant departments have also made specific arrangements according to the deployment of the Spring Festival travel rush task force. At present, all preparations are basically in place.
The annual Spring Festival travel rush is always a big test for transport authorities, but this year's "exam" may prove even more challenging. General Secretary Xi Jinping said that when faced with major and difficult tasks, one's sense of responsibility and bravery in taking on the challenge is tested. All transportation workers fully understand the extreme importance of doing a good job in ensuring sound transportation services during the Spring Festival this year. We consider providing transportation services during this year's Spring Festival as an important test for implementing the spirit of the 20th CPC National Congress. To ensure that people travel safely and successfully during the Spring Festival, we will utilize our maximum capacity and provide the best services and conditions to create a safe, healthy, convenient, and comfortable transportation experience. We will do our utmost to ensure that the "first" and "last" kilometers of the journey home are smooth and organized, with a sense of responsibility to work hard for the benefit of the public and with a determination to collaborate and support each other. In this way, we aim to contribute to a peaceful and joyful Spring Festival for the people and to give a satisfactory answer to the Party and the people.
That's all for my introduction! Now, my colleagues and I would like to take your questions. Thank you!
_ueditor_page_break_tag_Xing Huina:
Thank you for your introduction, Vice Minister Xu Chengguang. Now we will open the floor for questions. Please identify the media outlet you represent before raising a question.
China Media Group:
The 2023 Spring Festival travel rush kicks off tomorrow. Just now, the spokesperson mentioned that this year's Spring Festival travel rush will see a significant increase in passenger flow. Could you provide us with a more specific forecast? Additionally, what measures has the transportation department put in place to ensure smooth and organized travel for the public? Thank you.
Xu Chengguang:
Thanks for the questions. In an earlier briefing, I explained the total amount of passenger traffic and their possible destinations. We predict massive growth in passenger traffic during this year's Spring Festival travel rush, nearly double that of the previous year. However, passenger traffic will only reach 70% of what it was in 2019. In the first place, I want to say that we fully consider the anticipated demands of public transport, maintain bottom-line thinking, and consider extreme scenarios such as huge passenger traffic, large numbers of infections among transportation workers, and a high frequency of safety accidents. We are fully prepared according to the three principles of full preparation, allocation according to demands, and timely responses. We have the ability to provide the public with adequate transportation services. There are four specific measures:
First, we will strictly implement relevant policies. We will follow the related policies and regulations of the Joint Prevention and Control Mechanism of the State Council and carry out measures to optimize pandemic prevention and control and manage COVID-19 as a Class B infectious disease, through well-conceived and precise approaches. We are committed to implementing pandemic prevention and control policies in the railway, road, waterway, civil aviation, and post and delivery sectors to enhance the protection of passengers and people working in such sectors. The special task force set up for the Spring Festival travel rush will coordinate member entities to strengthen guidance and planning. We will explore policies regarding flexible and staggered holidays to relieve the congestion of people visiting families and reduce concentrated travel pressure. For the movement of migrant workers, we will determine a reasonable timetable for temporarily stopping work before the holiday and resuming work afterward for workers to travel home and back to work at various times. For the movement of students, we will adjust and optimize holiday arrangements and guide students to return to school at staggered intervals to avoid heavy traffic. For the movement of tourists, we will set a reasonable ceiling for tourist numbers to ensure orderly movement.
Second, we will strengthen the coordination of transport capabilities. We will take full advantage of comprehensive transportation, enhance the effective linkage of different transportation modes, and enhance coordination regarding operating time, organization and arrangement of traffic capacity. We will try our best to handle the dispersal of large passenger flows to smooth their "last mile" of travel. For migrant workers and students, who tend to travel at similar times, we will provide team service and door-to-door service to ensure the orderly movement of workers and staggered travel time of students. If conditions allow, point-to-point chartered vehicle services will be arranged. To address people's travel demands for visiting family and shopping at fairs in rural areas, shifts will be increased for passenger routes between urban and rural areas. Operating hours will be extended, and reservation services will be improved. We will do more to ensure transportation services are provided.
Third, we will optimize passenger services. To improve services for the Spring Festival travel rush, we will work hard to refine the travel experience of the public. Information sharing and capacity coordination between different transportation modes will be enhanced to improve passenger transfer efficiency. Ticket services will also be upgraded, and information about passenger transport will be released via multiple channels and in a timely manner. The pre-ticketing service will be available in advance for passengers so they may arrange travel at staggered intervals. We will assess passenger traffic according to changes, increase ticket windows, self-service terminals and security lanes in a timely manner, and promote measures such as online ticketing, e-ticket, and self-service ticket checking to expand paperless and non-contact services. We will improve barrier-free facilities and offer necessary help to passengers in need, including elderly people, children, sick people, people with disabilities and pregnant women.
Fourth, we will strengthen services for managing the road network. We will reinforce the monitoring of main road networks and city roads, pay close attention to traffic on road networks near provincial boundaries, in popular cities and around important scenic areas, and promptly release information about road conditions and traffic congestion. We will guide drivers to choose their routes, travel time and destinations rationally to avoid peak traffic. We will ensure the operation of expressways and service areas, roads, waterways and locks, and commercial passenger transport services, and ensure services such as refueling, battery charging, dining and restrooms at service areas.
And in the second place, although the pandemic is not over yet, and some places are still experiencing peak infection levels, many people still wish to return home for the Spring Festival to visit relatives and friends. However, we strongly encourage everyone to make reasonable travel decisions considering their own personal circumstances and those of their family members. This is particularly important for elderly individuals with underlying health conditions and families with expectant mothers, infants and children, as they should minimize travel to lower the risk of infection during the journey for themselves and their family members. People using public transport to travel home for the Spring Festival should strengthen self-protection, wear masks throughout the journey, ensure personal hygiene, and actively avoid traveling while still having symptoms. Thank you.
_ueditor_page_break_tag_ThePaper.cn:
What is the CAAC's forecast for civil aviation transport during this year's Spring Festival travel rush? What preparations have been made to guarantee civil aviation services during the travel rush?
Wan Xiangdong:
Thank you for your question. As the first travel rush after China optimized its virus prevention policies and the downgrading of the management of COVID-19 from Class A to Class B, it is expected that the number of passengers traveling by civil aviation will increase significantly. During the Spring Festival travel rush, civil aviation departments nationwide will schedule 11,000 passenger flights on average per day, which is about 73% of that during the 2019 Spring Festival travel rush. It is expected that the overall passenger flow will exhibit characteristics of staggered travel for school holidays and going back to school, for returning home and getting back to work, and for trips and other journeys. There will still be peak passenger levels around the Spring Festival holiday and after the Lantern Festival. Based on current ticket bookings for the Spring Festival travel rush, the peak appears from Jan. 18 (the 27th day of the 12th lunar month) to Jan. 20 (the 29th day of the 12th lunar month). Given the booking volume, air routes, including Beijing to Sanya, Shanghai to Beijing, Beijing to Haikou, Shenzhen to Kunming, Shenzhen to Chongqing, Hangzhou to Kunming and Shenzhen to Chengdu, rank among the top.
On the premise of ensuring safety, the CAAC actively guides airlines to arrange flight plans in a rational and well-conceived manner to ensure transport capacity and guarantee resources.
First, we support adding domestic flights during the Spring Festival travel rush and encourage airlines to deploy capacity more flexibly. This will accommodate passenger travel to popular destinations and along popular routes, such as routes from Beijing, Shanghai, Guangzhou and other cities to Sanya, Haikou, Chengdu and Chongqing.
Second, we require all airports to strengthen contact with Spring Festival travel agencies of local governments, and inform them in advance of information, including arrival and departure flights at night and passenger volume, so that they can actively cooperate to ensure a smooth connection with the "last-mile" in urban traffic. As of Jan. 5, on top of regular domestic passenger flights, 10,313 domestic flights had been approved to be added during the Spring Festival travel rush, including 3,459 flights along routes involving Beijing, Shanghai and Guangzhou, accounting for 33.5% of the total added domestic flights. This will effectively meet passengers' travel needs to popular places and along popular routes.
In terms of guaranteeing aviation services, all civil aviation departments will continue to follow the people-centered development philosophy and implement the work requirements of providing earnest services. The goal is to improve people's sense of security, gain and happiness for civil aviation services and ensure passenger services during the Spring Festival travel rush.
First, we will fully consider subjective and objective factors such as the market and weather and further optimize flight schedules, to effectively reduce the inconvenience caused to passengers by flight cancellations and delays.
Second, we will ensure epidemic prevention and control, guide passenger flow, reduce passenger gatherings, and try our best to provide non-contact services to passengers. We have tested and monitored the health conditions of front-line employees, and cleaned, disinfected and ventilated key places to reduce infection risks for passengers, so as to ensure safe and sound trips for them.
Third, we will ensure all aspects of service are properly attended to both onboard and on the ground. Specific focus will be given to passengers with special needs, including those with disabilities, the elderly, and unaccompanied children, in order to create a civilized, warm and harmonious travel environment.
Fourth, we will increase the answering rate of customer service calls by taking measures like increasing hotlines and service personnel to promptly handle passengers' various service demands. Thank you.
_ueditor_page_break_tag_China Transport News:
Railways play an important role in the Spring Festival travel rush every year. What new measures will the railway authorities adopt this year? Thank you.
Huang Xin:
Thank you for your question. As regards this year's travel rush, China Railway will conscientiously implement the relevant deployments and requirements of the CPC Central Committee and the State Council on the work of the Spring Festival travel rush, continue to adhere to the people-centered development philosophy, take better-coordinated steps to respond to COVID-19 and the travel rush, and better coordinate development and security. We will optimize the train operation plan for the Spring Festival travel peak season, and accurately implement the epidemic prevention and control measures. On the basis of reviewing good practices from the past, we will launch a series of measures to help people in different links of purchasing tickets, waiting and boarding, so as to ensure safe, orderly and warm Spring Festival travels, and provide passengers with a better travel experience.
In terms of capacity arrangement, we will make scientific and precise arrangements. We will coordinate and make good use of new lines and new stations opened last year, as well as newly operated advanced equipment such as Fuxing bullet trains, to enhance the overall function of the rail network and improve passenger capacity. Following the principles of "sufficient arrangements, on-demand start, quick response and emergency preparedness," we will scientifically arrange the train operation schedule.
In terms of orderly travel, it is necessary to create a healthy and safe travel environment for passengers. We will conscientiously implement various measures for COVID-19 prevention and control and security management, strengthen the organization of passenger flows at stations, strictly control the occupancy rate of trains, and guide passengers to enter stations and wait for trains in an orderly manner, and maintain a safe distance. We will strengthen ventilation and disinfection in key places to maintain a good environment in trains and stations, actively promote contactless services, strengthen the promotion of travel health tips, improve employee health management, and guide passengers to wear masks throughout the entirety of their journeys to enhance their own health protection.
In terms of station and train services, we will focus on introducing measures to improve convenience for passengers in three aspects. First, we will improve ticket purchasing services. We will further optimize the 12306 online ticket purchasing system, expand the application of electronic tickets, and fully implement digital management in the links of excess fare payment at stations and trains. Second, we will no longer set time requirements for student discount tickets. Students can purchase four one-way discount tickets at any time in each school year, which are convenient for them to use at any time throughout the year. Third, if a passenger refunds a ticket due to railway liability or force majeure, all connecting tickets can be refunded at the same time, and the refund fee will be waived. Passengers will no longer be charged a service fee for excess fares or changing tickets. Meanwhile, we will expand the scope of trains with discounted fares in the non-peak direction.
Regarding travel information services, we will introduce code scanning services on more than 3,200 high-speed trains. Passengers can scan the code on their armrest to check travel service information related to arrival and departure time, train locations, trains available for transfer, and transportation of other vehicles. They can also buy food and beverages, pay for ticket extensions, upgrade their seats and search for lost belongings. Meanwhile, we will improve the message notification mechanism of 12306 to ensure that passengers who have booked tickets via 12306 and logged accurate contact information receive updates about the suspension of trains and information changes. This will enable them to get up-to-date information about train operations and make better travel arrangements.
In terms of transfer services, passengers are particularly concerned about transfer information during the Spring Festival travel rush. The number of stations where intra-station transfers are available has increased from 80 to 100. We will also improve service facilities and upgrade signposts to improve transfer efficiency and provide convenience for passengers during the Spring Festival travel rush. Thank you.
_ueditor_page_break_tag_China Daily:
We noticed that delivery delays and congestion occurred in many places some time ago. What measures has the State Post Bureau taken to respond to this and what is the specific situation like now? Thank you.
Chen Kai:
Thank you for your questions. As you mentioned in your questions, couriers in some cities have been getting infected since mid-December last year. Some distribution centers and outlets could not operate normally due to labor shortages, which affected parcel handling and delivery. At the same time, due to the decline in circulation efficiency, the delivery efficiency of some outlets and related terminals was affected, resulting in partial backlogs. As we all know, the courier sector is a typical network economy. If one link is affected, it will spread to the whole network. We noticed that delivery was slow some time ago. In response to this, the State Post Bureau has paid close attention, made all-out efforts to remove obstacles in the postal and courier sector and focused on daily scheduling, careful deployment and smoothing terminal circulation to ensure the efficient operation of the postal express network. We have done our work in the following four aspects:
First, we strengthened network operation guarantees. We urged delivery firms to assume their social responsibility, asking them to minimize service interruptions caused by out-of-service outlets and minimize operational disruption due to the reduced efficiency of front-end collection to ensure the smooth running of the postal express network to the greatest extent. Delivery enterprises have also formulated work programs and emergency plans according to epidemic developments specific to different regions and stages to allocate staff scientifically and ensure the regular operation of staff on duty to the maximum extent.
Second, we ramped up efforts to replenish the workforce. We guided delivery enterprises to ensure consignment in key areas, in key links, and of essential materials. They increased employee attendance and strove to maintain the service capacity through regional adjustment, temporary reassignment of management personnel, recruitment of temporary workers, and speeding up the return to work.
Third, we ensured the health and safety of delivery workers. We have guided local postal administrations to actively seek resources from local governments to provide greater support to the industry in terms of vaccines, antigen test kits, medicines, and N95 masks. We've also instructed them to speed up distribution to ensure the effective protection of frontline express delivery workers. Localities like Shanghai and Jiangsu have offered subsidies to those on duty on the frontline.
Fourth, we accelerated the handling of backlogged packages. We have urged relevant companies to improve resource allocation, coordinate personnel, and speed up the handling of backlogs, while making sound preparations for potential package increases. We have guided company headquarters to formulate incentive policies to support terminal outlets in speeding up package flow. We have also encouraged terminal outlets to increase working capacity and effectively handle backlogged packages. These policies include increasing working efficiency, optimizing delivery routes, extending service time, and offering delivery services during night hours.
We have seen that, through continuous efforts in the previous stage, 94.9% of delivery workers nationwide had resumed work as of yesterday, the number of backlogged packages had sharply dropped, and express delivery services had effectively resumed. In the first five days of this year, the daily express delivery volume reached 370 million packages on average, up 16.7% compared with the same period last year. Going forward, the State Post Bureau will continue to mobilize the whole industry to consolidate work achievements and strengthen the foundation for stable industrial operation, do its best to ensure smooth delivery, and effectively meet the needs of the people for delivery services.
We will further urge relevant enterprises to increase their package handling efficiency according to the changing epidemic situation in different regions, and urge companies to increase their efforts to properly handle complaints and appeals and effectively resolve related problems and disputes, so as to meet the people's needs for delivery services. Thank you.
_ueditor_page_break_tag_Phoenix TV:
My question is for the Civil Aviation Administration. What are the arrangements for flights to and from Hong Kong, Macao and Taiwan during the Spring Festival travel rush? Is there going to be a significant increase? Thank you.
Wan Xiangdong:
Thank you for your questions. The Civil Aviation Administration has always cared for air routes to and from Hong Kong and Macao as well as cross-Strait flights and supported airlines in opening air routes and flights to Hong Kong, Macao and Taiwan in accordance with the air transport arrangement between the mainland and Hong Kong and Macao as well as the cross-Strait air transport agreement.
In 2022, the Civil Aviation Administration issued or renewed 16 Hong Kong air operating licenses and three Macao air operating licenses. As of Jan. 5, the Civil Aviation Administration had approved a plan for 13,230 passenger flights to and from Hong Kong, Macao and Taiwan during the Spring Festival travel rush, involving 186 air routes and 47 waypoints on the mainland. Twenty-eight airlines will arrange 2,331 passenger flights every week.
After Jan. 8, airlines will independently and dynamically optimize the arrangement for passenger flights to and from Hong Kong, Macao and Taiwan based on the same principles as international ones — safety first, market-oriented, and special needs prioritized. Take Shanghai Pudong International Airport as an example. According to the flight scheduling of various airlines operating at the airport, from Jan. 8 to 31, there will be 30 daily passenger flights to and from Hong Kong, Macao and Taiwan taking off or landing at the airport. Among them, 10 are Hong Kong flights, eight are Taiwan flights, and 12 are Macao flights, all showing a significant increase. As market demand increases over time, we believe the number of flights will increase further. Thank you.
_ueditor_page_break_tag_Cover News:
It is expected that this year will see an increase in passenger flows compared to previous years. How will the transport authorities ensure the safety of passengers and guarantee emergency responses to avoid major traffic accidents? Thank you.
Cai Tuanjie:
Thank you for your question. Safety has always been our top priority during the Spring Festival travel rush. We can have a peaceful Spring Festival only if we do an excellent job of providing security. This year, we face significant challenges in conducting safety inspections for the travel rush due to multiple factors, including increasing passenger and cargo flows, the changing epidemic situation and extreme weather. We have already made systematic arrangements for ensuring safety and emergency responses for the travel rush. Next, we will guide local governments to pay close attention to passenger and cargo flows, the weather and the epidemic situation. We will also direct them to focus on core elements such as passengers, vehicles and roads. Multiple efforts will be made to guide local governments to take concrete steps to fully secure a safe Spring Festival travel season.
First, we will strengthen the inspection and maintenance of facilities and equipment. Some of our facilities and equipment have been operating at low capacity, leading to an increased risk of safety hazards. We will urge transportation companies to fully implement all safety production requirements and conduct comprehensive inspection and maintenance on facilities and equipment planned to be used during the Spring Festival travel season, to ensure they are in good technical condition. We will prevent problematic facilities and equipment from operating.
Second, we will strengthen our efforts to raise safety awareness among employees. Some of our employees' skills have become rusty due to the low workload. We will guide transportation companies to conduct targeted training and safety education for all employees engaged in the Spring Festival travel season, especially drivers, to enhance their awareness of safe driving. We must conduct strict checks on drivers to ensure they can perform their work duties safely. If drivers have symptoms such as a fever or are unable to work due to physical conditions, they should not be made to work. We should ensure that employees are fit for duty and that vehicles are fit for operation.
Third, we will strengthen the dynamic monitoring of transportation vehicles. We will monitor and manage tourist buses, passenger buses, vehicles transporting dangerous goods, and high-speed ferries during their operation, and promptly discover and address violations of laws and regulations, including speeding and driving while tired. We will urge transportation companies to pay close attention to weather changes and road traffic conditions, and promptly adjust or suspend transportation plans for those not meeting safe traffic requirements. We strictly prohibit dangerous operations and transportation.
Fourth, we will strengthen efforts to ensure safety on the road network. We will guide local governments to strengthen the monitoring of key road sections and road networks and conduct risk assessments on road sections such as large and long bridges and tunnels, as well as long, continuous downhill slopes, to address safety hazards in a timely manner. We will release information on weather and traffic control to facilitate the public in making travel plans. Suppose there are extreme weather events, such as cold waves, freezing rain and snow, and dense fog. In that case, we will publish weather warnings and conduct emergency responses, as well as carry out snow removal and deicing work in a timely manner, to recover road conditions as soon as possible. We will step up efforts to provide health services for passengers. We encourage passenger hubs, highway service areas, "driver's homes," and other places where conditions permit to set up "health stations" and health service points to provide drivers and passengers of private cars, passenger buses and cargo trucks with medicine and separate areas for rest. It is particularly important to mention that we do not encourage drivers with symptoms to get behind the wheel. If they have symptoms during their work, they need to rest and get medicine at the nearest service area. It is also advisable to avoid driving after taking medication and only return to work after resting to ensure safety.
Fifth, we will step up our duties and emergency response capabilities. During the Spring Festival travel rush, transportation departments at all levels will strictly implement the 24-hour duty plan with both leaders and assigned persons on duty to closely monitor the situation of the travel rush. In case of emergencies like adverse weather and traffic congestion, we will organize, coordinate and direct the emergency response in time to ensure smooth and orderly progress during the Spring Festival travel season. When people are stranded, hot water, food and necessary health services will be provided in time to enhance their sense of fulfillment regarding Spring Festival travel services.
During the Spring Festival travel season, many people from rural areas travel to return home, visit relatives and friends, and go to fairs. We will strengthen transport capacity and safety supervision. We will work with related departments to strengthen law enforcement supervision by focusing on rural passenger transport routes, passenger terminals and ferry ports. Here, I'd like to remind travelers to enhance their awareness of self-protection and safe travel. It is suggested to travel in legal vehicles, reject vehicles with passengers beyond the seating capacity, fasten seat belts, resolutely eliminate driving a vehicle without a license plate or driver's license, and avoid drunk driving to prevent and curb safety accidents.
Safety work is a journey to which there's no end. Let's work together to ensure a safe, smooth and orderly Spring Festival travel season so everyone can have a happy and peaceful Spring Festival. Thank you!
_ueditor_page_break_tag_Hong Kong Bauhinia Magazine:
What progress has been made to ensure a smooth flow of logistics during the Spring Festival travel season? What efforts will be made to ensure efficient and orderly transportation of medical and livelihood supplies? Thank you.
Xu Chengguang:
Thanks for your questions. I will answer them.
For this year's Spring Festival travel rush, we have made full preparations for organizing the passenger transport and ensuring the smooth flow of transport and logistics, which will be coordinated and managed respectively by the Spring Festival travel season work team under the State Council inter-agency task force for COVID-19 response and the office of the leading group for the smooth flow of logistics under the State Council. In terms of transport and logistics, transportation arteries and logistics microcirculation in China are generally smooth. Key logistics hubs are running steadily. Major logistics indicators are stable and improving. The transportation of key supplies is safe and orderly. We are fully capable of meeting the transportation needs of supplies.
But at the same time, the public demand for medical supplies such as COVID-19 medicines, antigen detection reagents, masks and vaccines has surged recently. Given this situation, the office of the leading group for the smooth flow of logistics under the State Council, which considers it a priority, is strengthening overall deployment and coordination and sparing no effort to ensure the smooth transportation of medical supplies.
First, we need to connect supply and demand to ensure a timely response to demand. We will track the epidemic changes, monitor the transportation needs of key medical supplies across the country, and urge and guide local transport authorities to contact the 286 key enterprises ensuring medical supplies designated by the medical supplies group under the State Council inter-agency task force for COVID-19 response, taking the initiative to provide them with the needed services and make differentiated policies. For example, we have guided SF Express Group and China Post Group to customize their logistics plans to guarantee the daily transportation of 16,000 orders of Lianhua Qingwen capsules produced by Shijiazhuang Yiling Pharmaceutical, achieving "zero backlogs" in medical transportation and distribution. We have also promptly coordinated and solved the transportation problems of medical supplies for Fengyuan Pharmaceutical in Anhui and Fenhe Pharmaceutical in Shanxi.
The second is to ensure efficient traffic and smooth and orderly logistics. The transportation of medical materials requires a higher level of timeliness and precision than that of general materials. We have set up a daily scheduling system to enhance dispatching in key provinces and key logistics enterprises, ensuring the timely delivery of medical supplies. We will strictly implement the policy of giving priority to free passage on expressways for vehicles transporting COVID-19 vaccines to ensure safe and efficient deliveries.
The third is to smooth the end circulation to ensure timely delivery of materials. In some cities, a shortage of front-line couriers has caused poor delivery at the end of logistics. We have solved such problems as quickly as we can. We immediately carried out dispatch and deployment, urged timely recruitment of delivery personnel, encouraged businesses to open as many outlets as possible, prioritized the delivery of backlogged medical and prevention and control supplies, and worked hard to smooth the final delivery of medical materials.
Next, we will continue to focus on the transportation needs of medical supplies, promote the connection between supply and demand, ensure efficient passage, smooth the final delivery stage, and ensure efficient and orderly transportation of key materials. First, we will make every effort to meet the demands of transporting medical materials. We will guide key logistics enterprises to strengthen coordination with medical supplies production, operation and distribution enterprises to ensure timely and full response to transportation needs for medical supplies. Second, we will strengthen the transportation organization and capacity scheduling. We will guide large key logistics and transportation enterprises to formulate support plans for transporting medical supplies during the Spring Festival holiday, and encourage front-line employees to continue to work during the holiday by arranging staff rotation and off-peak leave, and issuing subsidies, overtime pay and other measures, so as to ensure that the transportation of medical materials is not interrupted during the holiday. Third, we will make every effort to smooth the final delivery service network. We will give full play to the role of large key postal express enterprises, and guide them to improve their contingency plans during the holiday. We will strengthen regional labor deployment, and pay close attention to the staffing of employees in small and medium-sized cities and rural areas. With these efforts, we will ensure the uninterrupted transportation of medical supplies during the Spring Festival travel rush.
Transportation and logistics are linked to people's livelihoods and are related to the overall stability of growth, employment and prices. While ensuring transportation services for key medical supplies, we will also continue to ensure the smooth flow of the "main artery" and "microcirculation." We will coordinate the transportation of key materials like energy and grain, and daily necessities like vegetables, fruit, meat, poultry, eggs and milk this winter and spring, so as to better serve the overall situation of economic and social development and ensure people's living needs and a warm winter.
Here, I would again like to remind drivers that if they encounter any obstacles during transportation, or if relevant supply enterprises face difficulties in logistics and transportation, they are welcome to call the local or national hotlines. We will coordinate services to see that their difficulties are addressed.
_ueditor_page_break_tag_The Beijing News:
This year, some newly built railways will face the big test of the Spring Festival travel rush. What preparations have railway departments made? Can China's current railway capacity meet the demands of the Spring Festival travel rush this year? Thank you.
Huang Xin:
Thank you for your questions. This year's Spring Festival travel rush is the first after the central government optimized and adjusted the pandemic prevention policies, as pandemic prevention and control entered a new stage. Therefore, the population's travel demands may change significantly compared to previous years. The pre-sale of train tickets for the 2023 Spring Festival period started on Dec. 24, 2022. Looking at current ticket bookings, we have seen that travel demand in all aspects has increased significantly, and railway passenger flows are gradually recovering.
To properly ensure capacity for the Spring Festival travel rush, I mentioned earlier that we adhere to the principles of "adequate arrangement, on-demand activation, rapid response, and emergency preparedness," and the train operating plan has been arranged accordingly for the holiday travel rush. A daily maximum of 6,077 pairs of passenger trains will be put into operation during peak days before the holiday, with a seating capacity of 9.04 million passengers. Moreover, there will be a maximum of 6,107 pairs of trains per day after the holiday, with a seating capacity of 9.14 million people. Maximum seating capacity has increased by 11% compared with the same period in 2019, enabling us to better meet the travel demands of passengers during the Spring Festival travel rush. Regarding transportation capacity, we have prepared in three ways.
First, we will make good use of new lines, stations and equipment. Last year, 4,100 kilometers of new railway lines were put into operation nationwide, including 2,082 kilometers of high-speed railway. The accessibility and coverage of the railway network were further improved. During the Spring Festival travel rush, we will give full play to the advantages of our high-speed railway network. We will effectively use new lines and stations such as the Zhengzhou-Chongqing High-speed Railway, the Huzhou-Hangzhou High-speed Railway, the Yinchuan-Lanzhou High-speed Railway, the Beijing-Tangshan Intercity Railway, the new Chengdu-Kunming Railway, and Beijing Fengtai Railway Station, and advanced equipment such as the new Fuxing EMU trains. We will also make effective use of the 350-kilometer-per-hour speed achieved by the Beijing-Wuhan section of the Beijing-Guangzhou High-Speed Railway, enabling us to enhance efficiency and improve capacity for the Spring Festival travel rush.
Second, we will expand transportation capacity in key regions and times. Before the festival, 1,623.5 pairs of direct passenger trains will run daily in the areas with concentrated passenger flows, including Beijing, the Shanghai-Nanjing-Hangzhou region, and the Guangzhou-Shenzhen region, a year-on-year increase of 34.5 pairs. Meanwhile, 222 pairs of high-speed trains will run every night, a year-on-year increase of 25 pairs. After the holiday, 814.5 pairs of direct passenger trains will run daily in the cities of Chengdu, Chongqing, Wuhan and Nanchang, and Hunan province and other areas with concentrated passenger flows, a year-on-year increase of 18 pairs. Moreover, 135 pairs of high-speed trains will run each night, a year-on-year increase of 14 pairs. At the same time, we will maintain the necessary operation scale of normal-speed passenger trains, continue to run slow trains for public welfare, and ensure the travel needs of people in remote areas.
Third, we will establish an emergency response mechanism for unexpected passenger flows. We will analyze the patterns of passenger travel, study and assess the changing trend of passenger flows, adjust transport capacity at different stages, and achieve a good balance between transport capacity and demand according to pre-sale and waiting list data from ticket reservation website 12306.cn. According to current ticket bookings, before the festival, the transportation capacity are relatively short for those traveling from the Pearl River Delta and the Yangtze River Delta to the central and southwest regions. Therefore, we will adjust and supplement transportation capacity to meet the travel needs of passengers as much as possible. In order to cope with unexpected passenger flows, a certain number of EMUs and crew members will be on standby in major railway hubs for immediate deployment, ensuring we meet the travel demands of passengers. Thank you.
_ueditor_page_break_tag_Beijing Youth Daily:
Just now, the State Post Bureau discussed the slowdown in express delivery services and the backlog of parcels that occurred a while ago. The Spring Festival is the peak season for people to return to their hometowns and travel; it is also the offseason for the courier industry. Can you judge whether there will be a shortage of couriers and a slowdown in express delivery services in the next stage? Are there any solutions? Thank you.
Chen Kai:
Thank you for your questions. During the Spring Festival, as many people return to their hometowns to celebrate the Lunar New Year or travel, people's need for express delivery services will significantly decline. According to the data of the past two years, the average business volume per day in the seven days of Spring Festivals accounts for about 15% of the average daily business volume of whole year in 2021 and 2022. It can be said that the Spring Festival is the offseason for the courier industry. Despite that, we hold that currently, it is a critical period for the optimization of epidemic prevention and control, and people are still in urgent need of delivery of medicines and materials for epidemic prevention and control and basic living. Therefore, for some time to come, especially during the Spring Festival, ensuring delivery services is of great significance for better coordination between epidemic prevention and control and serving economic and social development in the new situation. Taking that into consideration, the State Post Bureau has specifically formulated the work plan for the postal and courier industry on safeguarding delivery services during the 2023 Spring Festival. It has made special arrangements concerning the operation of the industry during the Spring Festival, mainly including the following four aspects:
First, the order of postal delivery services will be maintained. We will effectively play the role of the market and urge postal enterprises to keep providing stable universal postal services. We will guide major brand express delivery enterprises to make reasonable service commitments tailored to the actual delivery needs of different regions, issue the arrangements of services during the Spring Festival in advance, coordinate the transport capacity of the entire network, and arrange a necessary number of outlets and workers to ensure the effective operation of the service network of their brands.
Second, the delivery service for the "Lunar New Year's Shopping Festival" will be guaranteed. This year we will continue to work with the Ministry of Commerce and other departments to organize the Online Lunar New Year's Shopping Festival activity. We will guide the enterprises to make reasonable arrangements for production and operation during the holiday, promptly release the service arrangements to the public, and strictly act upon its announcements and commitments. We will urge enterprises to strengthen communication with upstream e-commerce enterprises to make a well-informed prediction about changes in the needs for services during the Lunar New Year's Shopping Festival and the Spring Festival and make reasonable arrangements for human resources and transport capacity to ensure the enterprises' regular operation.
As I have mentioned, in the first five days of this year, the business volume of express delivery nationwide has reached 1.89 billion pieces, providing support for the online retail sales of physical goods of more than 160 billion yuan. It can be said that the coordination between commodity circulation and express delivery and logistics plays an active role in stabilizing consumption.
Third, the need for delivery of medical supplies, including medicines, will be guaranteed. Together with the Ministry of Commerce, we jointly issued the notice on jointly guaranteeing the supply and delivery of medical supplies, guiding for delivery enterprises to make special marks on medical supplies, strengthen guarantees and give priority to its delivery to meet people's urgent needs for the delivery of medicines and other medical supplies.
Fourth, practical measures will be taken to safeguard couriers' legitimate rights and interests. I believe you all remember that on Feb. 1, 2019, General Secretary Xi Jinping visited couriers at Shitou Hutong in Qianmen, Beijing. He said affectionately that couriers work really hard, getting up early and returning home late at night, making deliveries in all weathers, and getting even busier at holidays, and working the hardest just like busy bees to bring convenience to our life. We will fully implement the important instructions of General Secretary Xi Jinping and pay visits to couriers during the Spring Festival. We will urge delivery enterprises to coordinate the arrangement of rest and leave for those who work during the holiday and implement off-peak vacations or allow them to take their days off later. Couriers who work during the holiday should enjoy due overtime payments under the relevant laws, and subsidies to enterprises that maintain stable employee numbers will be ensured to guarantee their living.
Based on the current conditions, many enterprises have recently issued their operation plans during the Spring Festival, specifying the commitments of their brands to ensure services during the Spring Festival. We will further urge enterprises to fully implement their commitments and make serious efforts to ensure the quality of delivery services during the Spring Festival. Thank you.
_ueditor_page_break_tag_Xing Huina:
Due to time constraints, we will have one last question.
Nanfang Metropolis Daily:
As the huge human migration involving 2 billion trips approaches, how will China respond to the challenges after having optimized the epidemic control management during the Spring Festival travel rush? What specific measures will be taken? Thank you.
Cai Tuanjie:
Thank you to the reporter. The epidemic prevention and control work plays a crucial role in ensuring transportation services during this year's Spring Festival. During the Spring Festival travel rush, the high flow of people and goods and extensive social activities increases the risk of infection. Based on these conditions and combined with the implementation of the measures adopted by China to treat COVID-19 as a Category B disease, the Spring Festival Transportation Special Group has issued the Guidelines on Epidemic Prevention and Control During the Spring Festival Travel Rush and Guidelines on Travel Services During the Spring Festival Travel Rush. We will guide regions to strengthen whole-chain management according to relevant requirements and documents, urge employees in the transportation industry to carry out effective and detailed implementation of epidemic control measures and guide the public to take personal protection measures, contributing to the effective and steady transition of the epidemic development and ensuring the smooth and orderly operation of transportation services during the Spring Festival.
First, the organization and guidance of passenger flow will be enhanced. We will urge operators to strengthen disinfection and ventilation of airports and transportation hubs. Passenger flow will be organized in a better way. Passengers will be guided to form lines in key places including entrances, ticket windows, automatic ticket machines, security check lanes, and check-in gates. If conditions allow, passengers will be guided to maintain their distance in waiting rooms and sit apart from each other. Transport capacity will be increased in a timely manner for lines with large passenger flow to reduce gatherings.
Second, education programs will be conducted to raise public awareness of epidemic prevention when traveling. Everyone should be responsible for their own health. Here we would like to recommend that the public reduce travel to regions with high infection rates and people from these regions should also reduce travel and avoid traveling when they have symptoms. People should try not to take public transportation if they have not ruled out the risk of having been infected or when displaying symptoms such as fever. During their journey, passengers should increase their awareness of self-protection and strengthen personal protection throughout the entire trip. When taking public transportation, passengers should wear face masks during the entirety of their trip and try to reduce gathering.
Third, the adoption of contactless services will be encouraged. We will guide passenger transport operators to keep improving ticket services and take active steps to promote the application of services including online purchasing of tickets, e-tickets, and self-service check-in. The range of paperless and contactless services will be expanded. The smooth transition between railway, civil aviation and urban rail transit will be further advanced and the security check process will be optimized, so as to reduce the waiting time for transfers and public gathering and improve passengers' efficiency in transfer.
Fourth, the health management of transportation employees will be strengthened. We will urge operators to strengthen the health monitoring of transportation employees and carry out management of those with symptoms. Those who have symptoms such as fever should promptly report their situation, stop working and take a COVID-19 antigen test or nucleic acid test if necessary. Transportation employees are asked to strengthen self-protection. They should wear face masks during their work and practice good hand hygiene. Meanwhile, for service staff working in transportation hubs and highway service areas with large passenger flow and those working on the frontline in places such as toll booths, we advocate that they commute directly between their home and workplace. They should also wear N95 or KN95 face masks during their work.
Fifth, epidemic prevention and control measures will be strictly implemented in airports and transportation hubs. We will urge operators to strengthen the daily public hygiene management in relevant airports and transportation hubs, highway service areas, toll booths, and some transportation vehicles. All of these public facilities will go through thorough cleaning and disinfection and ensure good ventilation. In areas where the epidemic situation is serious, the frequency of cleaning, disinfection and ventilation will be increased, and the windows of passenger vehicles will be opened regularly for ventilation.
Sixth, effective measures will be taken to respond to large-scale infections of transportation employees. We will urge operators to strengthen the management of transportation employees in terms of epidemic control. Drivers will undergo strict and prudential examinations before going to work to ensure that their physical conditions meet the standards for safe driving. Mechanisms for staff rotation and backups in key positions and for cross-regional mobilization of personnel and transport capacity will be established and implemented. We will make preparations in case of the need to respond to large-scale infections of transportation employees, so as to ensure that the replacement of personnel is carried out in an orderly manner and that transportation services are not disrupted.
We would also like to appeal to all regions to provide care for transportation employees. Highway service areas and service centers for drivers should if possible set up medical service stations, prepare necessary materials for epidemic treatment such as anti-fever drugs and provide necessary places for drivers to rest, so as to ensure that transportation employees can receive timely medical treatment and get the necessary rest when they have symptoms.
Next, we will pay close attention to developments in the epidemic nationwide, make timely adjustments to the relevant policies and supporting measures as circumstances change, and guide regions to take well-coordinated steps to prevent and control the epidemic and provide services for the Spring Festival travel rush. Thank you.
Xing Huina:
Today's briefing is hereby concluded. Any news organization that did not get a chance to raise questions today may contact us after the briefing. Thank you to all the speakers and friends from the media. Goodbye.
Translated and edited by Wang Yiming, Zhang Rui, Xu Xiaoxuan, Li Huiru, Yan Bin, Wang Wei, Yang Xi, Liu Qiang, Cui Can, Zhang Junmian, Duan Yaying, Huang Shan, Xiang Bin, Liu Sitong, Ma Yujia, Xu Kailin, Wang Qian, Zhu Bochen, Zhang Jiaqi, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Ms. Cao Shumin, vice minister of the Cyberspace Administration of China (CAC)
Ms. Qi Xiaoxia, director general of the International Cooperation Bureau of the CAC
Mr. Yang Shuzhen, director general of the Policy Research Bureau of the CAC
Ms. Sun Weimin, director general of the Cybersecurity Coordination Bureau of the CAC
Mr. Wang Song, director general of the Informatization Development Bureau of the CAC
Mr. Chen Renze, an official of the Cyber Communication Bureau of the CAC
Chairperson:
Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
Nov. 7, 2022
Xing Huina:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO published a white paper titled "Jointly Build a Community with a Shared Future in Cyberspace," and organized this press conference to introduce and interpret its main content.
The white paper fully implements Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly puts into practice the guiding principles from the 20th National Congress of the Communist Party of China (CPC), and provides a comprehensive picture of the achievements in the development and management of the internet in China since the 18th CPC National Congress. The document elaborates on China's concepts, actions and contributions in strengthening international communication and cooperation in cyberspace and promoting the building of a community with a shared future in cyberspace. It also puts forward China's proposals on creating a community with a shared future in cyberspace.
At around 24,000 Chinese characters, the white paper consists of preface, main body and conclusion. The main body is divided into four parts: "Building a Community with a Shared Future in Cyberspace Is Essential in the Information Age," "Development and Management of the Internet in China," "China's Contribution to Building a Community with a Shared Future in Cyberspace" and "China's Proposals on Creating a Community with a Shared Future in Cyberspace."
The white paper is published in eight languages — Chinese, English, French, Russian, German, Spanish, Arabic and Japanese — by the People's Publishing House and Foreign Languages Press. It is available at Xinhua Bookstore outlets across the country.
To help you better understand the white paper, we have invited Ms. Cao Shumin, vice minister of the Cyberspace Administration of China (CAC); Ms. Qi Xiaoxia, director general of the International Cooperation Bureau of the CAC; Mr. Yang Shuzhen, director general of the Policy Research Bureau of the CAC; Ms. Sun Weimin, director general of the Cybersecurity Coordination Bureau of the CAC; Mr. Wang Song, director general of the Informatization Development Bureau of the CAC; and Mr. Chen Renze, an official of the Cyber Communication Bureau of the CAC. They will brief you on relevant information and then take your questions.
Now, I'll give the floor to Ms. Cao Shumin.
_ueditor_page_break_tag_Cao Shumin:
Thank you, Ms. Xing. Ladies and gentlemen, friends from the media, good morning. It is my pleasure to brief you on the white paper "Jointly Build a Community with a Shared Future in Cyberspace."
Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has proactively conformed to the development trends of the information revolution, attached great importance to the internet, and engaged in development and governance of the internet. It has promoted coordinated progress in the development of cybersecurity and information technology (IT) and contributed to the historic achievements and changes in the sectors in China. In December 2015 during the second World Internet Conference (WIC), General Secretary Xi Jinping proposed the building of "a community with a shared future in cyberspace." The proposal expressed China's sincere wish to cooperate with the rest of the world in promoting the development of management of the internet. It also offered Chinese solutions and contributed Chinese wisdom to the sector.
Next, I will brief you on the main content of the white paper from four aspects.
First, building a community with a shared future in cyberspace is essential in the information age.
The world is currently undergoing accelerating changes unseen in a century. The new scientific and technological revolution and industrial transformation are gaining momentum. Problems with the internet such as unbalanced development, unsound regulation and unreasonable order are becoming more prominent, and cyber-hegemonism poses a new threat to world peace and development. Cyberspace governance requires more just, reasonable and effective solutions, and global threats and challenges necessitate joint efforts from around the world.
General Secretary Xi Jinping's important concept of building a community with a shared future in cyberspace has elaborated on a series of major principles and proposals for global internet development and governance. It comprises four principles: respecting cyber sovereignty, safeguarding peace and security, promoting openness and cooperation, and maintaining good order. It also noted that we should hold to a vision of extensive consultation, joint contribution and shared benefits in global governance; we should contribute to building a peaceful, secure, open, cooperative and orderly cyberspace; and we should build cyberspace into a community of common development and shared security, responsibility and interests.
The second aspect is the development and management of the internet in China.
The development and management of the internet in China has provided strong support for the nation's high-quality growth. This is summarized in the white paper from seven aspects.
First, the digital economy is thriving. By 2021, the value of the digital economy had reached 45.5 trillion yuan, accounting for 39.8% of GDP, and has become a major engine of growth for the nation's economy. Second, digital technologies have brought benefits and convenience to the people. China has proactively promoted internet application in public service sectors such as education and medical services, and fully leveraged the key role of the internet in promoting poverty alleviation and rural revitalization. Third, the legal framework for cyberspace continues to improve. China has established a complete cyber law system and enforced a number of laws such as the Cybersecurity Law, Data Security Law and Personal Information Protection Law. This has boosted the sound development of the internet within the bounds of the law. Fourth, China has developed rich and varied online content. Positive and mainstream ideas and opinions are spreading online. Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era has taken root in the hearts of the people, and the core socialist values are guiding the cultural development online. Fifth, the cyberspace is getting cleaner. We have launched Operation "Qinglang," promoted internet civilization and pooled positive energy. As a result, China's cyber ecosystem continues to improve. Sixth, the operation of online platforms continues to become more standardized. We have worked to improve the institutional arrangements and mechanisms which help enterprises to develop and regulate their operation. We are also stepping up regulation related to new technologies and applications, advancing the self-discipline of industry, and working to promote fair competition and orderly development on social media platforms. Seventh, China has effectively guaranteed cybersecurity. China has strengthened top-level design on cybersecurity and intensified efforts to protect critical information infrastructure. China has also enhanced its ability to ensure digital security, strengthened personal information protection and strived to crack down on cybercrimes.
The third aspect is China's contribution to building a community with a shared future in cyberspace.
Over the years, China has continued to strengthen dialogue and cooperation in cyberspace. The white paper elaborated on this topic from four aspects.
Regarding cooperation on the digital economy, China has been working to promote the construction of information infrastructure. China proactively participates in cooperation on the digital economy under multilateral frameworks such as the Group of 20 (G20), Asia-Pacific Economic Cooperation (APEC) and BRICS, and contributes to the development of the digital economy globally. Regarding cybersecurity cooperation, China has been working with the international community to increase cooperation in data security and personal information protection and jointly combat cybercrime and cyberterrorism. The National Computer Network Emergency Response Technical Team (CNCERT) has established partnerships with 274 computer emergency response teams (CERTs) from 81 countries and regions. Regarding the governance of cyberspace, China has proactively carried out bilateral and multilateral dialogue and cooperation in cyberspace, and worked to promote the reform and development of the global internet governance system. Global exchange platforms such as the WIC Wuzhen Summit have been developed, and the WIC was established as an international organization in July this year. Here, I would also like to announce that the 2022 WIC Wuzhen Summit will officially kick off on Nov. 9. We look forward to your participation and hope you follow its updates. Regarding promoting inclusive global development, China has been proactively carrying out international cooperation in poverty alleviation through internet access, promoting online cultural exchange and mutual learning among civilizations, and working to provide benefits to people around the world with the achievements in internet development.
At last, about China's vision of the future development of the internet. The white paper illustrated China's proposal to create a closer community with a shared future in cyberspace regarding cyberspace development, governance, security and cooperation.
The 20th CPC National Congress has pointed out the direction for building strength in cyberspace, digital technologies, and international cooperation. Guided by the concept of building a community with a shared future in cyberspace, China will cooperate with the international community to promote the development of an open, inclusive, and vibrant cyberspace that is fairer, more rational, and secure and stable, to ensure that the internet will bring more benefits to people of all countries.
Next, my colleagues and I are very willing to answer your questions.
_ueditor_page_break_tag_Xing Huina:
Okay, now you can ask questions. Please identify the media outlet you represent before raising a question.
CCTV:
As mentioned in the white paper just now, China has been deepening international exchanges and cooperation in cyberspace in recent years, contributing to the building of a community with a shared future in cyberspace. What are the features of international exchanges and cooperation in cyberspace in the new era?
Cao Shumin:
Thanks for your question. I will take this question. When introducing the main contents of the white paper just now, I mentioned that in recent years, China has followed the guidance of the concept of building a community with a shared future in cyberspace and carried out international exchanges and cooperation concerning cyberspace, continuously achieving positive outcomes. To sum up, the international exchanges and cooperation have several features as follows.
First, we have been committed to a people-centered approach. China is the world's largest developing country and the country with the largest number of internet users at 1.05 billion. We have upheld the people-centered development philosophy and worked to promote the development of the internet. We have tried to align its development with the laws of development in the information age and ensure its development more live up to the needs and expectations of the people to make the internet more beneficial to people throughout the world.
Second, we have been committed to openness and cooperation. General Secretary Xi Jinping has stressed that openness is a major driving force for the progress of human civilization and is essential for the development and prosperity of the world. In recent years, we have been committed to openness and cooperation, upheld multilateralism, and actively built bilateral, regional, and international platforms for collaboration. We have promoted pragmatic cooperation with many countries in cybersecurity and IT to the shared expectation of the international community for deepening dialogue and cooperation in this field.
Third, we have been committed to mutual benefit and win-win outcomes. We have been practicing the idea of mutual benefit and win-win outcomes, opposing a zero-sum game and striving to make sure the achievements of internet development and governance are shared by all countries. The outcomes of exchanges and cooperation in cyberspace between China and other countries have been achieved in a host of pragmatic cooperation projects such as bridging the digital divide, facilitating the growth of the digital economy, and promoting poverty reduction, which has enhanced people-to-people connectivity and common development.
Fourth, we have been committed to equality. It has been China's consistent view that all countries, big or small, strong or weak, rich or poor, are entitled to equal participation in developing a global order and international rules. The future development of cyberspace should be decided by people of all countries, who should work together to create an international environment conducive to development and foster new drivers for global growth. We firmly oppose acts of bullying, the erection of walls and barriers, and any attempts to decouple and disrupt industrial and supply chains. We reject unilateralism and maximum-pressure tactics. We uphold mutual respect, seek common ground while setting aside differences, and advocate the idea that international affairs should be discussed by all involved.
Fifth, we have been committed to maintaining peace and security. We oppose the so-called absolute security for some at the expense of the interests of others and any form of arms race in cyberspace. We support jointly fighting cybercrime and cyberterrorism, oppose network eavesdropping and cyberattacks, and strengthen international cooperation on personal information protection. We have actively carried out dialogue and cooperation in cybersecurity in order to reject the Cold War mentality, uphold peace through collaboration and seek our own security through common security.
Six, we have been committed to promoting fairness and justice. Cyberspace is globally interconnected, so no country can effectively govern it alone. We have been committed to promoting governments, international organizations, enterprises, and think tanks to work together to improve dialogue and consultation mechanisms in cyberspace so that the global internet governance system can become fairer and more rational and reflect the aspirations and interests of the majority of countries in a more balanced way. Thank you.
_ueditor_page_break_tag_Phoenix Satellite Television:
At the end of April this year, the U.S. government launched the Declaration for the Future of the Internet. Today, the Chinese government issued the white paper titled "Jointly Build a Community of Shared Future in Cyberspace." What's the relationship between the proposal of the Chinese government and the declaration by the U.S. government? What are the differences? Thank you.
Cao Shuming:
Thank you for your question. This question has attracted much attention from the public. Ms. Qi Xiaoxia, director general of the International Cooperation Bureau of the Cyberspace Administration of China, will answer this question.
Qi Xiaoxia:
I'm happy to answer the reporter's question from Phoenix Satellite Television. It should be said that the white paper is fundamentally different from the so-called Declaration for the Future of the Internet. As you mentioned, a certain country launched the so-called "Declaration for the Future of the Internet" in April, trying to impose its own standards on others, drawing ideological lines in cyberspace, forming an exclusive clique to instigate division and confrontation, and violating international rules. These acts have seriously broken the solidarity of the big family of the internet and severely affected the stable development of the global internet.
As you can see, the white paper put forward "China's proposals on creating an even stronger community with a shared future in cyberspace." What we advocate is openness, cooperation, inclusiveness, and mutual learning, and what we uphold is that cyberspace is the shared home of all of humanity and the future of cyberspace should be decided by all countries in the world, rather than by one single country or several countries.
In international cyberspace governance, we champion leveraging the role of the United Nations as the main channel. We also advocate that the international community should commit itself to extensive consultation, joint construction and shared benefits, strengthen cooperation, and jointly formulate international rules in cyberspace.
We are willing to deepen cooperation with other countries in the world, jointly promote the reform and development of the global internet governance system, and work together to build a stronger community with a shared future in cyberspace. Thank you!
_ueditor_page_break_tag_Tianmu News:
I noticed a paragraph on page 27 in the white paper that says, "China actively facilitates the digital industry and industry digitalization and calls for joint efforts to coordinate the transformation towards digitalization and green growth." Please share with us China's specific considerations in this regard. Thank you.
Cao Shumin:
Thank you for your question. Mr. Wang Song will answer it.
Wang Song:
Thank you for your interest in digitalization and green growth. The report to the 20th CPC National Congress proposed "moving faster to boost China's strength in cyberspace and digital development" and called for "accelerating the transition to a model of green development, boosting green and low-carbon industries, and promoting green and low-carbon ways of production and life."
At present, digitalization and green growth are not only important themes for global development but also twins that are interdependent and mutually reinforcing. For one thing, the energy consumption of the digital industry is growing rapidly. For example, the total power consumption of data centers in China currently accounts for about 1.5% of the country's total, posing an urgent need for green transformation and development. For another thing, digital technology has played an increasingly prominent role in driving the green transition of traditional industries. It is predicted that by 2030, various industries can cut 12.1 billion tons of carbon emissions by dint of digital technology.
In recent years, China has organized and implemented the action plan on coordinated transformation towards digitalization and green growth, whose main tasks include three respects. The first is to promote the green and low-carbon development of the digital industry. The second is to accelerate the green transformation of traditional industries enabled by digital technology. The third is to leverage the role of green transition of industries in driving the digital industry. Eighteen key actions have been deployed centering on the tasks in the above-mentioned three respects.
With the joint efforts of various departments and regions, preliminary progress has been made to coordinate transformation towards digitalization and green growth. For example, the current energy consumption per 5G base station has declined by more than 20% compared with that for initial commercial use in 2019, and the average power usage efficiency (PUE) of planned data centers above large scale nationwide has dropped below 1.3. Large domestic digital technology companies have responded to calls nationwide and have taken the lead in formulating low-carbon development plans.
Next, we will further promote the action plan on coordinated transformation towards digitalization and green growth and focus on the following three tasks. The first is to organize and conduct comprehensive pilot programs in this regard and encourage regions with suitable conditions to carry out pilot trials. The second is to promote typical cases and experiences of digital technology enterprises in coordinating transformation towards digitalization and green growth and let these enterprises play an exemplary role. The third is to strengthen relevant international cooperation and promote the expansion of exchanges and sharing of experience under bilateral and multilateral cooperation mechanisms. Thank you.
_ueditor_page_break_tag_The Paper:
Since the 18th CPC National Congress, General Secretary Xi Jinping has put forward the concept of building a community with a shared future in cyberspace. Could you talk about your understanding and perception of the concept? Thank you.
Cao Shumin:
Thanks for your question. The concept of building a community with a shared future in cyberspace proposed by General Secretary Xi Jinping is rich in content. I'd like to invite Mr. Yang Shuzhen to answer this question.
Yang Shuzhen:
The question you raised is very important, and I'm happy to take it.
At the second World Internet Conference held in December 2015, President Xi Jinping delivered a keynote speech, and for the first time, clearly put forward the concept of "building a community with a shared future in cyberspace." Since then, he has made in-depth interpretations of the concept on many occasions. This continuously enriched concept has an increasingly bigger influence, which has become a consensus of the international community. By studying and comprehending, I feel that this important concept can be summed up in "four sentences":
First, it is an important thought that keeps up with the changing world. The world is currently undergoing profound changes unseen in a century. On the one hand, the historical trends of peace, development, cooperation, and mutual benefit are unstoppable. On the other hand, as hegemonic, high-handed, and bullying acts have caused serious harm to the world, the international community is facing unprecedented challenges, and the world is once again reaching a crossroads in history. General Secretary Xi Jinping, with insight into the changes in the world, the times, and the history, has clearly put forward the major concept and proposition of building a human community with a shared future. Building a community with a shared future in cyberspace is an important part of building a human community with a shared future and an important part of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, especially the important thought of the general secretary on boosting China's strength in cyberspace. It provides a guideline for the international community to cope with the changes and new challenges and jointly build a community with a shared future in cyberspace.
Second, it is a strategic goal that responds to the call of the times. At present, the new round of technological revolution represented by IT is changing with each passing day. The internet has turned the world into a "global village," and the international community has increasingly become a community with a shared future where our interests are closely intertwined. With a view of the changes in the information era, General Secretary Xi Jinping clearly put forward the strategic goals of building a community with a shared future in cyberspace where we can jointly advance development, safeguard security, participate in governance, and share the benefits. He called on efforts to build the cyberspace into a community with shared development, security, responsibilities, and interests that benefits all humanity, specifying the strategic goals for building a community with a shared future in cyberspace.
Third, it is the basic principle of solving practical problems. The internet has vigorously promoted the progress of human civilization, but it has also brought a series of new threats and challenges to the sovereignty, security, and development interests of all countries. Cyberspace hegemonism and power politics are emerging. Protectionism and unilateralism are on the rise. Cyber attacks and cyber crimes are becoming severe. Adopting a problem-oriented and systematic approach, General Secretary Xi Jinping clearly put forward "four principles" to promote the reform of the global internet governance system, namely, respecting cyber sovereignty, safeguarding peace and security, promoting openness and cooperation, and building good order, which points out the direction and principles for building a community with a shared future in cyberspace.
Fourth, it is China's proposal to enhance global well-being. The internet is a home shared by all mankind, and the future of cyberspace should be jointly created by all countries in the world. With a view on improving the well-being of all mankind, General Secretary Xi Jinping clearly put forward a "five-point proposal" of building a community with a shared future in cyberspace, namely, speeding up the building of global internet infrastructure and promoting inter-connectivity; building an online platform for cultural exchange and mutual learning; promoting innovative development of the internet economy for common prosperity; maintaining cyber security and promoting orderly development; and building an internet governance system to promote equity and justice. The proposal provides us with a practical path for building a community with a shared future in cyberspace and will surely promote the development of the internet to better benefit the people in China and the rest of the world. Thank you!
_ueditor_page_break_tag_Bloomberg News:
I was wondering, has China finished what it set out to do with the overhaul and rectification of the internet and online platforms? Or is there still more work to be done? Thank you.
Wang Song:
Thank you for your interest in internet platform companies. It is our important responsibility to encourage and support the healthy and sustainable development of internet platform companies. We carry out daily supervision of the behavior of internet platform companies in accordance with laws and regulations. If there is a prominent disorder on the internet, we will also carry out a "Clear and Bright" special campaign to deal with that. For internet platform companies, we generally follow the principle of promoting development and regulating their behaviors at the same time, guiding them with policies and managing them in accordance with the law, and pursuing social benefits and economic returns at the same time, thus creating a favorable environment for the development of internet platform companies. Thank you.
_ueditor_page_break_tag_Southern Metropolis Daily:
The white paper mentions that China's internet development and governance practices have made positive contributions to building a community with a shared future in cyberspace and the country has put forward its proposals. Is China promoting a model of internet development and governance by issuing this white paper, "Jointly Build a Community with a Shared Future in Cyberspace"? Thank you.
Cao Shumin:
Thank you for your question. I'll answer it.
Different countries have different national conditions, different political systems, and different cultural backgrounds. We believe that all countries have the right to choose the internet development path that fits their own needs. At the same time, we also notice that people all over the world have the same desire to benefit from the digital age and they all expect to share the benefits of the internet for a better life. This is precisely what governments, international organizations, internet enterprises, technical communities, non-governmental organizations, and individual citizens should strive for.
China has explored experience for building a community with a shared future in cyberspace with its internet development and governance practices, and contributed its wisdom and solutions in this regard. All countries, with various forms of civilization, should and must be able to find their own path for internet development and governance. As a Chinese saying goes, we need to appreciate the beauty of each civilization and show respect for the diversity of civilizations in the world. We strongly support diversified exploration and practice, rather than imposing our own model on others. China is committed to respecting the sovereignty in cyberspace and respecting the rights of all countries to independently choose their own path of cyber development, model of cyber regulation, internet public policies, and their right to equal participation in global cyberspace governance.
That's all for your question. Thank you.
_ueditor_page_break_tag_Kyodo News:
I have two questions. The first one is: In the report to the 20th CPC National Congress, General Secretary Xi Jinping emphasized that China will move faster to boost China's strength in cyberspace. So what will China do in the next five years? And what measures will be taken? My second question is: As China continues to strengthen cyber security in recent years, some foreign companies have expressed worries about restrictions on their work in China. What is China's response to such concerns? Thank you.
Cao Shumin:
Thank you for your questions. You asked two questions. The first one is about building China's strength in cyberspace. We invite Mr. Yang Shuzhen to answer it, and Ms. Qi Xiaoxia will take the second.
Yang Shuzhen:
The 20th CPC National Congress has drawn a blueprint for the future development of the Party and the country. Particularly, based on the development trends of the information age, it has put forward a series of new tasks, new arrangements, and new requirements for boosting China's strength in cyberspace. We must fully implement the guiding principles of the 20th CPC National Congress, follow General Secretary Xi Jinping's requirements of "developing strong technology, content, and talent pool, building a solid base, and having a better say in related international affairs," and make efforts to build China's strength in cyberspace, so as to provide strong services, support, and guarantees for building a modern socialist country in all respects. Specifically, our future work will include the following seven aspects.
First, we will better develop online content to shape a new pattern of public opinion. We will give full play to the communication advantage of the internet, promote the construction of omnimedia communication system, uphold fundamental principles and break new ground in the publicity work concerning major online topics, strive to create high-quality, uplifting content, and comprehensively improve the accuracy, effectiveness, and attractiveness of international communication online, so as to steadily amplify mainstream online public opinion and the voice of China.
Second, we will promote the formation of a sound cyber ecosystem by improving the comprehensive internet governance system. On the basis of the governance system to be completed by this year, we will strive to build a scientific, efficient, and orderly internet governance pattern, promote cultural-ethical advancement on the internet, advance legislation, administration of justice, law enforcement, and law popularization with regard to the internet. We will intensify efforts to strengthen governance at the source of the cyber ecosystem, enhance governance in a systematic and law-based manner, and press ahead with "Operation Qinglang" so as to build a cleaner cyberspace.
Third, we will accelerate the construction of "digital China" to help realize Chinese modernization. We will give full play to the leading role of the overall layout of "digital China," accelerate the development of new-generation information infrastructure, promote the integrated development of the digital economy and the real economy, build internationally competitive digital industrial clusters, and accelerate the development of a digital government, a digital society, and a digital countryside. We will carry out the action plan for coordinated transformation and development of digitalization and greening and the action plan for enhancing digital literacy and skills of the entire population to promote new development with new growth drivers.
Fourth, we will focus on making breakthroughs in core technologies in the information sector to achieve greater self-reliance and strength in cutting-edge technologies. We will give full play to the new system for mobilizing resources nationwide and the leading role of major projects, accelerate original and pioneering sci-tech breakthroughs, strengthen basic research, improve incentive mechanisms, and facilitate the formation of an innovation ecosystem and the independent capacity of industries.
Fifth, we will maintain cybersecurity and data security to promote the modernization of the national security system and capabilities. We will comprehensively strengthen supporting systems and capacity building to ensure cybersecurity and data security, enhance security and protection of critical information infrastructure, strengthen the protection of personal information and important data, and effectively safeguard national cybersecurity and the vital interests of the people.
Sixth, we will strive to build a community with a shared future in cyberspace to promote the building of a community with a shared future for mankind. We will conduct in-depth exchanges and cooperation in cyberspace and actively participate in cyberspace governance in a bid to deliver more tangible benefits brought by the development of the internet to people all over the world.
Seventh, we will step up efforts to cultivate a team of internationally competitive professionals in cybersecurity and IT to advance the country's workforce development strategy. We will innovate the mechanism for cultivating talents in this realm to produce more science strategists, first-class scientists and innovation teams, young scientists, and outstanding engineers. We will also build a new type of think tanks and cultivate a strong team of officials to provide strong intellectual and personnel support to build up the country's strength in such fields. Thank you.
Qi Xiaoxia:
I will answer the second question raised by the reporter from Kyodo News. This question is about foreign companies' concerns about restrictions on operating in China. My answer is clear: such concern is absolutely unnecessary. As the 20th National Congress of the Communist Party of China has underscored, China remains committed to the fundamental national policy of opening to the outside world. You may have noticed that, in his speech at the opening ceremony of the fifth China International Import Expo on Nov. 4, President Xi Jinping pointed out that China "will work with all countries and all parties to share the opportunities in its vast market," "will work with all countries and all parties to share the opportunities from its institutional opening up," and "will work with all countries and all parties to share the opportunities from deepened international cooperation." We can see from this that China's door to the world will only open wider and wider.
According to data from Chinese competent authorities, more than a million foreign companies were registered in China, of which Japanese-funded enterprises account for a large proportion. This shows that foreign companies are very confident in China's business environment. The Chinese government has always been committed to fostering a market-oriented, law-based, and internationalized business environment, encouraging enterprises to operate and develop in accordance with laws and regulations and treating Chinese and foreign-funded enterprises as equals. Thanks.
_ueditor_page_break_tag_Beijing Youth Daily:
My questions are about international communications. The report to the 20th CPC National Congress says we will strengthen our international communications capabilities and make our communications more effective. What progress has been made in international communications in cyberspace? What steps will be taken to tell China's stories well and contribute to building a community with a shared future in cyberspace? Thank you.
Cao Shumin:
Thank you for your questions. To present a credible, appealing and respectable China is a long-term objective of strengthening international communications capabilities. Let's invite Mr. Chen Renze to answer the questions.
Chen Renze:
Thanks to the journalist with Beijing Youth Daily. Since the 18th CPC National Congress, General Secretary Xi Jinping personally planned, deployed, and promoted work on international communications and elaborated on a series of major theoretical and practical questions on strengthening international communications capabilities, pointing out a clear direction and offering fundamental guidelines for us. In accordance with General Secretary Xi Jinping's important instructions and the decisions of the CPC Central Committee, we have worked with local authorities and other departments to make innovations on the basis of what has worked in the past and extend the reach and influence of international communications in cyberspace. Positive progress has been achieved in this regard.
First, giving theoretical guidance and fully demonstrating the essence of the Chinese path. Focusing on major events and occasions, we leveraged the advantages of internet-based communication, innovated discourse, and strengthened presentation across all forms of media and interactive communication to interpret Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era from multi-dimensional perspectives. This was done to help more foreign audiences understand the power of truth and the global significance of the latest achievement of adapting Marxism to the Chinese context and the needs of our times.
Second, actively showcasing our image and enhancing the appeal of Chinese governance philosophy. We organized international internet communication activities such as "A Date with China" and "DaKa China" on major themes, including the 20th CPC National Congress, the Party's centenary, and the Beijing Winter Olympics. These activities showcased China's image as a country of diversity that is marching forward and gave the international community a hands-on experience on the three fundamental questions of why the CPC works in China, why the Marxism works in China and why the socialism with Chinese characteristics works in China.
Third, creating a positive impression and promoting the defining symbols of Chinese culture. By using modern, human-interest, international, and vibrant means of online communications, we promoted fine culture featuring Chinese characteristics, highlighting China's ethos, and embodying Chinese wisdom. These were delivered a group of online works which demonstrate Chinese aesthetics, modern concepts, and the shared values of humanity to better present Chinese culture to the world.
Fourth, increasing cohesion and encouraging more people to tell China's stories. With the internet as the medium, we built platforms for understanding China through programs such as "Why Red Star Shines in China" and "I am in China in the New Era." More and more foreign political leaders, experts, journalists, and overseas Chinese shared their interactions and friendship with China online, telling China's stories and promoting Chinese culture. China's image as a country that is credible, appealing and respectable has become more vivid and multi-dimensional.
For the next step, we will focus on the important arrangements made in the report to the 20th CPC National Congress, prioritize studying, publicize and implement the guiding principles of the congress, follow the laws of international communications in cyberspace, develop a global perspective, keep in mind key tasks, build our ability, comprehensively improve the capacities, level and effectiveness of international communications in cyberspace, and better tell stories of China and the CPC to make China's voice heard by more people and present a true, multi-dimensional, and panoramic view of China. Thanks.
_ueditor_page_break_tag_CRNTT:
What measures have been adopted in China to safeguard cybersecurity? Are there any practices or experiences in this regard that you'd like to share with other countries? Thank you.
Cao Shumin:
Thank you for your questions. Cybersecurity is an issue of great concern to everyone. Sustainable development is impossible without cybersecurity. I'd like to invite Ms. Sun to answer this question.
Sun Weimin:
Thank you for your questions and your concern about issues related to cybersecurity.
Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to cybersecurity and made a series of important instructions, charting the course and providing fundamental guidelines for the work on cybersecurity. In recent years, local authorities and government departments across the country have thoroughly studied and implemented General Secretary Xi Jinping's important thoughts on building China's strength in cyberspace. Remarkable progress has been made in its efforts to ensure cybersecurity, which can be seen in the following five aspects:
First, a policy and legal framework for cybersecurity have taken shape. A number of laws and policies have been formulated and put in place, including the Cybersecurity Law, Data Security Law, Personal Information Protection Law, Cybersecurity Review Measures, and Security Assessment Methods for Cloud Computing Services. Moreover, over 300 national standards for related realms have been issued. These laws and policies, therefore, have served as pillars of the legal and policy framework for cybersecurity.
Second, the working system for cybersecurity has been steadily improving across the country. We issued the emergency response plan for internet security incidents, establishing and improving a national working system for cybersecurity emergency response coordination and notification so as to carry out supervision and early warning in a timely manner. In this way, we have established a coordinated working system nationwide.
Third, the protection system for critical information infrastructure has witnessed remarkable progress, with its capabilities continuing to improve. We have promulgated laws and regulations, such as the Regulations on the Security and Protection of Critical Information Infrastructure, to provide a solid legal foundation for the security and protection system of critical information infrastructure. Thanks to the coordination of the Office of the Central Cyberspace Affairs Commission and the joint effort of other government departments, the protection of the critical information infrastructure is steadily improving.
Fourth, education, technologies and industries concerning cybersecurity have witnessed integrated development. We have established the first-level discipline of cyberspace security, and launched a demonstration project for the construction of first-class schools and colleges of cyber science. At present, more than 60 universities in China have set up schools and colleges of cyber science, with over 20,000 graduates majoring in cybersecurity every year. The country has set up the national cybersecurity talent and innovation base and is building five national-level pilot areas for integrated development of education, technology, and industry in the field of cybersecurity.
Fifth, the understanding of "a secure cyberspace environment serves and relies on the people" has been growing in popularity. We have held China Cybersecurity Week – an activity to raise people's awareness of cybersecurity – annually for nine years, disseminating cybersecurity information in a regular manner. We have launched special campaigns against the underground industry and cybercrimes like hidden cameras, the sale of personal information, infringing on people's private information, as well as telecom and online fraud.
The spirit of the 20th CPC National Congress is being studied and implemented throughout the country. The 20th CPC National Congress has charted the course for the future development of China's cybersecurity and IT undertaking, injecting strong impetus into international cooperation in this field. We will work together with all countries and jointly build a community with a shared future in cyberspace. Thank you.
_ueditor_page_break_tag_Red Star News:
The white paper, in several places, notes that Chinese enterprises have made a great effort to tap into oversea markets in terms of information infrastructure construction and e-commerce development. They have made great contributions to global internet development. However, some Chinese enterprises, such as Huawei, have come across restrictions in some countries. What's your comment on this? Thank you.
Cao Shumin:
Thank you for your question. The rapid development of cyberspace and IT across the world is largely due to globalization. However, it is true that some anti-globalization trends are on the rise. I'd like to invite Ms. Qi Xiaoxia to answer this question.
Qi Xiaoxia:
This is a question of public concern and also a question that we should pay attention to. As China's internet industry grows rapidly, Chinese enterprises have engaged in the international market, conducted international cooperation on research and development, and provided a great number of safe, reliable, and quality products and services at a reasonable price, enjoying great popularity worldwide. They have taken an active role in fulfilling social responsibilities, creating plenty of job opportunities for the countries and regions where they are based. Due to a lack of space, the white paper only gives a few examples.
Some Chinese companies, like Huawei, encountered difficulties in pursuing overseas business development. The reasons behind it are clear. Certain countries wantonly imposed export controls on China under the pretext of "national security" and deliberately blocked and suppressed Chinese companies, which infringed upon their legitimate rights and interests and severely disrupted the stability of global industrial and supply chains.
The white paper made it clear that the Chinese government opposes the politicization of technical issues and the containment of other countries' enterprises by abusing state power and violating market principles and trading rules.
We can see that under the current situation, global economic recovery faces multiple challenges and risks. What the international community urgently needs is unity, not division. We should tide over difficulties together instead of provoking confrontation. That is, those who call for decoupling, sever supply chains, and stoke division and confrontation, will only hurt themselves and other countries. Win-win cooperation is the only right path. Thank you.
_ueditor_page_break_tag_CNR:
The white paper says that the international organization of the World Internet Conference was inaugurated in Beijing in July 2022. You just mentioned that the World Internet Conference Wuzhen Summit would be held soon. What are the Chinese government's expectations for the future development of the international organization of the World Internet Conference?
Cao Shumin:
Thank you for your question. I will answer your question. The World Internet Conference has been held eight times. Based on the Wuzhen Summit, the international organization of the World Internet Conference was inaugurated this July. At the inaugural ceremony of the organization, Chinese President Xi Jinping sent a congratulatory letter, pointing out that the establishment of the organization is an important move echoing the informatization trend of the times, and it will deepen international exchanges and cooperation in cyberspace. He called for efforts to develop the World Internet Conference in line with forward-looking plans and high standards, to promote joint consultation through dialogues and exchanges, and to ensure benefits are shared by all through practical cooperation so as to contribute wisdom and strength to the global internet development and governance. The World Internet Conference is an open platform, and China stands ready to work with the international community to promote the development of the international organization.
We have the following expectations for the future development of the international organization of the World Internet Conference.
First, in terms of enhancing consensus, we will focus on the new challenges and problems faced by cyberspace, uphold openness and inclusiveness, and support the international community to better handle disputes and reach more consensus.
Second, in terms of the digital economy, we need to leverage its role to advance socio-economic development. We hope that the digital economy can become a major engine in driving global digitalization, empowering its transformation. We also hope that the international organization can make contributions to the global digital economy.
Third, in terms of digital technology innovations, we will strengthen cooperation with the international community, deliver more major outcomes for innovation, and boost the advances in technology. The latest technological innovations are released at the Wuzhen Summit every year.
Fourth, in terms of cultural exchanges, we will encourage cooperation with internet media, advance the development of internet culture, promote mutual learning among civilizations, raise the public's digital literacy, and push forward the sound development of online cultural industries.
Fifth, in terms of setting rules, we will continue our efforts to advance the progress of global internet governance and encourage corporate members, research institutions, and universities worldwide to conduct discussions and exchanges on governance rules and technical standards, among other areas.
Sixth, in terms of exchanges and cooperation, we will build better platforms for exchanges and cooperation between governments, international organizations, multinational enterprises, technical groups, and experts and scholars. The above are our expectations. Thank you.
Xing Huina:
Today's press conference is hereby concluded. Thank you to our speakers and all friends from the media. Goodbye.
Translated and edited by Gong Yingchun, He Shan, Wang Yiming, Yuan Fang, Xu Xiaoxuan, Zhang Rui, Cui Can, Zhang Liying, Li Huiru, Qin Qi, Liu Qiang, Yan Xiaoqing, Wang Wei, He Shan, Xu Kailin, Wang Qian, Zhu Bochen, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speaker:
Mr. Ran Chengqi, director general of the China Satellite Navigation Office and spokesperson of the BeiDou Navigation Satellite System
Chairperson:
Ms. Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Nov. 4, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO published a white paper titled "China's BeiDou Navigation Satellite System in the New Era," and organized this press conference to introduce and interpret its main content. The white paper fully implements Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, introduces China's policies to develop the BeiDou Navigation Satellite System (BDS) in the new era, and reviews the progress in BDS construction and application. According to the white paper, China has carried out active international cooperation on BDS and advanced its international applications so that the system can better serve the world and benefit humanity. The white paper points out that China will work with all other countries to promote the development of navigation satellite systems and contribute to building a human community with a shared future.
At around 12,000 Chinese characters, the white paper consists of preamble, main body and conclusion. The main body is divided into six parts: "BeiDou in the New Era," "A World-Class Navigation Satellite System," "Improving BDS Operation Management," "Promoting Sustainable Development of the BDS Applications Industry," "Upgrading BDS Governance" and "Contributing to Building a Human Community with a Shared Future." The white paper is published in eight languages — Chinese, English, French, Russian, German, Spanish, Arabic and Japanese — by the People's Publishing House and the Foreign Languages Press. It is available at Xinhua Bookstore outlets across the country. To help you gain an accurate and deep understanding of the white paper, we have invited Mr. Ran Chengqi, director general of the China Satellite Navigation Office and spokesperson of the BeiDou Navigation Satellite System, to brief you on relevant information and then take your questions.
Now, I'll give the floor to Mr. Ran for his introduction.
Ran Chengqi:
Ladies and gentlemen, it's my pleasure to meet with friends from the media again. Thank you for your interest in and support for BDS. On July 31, 2020, General Secretary Xi Jinping announced to the world that BDS-3 was officially commissioned, marking the successful conclusion of the three-step BDS strategy and ushering in a new stage for the system's high-quality development.
As all Party members and all the Chinese people are earnestly studying the guiding principles of the 20th National Congress of the Communist Party of China (CPC), here we are issuing the white paper "China's BeiDou Navigation Satellite System in the New Era." The white paper reviews the development course of BDS and shows that in the new era, China has improved the BDS service capacity, achieved new progress in related industries, increased openness for relevant cooperation, and embarked on a new journey of BDS development.
First, China's BDS in the new era is a world-class navigation satellite system.
Based on its national conditions, China has independently developed BDS. We have independently developed core technologies, laid out an innovative system configuration, and offered quality and diverse services. Since BDS-3 was formally commissioned, the system has maintained uninterrupted, stable and reliable operation, and provided world-class services.
The 30 in-orbit satellites of BDS-3 have maintained a good operation status. Millions of their components in more than 300 categories, all produced by China, demonstrate excellent performance. The system's measurement positioning accuracy worldwide is better than five meters. Its accuracy is higher in the Asia-Pacific region and its service performance is better than all design indicators.
The system offers six high-quality specialized services: international search and rescue, global short message communication, regional short message communication, satellite-based augmentation, ground-based augmentation, and precise point positioning. We are now able to provide a wide range of services and are even leading the way in some areas.
China has achieved intelligent operation and maintenance for BDS, upgraded the software of in-orbit satellites, conducted global real-time monitoring and assessment of the system, and released the latest information. Since the system was commissioned, China has ensured its continuous and stable operation and improved its performance. We have embarked on a sustainable development path for BDS featuring high quality and efficiency, and low cost.
_ueditor_page_break_tag_Second, large-scale application of China's BDS in the new era has entered a fast track of development.
China has achieved sustainable development of the BDS applications industry. The country has formulated industrial development strategies and included BDS industrial development into its 14th Five-Year Plan (2021-25). The system has been deeply integrated into infrastructure, empowered various industries and sectors, and served everyday life, delivering considerable economic and social benefits. In 2021, the total output of China's satellite navigation and location-based service industry reached 470 billion yuan, with a compound annual growth rate of over 20%.
China has forged secure and stable industrial and supply chains and reinforced the foundation of the BDS industry. We have built a complete industrial chain of chips, modules, antennas and boards, independently developed software and algorithms, and established a national product testing and certification system. Shipments of domestically manufactured chips exceeded 100 million, and foreign-manufactured chips of the same type are compatible with the system, thus ensuring the sound growth of the industry.
As BDS has been widely used in various industries and fields, its in-depth applications have grown. As of June, over 8 million BDS terminals had been installed on transport vehicles. Approximately more than 1.3 million terminals were used in the farming, forestry, livestock, and fishing industries and more than 1.8 million terminals adopted by public security organs. Large-scale BDS applications have been advanced in communication and timing services, meteorological monitoring, emergency response and disaster mitigation, and urban management.
BDS has a wide range of applications in people's daily lives and they have easy access to its specialized services. BDS is becoming a standard configuration for mass-consumption products such as smartphones and wearable devices. In the first half of this year, among all types of smartphones that applied for network access in China, 128 supported the BDS-based positioning function. More than 130 million smartphones supporting BDS services were shipped, accounting for over 98% of the country's total. The BDS positioning service is used more than 100 billion times on average every day for map navigation on mobile phones. In particular, the public's mobile phones have been fitted with high-precision positioning services. Lane-level navigation has been implemented in eight cities, including Shenzhen, Chongqing, and Tianjin. The first mobile phone in the world that supports BDS-3 regional short message communication services has been officially released. Users can send short messages through BDS without changing SIM cards or phone numbers or using extra equipment.
Third, China's BDS in the new era contributes to building a global community of shared future
China has been committed to the principles of openness and integration and advancing the internationalization of BDS. It advocates the compatibility and interoperability of different satellite navigation systems, promotes the ratification of BDS by international standards, and expands its international applications to serve the world and benefit humanity.
Statements on signal interoperability with GPS and GLONASS have been signed and cooperative talks with Galileo system have been held. China has promoted the compatibility and interoperability of diverse systems under the framework of the United Nations. Doing so ensures a user-friendly BDS with the compatibility of various systems to jointly provide high-quality, diverse, secure and reliable services for global users.
Bilateral cooperation has been expanded and deepened. Cooperative mechanisms have been built with regional organizations and countries in Asia, Africa and Latin America. Over 50 outcome documents have been signed, including cooperation agreements on satellite navigation, memorandums of understanding, and cooperation roadmaps.
Multilateral cooperation has been strengthened. China-ASEAN, China-Arab States, and China-Africa BDS cooperation forums have been launched and the action plan for satellite navigation cooperation has been carried out. China has held the annual China Satellite Navigation Conference and Annual Conference of China GNSS and LBS every year and initiated the International Summit on BDS Applications. More than 100 overseas students from about 20 countries have obtained professional master's and doctorate degrees in China. More than 1,000 people from over 50 countries have participated in special training on satellite navigation.
China has been promoting BDS to be ratified by international civil aviation, maritime, mobile communications and search and rescue standards. BDS products have been applied in more than half of the countries and regions in the world. A greater variety of products have been exported and the application fields continue to be expanded.
In addition, this edition of the whitepaper has also drawn the blueprint for developing BDS by 2035 for the first time. China will develop a new generation of BDS with more advanced technology, powerful functions and better services. The goal is to create a more extensive, more integrated, and more intelligent comprehensive system that provides navigation, positioning and timing services, laying a solid foundation of spatiotemporal infrastructure for China's modernization.
Exploring the vast cosmos has been the dream of the Chinese nation for millennia. From observing Beidou (Chinese pinyin for the Big Dipper) to developing and using BDS, from gazing at the stars to utilizing space, BDS in the new era will continue to advance human progress in exploring the universe and make an even more significant contribution to achieving the great rejuvenation of the Chinese nation and building a global community of shared future and a better world.
That's all for my introduction. Thank you.
Shou Xiaoli:
Thank you for your introduction, Mr. Ran. Let's move on to the question-and-answer session. Please identify the media outlet you represent before asking a question.
_ueditor_page_break_tag_China News Service:
Mr. Ran, you published the first whitepaper on BDS six years ago. You have now published another whitepaper on BDS. How have things changed and progressed in the second white paper? Thank you.
Ran Chengqi:
Thank you. The first edition of the white paper was published on June 16, 2016. At that time, BDS-3 was in rapid development. Six years later, we published the white paper on BDS again at a time when BDS-3 had been completed and the three-step BDS strategy had been fully concluded. More importantly, the white paper on BDS in the new era aims to present the progress of BDS and China's achievements and vision in developing BDS. It also aims to share our ideas and experience. Both white papers were developed alongside national development in the new era and aim to serve national rejuvenation.
Today, we release this white paper to update to the public about the latest overall situation of the commissioned BDS. First, BDS-3, the configuration that covers the entire globe, has developed into a world-class navigation satellite system featuring innovative designs in constellation configuration, technical system, services and function. Its technical system, signal design, and service functions are the most advanced and powerful in the world. Second, BDS in the new era can provide a wide range of quality services and conduct real-time global monitoring on a regular basis. The promised positional accuracy of BDS is 10 meters. But we have managed to improve it to within 5 meters. In some areas, it could be 2 to 3 meters. The timing accuracy we promised is 20 nanoseconds, and now we achieved 10. Third, BDS in the new era is under ever-improving management. I mentioned just now that the top priority is to ensure an around-the-clock stable operation of BDS. Its system performance has been constantly improved during this process. Disclosing relevant information, we have also worked to ensure that BDS remains open to the whole world. Fourth, BDS in the new era has deeply integrated into the country's overall economic development and the world's economic domain, injecting strong momentum to growth and benefiting the world and humanity.
Two of the most important parts in "China's BeiDou Navigation Satellite System in the New Era" highlight that BDS has entered a new era and its governance should be further modernized. We could interpret these two points from the following perspectives.
First, the three-step BDS strategy, particularly the complete construction of BDS, demonstrates the BeiDou Spirit of independent innovation, openness and inclusiveness, unity of purpose, and pursuit of excellence. It is a telling example of China's national spirit centered on patriotism and defined by reform and innovation in the new era. Independent innovation is the core competitive advantage. There would be no such top-class global navigation satellite system if we hadn't kept innovating on our own strength since the beginning of the endeavor. By embracing openness and inclusiveness, we have stayed true to our original aspiration of building a BDS for China and the world. Unity of purpose is the code to the success of BDS. It is an institutional advantage of socialism with Chinese characteristics to pool resources for major endeavors and forge ahead in unity. The constant pursuit of excellence is always on our agenda. We have worked hard to catch up and even harder to surpass and lead. That's how we turned BDS into one of the best navigation satellite systems in the world.
Second, the vision for BDS is fully elaborated. We have built a new generation of BDS that is more advanced, powerful, and capable of providing much better services than before. Next, we will construct an integrated space-time system featuring a more ubiquitous network, deeper integration, and greater intelligence, which will help improve people's well-being and promote the development and progress of humanity. In simple terms, in spite of the fact that BDS is already quite good, we plan to develop a space-time system centering around it, which boasts unified standards, seamless coverage, ensured security and reliability, high efficiency, and great convenience and diversity.
Third, we demonstrate to the public the modernized satellite navigation governance. We need to balance considerations and seek development. We will coordinate the domestic rule of law with foreign laws, accelerate the formulation of related regulations, participate in the global governance of satellite navigation, and ensure the standardized and sustainable development of BDS.
Fourth, BDS specialized services are publicized. It can provide seven types of services, including positioning and six other distinctive services. It is worth mentioning that the system's high-accuracy service and short message communication service are dashing into our lives and displaying the application strength of BDS. I may offer you more information on it later.
That's all I have to say. Thank you.
_ueditor_page_break_tag_China Daily:
I have two questions. Many map software operators have adopted BDS as their preferred positioning and navigation service option. Can you illustrate some other scenarios involving such high-accuracy applications in our daily life? Moreover, BDS officially launched a trial application for lane-level navigation recently. What do you think of its prospects? Thank you.
Ran Chengqi:
Thanks for your question. Just now, I talked about the application of BeiDou's high-precision positioning services. BDS has already provided positioning accuracy at 5 meters and above. However, with economic and social development, the positioning accuracy of 5 meters can no longer meet the needs of users, as the demand for accuracy in socioeconomic development is getting higher and higher. For example, there is a higher demand for accuracy in self-driving technologies, ride-hailing services, deformation monitoring, mudslide monitoring, precision agriculture, and other fields. What shall we do? We have innovatively proposed to build a ground-based augmentation system and achieve higher accuracy through matching and integrating the system with BDS across the country.
Now a nationwide network of BDS ground-based augmentation has been built to provide real-time meter-level, decimeter-level, centimeter-level, and post-processing millimeter-level high-precision positioning services for industrial users and the general public. For ground-based augmentation service, its real-time positioning accuracy can reach 2 centimeters horizontally and 5 centimeters vertically. The post-processing accuracy can reach 2 millimeters horizontally and 5 millimeters vertically. Such high-precision positioning services will lead to more diverse applications and services. For example, we have expanded application scenarios to precision agriculture, deformation monitoring, autonomous driving, electric power inspection, smart ports, and bike sharing.
Let me give you a few examples. At present, this network has provided BDS accelerated positioning and BDS high-precision services for more than 1.5 billion users in more than 230 countries and regions, with services delivered 2 trillion times in total, equivalent to nearly 3 billion on average per day. At present, BDS has provided high-precision positioning services for more than 20 million mobile phones in the country. You also mentioned lane-level navigation just now. In this regard, we have applied high-precision services to people's daily driving and vehicle navigation in a pilot program. It has been carried out in eight cities in China, including Shenzhen, Guangzhou, Dongguan, Chengdu, Chongqing, Hangzhou, Suzhou, and Tianjin. Going forward, we will further expand the program nationwide.
At present, BDS also provides high-precision services for a total of 1.1 million shared bicycles in China and 200,000 electronic fences for shared bike parking in 12 cities across the country. Haphazard parking of shared bicycles, a problem plaguing the city, has been tackled by BDS high-precision services. I am also a user of shared bicycles. If the bicycle is not parked in the designated zone, the rider will not be able to lock the bike. Through this technical method, relevant departments can adjust guidelines for high-precision application scenarios.
At the same time, this network also provides high-precision positioning services for 21 models of smart cars in China, with a mileage of over 2.5 billion kilometers, and for a total of 50,000 industrial drones of domestic drone companies. All of this shows that BDS high-precision applications point to the future of China's satellite navigation industry and has a broad market. We also look forward to seeing more uses of BDS high-precision services in all walks of life. Thank you.
_ueditor_page_break_tag_CCTV:
Mr. Ran mentioned that since the official commissioning of BDS-3 in 2020, the work focus has shifted from BDS construction to BDS operation management. BDS has been operating stably during the past two years, so what results have been achieved? What deficiencies need to be improved? Thank you.
Ran Chengqi:
Thanks for your questions. On July 31, 2020, General Secretary Xi Jinping announced that BDS-3 was formally commissioned, and emphasized to us that the system must be easier to use and more stable in operation. All services are built on the premise that the system is more stable and reliable. If not, competing in the market and providing services to the general public would be difficult. Therefore, operational stability has been considered a top priority since BDS-3 was completed. We have pooled relevant technical resources and teams at home, and unswervingly pursued stable operation and performance improvement.
I have an example. The technical standards of BDS availability we designed in the first place was 99%, which meant that 1% of the accuracy was allowed to exceed standards. Satellite navigation systems all over the world are using 99% availability standards, and the time when 1% of the accuracy exceeds the standards is about 86.4 hours per year. We have increased the availability standards from 99% to 99.9% through various parties' technical and management measures. Although it is only a 0.9% increase, which seems like a small step, it is a real giant stride. Through these methods, we have decreased the time length of BDS accuracy that exceeds the standards from 86.4 hours to 8.64 hours. Of course, 100% availability is guaranteed in the actual work. From 99% to 99.9% and then to 100%, this is the overall performance of BDS. We have realized round-the-clock services and no time period affects the use of the system, and we have made the impossible possible thanks to the joint effort of many scientific researchers. We have also adopted a series of advanced and innovative means. For example, in BDS operation, we carry out early warning and prediction or real-time monitoring to predict the situation of the sensitive single-machine systems or components on the satellite, and to make judgments based on the data of satellite operation. We also have a slogan called "spot problems before users do, identify signs of problems before they appear, and solve problems before they cause any impact," so we ensure that proactive measures are rolled out to eliminate hidden problems, give early warnings, and release information to users in a timely manner. We have made it so that from the beginning of BDS construction to the present, the system ensures stable operation, and offers uninterrupted services. We will continue to uphold this standard in the future to ensure BDS's continuous and stable operation. Thank you.
_ueditor_page_break_tag_Hong Kong Economic Herald:
We have learned that in the future, in terms of internationalization, BDS will continue to go global, and provide more products and services for overseas markets under the Belt and Road Initiative. Can you give a detailed introduction to the achievements of international cooperation regarding BDS? What are the plans for the next step? Thank you.
Ran Chengqi:
BDS development has been designed in such a way to ensure integration of construction, application and international cooperation since the very beginning. We always prioritize BDS going global and providing services worldwide, and pursue openness and cooperation for its development. We have advanced international cooperation concerning BDS-1, BDS-2, and BDS-3. We fully participate in international satellite navigation affairs. There are several aspects.
First, we have participated in the activities of the United Nations' International Committee on Global Navigation Satellite Systems, or ICG. As an original member, China has made its contributions to the ICG in a timely fashion, which were highly appraised by the UN and the UN Office for Outer Space Affairs (UNOOSA). China's BDS is a responsible system that leads the development of global satellite navigation systems. We have participated in previous satellite navigation work conferences and actively assumed responsibilities for BDS' part in relevant activities of UNOOSA. We have undertaken research on related topics, and participated in the forums of international organizations, in order to promote BDS to provide better services for all mankind. Among them is an organization for the application of satellite navigation systems for developing nations. China has also publicly advocated for it and offered help.
Second, we have actively conducted bilateral talks on cooperation. Above all, we have established specialized cooperation channels with major global navigation systems, such as the United States' Global Positioning System (GPS), Russia's GLONASS system, and Europe's Galileo system, and achieved sound progress. We have jointly promoted the application of global satellite navigation. We have signed the joint statements on compatibility and interoperability with the GPS system and the GLONASS system, and conducted frequency coordination with the Galileo system. In addition, we have conducted application cooperation with countries along the Belt & Road, including both bilateral cooperation and multilateral cooperation. For example, we have participated in and successfully held three sessions of China-Arab States BDS Cooperation Forum, two sessions of China-Central Asia BDS Cooperation Forum, and the First China-Africa BDS Cooperation Forum. We have jointly promoted the application of satellite navigation and BDS by issuing forum statements, action plans, and application scenarios. We have established close ties with countries in Central Asia and Africa, and regional organizations such as the League of Arab States and the Association of Southeast Asian Nations, and conducted in-depth cooperation in testing and evaluation, joint application, education and training, and technical cooperation. It's fair to say that the application of BDS has attracted massive attention and expectations from the world. A Chinese delegation recently attended the meeting of the International Committee on Global Navigation Satellite Systems, which was held in Abu Dhabi in the United Arab Emirates, and has received proposals from many countries and organizations for enhanced cooperation with BDS. They praised BDS as a useful system. We are particularly delighted to promote systems, products, applications, and concepts from China to the world.
Third, we have vigorously participated in multilateral organizations, including both international organizations and standard organizations, and accelerated the application of BDS in the fields of civil aviation, maritime, mobile communication, and international search and rescue. China's BDS has passed all 189 satellite navigation standards listed by the International Civil Aviation Organization (ICAO). We will fully join ICAO and further promote the application of BDS in the field of international civil aviation under the framework of ICAO. Since BDS-1, we have promoted ratification of BDS by the 3rd Generation Partnership Project (3GPP). Therefore, most smartphones we use today are equipped with BDS. We joined the International Maritime Organization in 2014 and other international search and rescue organizations. In light of the special contributions of BDS short message communication service, we have put forward new suggestions to international search and rescue organizations. When people encounter dangers at sea, they can apply for help to the search and rescue organizations. But the previous international rescue signal was one-way, so it was unknown to the caller whether the distress signal was received by search and rescue organizations. BDS ingeniously developed two-way signals to notify the caller that the distress signal has gotten a response, which would be a tremendous mental support for the caller. That is a great contribution from BDS to the international search and rescue efforts. Those BDS applications have been widely recognized among the public. Additionally, after the application of many products and technologies, as part of our efforts to help people to better understand BDS, we have promoted exchange activities, inviting foreign students to come to China to learn and receive training about our technologies and products so as to make people have a better understanding of China's BDS and its applications. Thank you.
_ueditor_page_break_tag_Southern Daily:
With the BeiDou-3 global navigation satellite system now operational, what is the current operating status of its satellites? Are there any new plans for further satellite launches to expand the existing BeiDou navigation constellation? Thank you.
Ran Chengqi:
As of now, we have a total of 45 satellites in orbit to provide services, including the BeiDou-3 satellites in orbit and the original BeiDou-2 satellites, which have been in service for an extended period of time, so the system has been functioning very well. Even in such a case, we have to continue to ensure stable operation and make performance improvements to the system. Based on that, we will make efficient use of the satellites in orbit and coordinate with ground systems. At the same time, we will actively promote the construction of a backup satellite system to further ensure the reliability of the system. According to our schedule, we have arranged the production and development of a backup satellite system, including three to five satellites, to be launched next year. We will further strengthen the construction of the constellation to ensure the stable operation of the system. As a major country, China will deliver on our promise of providing world-class services to the rest of the world.
On this basis, we will further develop the next-generation BDS. We haven't given it a name yet, but it will likely be Beidou-4. It should be better than Beidou-3, with enhanced system performance. At the same time, we need to further integrate it with emerging technologies, such as mobile communications, low earth orbit communications, traditional inertial navigation, and so on. The technologies should be deeply integrated. The next generation will be a more ubiquitous, more intelligent, and more integrated. You may feel the three "mores" are very broad and vague, but in fact, to put it simply, BDS is still the core, and we will incorporate all the emerging technologies related to space-time information into this system, developing it synchronously at a faster speed. Our projected goal is to fully build this space-time system by 2035. By then, we hope that Beidou, China's time-space system, will be everywhere, including underwater, on the ground, indoors, in the air, in deep space, or even in distant outer space. Simply put, Beidou will provide you with safe and reliable space-time technology anywhere anytime. This is our overall consideration for development. Thank you.
_ueditor_page_break_tag_Cover News:
Mr. Ran, you just introduced that the Beidou's goal is to build a more ubiquitous, integrated, and intelligent space-time system. Can you explain the specific meaning of this goal? What more needs to be done to achieve this goal? Thank you.
Ran Chengqi:
I have sort of answered this question just now. Everyone has paid great attention to Beidou-3. It is really good. Will there be anything better than it later on? Our answer is yes. For Beidou-3, we should ensure that the system itself continues to improve. How to develop it into the next generation of BDS? First of all, we should build the next-generation BDS, likely BeiDou-4, to be better. This system will make further breakthroughs. First, for the satellite constellation, we now have medium-orbit and high-orbit satellites. In the future, we will also consider including low-orbit constellations to build a navigation constellation for high, medium, and low orbits. In addition to providing reliable and better performance in positioning and navigation services, there's the high-precision positioning service as I mentioned earlier. Everyone feels it is great to use, but that service is only applicable inside China. Can we push this network to be used universally? This is our expectation for the future. We particularly hope to provide such a high-precision, highly reliable, and powerful space-time network through the integration of high, medium, and low-earth orbit constellations as well as the integration with mobile communications and low-earth orbit communications. We especially hope that after construction is completed, users all over the world can share the positioning accuracy of 5cm, 2cm, 5mm, and 2mm. We have made a great demonstration of its technology, and the scheme is sound. We are very confident about its construction pace.
We also hope to lead the development of the global satellite navigation system and even the space-time field after the construction of the next-generation space-time system so that it is more ubiquitous, more integrated, and more intelligent. Being ubiquitous means the integration of various technologies and methods, including seamless coverage, which aims to solve all the problems related to space. General Secretary Xi encouraged us to "explore the vast universe," and we will go further and go to deep space. We should rely on China itself for our space-time benchmark. Whether there is a space-time benchmark in the far space of the Milky Way Galaxy... we are also working hard on it. We believe that the next generation of space-time benchmarks can solve this problem. I want to say we are looking forward to a promising future. The year 2035 is our goal. We hope to do better on this basis to make Beidou's highly reliable and high-quality services available at any time. Of course, through such high-quality services, we will also promote the development of the economy, society, and industrial chain and make new contributions to national economic and social development. Thank you.
_ueditor_page_break_tag_Tianmu News:
You mentioned mass consumption and mass applications, and now we have no sense of security without mobile phones. Not long ago, the first mobile phone to support Beidou-3's short message communication service was launched. I would like you to elaborate further on it. How was this function realized? And will other mobile phones and smartphones also support this function in the future? Thank you.
Ran Chengqi:
Thank you for your question. I wanted to share this but never got a chance to do so. The application of BDS short message communication services to mobile phones is a dream we had as early as BDS-3 was proposed and approved. In addition to positioning and navigation services, BDS-3 also features a short message communication service. This function is amazing, but its application requires an expensive, exclusive terminal that must be independent of mobile phones and thus would bring a lot of inconveniences. At that time, we wondered if this function could be incorporated into mobile phones. This was a good concept, but we faced many technical problems. It takes 10 years to sharpen a sword, and it took us 10 years to work on this function. We achieved it thanks to China's progress in communications, our technological advances in the chip industry, and especially to the mobile operators and mobile phone producers.
We first built a short messaging civil platform for BDS to deliver all the short message services. It is available to China Mobile, China Telecom and China Unicom users if combined with these mobile operators. However, it posed a great technical challenge to include these services in mobile phones. We often said it was one of our dreams to directly connect satellites with mobile phones. Today, we've achieved it. We made the terminal miniaturized and chip-based with low power consumption to realize the function. It was not our purpose to adopt another independent terminal. We wanted the function to be included in mobile phones. Thanks to our technological progress and joint efforts, we solved the issue by developing the BDS short message communication radio-frequency baseband integrated chip technology.
The function was finally included in modern mobile phones as a chip and perfectly integrated. Today's chip owes much to the efforts of mobile phone manufacturers, who did an excellent job dealing with the technical system, signal design and key problems. The current chip can be made into a mobile phone roughly at the cost of 10 yuan ($1.38) without changing the phone card and number or adding peripherals. There is no difference between a BDS-enabled mobile phone and other mobile phones. However, with this chip, we can send information through this mobile phone when there is no mobile signal. The advantage is that you can still send text messages, report your location, and provide your location track in that case. You may think that this function can hardly be felt in daily life. But ask yourself how you would feel if your mobile phone had no service, but was equipped with this function. I often say that you may never use the function, but you gain a sense of security. Nowadays, it has been widely applied to many mobile phones. You will have a sense of security if you can always connect with the outside or be seen online. The status is the security guarantee BDS provides.
In the future, we also plan to open the technology to domestic mobile phone manufacturers to provide better services. We hope more domestic mobile phone manufacturers and operators will participate. What we especially want to see is that BDS telecommunication services contribute much to our economy and society and provide a more reliable guarantee for public travel safety. We have realized the function. We can ensure that BDS-3 service covers people in the Asia-Pacific based on its capability. With a mobile phone in hand, one can travel over the Asia-Pacific and even the world. BDS has also set a precedent for direct satellite connection with mobile phones. The exploration is helpful. Some international mobile phone brands are also in pursuit of this function. From this point of view, applying BDS short message communication services to mobile phones is leading to progress in innovation. Thank you.
_ueditor_page_break_tag_The Poster News APP:
Since the 18th CPC National Congress, BDS has been used in more than half of the countries and regions in the world as a pacesetter of aerospace science and technology products for export and has become a well-known global brand. Could you give some examples of BDS applications overseas? Thank you.
Ran Chengqi:
Regarding the international application of BDS, we have promoted it as a priority when participating in activities of relevant UN organizations and maritime and mobile communication organizations as well as relevant bilateral activities. We remain committed to advancing BDS' international application, and our focus is countries along the Belt and Road. The BDS' global commitment and China's status as a responsible major country has made it imperative to better promote BDS internationally. In fact, we already promoted BDS internationally when BDS-2 was completed in 2012, and achieved remarkable results thanks to our continuous efforts. When the basic system of BDS-3 was completed in 2018, it provided services for countries along the Belt and Road first. To foster understanding of the system, we have organized multiple international training courses on its application, as just mentioned. I'd also like to provide several specific, more impressive application cases here.
BDS has become accessible in more than half of the world's countries and regions. For example, in Saudi Arabia, it has been used for surveying, mapping and collecting geographic information, developing urban infrastructure, and positioning people and vehicles in deserts, among other important fields, winning widespread acclaim from local users. In Tajikistan, real-time, continuous monitoring of the Ozero Sarezskoye Dam was carried out based on BDS to detect deformation with millimeter-level accuracy, thus ensuring the dam's safety and the lives of local people. In Lebanon, BDS' high-accuracy technology was used for wharf construction surveying at the Beirut Port. The Burkina Faso government in Africa used BDS' high-accuracy technology to carry out surveying and mapping for hospital construction, thus finishing the surveying work within six days and shortening the construction time by half, significantly contributing to pandemic control. BDS has been successfully applied in ASEAN, South Asia, East Europe, West Asia and North Africa. It has provided good services to the China-Europe freight trains. China and Russia have also conducted stronger and closer cooperation in many navigation application fields under a framework agreement for strategic cooperation until 2025. BDS has also done a good job in serving relevant road transportation systems and cross-border transportation. Such cases are too numerous to list. I want to say that BDS products and technologies have been applied in more than half of the world's countries, and we will continue to promote its application systematically. I hope that our media friends can help publicize BDS so that the world can better understand it. Thanks.
_ueditor_page_break_tag_Beijing Office of Changjiang Daily:
China has seen bumper harvest this year. Could you share with us the application of BDS technology in agriculture? Thanks.
Ran Chengqi:
The application of BDS in agriculture has drawn much attention. The high-precision agricultural application of BDS will be significant since agriculture constitutes a vital area. During my visit and field trip to Xinjiang around five or six years ago, I saw the high-accuracy application of BDS. For example, I was told that when there were no high-precision products, the labor intensity of drivers was very high as they had to maintain precision while operating the harvesters and other agricultural machinery. After the broad application of the highly accurate BDS, the accuracy of the agricultural machinery can reach about two centimeters, greatly easing the drivers' labor intensity. A driver told me he didn't need to do anything in the machinery except turn the steering wheel in a corner. The vast land of Xinjiang means that farming machinery must drive long distances. Therefore, BDS could be applied well in fertilization, sowing, agrochemical spraying, harvesting and other agricultural activities. I was also told that thanks to high-precision BDS, the precision of seedling fertilization could reach around two centimeters. This seemingly small technological progress can bring about significant changes. For example, precise plowing, agrochemical spraying, and fertilization can significantly cut costs, improve efficiency, reduce labor intensity, and increase the returns of the farms.
The high accuracy of BDS has been applied in agriculture in several other cases. BDS has fully empowered agricultural production and become a vital scientific and technological force driving agricultural development. According to incomplete statistics, the number of automatic agricultural machinery based on BDS has exceeded 200,000 units (sets) this year, providing tangible services for farmers and improving agricultural ecological efficiency. During the past autumn, BDS-based self-driving tractors, seeders, harvesters and other agricultural machinery, and drones played a significant role in harvesting, plowing and sowing in Beijing, Hebei, Henan, Shandong, Zhejiang, Jiangsu, Heilongjiang, Gansu and other places. Many farmers plan the routes of the machinery through mobile phones and accurately stay on top of the farming work. BDS is now serving as a real "golden key to a good harvest" for farmers. I believe that BDS will continue to support China's precise agricultural development in the future. Thank you.
_ueditor_page_break_tag_CNR:
We know that BDS has become a new economic growth driver. Since BDS-3 was opened to global users more than two years ago, a host of BDS-related new industries have emerged. How important are these emerging industries to China's economic growth? Thank you.
Ran Chengqi:
This question is a bit difficult to answer. Why? We often say that BDS is ubiquitous at every time. Since time and space information is necessary for everything, there is a line in the BDS community that satellite navigation applications are only limited by human imagination. I remember saying at other press conferences that if you think about it, without spatiotemporal information, the information we obtain and our perception of the world will be inaccurate or even useless. Therefore, time and space are crucial to our economic and social development. With the transformation of the economy and society, the development of information technology, and the advancement of intelligence and automated technologies, spatiotemporal information, especially that of high precision, has become more prominent. You referred to emerging industries in your question, but I can't find a single sector without a BDS application. We are also looking forward to integrating with emerging technologies. We are delighted to say that BDS can be integrated into all walks of life and with all emerging technologies, including intelligent technologies, automated technologies, cloud computing and big data. We often say that BDS serves everyday life. In my view, be it in the traditional industries or emerging and future industries, BDS, now well applied in various sectors, can always play a role by providing spatiotemporal information.
We have conducted over 50 demonstration projects with relevant ministries and commissions in various provinces and cities. For example, in 2012, we worked with the Ministry of Transport. We carried out the BDS demonstration application on chartered tourist buses, regular buses at class III (serving between non-adjacent counties) or above, and vehicles carrying dangerous goods. We aimed to cover 79,000 vehicles at that time. By June this year, however, the number had exceeded 8 million. If BDS is applied to more vehicles, mobile phones and industries, it will surely become a system offering comprehensive services to diverse industries. For the better operation and development of BDS, I hope that all walks of life can pay more attention to spatiotemporal information and BDS applications. The development of BDS is integrated, which can spur new sectors and industries and drive overall socioeconomic development in China. Thank you.
Shou Xiaoli:
Thank you, Mr. Ran Chengqi. Thanks to the friends from the media for your participation. Today's briefing is at this moment concluded. Goodbye, everyone.
Translated and edited by Zhang Liying, Wang Wei, Li Huiru, Qin Qi, Huang Shan, Zhang Rui, Liu Qiang, Duan Yaying, Wang Yiming, Zhang Tingting, Yuan Fang, He Shan, Yan Bin, Ma Yujia, Xu Xiaoxuan, Yang Xi, Xu Kailin, Zhang Junmian, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speaker:
Wang Chunying, deputy administrator and spokesperson of the State Administration of Foreign Exchange (SAFE)
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
July 22, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the SCIO. This is a regular briefing on China's economic data. Today, we are delighted to be joined by Ms. Wang Chunying, deputy administrator and spokesperson of the SAFE, who will introduce China's foreign-exchange receipts and payments data in the first half of 2022 and take your questions.
Now, let's give the floor to Ms. Wang for her introduction.
Wang Chunying:
Good morning. Welcome to today's press conference. I'll begin by introducing China's foreign-exchange receipts and payments data in the first half of 2022, and then answer your questions.
Since 2022, the international landscape has been complex and challenging, with continued COVID-19 outbreaks and the prospect of global economic growth weakening. Under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, China has effectively coordinated pandemic prevention and control with socio-economic development. Recently, major macroeconomic indicators have stabilized and picked up, and the economy has shown a general trend of recovery and development. Against this backdrop, China's foreign exchange market has become more resilient, the RMB exchange rate has been relatively stable and sound, and cross-border capital flow has been generally steady. In the first half of 2022, foreign exchange settlement and sales by banks registered $1.33 trillion (or 8.6 trillion yuan denominated in RMB) and $1.24 trillion (8.1 trillion yuan), respectively, creating a surplus of $85.2 billion (545.2 billion yuan). The cross-border receipts and payments by non-banking sectors stood at $3.16 trillion (or 20.5 trillion yuan denominated in RMB) and $3.08 trillion (20 trillion yuan), respectively, resulting in a surplus of $83.4 billion (533 billion yuan). In the first half of this year, China's forex receipts and payments showed the following main features:
First, forex settlement and sales by banks as well as cross-border receipts and payments by non-banking sectors continued to create surpluses, with both recording a surplus of over $80 billion in the first half of this year as I said just now. This is mainly because the basic surpluses in trade in goods, direct investment and other fields were kept at a high level. Specifically, in the first quarter, forex settlement and sales by banks as well as cross-border receipts and payments by non-banking sectors maintained high-level surpluses of $58.7 billion and $62.2 billion, respectively. In the second quarter, when the domestic situation and external environment were more complicated, the two indicators created surpluses of $26.5 billion and $21.1 billion, respectively.
Second, forex selling rate edged up and cross-border financing of enterprises remained stable. In the first half of this year, the forex selling rate measuring the willingness to buy forex, which is the ratio of forex customers buying from banks to their foreign-related forex expenditure, reached 66%, up by 2 percentage points over the same period last year. In terms of foreign investment financing, by the end of June this year, the forex loans of Chinese enterprises and other market entities at home amounted to $351 billion, which was basically the same as that at the end of 2021. Cross-border trade financing, including import payments by overseas agents and forward letters of credit, registered $116.4 billion, slightly lower than that at the end of 2021. This is the second feature.
Third, forex settlement rate increased steadily and enterprises' forex deposits were basically stable. In the first half of this year, the forex settlement rate measuring the willingness to settle forex, which is the ratio of forex customers selling to banks to their foreign-related forex income, was 67%, up by 0.4 percentage point from the same period in 2021. By the end of June this year, the forex deposits of Chinese enterprises and other market entities at home amounted to $695.1 billion, basically in line with that at the end of 2021.
Fourth, forex derivative transactions maintained growth and market players' awareness of exchange rate risk management steadily increased. In the first half of this year, to manage exchange rate risks, enterprises employed forward derivatives, options and other derivatives of more than $750 billion, an increase of 29% year on year, which was significantly higher than the growth rate of forex settlement and sales in the same period. As a result, the hedge ratio of enterprises rose to 26%, 4.1 percentage points higher than that of last year. This shows that market entities are more aware of averting exchange rate risks and are better able to adapt to fluctuations in the RMB exchange rate.
Fifth, the amount of forex reserves remained basically stable. At the end of June, China's forex reserves registered $3.07 trillion. Since the beginning of this year, the U.S. dollar index has risen remarkably and the prices of financial assets in major countries have fallen sharply. Forex reserves will drop in amount when denominated in dollars. This, coupled with changes in asset prices, constitutes a vital reason for the changes in the book value of forex reserves.
Going forward, the State Administration of Foreign Exchange (SAFE) will conscientiously implement the decisions and arrangements of the Party Central Committee and the State Council. We will act on the general principle of pursuing progress while ensuring stability, continue to deepen the reform and opening up in the field of foreign exchange, further facilitate cross-border trade and investment and financing, and serve the development of the real economy. Meanwhile, we will strengthen the study and judgment of the situation of foreign exchange revenue and expenditure. We will improve the regulatory framework underpinned by both macro-prudential governance and micro-prudential supervision for the foreign exchange market, and maintain the steady operation of the foreign exchange market and national economic and financial security. These efforts will enable us to pave the way for a successful 20th CPC National Congress.
The above is the main statistical data for foreign exchange revenue and expenditure in the first half of 2022. You are now welcome to ask questions about foreign exchange revenue and expenditure.
Shou Xiaoli:
The floor is now open for questions. Please identify the media outlet you represent before raising questions.
_ueditor_page_break_tag_CCTV:
Since the beginning of this year, the external environment has become more challenging and complicated. How do you evaluate the performance of China's foreign exchange market in the first half of this year?
Wang Chunying:
Since the beginning of this year, although we have faced more complicated and severe external shocks and challenges, we can see the enhanced resilience of China's foreign exchange market. It is evident both from the price indicators related to the RMB exchange rate and the quantitative indicators such as the balance of payments and receipts and payments with foreign involvement. To be specific:
First, the RMB exchange rate has become more resilient and performed steadily worldwide. This year, affected by the interest rate hike of the U.S. Federal Reserve, the geopolitical conflict, and multiple other factors, the main change in the international foreign exchange market is the strengthening of the U.S. dollar and the weakening of major non-U.S.-dollar currencies. Against such a backdrop, the RMB exchange rate against the U.S. dollar has depreciated. However, compared with other major international currencies, the value of the RMB has been stable. Judging from the rise of the U.S. dollar index and the decline of other major currencies, the U.S. dollar index has increased by more than 11% since the beginning of this year. The depreciation of the euro, sterling, and yen against the U.S. dollar has been kept between 10% and 17%, and the depreciation of the RMB against the U.S. dollar has stood at 5.8%. From the multilateral exchange rate perspective, the RMB exchange rate index has seen an appreciation of 0.1%, indicating that the RMB is stable against a basket of currencies. Regarding exchange rate expectations, the relevant indicators of foreign exchange forwards and options have shown that there are no notable appreciation and depreciation expectations for the RMB exchange rate. In general, market entities have maintained a rational and orderly trading mode. Viewing the recent performance, although faced with a strong U.S. dollar, as the domestic economy has become stable and been recovering, the stability of the RMB exchange rate has become more prominent among the major global currencies. Since July, the multilateral exchange rate has risen steadily.
Second, China's cross-border capital flows are generally stable, demonstrating a relatively balanced development trend. At the beginning of this press conference, we introduced that in the first half of this year, there was a certain amount of surplus in the international receipts and payments via banks and in the foreign exchange settlement and sales by banks. Recently, short-term fluctuations and seasonal changes were seen in several channels. However, the basic equilibrium of cross-border capital flows was maintained, reflecting the robust performance of China's balance of payments structure.
Third, the current account surplus and long-term capital inflows are the fundamentals to stabilize China's cross-border capital flows. On the one hand, the current account maintains a reasonable surplus. In the first quarter of this year, the current account surplus reached $88.9 billion, the highest compared with the same period throughout history, and an increase of 25% over the same period last year. The ratio to GDP stood at 2.1%, which was within a reasonable range. In the second quarter, the trade surplus of goods was relatively high, and the deficit of cross-border travel and other service trade was low. It was estimated that the current account would continue the pattern with a reasonable surplus. On the other hand, direct investment under the capital account and medium- and long-term asset allocation funds are still playing a leading role. China's economy has maintained long-term growth, and China has been continuing to improve its market environment. Our efforts have helped attract capital inflows for direct investment and medium - and long-term asset allocation. From January to May this year, the utilized foreign investment was $87.8 billion, registering an increase of 23% year on year. Investment from overseas central banks and allocated funds tracking international indexes were stable in China's bond market, counterweighing the short-term fluctuations of cross-border capital.
Generally speaking, China has efficiently coordinated epidemic prevention and control with economic and social development. The strong resilience, ample potential, and vast room for maneuver of the Chinese economy have all laid a good foundation for the smooth operation of China's foreign exchange market and provided more support for China to cope with changes in the external environment. Thank you.
_ueditor_page_break_tag_China Economic Information Service:
The tightening of monetary policy in major developed economies has been accelerating, significantly impacting global cross-border investment and financing. Against this background, what's your opinion on the changes and trends of the foreign holdings of China's bonds? Thank you.
Wang Chunying:
We have touched upon several issues related to your question, but I'll give more explanation. Recently, we have seen major changes in the international financial market. The exchange rate and interest rates of the U.S. dollar have risen rapidly, coupled with capital outflows from emerging economies. From a global perspective, we have made observation and analysis on a longer-term basis, and we have several ideas to share with you.
First, China's bond market has gradually become an important global cross-border investment destination. In recent years, China's bond market has been opening steadily, and cross-border transactions have become more convenient. China's bonds have been included in the three major international indexes, and the impact and attractiveness of the domestic bond market have improved dramatically. Under this background, at the end of 2021, China attracted nearly $820 billion in cross-border bond investment, accounting for about one third of emerging economies' total external bond investment. It includes the bonds purchased by overseas investors within China and the bonds that domestic entities issued overseas. Both of them have significantly increased or remained active. This is for the stock of the bond. In terms of flow, we expanded the opening up of the securities market in 2017. From 2017 to 2021, the amount of cross-border bond investment funds introduced by China ranked the fourth in the world, following the U.S., Britain, and Japan. After years of development, China has become one of the major destinations for global cross-border bond investment. The recent market fluctuations have not changed this.
Second, from a global perspective, China has been attracting bond investment on a solid footing. The bond market fluctuation is normal. It is normal to have fluctuations in bond investments in countries, whether in developed or emerging economies. For example, there are often fluctuations in the U.S. Treasury market, which is the world's largest treasury market, when some countries reduce their holdings. We have also observed the fluctuations of bond investments in major countries. By comparison, we found that China's fluctuation is much lower than that of many developed and emerging economies. Judging from the composition of foreign investors and the scale of their bonds, institutions like central banks have always held more than half of China's bonds. Meanwhile, a large part of the rest has been the allocation funds tracking international indexes, which have also been relatively stable.
Third, further opening up the bond market will help improve the foreign exchange market's resilience. In recent years, there has been a steady inflow of cross-border capital, such as trade in goods and direct investment. Such capital has contributed to basic surpluses. The opening up of China's bond market has also diversified the participants and capital resources of the foreign exchange market, which helps to improve China's foreign exchange market and strengthen its capacity to withstand various influences.
We have shared some of our analyses and observations in response to your question. In general, China's bonds not only maintained investment diversification, but also serve the need for capital allocation and are supported by the fundamentals. The total size of China's bond market is $21 trillion, and foreign capital accounts for only about 3% of China's bond market. That means there will be more foreign investment in China's bond market. In the long run, we are confident that foreign investors will steadily increase their holdings of RMB bonds. Thank you.
_ueditor_page_break_tag_Jiemian News:
How do you evaluate the profit outflow of foreign companies since the beginning of this year? Compared with previous years, will the pressure of profit outflows increase this year? Thank you.
Wang Chunying:
Each year, the second and third quarters are the peak seasons for profit remittance of foreign companies. Based on the current situation, profit remittance of foreign companies this year has maintained a reasonable, orderly, and generally stable momentum. Its impact on China's cross-border capital flow and supply and demand for foreign exchange has been controllable. I would like to share with you the following respects in this regard.
First, the current profit remittance of foreign companies matches the scale of China's investment stock. China's business environment has continued to improve in recent years. Foreign investors are confident in the long-term prospects of the Chinese market. More and more multinational companies invest and do business in China and share the benefits of China's economic growth, reform, and opening up. Furthermore, their profits have been growing steadily, so their profit remittance has been increasing accordingly. From 2020 to 2021, the direct investment stock absorbed by Chinese enterprises increased by an average of 14% annually, and the profit remittance went up by an average of 13% annually.
Second, the impact of profit remittance on the country's international balance of payment and foreign exchange market supply and demand is within a reasonable range. Return on investment (ROI) is part of the current account. There are capital inflows and outflows under the categories of trade in goods, trade in service, and ROI, which have jointly ensured the reasonable and balanced surplus pattern of the current account. Meanwhile, the proper and orderly profit remittance has not influenced the overall balance of foreign exchange market supply and demand at home. In addition, benefitting from the growing internationalization of the RMB and its stable value, a considerable proportion of foreign companies' profits are remitted in RMB, which has a relatively small direct impact on the supply and demand of the domestic foreign exchange market.
Third, profit remittance does not mean withdrawing the investment but has formed a virtuous cycle with the inflow of direct foreign investment. International investors' willingness to invest long-term in China continues to be strong because China's prosperous economic outlook can bring sustainable and stable returns. Besides the newly added investment capital and the inflow of shareholder loans, many foreign companies have reinvested a considerable proportion of their profits in China. Compared with other major economies, the proportion of profits reinvested by foreign companies in China is high.
I would like to take this opportunity to stress that the SAFE's policies on profit remittance are consistent and continuous. There are policy guarantees for profit remittance of foreign companies as long as they are conducted in accordance with laws and regulations. Thank you.
_ueditor_page_break_tag_China News Service:
Given the global liquidity tightening, the cost for external financing is on the rise. China's outstanding foreign debt fell in the first quarter. How do you see the risk of deleveraging of China's foreign debt? Thank you.
Wang Chunying:
According to the latest statistics, China's outstanding foreign debt stood at about $2.71 trillion at the end of the first quarter, down $36.4 billion or 1% from the end of the previous year, which is considered to be a mild change. Due to the impact of the Fed faster tightening of monetary policy and various complex external factors, China's foreign debt will maintain a reasonable and orderly development trend for a period in the future. We believe the risk of deleveraging you are concerned about is controllable in general. I'll provide the following aspects to support my judgment.
First, the growth rate of foreign debt is relatively stable. In recent years, the proportion of China's foreign debt in GDP stood at 14%-16%. The growth rate of foreign debt is in line with economic development, and there is no excessive accumulation. During the current round of the Fed's loose monetary policy, there was no continuous and intensive cross-border funding, which means that there was no excessive leverage of foreign debt. So, the risk of deleveraging is controllable in general. As the external environment is being adjusted, the RMB exchange rate has become more flexible with two-way fluctuation. The exchange rate expectation is relatively stable, so the risk of deleveraging foreign debt is low.
Secondly, China's foreign debt structure has been continuously optimized. The growth of China's foreign debt has been largely attributed to overseas institutions' investment in domestic RMB bonds, most of which require long-term investment demand. The growth of traditional financing foreign debt is relatively slow. All structures of China's foreign debt types, currency, and debt maturity have been improved. Meanwhile, the balance between external assets and liabilities has improved structurally and continuously. Generally speaking, China remains to be a net foreign creditor with all types of external assets exceeding external liabilities by $2 trillion, which means that the net external claims shown on the International Investment Position for the first quarter of this year was $2 trillion. The combined outstanding external debt of banks, companies, and private sectors had reached $2.1 trillion by the end of the first quarter of this year, accounting for 79 percent of China's full-scale outstanding external debt. Private sectors' external credit assets reached $3 trillion, higher than the external debt taken on by them. The credit assets mainly refer to highly liquid assets such as bonds, deposits, and loans. We believe that with the effective adjustments of the foreign exchange market, the private sector including banks and companies will be able to meet debt obligations and strike a balance between external assets and debts.
Thirdly, the safety indicators of China's external debt remain sound. As a net-saving country, China's current account has maintained a certain scale of surplus. Being the indicators measuring a country's solvency, the external debt ratio, debt ratio, and debt serving ratio were within the safe zone in accordance with international standards in 2021, and much lower than the overall level of developed countries and emerging market economies. Regarding short-term liquidity, China's foreign exchange reserve ranks first in the world at present, with the ratio of short-term external debt to foreign exchange reserve being 45 percent, much lower than the international warning line of 100 percent.
That's all my response to your questions. For the next step, we will strengthen monitoring and analysis of the external debt situation, effectively preventing possible risks. Thank you.
_ueditor_page_break_tag_Bloomberg:
As the Fed tightens monetary policy, both the yen and the euro have devalued. Against such a backdrop, how do you perceive the outlook of the RMB exchange rate in the second half of this year? Thank you.
Wang Chunying:
As I just mentioned, the RMB exchange rate was generally stable for the first half of this year, with steady development. Regarding the next half year that you inquired about, the RMB exchange rate will stay basically stable on an appropriate and balanced level. Here are the factors that support this conclusion.
First, China's economic recovery continues to gather steam with major economic indicators improving. Industrial and supply chains remain stable and will continue playing a fundamental role in the consolidation of the RMB exchange rate.
Second, China's foreign trade and foreign investment show resilience. Trade and investment in the real economy will continue to see net inflows of funds, contributing to the basic balance of supply and demand in the foreign exchange market.
Third, market entities' expectations for the exchange rate remain basically stable. They have kept the rational trading model of "Buy low, sell high."
Moreover, China's structure of external assets and liabilities has been continuously optimized. The scale of foreign exchange reserve remains generally stable, continues to be the first in the world, and remains a stabilizer and cornerstone of the national economic and financial security. It's true that the future tendency of the RMB exchange rate will be partly affected by multiple factors, such as foreign exchange supply and demand and international financial markets. And there could be upward or downward fluctuations in the short term. However, the RMB exchange rate will maintain flexibility and two-way fluctuations while staying basically stable on an appropriate and balanced level. Thank you.
_ueditor_page_break_tag_CRI:
What efforts has the SAFE made to better manage foreign exchange risks in the first half of this year? How well did they work? What's the next step? Thank you.
Wang Chunying:
The SAFE has actively supported enterprises to manage foreign exchange risks and served the development of the real economy. As part of our efforts to advance stability on the six fronts and security in the six areas, especially keeping foreign trade and market entities stable, we have adopted a set of measures to cut the cost of exchange rate hedging and enhance enterprises' ability to deal with foreign exchange risks with a focus on the micro, small, and medium-sized enterprises. Next, I would like to briefly introduce some of our key tasks.
First, in April, the People's Bank of China (PBC) and the SAFE jointly issued a document encouraging qualified regions to strengthen cooperation between governments, banks, and enterprises. It encouraged exploring and improving the sharing mechanism for exchange rate hedging costs, expanding the government financing guarantee system, and providing guarantees for enterprises in terms of trade financing and exchange rate hedging business. It also instructed the China Foreign Exchange Trade System to waive inter-bank foreign exchange market transaction fees related to foreign exchange derivatives transactions of micro, small and medium-sized enterprises.
Second, in May, the SAFE issued the "Circular on Measures to Further Promote the Foreign Exchange Market to Serve the Real Economy." We introduced innovative foreign exchange options, launched two types of options products, expanded the business scope of jointly handling RMB and foreign exchange derivatives, and supported qualified small and medium-sized financial institutions to better provide exchange rate hedging services for micro, small and medium-sized enterprises. The Ministry of Commerce, the PBC, and the SAFE jointly issued a document requesting all localities to use the special funds for foreign trade development to provide enterprises with public services such as business training and information services in exchange rate hedging.
Third, we continue to increase publicity and training efforts. To make the relatively specialist issue of foreign exchange hedging more understandable and popular, we compiled the 50,000-word "Guidelines on Enterprise Exchange Rate Risk Management," published on our official website on July 1. You can read it on our official website. The guidelines provide a detailed introduction to the neutral connotation of exchange rate risks, the institutional framework of exchange rate risk management for enterprises, the adaptation scenarios of foreign exchange derivatives, and the use of hedging accounting. At the same time, the document provides targeted guidance on the difficulties existing in the hedging of state-owned enterprises and micro and small enterprises. A number of outstanding enterprise cases are included in the guidelines, based on their practices in exchange rate risk management in recent years. While compiling the guidelines, we paid particular attention to using easy-to-understand words. As a result, the readability is excellent. We hope to provide a valuable reference for foreign-related enterprises' exchange rate risk management.
Thanks to the efforts of all parties, in the first half of this year, the foreign exchange derivatives such as forward options, used by enterprises to manage exchange rate risks, reached $755.8 billion, up 29% year on year. The foreign exchange hedging ratio hit 26%, 4.1 percentage points higher than last year. Nearly 17,000 enterprises registered accounts for exchange rate hedging for the first time. Most of these new accounts are micro, small and medium-sized enterprises, especially the micro and small. These "first-time accounts" are of great significance. Only when enterprises get to know exchange rate hedging, and recognize and understand its benefits will they use it further. Therefore, we support the work to push for "first-time accounts."
Next, we will continue to do targeted work. First, we will release the dividends of the exchange rate risk management policy, break through the existing blockages in implementing the policy, and strengthen the policy transmission to financial institutions. We will urge financial institutions to enhance their initiative and professional level of helping enterprises better hedge exchange rate risks. Second, we will continue to support localities where conditions permit to replicate and promote the successful practices of micro, small and medium-sized enterprises in exchange rate risk management. We will use relevant special funds well and implement the policy of fee reductions and interest concessions. Third, we will take the release of the guidelines as an opportunity to continue to increase cooperation, publicity, and training with state-owned assets, commerce, and other departments. We will use our knowledge to enhance enterprises' awareness of exchange rate risk neutrality. We will assist them in establishing effective exchange rate risk management mechanisms.
Just mentioned are the results of our work in the first half of this year and the key direction for our efforts for the second half. Thank you.
_ueditor_page_break_tag_Tianmu News:
In recent years, the deficit of China's cross-border trade in services has continued to narrow. How are you responding to this? Will this deficit increase again in the future?
Wang Chunying:
Trade in services covers many aspects, such as logistics, tourism, intellectual property rights, product processing, financial services, computer information services, and other commercial services. Each kind of trade in services is affected by different factors and projects different growth trends. Since the outbreak of the COVID-19 pandemic, China's cross-border tourism has been primarily affected, but other forms of trade in services have recovered quickly. The prominent features are as follows.
First, the volume of China's cross-border trade in services has surpassed the pre-pandemic level. According to the balance of international payments, China's cross-border services trade balance in 2021 recovered to the 2019 level, and the figure climbed 26% year on year in the first quarter of 2022. Recently, the trade balance of tourism has rebounded due to the demand for overseas study and other factors. Other forms of services trade have also seen steady growth. The trade balance surpassed the 2019 level in 2020, registered a year-on-year increase of 41% in 2021, and continued to rise in the first quarter of this year.
Second, the services trade deficit has narrowed. In the first quarter of this year, the trade deficit of China's tourism sector amounted to $29.4 billion, up by 53% compared with the low level of the same period in 2021, but still lower than the $57.6 billion figure in the same period in 2019. Other services trade has reported a surplus for two consecutive quarters, with the figure in the first quarter of 2022 amounting to $12.8 billion. This is the main reason for the country's narrowing services trade deficit.
Third, China's services trade revenue has increased in recent years, reflecting relevant sectors' improved global competitiveness. China's logistics, computer information, and other commercial services have reported increased export revenue. Specifically, the revenue of logistic services started to grow rapidly in the second half of 2020. This is partly due to the high price of international logistic services. Meanwhile, it also showcases the achievements made by China's logistic sector, which has seized the development opportunities. In the meantime, with the integration of China's manufacturing and service sectors and the digital transformation of its service industry, emerging producer services such as those involved in the commerce and computer information sector is adding new momentum to China's services trade.
In general, the revenue and expense of China's services trade have shown a growing trend since the beginning of this year, with revenue increasing faster, further narrowing the services trade deficit. The development pattern of China's services trade will keep upgrading and changing in the next step. As China's services export competitiveness continues to improve, its services trade revenue will keep growing. Gradually, this will further affect China's services trade deficit.
That concludes my answer. Thank you.
_ueditor_page_break_tag_Yicai:
How do you view the future trend of China's foreign exchange settlement in the context of the substantial rate hike by the Fed? What impact will it have on China's cross-border capital flows? Thank you.
Wang Chunying:
Thank you for your questions. This is an issue of common concern. For the cross-border capital flows of economies other than the U.S., the unconventional monetary policy adjustment of the Fed is an essential external variable and has received much attention. The last time the Fed released signals about tightening its monetary policy was in 2013, almost a decade ago. During this time, China's economy has made historic achievements and realized a higher level of development and opening up. Currently, we are more confident and prepared to mitigate the impact of such monetary policy adjustment on China's cross-border capital flows. China's foreign exchange market is likely to maintain a stable operation. Let's look at our development in this regard over the past decade.
First, China has a greater comprehensive national strength, which can help it better respond to external shocks. In recent years, China's economic development has become more balanced, coordinated, and sustainable. China's GDP in 2021 was 2.1 times that of 2012, and its proportion in the global economy increased from 11% in 2012 to more than 18%. The country's economic power, science and technology prowess and comprehensive national strength have all reached new levels. Recently, China has effectively coordinated epidemic prevention and control while striving for economic and social development, major macroeconomic indicators have rebounded relatively quickly, and the economy has generally maintained a momentum of recovery and development. In June, the manufacturing purchasing managers' index (PMI) was above the 50-point mark that separates contraction from growth, consumption and investment have continued to rebound, and economic growth momentum has increased. With the implementation of various pro-growth policies, China's economy will gradually recover and maintain steady growth in the future.
Second, China's balance of payments is more stable, which can better ensure the stability and security of cross-border capital flows. In recent years, the ratio of China's current account surplus to GDP has been around 2%, and always within a balanced and reasonable range. China stands out among major economies in the world in the balance and stability of its international payments. In addition, China's external asset-liability structure has been gradually optimized and the scale of foreign exchange reserves ranks first in the world; the private sector holds nearly 6 trillion dollars in external assets, and the resources to resist external shocks are more diverse and abundant; foreign debt growth matches economic growth, and the stability has been improved. All the foreign debt indicators are within the internationally recognized safety limit, and the risks are generally controllable.
Third, China has promoted a higher level of opening up, which can better expand the depth and breadth of the foreign exchange market. China's business environment has gradually improved, the negative list for foreign investment has been implemented, and more foreign companies have come to invest and start business in China. Meanwhile, the two-way opening-up of China's financial market has increased the types of entities in the foreign exchange market and the types of sources of funds. The depth and breadth of the foreign exchange market have continued to expand, and it is more capable of absorbing or smoothing out the fluctuations in cross-border capital flows, which is conducive to promoting the overall equilibrium of cross-border capital flows.
Fourth, the foreign exchange market adjustment mechanism becomes more mature, which can better play the role of the RMB exchange rate as an automatic stabilizer for adjusting the balance of payments. In recent years, China has pushed ahead with its market-based RMB exchange rate formation mechanism. The RMB exchange rate has been floated both ways, and its flexibility has been enhanced, which can release external pressures in a timely and effective manner. Moreover, as mentioned just now, the transactions of market entities remain rational and orderly, and expectations are generally stable. Enterprises are also becoming more risk-neutral in exchange rates and can better adapt to two-way fluctuations in exchange rates. Therefore, at present, we are more capable of preventing and defusing the risk of cross-border capital flow through market-oriented means.
In addition, we will follow the impact of the Fed's monetary policy adjustment on the US dollar interest rate, exchange rate, and the international financial market. In fact, the Fed is faced with a dilemma between controlling inflation and stabilizing the economy. We will keep up with how the Fed adjusts the monetary policy in the future. We will further coordinate development and security, pay close attention to external changes, assess the impact in a timely manner, and at the same time promote reform and opening up in foreign exchange in an orderly manner to prepare for effective prevention and mitigation of external shocks. Thank you.
Shou Xiaoli:
Thank you, Ms. Wang and friends from the press. That's all for today's press conference.
Translated and edited by Yang Xi, Li Huiru, Qin Qi, Liu Sitong, Zhang Rui, Wang Wei, Zhu Bochen, Zhang Junmian, Wang Yiming, He Shan, Yan Xiaoqing, Ma Yujia, Zhou Jing, Wang Qian, Xu Xiaoxuan, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Tian Yulong, spokesperson and chief engineer of the Ministry of Industry and Information Technology (MIIT)
Tao Qing, a person in charge of the Bureau of Operation Monitoring and Coordination, MIIT
Wang Peng, a person in charge of the Bureau of Information and Communications Administration, MIIT
Chairperson:
Xing Huina, deputy head of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
July 19, 2022
Xing Huina:
Friends from the media, good morning. Welcome to this press conference held by the SCIO. This is a regular briefing on China's economic data. Today, we are joined by Mr. Tian Yulong, spokesperson and chief engineer of MIIT; Ms. Tao Qing, a person in charge of the Bureau of Operation Monitoring and Coordination of MIIT; and Mr. Wang Peng, a person in charge of the Bureau of Information and Communications Administration of MIIT, to brief you on the development of China's industry and information technology in the first half of 2022, and to take your questions.
Now, let's give the floor to Mr. Tian for his introduction.
Tian Yulong:
Ladies and gentlemen, friends from the media, good morning. I'd like to begin by expressing my heartfelt gratitude to you for your interest in and support for the development of industry and information technology. Next, I'll brief you on the developments in the first half of 2022.
In the first half of the year, MIIT consistently upheld Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implemented the guiding principles of the Central Economic Work Conference and the arrangements in the Government Work Report, and followed the overall requirements set by the central authorities to "contain the pandemic, stabilize the economy, and ensure safe development." We effectively coordinated pandemic prevention and control with economic development, responded to new risks and challenges brought about by changes in both the domestic and international landscapes, and successfully reversed the declining trend in industrial economic indicators. The industrial economy stabilized and rebounded, showing a recovery momentum and giving full play to its role as ballast for the economy.
First, we made every effort to stabilize the industrial economy and restore its growth. In the first half of this year, we resolutely implemented a package of policies and measures introduced by the central authorities to firmly stabilize the economy, and worked with other parties to produce results at a faster pace. There were four highlights among the main economic indicators. First, industrial production stabilized and recovered quite visibly. From January to June, the added value of industries above designated size grew by 3.4% year on year. Growth registered 0.7% in May after dropping to -2.9% in April, and rose quickly to 3.9% in June, showing a V-shaped trend. Second, the manufacturing sector's share in GDP increased significantly. The added value of manufacturing above designated size grew by 2.8% year on year, accounting for 28.8% of GDP, 1.4 percentage points higher than in 2021. Third, exports played a bigger role in driving growth. The export delivery value of industrial enterprises rose by 10.8% in the first six months of the year. Specifically, growth was 11.1% in May and 15.1% in June after falling to 1.9% in April. Fourth, manufacturing investment maintained a high growth rate. Investment in manufacturing increased by 10.4% year on year, with 7.4% coming in the second quarter, 3.2 percentage points higher than the growth rate of fixed asset investment.
Second, we worked hard to keep key industrial and supply chains smooth. Industrial and supply chains are the lifeblood of industrial economy. The new round of COVID-19 outbreaks had a significant impact on industry and supply chains. In the first half of this year, we took effective measures, and promptly established and implemented a nationwide white list system for enterprises centered on key areas, key industries, key companies and key areas of people's livelihoods while also considering anti-pandemic medical supplies, key supplies for strategic industries and other resources, which helped realize cross-departmental and cross-regional linkage and coordination. By encouraging enterprises on key nodes along the chains to resume work and production, and promoting smooth operation of the industrial economy through nodes driving chains and overall development, we solved more than 54,000 problems through the system and achieved remarkable achievements. At present, China's industrial enterprises above designated size, including 22,500 enterprises on the white list, have achieved stable production, strongly supporting the steady growth of the industrial economy.
Third, the resilience of industrial development continued to grow. In the first half of this year, the added value of high-tech manufacturing rose by 9.6% year on year, demonstrating strong resilience and serving as an important engine for high-quality development of the manufacturing industry. Emerging industries have become an important new driving force for promoting transformation and upgrading as well as strengthening industrial resilience. First of all, we vigorously fostered advanced manufacturing clusters and sped up the development of emerging industries including new-type displays, intelligent photovoltaics and new materials. In addition, we encouraged the introduction of three-year action plans for digital transformation of the manufacturing industry, implemented smart manufacturing projects, and accelerated the development of industrial and supply chains for major equipment. Furthermore, we drew up low-carbon technology roadmaps for key industries and carried out green and low-carbon technology transformation. Also, we organized a nationwide campaign to increase the variety and quality of products and nurture domestic brands, and continued to promote a new round of activities encouraging the use of new energy vehicles and green building materials in the countryside, so as to improve supply and stimulate the vitality and potential of consumption.
Fourth, we redoubled efforts to help small and medium-sized enterprises (SMEs) ease difficulties and stabilize operation. Developing SMEs is an important foundation for stabilizing employment and promoting growth, and a vital task for ensuring market entities. In collaboration with relevant departments, we introduced a series of policies and measures to accelerate the implementation of a package of tax and fee reduction policies. In the first half of the year, nearly 1.8 trillion yuan in additional tax and fee cuts, tax refunds, and postponed tax payments were delivered to SMEs. We took solid and special actions to provide services for SMEs, guarded against and cleared arrears owned to them, and promoted integrated innovation among large, medium and small-sized enterprises, among others. To expedite the step-by-step development of high-quality SMEs, we will strive this year to foster around 3,000 "little giants" (specialized and sophisticated SMEs producing new and unique products) and a group of distinctive SMEs industrial clusters. We will organize comprehensive inspections to reduce the burden on enterprises and promote the development of SMEs. We will not only help SMEs ease difficulties and stabilize operation, but also contribute to their steady and sustained development. In general, the added value of SMEs above designated size grew by 3.7% year on year in the first half of this year, faster than the overall industrial growth rate.
Fifth, we have strongly promoted the integrated and innovative development of information and communications. We have stepped up the development of the information and communications industry, and promoted the deep integration of the new generation of information technology with the real economy. In the first half of the year, the information and communications industry developed steadily. The revenue of the telecommunications industry increased by 8.3%. The revenue of the software and information technology service industry is expected to maintain double-digit growth. Investment in fixed assets of telecommunications grew by 24.6% year on year. We have continued to improve the information infrastructure. More than 1.85 million 5G base stations have been built and put into use. We have accelerated the promotion of integrated applications, advancing the construction of fully connected 5G factories. The industrial internet has been widely applied in various fields of the manufacturing industry. We have launched actions to improve information and communications services, further promoted improvements to internet applications for the convenience of senior citizens and made barrier-free facilities available, so as to improve the well-being of all people, including senior citizens and people with disabilities. We have continued to consolidate the foundation of cybersecurity, making more efforts to prevent and address telecommunications and internet fraud, and maintaining the safe and stable operation of the basic telecommunications network.
Ladies and gentlemen, in the first half of the year, China's industrial economy showed strong resilience and development momentum with enterprise vitality being unleashed, which fully proves that the series of economic policies are paying off under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core. We are confident about and capable of dealing with various difficult challenges, and consolidating and maintaining continuous improvements to the overall industrial economy. Next, we will thoroughly implement the decisions and deployments of the CPC Central Committee and the State Council, make stability our top priority, pursue progress while ensuring stability, promote the high-quality development of industry and information technology, and set the stage for the 20th CPC National Congress with concrete actions.
That is all for my introduction. My colleagues and I are now happy to answer your questions.
_ueditor_page_break_tag_Xing Huina:
Thank you, Mr. Tian. Now the floor is open to questions. Please identify the media outlet you represent before asking your questions.
CCTV:
Due to multiple factors including the pandemic and the Ukraine crisis, industrial production was temporarily impacted in the first half of the year, but has generally shown a trend of stabilization and recovery. How do you see industry's role as ballast for the macroeconomy? What measures will MIIT take to boost the performance of industry in the second half of the year? Thank you.
Tian Yulong:
Thank you for your questions. I just briefly introduced the performance of industry as a whole. Generally speaking, China's industry still faced relatively severe and complex internal and external environments in the first half of this year, and all parties involved have made strong efforts to promote stable economic growth. In the first two months of the year, industry experienced a stable start with growth beyond expectations. Since March, industry has suffered a sudden shock, even seeing a large fluctuation. The CPC Central Committee with Comrade Xi Jinping at its core has steered the development course and acted decisively. The State Council issued a package of policies to stabilize the overall economy, which has provided strong support for stable industrial growth with macro policies. MIIT and relevant departments have given greater prominence to stabilizing industrial growth, stepping up the implementation of measures to ensure stable economic growth. All relevant government departments have coordinated to adopt all possible measures and ensure they produce effects early on. Local authorities have also taken on their responsibilities, actively issuing supportive measures and strengthening their implementation. Enterprises have overcome difficulties to operate at full capacity and ensure stable production. Thanks to all these concerted efforts, the total value-added of industrial enterprises above designated size grew by 0.7% and 3.9% in May and June, respectively. It's worth mentioning that the Purchasing Managers' Index (PMI) for China's manufacturing sector rebounded above the 50-point mark indicating economic expansion in June after contracting for three months in a row, which was by no means easy to achieve. The industrial economy has clearly stabilized and rallied, and given full play to its role as ballast for the macroeconomy. I'd like to elaborate from the following aspects:
First, in terms of the proportion of manufacturing in GDP, in the second quarter, the value-added of manufacturing enterprises above designated size accounted for 28.8% of GDP, up 1.4 percentage points over 2021. This is a very favorable signal. In terms of investment contribution, investment in the manufacturing sector increased by 7.4% in the second quarter, which was 3.2 percentage points higher than the growth rate of fixed asset investment, demonstrating the manufacturing sector's role as the engine driving growth. Industrial exports quickly turned from falling to rising, achieving double-digit growth. The equipment manufacturing sector also rebounded rapidly. In June in particular, it contributed more than 70% of overall industrial growth. The strong performance of the equipment manufacturing sector indicates that its role in the industrial system has gradually become apparent.
In general, in the first half of the year, the industrial economy overcame the shocks and pressure, withstood the challenges, and made hard-won achievements. This should be attributed to the strong leadership of the CPC, the institutional strengths of the socialist system, China's complete industrial system and its super-sized domestic market, and in particular, the series of policies issued by the CPC Central Committee and the State Council to stabilize economic growth. As a result, effective investment has continued to expand, consumption potential has been gradually released, and the internal forces powering economic growth have continued to increase. We believe that the industrial economy will continue to recover. The fundamentals of the industrial economy remain unchanged, and they will maintain long-term growth. Of course, we are also soberly aware that in the face of increased pressure both inside and outside of China, weakening global growth and high inflation will inevitably have an effect on trade demand, the stability of global supply chains, and commodity prices. Therefore, the situation we are facing remains complicated, especially in the second half of the year.
Looking forward, we will continue to follow the decisions and arrangements of the CPC Central Committee and the State Council, make economic stability our top priority and pursue progress while ensuring stability. We will put boosting the industrial economy in a more prominent position, and keep major indicators of the industrial economy within the appropriate ranges so as to create a favorable environment for the 20th CPC National Congress. We will adopt the following measures: First, we will accelerate the solid implementation of a package of policies to stabilize the industrial economy. A package of policies to stabilize the economy, especially those to boost the industrial economy, should be fully implemented. We will support local authorities to issue policies and measures which will produce effects earlier and have greater intensity. We will work with relevant departments to strengthen special supervision of efforts to stabilize industrial growth, monitor major indicators such as the investment and proportion of the value-added of the manufacturing sector in GDP, and establish a sound notification system. We will continue to enhance explanations of policies and ensure all kinds of enterprises can benefit from the policies, so as to strengthen their confidence in development, and boost market expectations.
Second, we will encourage more investment and consumption. The 14th Five-Year Plan is already in the works, and a batch of pillar projects and technological upgrade programs have already been launched. The new types of information infrastructure projects should begin as soon as possible, especially in 5G, gigabit optical networks and industrial internet. Meanwhile, we will enhance the driving force to encourage consumer spending. I mentioned earlier the campaign to promote the consumption of quality products nationwide and the programs that bring new energy vehicles and environment-friendly construction materials to rural areas. We will also nurture cities that play a demonstrative role in information consumption. In a word, a series of measures will be taken to promote consumption and investment.
Third, we will keep industrial and supply chains stable and smooth. A crucial step is focusing on key regions, industries and enterprises, and helping enterprises stabilize production and reach the output goals. Regarding the prices of key products, we have established a "red-yellow-blue" three-tier warning system to ensure the supply of major commodities and upstream raw materials. We will also work to ensure the supply of fertilizers during summer, autumn, and winter.
Fourth, we will increase our efforts to help SMEs tide over difficulties. Generally speaking, SMEs still face difficulties in their operation. We will prevent and resolve debt incurred by SMEs through special campaigns, particularly comprehensive inspections, to ease SMEs' burdens and promote their development. We will also improve our service system for SMEs, increase our supportive policies, and provide more precise services. SMEs now need more targeted policies to be implemented and effective. Therefore, we will work on that in the year's second half. Thank you.
_ueditor_page_break_tag_Tianmu News:
You mentioned the digital economy a while ago. The scale of the digital economy has been rising in China, with its proportion to the country's GDP increasing continuously. I wonder what steps will be taken by the MIIT to promote its rapid growth. Thank you.
Wang Peng:
Thank you for your questions. General Secretary Xi Jinping attaches great importance to the development of the digital economy and has made important instructions on several occasions. Following the decisions and arrangements of the CPC Central Committee and the State Council, the Ministry of Industry and Information Technology has sought to work on weaknesses and build the strength of industries, ramped up our innovation capabilities, and has made positive progress in the deep integration of digital technologies and the real economy. China's digital economy has ranked second in the world for years, and its contribution to the country's economic growth has been rising. Let me introduce it briefly from two dimensions. First, the size of the digital economy has expanded continuously. In the first half of the year, the "contactless economy" such as online shopping, online education, and telemedicine saw faster development. The digital economy maintained a sound momentum, injecting strong vitality into economic growth. From January to June, the total revenue of the electronic information manufacturing industry, software industry, communications industry, and the internet surpassed 10 trillion yuan. These industries showed steady and positive momentum, and industry resilience continues to rise. Second, the digital transformation of industries has become faster. We worked to deepen the integration of the new generation of information technology and manufacturing industry, and the industrial internet has seen more solid, innovative development. The "5G+Industrial Internet" 512 Project forged ahead, which already has over 3,100 projects under it, and 700 were newly added in the second quarter of this year. We also implemented the intelligent manufacturing program, nurturing over 6,000 solution providers and covering more than 90% of the manufacturing sector. The numerical control rate of core procedures in industrial enterprises above the designated size reached 55.7%, and the popularization rate of digital research and design tools reached 75.1%. Traditional industries saw the faster process of digital transformation.
Next, the Ministry of Industry and Information Technology will work on the following five aspects to build a sound policy environment for the digital economy.
First, we will work on core technologies to promote the innovation and development of the digital industry. We will thoroughly implement the innovation-driven development strategy, seek to become independent in key and core technologies, make breakthroughs in the bottleneck of crucial sectors, and cultivate competitive companies that can dominate in their respective ecosystems to increase the resilience and competitiveness of industry and supply chains.
Second, we will optimize the internet layout and quicken the development of new types of digital infrastructure. We will actively expand the construction of the 5G network and gigabit optical network as appropriate, implement the innovative development program of industrial internet, and map out the construction of intelligent, environment-friendly data and computing facilities.
Third, we will promote the integration of the digital economy and the real economy, considering the needs of industries. We will extensively carry out the initiatives of the manufacturing sector's digital transformation and SMEs' digital empowerment. We will also expand the application scenarios of industrial big data, cultivate a batch of SMEs with high growth potential, advanced technology and strong market competitive edge as well as single-product specialists in the manufacturing industry, and build a landscape where small, medium, and large-sized enterprises develop together.
Fourth, we will stimulate the vigor and potential of data factors to increase the economy's driving force. We encourage centrally administered state-owned enterprises and internet companies to make transparent their data that are needed by the market. We will also select several regions and industries to carry out pilot programs on the national data management standard to increase data supply nationwide and its quality. We will also issue guidance on data factor application scenarios and ensure the smooth circulation of data factors.
Fifth, we will strengthen the governance of the digital economy to create a healthy ecosystem for its development. We will work on institutions, supervision, and security to improve our governance capabilities in the digital economy. We will deepen international cooperation on the digital economy, join hands to build an open, equal, just, and non-discriminatory environment for the digital economy, and facilitate the building of a community with a shared future in cyberspace. Thank you.
_ueditor_page_break_tag_Xinhua News Agency:
The consumer goods industry is closely linked with people's well-being and is a traditional advantageous industry in China, and it is also the supply foundation for expanding domestic demand. My question is, how will the MIIT promote the high-quality development of the consumer goods industry and increase its role in propping up the entire industrial economy? Thank you.
Tao Qing:
Thank you for the questions. The consumer goods industry covers all aspects of people's lives, including clothing, food, housing, daily necessities, transportation, childcare, education, health care, and elderly care. It also plays a vital role in creating employment, boosting export, and promoting economic growth. Most of China's consumer goods sectors have become market-based. They entered the international market early and have a solid ability to survive. From January to June this year, the value-added of the consumer goods industry increased by 4.6% year on year, demonstrating strong development resilience. Recently, the MIIT, in collaboration with other relevant departments, issued guidelines on the high-quality development of chemical fibers, industrial textiles, and light industries. We also issued policies such as an action plan on leveraging the role of digitalization to help the consumer goods industry increase the variety of products, raise their quality, and build brands. These efforts will deepen the supply-side reform and promote the industry's high-quality development. Going forward, we will focus on increasing the variety of products, raising their quality, and building their brands. We will take measures on both the supply and demand sides, and continuously improve the supply capacity of consumer products and services. We will strengthen areas of weakness, push ahead with industry upgrading, enhance sustainability, promote people's wellbeing, and meet people's needs for a better life.
The first is to promote consumption upgrades through innovative products. Focusing on health care, elderly care, childcare, home life, and other areas related to people's wellbeing, we will encourage enterprises to integrate customization, experience, environmental protection, intelligence, fashion, and other new consumer elements into their product design and manufacturing. We want them to create new demands through innovation and foster new businesses, scenarios, models, and growth engines to meet consumers' needs for multi-level, personalized, high-quality products and services.
The second is to bolster consumer confidence by improving supply. In clothing and textiles, home appliances, food and medicine, and other sectors, we will move faster to build factories demonstrating smart manufacturing, and achieve quality control throughout the life cycle and coordinated development of production, sales, and usage. We will accelerate the building of a quality traceability system for key consumer goods and optimize information inquiry services so that consumers can buy products confidently, use them with peace of mind, and have ever stronger confidence in consumption.
The third is to drive consumption growth with high-quality brands. To further leverage the role of consumption in sustaining growth, in the third quarter, the MIIT focused on the campaign to enhance product variety and quality and create name brands. We organized relevant local governments, departments, industry associations, and e-commerce platforms to hold special promotions, special exhibition tours, and industry activities. The aim was to strengthen the publicity of excellent enterprises and products, launch good products, build brand reputation, and promote stable growth. Thank you!
_ueditor_page_break_tag_The Paper:
The problem of poor connection between industrial production and sales still exists, and enterprises in some sectors face difficulties. What measures will the MIIT take to keep the performance of industry stable? Thank you.
Tao Qing:
Thank you for your question. Unexpected factors at home and abroad have taken a short-term toll on industry since March, but industry has gradually recovered since May with the implementation of policies and measures to stabilize the economy. From the perspective of sectors, the recovery featured several characteristics. First, the production of most sectors has rebounded. Among the 41 major sectors, the value-added of 33 registered positive growth in the first half of the year, of which nine achieved double-digit growth. In May and June, the value-added of 33 and 27 sectors grew faster than the previous month. Second, critical industrial and supply chains recovered at a more rapid pace. After a brief decline in April, the value-added of equipment manufacturing, which was hit hard by the epidemic, returned to positive growth in May, and the growth rate reached 9.2% in June. In particular, the recovery of the industrial and supply chains of the automobile industry was more prominent. With a substantial increase of 16.2% in June, the value-added of automobile manufacturing reversed the previous month's decline of 7%, which effectively drove the overall industrial growth. Third, high-tech manufacturing continued its growth momentum. In the first half of the year, the value-added of high-tech manufacturing increased by 9.6% year on year, significantly higher than that of overall industry. In particular, the value-added of electronics manufacturing increased by 10.2%, maintaining double-digit growth, and the trend of transformation and upgrading remained unchanged. Fourth, some energy and raw material sectors maintained rapid growth. We have redoubled our efforts to keep supply and price stable. In the first half of the year, the value-added of the mining industry increased by 9.5% year on year, of which the growth rate of the coal industry exceeded double digits, and the output of potash fertilizer increased by 9.4%. Fifth, we have taken strong measures to effectively ensure the supply of products essential to people's daily life. In the first half of the year, the value-added of the alcohol, beverages, and refined tea sector increased by 8.4% year on year. The production of food, agricultural and sideline products, and other industries grew steadily, and the supply of daily necessities was adequately guaranteed.
At the same time, we must see that the operation of enterprises in different industries varies due to differences in the industrial development cycle and the epidemic's impact. Some mid- and downstream sectors face pressure from high and fluctuating prices of bulk raw materials and low market demand. The recovery of some consumer goods sectors is lagging. SMEs are still facing difficulties in production and operation. In the next step, we will focus on enterprises and industries with problems, have clear priorities, and take category-based measures. We will facilitate the smooth circulation of industrial and supply chains, move faster to ensure stable production and reach output targets, and step up efforts to ensure the supply and price of energy and raw materials remain stable. We will boost industrial investment and consumption demands, implement targeted policies to ease the difficulties of enterprises, continuously enhance the balance and stability of the recovery and development of industry, and continue to consolidate the foundation for industry's steady recovery. Thank you!
_ueditor_page_break_tag_BeijingNews.com.cn:
The new energy vehicle (NEV) industry is a bright spot in the year's first half. Earlier, the MIIT said it was studying whether to continue the preferential policies of purchase tax for NEVs. Is there any progress made in this regard? What is the next step to promote the consumption of NEVs? Thank you.
Tian Yulong:
Thank you for your questions. This year, the development of the NEV industry has attracted wide attention. As it is closely related to the life of ordinary people, our enterprises have overcome the epidemic's impact to achieve steady and rapid development, which is also noticeable worldwide. There are three main highlights:
First, the production and sales have reached a new high. The latest data showed that 590,000 vehicles were produced and 596,000 were sold in June, each rising 1.3 times year on year. The numbers reached 2.661 million and 2.6 million respectively in the first half of this year, both up 1.2 times year on year. The production and sales scale has hit a record high, with a market penetration rate of 21.6 percent.
Second, fresh breakthroughs have been made in technological innovation. The newly developed laser radar, homemade chips, and vehicle-borne basic computing platforms have been loaded into vehicles, with technological innovation constantly improving. Batteries have also witnessed breakthroughs with such highlight indicators: the energy density of mass-produced ternary batteries reached the world's highest level of 300 Wh/kg, and cobalt-free batteries topped 240 Wh/kg. Semi-solid-state batteries are close to mass production; therefore, we have strong competitiveness in NEV power batteries.
Third, the upgrading of supporting systems has been accelerated. In the first half of this year, 1.3 million new charging/ battery swap facilities were added, up 3.8 times year on year, including 920,000 private EV charging piles and 380,000 public ones. The building of public facilities is critically important as the demand for NEVs is growing stronger. More than 10,000 power battery recycling service sites have been built, realizing the nearby recovery of retired batteries, which is convenient for users.
The issue of the purchase tax exemption you have mentioned is of public concern and highly valued by the State Council. The Standing Committee of the State Council has asked the relevant departments to study the issue of extension of the purchase tax exemption for NEVs in light of the actual situation. Currently, the relevant departments are expediting studies to release the relevant policies as soon as possible.
In general, China's NEVs have entered a rapid stage of development. Stabilizing and expanding NEV consumption is a significant way to ensure the stable development of the automobile industry, which is also an important part of our work in the future. In accordance with the decisions and arrangements of the CPC Central Committee and the State Council, we will work with relevant departments to further expand NEV promotion to boost automobile consumption, contributing to the overall stability of the economy. Our work will focus on the following aspects. First, we will continue to improve the quality of products by constantly improving the technical safety standards of NEVs, raising the performance level of the related power batteries, including out-of-control alarm, safety protection, low-temperature adaptability, and other performance levels, so that consumers can buy and use them with confidence. At the same time, we should accelerate the integrated development of electrification and intelligent networking and develop more services that can meet consumers' needs, to improve the driving experience and add a modern touch. On the other hand, we should create a favorable environment for use, strengthen industrial monitoring, and strive to keep the supply and prices of automobile chips and upstream raw materials stable, which will have a great impact on the automobile industry. We will ensure stable supply and prices and make every effort to keep industrial and supply chains stable and smooth. We will implement the State Council's requirement to steadily boost the consumption of automobiles and other bulk commodities and encourage localities and regions where conditions permit to introduce substantive policies to boost consumption. We will make concerted efforts to organize a new round of campaigns to promote NEVs in rural areas, electrify all public facilities in pilot cities, accelerate the construction of charging/ battery swap facilities, foster information sharing and unified settlement to coordinate NEVs consumption, safe driving and the stable development of the whole industry. Thank you.
_ueditor_page_break_tag_PPTN (People's Posts and Telecommunications News):
In recent years, the industrial internet has played an important role in helping enterprises resume work and production and promoting digital transformation. What progress has been made in the integrated application of the industrial internet during the first half of this year? What plans and measures will be taken in the year's second half?
Wang Peng:
Thanks for your questions. The CPC Central Committee and the State Council attach great importance to the development of the industrial internet. This year marks the fifth year for us to implement General Secretary Xi Jinping's important instructions and further carried out the innovative development strategy of the industrial internet. Generally speaking, the systematic development of China's industrial internet has achieved remarkable results, which provided strong support for the digital transformation of the economy and society.
Since the beginning of this year, we have accelerated the development of the industrial internet in accordance with the requirements of the central government's work report, and made new progress in all aspects. I will give you a brief introduction from the following four aspects. First, the network has a more solid foundation. The number of "5G+Industrial Internet" national projects increased by 700 in Q2, bringing the total number to over 3,100. An analysis system for industrial internet identification has been basically constructed. The average daily resolution volume of national top-level nodes increased significantly, reaching 150 million. The second-level nodes have covered 34 key industries and 29 provincial-level regions across the country. Second, the platform system is blooming. More than 150 featured platforms with industrial and regional influence have been established, and 28 cross-industry and cross-field industrial internet platforms have been selected. The number of industrial equipment connected to key platforms now exceeds 79 million, and the number of industrial apps exceeds 280,000. Third, the security guarantee has been optimized simultaneously. A technical monitoring and service system has been basically established to coordinate work at the national and provincial levels as well as those to do with enterprises, and its institutional construction, technical means, and service capability have been improved simultaneously. Fourth, integration and empowerment have been accelerated. The industrial internet has been applied in 45 major national economic categories and has been constructed in industrial bases, industrial parks, and key enterprises. Its industrial scale exceeded one trillion yuan, which empowers the capabilities, value, and wisdom across all industries.
Next, we will resolutely implement the decisions and arrangements of the CPC Central Committee and the State Council, issue new policy measures for specific guidance, and upgrade the industrial internet. Efforts will be made in the following three aspects. First, we will focus on key links in industries and enhance our innovation capacity. We will further carry out innovation and development projects of the industrial internet, promote the integration of industrial internet demonstration projects, and concentrate on equipment connectivity, data innovation and application, equipment and platform security, and other key areas. A number of demonstration projects will be arranged, a series of urgently-needed standards will be formulated, and a batch of landmark results will be spread. Second, we will focus on key transformation areas and widen industrial applications. Factories fully connected with 5G in key industries will be constructed to accelerate the expansion of 5G from a supporting role during production to a core role. We will establish digital transformation centers of the industrial internet, improve the layout of public service innovation carriers, and accelerate large-scale applications and promotion. A series of application reference guides and safety protection guides will be compiled for different industries to provide guidance for enterprises. Third, we will focus on the application ecosystem and strengthen the synergy between supply and demand. "5G+Industrial Internet" on-site meetings will be organized for both information and communication enterprises and industrial enterprises to work together. In-depth activities will be increased to promote industrial internet applications in industrial parks and county economies. We will give full play to the industrial internet working group and take multiple measures to deepen industry-finance cooperation and industry-education integration. Thank you.
_ueditor_page_break_tag_China Daily:
Due to the impact of the international environment and the domestic COVID-19 epidemic, downward pressure on the economy has continued to mount this year. However, we have noticed that the information and telecom industry has maintained overall stability and become a bright spot for economic development in H1. Please give us an introduction to the development of the information and telecom industry. Thank you.
Wang Peng:
Thanks for your question. In H1, we earnestly implemented the decisions and arrangements of the CPC Central Committee and the State Council, remained committed to the general principle of pursuing progress while ensuring stability, and tried our best to overcome the impact of the epidemic. We accelerated the integration of information and telecom technology through all sectors of the economy and society, and consolidated healthy trends toward stable growth for the industry.
First, emerging growth drivers continued to grow. In H1, the total volume of the telecom businesses grew by 22.7% year on year, and their revenue increased by 8.3%, 5.8 percentage points higher than GDP growth, contributing significantly to economic growth. The industry structure has been optimized, and emerging businesses, including internet data centers, big data, cloud computing, and the Internet of Things became important driving forces. In H1, the revenue of emerging businesses reached 162.4 billion yuan, up 36.3% year on year, accounting for 19.9% of the entire industry. The industrial transformation has achieved remarkable results.
Second, our supporting role became prominent. From the vantage point of network construction, infrastructure stayed ahead. The integration of a "double gigabit" network further advanced, covering 400 million households with gigabit optical fiber networks. A total of 1.854 million 5G base stations were established and opened, 300,000 of which were newly opened in Q2. We made the realization of "5G access to every county and broadband access to every village." The number of national-level internet backbone direct connection points reached 19, while network delay and packet loss rates dropped significantly. From the vantage point of serving social development, the empowerment of integrated application accelerated. We sped up the integrated application of 5G and gigabit optical fiber networks in industry, medical care, education, transportation, and other fields. The number of 5G application cases exceeded 20,000. The industrial internet has been expanded in industrial clusters, green, low-carbon, safe production, and other sectors, creating many new benchmarks at the workshop level, enterprise level, and cluster level.
Third, domestic demand has been expanded to help unleash potential. In terms of investment, in H1, fixed-asset investment in telecommunications reached 189.4 billion yuan, up 24.6% year on year, 18.5 percentage points higher than the national growth rate of fixed-asset investment (excluding rural households), which created new growth in communication manufacturing, internet, and software services amid the epidemic. In terms of consumption, mobile internet traffic increased by 20.2% year on year. Online applications such as online office work, livestreaming, online food delivery, and short videos flourished, and information consumption continued to expand and upgrade.
Fourth, digital facilities to benefit the people have become more robust. It is mainly reflected in the following three improvements. First, user service awareness has been improved, and basic telecom enterprises have realized cross-regional handling of common telecom services such as the "Family Network." Meanwhile, 33 key internet companies have established manual customer service hotlines, and 137 companies are connected to the internet information service complaint platform. Second, information accessibility has improved, and the aging-friendly transformation of internet applications has been further advanced. For example, 452 websites and apps completed the aging-friendly transformation and passed the test and evaluation. Third, the protection of user rights and interests has been improved, and a total of 6.3 million app tests have been completed, realizing the full coverage of apps on the shelves of mainstream application stores in China, and app management capabilities have been significantly enhanced.
Next, the MIIT will continue to accelerate network construction and integrate innovative applications following the decisions and arrangements of the CPC Central Committee and the State Council and continuously promote the high-quality development of the information and communication industry. The first is to clear the information artery, deepen the joint construction and sharing of 5G, and continue to improve the depth and breadth of "dual-gigabit" network coverage. We will continue to promote universal telecom services and strive to build 600,000 5G base stations this year, with more than 2 million total. The second is to cultivate new momentum for development. We will accelerate the promotion and upgrading of the industrial internet, promote the pilot demonstration of the industrial internet in an integrated manner, and implement the "10, 100, and 1000" program of 5G industry applications. This will mean selecting 10 vertical industries, with each industry forming 100 benchmarks, and building 1,000 5G industry virtual private networks, to help the digital transformation of the industry. The third is to enhance people's sense of gain. We will further implement the aging-friendly transformation and upgrading projects on internet applications, strengthen the protection of the rights and interests of telecom and internet users, further regulate the operating behavior of basic telecom companies and internet companies, and create a favorable environment for information consumption. The fourth is to build up a safety fence. We will improve the capabilities of internet service and emergency response, strengthen cybersecurity guarantee, improve the security management system in the integrated fields of the industrial internet and the internet of vehicles (IoV), and promote the accelerated development of cyberspace security industry. Thanks!
_ueditor_page_break_tag_Yicai:
The stability of the industrial and supply chains is crucial for recovering the industrial economy. What measures has the MIIT taken in the first half of this year to ensure the stability and smoothness of the industrial and supply chains? In the second half of the year, what other considerations are there in promoting enterprises to reach stable production and reach the target output? Thank you.
Tao Qing:
Thank you for your questions. The industrial and supply chains are the backbone and blood vessels of the industrial economy. Since March, they have been affected by the COVID-19 epidemic and other factors. The supply chain and the industrial chain have faced many blockages, causing some industrial enterprises to stop work and production. The MIIT resolutely implements the decisions and arrangements of the CPC Central Committee and the State Council, following the overall requirements of preventing the epidemic, stabilizing the economy, and developing safely, and regards a smooth industrial chain and supply chain as the primary task for ensuring stable industrial growth, and has taken a series of measures in conjunction with relevant departments and localities to make every effort to ensure the stable and smooth industrial chain and supply chain.
First, we are focusing on key areas and sparing no effort to get through the blocking points. We first established a daily scheduling mechanism for key provinces and cities to coordinate and solve problems such as obstruction of logistics and transportation and poor connection between upstream and downstream. We dispatched front-line working groups to strengthen cross-regional coordination, and perform closed-loop management and stabilize production under the conditions of ensuring epidemic prevention and control in key regions.
Second, we focus on key enterprises to establish and implement a "white list" system. Focusing on key fields such as medical and epidemic prevention materials, necessities of life for residents, important materials for agricultural production, and key materials for strategic industries, we have released a "white list" of key enterprises to unblock key nodes in the industrial chain and supply chain. At the same time, we have guided more than 20,000 companies on the white list in various regions to achieve regional mutual recognition and promote the coordinated resumption of work and production.
Third, we are focusing on key industries and promoting the upstream and downstream to dock their services. We have built a coordination platform for key industrial chains and supply chains for automobiles, integrated circuits, medical supplies, etc., established a "red light" early warning mechanism for auto companies whose spare parts inventory can last less than three days, and established a "red, yellow and blue" early warning coordination mechanism for bulk raw material supply, etc.. We did these in order to solve the problems reported by enterprises one by one, such as raw material supply, employees returning to work, as well as logistics and transportation issues. Just as Mr. Tian introduced, the national industry and information system have coordinated and solved more than 54,000 problems and demands from enterprises in a timely manner, helping the upstream and downstream to resume work and production synchronously.
With the joint efforts of various regions and departments, the industrial chain and supply chain have become increasingly smooth, and the industrial economy has quickly reversed the downward trend and achieved growth recovery. At present, industrial enterprises above the designated size in the Yangtze River Delta and Pearl River Delta regions have resumed normal production, and the production capacity of key industrial chains such as automobiles and integrated circuits has also fully recovered. In the next step, the MIIT will thoroughly implement the decisions and arrangements of the CPC Central Committee and the State Council, efficiently coordinate epidemic prevention and control and industrial production, and further promote enterprises to stabilize the production and reach the target outputs. First, we will strengthen the monitoring of the operation of key regions, key industries, and key enterprises. Based on the whitelist enterprises in the key industrial chains and supply chains, we will pay close attention to ensuring the implementation of details of various service guarantees and promote key enterprises to stabilize the production and reach the target outputs, which will see a full recovery of production capacity. Second, we will guide the regions where the epidemic occurs to implement the COVID1-19 prevention and control measures in the production process, effectively implement the stable production plan and emergency plan, and ensure stable production under the conditions of epidemic prevention and control. After the impact and experiences in March and April, many enterprises and localities promptly formed their own emergency plans. We are also very confident that we can quickly achieve closed-loop management and stable production under any shock waves. Third, we will further improve the coordination platform of key industrial chains and supply chains and improve the "red, yellow, and blue" early warning coordination mechanism for the supply and demand of bulk commodities. We will strengthen the supply of automotive chips, promote inter-regional, upstream-and-downstream coordination and interaction, and ensure key industrial chains and supply chains are stable and smooth, such as automobiles and integrated circuits. Thank you!
_ueditor_page_break_tag_Southern Metropolis Daily:
Some micro-, small- and medium-sized enterprises (MSMEs) that COVID-19 has severely hit are facing greater difficulties in operation. What measures have you taken to support MSMEs in the year's first half, and what are the next steps? Thank you.
Tian Yulong:
Thank you for your question. As you said, MSMEs have always drawn public attention. They have been affected by the epidemic and the combination of various factors. The CPC Central Committee and the State Council have attached great importance to the issue and made a series of policies intensively. You may have seen them in the newspapers. These combined policies include tax incentives, improvement of the standard of subsidies given to businesses that reduce layoffs, solving financing problems, and reduction and exemption of property fees and rent. These measures have played a significant role in the relief and assistance of MSMEs. According to the latest data, as of June 25, China's tax refunds, as well as tax and fee cuts and deferrals, reached 2.58 trillion yuan, with the beneficiaries being MSMEs. The CPC Central Committee and the State Council have relieved the burden on MSMEs so they can tide over difficulties.
As a department responsible for providing comprehensive service for small- and medium-sized enterprises (SMEs), the MIIT and relevant departments have implemented the deployment of the CPC Central Committee and the State Council and taken multiple measures to help MSMEs overcome difficulties. Now we can see that these measures work well.
First, we have promoted introducing and implementing various policies that benefit enterprises. The State Council's leading group on developing SMEs has held several meetings to study relevant issues. "Several Measures to Help Micro-, Small- and Medium-Sized Enterprises Relieve Difficulties," which comprises 10 specific measures in four areas, was issued by the MIIT to solve the problems faced by MSMEs. At the same time, we have implemented the measures issued by the State Council to stabilize the economy and further strengthen the relief and support for MSMEs. All regions and departments have worked together to implement measures and policies so that MSMEs can get the benefits as soon as possible and have a sense of fulfillment. Meanwhile, we will work with relevant departments to carry out comprehensive inspections on implementing these policies and reduce the burden on enterprises, promote and guide local governments to increase the implementation of policies, benefit MSMEs, help them overcome difficulties, and develop as soon as possible.
Second, we have mobilized the forces of all parties to increase services for SMEs. The key to the implementation of the policy is to provide good service. We have launched two campaigns nationwide: one is "Service Month for SMEs," and the other is "Benefiting Enterprises Together." In collaboration with local authorities, we have made known these preferential policies to enterprises, industrial parks, and industrial clusters to ensure that MSMEs can have access to the policies, technologies, and management techniques so that their businesses can recover from a difficult situation as soon as possible. From January to June, various SME service agencies organized multiple activities such as policy publicity, coordination, and assistance. More than 20 million services have been delivered, showing our considerable efforts in this field. Businesses can feel the benefits and have a better sense of fulfillment.
Third, we have focused on improving the ability of SMEs. We should not only help them solve difficulties but also promote their long-term development. The development of SMEs is also vital in stabilizing employment and economic growth. We have established a system for cultivating SMEs of various types in phases, including innovative SMEs, specialized and sophisticated SMEs that produce new and unique products , and "little giants" (small enterprises in their early stage of development and focusing on high-end technologies). We have carried out a campaign, "Act Together," to promote the cooperation of large enterprises and SMEs in the upstream and downstream so that they can make progress together. MSMEs have accelerated technological transformation and digitalization to enhance their core competitiveness and technological innovation capabilities. Recently, together with the Ministry of Education and China National Intellectual Property Administration, the MIIT launched a campaign to promote cooperation between colleges and universities and MSMEs and sped up the commercialization and application of technological achievements made in colleges and universities. These efforts are of great significance, enabling SMEs to have more sources of innovation and receive more support.
Fourth, efforts have been intensified to get outstanding payments owed to SMEs cleared. We have focused on this work in recent years. By carrying out certain actions to prevent and resolve overdue payments, we have focused on resolving existing arrears while strictly preventing new arrears. We have constantly been improving long-term mechanisms and established relevant channels for handling complaints concerning outstanding payments in all provinces to ensure that SMEs have convenient access to make a complaint and get timely responses. We have improved the mechanism of complaint acceptance and transfer, follow-up, and supervision and protected MSMEs' legitimate rights and interests.
Next, we will scale our efforts in the above four areas and work with relevant departments to implement policies and measures, mobilize resources and strengths from all parties, and strengthen publicity and services. We will pay close attention to the development of SMEs and make policy reserves. We will continuously improve the service system and improve the service level. We will combine aiding and cultivating SMEs to encourage them to innovate, transform, upgrade, improve quality and efficiency, and grow stronger. We will strengthen the protection of SMEs' rights and interests so that they can overcome the current difficulties as soon as possible and achieve stable and healthy development. This is the top priority of our current and future work, and we hope to receive strong support from all walks of life. Thank you.
Xing Huina:
If you don't have any more questions, that's all for today's press conference. Thank you to the three speakers and friends from the media. Goodbye, everyone.
Translated and edited by Zhang Liying, Chen Xia, Zhang Tingting, Liu Qiang, Zhang Rui, Liu Sitong, Wang Yiming, Li Huiru, Wang Qian, Xu Xiaoxuan, Yang Xi, Huang Shan, Zhang Lulu, Lin Liyao, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speaker:
Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and director general of the Department of Comprehensive Statistics of the NBS
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
July 15, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the SCIO. Today, we will continue the regular release of economic data. We have invited Mr. Fu Linghui, spokesperson of the NBS and director general of the Department of Comprehensive Statistics of the NBS, who will introduce China's economic performance in the first half of 2022 and answer your questions.
Now, I would like to give the floor to Mr. Fu for his introduction.
Fu Linghui:
Friends from the media, good morning. As per usual practice, I will first brief you on the main economic indicators and the performance of the national economy in the first half of 2022, and then answer your questions.
Strong measures have been adopted to counter the impact of unexpected factors, and the national economy has registered a stable recovery.
Since the beginning of this year, the increasingly complicated and challenging international environment, as well as multiple, sporadic domestic outbreaks of COVID-19, have led to extremely unusual economic development with a significant increase in adverse impacts. The economy in the second quarter was under noticeable downward pressure with serious impacts from unexpected factors. Faced with extreme complexities and difficulties, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, all regions and departments thoroughly implemented the decisions and arrangements made by the CPC Central Committee and the State Council, effectively coordinated COVID-19 countermeasures with economic and social development, stepped up macro policy adjustments, and effectively implemented a package of policies and measures to boost stability. As a result, the resurgence of the pandemic was contained, the national economy registered a stable recovery, production and demand saw improving margins, market prices were generally stable, people's livelihoods were sufficiently protected with robust steps, the momentum of high-quality development was sustained and overall social stability was maintained.
1. The national economy realized positive growth in the second quarter despite downward pressure.
Major economic indicators plunged in April. Faced with new growing downward pressure, the CPC Central Committee and the State Council made sound decisions and took timely measures, implemented the policy measures of the Central Economic Work Conference and the Government Work Report early on, instead of deploying indiscriminate stimulus spending, rolled out a package of pro-stability policy measures according to the general guidelines and policy direction, and held a national teleconference to make arrangements on maintaining stable macroeconomic performance. The policies soon took effect. The decline of major economic indicators narrowed in May. The economy registered a stable recovery in June and achieved positive growth in the second quarter. According to preliminary estimates, China's gross domestic product (GDP) in the first half of the year was 56.26 trillion yuan, up by 2.5% year on year at constant prices. By industry, the value added of the primary industry was 2.91 trillion yuan, up by 5% year on year; the secondary industry 22.86 trillion yuan, up by 3.2%; and the tertiary industry 30.49 trillion yuan, up by 1.8%. Specifically, GDP for the second quarter was 29.25 trillion yuan, up by 0.4% year on year. By industry, in the second quarter, the value added of the primary industry was 1.82 trillion yuan, up by 4.4% year on year; the secondary industry 12.25 trillion yuan, up by 0.9%; and the tertiary industry 15.18 trillion yuan, down by 0.4%.
2. Summer grain witnessed a bumper harvest and animal husbandry grew steadily.
In the first half of this year, the value added of agriculture (crop farming) grew by 4.5% year on year. The overall output of summer grain was 147.39 million metric tons, 1.43 metric million metric tons higher than that of last year, an increase of 1%. The structure of crop farming continued to be optimized, as the sown area for cash crops like rapeseed increased. In the first half of this year, the output of pork, beef, mutton and poultry was 45.19 million metric tons, up by 5.3% year on year. Specifically, the outputs of pork, beef and mutton rose by 8.2%, 3.8% and 0.7%, respectively, and poultry was down by 0.8%; that of milk rose by 8.4% and eggs increased by 3.5%. In the second quarter, the output of pork, beef, mutton and poultry increased by 1.6% year on year, of which pork was up by 2.4%. By the end of the second quarter, the number of pigs registered in stock was 430.57 million, down by 1.9% year on year, among which 42.77 million were breeding sows; and 365.87 million pigs were slaughtered, up by 8.4%.
3. Industrial production steadily recovered and high-tech manufacturing enjoyed fast development.
In the first half of this year, the total value added of industrial enterprises above designated size grew by 3.4% year on year. In terms of sectors, the value added of mining increased by 9.5% year on year; that of manufacturing increased by 2.8%; and the production and supply of electricity, thermal power, gas and water increased by 3.9%. The value added of high-tech manufacturing went up by 9.6% year on year, 6.2 percentage points higher than that of industrial enterprises above designated size. In terms of ownership, the value added of state holding enterprises grew by 2.7% year on year, that of share-holding enterprises grew by 4.8%, that of enterprises funded by foreign investors and investors from Hong Kong, Macao and Taiwan fell by 2.1%, and that of private enterprises grew by 4%. In terms of products, the production of new-energy automobiles, solar cells and mobile communication base stations grew by 111.2%, 31.8% and 19.8% year on year, respectively.
In the second quarter, the total value added of industrial enterprises above designated size was up by 0.7% year on year. Specifically, that in April went down by 2.9% year on year; that in May shifted from negative to positive and was up by 0.7%; and that in June increased by 3.9%, 3.2 percentage points higher than that of the previous month, or up by 0.84% month on month. In June, the Manufacturing Purchasing Managers' Index stood at 50.2%, 0.6 percentage point higher than that of the previous month; and the Production and Operation Expectation Index was 55.2%, 1.3 percentage points higher than that of the previous month. In the first five months, the total profits made by industrial enterprises above designated size was 3.44 trillion yuan, up by 1% year on year.
4. The service sector gradually recovered and modern service industries witnessed good growth momentum.
In the first half of this year, the value added of services went up by 1.8% year on year. Of this total, that of information transmission, software and information technology services and that of financial intermediation grew by 9.2% and 5.5%, respectively. In the second quarter, the value added of services was down by 0.4% year on year. The Index of Services Production in April was down by 6.1% year on year; the decline in May narrowed to 5.1% and that in June shifted from decline to an increase of 1.3%. In the first five months, business revenue of service enterprises above designated size grew by 4.6% year on year, 0.4 percentage point higher than that of the first four months. In June, the Business Activity Index for services was 54.3%, 7.2 percentage points higher than that of the previous month. Specifically, the Business Activity Index for retail sales, railway transportation, road transportation, air transportation, postal services, monetary and financial services and capital market services stayed within the expansion rage of 55% and above. In terms of market expectation, the Business Activity Expectation Index for services was 61%, 5.8 percentage points higher than that of the previous month.
5. Market sales improved and retail sales of goods for basic living grew fast.
In the first half of this year, the total retail sales of consumer goods reached 21.04 trillion yuan, down by 0.7% year on year. Analyzed by area, the retail sales in urban areas reached 18.27 trillion yuan, down by 0.8%, and the retail sales in rural areas stood at 2.77 trillion yuan, down by 0.3%. Grouped by consumption patterns, the retail sales of goods reached 19.04 trillion yuan, up by 0.1%; and the income of catering was 2 trillion yuan, down by 7.7%. The consumption of goods for basic living grew steadily. The retail sales of grain, oil and food and that of beverages by enterprises above designated size grew by 9.9% and 8.2%, respectively. Online retail sales totaled 6.3 trillion yuan, up by 3.1%. Specifically, the online retail sales of physical goods were 5.45 trillion yuan, up by 5.6%, accounting for 25.9% of the total retail sales of consumer goods. In the second quarter, the total retail sales of consumer goods went down by 4.6% year on year. Specifically, that in April was down by 11.1% year on year; the decline in May narrowed to 6.7%; and that in June shifted from decline to an increase of 3.1% year on year, or up by 0.53% month on month.
_ueditor_page_break_tag_6. Investment in fixed assets continued to grow and investment in high-tech industries and social sectors grew fast.
In the first half of this year, the investment in fixed assets (excluding rural households) reached 27.14 trillion yuan, up by 6.1% year on year. Specifically, in the first half of this year, the investment in infrastructure was up by 7.1%, manufacturing up by 10.4%, and real estate development down by 5.4%. The floor space of commercial buildings sold reached 689.23 million square meters, down by 22.2%; the total sales of commercial buildings was 6.61 trillion yuan, down by 28.9%. By industry, investment in the primary industry went up by 4%, the secondary industry up by 10.9%, and the tertiary industry up by 4%. Private investment was up by 3.5%. The investment in high-tech industries grew by 20.2%, of which the investment in high-tech manufacturing and high-tech services increased by 23.8% and 12.6%, respectively. In terms of high-tech manufacturing, the investment in the manufacturing of electronic and communications equipment and in the manufacturing of medical equipment, measuring instruments and meters grew by 28.8% and 28%, respectively. In terms of high-tech services, the investment in services for transformation of scientific and technological achievements and in research, development and design services went up by 13.6% and 12.4%, respectively. The investment in social sectors went up by 14.9%, among which, investment in health and education went up by 34.5% and 10%, respectively. In the second quarter, the investment in fixed assets (excluding rural households) witnessed a year-on-year increase of 4.2%. Specifically, the growth rate was 1.8% in April, accelerated to 4.6% in May and rebounded further to 5.6% in June. In June, investment in fixed assets (excluding rural households) went up by 0.95% month on month.
7. Imports and exports of goods grew fast and the trade structure continued to be optimized.
In the first half of this year, the total value of imports and exports of goods was 19.8 trillion yuan, an increase of 9.4% year on year. The total value of exports was 11.14 trillion yuan, up by 13.2%. The total value of imports was 8.66 trillion yuan, up by 4.8%. The trade balance was 2.48 trillion yuan in surplus. The imports and exports of general trade increased by 13.1%, accounting for 64.2% of the total value of the imports and exports, 2.1 percentage points higher than that of the same period last year. The imports and exports by private enterprises increased by 13.6%, accounting for 49.6% of the total value of imports and exports, 1.9 percentage points higher than that of the same period last year. The imports and exports of mechanical and electronic products increased by 4.2%, accounting for 49.1% of the total value of the imports and exports. In June, the total value of imports and exports was 3.77 trillion yuan, an increase of 14.3% year on year. The total value of exports was 2.21 trillion yuan, up by 22%. The total value of imports was 1.56 trillion yuan, up by 4.8%.
8. Consumer price saw mild growth and growth of producer prices for industrial products continued to decline.
The consumer price index (CPI) went up by 1.7% year on year in the first half of this year. Grouped by commodity categories, prices for food, tobacco and alcohol were up by 0.4% year on year; clothing up by 0.5%; housing up by 1.2%; articles and services for daily use up by 1%; transportation and communication up by 6.3%; education, culture and recreation up by 2.3%; medical services and health care up by 0.7%; and other articles and services up by 1.2%. In terms of food, tobacco and alcohol prices, prices for pork went down by 33.2%, grain up by 2.4%, fresh fruit up by 12% and fresh vegetables up by 8%. Core CPI excluding the prices of food and energy went up by 1%. In the second quarter, the CPI went up by 2.3% year on year. Specifically, it increased by 2.1% year on year in both April and May, rose by 2.5% year on year, and maintained the same level of growth month on month in June.
In the first half of this year, the producer prices for industrial products went up by 7.7% year on year, with year-on-year growth of 6.8% in the second quarter. Specifically, prices grew by 8% in April and 6.4% in May year on year; up by 6.1% year on year and maintained the same level of growth month on month in June. The purchasing prices for industrial producers went up by 10.4% year on year in the first half of this year, and up by 9.5% year on year in the second quarter. Specifically, prices grew by 10.8% in April and 9.1% in May year on year; up by 8.5% year on year and 0.2% month on month in June.
9. Employment trends improved and the surveyed unemployment rate in urban areas fell.
In the first half of this year, the newly increased employed people in urban areas totaled 6.54 million. The surveyed unemployment rate in urban areas averaged 5.7% in the first half of this year and 5.8% in the second quarter. In April, the surveyed unemployment rate in urban areas was 6.1%, with consecutive declines of 5.9% in May and 5.5% in June. In June, the surveyed unemployment rate of population with local household registration was 5.3% and that of population with non-local household registration was 5.8%, of which that of population with non-local agricultural household registration stood at 5.3%. Specifically, the surveyed unemployment rates of the population aged from 16-24 and from 25-59 were 19.3% and 4.5%, respectively. The urban surveyed unemployment rate across 31 major cities was 5.8%, 1.1 percentage points lower than May. Employees of enterprises worked on average 47.7 hours per week. By the end of the second quarter, the number of rural migrant workers totaled 181.24 million.
10. Residents' incomes steadily increased and the urban-rural per capita income ratio narrowed.
In the first half of this year, the nationwide per capita disposable income of residents was 18,463 yuan, a nominal increase of 4.7% year on year. Real growth was 3% after deducting price factors. In terms of permanent residence, the per capita disposable income of urban households was 25,003 yuan, a nominal growth of 3.6% and a real growth of 1.9% year on year. The per capita disposable income of rural households was 9,787 yuan, a nominal growth of 5.8% and real growth of 4.2% year on year. By sources of income, nationwide per capita salary income, net business income, net property income and net income from transfers witnessed nominal growths of 4.7%, 3.2%, 5.2% and 5.6%, respectively. The per capita income of urban households was 2.55 times that of rural households, 0.06 less than the same period last year. Median nationwide per capita disposable income was 15,560 yuan, a nominal increase of 4.5% year on year.
Generally speaking, with a series of policies to solidly stabilize the economy achieving notable results, the national economy has overcome the adverse impact of unexpected factors, demonstrating stable recovery momentum. The second quarter, in particular, witnessed positive economic growth and stable macroeconomic performance was maintained, which are hard-earned achievements. However, we should be aware that the foundation for the sustainable and steady recovery of the economy is yet to be consolidated. Externally, this is due to the rising risk of stagflation in the world economy, a trend toward the tightening of policies by major economies, and an obvious increase in instabilities and uncertainties. Meanwhile, domestically, the impact of the epidemic is lingering, shrinking demand is intertwined with disrupted supply, structural problems are combined with cyclical problems, and market entities still face difficulties operating. In the next stage, we must follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, apply the new development philosophy in full, in the right manner and in all fields, follow the requirements for containing the epidemic, stabilizing the economy and keeping development secure, respond to COVID-19 and pursue economic and social development in a coordinated manner, take advantage of the critical period of economic recovery, adopt strong measures to promote the implementation of a package of policy measures to maintain a stable economy, continue to ensure stability on six fronts and maintain security in six key areas, continue to enhance efficiency, stimulate vitality and add impetus, and constantly consolidate the foundation for a steady economic recovery to keep major economic indicators within the appropriate ranges.
_ueditor_page_break_tag_Shou Xiaoli:
Thank you, Mr. Fu. Now the floor is open for questions. Please identify your news outlet before asking your question.
Phoenix TV:
The Chinese economy slowed down in the second quarter due to a heavy blow from the pandemic. What are your views on this? Will the Chinese economy be able to sustain a recovery? Thank you.
Fu Linghui:
Thank you for your questions. In the second quarter, such unexpected factors as complex changes in the international environment and the resurgence of COVID-19 cases at home have put the Chinese economy under much greater downward pressure. In light of this, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, all regions and departments have worked to coordinate pandemic control with socioeconomic development effectively. A package of policy measures was implemented to stabilize the economy with good results, and the pandemic resurgence was brought under effective control. The economy has, on the whole, stabilized and rebounded. The main characteristics are as follows:
First, the Chinese economy managed to resist pressure and achieve growth. In April, major economic indicators declined year on year due to the pandemic resurgence. In response, all sides involved intensified efforts to stabilize the economy and actively worked to ensure logistics efficiency. With all these efforts, we succeeded in resisting the downward pressure and getting the economy back on the track of stabilizing and rebounding, thus securing growth in the second quarter. The GDP expanded 0.4% year on year, the value-added of industrial enterprises above the designated size grew 0.7%, and the fixed asset investment was 4.2%.
Second, in terms of monthly performance, the economy began to rebound gradually in May. In April, due to the impact of unexpected factors, major indicators contracted markedly. Then, with a general improvement in the pandemic situation, the resumption of work and business production, and the payoff of several policy measures to stabilize the economy, the slide in April was halted in May. Then in June, major indicators stabilized and rebounded. Concerning production, in June, the value-added of industrial enterprises above the designated increased 3.9% year on year, up 3.2 percentage points from the previous month; the production index of the service industry grew 1.3%, compared with the 5.1% fall in May. Regarding demand, in June, the retail sales of consumer goods grew 3.1% after the 6.7% fall in May; export grew 22%, 6.7 percentage points higher than the previous month. In terms of regions, of all the 31 provincial regions on the Chinese mainland, 21, or 67%, saw faster growth in the value-added of industrial enterprises above the designated size; 30, or 96.8%, reported faster growth in the retail sales of consumer goods of enterprises above the designated sales volumes.
Third, employment and price levels were generally stable. The surveyed urban unemployment rate has fallen for two consecutive months. The rate averaged 5.8% nationally in the second quarter. It stood at 6.1% in April and fell to 5.9% in May and 5.5% in June. In June, the rate was 4.5% for those aged 25-59, the main age group for employment, a 0.6 percentage point lower than the previous month; the rate was 5.3% for migrant workers with permanent rural residency, down by a 0.9 percentage point from the previous month. Consumer prices grew by a mild 2.3% in the second quarter. The growth was 2.1% year on year in April and May, and a slightly higher 2.5% in June. The growth was much lower than that of the Eurozone and the United States, which stood at 8.6% and 9.1%, respectively, in June.
Fourth, foreign trade delivered good performance, and forex reserves remained stable. Foreign trade in goods maintained a fast growth of 8.1% in the second quarter. It grew 0.1% and 9.6% in April and May and expanded to 14.3% in June. China's forex reserves stood above $3 trillion throughout the second quarter.
Fifth, industries continued to upgrade. New industries saw fast growth. In the second quarter, the value-added of high-tech manufacturing enterprises above the designated size rose 5.7% year on year, 5 percentage points higher than that of all industrial enterprises above the designated size. The proportion of the manufacturing sector in the economy continued to increase, with its value-added accounting for 28.8% of the national GDP in the second quarter, a 0.3 percentage point higher year on year. The modern service sector also registered fast growth, as represented by the information transmission software and information technology service segment, whose value-added grew 7.6% year on year, and the financial service segment, whose value-added grew by 5.9% year on year, both remarkably faster than that of the entire service sector.
Generally speaking, the Chinese economy withstood multiple pressure and challenges in the second quarter. Its major indicators first declined and then stabilized and rebounded. Next, although the Chinese economy will still face many difficulties and challenges due to such unexpected factors as complex and grave international environment and the impact of the pandemic at home, the fundamentals sustaining China's long-term economic growth will remain unchanged. Strong resilience, enormous potential, and vast room for maneuver will remain salient features of the Chinese economy. As the policy measures to stabilize the economy continue to pay off, the Chinese economy is expected to gradually recover and maintain stable growth. Thank you.
_ueditor_page_break_tag_CCTV:
Since the beginning of this year, complex changes have occurred both at home and abroad. What are the characteristics of economic growth in China? What are your views on the economic operation of the first half year? Thank you.
Fu Linghui:
Thank you for your questions. Since the beginning of this year, the international environment has become increasingly complex and grave, and the Ukraine crisis has further evolved; at home, there have been frequent and sporadic COVID-19 cases. Such emergency factors have gone beyond our expectations. As a result, the Chinese economy suffered a certain degree of fluctuations. Following a better-than-expected recovery in January and February, major economic indicators declined markedly due to international factors and the pandemic impact at home in March and April; then, since May, economic performance has been gradually stabilizing and rebounding, and much more positive changes have been taking place as a package of policy measures to stabilize the economy and control the pandemic in a coordinated manner gradually pay off. The main characteristics are as follows.
First, the economy managed to grow against a headwind. Since the beginning of this year, the international situation has become increasingly complex and grave, and the global economy has slowed down evidently; at home, frequent and sporadic pandemic cases have dealt a heavy blow to economic stability. The downward pressure the Chinese economy faces added greatly in April particularly. In response, all localities and departments have followed the decisions and arrangements of the CPC Central Committee and the State Council to effectively coordinate pandemic control and socioeconomic development. We have stepped up macroeconomic policy adjustment and rolled out a package of policy measures to stabilize the economy, thus effectively stabilizing the economy's fundamentals and scoring growth in the second quarter. China's GDP grew 2.5% in the first half year and 0.4% in the second quarter, which was hard won given the decline in major production and demand indicators in April and May. It showed the strong resilience of the Chinese economy.
Second, prices have remained stable on the whole. Affected by geopolitical conflicts and increased liquidity of the world's major economies, the prices of major commodities, especially those of grain and energy, have remained high, adding to the impact of imported inflation on China. Against such a backdrop, China has stepped up market supply to stabilize prices, worked hard to ensure grain and energy output, and thus managed to keep domestic prices stable. In the first half year, consumer prices rose by 1.7% year on year, lower than the whole-year target of around 3%. The core CPI, excluding food and energy prices, remained stable by gaining 1% yearly. Rising prices in China have been much lower than that of Europe and the United States, providing favorable conditions for stabilizing the economy and improving the people's wellbeing.
Third, employment and people's livelihood have been guaranteed. Due to the epidemic outbreak, the employment pressure has risen sharply this year, and increasing personal income and ensuring people's wellbeing have become more difficult. Focusing on addressing acute issues, government authorities and departments continued to step up efforts to provide employment stability and strengthen efforts to meet people's basic living needs. Progress has been made in this regard. In the first half of the year, the newly increased employed people in urban areas totaled 6.54 million. The surveyed unemployment rate in urban areas has fallen for two consecutive months since May, reversing the earlier upward trend. In June, the rate dropped to 5.5%. The surveyed unemployment rate of the population aged 25 to 59 was 4.5%, roughly the same as in January. People's income has increased steadily. In the first half of the year, personal per capita disposable income increased by 3% in real terms year on year, slower than the first quarter but faster than the economic growth. The national per capita net income from transfers witnessed a nominal growth of 5.6%, a 0.9 percentage point higher than the growth rate of total income.
Fourth, China's foreign trade has shown resilience. The impetus for global trade growth has been weakening since the beginning of this year. The new export order index of the worldwide manufacturing PMI has been below the 50-point mark for four consecutive months. However, China's foreign trade has maintained rapid growth, overcoming the adverse effects of the tightening external environment and the epidemic outbreak, which showed the strong resilience of China's foreign trade. In the first half of the year, the total volume of trade in goods grew by 9.4% year on year, with exports up by 13.2%. The total volume of trade in goods grew by 14.3% in June year on year, up 4.7 percentage points from the previous month.
Fifth, the momentum of transformation and upgrading has continued. Despite the complex and grim external environment and growing downward pressure on the domestic economy, China continued to boost innovation-driven development and the momentum of transformation and upgrading remains unchanged, with the new impetus growing fast. In the first half of the year, the value added of high-tech manufacturing enterprises above the designated size went up by 9.6% year on year, and the investment of high-tech industries grew by 20.2% year on year, maintaining fast growth. The online retail sales of physical goods went up by 5.6%, accounting for 25.9% of the total retail sales of consumer goods. The structure of the Chinese economy has been adjusted and improved. The value-added of the manufacturing sector accounted for 28.8% of the GDP in the first half of the year, up a 0.7 percentage point year on year. The per capita income of urban households was 2.55 times that of rural households, 0.06 less than last year. We continued to promote the green transformation. The share of clean energy consumption increased by 1.3 percentage points in the first half of the year, and the output of new energy vehicles and solar batteries grew by 111.2% and 31.8% respectively.
In general, the country's economy has maintained growth by overcoming difficulties in the year's first half, showing the recovery momentum. However, the recovery of the domestic economy is still facing many challenges due to the complex and grim external environment. Next, following the decisions and deployment of the CPC Central Committee and the State Council, we will effectively coordinate epidemic control and prevention and economic and social development and promote the implementation of policies and measures to stabilize growth to promote sustained and sound economic development. Thank you.
_ueditor_page_break_tag_Reuters:
China's GDP in the first half year went up by 2.5%, much lower than the annual growth target of around 5.5%. What do you think of the recovery momentum in the year's second half? Will new measures to stabilize growth be rolled out, especially in boosting consumption and private investment? Thank you.
Fu Linghui:
Thank you for your questions. In the first half of the year, the Chinese economy was affected by the complex and grim external environment and the epidemic resurgence. With concerted efforts of all sectors, we maintained a hard-won positive economic growth in the second quarter. For the next stage, stagflation risks of the global economy are rising, and there are still many unstable and uncertain factors in the recovery of the domestic economy. But China's economy has strong resilience and great potential, and its long-term positive trend has not changed. By implementing policies and measures to stabilize growth, China's economy is expected to improve gradually.
First, the country's economy has resilience. Despite the shocks caused by the epidemic resurgence, the country's economic aggregate remained considerable and enjoyed the advantages of a solid material foundation and a super-large market. The economic aggregate reached 56 trillion yuan in the year's first half, with the industrial added value approaching 20 trillion yuan, the value added created by the service sector exceeding 30 trillion yuan, and the fixed-asset investment exceeding 27 trillion yuan. Retail sales dropped slightly but still exceeded 21 trillion yuan. All these figures have strengthened our strength and confidence in coping with various risks and challenges.
Second, there is potential for the recovery of demand. In terms of investment, we continued to make efforts to stabilize investment, with the issuance and use of special bonds being accelerated, significant projects being advanced, and investment in infrastructure being boosted. Investment is expected to play a more prominent role in stabilizing growth. In the first half of the year, infrastructure investment grew by 7.1% year on year, a 0.4 percentage point higher than in the first five months. Regarding leading indicators, total planned investment in new projects rose 22.9% year on year in the first half of the year, maintaining rapid growth. In terms of consumption, as the epidemic prevention and control improved, offline consumption scenarios gradually recovered. Consumption is expected to continue to recover, fueled by policies to promote consumption. The country's imports and exports have strong resilience in terms of foreign trade. We continue to encourage smooth freight and logistics services. The imports and exports of the Yangtze River Delta region have recovered quickly, the business environment at ports has continued to improve, and there is a good foundation for maintaining steady and high-quality growth of foreign trade. The imports and exports rose 9.5% in May year on year, up 9.4 percentage points from April. The imports and exports rose 14.3% in June year on year, up 4.8 percentage points from May.
Third, there are pillars for production recovery. In terms of industries, the total value added of the industrial enterprises above the designated size resumed positive growth in May, up 0.7% year on year and up 3.9% year on year in June. As the resumption of work and production is accelerated and bottlenecks in industrial and supply chains are unclogged, the leading role of key sectors, such as the auto and electronic industries, is expected to grow. In particular, the accelerated recovery of production in areas heavily affected by the epidemic in the second quarter has contributed to the stable industrial growth. The manufacturing purchasing manager's index (PMI) climbed above the tipping point again in June. The Production and Operation Expectation Index rose to 55.2%, showing the confidence of manufacturing companies has continued to grow. In terms of the service sector, as the epidemic prevention and control improved, the service production reversed the decline in June, with the Index of Services Production shifting from decline to an increase of 1.3% year on year, with the recovery momentum of the contact and cluster industries being apparent. As life and work quickly return to normal, service market demand has gradually picked up, business confidence has recovered, and the service sector is expected to improve. In June, the PMI for services was 54.3%, a return to expansionary territory. The Business Activity Expectation Index for services was 61%, rising for the second consecutive month. In terms of transport and logistics, smooth transport and logistics services have supported the further recovery of production. Freight turnover rose 5.7% in June year on year, up 2.3 percentage points from the previous month. The logistics performance index (LPI) was 52.1%, up 2.8 percentage points from the last month.
Fourth, innovative development injects growth impetus. In recent years, China has further put into action the innovation-driven development strategy, vigorously promoted industrial transformation and upgrading, and effectively boosted new drivers of growth. Due to the COVID-19 pandemic, traditional industries have made a faster shift to digital-driven, internet-based, and smart-tech models, and new industries and new drivers have continued to maintain their steady and rapid growth, offering continuously enhanced support to the economic growth and being conducive to promoting the sustained recovery of the economy. In the second quarter, the value-added of high-tech manufacturing enterprises above the designated size increased by 5.7% year on year, 5 percentage points faster than the growth rate of industries above the designated size. The added value of information transmission, software and information technology service industries increased by 7.6%, 7.2 percentage points higher than the growth rate of the GDP.
Fifth, macro policies have helped guarantee growth. Since the second quarter, facing downward pressure on the economy, the CPC Central Committee and the State Council have timely issued 33 policies and measures in six aspects to stabilize the growth. All regions and departments have responded quickly and implemented these policies and measures in an effective way. In June, the State Council further strengthened its deployment and called for accelerating the solid implementation of a package of policies and measures to stabilize the economy. From the recent situation of the economic operation, we can see investment in infrastructure has been accelerated significantly, the consumption of bulk commodities such as automobiles has notably rebounded, the flow of logistics and people has become smoother, the expectation and confidence of enterprises have gradually improved, and the policies to ensure stable growth have been working effectively. In the next stage, the intended effect of policies such as refunding large-scale VAT credits, issuing and using special bonds, and strengthening the financial support for the real economy will continue to be unleashed, helping promote sustained recovery and sound development of the economy.
In general, as the epidemic prevention and control situation has improved and the policies have shown effects, China will further harness its strengths as a large economy with broad market space, strong development resilience, sufficient reform dividends, and strong governance capacity, and China's economy is expected to continue to recover. We should also notice that there are still instability and uncertainties in the external environment, and China is under the triple pressures of shrinking demand, disrupted supply, and weakening expectations. Therefore, we need to continue to make unremitting efforts to stabilize the macroeconomic performance and promote the sustained recovery of the economy. Thank you.
_ueditor_page_break_tag_CNR:
We have noticed that in the first half of the year, the economy in some regions was severely affected by the COVID-19 epidemic, so how about their current situation? Moreover, how about the performance of China's regional economy on the whole? What are your comments? Thank you.
Fu Linghui:
Thanks for your questions. Indeed, since the first half of this year, the epidemic has had a severe impact on the economic operation of some regions. However, it should be noted that the impact is short-term and external and will not change the general and coordinated development trend of the regional economy. In the first half of the year, especially in the second quarter, our well-coordinated efforts to respond to COVID-19 and pursue economic and social development have witnessed positive effects. With the implementation of a package of policies and measures to stabilize growth, China's economy has gradually overcome the adverse impact brought about by the epidemic and accelerated its recovery. Positive changes have been witnessed in some regions that were hit hard by the epidemic.
First, in the second quarter, the economy of most regions was basically stable. In terms of growth, in the second quarter, among the country's 31 provinces (autonomous regions and municipalities), 26 of them maintained their GDP growth, accounting for 83.9% of the total number. From the perspective of employment, the surveyed urban unemployment rate of 19 provinces (autonomous regions and municipalities) in the second quarter was lower than the national average, of which the surveyed urban unemployment rate of the western region was 5.5%, 0.3 percentage points lower than the national average level. In terms of prices, the price rise in most regions was moderate, and the consumer prices in 30 provinces (autonomous regions and municipalities) rose less than 3% year on year in the second quarter
Second, central and western regions saw sound economic growth. In the second quarter, the GDP of central and western regions increased by 2.3% and 2% year on year, respectively, both faster than that of the whole country. In the first half of the year, the growth of central and western regions was faster than that of the eastern region, with their added value of industries above designated size both increasing by 7.3% year on year, 5.1 percentage points faster than that in the eastern region. Fixed asset investment in central and western regions increased by 10.7% and 8%, respectively, faster than that in the eastern region by 6.2 and 3.5 percentage points, respectively.
Third, some areas were hit hard by the epidemic. The normal order in work and life in these regions was affected to a certain extent, thus, the local economy declined, and the unemployment rate increased in the short run. In the second quarter, the GDP of Shanghai and Jilin fell by 13.7% and 4.5% year on year, respectively, while the surveyed urban unemployment rate in Shanghai and Jilin stood at 12.5% and 7.6%, respectively, significantly higher than the national level.
Fourth, the economy of regions hit hard by the epidemic accelerated the recovery. Although the economy of some regions in the second quarter was severely affected by the epidemic, on a monthly basis, the main economic indicators in these areas improved notably in June. These improvements were made when the epidemic response was moving in a positive direction, and enterprises sped up their resumption of work and production. The added value of industries above the designated size in Shanghai and Jilin increased by 13.9% and 6.3% year on year in June, and fell by 30.9% and 4.9%, respectively in May. In terms of consumption, retail sales of units above designated size in Jilin increased by 5.5% in June and fell by 1.5% in May. In terms of employment, the surveyed urban unemployment rates in Shanghai and Jilin fell by 9.7 and 0.8 percentage points respectively in June compared with those in May, indicating that the economic recovery in these regions is steadily accelerated.
Generally speaking, the economy in most regions of China is stable. The growth rate of central and western regions is faster than that of the eastern region, while the trend of regional coordinated development has not changed. Some regions have encountered temporary difficulties due to the epidemic; however, as various policies and measures have been implemented to stabilize the economy, their economy has accelerated the recovery. Of course, we should also see that the problem of unbalanced economic development in China is still prominent, and the development gap between regions is large. Going forward, we will continue to implement major regional development strategies and coordinated regional development strategies, narrow the regional gap, and promote coordinated and sustainable economic development. Thank you.
_ueditor_page_break_tag_Bloomberg:
My question is about the industrial output. Looking at the headline numbers, the rise is 3.9%. But if you look at the breakdown, according to my calculations, the electricity output only rose 0.1%, rolled steel output fell 3.7%, cement output fell over 17%, flat glass only rose 0.2%, semi-conductors fell, ores fell, smart production fell, what rose to drive total industrial output up 3.9% when so many industrial goods output fell over the same period? Thank you.
Fu Linghui:
This year, affected by the epidemic, industrial production declined in April, increased from the decline in May, and the growth rate accelerated notably in June. From the output and added value of industrial products, we can see the production of the auto industry rebounded remarkably in June. The industrial chain of the auto industry in the Yangtze River Delta was affected to a certain extent earlier this year due to the epidemic. However, as the economy in Shanghai and other regions has begun to recover recently, the production growth of the auto industry is accelerating both in its output and its added value compared with those in May, contributing to the rise of industrial production in June. You just talked about the decline of some products. However, in general, we see growth according to statistics for over 500 products, so we can tell that industrial production rebounded in June. From the perspective of structure, the equipment manufacturing industry rebounded remarkably. In particular, the rise of the auto industry has contributed greatly to the growth of the whole industry. As the economy gradually recovers, other industries have also played their supporting roles in the overall industrial growth. Thank you.
_ueditor_page_break_tag_Cover News:
The surveyed unemployment rate of young people aged 16-24 hit a new high this year. Can you give a detailed introduction to the current employment situation of young people? What is your prediction of the employment situation in the next stage? Will it be possible to achieve the annual target of adding more than 11 million jobs?
Fu Linghui:
Thank you for your questions. Employment is a matter of concern because it is the foundation of people's livelihoods. Since the beginning of this year, factors such as the complex and severe international environment and the impact of the domestic epidemic have had a certain impact on employment. In general, with the joint efforts of all parties, the economy has been recovering and various employment stabilization policies have been implemented, reversing the rising trend of surveyed urban unemployment. Due to various factors, the surveyed urban unemployment rate rose to 6.1% in April. But as the epidemic prevention and control situation improves, the rate has dropped for two consecutive months since May. In May, the rate was 5.9%, down 0.2 percentage points from the previous month, and it further fell to 5.5% in June. Looking at the situation in the second quarter, the employment situation mainly has the following characteristics:
First, the employment of the main working population is generally stable. Although the unemployment rate of the main working population aged 25-59 increased in April, the increase was significantly lower than the overall unemployment rate. In June, the unemployment rate among those aged 25-59 was 4.5%, a decrease of a 0.6 percentage point from the previous month and close to the average level in 2021.
Second, the employment situation of rural migrant workers has improved. Migrant workers are mostly engaged in labor-intensive manufacturing and service industries, are mostly self-employed, and have flexible employment, so their employment stability is relatively poor. Affected by the impact of the epidemic, the unemployment rate of the migrant population with rural household registration rose to 6.6% in April. As the epidemic is gradually brought under control and measures to help enterprises stabilize jobs begin to deliver, the employment of migrant workers has improved significantly. The unemployment rate of the migrant population with rural household registration dropped to 6.2% in May and 5.3% in June, lower than the overall unemployment rate.
Third, the employment pressure on young people is still relatively high. When young people enter the labor market for the first time, they face a frictional unemployment dilemma. At the same time, affected by the epidemic, the ability of enterprises to absorb employment has declined, and young people's job-seeking channels have also been hindered amid the epidemic. In addition, the total number of college graduates this year has reached a record high, intensifying the employment pressure on young people. In June, the youth unemployment rate for the16-24 age group in urban areas was 19.3%, the highest level for this year.
In general, with the economy's recovery and effective employment stabilization policies, China's employment situation showed an overall improvement trend in the second quarter. However, the problem of youth employment pressure is still prominent. We must continue stabilizing employment, especially the employment of key groups. We must further implement the employment stabilization policies and offer employment assistance to promote the continuous improvement of the employment situation. Thank you.
_ueditor_page_break_tag_Financial Times:
You mentioned that fixed asset investment continued to improve in the second quarter. Meanwhile, cement production dropped by 12.9% in June. The asphalt production rate also showed a relatively historical low. So how to understand such a contrast? What are your expectations for future infrastructure investment? Thank you.
Fu Linghui:
Thanks for your questions. Since the beginning of this year, people have paid high attention to investment and related investment products. In recent years, in terms of China's investment in three major sectors, investment in manufacturing has seen the fastest growth, with a growth rate of more than 10% in the first half of this year. Among the manufacturing industry, high-tech manufacturing grew by more than 20%. From the structure perspective, China's economic and industrial development is gradually upgrading, and the drive for industrial-upgrading-related products is relatively obvious. In contrast, investment growth in some traditional industries has gradually slowed down. With the continuous advancement of high-quality development of China's industrial upgrading and development and continuously innovative development in the future, the driving force for equipment manufacturing and high-tech-related products is increasing. Therefore, in general, although China's economy has been hit by the epidemic this year, the trend of industrial development and upgrading and high-quality development has not changed. Employment and prices are generally stable. Judging from these circumstances, the trend of China's economy to maintain a steady growth and move towards high-quality development will not change in the future. Thank you.
_ueditor_page_break_tag_Asahi Shimbun:
If there were no COVID-19 impact, what would the potential growth rate of China's economy have been? How do you see the possibility of economic recovery in the second half of the year for achieving the full-year GDP growth target of 5.5%? Thank you.
Fu Linghui:
Thank you for your questions. Many institutions and scholars have made calculations regarding the potential growth rate of China's economy, and the calculation results are somewhat different. Generally speaking, most conclusions agree that the potential growth rate of China's economy at this stage is about 5%-6%. As China's economy grows larger and the constraints on labor, resources, and the environment become stronger, the potential growth rate will gradually decrease. However, from a global perspective, the potential growth rate of 5%-6% is still at a medium and high level. Especially under the conditions of such a large economy as China, it is very difficult to maintain medium- and high-level growth, which also shows that China's economic growth potential is still relatively large.
China is still the largest developing country in the world. Although China's per capita GDP has exceeded $10,000, there is still a big gap compared with the per capita level of more than $40,000 in developed countries. This gap means a huge space and potential for the future development of China's economy. It should be pointed out that due to the complex and severe international environment, compounded by the COVID-19 pandemic unseen in a century, the adverse currents encountered by globalization, and the critical period for China's economic restructuring, it is increasingly difficult for China's economic growth to reach its potential level. To maintain steady economic growth, we still have to work hard. In the first half of this year, China's economy overcame unexpected factors and maintained growth, which was an uphill battle. The risk of stagflation in the world economy is on the rise, external instability and uncertainties are increasing, and the triple pressures of shrinking domestic demand, supply shocks, and weakening expectations still exist. Achieving the expected economic growth target for the whole year is challenging. However, it should also be noted that the fundamentals that sustain China's long-term economic growth have not changed, the economy still shows strong resilience, the macro policy adjustment tools are abundant, and there are many favorable conditions for promoting sustained economic recovery. In the second half of this year, with the efficient coordination of COVID-19 response and socioeconomic development, and various economic recovery policies and measures yielding tangible results, China's economy is expected to continue to rebound and perform within a reasonable range. Next, we must seize the favorable opportunity for economic recovery, coordinate COVID-19 response and economic and social development following the overall requirements of preventing the epidemic, stabilizing the economy, and developing safely, and ensure policies and measures to stabilize the economy continue to yield results, so that we can consolidate the foundation for economic recovery, and maintain sustainable and healthy economic development. Thank you.
_ueditor_page_break_tag_Cover News:
The CPI in June hit a two-year high. As the "hog cycle" has entered the upward trajectory, will inflationary pressures intensify in the second half of the year? What measures will the government take to keep prices within a reasonable range? Thank you.
Fu Linghui:
Thank you for your question. Since the beginning of this year, global inflationary pressures have risen, and domestic concerns about prices have also increased. As the domestic market demand has gradually recovered, coupled with imported factors from abroad, the year-on-year growth of the CPI continues to increase but remains moderate. In the first half of the year, the CPI went up by 1.7% year on year, with food prices down 0.4% and non-food prices up 2.2%. In the second quarter, CPI growth was generally stable, up 2.3% year on year. On a monthly basis, the CPI went up by 2.1% year on year both in April and May, up 2.5% in June. In the second quarter, CPI changes have the following features:
First, food prices rose after a fall. Food prices rose 2.3% in the second quarter after a 3.1% drop in the first quarter. This can be explained by an intensified price increase in fresh fruit, fresh vegetables, eggs, and grain and a rally in pork prices. Pork prices decreased by 21.3% in the second quarter, 20.5 percentage points lower than the previous quarter.
Second, industrial consumer prices have increased at a quicker pace. In the second quarter, industrial consumer prices went up by 4.1% year on year, 1.1 percentage points higher than that of the first quarter. This was mainly affected by international import factors; prices of some energy products have continued to rise, with gasoline and diesel prices rising 30% and 32.8%, respectively, year on year in the second quarter.
Third, the rise in service prices has moderated. Affected by factors such as the epidemic, the demand for services has been weak, which dragged down the increase in service prices. Service prices went up by 0.8% year on year in the second quarter, 0.5 percentage points lower than that in the first. The price increases of airline tickets and tourism have all declined. June's CPI went up by 2.5% year on year, mainly due to the lower base in the previous year. Among the 2.5% year-on-year increase in June, the carryover effect accounted for 1.2 percentage points, 0.4 percentage points higher than the previous month, while the influence of new factors was about 1.3 percentage points, the same as the previous month. In terms of industry, food prices went up 2.9% year on year, 0.6 percentage points higher than last month, mainly due to the narrowed drop in pork prices. Energy prices went up 17.4%, an increase of 2.7 percentage points, mainly due to the impact of rising gasoline and diesel prices. Core CPI, excluding the prices of food and energy, went up by 1%, 0.1 percentage points higher than last month, indicating that supply and demand have stabilized.
From the international perspective, China's inflation has been significantly lower than that of European and American countries, mainly because China has not implemented massive stimulus policies. Facing imported inflation, we stepped up efforts to ensure supply and stabilize prices at home. In addition, grain production has been strengthened, and China has reaped a summer grain harvest this year. Summer grain production increased by 1% over the previous year, which meant that the CPI was generally stable. Price stability is not only conducive to the smooth operation of the economy but also to the improvement of people's livelihoods.
As for whether rising pork prices will affect the overall increase of the CPI, generally speaking, the impact has been limited. At present, hog production capacity has returned to normal, and their prices are not expected to rise sharply. More supply is expected as pigs that were previously put on hold will be brought into the market. In addition, relevant departments will strengthen market regulation and stabilize supply and the demand, which will help ensure stable prices.
Next, as we enter the flood season, the supply of fresh products from certain areas might be affected, and the influence of imported factors may also continue, but the capacity of supplying products and services has been sufficient, and prices are expected to maintain a moderate upward trend. Thank you.
_ueditor_page_break_tag_ThePaper.cn:
You mentioned that the growth rate of industrial value-added above designated size turned from negative to positive in May and continued to increase in June. The spread of COVID-19 in many parts of China has brought uncertainties to economic and social development. What do you think of the current resumption of work and production in China? What is the prediction for the recovery of the industrial economy in the second half and for the whole year? Thank you.
Fu Linghui:
In the first half of the year, due to unexpected factors both at home and abroad, the monthly year-on-year growth rate of industrial production decreased in April. However, since May, industrial production has continued to rebound as the measures to coordinate epidemic prevention and control and economic and social development have taken effect, and the measures to stabilize industrial economic operations have also delivered their desired effect. In the first half of the year, the value added of industrial enterprises above designated size increased by 3.4% year on year. In the second quarter, industrial production stopped its decline and turned positive. In the second quarter, the value added of industrial enterprises above designated size increased by 0.7% year on year, specifically a 2.9% decrease in April and a 0.7% increase in May, before a strong rally of 3.9% in June, hinting at a recovery. This recovery mainly showed in the following aspects:
First, the mining industry has maintained rapid growth. Energy supplies and price stability continued to be promoted, and relevant industries continued to grow fast, driving the value-added growth of the mining industry. In the second quarter, the value added growth of the mining industry grew by 8.4% year on year, with double-digit growth in the coal mining and washing industries, which were both significantly faster than the growth of all industries above designated size.
Second, value-added figures in high-tech manufacturing enterprises have demonstrated stable growth. Despite adverse effects such as the impact of the epidemic, the trend for industrial upgrading and development has not changed, and high-tech manufacturing has grown rapidly. In the second quarter, the value added of high-tech manufacturing above designated size increased by 5.7% year on year, higher than that of other industries above designated size, which has shown remarkable resilience.
Third, the export of industrial products played an active role in driving economic growth. China has a robust industrial production capacity and international competitiveness, and the export of industrial products maintained rapid growth. In the second quarter, the export delivery value of industrial enterprises above the designated size achieved a year-on-year increase of 8.2%, with a rise of 15.1% in June, which was 4 percentage points higher than that of the previous month.
Fourth, industrial production in the central and western regions was generally stable. In the second quarter, although parts of the eastern and northeastern areas were significantly affected by COVID-19, the industrial production in the central and western regions was generally stable, supporting the industrial production. In the second quarter, the added value of industrial enterprises above the designated size in the central and western regions rose by 5.9% and 6%, respectively. The growth rate was higher than the added value of industrial enterprises above the designated size nationwide.
According to the statistics in June, with a series of policies to ensure stable growth taking effect, industrial production rebounded markedly. First, the growth rate rebounded in most sectors and regions. In June, the growth rate of 27 of the 41 major industries rebounded from the previous month, accounting for 65.9%. The growth rate of industrial enterprises above the designated size in 21 regions of 31 provinces (autonomous regions, municipalities) rebounded, accounting for 67.7%. Second, the growth rate of the equipment manufacturing industry accelerated. As barriers in the industrial and supply chains have been gradually removed, the production in the automobile manufacturing sector rebounded significantly, driving rapid growth in the equipment manufacturing industry. In June, the added value of the equipment manufacturing industry rose by 9.2% year on year, 8.1 percentage points higher than the previous month, with the automobile manufacturing sector increasing by 16.2%, which had decreased by 7% during the last month. Third, the industrial production in the areas hit hard by COVID-19 in the early stage recovered significantly. In June, the added value of industrial enterprises above the designated size in Shanghai and Jilin province grew by 13.9% and 6.3%, respectively, dropping by 30.9% and 4.9% in the previous month.
All these statistics show that industrial production is steadily recovering; the impact of external shocks such as COVID-19 is gradually subsiding; production operations are improving at a faster pace. Industrial production plays a more vital role in supporting the economy, and industrial upgrading continues its good momentum, enhancing the quality of industrial development. However, it should be noted that currently, barriers still exist between industrial production and sales, enterprises in some industries face many difficulties, and it still requires continuous efforts to stabilize the industrial economy. In the next stage, measures will be taken to implement policies to ease the challenges of businesses fully. These include strengthening open and smooth logistics services, removing barriers in industrial and supply chains, and supporting enterprises in pursuing innovative development. These measures will ensure the stable performance of industrial production. Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
The last question, please.
National Business Daily:
In April, the year-on-year growth rate of total retail sales in China reached the lowest point in the year's first half. Since then, May and June have witnessed a rebound in the growth rate. Does that mean that the turning point of this year's V-shaped consumption recovery has passed? Is the rapid rebound in consumption related to a short-term stimulus caused by distributing consumption coupons in many places? How does the National Bureau of Statistics predict the consumption trend in the second half of this year? Thank you.
Fu Linghui:
Thank you for your questions. The issue of consumption is of great concern to the people. Since the beginning of this year, various factors have affected consumption growth. In the first half of this year, affected by multiple and sporadic local resurgences of COVID-19, market sales declined, especially with a marked decline in service consumption. In the first half of this year, the total retail sales of consumer goods dropped by 0.7% year on year. However, since May, as COVID-19 has been effectively contained and the policy to boost consumption has taken effect, market sales have grown steadily. The total retail sales in May fell by 6.7% year on year, 4.4 percentage points less than the previous year's decrease. In June, the growth rate shifted from a decline to an increase of 3.1% year on year.
Based on the situation in the first half of this year, the market sales mainly showed the following characteristics:
First, the consumption of goods for basic living registered rapid growth. In the first half of this year, the retail sales of grain, oil, food, and beverage grew by 9.9% and 8.2%, respectively, ensuring people's consumption for basic living.
Second, online retail sales grew steadily. In the first half of this year, the online retail sales of physical goods increased by 5.6%, accounting for 25.9% of the total retail sales of consumer goods.
Third, service consumption dropped. Under the impact of the pandemic, service consumption fell markedly. In the first half of this year, the catering revenue decreased by 7.7% year on year. Service consumption such as traveling also declined.
According to the situation in June, positive changes have occurred in domestic market sales.
First, most of the goods saw an increase in retail sales growth rates. In June, nearly 90% of the 18 categories of goods of enterprises above designated size witnessed rebounds in retail sales compared with the previous month. Among them, the growth rates of the retail sale value of clothing and daily necessities rebounded significantly. Furthermore, retail sales of cosmetics and communication appliances increased by 8.1% and 6.6%, respectively.
Second, the consumption of major commodities played a significant role in driving growth. The introduction and implementation of policies to promote consumption in critical areas such as halving the purchase tax for eligible passenger vehicles, boosted the sales of major commodities like automobiles and home appliances. In June, the retail sales of automobiles, home appliances and audio-visual equipment of enterprises above the designated size rose by 13.9% and 3.2%, respectively, a marked increase from the previous month, driving the growth rate of the retail sales of consumer goods in June by over 1.5 percentage points.
Third, service consumption such as catering was significantly improved. As people gradually increased their out-of-home consumption, service consumption improved as a result. In June, the catering revenue fell 4% year on year, compared with a 21.1% decline in the previous month. The number of domestic tourism trips and income during the Dragon Boat Festival holiday was much better than during the May Day holiday.
Fourth, the consumption in areas struck by COVID-19 rebounded rapidly. In June, the retail sales of goods of enterprises above the designated size in Shanghai decreased by 2.1% year on year, shrinking from the 44.1% decline registered in the previous month. Meanwhile, the retail sales of goods of enterprises above the designated size in Jilin province grew by 5.5%, compared with a decrease of 1.5% in the previous month.
In general, since May, domestic consumption has withstood the impact of COVID-19 and showed recovery momentum, with significantly more positive changes taking place. Although recovery in consumption is still facing constraints such as the slowdown in the growth of personal income and the limited consumption scenarios, the trend of expansion in the consumption scale, upgrading within the consumption structure, and innovation in the consumption model will not change. With improved social security and support of policies to stabilize employment and promote consumption, China's consumption is expected to sustain a sustained recovery. Thank you.
Shou Xiaoli:
Thank you to Mr. Fu Linghui and friends from the media. Today's briefing is at this moment concluded. Goodbye.
Translated and edited by Yuan Fang, Zhang Rui, Zhou Jing, Huang Shan, Liu Qiang, Xu Kailin, He Shan, Yan Xiaoqing, Wang Qian, Zhang Liying, Yang Xi, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Ruan Jianhong, spokesperson of the People's Bank of China (PBC) and director general of the Statistics and Analysis Department at the PBC
Zou Lan, director general of the Monetary Policy Department at the PBC
Sun Tianqi, director general of the Financial Stability Bureau at the PBC
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
July 13, 2022
Xing Huina:
Friends from the media, good afternoon. Welcome to this press conference held by the SCIO. Today, we will introduce China's financial statistics from the first half of 2022 and answer your questions. Joining us are Ms. Ruan Jianhong, spokesperson of the PBC and director general of the Statistics and Analysis Department at the PBC; Mr. Zou Lan, director general of the Monetary Policy Department at the PBC; and Mr. Sun Tianqi, director general of the Financial Stability Bureau at the PBC.
Now, I'll give the floor to Ms. Ruan for her introduction.
Ruan Jianhong:
Friends from the media, good afternoon. Since the beginning of this year, the PBC has conscientiously implemented the plans of the Central Committee of the Communist Party of China (CPC) and the State Council, strengthened the prudent monetary policy, used monetary policy tools to adjust both the monetary aggregate and structure, risen to the challenges, and worked to serve the real economy and maintain stable macroeconomic performance. Financial statistics show that the first half of this year has witnessed reasonably adequate liquidity, stronger financial support for the real economy, improved credit structure, and a steady decrease in the overall financing costs of businesses. The financial sector has offered higher quality services for the real economy more efficiently.
First, liquidity has remained reasonably adequate and the financial sector has offered stronger support for the real economy. In the first half of the year, the PBC reduced its required reserve ratios by 0.25 percentage point and contributed surplus profits of 900 billion yuan to reasonably increase liquidity supply and enable financial institutions to offer stronger credit support for the real economy. At the end of June, broad money supply (M2) increased by 11.4% year on year, up 2.8 percentage points from a year earlier. In the first half of the year, the aggregate financing to the real economy (AFRE) (flow) was 21 trillion yuan accumulatively, up 3.2 trillion yuan from the same period in 2021; new RMB loans reached 13.68 trillion yuan, increasing by 919.2 billion yuan year on year.
Second, the credit structure has been continuously improved. The PBC has given full play to the guiding roles of structural monetary policy, introduced multiple structural monetary policy tools, supported inclusive loans to micro and small businesses, helped stabilize employment within micro, small, and medium enterprises (MSMEs), and strengthened support for key fields and weak links in the national economy. At the end of June, medium- and long-term loans for manufacturing increased by 29.7% year on year, 18.5 percentage points faster than the growth of loans overall; inclusive loans to micro and small businesses increased by 23.8% year on year, 12.6 percentage points faster than the growth of loans overall; and 52.39 million micro and small businesses received inclusive loans, up 36.8% year on year.
Third, the overall financing costs of businesses dropped steadily. In the first half of the year, the PBC improved the central bank's policy interest rate system, enhanced regulation of deposit rates, and worked to keep the costs of bank liabilities stable. In June, the interest rate on new term deposits was 2.5%, 16 basis points lower than the same period of the previous year. The PBC leveraged the potential of the reform of the loan prime rate (LPR) mechanism, lowering the one-year and five-year LPR by 10 and 20 basis points respectively to reduce the overall financing costs of businesses. In June, the interest rate on new business loans was 4.16%, 34 basis points lower than a year earlier.
Going forward, the PBC will conscientiously implement the CPC Central Committee's instructions to "continue effective COVID-19 control, achieve steady economic performance, and ensure development security," stay committed to the general principle of pursuing progress while ensuring stability, flexibly employ multiple monetary policy tools as needed, use monetary policy tools to adjust both the monetary aggregate and structure, and strengthen support for the real economy to keep major economic indicators within an appropriate range, drive high-quality economic development, and pave the way for a successful 20th National Party Congress. Thank you.
Xing Huina:
Thank you, Ms. Ruan. Next, I would like to invite Mr. Zou to give his introduction.
_ueditor_page_break_tag_Zou Lan:
I would like to start by briefing you on policy-based and developmental financial instruments, a topic which is of interest to you all.
Since the beginning of this year, due to COVID-19 and unexpected factors such as the Russia-Ukraine conflict, the Chinese economy has been facing some downward pressure and investment in infrastructure has become an important means to maintain stable macroeconomic performance. In accordance with plans made at an executive meeting of the State Council, last month, the PBC increased the credit line of developmental and policy-based banks and strengthened loan support for infrastructure projects that are useful in the long term and feasible in the short term. However, at present, the difficulty in obtaining project capital is one of the main factors hindering infrastructure construction and loan issuance.
At the executive meeting of the State Council on June 29, it was decided that China would adopt policy-based and developmental financial instruments to support the development of major projects. In accordance with the decisions and plans of the CPC Central Committee and the State Council as well as the requirements of the Financial Stability and Development Committee under the State Council, the PBC supported the China Development Bank (CDB) and Agricultural Development Bank of China (ADBC) to respectively set up financial instruments totaling 300 billion yuan. The specific purposes of the financial instruments are: first, shoring up the capital bases of major projects, with the amount not exceeding 50% of the total capital; and second, acting as transit capital for special bonds that cannot be put in place in the short term. For the projects that are to be implemented, financial instruments will quickly and precisely remove impediments caused by lack of capital so that the projects can start as soon as possible. In this way, financial instruments will help maintain stable macroeconomic performance.
Policy-backed and developmental financial instruments invest in line with market principles and make decisions independently in accordance with the law and regulations. They are responsible for their own profits and losses at their own risk, breaking even and earning a meager profit. These instruments focus only on financial investments and exercise the corresponding rights as stockholders instead of involving actual construction and operation of the projects. Meanwhile, they provide exit channels in line with market principles. The projects they invest in should produce good social benefits and be economically feasible. Their investments are guided toward three types of projects, including those in five key areas in the infrastructure sector determined by the 11th meeting of the Central Commission for Financial and Economic Affairs, those in areas such as major scientific and technological innovations, and those can be funded by local government special-purpose bonds.
With well-designed policies, policy-backed and developmental financial instruments, often adopted as temporary measures, can help ensure the availability of capital for major projects instead of resorting to a deluge of strong stimulus policies or over-issuing currency. The instruments can guide financial institutions to provide medium- and long-term, low-cost loan packages, improve the monetary policy's transmission mechanism, ensure stable credit growth, and help produce a combined effect of expanded investment, increased employment, and boosted consumption so as to achieve stable macroeconomic performance. That concludes my introduction.
Xing Huina:
Thank you, Mr. Zou. Now, we welcome questions. Please name the news organization you work for before asking your questions.
_ueditor_page_break_tag_ThePaper.cn:
How was China's macro leverage ratio in the first half of this year? What does the central bank predict the ratio will be in the second half? Thank you.
Ruan Jianhong:
Thank you. I will answer your questions. The PBC has always paid attention to changes in the macro leverage ratio. Since the fourth quarter of 2020, significant advances have been made in stabilizing the leverage and promoting growth. The macro leverage ratio has been in net decline for five consecutive quarters, leaving valuable policy space for coping with various complex issues in the future. In the global context, after the outbreak of the pandemic, the increase in China's macro leverage ratio was significantly lower than in other major economies. We were able to support the rapid economic recovery with relatively few new debts. At the end of 2021, the leverage ratios of America, Japan, and the Eurozone were 25.7, 39.5, and 21.4 percentage points higher than at the end of 2019, respectively. During the same period, the increase in China's macro leverage ratio was 16.5 percentage points, significantly lower than in other major economies. Meanwhile, China's economic performance continued to lead, and inflation was generally under control. From the perspective of policy effect, the moderate growth of China's macro leverage ratio has supported an optimal combination of "higher growth and lower inflation." All this demonstrates that our macro policies are strong, sound, and effective.
In the first quarter of 2022, China's macro leverage ratio stood at 277.1%, 4.6 percentage points higher than at the end of last year. Since the start of this year, downward pressure on the economy has continued growing because of the unexpected changing international situation and the latest COVID resurgence. The macro leverage ratio, a ratio of a country's total debt to gross domestic product, always increases when economic growth slows. Meanwhile, to respond to the downward pressure and achieve stable macroeconomic performance, we have further planned a package of measures to stabilize the economy. These counter-cyclical macro-regulation policies can affect debt growth in the current period, but their impact on output will not show up until later. As a result, the macro leverage ratio will witness a temporary increase. It is a fair reflection of external shocks, as well as a result of counter-cyclical macro-regulation policies, helping maintain stable macroeconomic performance.
It is clear that despite increasing risks and challenges confronted by China's economy this year, the fundamentals that sustain economic growth remain unchanged. As the country's epidemic situation continues to improve and a package of policies and measures to stabilize the economy begin to deliver, China's economic recovery is gaining steam, creating conditions for maintaining a reasonable macro leverage ratio. Thanks.
_ueditor_page_break_tag_China News Service:
How are the policy-backed and developmental financial instruments faring? How many funds are expected to be leveraged? What's the next plan? Thanks.
Zou Lan:
Thanks for your questions. Policy-backed and developmental financial instruments are temporary steps to replenish project capital and help stabilize the macro economy. With the concerted efforts of various central departments, local governments, and enterprises, some projects have been incorporated into China's key project pool or are undergoing inclusion. Some projects are improving the provision of land, energy, and other factors of production. Some projects are accelerating their preliminary work, such as investment consultation and feasibility research. All these have provided favorable conditions for financial instrument investment. The CDB and the ADBC have been actively engaged in a batch of mature projects. They will speed up investment according to laws and regulations, thus delivering solid results in capital investment and infrastructure construction.
The timely availability of capital funds is a prerequisite for starting a project. As we have learned, several projects have secured the sources of capital funds. Still, they fall short of the requirement of project capital accounting for 20% of the total investment in the infrastructure sector. The insufficiency or untimely availability of capital funds has hindered the construction of some projects. Financial instruments can be tapped in a short time to meet the project capital demands and start a project as soon as possible. As the proportion of financial instruments that can be used as project capital cannot exceed 50%, the share of financial instruments in each project is estimated to be no more than 10%. Once capital is available in full, the initial policy-backed and developmental medium to long-term credit quota of 800 billion yuan will be dispensed promptly, and non-governmental capital such as commercial bank loans will be leveraged. As a result, efforts will be pooled to deliver solid results in project implementation and stabilize the macroeconomy.
The steady operation of policy-backed and developmental financial instruments needs to be underpinned by a raft of supporting policies on the project, capital, and regulation. The PBC will, per the decisions and arrangements of the CPC Central Committee and the State Council, work together with relevant departments to implement those instruments in an orderly manner. There are mainly three aspects of work.
First, we will accelerate the creation and operation of financial instruments. Supported by various departments, the CDB and the ADBC create financial instruments according to procedures. At the same time, we will formulate regulations and strengthen business process management and risk prevention and control to deliver daily operations, post-investment management, and risk control.
Second, we will establish a list of candidate projects. The NDRC is working with various departments, enterprises managed by the central government, and local governments to sort out a list of sufficient candidates who not only have the potential to yield significant social benefits but also are economically viable. In the meantime, we will see faster work, including project approval, preparatory work before launching a project, and putting in place essential factors of production to create more favorable conditions for the two policy banks to accelerate investment.
Third, we will step up project participation. The two banks will strengthen engagement with candidate projects. For investable projects, we will make independent investment decisions in accordance with laws and regulations and market rules. We will see that capital availability is timely and project demands are duly met. As for those projects that are only investable after some policy coordination, the two banks will provide proper feedback and follow through to see that those projects receive investment as soon as possible after certain requirements are met. Thank you.
_ueditor_page_break_tag_CNBC:
I have three questions. The first one is about China's economic performance. Some economists are worried about whether or not there will be economic stagnation. Has the PBC heeded this concern? Have any countermeasures been planned? The second is a recent PBC survey showing that Chinese people's propensity to save is at its highest in 20 years. What measures will the central bank take to boost consumption? The last question: what's the latest development in digital currency? Thanks.
Zou Lan:
Let me answer the first and third questions, and then Ms. Ruan will answer the second one.
In March and April this year, affected by unexpected factors at home and abroad, China's economy faced increasing downward pressure. As a result, some enterprises and citizens lost their income and balance sheets. Against this background, the government increased its support for the real economy. In the first five months, China's infrastructure investment increased by 6.7%, a 0.5 percentage point higher than the growth rate of the total investment. As part of the macro regulation, these are essential measures to help the economy tide over difficulties.
It should be noted that the impact of the pandemic is temporary. Since May, the COVID-19 pandemic has gradually eased off in China, and a package of policies and measures launched by the State Council to stabilize the economy have taken effect at a faster pace, with the implementation of fiscal policy, monetary policy, and industrial policy having been stepped up. Major economic indicators have improved significantly, and the national economy has seen a notable rebound. According to financial statistics, credit supply has increased significantly. From January to June, loans to corporations rose by 3 trillion yuan compared to the same period of the previous year, and corporate financing was generally good; due to the impact of COVID-19, household loans increased slower than the same period of the previous year, but have also recovered since June. In the future, with COVID-19 being generally under control, it is expected that the macro-economy will maintain a steady recovery, and the corporate and household balance sheets are expected to be gradually repaired and improved, with credit support remaining strong.
In the next stage, we will continue to encourage enterprises and individuals to expand reasonably. What is the most important is to ensure the steady and efficient operation of production and life, maintain the momentum of economic recovery; stabilize revenues, expectations, and confidence of the real sector of the economy; and further enhance the internal momentum for growth and economic vitality. Acting in accordance with the decisions and arrangements made by the CPC Central Committee and the State Council, the PBC will continue to implement its package of policies and measures to stabilize the economy. The PBC will step up efforts to implement a prudent monetary policy to create a favorable monetary and financial environment and ensure that policies will work together to create synergy and keep economic indicators within a reasonable range. To be specific:
The PBC will maintain reasonably ample liquidity. The PBC will ramp up credit support for the real economy, see that increases in money supply and aggregate financing are generally in step with nominal economic growth and turn over surplus profits to the central budget ahead of schedule. The PBC will guide policy banks and development banks to increase 800 billion yuan of credit loans and set up 300 billion yuan of financial instruments to support infrastructure construction.
In terms of price, the PBC will give full play to the effectiveness and guiding role of LPR reforms and the role of the market-based adjustment mechanism of deposit rates, guiding financial institutions to transmit the effect of the drop in deposit rates to the loan side and further promote financial institutions to reduce real loan rates.
In terms of structure, the PBC will continue to make good use of structural monetary policy instruments and give priority to providing financial support to key areas. Since the second quarter of this year, the proportion of incentive funds provided by the PBC through inclusive loans to micro and small businesses has risen from 1% to 2%. The PBC will fully utilize the instruments for supporting the reduction of carbon emission and targeted re-lending for the clean and efficient utilization of coals, scientific and technological innovation, public accessible elderly care, and transport and logistics, and will continue to support the development of agricultural businesses and micro and small businesses to create new areas of economic growth.
I would like to make a brief introduction about the latest progress in research and development of the digital yuan. In the first half of this year, in line with China's 14th Five-Year Plan, the PBC, together with participating institutions, with the support of the party committees and governments of the pilot areas, has been steadily and prudently advancing trials of the digital yuan.
First, the PBC successfully completed pilots of its digital yuan in scenarios, making it the highlight of China's science and technology achievements during the Beijing 2022 Winter Olympics and Paralympics.
Second, the PBC has prudently expanded the pilot areas. Approved by the State Council, the pilot areas have been expanded from the original "10+1" areas to 23 areas in 15 provinces and municipalities. Shenzhen, Suzhou, Xiong'an New Area, and Chengdu have canceled whitelist restrictions and absorbed the Industrial Bank as a new designated operator.
Third, the PBC has been working on making innovations in application scenarios, extending the reach of digital yuan services. Focusing on maintaining stable macroeconomic performance, the digital yuan has played an active role in ensuring people's wellbeing, stimulating consumption, expanding domestic demand, and ensuring stable growth by means of its distinctive functions, such as smart contracts.
Fourth, the PBC has actively engaged in international exchanges and cooperation, expanding its circle of friends in the use of digital yuan. As of May 31 this year, the transaction volume of the digital yuan in the pilot areas of 15 provinces and municipalities had totaled about 264 million, with transaction value approximating 83 billion yuan. The number of merchant stores supporting digital yuan payments has reached 4.57 million.
Next, the PBC will expand the pilot programs to more cities in a prudent and orderly manner, strengthen the scenario construction and application innovation, carry out research on major issues, and deepen international exchanges and cooperation.
That's all from me for your first and third questions.
_ueditor_page_break_tag_Ruan Jianhong:
I will answer the second question. According to the depositor survey conducted by the PBC in the second quarter, 58.3% of people surveyed preferred more savings deposits, up 3.6 percentage points from the previous quarter. Meanwhile, 17.9% were inclined to make more investment, down 3.7 percentage points from the previous quarter. The marginal rise in people's willingness to save and the decrease in their willingness to invest was mainly due to the resurgent COVID-19 cases in some parts of China and the increase in people's preference for liquidity. In the meantime, greater volatility in the capital market has lowered people's risk appetite. It is expected that as the pandemic's impact further eases, people's willingness to invest will gradually recover, and their willingness to consume will steadily pick up.
Since the start of this year, household deposits in China, actually not only household deposits but also including enterprise deposits, have seen a significant increase, with deposit interest rates dropping slightly. At the end of June, household deposits stood at 112.8 trillion yuan, up 10.3 trillion yuan from the beginning of this year, which was an increase of 2.9 trillion yuan over the same period of the previous year. Enterprises deposits were 74.9 trillion yuan, rising by 5.3 trillion yuan from the beginning of this year, which was an increase of 3.1 trillion yuan compared to the figure of the same period of the previous year. Financial institutions have increased support for the real economy through loans, bond investments, and other forms, and the corresponding derivative deposits have increased. In addition, in the first half of the year, China issued VAT credit refunds on a large scale, increasing the deposits in the real sector of the economy.
In June, the interest rates on newly absorbed time deposits dropped significantly to 2.5%, down 16 basis points year on year. The drop in deposit rates is conducive to enhancing financial support for the real economy, including the sustainability of consumption growth.
In the future, both household and enterprise deposits are expected to grow steadily. At the same time, the PBC will continue to deepen reforms to strengthen the market's role in setting interest rates, improve the market-based interest rate mechanism and the transmission mechanism, as well as the central bank's policy interest rate system to promote a reduction in overall financing costs of enterprises. Thank you.
_ueditor_page_break_tag_People's Daily:
We noticed that the PBC introduced a series of structural monetary policy instruments and increased financial support for key areas this year. What effect have these instruments delivered? What's the plan in the future? Thank you.
Zou Lan:
I'll answer your questions. Structural monetary policy instruments have attracted a lot of attention. Just now, Ms. Ruan and I mentioned this topic briefly, and here I would like to give you a more detailed introduction.
Since the beginning of this year, the PBC has introduced three new structural monetary policy instruments. The first is a science and technology innovation re-lending program, which aims to support high-tech enterprises, specialized and sophisticated small and medium-sized enterprises that produce new and unique products, national technology innovation demonstration enterprises, and single-product champion enterprises. The second is a re-lending arrangement for elderly care services, which focuses on supporting eligible institutions to provide publicly-accessible elderly care services and increase their supply. The third is a re-lending program for transport and logistics, which mainly helps highway cargo transport enterprises, truck drivers, and other businesses and individuals greatly affected by the epidemic. In Q4 of last year, the PBC introduced carbon-reduction supporting tool funds and special re-lending to support the clean and efficient use of coal, which are both phased tools. For long-term ones, we issued re-lending and rediscount policies to support agricultural and small enterprises. At present, the toolbox of structural monetary policy has been enriched and improved.
Generally speaking, structural monetary policy instruments focus on key sectors, adopt reasonable and moderate approaches, and build up ample room for maneuver. Meanwhile, a new working mechanism was set up, under which financial institutions are allowed to independently lend money and manage ledgers, the PBC should conduct reimbursement based on an ex-post basis and place a cap on total lending, and relevant departments should specify the purpose of lending and conduct random checks. By doing so, financial institutions are encouraged to optimize their credit structure, and so that their lending can tilt toward key areas, including inclusive finance, green development, and scientific and technological innovation.
So far, the PBC had already allocated 182.7 billion yuan in carbon-reduction supporting tool funds and helped banks to offer 304.5 billion yuan of loans on carbon reduction, which led to over 60 million metric tons of carbon emission reductions. A clean-coal financing program has lent 43.9 billion yuan to businesses. The three new structural monetary policy instruments will be issued on a quarterly basis and will open for application for the first time in July. Currently, the PBC is fast-tracking related procedures.
Next, in accordance with the strategic deployments of the CPC Central Committee and the State Council and the arrangements of a State Council executive meeting, the PBC will continue to make full use of the dual functions of all structural monetary policy instruments so as to better bolster key areas and weak links in the economy. Thank you.
_ueditor_page_break_tag_Bloomberg:
I have two questions. My first question is, do you see any need or room for the LPR to be lowered in the second half of this year? My second question is, considering the outbreak of civil unrest in Henan due to people being unable to access their savings and the increasingly bad financial position of local government financing vehicles, are you worried about financial risks in the banking system? Do you expect more problems like Henan, and are you worried about the reports that more and more people aren't paying their mortgages? Thank you.
Zou Lan:
In regard to your first question, I will give an introduction about the recent work and effects of the market-based interest rates reform.
In April this year, the PBC guided the establishment of a market-based mechanism to adjust deposit rates in order to promote the further marketization of deposit rates. Members of interest rates self-regulatory mechanism can independently determine their deposit rates reasonably by referring to bond market interest rates represented by yields on China's 10-year government bonds and loan market interest rates represented by one-year LPR. Since the mechanism was established, banks have adjusted their deposit rates based on changes in market-based interest rates. According to our preliminary statistics, in June, the weighted average interest rate of new deposits in banks was about 2.32%, 0.12 percentage points lower than that in April before the adjustment. The establishment of market-based deposit rates adjustment mechanism has significantly improved the pricing capability of market-based deposit rates, maintained a good and competitive deposit market order, stabilized the cost of bank debt, and prompted the reduction of real loan rates so as to better support the development of the real economy.
At the same time, in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, the PBC has established and improved the formation and transmission mechanisms for market-oriented interest rates in recent years. We have formed a transmission mechanism where the market interest rates and central bank's guidance affect LPR and then influence loan and deposit interest rates, thus significantly improving the transmission efficiency of monetary policy. Next, the PBC will continue to deepen market-based interest rates reform, consistently unleash the potential of LPR reform, give play to the mechanism of market-based adjustment of deposit interest rates, fully leverage the role of the interest rate self-discipline mechanism, maintain orderly market competition, and promote a further reduction in the actual interest rates of loans to make the market entities benefit from the actual decline in overall financing costs. That's all for my answer, and I think a perspective from the overall developments in market-oriented interest rates may help explain it more clearly.
Sun Tianqi:
I will answer your second question. Since some rural banks in Henan province were found to be a part of a suspected financial scam, the PBC has actively cooperated with local governments and regulatory authorities to deal with the problem correctly. It has guided its branches to fulfill their duties of maintaining regional financial stability and worked hard to deliver liquidity risk monitoring and emergency support. Overall, China's financial risks have been mitigated and controllable, with 99% of banking assets within the safe boundary. By the end of 2021, the total assets of China's banking institutions reached 345 trillion yuan, accounting for 90% of the total assets of the entire financial industry. It is said that "banking stability means financial stability." The PBC's credit rating results in the fourth quarter of 2021 showed that among the 4,398 participating banking institutions, 4,082, or 93%, were rated at levels of 1-7 and within the safe boundary, making up 99% of total assets of the participants. Among them, 24 large banks have always kept their ratings within the excellent and good levels of 1-5, with their assets accounting for 70% of the total and serving as the ballast of the entire financial industry. There were 316 high-risk institutions rated at 8-D, accounting for 7% of the participating banks but only 1% of the total assets. That is to say, the vast majority of small and medium-sized banks are within the safe boundary in the central bank's credit ratings. Given the data, I hope friends from the media can also report the 4,000-plus banking institutions with favorable ratings while covering the high-risk ones to jointly give all parties an objective, comprehensive and accurate judgment of the overall financial risks. Thank you.
_ueditor_page_break_tag_China Media Group:
My question is about the newly added credit and social financing. What have been the changes in the general trends in financial data starting from this year? What are the structural features of the newly added credit and social financing increment? What are the expected changes in the field in the second half of this year? Thank you.
Ruan Jianhong:
I will answer your question. The data in the first half of this year showed that the current financial operations are stable on the whole, the financial aggregate grows steadily, the liquidity is reasonably ample, and the support for the real economy is further strengthened. In the first half of this year, new RMB loans registered 13.68 trillion yuan, 919.2 billion yuan more than the same period last year. An additional 21 trillion yuan of social financing was achieved, 3.2 trillion yuan more than the same period last year.
Regarding the structure of social financing, there are three notable features. First, financial institutions are increasing their credit support for the real economy. In the first half of this year, RMB loans issued by financial institutions to the real economy increased by 13.58 trillion yuan, 632.9 billion yuan more than the same period last year. Second, the direct financing of enterprises grew steadily. Net enterprise bond financing and stock financing amounted to 1.95 trillion yuan and 502.8 billion yuan, respectively, 391.3 billion yuan and 7.3 billion yuan more than in the same period last year. Third, the financial system actively complied with fiscal policies, and the special-purpose bond financing of local governments increased remarkably. Net government bond financing stood at 4.65 trillion yuan, 2.2 trillion yuan more than the same period last year, with special-purpose bonds financing of local governments reaching 3.39 trillion yuan, 2.23 trillion yuan more than the same period last year.
In terms of the loan structure, first, enterprises and public institutions are getting more support. In the first half of this year, RMB loans to enterprises and public institutions went up by 11.4 trillion yuan, 3.03 trillion yuan more than the same period of last year. Second, the growth of loans slowed in the household sector, indicating that the repeated resurgence of the epidemic in the first half of the year had impacted household consumption to some degree. Household loans increased by 2.18 trillion yuan, 2.39 trillion yuan less than the same period last year. Among these, the consumer and business loans grew by 646.8 billion yuan and 1.54 trillion yuan, respectively, 2.13 trillion yuan and 264.4 billion yuan less than the same period last year.
Next, the PBC will employ various monetary policy tools in a timely and flexible manner to better play their dual roles of adjusting both the monetary aggregate and structure. It is expected that the credit supply and social financing scale will both maintain steady growth. Thank you.
_ueditor_page_break_tag_Yicai:
How will the PBC judge the economic trend in the year's second half? How will monetary policy support and stabilize the economy in the year's second half? Are there enough tools to deal with unexpected changes? Are there any plans for the interest rate or RRR cuts? Thank you.
Zou Lan:
Let me answer your questions. Since May, under the leadership of the CPC Central Committee and the State Council, with the overall improvement of the domestic epidemic situation, the State Council has accelerated the implementation of a package of measures to stabilize the economy. Fiscal policy, monetary policy, and industrial policy have all stepped up implementation, the national economy has tended to improve, and major economic indicators have marginal improvement. However, the foundation for recovery is not yet solid, and the economic operation in the year's second half still faces great uncertainty and instability. Hard efforts are still needed to stabilize the economy, and at the same time, attention must be paid to changes in the inflation situation.
In recent years, we have adhered to a normal monetary policy, leaving sufficient policy space and tool reserves to deal with new challenges and changes beyond expectations. In the second half of the year, the PBC will continue to implement a sound and prudent monetary policy and accelerate the implementation of the established policy measures, including implementing various structural monetary policy tools introduced earlier and guiding financial institutions to enhance the ability of providing financial services to serve the real economy following the market-based and rule-of-law principles. We will guide policy-oriented development banks to implement an additional 800 billion yuan in the scale of credit loans and set up financial tools of 300 billion yuan to support infrastructure construction. We will complete the annual turn-in of surplus profits to the central government ahead of schedule to help stabilize the overall economy, stabilize employment and ensure people's living standards.
Regarding the RRR cut and interest rate cut you asked about, at present, the weighted average interest rate on 7-day repos between depository institutions in the interbank market, which is what we often call DR007, is currently around 1.6%, which is lower than the rate in the open market operation. Liquidity is maintained at a level that is reasonably sufficient but slightly excessive. From January to June, the corporate loan interest rate was 4.32%, a year-on-year decrease of a 0.31 percentage point, which continues to stabilize with some declines, hitting a new low since statistics. In the future, in accordance with the deployment of the CPC Central Committee and the State Council, the PBC will comprehensively consider economic growth, price conditions, and other fundamentals, rationally match monetary policy tools, maintain reasonably ample liquidity, further promote financial institutions to reduce corporate financing costs, and create a suitable monetary and financial environment for consolidating economic recovery.
We paid great attention to the accelerated tightening of the monetary policy in major economies. We have taken forward-looking measures such as adjusting the foreign exchange deposit reserve ratio and strengthening macro-prudential regulation of cross-border capital flows in the early stage, reducing the negative spillover impact caused by changes in the external environment to a certain extent. The RMB exchange rate fluctuated in two ways and remained at a reasonable level, and cross-border capital flows were generally stable. At the same time, as a super-large economy, China's domestic monetary and financial conditions are mainly determined by domestic factors. The monetary policy will continue to adhere to the orientation of self-centeredness, considering internal and external balance. Thank you.
_ueditor_page_break_tag_China Daily:
In the first half of the year, in which areas did the PBC increase risk prevention and management? What results have been achieved? What is the risk management situation of high-risk financial institutions? What is the focus of work in the second half of the year? Thank you.
Sun Tianqi:
Thank you for your questions. Under the strong leadership of the CPC Central Committee and the State Council, the PBC, together with relevant departments and local governments, followed the basic principles of maintaining overall stability, ensuring coordination, implementing category-based policies, and defusing risks through targeted efforts, fought a tough battle to prevent and defuse major financial risks, and achieved important phased results. The rapid rise in the macro leverage ratio has been effectively curbed. We resolutely disposed of high-risk enterprise groups and high-risk financial institutions, comprehensively cleaned up and rectified the financial order, and effectively reduced the risks of "shadow banking." Financial anti-corruption efforts have been significantly intensified. We strengthened our financial services to serve the real economy and effectively responded to many challenges, such as the COVID-19 pandemic. On the whole, financial risks are restrained and generally controllable, while 99% of banking assets are within the security boundary, and the central bank ratings of most small and medium-sized banks are within the security boundary.
Facing the current complex international and domestic economic and financial situation, financial administration departments must maintain a high degree of vigilance against various financial risks, further lay a solid foundation for preventing and defusing financial risks, and firmly hold the bottom line that systemic financial risks do not occur. The first is to further improve the effectiveness of micro-prudential supervision, continue strengthening the conduct supervision of the financial industry, and strengthen protections for consumers and investors. The second is implementing different classified policies and continuously resolving key financial institutions' risks. The third is to discover early all kinds of illegal business activities that the people detest deeply, identify them accurately, and act resolutely. The fourth is to continue to replenish the capital to small and medium-sized banks through various channels such as local government special bonds, improve corporate governance, and reduce the number of high-risk financial institutions. We will strive to reduce the number of high-risk financial institutions nationwide to fewer than 200 by the end of the 14th Five-Year Plan period. Thank you.
_ueditor_page_break_tag_21st Century Business Herald:
Why can M2 growth rate maintain a high level? How should we view it? Thank you.
Ruan Jianhong:
I will answer it. At the end of June, the M2 money supply reached 258.15 trillion yuan, an increase of 11.4% year on year, and the growth rate was 0.3 and 2.8 percentage points higher than that at the end of last month and the same period of the previous year, respectively. In terms of deposits, in the first half of this year, RMB deposits increased by 18.82 trillion yuan, a year-on-year increase of 4.77 trillion yuan.
At present, RMB deposits have increased more, and the growth rate of M2 is relatively high, mainly due to the efforts of the financial system to serve the real economy, which leads to an increase in derived currencies.
First, financial institutions support the earlier issuance of government bonds. In the first half of the year, the bond investment of financial institutions increased by 4.68 trillion yuan, a year-on-year increase of 2.82 trillion yuan, of which investment in government bonds increased by 2.72 trillion yuan.
Second, various loans increased steadily. In the year's first half, various loans increased by 13.68 trillion yuan, a year-on-year increase of 919.2 billion yuan.
Third, the central bank turned over 900 billion yuan of profits to increase the financial resources available to the government. After fiscal expenditure, the M2 increased by about 0.4 percentage point.
In addition, this year's monetary and fiscal policy was coordinated well, and the pace of fiscal expenditure accelerated, promoting the increase in the M2 growth rate. In the first half of the year, fiscal deposits increased by 506.1 billion yuan, a decrease of 433.8 billion yuan year on year. Thank you.
_ueditor_page_break_tag_Red Star News:
In the first half of the year, what measures have been introduced to help enterprises overcome difficulties and support the development of small, medium, and micro enterprises? How well do they work in stabilizing the economy? Will there be other policies in the next stage? Thank you.
Zou Lan:
I will take your question. Since the beginning of this year, in accordance with the decisions and plans of the CPC Central Committee and the State Council, the PBC has taken the initiative to use monetary policy tools to adjust both the monetary aggregate and the monetary structure early on, increase liquidity provision, strengthen the use of structural monetary policy tools, and enhance the capacity of financial institutions serving the real economy. In addition, we have introduced several policy measures to fully support steady economic growth, keep the operations of market entities stable, and promote employment stability.
First, we have strengthened policy support for enterprises in industries affected by the epidemic. Cooperating with relevant departments, we have issued 23 measures to provide financial services for epidemic prevention and control and to promote economic and social development. We have issued other policies and measures to help businesses in difficulty recover in the service sector, including the restaurant industry. We have also scaled up support for small, medium, and micro enterprises. By implementing measures such as deferred repayment of principal and interest, we have supported businesses facing difficulties in offsetting the impact of COVID-19.
Second, we have strengthened the multi-level coordination between government, banks, and enterprises. We have strengthened coordination with the National Development and Reform Commission (NDRC) and the Ministry of Industry and Information Technology (MIIT) to promote the sharing and application of credit information and smooth the connection between banks and enterprises through in-person visits and news feed on online service platforms. A national list of 648,000 companies in industries and core supply chain companies affected by the epidemic has been drawn up, with a total of 9.6 trillion yuan of loans offered.
Third, we have deeply carried out projects to improve the financial service capabilities of small, medium, and micro enterprises. We have promulgated a notice on promoting the establishment of a long-term mechanism for financial services for small and micro enterprises to see that they are confident, willing, and able to grant loans, further optimized resource allocation, and improve policy arrangements such as ensuring that those who have fulfilled their duties are not held accountable, increasing the tolerance for non-performing loans, internal fund transfer pricing, and differentiated evaluation of the performance. We have strengthened technological empowerment and product innovation and enhanced financial institutions' willingness, ability, and sustainability to serve SMEs.
Fourth, we have expanded diversified financing channels. We have supported the issuance of special financial bonds for small and micro enterprises. In the first half of the year, a total of 215.5 billion yuan was issued, which effectively broadened the sources of credit funds for small and medium-sized banks. The Credit Reference Centre of the PBC promoted the Account Receivables Financing Service Platform and gave play to the role of the supply chain bill platform. At the end of June, a total of 365,000 account receivables financings were facilitated, with an amount of 16.7 trillion yuan.
In general, the quality and efficiency of financial services for the real economy have been further improved, and inclusive loans to small and micro enterprises continued to "increase in volume, expand in coverage, and decrease in price." Ms. Ruan also introduced relevant data just now. In May, the weighted average interest rate of newly issued inclusive loans to small and micro enterprises was 5.19%, a decrease of 5 basis points from the previous month.
Next, the PBC will strengthen cooperation with the NDRC, MIIT, and the Ministry of Finance, continue to thoroughly implement policies that have been issued and increase support for the development of industries and enterprises affected by the epidemic, especially small and micro enterprises. These measures will boost the confidence of market players and help maintain stable macroeconomic performance. Thank you.
Xing Huina:
If there are no more questions, today's press conference will be concluded here. Thank you to the three speakers and friends from the media. Goodbye.
Translated and edited by Liu Qiang, Zhou Jing, Xu Kailin, Huang Shan, Xu Xiaoxuan, Zhang Rui, Wang Yiming, He Shan, Lin Liyao, Wang Qian, Zhang Liying, Yang Xi, Li Xiao, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Li Kuiwen, spokesperson of the General Administration of Customs of the People's Republic of China (GACC) and director general of the GACC's Department of Statistics & Analysis
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
July 13, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the SCIO. This is a routine press conference on China's annual economic standing. Today, we are delighted to be joined by Mr. Li Kuiwen, spokesperson of the GACC and director of the GACC's Department of Statistics & Analysis, who will introduce China's import and export performance in the first half of 2022 and answer your questions.
We will first invite Mr. Li Kuiwen to give a brief introduction.
Li Kuiwen:
Ladies and gentlemen, friends from the media, good morning. It's a great pleasure to meet with you at today's press conference. I'll begin by introducing China's import and export performance in the first half of 2022, and then answer your questions.
In the first half of 2022, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, China has efficiently contained the pandemic while ensuring socioeconomic development. China has strived to maintain stable macroeconomic performance and achieved steady growth in foreign trade. According to statistics from the GACC, China's foreign trade volume in goods in the first half of 2022 jumped 9.4% year on year to 19.8 trillion yuan. Exports grew by 13.2% to 11.14 trillion yuan, and imports increased by 4.8% to 8.66 trillion yuan. Specifically, there were five main features which I will now outline.
First, foreign trade growth in May and June picked up significantly. As the epidemic prevention and control situation improves and pro-growth policies are taking effect, foreign trade enterprises have resumed work and production in an orderly manner since May. In particular, the rapid recovery of imports and exports in the Yangtze River Delta region led to a marked rebound in the overall growth of China's foreign trade. China's foreign trade volume in goods in May was up by 9.5% year on year, 9.4 percentage points higher than in April, and further increased by 14.3% in June.
Second, the proportion of general trade continued to increase. In the first half of 2022, China's general trade rose by 13.1% to 12.71 trillion yuan, accounting for 64.2% of China's total foreign trade volume, 2.1 percentage points higher than the same period last year. Exports increased by 19% to 7.16 trillion yuan, and imports grew by 6.5% to 5.55 trillion yuan. During the same period, processing trade rose by 3.2% to 4.02 trillion yuan.
Third, imports and exports with major trading partners kept growing. In the first half of 2022, China's trade with ASEAN, the EU and the United States reached 2.95 trillion yuan, 2.71 trillion yuan and 2.47 trillion yuan, up by 10.6%, 7.5% and 11.7%, respectively. During the same period, trade with countries along the Belt and Road and RCEP trading partners grew by 17.8% and 5.6%.
Fourth, foreign trade entities have been further thriving. In the first half of 2022, there were 506,000 foreign trade enterprises in China involved in exports and imports, an increase of 5.5% year on year. The number of private enterprises in China rose by 6.9% to 425,000 with imports and exports increasing by 13.6% to 9.82 trillion yuan, accounting for 49.6% of the country's total, 1.9 percentage points higher than the same period last year. In the same period, imports and exports of foreign-invested enterprises reached 6.75 trillion yuan, up by 2.1%. State-owned enterprises achieved 3.2 trillion yuan in imports and exports, up by 15.2%.
Fifth, imports and exports of major products enjoyed steady growth. In the first half of 2022, China's imports and exports of mechanical and electrical products grew by 4.2% to 9.72 trillion yuan, making up 49.1% of China's total foreign trade. Imports and exports of agricultural products grew by 9.3% to 1.04 trillion yuan, accounting for 5.2% of China's total. Exports of labor-intensive products grew by 13.5% to 1.99 trillion yuan, making up 17.8% of China's total exports. Imports of energy products including crude oil, natural gas and coal were up by 53.1% to 1.48 trillion yuan, accounting for 17.1% of China's total imports.
In general, China's foreign trade showed strong resilience in the first half of the year. The first quarter got off to a relatively good start. In May and June, the downward trend of growth in April was quickly reversed, laying a solid foundation for the stability and improvement of foreign trade throughout the year. At present, as the COVID-19 situation and international environment have become more severe and complex, China's foreign trade is still facing some instability and uncertainty and a lot of pressure to maintain stability and improve quality. However, it should also be noted that the fundamentals of China's economy — its strong resilience, huge potential and long-term sustainability — remain unchanged. With the implementation of a package of policies and measures to stabilize the economy, and the orderly resumption of work, China's foreign trade is expected to continue maintaining steady growth.
Next, we will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the spirit of the 19th CPC National Congress and the plenary sessions of the 19th CPC Central Committee, and conscientiously implement the important guidelines made by General Secretary Xi Jinping that, "we must contain the epidemic, stabilize the economy and keep development secure." We will efficiently coordinate epidemic prevention and control measures with socioeconomic development, resolutely implement the various deployments of the national video and telephone conference on stabilizing the economy, focus on "guarding the country's borders and promoting development," strengthen supervision and optimize services, and strive to promote the stability and improvement of foreign trade. These efforts will enable us to pave the way for a successful 20th CPC National Congress.
Now, I would be happy to answer your questions.
Shou Xiaoli:
Now the floor is open for questions. Please identify the media outlet you represent before raising questions.
_ueditor_page_break_tag_Zhonghongwang.com:
Since the beginning of this year, the country has adopted a package of policies and measures to stabilize economic growth. Could you share with us the specific actions the GACC has taken to ensure steady, quality, and efficient growth in foreign trade? What results have been achieved so far? Thank you.
Li Kuiwen:
Thank you for your questions. This year, following the guiding principles of the Central Conference on Economic Work, the National Teleconference on Ensuring Stable Economic Performance, and the arrangements of the State Council to promote stable and quality growth in foreign trade, the GACC has rolled out ten measures to stabilize foreign trade and improve its quality, as well as efforts to help enterprises further ease difficulties and lower costs. Local customs branches adopted 854 detailed support measures in light of their specific conditions and the needs of the enterprises. The major measures are as follows:
We are, first, improving logistics efficiency. We have expanded nationwide the pilot practices of enterprises picking up imported goods directly from the ships upon the ships' arrival at the ports and directly loading exported goods onto vessels at the ports by going through the required procedures in advance. We also promoted in Nanjing, Hangzhou, and Ningbo the practice of enterprises confirming certain required information at a time more efficient for transiting imported goods to a new port after testing the practice in Shanghai and Chongqing on a pilot basis. In addition, we have carried out whole-process supervision for the customs clearance of vaccines. We now check the declaration information from enterprises early so that COVID-19 vaccines will not have to be unpackaged for examination or to wait for departure at the ports. Moreover, we set up "green channels" across the nation to import and export fresh and perishable agricultural products and food items.
Second, we are stabilizing industrial and supply chains. We have guaranteed customs clearance for whitelisted enterprises of key industrial and supply chains. Measures have been taken to facilitate food import and diversify the import sources. We signed quarantine requirement protocols for importing corn from Myanmar, soybean from Malawi, and corn and peanut from Brazil. We have also promoted exporting quality agricultural products from RCEP members to China. In addition, efforts have been made to help ensure the import of major commodities such as iron ore and cotton to guarantee domestic demand.
Third, we are stabilizing market entities. In the first half of this year, we completed the registration of 73,700 overseas manufacturing enterprises of imported goods in China. We shortened the record filing time of manufacturing enterprises of exported food and completed record filing for 23,500 such enterprises. We accelerated the review of applications for record filing of customs protection of IP rights, and 10,700 records were filed, a year-on-year increase of 58%. Furthermore, we suspended the interest for tax delay for goods of processing trade to be sold in the domestic market, and 14,600 enterprises have benefited from the suspension.
Fourth, we are improving the business environment of ports. We carried out a five-month special campaign to facilitate cross-border trade in 10 cities of eight provincial-level regions by launching ten trade facilitation measures with relevant departments. We further improved the single-window document processing for international trade to consolidate our achievements in shortening customs clearance time. Following China's reform to streamline the government, delegate power, and improve government services, we have guided over 90,000 enterprises to file records with the customs authority with one unified business license. We have also promoted the reform of integrating all types of customs services, further facilitating foreign trade.
_ueditor_page_break_tag_CCTV:
Mr. Li, you just said that China's foreign trade had achieved steady growth in H1. What do you think are the drivers behind it? Do you think the growth momentum can be maintained in the second half of this year? How do you forecast China's foreign trade in H2? Thank you.
Li Kuiwen:
Thanks for your questions. In H1, China's foreign trade grew steadily, maintaining positive growth for eight consecutive quarters. The foreign trade volume has grown steadily to 19.8 trillion yuan (US$2.95 trillion), which has contributed to a stable macroeconomic performance. The growth of China's foreign trade, in my opinion, is attributed to the following aspects:
First, the international market demand is relatively stable. Since this year, despite the rising external risks caused by the COVID-19 pandemic and the Ukraine crisis, the global economy is generally picking up, and the international market demand is stabilized. In H1, China's export of electrical equipment and products, integrated circuits, and automobiles have increased by 24.8%, 16.4%, and 51.1%, respectively. The export of labor-intensive products like textiles and garments, plastic products, and footwear rose by 10.8%, 14.9%, and 31.4%, respectively.
Second, the demand for domestic production is high. This year, faced with a complex external environment and economic downside pressure brought by the COVID-19 pandemic, the CPC Central Committee has effectively coordinated epidemic control and socioeconomic development, which has helped stabilize the macroeconomic performance. The demand for domestic production gradually recovered, providing strong support for import growth. In H1, China's import in copper products, basic organic chemical products, and integrated circuits grew by 16.2%, 7.9% and 5.5%, respectively.
Third, the rapid recovery of import and export in some regions have firmly stabilized the overall state of China's foreign trade. This year, the Yangtze River Delta region, the Pearl River Delta region, and China's northeast had seen cluster cases of COVID-19, which has resulted in the slump of their foreign trade. But after the epidemic has been quickly taken under control, these regions have seen a rapid recovery in foreign trade with growth rates turning negative to positive. Their strong resilience in foreign trade have also helped stabilize China's overall foreign trade performance. In May, these three regions have seen their imports and exports grow by 4.8%, 2.8%, and 12.2% year-on-year, respectively, and their growth rate further picked up to 14.9%, 6.4%, and 12.8% year-on-year in June, respectively.
Fourth, the vitality of market entities has been effectively stimulated. As the country's policy measures to stabilize the economy have taken effect, the work related to increasing both the volume and quality of imports and exports is rapidly progressing, and the vitality of market entities in China's foreign trade market have been effectively stimulated. In H1, the number of companies with visible progress in foreign trade grew by 5.5% year on year. Various businesses in foreign trade maintained growth in both imports and exports. The import and export of private enterprises grew by 13.6%, 4.2 percentage points higher than the average growth, and these private businesses have contributed 6.5 percentage points to the growth of China's foreign trade.
Moreover, the high international commodity prices, to some extent, have also driven the growth of import value. In H1, the Thomson Reuters/CoreCommodity CRB Index, which reflects the fluctuations of international commodity prices, has grown by more than 25%. Against this background, the average import prices for crude oil, natural gas, and coal visibly picked up and have driven the growth rate of the overall import value.
I won't repeat my forecast on future foreign trade because my earlier remarks have already covered this part. It is fairly to say that China's foreign trade is faced with some instabilities and uncertainties, as well as some positive factors. I think we are still on a solid foundation to steadily increase both the volume and quality of imports and exports. Thank you.
_ueditor_page_break_tag_Phoenix TV:
You mentioned that imports and exports in the Yangtze River Delta region have rebounded rapidly. Could you explain the situation in more detail? And what work has the GACC done to promote the local recovery of foreign trade? Thank you.
Li Kuiwen:
Thank you for your questions. According to statistics of the GACC, in the first half of 2022, the imports and exports in the Yangtze River Delta region, including Jiangsu, Anhui and Zhejiang provinces, as well as Shanghai, reached 7.14 trillion yuan, an increase of 9.3% year on year. In June, the region's imports and exports rose 14.9% year on year to 1.39 trillion yuan, 0.6 percentage point higher than the overall growth rate of the country in the same period, contributing nearly 40% to the growth of foreign trade. Specifically, in June, imports and exports of Anhui province, Jiangsu province and Zhejiang province increased 19.7%, 17.5% and 16% respectively, which were 5.4 percentage points, 3.2 percentage points and 1.7 percentage points higher than the overall growth rate of the country in the same period. Shanghai has been severely affected by the epidemic. In June, its imports and exports regained positive growth, up 9.6% year on year and 35.6% month on month.
During this period, we have thoroughly implemented the decisions and arrangements of the CPC Central Committee and the State Council, set up special task groups to strengthen coordination and promotion, and introduced special supporting measures to ensure smooth customs clearance and promote the development of foreign trade in the Yangtze River Delta region. We have adopted four main approaches:
First, we have prioritized ensuring front-line human resources. Shanghai Customs promptly arranged working groups to enter key ports such as those in harbors and airports at the earliest opportunity during the regional lockdown in Shanghai. Over 1,300 officers and staff at customs operation sites stayed at their posts to ensure normal operation and improve the operation efficiency of Shanghai's ports.
Second, we have helped enterprises engage in rapid customs clearance. We have prioritized the approval and inspection of imported goods necessary for people's everyday lives, such as grain, meat and natural gas. For emergency supplies, such as medical supplies, first-aid equipment and spare parts, we worked closely with enterprises throughout the whole process. We provided guidelines for them to make inspection appointments online and implemented unaccompanied inspections for rapid customs clearance. We also established a coordination work mechanism to ensure smooth customs clearance in the Yangtze River Delta region. Targeted measures have been implemented to speed up the circulation of goods for import and export in the region. We set up a customs clearance green channel for key supplies from key enterprises, created information sharing platforms, and ensured the rapid customs clearance of goods for import and export in Shanghai ports during the epidemic outbreak.
Third, we have actively helped to smooth foreign trade logistics. We promoted expansion of the supervision model of directly transferring goods between maritime transport vessels and Yangtze River transport vessels, and sped up customs clearance for urgently needed goods. At eligible ports, we have advanced trials of direct unloading for imported goods and direct loading for export goods. Going forward, we will further advance the customs supervision model of waterway logistics in key areas of the Yangtze River Delta region, support expansion of the pilot of departing confirmation model, and continuously improve the efficiency of waterway logistics. We will support enterprises to open rapid customs clearance rail services and improve the facilitation of railway logistics in China.
Fourth, we have coordinated and solved problems reported by enterprises. We have improved the long-term mechanism for serving enterprises, actively coordinated and promoted solving problems and demands of enterprises, effectively guaranteed customs clearance of goods for import and export for white list enterprises, helped enterprises solve difficulties, and ensured the safety, stability and smooth running of industrial and supply chains.
Next, we will continue to implement the deployment requirements of the State Council to ensure logistics run smoothly and maintain the stability of industrial and supply chains, and fully support enterprises to resume work and production. Thank you.
_ueditor_page_break_tag_Bloomberg:
You have just talked about the measures that the GACC has taken to boost imports and exports. My question is mainly about overseas demand. As we have seen, the United States, European, and many other countries are facing the risk of recession, with their global demand declining. What do you think of the growth in international demand in the coming year? My second question is: How do you view the future export growth without regarding the price factor? Thank you.
Thank you for your questions. As I have just said, the international market demand maintained relatively stable, which has opened up broad space for China's export. As for the trend of the second half of the year, as I have said, China's economy is strong and has great potential, and the long-term economic growth remains unchanged. Although there are still some unstable and uncertain factors, our domestic production demand is gradually recovering and improving. Besides, enterprises have resumed production at a fast pace. Therefore, imports and exports will maintain steady growth in the second half of the year. Thank you.
_ueditor_page_break_tag_Beijing Youth Daily:
How did China's imports and exports with other BRICS countries go in the first half of the year? What efforts have been made by the customs in promoting the economic and trade development between China and other BRICS countries? And how do you evaluate the prospect? Thanks.
Li Kuiwen:
Thank you for your questions. As the BRICS chair this year, China held the 14th BRICS Summit recently. Here I would like to make an introduction about our trade with other BRICS countries. Since the BRICS Summit started in 2009, China has seen increasing trade with other BRICS countries, and the imports and exports registered 3.17 trillion yuan in 2021 from 960.21 billion yuan in 2009, with an average annual growth of 10.5%. In the first half of the year, China's imports and exports with other BRICS countries totaled 1.64 trillion yuan, up 14.1% year on year, 4.7 percentage points higher than China's total foreign trade growth. Among them, exports leaped by 20.6% to 817.18 billion yuan; imports jumped by 8.3% to 825.82 billion yuan. Specifically, it shows the following features:
First, China's trade with other BRICS countries has registered a steadily increasing proportion in its total foreign trade. In the first half of the year, China's imports and exports with other BRICS countries accounted for 8.3% of its total foreign trade, up 0.2 percentage point from 2021 and 1.9 percentage points from 2009.
Second, imports of energy and agricultural products grew rapidly. In the first half of the year, China imported 298.98 billion yuan of crude oil, natural gas, coal, and other energy products from other BRICS countries, up 53.3%, accounting for 36.2% of its total imports with other BRICS countries; China's imports of agricultural products expanded 15.6% to 185.46 billion yuan, accounting for 22.5% of its total imports with other BRICS countries.
Third, exports of mechanical and electrical products accounted for more than half, and exports of new energy products increased significantly. In the first half of the year, China's exports of mechanical and electrical products to other BRICS countries reached 455.5 billion yuan, up 16.2%, accounting for 55.7% of the total exports to these countries. Exports of solar and lithium-ion batteries increased by 99.7% and 67.3%, respectively. In the same period, exports of labor-intensive products reached 106.65 billion yuan, up 7.3%.
I would like to take this opportunity to introduce the recent work of customs authorities in promoting the economic and trade development of China and other BRICS countries.
The GACC successfully organized a series of events this year, including a meeting of BRICS heads of customs administrations, customs working group arrangements, and customs enforcement cooperation seminars to promote pragmatic cooperation among BRICS countries in various fields. Relevant achievements have been brought into the 14th BRICS Summit Beijing Declaration. We have made our efforts in the following four aspects:
First, the legal basis for customs cooperation has been enhanced. We actively facilitated the Agreement Between the Governments of BRICS Countries on Cooperation and Mutual Administrative Assistance in Customs Matters. This will provide a solid legal basis for BRICS countries to carry out mutual administrative assistance, capacity building, law enforcement cooperation, and jointly safeguard trade security and facilitation.
Second, an intelligent cooperation consensus has been reached. Upholding the philosophy of cooperation of smart customs, smart borders, and smart connectivity, we promoted the construction of smart infrastructure for customs exchanges of BRICS countries and the smart practice of supervision and administration, carried out coordinated cross-border governance of border administration departments step by step, promoted smart connectivity and alignment of standards among customs authorities and other stakeholders along supply chains to boost connectivity of industrial and supply chains.
Third, customs law enforcement cooperation has been deepened. Guided by the principle of collaboration, co-governance, and common gains, we built a customs enforcement contact platform and capacity-building platform for BRICS countries. We promoted cooperation in areas of information exchanges and joint actions. We enabled smart collaboration to empower customs law enforcement, discussed the application of bid data analysis and artificial intelligence in law enforcement, and enhanced the law enforcement capacity to deal with new forms of smuggling to jointly build a defense line of customs with other BRICS countries.
Fourth, cooperation on customs capacity building has been strengthened. Making full use of the customs training center of BRICS countries in Xiamen, we carried out training exchanges and prepared for a strategic seminar on customs capacity building of BRICS countries. We promoted capacity-building cooperation in customs technologies, joint law enforcement, and talent training.
Next, customs authorities will conscientiously implement the guiding principles of General Secretary Xi Jinping's speech at the 14th BRICS Summit. We will comprehensively deepen international customs cooperation among BRICS countries and further promote the economic and trade development of our country and other BRICS countries. We are full of confidence in the future economic and trade development of the BRICS countries.
Thank you!
_ueditor_page_break_tag_TV Tokyo:
China's customs have not released the quantity of pipeline gas imported from Russia since January this year, and we would like to know this data. Also, what is the reason for not releasing the data? What do you think of the recent China-Russia trade? Thank you.
Li Kuiwen:
Thank you for your questions. Regarding your first question, since the release of statistical data for 2022, customs have continued to release the amount of gaseous natural gas online, and no longer published the data for multi-dimensional statistical groups other than the total import volume. This is mainly to protect the legitimate commercial rights and interests of relevant import and export consignees and consignors and to meet the needs of various data users for analyzing and using customs statistics. This practice is also in line with the international standards. Internationally, there are many countries that do not publish the amount and value of gaseous natural gas grouped by statistical items such as trading partners. Next, customs will continue to ensure data release and statistical services in accordance with the law.
Regarding your second question, let me brief you on relevant trade data. According to customs statistics, in the first half of this year, China's trade with Russia totaled 519.08 billion yuan, and that with Ukraine 35.3 billion yuan. Thank you.
_ueditor_page_break_tag_Tianmu News:
The ninth edition of COVID-19 prevention and control guidelines has shortened the quarantine time for inbound arrivals, which actually puts forward higher requirements for epidemic prevention and control at points of entry. We want to know how customs are doing in science-based and targeted epidemic prevention? Thank you.
Li Kuiwen:
Thanks for your question. Customs resolutely implement the decisions and plans of the CPC Central Committee and the State Council, adhere to the general strategy of preventing imported cases and domestic resurgences and the general policy of dynamic zero-COVID, and strictly and unremittingly take various measures to prevent and control the epidemic at ports. After the ninth edition of COVID-19 prevention and control guidelines was issued, customs have followed the principles of "ensuring epidemic prevention and control in compliance with the law, enhancing coordination, and taking science-based and targeted measures covering different levels and categories," and focused on optimizing the work processes involving sampling and testing of inbound personnel, the proportion of inbound cargo aircraft randomly boarded for quarantine inspection, the epidemic prevention and control for imported goods, and the closed-loop management system for staff in high-risk positions of customs. Customs organized the revision and release of the ninth edition of the technical plan for COVID-19 prevention and control at ports to guide customs at all levels to continue to do well in the pandemic prevention and control at ports, prevent the cross-border spread of the pandemic, ensure the health and safety of people entering and leaving the country, and avoid unnecessary disruption to international traffic and trade.
Regarding more information, my colleague Li Zhengliang, deputy director general of the department of health quarantine at the GACC, made a detailed introduction at a press conference held by the State Council's inter-agency task force on July 8.
It is worth mentioning that since the outbreak of COVID-19, customs staff across the country have devoted themselves a total of 2.47 million times to epidemic prevention and control on the front line, among which they carried out 86,000 missions entering the closed-loop management area. Every day, more than 3,500 officials wear protective suits to fight the virus directly, and more than 20,000 officials perform their duties on the front line against the epidemic. Having worked for more than 900 days, they practice the great spirit of combating COVID-19 with actions.
Next, the GACC will continue to dynamically improve port quarantine measures in accordance with the unified deployment of the State Council's inter-agency task force, strengthen joint prevention and control, and effectively guard the country's ports.
Thank you!
_ueditor_page_break_tag_CCTV Agricultural Rural Channel:
My questions are to Mr. Li. How was China's export of agricultural products in the first half of this year? What are the highlights? Thank you.
Li Kuiwen:
Thank you for your questions. In the first half of this year, China's export of agricultural products grew by 21.7% year on year to 303.1 billion yuan. Among them, exports of aquatic products rose by 14.9% to 72.52 billion yuan, vegetables and, edible mushrooms rose by 5.5% to 37.79 billion yuan, and canned food rose by 55% to 13.75 billion yuan, respectively. It is fair to say that exports of major agricultural products have maintained a steady growth. In the first half of this year, China's import of agricultural products reached 736.07 billion yuan, a year-on-year increase of 5%. Among them, imports of grain increased by 16.6% to 272.48 billion yuan, accounting for 37% of China's total import of agricultural products during the same period. Import of meat dropped by 16.4% to 89.79 billion yuan, and import of aquatic products rose by 34.1% to 54.08 billion yuan. This is the introduction of China's import and export of agricultural products. Thank you.
Shou Xiaoli:
Last question, please.
_ueditor_page_break_tag_ThePaper.cn:
Private enterprises witnessed an outstanding export performance in the first half of this year, accounting for nearly half of the total. Would you like to elaborate on the features of their import and export performances? Thank you.
Li Kuiwen:
Thank you for your question. Starting this year, China has introduced a series of policies and measures to maintain steady increases in both the volume and quality of imports and exports and help companies to tide over difficulties, which energized the market entities 'dealing in foreign trade. In the first half of this year, the number of foreign trade firms registering import and export business rose by 5.5% year on year. Among them, the number of private enterprises grew by 6.9% to 425,000, posing a better performance than overall growth figures. The major features are as follows:
First, in terms of growth rate, import and export of private enterprises grew by 13.6% to 9.82 trillion yuan in the first half of this year, up 4.2 percentage points compared to overall growth, and its share in China's total imports and exports increased by 1.9 percentage points from the previous year to 49.6%, thus further reinforcing the principal position of private enterprises in China's imports and exports.
Second, in terms of product mix, in the first half of this year, export volume of machinery and electronics products produced by private enterprises grew by 15.3%, 6.7 percentage points higher than overall export growth rate. Import volume of agricultural products, basic organic chemicals, pharmaceutical materials, and medicines increased by 6.4%, 14%, and 33.1%, respectively, all outperformed the overall import growth rate.
Third, in terms of market share, in the first half of 2022, while maintaining the growth of imports and exports with traditional markets such as the U.S., Europe, the ROK, and Japan, private enterprises ratcheted up in expanding emerging markets, with their imports and exports with ASEAN, Latin America, and five Central Asian countries up by 20.5%, 16.4%, and 53.3% respectively, all higher than the overall growth.
It is fair to say that the steady growth of China's imports and exports in the first half of 2022 was largely attributable to the strong vitality of various market entities dealing in foreign trade. We focused on ensuring security in the operations of market entities and introduced 10 measures to maintain steady increases in both the volume and quality of imports and exports. Recently, we introduced another seven measures to further help companies to ease their difficulties and lower their costs. For example, for companies affected by COVID-19 and having difficulties in running businesses, if they couldn't pay their taxes in timely but could pay their overdue payments within a set period of time, these companies can be exempted from overdue fines. The request for third-party examination was removed for companies applying for exemption of tariffs and import-related tax on returned products. The requirement to provide proof of warehouse was canceled for companies applying for a quarantine license on imported fruits. The inspection process of imported coatings was streamlined and the Recordation Form for Imported Coatings was no longer checked. Efforts were also made to adjust and improve the inspection requirements for imported crude oil and coal.
Next, we will implement in earnest the policies and measures to help companies to tide over difficulties and work to maintain the steady increases in both the volume and quality of China's foreign trade. Thank you!
Shou Xiaoli:
Thank you, Mr. Li and friends from the media. Today's press conference is hereby concluded. See you next time.
Translated and edited by Wang Yiming, Wang Qian, Yuan Fang, Liu Qiang, Guo Yiming, Liu Sitong, Yan Xiaoqing, Yang Xi, Zhang Tingting, Wang Wei, Ma Yujia, Zhang Rui, Zhang Liying, Cui Can, Li Huiru, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Guo Lanfeng, member of the Communist Party of China (CPC) Leadership Group of the National Development and Reform Commission (NDRC)
Wang Jianfan, director general of the Budget Department of the Ministry of Finance
Wang Xin, director general of the Research Bureau of the People's Bank of China (PBC)
Zhang Hu, member of the Standing Committee of the CPC Guangdong Provincial Committee and executive vice governor of the People's Government of Guangdong Province
Guo Yonghang, deputy secretary of the CPC Guangzhou Municipal Committee and mayor of the Guangzhou Municipal People's Government
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
June 24, 2022
Xing Huina:
Friends from the media, good afternoon. Welcome to this press conference held by the SCIO. Recently, the State Council issued the Master Plan of Guangzhou Nansha on Deepening Comprehensive Cooperation between Guangdong, Hong Kong and Macao with Global Perspective. This press conference will brief you on the document and take your questions. In addition to the main venue here in Beijing, today's press conference is also being held live in Guangzhou, Guangdong province. Joining us today in Beijing are Mr. Guo Lanfeng, member of the CPC Leadership Group of the NDRC; Mr. Wang Jianfan, director general of the Budget Department of the Ministry of Finance; and Mr. Wang Xin, director general of the Research Bureau of the PBC. We are also being joined live by local officials in Guangzhou, including Mr. Zhang Hu, member of the Standing Committee of the CPC Guangdong Provincial Committee and executive vice governor of the People's Government of Guangdong Province; and Mr. Guo Yonghang, deputy secretary of the CPC Guangzhou Municipal Committee and mayor of the Guangzhou Municipal People's Government.
Now, I'll give the floor to Mr. Guo Lanfeng for his brief introduction.
Guo Lanfeng:
Ladies and gentlemen, friends, good afternoon. Thank you for your interest in and support for the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) and especially the major cooperation platform in Guangzhou's Nansha district. I would like to take this opportunity to express my sincere thanks to friends from all walks of life for their interest and support in the construction of the GBA.
Nansha district enjoys great geographic advantages, enormous development potential and a strong industrial foundation. As Guangzhou, Hong Kong and Macao have strong willingness for cooperation, Nansha bears unique advantages in promoting their comprehensive cooperation. In September 2012, the State Council approved the Development Plan for the Nansha New District of Guangzhou, requiring Nanshan to roll out construction and deepen comprehensive cooperation with Hong Kong and Macao. In February 2019, the Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area further specified Nansha's role in promoting cooperation between Guangdong, Hong Kong and Macao, joining hands with Hong Kong and Macao to build a portal for high-level opening-up, jointly building a demonstration zone for innovative development, establishing a major platform for financial services, and creating a high-quality living environment. In recent years, in accordance with the decisions made by the CPC Central Committee and the State Council and the arrangements of the central leading group for the construction of the GBA, we have worked with Guangdong, Hong Kong, Macao and relevant government bodies to draw up the Master Plan of Guangzhou Nansha on Deepening Comprehensive Cooperation between Guangdong, Hong Kong and Macao with Global Perspective, and submitted it to the State Council for publication and implementation. The Nansha plan was published a few days ago.
The Nansha plan, consisting of seven sections and 26 articles, is a fundamental document to promote Nansha's development. It involves the following aspects:
It has phased objectives for 2025 and 2035, respectively. The plan proposes main targets in the fields of sci-tech innovation systems and institutional arrangements, public service capacity and business environment, to name a few.
It also stipulates five major tasks. First, industrial cooperation bases for sci-tech innovation will be built in Nansha. The master plan stresses strengthening collaboration in sci-tech innovation between Guangdong, Hong Kong and Macao, building major sci-tech innovation platforms, developing high-tech industries and pooling high-level international talents. Second, cooperation platforms for startups and youth employment will be established in Nansha. The master plan requires coordinated measures in promoting youth innovation and entrepreneurship, and calls for efforts to improve support for internships and employment and strengthen people-to-people exchanges among the youth. Third, joint efforts will be made to build Nansha into a portal for high-level opening-up. The master plan stipulates that a comprehensive service base for Chinese enterprises going global will be built in Nansha. Measures will also be taken to enhance Nansha's role as an international shipping and logistics hub, strengthen global economic cooperation and build Nansha into a new platform for international communication. Fourth, a mechanism for aligning rules and regulations will be established in Nansha. The master plan notes that a world-class business environment will be built in Nansha, with efforts promoting connectivity in its financial markets in an orderly manner and improving the coordination between public services and social management. Fifth, Nansha will also be built into a model for high-quality urban development. The master plan stresses increasing cooperation in urban planning and development, steadily promoting smart cities, steadily advancing educational cooperation between Guangdong, Hong Kong and Macao, facilitating medical treatment and elderly care for Hong Kong and Macao residents and intensifying joint efforts in ecological protection and treatment.
The plan also stresses boosting support from four aspects: strengthening Party leadership in a comprehensive manner, increasing policy support such as for funding and other factors, creating new models for cooperation, and intensifying organization and implementation efforts.
The Nansha plan will help inject new vitality into an old city like Guangzhou, make new progress in the city's comprehensive urban functions, cultural capacity, modern service industry and its modern and global business environment, and enhance the city's role as the core and engine for the development of the GBA. The master plan will help improve Nansha's urban services in the areas of shipping, trade, finance and international communication, helping Nansha join hands with Hong Kong and Macao to build a high-level opening-up portal, and allowing it to play a bigger part in promoting and building the new development paradigm. The plan also helps create a major strategic platform for the comprehensive cooperation between Guangdong, Hong Kong and Macao, enriches the practice of "one country, two systems," and supports Hong Kong and Macao's engagement in the country's overall development.
Going forward, we will earnestly implement the decisions made by the CPC Central Committee and the State Council and follow the arrangements of the central leading group for the construction of the GBA. We will work with relevant government bodies to increase communication and coordination, keep track of the progress and spare no efforts to support Guangdong province and Guangzhou city in carrying out the Nansha plan, in a bid to put Nansha's high-quality development on a steady and sustained course.
Thank you.
_ueditor_page_break_tag_Xing Huina:
Thank you. Next, I will invite Mr. Zhang from the Guangzhou branch to give an introduction.
Zhang Hu:
Ladies and gentlemen, friends from the media, good afternoon. Thank you for your care and support for Guangdong's development. On June 14, the State Council officially issued the Master Plan of Guangzhou Nansha on Deepening Comprehensive Cooperation between Guangdong, Hong Kong and Macao with Global Perspective. The plan was also introduced to support turning Nansha into a major strategic platform based on the GBA, coordinate the development between Hong Kong and Macao, and work with a global outlook. Following last year's introduction of plans for cooperation zones in Hengqin and Qianhai, this plan is another major decision and deployment for the building of the Guangdong-Hong Kong-Macao GBA made by the CPC Central Committee with Comrade Xi Jinping at its core, offering Guangdong new major opportunities and missions and injecting new and strong impetus into Nansha's development. We are inspired, encouraged, and motivated. We are more aware of the far-reaching layout of the Party and our country's undertakings made by the general secretary and the Party Central Committee. We also have a deeper understanding of their care for Guangdong and the great historical responsibility Guangdong shoulders. Yesterday, Li Xi, secretary of the Guangdong Provincial Committee of the CPC, presided over the meeting of the standing committee of the CPC Guangdong Provincial Committee, conveyed and studied the master plan, and discussed the opinions on implementing the plan in our province. He stressed that in accordance with the deployment and requirements of the CPC Central Committee, we must fully support further deepening opening up in Nansha to boost the comprehensive cooperation between Guangdong, Hong Kong, and Macao with a global outlook. He also emphasized that we must fully support the establishment of both Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and firmly uphold Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and uphold the Central Committee's authority and its centralized, unified leadership. Today, Wang Weizhong, governor of Guangdong province, presided over the executive meeting of the provincial government and discussed and deployed relevant work. Going forward, we will continue to follow the requirements of the CPC Central Committee, stick to the development direction of the GBA, coordinate the needs of Hong Kong and Macao, and give full play to the role of Guangdong. We will also fully enforce the arrangements of the Party Central Committee and the State Council and work jointly with Hong Kong and Macao to achieve the great goals of the master plan step by step.
First, we will keenly organize people to study, publicize and implement the master plan. We will deeply study and implement the important speeches and guiding principles of the general secretary on the building of the Guangdong-Hong Kong-Macao GBA and for the development of Guangdong and Guangzhou. We will have an in-depth understanding of the significance of the introduction and implementation of the master plan in big-picture terms and from a strategic perspective and accurately grasp the principles and requirements of further deepening opening up in Nansha to boost comprehensive cooperation between Guangdong and Hong Kong, and Macao with a global outlook. We will study and fully promote the implementation of the master plan together with cooperation zone schemes for Hengqin and Qianhai, and effectively align our thoughts and actions with the decisions and deployment of the general secretary and the CPC Central Committee, setting off a massive wave of studying, publicizing and implementing the master plan across the whole province.
Second, we will try to promote the implementation of key tasks. We will establish and improve the mechanisms for organizing, leading, coordinating, and pushing forward our work. The chief officials of the provincial Party committee and the provincial government will take the lead and be in charge of the overall work, the other relevant officials will be responsible for the specific work, and joint working groups at the city- and province-level will be set up. Focusing on the major tasks in five aspects proposed in the master plan, we will specify the key points of the reform, policy, and work, make a list and set up account books, conduct research and analysis, and launch specific platforms, projects, policies, and measures, to accelerate the implementation of the master plan with the joint efforts of the province and its cities.
Third, we will improve the policy planning and supporting system. We will accelerate the introduction of the acting scheme for the implementation of the master plan, formulate provincial-level policies and measures to support Nansha's development, be quick to put forward specific rules for implementing key policies, kick off a new round of the compilation of development plans for Nansha, and strengthen support for Nansha by delegating more power to the district.
Fourth, we will strengthen communication and coordination with Hong Kong and Macao in all respects. We will focus on the goal of turning Nansha into an important carrier to provide strong support for better integrating Hong Kong and Macao into the country's overall development. Nansha will be supported to deepen the connection of rules and mechanisms with Hong Kong and Macao in key areas such as scientific and technological innovation, industrial development, people's livelihood integration, cultural exchange, and urban development, among others. Professionals and talent with a global vision from Hong Kong and Macao will be actively invited to participate in the construction and management of Nansha district.
Thank you.
_ueditor_page_break_tag_Xing Huina:
Thank you. Now the floor is open for questions. Please identify the media outlet you represent before raising questions.
CCTV:
The Nansha plan clearly states that accelerated efforts will be made to build a scientific and technological innovation industry cooperation base, a youth entrepreneurship and employment cooperation platform, a high-level opening-up portal, a high ground for convergence of rules and mechanisms, and a model of high-quality urban development in Nansha. Please tell us what are the considerations for determining these five tasks? What specific measures are there? Thank you.
Guo Lanfeng:
Thank you for your questions. The Nansha plan clearly intends to deepen the comprehensive cooperation between Guangdong, Hong Kong and Macao in Nansha. When we say "comprehensive cooperation," it not only means that we cover Hong Kong and Macao, but also that this kind of cooperation is not limited to some specific aspects, but will cover all key areas of economic and social development. To this end, the plan focuses on such key tasks as scientific and technological innovation, innovative employment, opening up to the outside world, rule convergence, and urban development, and therefore deploys the five tasks. The main considerations and specific measures are:
First, constructing a scientific and technological innovation industry cooperation base. Guangdong, Hong Kong, and Macao are rich in scientific and technological innovation resources. The Nansha plan has put forward many powerful measures to strengthen cooperation in scientific and technological innovation among Guangdong, Hong Kong, and Macao. Among the measures, corporate income tax will be levied at a reduced rate of 15% for enterprises in industries that are being encouraged in the pioneering zones; Hong Kong and Macao residents working in Nansha will be exempted from the portion of their personal income tax that exceeds the tax burden of Hong Kong and Macao. All these measures are expected to greatly boost the gathering of high-tech enterprises and talents in Nansha.
Second, creating a youth entrepreneurship and employment cooperation platform. The Nansha plan clearly includes eligible Hong Kong and Macao residents into the scope of local entrepreneurship subsidies, strengthens the guarantee of supporting services for employment, and provides convenient conditions for accommodation, commuting, and children's enrollment in kindergartens and schools so as to promote the establishment of a hot spot for Hong Kong and Macao youths to innovate and start businesses here.
Third, jointly building a high-level opening-up portal. Nansha is one of the important intersections of the domestic and international circulations and has the unique advantage of connecting the two markets and utilizing the resources of the two. The Nansha plan proposes that Nansha will play an important role in strengthening international economic cooperation and other aspects. According to it, Nansha will study how to further reduce the access threshold for Hong Kong's professional service industry to provide services in the mainland, and rely on Guangzhou, especially Nansha's industrial and market foundation, to join hands with Hong Kong and Macao to continuously deepen international economic and trade cooperation and promote the construction of a new high ground for opening up to the outside world.
Fourth, creating a high ground for convergence of rules and mechanisms. Convergence of rules and mechanisms is one of the key points and difficulties in developing the Guangdong-Hong Kong-Macao GBA. When the rules are connected and converged, the flow of factors will be smooth. The Nansha plan requires Nansha to actively explore and promote the "soft connection" of the rules and mechanisms in the aspects such as improving the level of connection with Hong Kong's and Macao's financial markets, public services, and social management. The plan clearly supports Nansha's pilot projects in cross-border motor vehicle insurance, cross-border commercial medical insurance, etc., and promotes the convergence of the rules of the GBA in depth.
Fifth, establishing a model of high-quality urban development. Accelerating the development and construction of Nansha is an important measure for old city Guangzhou to gain new vitality and make new and outstanding achievements in comprehensive urban functions, comprehensive urban cultural strength, modern service industry, and modern international business environment. The Nansha plan explicitly states that Nansha should deepen cooperation with Hong Kong and Macao in the fields of urban planning and construction, smart city management, and eco-environmental protection so as to promote the modernization of the urban governance system and governance capacity and create a high-quality living circle that is suitable for living, working and traveling.
The five tasks set in the Nansha plan points out the main direction for the construction of a major cooperation platform for Guangdong, Hong Kong, and Macao in Nansha. Next, in accordance with the decisions and deployments of the CPC Central Committee and the State Council, we will work with relevant departments and the governments of Guangdong province and Guangzhou city to continuously deepen our understanding and promote the implementation of these tasks with substantial results. Thank you!
_ueditor_page_break_tag_Southern Metropolis Daily:
The Nansha plan put forward supportive policies in taxation and funding, among others. What are the main considerations here? Thank you.
Wang Jianfan:
The building of the Guangdong-Hong Kong-Macao GBA is a major strategy made by the CPC Central Committee, and Nansha is one of the major cooperation platforms for that. To promote the development of Nansha in deepening the comprehensive cooperation between Guangdong, Hong Kong and Macao, the State Council released the Nansha plan — an overall plan for the development of Nansha — and made related fiscal and tax policy arrangements. Our considerations are in the following aspects:
First, to attract factors of innovation to gather in Nansha and boost the building of a sci-tech innovation hub in the area. Preferential tax policies will be in place. We will extend the loss carryforward period for high-tech enterprises in key industries. The enterprise income tax rate will be reduced to 15% for enterprises in encouraged industries in Nansha's pioneering zones. We will support eligible one-stop business start-up platforms to enjoy tax-preferential policies for incubators of sci-tech companies in accordance with the rules. We will work to implement the import tariff policies that support sci-tech innovations and encourage Nansha to further gather innovation resources and boost the vitality for innovation.
Second, to better take advantage of Nansha's location and create favorable conditions for residents from Hong Kong and Macao to work and live in Nansha. For residents from Hong Kong and Macao who work in Nansha, we will exempt the portion of income tax exceeding that in Hong Kong or Macao, helping our compatriots from Hong Kong and Macao to enjoy more convenience in starting businesses, getting jobs, and living in Nansha. Efforts will be made to support Hong Kong and Macao in integrating their own development into overall national development.
Third, given the expenditures arising from Nansha's rapid development, we will guarantee financial support for the high-quality building of the district. To support the accelerated development of Nansha, from 2022 to 2024, the Ministry of Finance will set the ceiling for newly-incurred local government debt at 10 billion yuan on an annual basis, which will be dedicated to five major building tasks of Nansha. Support will be given to major projects that are expected to enjoy better benefits and growth prospects and will take a demonstrative and leading role. At the same time, based on the fiscal strength of local governments, debt risks, and the financing needs of projects, Guangdong province will weigh its supporting policies toward Nansha while allocating relevant fiscal budgets and new quotas of local government bonds. The funds will be devoted to developing infrastructure and public service facilities in Nansha.
Next, the Ministry of Finance, together with other departments, will work out detailed policies clearly outlined in the Nansha plan, ensure them to be well implemented, and give play to the role of policies in helping build Nansha into a major global-oriented strategic platform in the GBA that brings together Hong Kong and Macao. Thank you.
_ueditor_page_break_tag_GRT:
According to the Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area, Nansha district will fully leverage its strength as the state-level new area and the pilot free trade zone (FTZ), enhance comprehensive cooperation with Hong Kong and Macao, and accelerate its development to carry the functions of international shipping and scientific and technological innovation for the GBA and become a gateway of high-standard opening-up. Since Nansha plan has made clear requirements in terms of the strategies of "going global", how will Nansha district cooperate with Hong Kong and Macao to further advance its institutional opening-up? Thank you.
Zhang Hu:
Thanks for your questions. The master plan takes global perspective as one of the important strategic positioning of Nansha district's development, requiring Nansha district to play a leading role in the Guangdong-Hong Kong-Macao GBA's participation in international cooperation and competition, and work together with Hong Kong and Macao to build a gateway to high-standard opening-up. Going forward, we should have an accurate understanding of the opening-up orientation for Nansha district, focus on international and domestic markets and resources, giving full play to the role of the GBA as the pacesetter for institutional innovation, the gateway of opening-up, and the hub of comprehensive services. We should work with Hong Kong and Macao to build an institutional system and regulatory model that are consistent with the international rules to achieve high-quality "bringing in" and high-standard "going global" and continuously improve global resource allocation capabilities, making positive contributions to accelerating the construction of a new pattern of development. The priority of our work will be given to the following four aspects:
First, we will improve comprehensive services for the strategies of "going global." We will align with the development needs of countries and regions along the Belt and Road routes and fully leverage both the strengths of Hong Kong and Macao, such as intensive international connections and developed professional services. This will also include the strengths of the GBA, such as vast mainland market, complete industrial system, and strong scientific and technological strength to fully support the development of modern service industry clusters in Nansha district. We will jointly advance the international economic and trade cooperation, develop an integrated online and offline system of one-stop comprehensive services for international investment and financing, and build a comprehensive service base for Chinese companies to "go global."
Second, we will further develop it into an international shipping and logistics hub. We will work with Hong Kong and Macao to enhance the role of the GBA as the international shipping hub, deepen cooperation in key areas such as shipping logistics, shipping finance, maritime services, and cruises and yachts. We will also promote the cross-border and cross-region integration of maritime service resources, and accelerate the construction of major projects such as Phase IV of the Guangzhou Nansha Automated Deepwater Port. We will support Guangzhou Shipping Exchange to expand shipping exchange and other services and work with Hong Kong and Macao to build a Joint Shipping Exchange Center in the GBA. We will accelerate the development of maritime services such as ship management, inspection and testing, and maritime dispute resolution and create an international maritime service industry cluster district.
Third, we will strengthen its role as an engine for international economic cooperation. We will support Nansha district in pursuing the high-quality implementation of the Regional Comprehensive Economic Partnership (RCEP) agreement and actively align with the rules in high-standard international free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Digital Economy Partnership Agreement (DEPA). We will conduct more stress tests to accumulate experiences in advance. We will actively foster stronger synergy and cooperation with developed economies in the fields of the digital economy, technology finance, and green development. We will support enterprises to participate in the making of international rules and standards, contributing to China's participation in the reform of the global economic governance system.
Fourth, we will further build it into a new platform for international exchanges. We will jointly advance practical exchanges and cooperation with the Belt and Road Initiative countries and regions, global major FTZs, international ports, business associations, and international organizations. We will hold international-themed events such as the annual meeting of the International Financial Forum (IFF) and the Greater-bay Science Forum and create an international economic cooperation platform for the GBA to synergize with the Belt and Road Initiative. We will encourage and guide major business associations of Hong Kong and Macao to set up representative offices in Nansha district and actively introduce Hong Kong and Macao professionals and talents with global vision to participate in the construction and management of Nansha district to accelerate the modernization and internationalization of Nansha district's development.
Thank you.
_ueditor_page_break_tag_21st Century Business Herald:
The Nansha plan is another major strategic deployment of the Chinese government to further promote the development of the Guangdong-Hong Kong-Macao GBA. How has Nansha's development been up to now, and what kind of foundation has it laid for the Nansha plan in the future? How will you build Nansha into a strategic platform in the GBA that coordinates with Hong Kong and Macao and connects with the world? Thank you.
Guo Yonghang:
Thanks for your questions. Since the 18th CPC National Congress, General Secretary Xi Jinping and the Party Central Committee have paid close attention to Nansha's development. In 2014, Nansha district became a pilot FTZ. During his inspection tour in Guangdong in 2018, General Secretary Xi Jinping stressed the need to plan, develop, and construct Nansha district well. In 2019, the Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area proposed building Nansha district into a demonstration zone of comprehensive cooperation between Guangdong, Hong Kong, and Macao. Thanks to these multiple benefits, Nansha ushered in a new stage, and its development accelerated significantly. Last year, the Nansha district's GDP exceeded 200 billion yuan, and the world's top 500 companies invested in 223 projects there. Its R&D investment intensity reached 3.67%, and a "1+1+3+N" system for S&T innovation was initially formed. A total of 749 institutional innovation results were achieved, 43 of which have been promoted nationwide. More than 2,700 Hong Kong and Macao enterprises have settled in the district with an investment volume of US$117 billion. The Guangzhou Futures Exchange, the Greater Bay Science Forum, and International Financial Forum were also set up and held in Nansha.
Located at GBA's geographical heart, Nansha district is in the center of the bay area, covering an area of 803 square kilometers and with a development intensity of 23%. Renowned universities, institutions, and research centers are therefore attracted to Nansha: The Hong Kong University of Science and Technology (Guangzhou) will open in autumn of this year, the middle school affiliated with the South China Normal University and Zhixin High School will open campuses in Nansha, and two national medical centers of Guangdong will also settle in Nansha. With outstanding advantages and beneficial policies, Nansha's future development enjoys favorable timing, geographical convenience, and the people's support.
The plan, which makes Nansha a major strategic platform,puts forward five objectives and requirements. We will strengthen the Party's leadership in all respects, bear in mind the country's most fundamental interests, and seize the opportunity and grasp this historic opportunity so as to follow the principles of innovation, practicality, and precision and live up to the mission of our times.
In terms of innovation, we will carry forward Guangzhou's spirit of reform and innovation, stay enterprising and innovative, and set new standards in order to accelerate alignment with the rules and mechanisms of Hong Kong and Macao. A world-class business environment that can attract both domestic and international enterprises will be established. We will work together with Hong Kong and Macao to build Nansha into a comprehensive service base for Chinese enterprises going abroad, a new model for global resources allocation, and a new platform for international exchange. Nansha strives to become a strategic node in fostering a new development paradigm.
In terms of practicality, we will take a pragmatic approach, make concrete efforts and aim to deliver when cooperating with Hong Kong and Macao. The Guangzhou laboratory is encouraged to strengthen research cooperation with Hong Kong and Macao, and other laboratories in Guangdong province are urged to set up branches or bases in Hong Kong. We will facilitate cross-border use of fiscal research funds and boost research institutions to jointly carry out S&T innovation projects. Tapping into Hong Kong's "super-connector" role and Macao as a bridge connecting with Portuguese-speaking countries, Nansha will drive the commercialization and application of international S&T achievements. Efforts will be made to introduce investment, deepen cooperation in industrial and supply chains, construct a demonstration zone for young Hong Kong and Macao entrepreneurs, improve relevant policy and service systems, and strengthen the supply of education, medical care, elderly care, and other services for Hong Kong and Macao residents.
In terms of precision, we will pursue elaborate planning, targeted construction, and sound growth so as to promote high-quality development. The development plan of Nansha district will be revised, and regulations of Nansha on deepening comprehensive cooperation between Guangdong, Hong Kong, and Macao with a global perspective will be formulated. Protection and inheritance of history and culture will be strengthened, and a national demonstration zone for ecological friendliness will be created. We will build the smartest urban district and fine-tune our efforts in urban management. Smart manufacturing, digital industries, high-end service industries, and industries related to reinforcing the marine industry through technology will be developed. We will also build a modern industrial system featuring green and low-carbon technologies. Thank you.
_ueditor_page_break_tag_Hong Kong Commercial Daily:
Financial support for the real economy is a highlight of Nansha's development and a focus of the Nansha plan. What measures has the PBC taken to promote Nansha's development through financial support? What are your plans for the future? Thank you.
Wang Xin:
Thank you for the questions. The PBC attaches great importance to developing the GBA and Nansha, a critical platform for cooperation between Guangdong, Hong Kong, and Macao. Under the leadership of the CPC Central Committee and the State Council, we have strengthened financial support to boost Nansha's high-quality development, aid with Nansha's role in deepening comprehensive cooperation between Guangdong, Hong Kong, and Macao, and build a major strategic GBA-based platform with a global outlook. In terms of top-level design, we have introduced 15 financial reform measures for Nansha, the Guidelines on Financial Support for the Development of China (Guangdong) Pilot Free Trade Zone, the Opinions on Financial Support for the Development of the Guangdong-Hong Kong-Macao Greater Bay Area, and other targeted documents. Regarding the connectivity of financial markets, we officially launched the Cross-boundary Wealth Management Connect Scheme in the GBA last October, expanding cross-boundary wealth management channels for residents in the GBA, including those in Nansha. To facilitate cross-border investment and financing, the State Administration of Foreign Exchange launched a pilot program for high-standard opening-up of cross-border trade and investment in Nansha last November and introduced 13 specific measures. Free trade accounts and cross-border capital pool business have also been launched in Nansha. In terms of financial leasing, we have vigorously boosted the concentration and innovative development of the sector, and several new transactions, such as cross-border aircraft subleases, have been launched in Nansha. In terms of green finance, the Guangzhou Futures Exchange was unveiled in Nansha, developing products that can serve low-carbon and green development, such as carbon emission rights, electricity, and new energy metals. In terms of risk prevention, we have supported Nansha in building a local financial risk monitoring and prevention platform for Guangdong province and continuously enhanced risk monitoring and prevention abilities. Overall, finance has become a pillar industry in Nansha. Just seven or eight years ago, Nansha started to develop its financial sector from scratch. In 2015, the value-added of the financial sector was almost negligible. In 2021, the value reached 17.15 billion yuan and accounted for 8.05% of Nansha's GDP. A total of 6,650 financial enterprises have settled in Nansha, an increase of 54 times within seven years. The tax contributions paid by the financial sector increased at an average annual growth rate of nearly 60% from 2016 to 2021.
Going forward, the PBC will continue to implement the decisions and plans of the CPC Central Committee and the State Council, support the development of Nansha's modern financial sector in collaboration with relevant departments, and promote the implementation of various innovative measures such as high-standard opening-up of cross-border trade and investment, push forward financial market connectivity in an orderly manner, improve risk prevention and control abilities while pursuing opening-up, and provide strong financial support for Nansha to build a critical platform for cooperation between Guangdong, Hong Kong, and Macao, and to better play a leading role in the development of the GBA.
Thank you.
_ueditor_page_break_tag_Phoenix TV:
Currently, Nansha also attaches great importance to scientific and technological innovation. Voices from Hong Kong ask if this will be a challenge to Hong Kong and other places? How to better leverage their complementary advantages for cooperative development? Thank you.
Guo Yonghang:
Thank you for your question. General Secretary Xi Jinping has stressed that the core position of innovation in the overall modernization drive must be upheld and innovation must be actively encouraged and supported as a national policy. Any innovator, regardless of where they come from, will be supported by us as long as they contribute to national development. The plan's release marks that the development and construction of Nansha has gained national significance, thus giving Nansha great responsibility. Nansha should not and will not be absent in China's efforts to enhance its independent scientific and technological capabilities and foster a new development paradigm.
In recent years, under the strategic guidance of the Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area, the development of both Guangzhou and the Nansha district has become more integrated with that of Hong Kong and Macao, showing sound momentum of integration and mutual promotion. For example, in terms of sci-tech infrastructure, a team of professors from the Hong Kong University of Science and Technology (HKUST) studied cycling aerodynamics with the "Tianhe-2" supercomputer installed in the Nansha branch of the National Supercomputer Center in Guangzhou, thus helping Hong Kong athlete Lee Wai-sze win a precious medal in track cycling at the Tokyo Olympic Games. Data showed that over the past five years, more than 200 HKUST teachers used the National Supercomputer Center in Guangzhou, which is as convenient as using a local area network. For another example, in terms of implementing major sci-tech special projects, the Southern Marine Science and Engineering Guangdong Laboratory (Guangzhou), which is located in Nansha, has set up a branch in Hong Kong, and the laboratory allocated 38 million yuan in cross-border scientific research funds to the branch in 2019, the first of its kind by a mainland city. Over the past two years, Guangzhou, Hong Kong, and Macao have also made vigorous research cooperation against the pandemic.
The plan emphasizes coordination with Hong Kong and Macao, thus pointing out the path for Nansha's development. It also emphasizes a global perspective, which is a shared goal for the development of Guangdong, Hong Kong, and Macao. In fact, the needs and aspirations of Nansha are just the strengths of Hong Kong and Macao. For example, in terms of facilitating the transfer and application of international advances in science and technology, the strength of Hong Kong as a "super contact person" and the strength of Macao as a bridge connecting to Portuguese-speaking countries are incomparable. At the same time, Nansha has an outstanding advantage in industrialization. Therefore, cooperation is far greater than competition for Nansha, Hong Kong, and Macao.
A Chinese saying says, " When brothers are of the same mind, they have the power to cut through metal." We will follow the top-level design from the central government and commit to complementarity of advantages and coordination to strengthen joint innovation among Guangdong, Hong Kong, and Macao. Efforts will be made to accelerate the progress of a number of major projects, including the big science facilities for cold-seep ecosystem observation and simulation, the Southern Marine Science and Engineering Guangdong Laboratory (Guangzhou), the Mingzhu Science Park of the Chinese Academy of Sciences, and the Headquarters Base for the Transfer and Application of HKUST's Scientific and Technological Innovation Achievements. We will actively support Nansha as a destination of transfer and application of Hong Kong's innovation achievements in electronic engineering, computer science, marine science, artificial intelligence, smart city, and other fields. We will strive to make the pie of cooperation bigger and better so we can all enjoy more pie. Thanks!
_ueditor_page_break_tag_Macao Daily:
The central government has rolled out a series of supporting policies and measures in recent years to bolster the development of the GBA, such as the plans for Hengqin and Qianhai. And now comes the Nansha plan. How are they different from one another regarding functions and positions? What's unique about the Nansha plan? Thank you.
Guo Lanfeng:
Thank you for your question. The three platforms- Hengqin in Zhuhai, Qianhai in Shenzhen, and Nansha in Guangzhou, are major cooperation platforms announced in the Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area. Last September, the CPC Central Committee and the State Council issued the General Plan for Building the Guangdong-Macao In-depth Cooperation Zone in Hengqin and the Plan for Comprehensively Deepening Reform and Opening-up for the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone. This June, the State Council introduced the Master Plan of Guangzhou Nansha on Deepening Comprehensive Cooperation between Guangdong, Hong Kong, and Macao with a Global Perspective. The Hengqin plan focuses on the original aspiration of promoting Macao's moderate economic diversification and aims to serve Macao's development and advance its integration with Hengqin. The plan defines the strategic position of the zone as a new platform to boost Macao's moderate economic diversification, a new space that provides convenience to Macao residents' life and employment, and a new model to enrich the practice of "one country, two systems," as well as a new high ground for building the GBA. The Qianhai plan is mainly about expanding the existing zone and further opening up. Centering on promoting the modern service industry - one of Hong Kong's competitive industries, it aims to deepen cooperation between Shenzhen and Hong Kong and jointly build a test platform for comprehensively deepening reform and innovation as well as a high-level gateway for opening up. It is set to provide more space for Hong Kong's economic development and accumulate experience for the reform and opening-up of Shenzhen and the mainland beyond. The plans for Hengqin and Qianhai emphasize serving Macao and supporting Hong Kong, respectively, to further advance the Guangdong-Hong Kong-Macao cooperation.
Highlighting two key components -- "comprehensive cooperation in the GBA" and "a global perspective," the Nansha plan stresses synergetic development between Nansha and Hong Kong and Macao for a wider opening-up of the GBA. The project is attributed to the domestic and global landscape and the foundations of Nansha's development. The two components were our focus during the Nansha plan's compilation.
On the one hand, we consistently pursue synergetic development between Nansha, Hong Kong, and Macao. We firmly bear in mind the critical mission of supporting Hong Kong and Macao's integration into overall national development, improving Hong Kong and Macao compatriots' well-being, and maintaining longstanding prosperity and stability in the two special administrative regions. In the strategic context of developing the GBA, we are giving full play to Nansha's advantages. We are using exchange mechanisms like the Guangdong-Hong Kong Cooperation Advisory Committee and major cooperation platforms like the Hong Kong University of Science and Technology. We coordinate the "hard connectivity" of infrastructure with the "soft connectivity" of rules and mechanisms. We attach more importance to industrial cooperation on science and technology innovation as well as youth's employment and business start-up and accelerate factors' efficient and convenient flow in the GBA to promote extensive consultation, joint contribution, and shared benefits in the region.
On the other hand, we consistently open up to the world. To build a new development paradigm, we explore resources in both domestic and global markets and synergize with Hong Kong and Macao in establishing an institutional system and regulation mode conforming to international rules and norms. Leveraging the rules of international high-level free trade agreements, we actively integrate into the global market to realize high-quality "bringing in" and "going global" and increase the GBA's edge in terms of international cooperation and competition.
Despite their unique strategic positions, the three cooperation platforms of Hengqin, Qianhai, and Nansha mutually reinforce each other, with a view to piloting critical links in key areas and accumulating experience. They are expected to power extensive cooperation in the GBA, expand development space for Hong Kong and Macao, support their socio-economic development, and sustain their longstanding prosperity and stability. Thank you.
_ueditor_page_break_tag_CRNTT:
The Nansha plan proposed to build Nansha into a new home for Hong Kong and Macao youths by creating a cooperation platform for youth entrepreneurship and employment. In particular, it aims to raise the number of residents from Hong Kong and Macao in Nansha significantly by 2035. Could you share with us what measures Guangdong has made in this regard? What key policies and measures will Guangdong take next in attracting Hong Kong and Macao youths? Thank you.
Zhang Hu:
Thank you for your questions. General Secretary Xi Jinping stressed that efforts must be made to create more opportunities for young people in Hong Kong and Macao and help them solve practical difficulties and problems in their study, employment and starting up of businesses and create a social environment favorable for them to realize their dreams. In recent years, Guangdong has actively supported and facilitated innovation, entrepreneurship, and employment among Hong Kong and Macao youths in the province. We have initially established a "1+12+N" system of innovation and entrepreneurship incubators for Hong Kong and Macao youths, under which "1" refers to the Guangdong-Hong Kong-Macao Greater Bay Area (Guangdong) Innovation and Entrepreneurship Incubator, "12" refers to the twelve key incubators in the Pearl River Delta, and "N" refers to the various distinctive incubators spread across Guangdong. With this system, we have incubated 2,394 projects for Hong Kong and Macao youths and attracted 3,455 Hong Kong and Macao youths to work in Guangdong. We have also organized job fairs for college students of the Guangdong-Hong Kong-Macao GBA and offered nearly 100,000 job and internship vacancies to Hong Kong and Macao youths. The master plan has listed cooperation in youth entrepreneurship and employment as one of its five priorities, with unprecedented expectations, support, favorable policies, and rare opportunities.
Next, Guangdong will actively seize the major opportunities presented by the master plan and let more Hong Kong and Macao youths share the development opportunities of the GBA, better integrate into national development and actively participate in national construction with good resources, conditions, and platforms. The following three areas will be our key priorities.
First, we must create opportunities and coordinate youth innovation and entrepreneurship efforts. We will improve the construction of key innovation and entrepreneurship projects such as the GD, HK & Macao (International) Youth Entrepreneur Hub and the Cultural Innovation Community for Guangdong, Hong Kong, and Macao Youths. We will introduce innovative management modes for these projects and expand their services to foster a quality ecosystem for innovation and entrepreneurship. We will push ahead with efforts for qualified one-stop innovation and entrepreneurship platforms to enjoy the preferential tax policies offered to tech enterprise incubators in accordance with rules. We will also include qualified business starters from Hong Kong and Macao under the coverage of entrepreneurship subsidies of Nansha and let them equally enjoy such support policies as guaranteed loans and interest subsidies.
Second, we must improve the environment and provide a better guarantee for jobs and internships. We will accelerate efforts to build a public platform for comprehensive employment services. Nansha's program for Hong Kong and Macao youths to work in local enterprises will be further implemented to align with the Greater Bay Area Youth Employment Scheme and the Thematic Youth Internship Programs on the Mainland of the government of the Hong Kong Special Administrative Region. We will also explore ways for public institutes, statutory institutes, and state-owned enterprises in Nansha to recruit youth talents from Hong Kong and Macao. Besides, we will make it more convenient for Hong Kong and Macao professionals to work and practice in Nansha with improved policies and services for them in various aspects from entry and exit, housing, transport, and education to healthcare and social security and medical insurance. We will work wholeheartedly to see that Hong Kong and Macao youths can work in Nansha worry-free.
Third, we must build bridges to strengthen cultural exchanges among youths. We will work to do a good job in building the headquarters for exchanges among youths of Guangdong, Hong Kong, and Macao, actively carry out cooperation on study tourism of teenagers, and build up several distinctive brands of exchange programs. We will tap Guangzhou's advantages as the place of origin of the Maritime Silk Road, the center for Lingnan culture, and its forward position for reform and opening up. We will work with Hong Kong and Macao to hold various forms of cultural and art activities to guide teenagers of Guangdong, Hong Kong, and Macao to actively participate in the protection and utilization of major cultural heritages and constantly boost their sense of belonging to the motherland and sense of identity to the "one country, two systems" principle. Thank you.
Xing Huina:
Thank you to all speakers and friends from the media. Today's press conference is now concluded.
Translated and edited by Cui Can, Wang Wei, Xu Kailin, Ma Yujia, Lin Liyao, Liu Qiang, Zhang Liying, Zhang Junmian, He Shan, Zhou Jing, Wang Qian, Zhu Bochen, Yuan Fang, Zhang Tingting, Yang Xi, David Ball, Tom Arnsten, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Li Bin, vice minister of the National Health Commission (NHC)
Lei Zhenglong, deputy head of the disease control and prevention division of the NHC
Liang Wannian, head of the Expert Group of the Epidemic Response and Disposal Leading Group of the NHC
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
April 29, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Informational Office (SCIO). Today's press conference is about upholding the dynamic zero-COVID policy to prevent and control the pandemic. Today, we are joined by Mr. Li Bin, vice minister of the National Health Commission (NHC); Mr. Lei Zhenglong, deputy head of the disease control and prevention division of the NHC; and Mr. Liang Wannian, head of the Expert Group of the Epidemic Response and Disposal Leading Group of the NHC. They will brief you on relevant information and then take your questions.
Now, I'll give the floor to Mr. Li Bin.
_ueditor_page_break_tag_Li Bin:
Friends from the media, good morning. Since the outbreak of the COVID-19 pandemic, the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core has always put protecting the people and human life above everything else. By bearing in mind the big picture, taking science-based actions, and following objective laws, the CPC Central Committee has consistently adhered to the overall strategy of "preventing inbound cases and domestic resurgence" and carrying out the general policy of dynamic zero-COVID. Our practices on pandemic prevention and control over the past two years and more have proven that the dynamic zero-COVID approach, namely controlling and treating every confirmed case once detected, protected the health and safety of the people to the greatest extent possible and minimized the pandemic's impact on the national economic and social development. This is a correct approach with effective results and the best means to secure victory in China's anti-pandemic fight.
Since the end of February this year, given the spread of highly contagious and stealthy Omicron sub-variant, China has seen frequent flare-ups of COVID-19 cases in multiple places, with a large swathe of areas affected. Pandemic prevention and control efforts have faced the most daunting challenge since the pandemic broke out in Wuhan. In response, we have been unswervingly carrying out the dynamic zero-COVID policy. We have immediately coordinated resources concerning nucleic acid tests, epidemiological investigation, case transfer, quarantine, and treatment and worked to contain the spread of the pandemic to the greatest extent possible. Cluster infections in Jilin province and many other places have been effectively contained, and the dynamic zero-COVID approach has achieved initial success in Shanghai. The number of confirmed COVID-19 cases in China has seen a fluctuating downward trend.
We are facing a pandemic of a scale unseen in a century. The baseline level of COVID-19 cases worldwide is still very high, and new COVID variants continue to develop. We are still trying to understand the coronavirus and the pandemic, and the risks and threats posed by COVID-19 still exist. China is a highly populous country with considerable regional differences and inadequate medical resources. Relaxing prevention and control measures will create surging COVID-19 infections in a short period of time, which can soon lead to a significant number of severe and death cases. This will put an overwhelming strain on our medical resources and pose a severe threat to the life and health of the vulnerable group, such as patients with underlying medical conditions, senior citizens, children, and pregnant women. The stable development of China's economy and society will also be severely affected.
Since the pandemic broke out, China was one of the first countries to successfully contain the spread of COVID-19, resume work and production, and realize positive economic growth among major economies worldwide. A stable epidemic situation has offered China the most favorable environment to secure its world-leading economic growth and pandemic prevention position. Ensuring a coordinated national response and carrying out localized and stringent anti-pandemic measures is the most cost-efficient way. This makes sure that people in most regions in China can enjoy everyday life and work.
From the anti-pandemic fight in Wuhan and the nationwide routine COVID-19 control to the targeted and whole-process prevention and control of Delta and Omicron variants, China has always been upholding the general policy of dynamic zero-COVID approach and controlling and treating every confirmed case once detected. Our practices have proven that the dynamic zero-COVID approach is the best choice currently to coordinate pandemic prevention and control with social and economic development. This approach is a bottom line that China must safeguard for pandemic prevention and control.
The dynamic zero-COVID policy does not indicate absolute "zero infection." Facing the challenges posed by COVID-19 variants such as Omicron, we cannot eliminate domestic resurgence. However, China has summarized a set of effective prevention and control measures from our practices. We optimize these measures according to the emerging coronavirus variants and new pandemic conditions. We will firmly achieve unity in thinking and action to carry out anti-pandemic measures further, consolidate preventive efforts and enhance our implementation capacity. We will also ensure that local authorities, administrative bodies, employers, and individuals have taken their respective responsibilities in pandemic prevention and control. When domestic resurgence happens, we can confidently take swift actions and precise and comprehensive measures to clear all COVID-19 cases in the shortest period of time and realize the most effective containment with the most negligible costs.
That is all the essential information I have for you. Now my colleagues and I are ready to take questions. Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
Thank you, Mr. Li Bin. Now the floor is open. Please identify your media outlet before raising your questions.
CGTN:
Some people think that China is a large country with different situations in different places. Thus the dynamic zero-COVID policy should be flexible and adjusted to reflect local conditions. I wonder what your take on that is? Also, is it possible to co-exist with the coronavirus in some places and adopt the dynamic zero-COVID policy in other areas? Thank you.
Li Bin:
Thank you for your questions. This has drawn the attention of both the press and the general public. COVID-19 prevention and control is an all-out war, and therefore we need to think of the big picture and ensure a coordinated national response. Only when the pandemic is brought under control can we safeguard people's life and health and create favorable conditions for people's everyday life and work. Only when every city in China sticks to a dynamic zero-COVID policy and contains its local outbreak can the entire country win the fight against the pandemic. If certain areas do not resolutely uphold the dynamic zero-COVID policy, while trying to make an exception, the virus could spread and rapidly cause an outbreak. These places could even become an transmitter and amplifier of the outbreak, leading to spillover to other cities and regions, causing heavy loss of people's life and property, and severely affecting social and economic development.
But under the general dynamic zero-COVID policy, we encourage local areas to explore good experiences and measures according to their particular situations in order to be more scientific and precise in COVID prevention and control and achieve maximum results with minimum costs. Thank you.
Beijing Youth Daily:
Some people argue that though Omicron spreads quickly, many of the infected show mild or no symptoms, and thus China could choose to "lie flat" when responding to COVID. I wonder what your take on this is? Thank you.
Li Bin:
This argument has also drawn the attention of many people. I'll ask Mr. Liang Wannian to take it.
Liang Wannian:
Thank you. From a global perspective, countries choose their COVID prevention and control strategies and measures based on their prevention and control principle. China's principle has always been putting people first and putting life first. In other words, it is people-centered and health-centered. Under this principle, we adopted the general dynamic zero-COVID policy and have continuously optimized and improved our measures according to the changes in the pandemic. Through our efforts, we managed to protect our people from the harm brought by so-called herd immunity and natural immunity, protect the health and life of the overwhelming majority of our people, and protect the everyday life, work, and economic development of the largest areas of China.
Some countries have two kinds of immunity. On is natural herd immunity, which, means that people get infected naturally by COVID-19, and then a large percentage of the population gets infected. The other is vaccination-induced immunity. China achieves its immunity through vaccination and build a safety net. Currently, more than 3.3 billion doses of COVID-19 vaccines have been administered on the Chinese mainland, covering 90% of its population. However, disparities remain. In particular, the gaps in vaccination rates in different ages and regions still exist. If we work harder to raise the vaccination rate for vulnerable groups like the elderly and children, we can set up proactive immunity barriers. Compared with uncontrollable passive immunity, we prefer proactive immunity.
As a country with a large population, China faces imbalanced development among regions, shortages of medical resources, and inequality in resource distribution. As I have mentioned earlier, the vaccination rates for the elderly and the children are not high enough generally. In the face of repeated outbreaks, if we choose the so-called policy of coexisting with the virus, medical resources would be very likely to be overwhelmed, thus threatening the health of patients with background diseases, elderly people, children, and the pregnant. Meanwhile, that would deal a heavy blow to economic and social development. Under such circumstances, we must stick to the general principle of dynamic zero-COVID. Indeed, we must improve and optimize prevention and control measures during the time window. If we step up efforts in vaccination and accelerate R&D of medicines and vaccines, I think we can seize the chance. We will defeat the virus if we have a high vaccination coverage, especially for those older people and other vulnerable groups, all localities are well equipped with medical resources, quarantine beds, effective medicines applicable in a large scale, material supplies, and emergency mechanisms, the virus becomes milder without worse or new variations and an acceptable death rate, and we make use of the time saved by the dynamic zero-COVID policy.
Thank you.
_ueditor_page_break_tag_Bloomberg:
What is the biggest lesson you've learned from the mistakes that were made in Shanghai in containing the outbreak? And separately on vaccination, why doesn't China compel elderly people to get vaccinated like you have for students and other population groups? What is an acceptable vaccination rate for those over 80 that China would be comfortable opening up under? Thank you.
Li Bin:
Thank you for your two questions. We invite Mr. Lei to answer the question about the vaccination of the elderly and Mr. Liang to answer the question about what lessons Beijing should draw in epidemic prevention and control.
Lei Zhenglong:
Thank you for your question. In accordance with the arrangements of State Council's inter-agency task force, the NHC has continued to guide local governments to push forward with vaccination in a proactive and well-considered way. As of April 28, 3.340711 billion COVID-19 vaccine doses had been administered across the Chinese mainland. A total of 1.284935 billion people had been vaccinated, and 1.249688 billion had been fully vaccinated, accounting for 91.14% and 88.64% of the total population, respectively. A total of 750.189 million people had got a booster shot, among whom 29.967 million had got sequential booster jabs. About 227.088 million people aged 60 and above had been vaccinated, and 215.155 million had been fully vaccinated, registering 86.01% and 81.49% of the age group, respectively. A total of 160.425 million people in the group had got a booster shot.
So far, the overall work of vaccination has been going smoothly. We are taking orderly steps to administer booster shots, and the vaccination coverage rate of senior citizens has been gradually increasing. Recently, the NHC has made further arrangements to mobilize senior citizens to get vaccination shots.
First, we will see that local governments fulfill their responsibilities. Local governments must fully recognize the significance and urgency of the need for the elderly to get vaccinated. The actual situation of the senior population within their jurisdictions should be checked proactively so that further arrangements for their vaccination can be implemented and their safety can be ensured.
Second, we will give full play to the role of departments responsible for the welfare of the elderly people. To further increase the vaccination coverage rate of the elderly group, the office of the China National Committee on Aging has specifically issued a notice in advance on better promoting the vaccination among the elderly group. The notice has guided local governments to give full play to the role of social organizations related to the work for the elderly group and encouraged all localities to work together to ensure the safe and convenient conditions of the vaccination for the elderly.
Third, we will intensify our efforts on publicity and mobilization. In combination with the China Prophylactic Vaccination Day activities on April 25 this year, we guided all localities to adjust measures in accordance with their specific local conditions to carry out further publicity on COVID-19 vaccination to encourage more people to get vaccinated. In addition, various other platforms, including radio, television, newspapers, open letters from the government and communities, and new media and We-media, were also used to promote vaccination in the communities, rural areas, and nursing homes.
Getting vaccinated and personal protection measures are effective means for COVID-19 prevention and control. Therefore, I also hope that our media friends will support and carry out more publicity activities about the popularization of vaccination. We will further increase the vaccination coverage rate of key groups and senior citizens with our joint efforts. In this way, we will offer more support to the epidemic prevention and control efforts. Thank you.
Liang Wannian:
Let me answer the second question. The epidemic strain of the outbreaks in Beijing and Shanghai is the Omicron variant. Both cities are super-large, each with a population of 20 million or more. The Omicron variant has the characteristics of rapid spread and strong concealment. For these megacities, this has increased a lot of difficulties in fighting COVID-19 outbreaks. And this has put forward higher demands in terms of organization and implementation and other aspects such as related nucleic acid testing capabilities and medical treatment capabilities. Therefore, it is a test of these megacities' governance systems and governance capacity to a certain extent.
Speaking from the perspective of the epidemic situation experienced in Shanghai and that Beijing is also fighting the sporadic COVID-19 epidemic, I think there are a few points that can be enlightening. First, Omicron spreads too fast and is too concealed, so we must improve the previous approaches to fight the original strain of the novel coronavirus and its Alpha, Beta, and Delta variants. The general rule is to move fast. The virus spreads quickly, so the speed of our moves, and the intensity and speed of our work, have to be faster and race against time to fight this virus. This is a significant change.
Second, we still have to build our confidence. Some cities in China, such as Shenzhen in Guangdong province, Changchun in Jilin province, Tianjin, etc., have all experienced the outbreak of the Omicron. The practice has proved that we can effectively control the spread of the epidemic by adopting effective strategies and tactics to achieve dynamic zero-COVID, so we must firmly establish this confidence. We have the ability, the foundation, and the conditions to defeat the epidemic and spread caused by the Omicron. As you can see, significant progress has been made in both Shanghai and Beijing.
Third, we must consider that the most vulnerable groups of this variant are the elderly and those with underlying diseases. The most effective means of protection is vaccination. The population of these two cities is also relatively old, and the proportion of the elderly population is higher than the national average. Therefore, strengthening the vaccination of the elderly and effectively increasing the rate of whole process vaccination and the vaccination rate for the booster shot is an effective means to protect their health, which must be strengthened. At the same time, it should be emphasized that in response to the outbreak of the Omicron, we must go all out to implement the policy of ensuring that all those in need are tested, isolated, hospitalized, or treated. We have formed this experience since the fight against the Wuhan epidemic in 2020. As long as the policy is fulfilled, the transmission chain of the epidemic can be quickly and effectively cut off, the people's health can be effectively protected, and medical treatment can be effectively executed.
Last but not least, the battle against the COVID-19 pandemic is an all-out people's war. It is also a systemic process that needs strong synergies among governments, departments, every individual, and the whole society. The efforts to fight the pandemic in Shanghai and Beijing need to mobilize the entire society under the guidance of a systemic philosophy to ensure that local authorities, relevant departments, employers, and individuals fulfill their responsibilities. I think we will win the anti-pandemic war, as we are waging a people's war against it in a swifter response and a more scientific and efficient manner. Thank you.
_ueditor_page_break_tag_Hong Kong Ta Kung Wen Wei Media Group:
The current pandemic prevention and control measures have caused some inconvenience in production and people's life. Some believe that the "dynamic zero-COVID" approach has slowed China's economic growth. What do you think will be the impact on the economy of this approach? Thank you.
Liang Wannian:
Thank you for your question. First, we need to clarify that the ultimate purpose of the dynamic zero-COVID approach is to make the utmost efforts to ensure people's health and protect their lives while sustaining social and economic development and ensuring normal production and daily life. The approach can be coordinated with economic development, and normal production and life. They are not contradictory. We have been implementing the general principle of the dynamic zero-COVID policy with a series of measures, but that doesn't necessarily mean it will affect economic growth or normal production and life. The reason lies in that the pandemic containment and economic development can be coordinated. They are both the primary objectives of the dynamic zero-COVID approach. There are also three subgoals that the policy aims to achieve: First, it aims to safeguard people's health and lives. Second, it aims to ensure economic development to protect the economy from the impact of the virus. Third, it aims to ensure people's normal work and life. As such, they are not contradictory.
We need to understand that it is the pandemic and the virus dragging down the economy. The pandemic impacts the economy of all countries in the world, which have been doing their best to minimize the impacts of the virus and pandemic with various policies and measures adopted in line with their own guiding principles. However, the differences in anti-epidemic philosophies, guiding principles, policies and measures, coupled with factors such as the response speed and implementation effectiveness, lead to different outcomes and efficiency of the pandemic containment efforts. It should be admitted that some of the measures adopted to fight the virus will cause temporary inconvenience in daily life and affect social and economic activities temporarily. But the targeted way is the priority in the general principle of the dynamic zero-COVID approach, which aims to synergize pandemic containment, economic development, and normal production and life in a targeted and balanced manner. In this regard, different areas need to consider their respective pandemic situation and local social and economic situation to make the approach work well and thereby effectively balance the relationship between pandemic containment and economic development, as well as people's normal work and life.
The last thing I want to say is how to understand the balance? The balancing process is a dynamic process guided by China's general concept and policy guidelines against the virus. So, we should understand the balance between COVID-19 prevention and control and economic and social development from a macro, collective and dynamic perspective. It is about dealing with the relationship between short-term and long-term considerations, between part and whole, and between individuals and groups. Specifically, while implementing specific strategies and measures, we may have inconvenienced parts of areas and people in the short term and made the economy of parts of areas suffer for a short time. Still, we have ensured the normal production and life of the broadest areas and people. I think it is cost-effective, also a balance. The Chinese government has been putting the goal of a well-balanced relationship between COVID-19 prevention and control and economic and social development as a priority. China has been striving to explore the approaches of balance and make efforts to do well in the balance, facing different epidemic situations and regions.
Thank you.
_ueditor_page_break_tag_Red Star News:
The NHC recently said that China's anti-epidemic work has entered the fourth stage -- the stage of all-round comprehensive epidemic prevention and control in a scientific and targeted manner following the dynamic zero-COVID approach. When did China enter this stage? Why the need to adjust? Thank you.
Li Bin:
Thank you for your question and attention on China's epidemic prevention and control stages. During more than two years of China's anti-epidemic work, we have optimized and adjusted prevention and control measures and diagnosis and treatment schemes depending on the epidemic situation. We have always followed the people-centered development philosophy in fighting against the epidemic. China's epidemic prevention and control work has included four stages: first, the emergency containment stage of the epidemic outbreak. We achieved a decisive result in fighting the virus in Wuhan city and Hubei province in about three months, and successfully contained the spread of the virus in China. Second is the exploration stage of regular epidemic prevention and control. China has mainly used nucleic acid testing as a major way to strengthen prevention, and strived to control an epidemic situation within two or three incubation periods. The third is the stage of targeted prevention and control following the dynamic zero-COVID approach across the whole chain. We have focused on early detection and meticulous and fundamental measures, and grasped the "golden 24 hours" after detecting positive cases to contain the epidemic within the first incubation period. Currently, China's anti-epidemic work has entered the stage of all-round comprehensive epidemic prevention and control in a scientific and targeted manner following the dynamic zero-COVID approach.
The Omicron variant is highly infectious, highly transmissible, difficult to detect, and can cause a larger proportion of asymptomatic infections. We summarize experiences from different regions and continue to improve COVID-19 response measures. As for COVID-19 prevention and control measures, we make clear our main focuses, set priorities for these measures, and put community-level prevention and control in a prominent position. We control the population at risk within the particular region at the earliest time. Infected patients will all be treated, and close contacts will all be isolated. We also isolate people who are secondary close contacts of COVID-19 cases in designated places as possible as we can, striving to cut off the transmission routes in the shortest time. We work to advance antigen tests and nucleic acid tests in order to detect infected cases as early as possible. Public security, industry and information technology, and public health departments have worked in synergy to conduct epidemiological investigations, identify the scope of the population at risk, and take targeted prevention and control measures. As for the organization and management of disposal of COVID-19 cases, we work in a well-coordinated and efficient way and try to run faster than the virus. Based on the principle of centralized and overall planning, we work to ensure that all processes, including nucleic acid testing, epidemiological investigation, isolation, transferring, and community-level prevention and control can be operated in a well-coordinated manner, striving to shorten the possible time from positive screening test to final transfer. We focus on high-risk regions and mobilize our best efforts to secure victory in key regions so that the transmission of the virus can be curbed as quickly as possible.
In general, no matter how the epidemic situation goes, we will always put people and their lives first and take prudent efforts to ensure the COVID-19 response measures are implemented. Thanks.
_ueditor_page_break_tag_ITV News:
Mr. Liang Wannian, you mentioned some cities have already battled some Omicron outbreaks. In those cities, it has taken generally far less than it has taken in Shanghai, where they're entering their second month of lockdown. The numbers are still rising. Do you know why that is? Why has the situation become so bad in Shanghai? You did mention there is a high elderly population there. Can I also ask if China has any plans to roll out mRNA vaccines? Thank you.
Li Bin:
Your questions cover two aspects. The first one will go to Mr. Liang, and the second one on mRNA vaccines will go to Mr. Lei.
Liang Wannian:
Thank you. Shanghai is now still at a critical stage to control the epidemic. Also, as we see, data from the reported cases show a downturn in the curve. It is gradually decreasing on a high base. All these demonstrate that our series of efforts and strategies to respond to COVID-19 are taking effect and effectively curbing the surge of cases. The situation shows signs of improvement. However, with about 10,000 new COVID-19 cases reported every day in Shanghai, the situation remains grim and complex.
Shanghai and Beijing are megacities with a large population base, high population density, and high population mobility, which pose significant difficulties for prevention and control. For such a large population, nearly 25 million people in Shanghai, we need systematic, considerate, and extensive allocation of resources, mobilization, and coordination to effectively organize a nucleic acid test and implement a specific anti-epidemic measure. It is a systematic project involving the municipal government, districts, and specific sub-districts and residents' committees. It is one of the difficulties. It cannot be done quickly and well like some other cities and areas do.
Second, it requires us to have a strong capacity against the virus. Like the frequently discussed time and space in academic fields, it requires different capacity levels against the virus in our system, nucleic acid testing capacity for example. For a city with 1 million people and one with 25 million, it will take longer in the case of insufficient capacity but may take merely 24 hours when there is sufficient capacity. So, that is another challenge.
Moreover, city operation must be ensured in the anti-epidemic fight. The supply of water, electricity, coal, and gas and public security needed in the running of the economy and people's everyday lives must be ensured. For example, couriers, transportation, medical staff and services, community organizers, and volunteers are necessary, so there has been a certain level of mobility. Given the extensive virus spread in communities in Shanghai, such population mobility is bound to bring greater risks to prevention and control.
When the virus is quickly spreading in such a big city, it requires adequate preparations and resources to ensure the policy of ensuring that all those in need are tested, quarantined, treated, or restricted was implemented. If no adequate preparations and resources like hospital beds, infected cases, confirmed cases, close contacts, and secondary close contacts would be stranded in communities, resulting in virus spread in families and communities. It is also a challenge for Shanghai to ensure the policy of ensuring that all those in need are tested, quarantined, treated, or restricted was implemented effectively. Still, we are pleased to see that Shanghai is heading in the right direction, with remarkable progress in medical treatment and sufficient beds in makeshift hospitals. It took some time to get there. Shanghai went through a difficult period some time ago, which has to do with many aspects, including the characteristics of the city, the rapid spread of the virus, the level of our overall resources, and the mobility of the people.
Finally, Shanghai has a high population density. Since the outbreak in the city, the epidemic has spread widely in the community. Compared with single or regional cluster cases, the prevention and control measures for widespread community transmission have more difficulties. Therefore, it might take longer, and measures such as nucleic acid testing, antigen testing, and screening strategies may be needed more frequently.
Thank you.
Lei Zhenglong:
Regarding mRNA vaccines, China has arranged several research and development tasks. Some with faster timelines are conducting phase III clinical trials abroad, and some are in the process of review and approval. For details, please consult the relevant departments. Thank you.
_ueditor_page_break_tag_Beijing Daily:
Under the principle of dynamic zero-COVID, how to make epidemic prevention policies more conducive to the resumption of work and production and minimize the impact on ordinary people? How to ensure efficiency and humanization and better promote the smooth implementation of dynamic zero-COVID? Thank you.
Lei Zhenglong:
Thank you for your questions. Since the outbreak of COVID-19, we have firmly implemented the decisions and deployments of the CPC Central Committee and the State Council, actively guided local governments to strengthen scientific and targeted prevention and control measures, and unswervingly adhered to the overall strategy of preventing imported cases and domestic resurgences and the general policy of dynamic zero-COVID. As we deepen the understanding of COVID-19, our prevention and control policies and measures have been constantly adjusted and improved in accordance with the changing epidemic situation and the actual needs of the prevention and control work to coordinate better the epidemic prevention and control with social and economic development.
First, we have continued to improve the scientific and precise epidemic prevention and control level. According to the epidemic prevention and control situation, we have kept improving the epidemic prevention and control plan. After the outbreak, we have strived to find close contacts and sub-close contacts as soon as possible, shorten the time for infected persons and close contacts to linger in communities, and reduce the spread of the epidemic. Medium- and high-risk areas have been demarcated in a scientific method, and a multi-level, category-specific, and targeted approach has been adopted in different areas. In community prevention and control, lockdown area, control area, and prevention area have been precisely classified.
Second, we have done our best to minimize the negative effects of the pandemic on the public. We not only fought the virus with strict and effective control measures but also provided considerate services, making every effort to meet people's demands for medical treatment. We gathered information on patients needing special treatment in lockdown and control areas. We precisely synergized communities with designated hospitals, ensuring that residents can leave the community to see a doctor. To guarantee necessary supplies, we coordinated our efforts to improve the all-level delivery system and enhanced the allocation of daily supplies. We pooled strength from communities' social organizations, committees of property owners, real property management, and service enterprises as well as volunteers to collect information on each household's needs, place joint purchase orders and deliver necessities, providing residents with sufficient supplies, considerate services, and warm care.
Third, we promoted the resumption of work and production in an orderly manner. To ensure smooth traffic and logistics, localities and relevant departments adopted closed-loop management, which requires drivers and conductors to regularly conduct health monitoring and take a nucleic acid test. We also improved our pandemic response measures for those on the road. A large number of checkpoints for the nucleic acid test have been installed to ensure drivers can conveniently take tests and go and could be traced at any time. Meanwhile, we coordinated pandemic response with the transportation of key materials and agricultural production. Precise pandemic response measures have been proposed for various agricultural scenarios so as to guarantee a smooth production and a stable supply of agricultural products. Thank you.
_ueditor_page_break_tag_Cover News:
Based on the fact that the Omicron variant is much harder to detect and more contagious than the original strain, some people argue that it is not easy to realize early quarantine, thus making dynamic zero-COVID approach almost equivalent to a citywide closed-off management and mass nucleic acid test. What's your view? How to contain the spread of the virus as early as possible without conducting mass nucleic acid tests or imposing a citywide lockdown? Thank you.
Liang Wannian:
Thanks for your question. First of all, I want to make it clear that even though the Omicron variant is highly contagious, hard to detect, and results in many asymptomatic cases, it doesn't mean that we can't realize early detection early reporting, early quarantine, and early treatment. If the "four earlies" principle is conscientiously observed, we don't have to launch a mass nucleic acid test or put a whole city under lockdown. So, my point is that fighting Omicron doesn't necessarily imply a citywide mass nucleic acid test or citywide closed-off management.
What kind of test strategy shall we adopt? At present, we advocate a joint test strategy featuring conducting nucleic acid tests and antigen self-test based on the development of the pandemic. Generally speaking, the earlier the transmission is detected, the easier it is to figure out its chains. That's to say, we can more precisely find out how the cases are infected, who their contacts are, and people in which areas might be affected, thus doing a better job in terms of the "four earlies." We can then conduct the nucleic acid test and antigen self-test within a targeted area instead of imposing an extensive lockdown. This is very important.
Can we effectively control the pandemic without city-wide nucleic acid testing and lockdown? I would say it's possible as long as we can ensure "early detection, reporting, quarantine and treatment." While to guarantee the "four earlies," it requires a set of concepts, capacities, and mechanisms. Therefore, in response to the pandemic, I believe that all places across the country should make good preparations. The monitoring capacity, discovery and reporting capacity, quick reaction capacity, the participation of multiple departments and individuals, the alerts, and degree of emphasis on diseases are highly relevant to achieving the "four earlies."
On the other hand, if we fail to achieve the "four earlies" and discover the cases late, in particular, for some infected patients, if we can't figure out where they are from, how many people have been exposed to, and the spread range. The basic reproduction number of Omicron variant will hit 9.5 with its fast transmission speed. In addition, the median incubation period is three days, compared with the original strain of 5.4 days and the Delta variant of four days. Its time interval of intergenerational transmission is 2.83 days. Under the circumstance of without knowing its source of infection, the spread range, and close contacts of infected patients, given the variant's fast transmission speed, we must expand the range of control, enhance nucleic acid testing, strengthen relevant prevention and control measures, to keep the pandemic under control. I believe it is also the need for pandemic prevention and control.
Generally speaking, China has already been equipped with the technologies and approaches to achieve the "four earlies." For example, our nucleic acid testing technology and the extensively used COVID-19 antigen self-testing kits. The effective combination of nucleic acid testing and antigen self-testing could help to discover the potentially infected people as soon as possible across the places where there are COVID-19 outbreaks and resurgences. Moreover, we have made a series of regulations and requirements in the law. In addition, we have established a set of the comprehensive monitoring system, which has further enhanced our monitoring capacity. More importantly, we have accumulated abundant experience battling the coronavirus over the past two years. In terms of the emergency system, treatment system, people's participation in prevention and control, collaboration among departments, and the joint prevention and control mechanism, we have formed basic experience to curb the fast-spreading virus with fast response-ability, especially regarding the Omicron variant. As long as we can use those resources, we will achieve the "four earlies" and win the battle against COVID-19 at a minimum cost. Thank you.
_ueditor_page_break_tag_China Daily:
The difficulties of getting medical services in some lockdown areas have become a problem recently. I would like to know how to ensure the smooth operation of both pandemic control and medical services at the same time? Thank you.
Li Bin:
Thank you for your question. Coordinating relations between the pandemic prevention and control and regular medical services and ensuring people's needs for services are crucial to protect people's health and well-being. During the pandemic prevention and control process, it has always been our most concerning issue to maintain medical treatment in good order to deliver consistent medical services for the public.
Currently, the COVID-19 epidemic features a combination of sporadic cases in a few places and cluster outbreaks in some parts across the country. The prevention and control situation remains grim. Some areas were put under closed-off management, affecting people's medical treatment. Given this problem, the NHC has put forward precise requirements, made comprehensive arrangements, and provided guidelines for specific local situations. Local authorities have also taken adequate measures to do everything possible to ensure the public's medical needs. To solve this problem, we have mainly focused on the four points:
First, we must ensure the timely treatment of acute and critical patients. According to the deployment of the NHC, all localities are required to designate hospitals for those whose health codes turn "yellow" and open "cloud clinics." For the critically ill, buffer zones for emergency treatment, first-aid centers, operating rooms, and wards should be put into use in a timely manner when their nucleic acid test results are yet unknown. Medics should strictly implement the first consultation responsibility system and ensure the treatment of acute and critical patients, offer timely and effective treatment while protecting themselves, and should not refuse patients at any excuse to delay the treatment.
Second, we must meet the medical needs of special groups. Local epidemic prevention and control departments should conduct survey and develop a clear picture of the situation of patients with demand for hemodialysis, tumor radiotherapy or chemotherapy, as well as pregnant women and newborns in areas under closed-off management, so as to better provide continuous medical services. Community-level health care institutions should provide medical services for patients with chronic diseases by issuing long-term prescriptions and other means.
Third, we must guarantee access to essential medical services in areas with the resurgence of COVID-19. During the epidemic prevention and control period, we have raised the level of coordination, strengthened the inter-department coordination, and set up emergency helplines such as 120 and convenient service channels to ensure that the public can "connect to the emergency center and receive timely treatment." The closed-off management areas and restrictive control areas should constantly improve the operation mechanism of medical service management under the emergency state. Expert teams providing consultation and evaluation to needy people should be arranged. For those who need to go out for medical treatment, point-to-point transportation, and closed-loop management should be arranged to ensure residents in medical demand can leave the community and get into the hospital.
Fourth, we have coordinated epidemic prevention and control and medical services within medical institutions. The pandemic monitoring and early warning efforts in medical institutions have been further strengthened, and the procedures for handling public health emergencies have been improved. The emergency plan is immediately activated once confirmed cases are identified. While responding to emergencies timely and effectively, it is necessary to report to the local disease prevention and control departments to coordinate pandemic prevention and control in hospitals and society. The medical institutions where cases are identified cannot be shut down due to dealing with the pandemic. After taking closed-off management and restrictive control measures, the emergency response mechanism should be initiated swiftly to make sure that the key departments, including emergency, dialysis, operation, intensive care unit, and delivery, can continue to function. We must ensure critical patients can get timely treatment to minimize the impact of epidemic response on normal medical services in medical institutions. Thank you.
_ueditor_page_break_tag_The Straits Times:
I have two questions. First, China emphasizes that the costs and benefits of the dynamic zero-COVID approach should be calculated at the macro level. What is the tipping point where the costs exceed the benefits? What exactly are the costs? Second, China has taken the lead in recovering from the pandemic and has been looking for new ways to cope with the constantly mutating novel coronavirus. What has China done in recent years to intensify the capacity building of its medical system? Thank you.
Liang Wannian:
Thank you for your question. When calculating the costs and benefits of fighting against COVID-19, we should first make clear the local-overall relationship and short-term and long-term relationship and take a long, comprehensive, holistic and systematic perspective. Second, evaluating the costs and benefits of COVID-19 response involves more than economic or monetary factors. Life is priceless and cannot be measured with money. Therefore, to analyze the costs and benefits, we need to take a systematic, big-picture, holistic, and dynamic view to consider both the economy and people's livelihoods.
Theoretically, the strategies and measures adopted to fight the epidemic will definitely generate direct costs — such as significant labor, material and financial resources invested in vaccination, temporary treatment centers construction, and nucleic acid testing. At the same time, there will also be some indirect costs. For example, the pandemic response will restrict the mobility of some people in some local areas, which may impact the economy. In addition, there will be intangible costs, such as anxiety and other psychological problems incurred in people quarantined at home in the closed-off management areas and restrictive control areas.
In terms of benefits, we should also follow a dynamic and multi-layered approach and consider both direct and indirect benefits and even invisible benefits. China's policy of preventing imported cases and domestic resurgences and the dynamic zero-COVID approach have effectively prevented the pandemic's large-scale spread and outbreaks, thus protecting the health and safety of the people to the maximum. China has effectively avoided a loss in the per capita life expectancy and managed to ensure order in the life and work of the people and the economy of as many regions as possible. These are all direct benefits. Just as Mr. Li mentioned a moment ago, in 2020, China was the world's only major economy to achieve growth. In 2021, China's GDP grew 8.1% year-on-year, with a two-year average of 5.1%, ranking among the highest compared with the world's other major economies. In the first quarter of this year, our GDP expanded by 4.8% year-on-year. These statistics show that the dynamic zero-COVID approach suits China's conditions and effectively coordinates pandemic control with social and economic development.
Given the uncertainties brought about by the pandemic, the dynamic zero-COVID approach and the concrete anti-pandemic measures served as insurance for the 1.4 billion Chinese people against pandemic fluctuations and virus variants. The cost of the insurance is to sacrifice economic gains of a small number of people to ensure the welfare of the whole society at its most. The dynamic zero-COVID approach has also promoted the development of China's digital economy. For example, the telemedicine and big data technologies used in pandemic control have boosted the digital economy, firmly ensured the people's wellbeing, and protected the vulnerable. Meanwhile, through carrying out joint prevention and control and improving the governance capacities of communities, we have promoted the effective connection and coordination among departments of public services, between government and non-government entities, and between government administrations and the community governance services in their direct charge. I think these are all indirect or invisible benefits of the dynamic zero-COVID approach.
Medical treatment has always been a priority in China's pandemic control efforts. Attaching great importance to the work, the Chinese government has adopted a series of measures to ensure that all suspected and confirmed cases could be hospitalized and treated. Efforts mainly focused on the following aspects, especially after the appearance of Omicron.
First, we have improved the establishment and management of designated hospitals. We guided local authorities to set hospitals with strongly integrated capacities, high-quality medical treatment, and outstanding epidemic prevention and control techniques as designated hospitals to hospitalize patients. At the same time, clear requirements have been put forward for the number of beds in designated hospitals in cities with different populations. For example, in principle, in each of the cities above the prefectural level with 1 to 5 million permanent urban residents, the total number of beds in designated hospitals should not be less than 500. In megacities with 5 to 10 million permanent urban residents, the total number should not be less than 1,000. And in megacities with more than 10 million permanent urban residents, the total number should not be less than 1,500. Among them, the number of beds for severe cases shall not be less than 10% of the total number of designated beds. Besides, local authorities must set up a certain number of back-up designated hospitals to ensure that they can be vacated and put into use within 24 hours when needed.
Second, we have improved the establishment and management of makeshift hospitals. A hierarchical approach to diagnosis and treatment has been adopted. And a number of makeshift hospitals have been built and remodeled to ensure that they can be put into use within two days when necessary so that all those in need are hospitalized or treated. As of April 25, nearly 400 makeshift hospitals have been built or are under construction in China, with a total of more than 560,000 beds. In addition, there are clear requirements for the ratio of doctors to nurses and doctors to beds in makeshift hospitals.
Third, we have taken practical measures to promote the utilization of medical resources. We have guided local authorities to transfer COVID-19 patients whose symptoms meet specific conditions to makeshift and designated hospitals, maximizing the use of hospital beds. At the same time, local authorities are also required to strengthen epidemic prevention and control while ensuring daily medical service.
In addition, during this period of time, we have been raising the capacity for ICU treatment by providing necessary treatment facilities and equipment, strengthening the training of medical staff, revising and improving diagnosis and treatment standards in a timely manner, widely adopting traditional Chinese medicine, strengthening emergency treatment plans, training and exercise, and strengthening the reserve of emergency medical treatment supplies.
Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
The last question, please.
Zhinews of Shenzhen Satellite TV:
We have noticed that according to the World Health Organization (WHO) recently, the COVID-19 pandemic remains a Public Health Emergency of International Concern (PHEIC). It suggests countries take response measures at any time against a possible new round of COVID-19 breakout in autumn. What targeted epidemic prevention measures will China take accordingly? Thank you.
Lei Zhenglong:
Thank you for your question. We have noticed that in the WHO statement issued on April 13 on the eleventh meeting of the International Health Regulations Emergency Committee, it has determined that the COVID-19 pandemic continues to constitute a PHEIC. China has been paying close attention to the global pandemic situation and adjustment and changes in response strategies and measures of the WHO and various countries to further improve its prevention and control policies and measures. Autumn and winter are the seasons with a high incidence of respiratory infectious diseases. Since 2020, based on the national situation in COVID-19 prevention and control and the mutation of the virus, we have guided local authorities to improve the monitoring and early warning mechanism, strengthen epidemic risk assessment, and further implement the measures of early detection, reporting, quarantine and treatment. We have strengthened epidemic prevention and control at key links and carried out prevention and control of the coronavirus epidemic and other respiratory infectious diseases in a coordinated way, to effectively respond to the epidemic in autumn and winter.
This year, we will closely keep track of the COVID-19 pandemic situation and the mutation of the virus across the world. Considering that and based on the changes in the epidemic prevention and control situation in China, we will further increase the guidance for local authorities to prepare for the epidemic response in autumn and winter. Thank you.
Shou Xiaoli:
Thank you to all speakers and friends from the media. Today's briefing is now concluded. Goodbye.
Translated and edited by Zhou Jing, Huang Shan, Gong Yingchun, Zhang Junmian, Cui Can, Wang Wei, Yan Xiaoqing, Li Xiao, Li Huiru, Qin Qi, Wang Yiming, Zhang Tingting, Xu Xiaoxuan, Yuan Fang, Wang Yanfang, Xu Kailin, Liu Sitong, Chen Xia, Zhang Rui, He Shan, Liu Jianing, Wang Qian, Zhu Bochen, Dong Qingpei, Yang Xi, Zhang Jiaqi, Zhang Lulu, and Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
He Junke, convener of the ministerial-level joint meeting for implementation of the Medium- and Long-Term Youth Development Plan and first secretary of the Secretariat of the Central Committee of the Communist Youth League of China (CYLC)
Fu Zhenbang, director of the executive office of the ministerial-level joint meeting for implementation of the Medium- and Long-Term Youth Development Plan and secretary of the Secretariat of the Central Committee of the CYLC
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
April 21, 2022
Xing Huina:
Friends from the media, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO published a white paper titled "Youth of China in the New Era," and organized this press conference to introduce and interpret its main content.
The white paper fully implements Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, reviews Chinese youth's continuous struggle for national rejuvenation over the past 100 years under the leadership of the Communist Party of China (CPC), and presents the efforts being made by the CPC Central Committee with Comrade Xi Jinping at its core for the development of young people since the 18th CPC National Congress. It introduces China's policies and measures to promote youth development and showcases the achievements in this regard and young people's spirit in the new era. The document also calls for young people around the world to join hands and build a community with a shared future for mankind, and contribute their wisdom and strength to create a better world.
At around 18,000 Chinese characters, the white paper consists of foreword, main body and conclusion. The main body is divided into four parts: "The New Era: Great Times with Ample Opportunities," "All-Round Development in the New Era," "Shouldering Heavy Tasks and Responsibilities" and "Having a Global Vision and a Strong Sense of Responsibility."
The white paper is published in eight languages — Chinese, English, French, Russian, German, Spanish, Arabic and Japanese — by the People's Publishing House and the Foreign Languages Press. It is available at Xinhua Bookstore outlets across the country.
To help you better understand the white paper, we have invited Mr. He Junke, convener of the ministerial-level joint meeting for implementation of the Medium- and Long-Term Youth Development Plan and first secretary of the Secretariat of the Central Committee of the Communist Youth League of China (CYLC), and Mr. Fu Zhenbang, director of the executive office of the ministerial-level joint meeting for implementation of the Medium- and Long-Term Youth Development Plan and secretary of the Secretariat of the Central Committee of the CYLC. They will brief you on relevant information and then take your questions.
Now, I'll give the floor to Mr. He Junke
_ueditor_page_break_tag_He Junke:
Ladies and gentlemen, friends from the media, good morning.
It's my pleasure to be here and introduce to you the development of China's youth in the new era. First, on behalf of the ministerial-level joint meeting for implementation of the Medium- and Long-Term Youth Development Plan and the CYLC Central Committee, I would like to express my heartfelt gratitude to friends from all sectors for your long-term interest in and support for the development of China's youth.
Since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has been attaching great importance to young people, caring deeply about them, fully trusting them, and making tremendous efforts for their development. This has enabled China to make all-round progress and secure historic achievements in its youth development. In general, the overall development of Chinese youth has outperformed the country's economic and social growth, with multiple core indicators reaching the average level of middle- and high-income countries. In order to showcase the vigorous image of young Chinese people in the new era and comprehensively present China's policy position on youth, the ministerial-level joint meeting compiled and completed this white paper under the support of the meeting's member institutions such as the Publicity Department of the CPC Central Committee, the Ministry of Education, and the Ministry of Human Resources and Social Security.
The white paper is the first of its kind since the founding of the People's Republic of China in 1949 focusing on youth development. Based on a statistical and monitoring system for youth development initiated by the National Bureau of Statistics, we have given full play to experts and think tanks involved in the Medium- and Long-Term Youth Development Plan. We also pooled research resources on youth development from statistical reports, yearbooks and blue papers as well as agencies affiliated with the CYLC. As a result, the white paper objectively presents China's remarkable achievements in youth development since the 18th CPC National Congress and provides a group portrait of China's youth in the new era.
In terms of the environment for their growth, China's youth in the new era, living in the best times in Chinese history, enjoys better conditions for development, more opportunities to fulfill potential, more all-around protection and support, and a broader space to grow. They are embracing wonderful opportunities to secure a good career. As for their development and achievements, they are firmer in ideals and convictions with better physical and mental health, stronger intellectual foundations, and active participation in social activities. They sharpen skills through hard work and temper their abilities in adversity, displaying their ability to shoulder the responsibility of national rejuvenation. As for their sense of responsibility and accomplishments, they work hard and are dedicated in their work posts, lead the charge in difficult situations and emergencies, temper themselves through community service, take the lead in innovation and entrepreneurship, or spearhead cultural and ethical progress, showing their vibrancy with no fear of difficulties and hardships. Regarding their concern for the rest of humanity, they have more ways for external cooperation, and their "circle of friends" with whom they can communicate and cooperate continues to grow. They build consensus among youth through heart-to-heart communication and dialogue, work hand in hand on the journey towards a brighter future, embrace the world with greater openness and confidence, and show their broad vision to build a global community of shared future. The Chinese youth's spirit of vigor, confidence, and progress fully proves that it is completely correct for the Chinese government to uphold the Marxist view on youth, the principle that the Party exercises leadership over youth, and the concept of giving priority to youth development. The leadership of the Communist Party of China and the socialist system are the fundamental reasons for China's historic achievements in youth development and also the fundamental basis for its further development.
As the principal challenge facing Chinese society in the new era has changed profoundly, and the world is witnessing profound changes unseen in a century, we are also aware that many new situations and challenges are emerging in the country's youth development. People from all walks of life and groups are faced with many pressing difficulties and problems that need to be resolved, demanding care, understanding and collaborative support from all sectors of society. We will bear in mind the current realities of China's development and the fundamental dimension of the country's national context as well as the overall and long-term interests of the Chinese nation, fully recognize the crucial strategic role of youth, and continue to increase policy support in all fields so that young people can unleash more talents and contribute more to the great cause of national rejuvenation.
In just over 10 days, we will celebrate the 100th anniversary of the founding of the Communist Youth League. As an advanced youth organization under the leadership of the Communist Party of China, the league has always taken serving youth development as one of its important duties. We will fully implement Xi Jinping's important thinking on youth work, respond to the voices and demands of the youth in a timely manner, step up efforts to strengthen policy and social advocacy, give full play to our role as a bridge and bond connecting young people and serving them, coordinate the implementation of the Middle- and Long-term Youth Development Plan to realize greater achievements, and take concrete actions to set the stage for the Party's 20th National Congress.
That's all for my introduction. Thank you!
_ueditor_page_break_tag_Xing Huina:
Thank you for your introduction, Mr. He. Now the floor is open for questions. Please identify the media outlet you represent before asking questions.
China Media Group:
We note that the Middle- and Long-term Youth Development Plan (2016-2025), the first plan directed toward young people in the history of China, is repeatedly mentioned in the white paper. Mr. He, over the past five years since it was introduced, what have we done to serve youth development and promote the implementation of this plan? Thank you.
He Junke:
Thank you. I will take the question. The Middle- and Long-term Youth Development Plan (2016-2025) was enacted under General Secretary Xi Jinping's personal direction, commitment, and concern. The plan is new for us. In China, policies related to youth development were scattered among various ministries and departments in the past. It is the first time for us to integrate them together and consider their coordination and cohesion. It has been five years since the plan was enacted. We have made great progress in the past five years under the concern of various sectors. The progress mainly includes the following aspects:
First, institutional systems to support youth development have been continuously improved. These systems include seventeen or eighteen laws directly related to youth development guided by the spirit of the Constitution. Some of them have been revised over the years, which have fully considered the current situation of the development of times and the youth and built a basic legal support system. In addition, the planning system framework involving youth development has been fully established. The State Council issued the Middle- and Long-term Youth Development Plan (2016-2025), and all provinces issued their provincial youth development plans. Some prefecture-level cities, counties, and districts also revealed their youth development plans. In terms of institutional and policy systems, some requirements of youth development have been included in the 13th and 14th Five-Year Plans for National Economic and Social Development, in which special chapters and sections have contributed to the requirements, with the needs of youth development addressed. In addition, various ministries and commissions have formulated many specific policies in their work field and within the scope of their specialties. According to our rough statistics, various central government departments have issued more than 80 specific policies to support youth development in recent five years. Thus, a complete institutional system has been established within the scope of institutional systems.
Second, a coordination mechanism for promoting youth development has been established. I am the convener of the inter-departmental joint meeting mechanism for implementing the middle- and long-term youth development plan at the national level. There are 51 ministries and commissions participating in the mechanism, one of our country's most extensive coordination mechanisms. Seventeen departments are regularly involved in the work of the mechanism, and the other 30 odd departments often take concerted actions. Such coordination mechanisms have also been established at the provincial, city, and county levels. In addition, Party and government leaders in the region serve as conveners, and relevant departments participate.
Third, substantive progress has been made in addressing pressing difficulties and problems that are of the greatest concern to young people. This is the most fundamental foothold. In recent years, all localities have revealed many specific policies in light of local conditions to address such issues in the fields of education, employment, entrepreneurship, marriage and fertility, support for the elderly, and housing. Take housing as an example. Young people face many difficulties in housing in big cities. Many provinces have made some explorations in this regard. For example, Guangdong Province implemented a youth settlement program in 2020 and has made constant efforts, which have helped more than 7,000 college graduates settle down in public rental housing units. Not long ago, Beijing turned more than 600 departments into public rental housing units available for fresh graduates for the first time. These are important explorations and have also satisfied real needs.
The Central Committee of the CYLC has also played the role of a bridge that links the Party with the youth very well in these respects. More than a decade ago, we began to establish a face-to-face communication mechanism between the Communist Youth League members and the deputies to the People's Congress, and members of the Chinese People's Political Consultative Conference to propose some prominent problems in youth development in an orderly manner, and via these two channels let young people' voice be heard and carry out policy advocacy.
Fourth, in recent years, we have focused on exploring more effective ways to promote the implementation of the plans and made great efforts to integrate fragmented policies to promote youth development. For example, two years ago, we launched pilot programs in more than 400 districts and counties across China and gained a lot of inspiration. In the past more than one year, more than 90 cities across the country have explored ways of building youth-development-friendly cities conducive to young people's growth and progress. We will continue our efforts in this regard.
Generally, thanks to our efforts over the past five years, a preliminary policy system and working mechanism for youth development with Chinese characteristics has taken shape, which we set out five years ago. But, of course, this is a long-term task. So, we will continue to take advice from all sectors and improve our work. So that's my answer, thank you.
_ueditor_page_break_tag_Youth Daily:
The white paper points out that Chinese youth live during great times with ample opportunities in the new era. They are of the highest caliber and have the opportunity to achieve all-round development. Can you introduce important achievements regarding youth development since the Party's 18th National Congress in 2012? Thank you.
He Junke:
The white paper titled "Youth of China in the New Era" mainly depicts the conditions of the contemporary youth and achievements in youth development since the Party's 18th National Congress in 2012, when socialism with Chinese characteristics entered a new era. With the cordial care of General Secretary Xi Jinping and the support of the Party and the government, China's youth development scored historical achievements since the Party's 18th National Congress in 2012, mainly in the following aspects.
First, material conditions underpinning youth development have improved markedly. China's GDP exceeded 110 trillion yuan in 2021. With rapid development as a foundation, China can provide more material support for youth development. Each year, the country's expenditures in R&D and education total more than 2 trillion yuan and 4 trillion yuan, respectively. In addition, China spends more than 200 billion yuan annually on financial aid for students of all educational stages from poor families. These conditions are the most important material foundation for youth development, which is a huge achievement.
Second, contemporary youths enjoy colorful intellectual and cultural life. Traditional public cultural facilities such as museums and cultural centers have rapidly developed. According to a document I saw, a museum is built every two days on average, and this speed and intensity of investment are great. Cultural industries such as movies, television and artistic performance, and emerging cultural sectors such as the digital creative industry, online audio and visual, digital publishing, and online performance and broadcasting have developed fast. Young people can watch whatever they want to watch. Furthermore, the transportation and information industries are advanced, especially transportation. As the saying goes, "read thousands of books; travel thousands of miles." The youth now have the opportunities to travel everywhere conveniently and go wherever they want. The internet has been an integrated part of the youth's lives. Compared with historical records, the internet accessibility of the youth aged between 20 to 29 is almost 100%, while the number was 68% a decade ago, according to the statistics I saw. Ten years ago, the gap in internet accessibility between cities and rural areas were still obvious, but now the gap has almost been eliminated, with nearly 100% internet accessibility. These provide favorable conditions to enrich young people's intellectual and cultural life.
Third, youth health conditions have been improved, especially the changes in their bodies, as we have basically solved the problem of malnutrition in the youth. In terms of body shapes, the youth are taller and stronger. For young people aged between 20 and 24, men are 1.6 centimeters higher and four to five kilograms heavier on average than those of 10 years ago. Young women are 1.5 centimeters higher and two to three kilograms heavier on average. Generally, young people have grown taller and stronger within standard heights and weights. Besides, we have noted problems such as a high incidence of near sight in youth, and the authorities have been taking responsive measures. We have also noticed that some young people face pressures from work, study and life, and their psychological health has caught great public attention. But generally, according to our surveys, most young people are psychologically healthy. Some of them have grown more resilient after experiencing setbacks. All these show that the youth are better physically and mentally fit.
Fourth, young people have received a higher and better education. The new additions to the workforce of 2020, which were mainly young people, had an average education of 13.8 years, equivalent to the first or second year of college. The gross enrollment rate in higher education was 57.8% in 2021, more than double the 26.9% rate in 2011. That means higher education has started to become universal in China. Compared with previous records, young people have received the highest and best education in history.
Fifth, employment opportunities for youth have become more sufficient and diversified. Notably, a great number of rural youth have to the opportunity to give full play to their talents and competencies at a higher industrial level through horizontal and vertical mobility. The number of migrant workers reaches nearly 170 million, most of who are young people. They will have opportunities to leap forward to a higher industrial level. It has been uneasy to solve this kind of employment problem on such a large scale. We have also noticed that as China's economy keeps developing – especially in the tertiary industry – the employment structures and career options have greatly upgraded and expanded for youth. The job category has become more diversified compared with the past. "Slash youth" we have spoken about are defined as young people with multiple titles, jobs, and ways of working and living. All these have led to the greater range of opportunities and choices available to young people.
Regarding the employment of college graduates, our country has always attached great significance to this issue over recent years. This year, the number of graduates of China could surpass 10 million, which is good news for our country as we continue to have many well-educated students joining the workforce every year. It's most welcome news. Of course, there are many difficulties when they seek jobs. However, that's an issue for another field. Thanks to the concerted efforts from various parties, the first-time employment rate of China's graduates has stayed above 77%in past years and then reached over 90 percent by year end, underpinning a fairly good employment in China.
Therefore, generally speaking, since the 18th CPC National Congress in 2012, youth development in China has achieved great progress. All of these achievements are ultimately attributed to the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core and the scientific guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and demonstrate the advantages of the system of socialism with Chinese characteristics.
_ueditor_page_break_tag_Phoenix TV:
The white paper has published the percentage of young permanent urban residents, which for the first time is much higher than that of the overall permanent urban residents. The government has also issued the Opinions on Launching the Pilot Program of Youth Development-Oriented Cities. I would like to know what are the major concerns in building such cities? What kinds of measures will be taken in the future? Thank you.
He Junke:
Thank you. Mr. Fu will answer your questions.
Fu Zhenbang:
The youth are attracted to cities, and the cities thrive thanks to the youth. In 2020, young permanent urban residents accounted for 71.1 percent of the total young population in the country. This percentage will keep growing in the future. In the course of China's rapid urbanization, youth are beneficiaries and contributors, and the core driving force. The building of youth development-oriented cities is an important approach to earnestly promoting the people-centered urbanization strategy, as well as a key leverage to vigorously accelerate the implementation of the Middle- and Long-term Youth Development Plan (2016-2025). It is helpful for enhancing the mutual reinforcement between high-quality development of youth and that of cities. We have the following concerns in carrying out this project:
First, it is a requirement for cities to ground efforts in the new development stage, implement the new development philosophy, and build new development patterns. The overall development of youth is an important component of high-quality economic and social development of cities, as well as an important driving force for building cities' new development patterns. As the population size and structure of youth have both undergone historical changes in China, youth as the key factor in promoting the development of cities have become more valuable. Advocating and practicing the concept of giving top priority to youth development will promote their roles in urban development and further stimulate the vitality of cities.
Second, this is an inevitable choice to adapt to the strategic trend of new urbanization and promote youth development. China's urban development has shifted from high-speed development to high-quality development. Over the past decades, great achievements have been made in China's urban development, but problems have also accumulated. Cities are the place where the youth are most concentrated and also where the pressure and contradictions of youth development congregate. Some cities face prominent problems where youth find it hard to secure employment, housing, and living. It is fair to say that without the high-quality development of young people, there would be no high-quality development of cities.
Third, this is a summary and improvement of some cities' pioneering exploration. During the implementation of the Middle- and Long-term Youth Development Plan (2016-2025) in recent years, more than 90 cities, including Shenzhen, Chengdu, Jinan, Ningbo, Suzhou, and Luoyang, have proposed to build themselves into youth-development-friendly cities and promoted relevant work. Shandong, Guizhou, Zhejiang, and other provinces have proposed to build themselves into youth-development-friendly provinces. These local explorations and practices have laid a foundation for us to deploy this work at the national level.
Fourth, this draws on international urban development experience. In recent years, some Western countries have promoted urban progress from the perspective of youth development and paid more attention to promoting peace and contentment in work and life for youth by making efforts in such areas as laws and regulations, development strategies, and public policies. Some countries have designed, promoted, and boosted the youth development indicator system from the perspective of urban attractiveness and public facilities supply. All these practices are useful for us to learn from to do relevant work well.
On April 1, 17 ministries and commissions, including the Publicity Department of the CPC Central Committee, the National Development and Reform Commission, and the Central Committee of the CYLC, jointly issued the "Opinions on the Pilot Construction of Youth-Development-Friendly Cities." The opinions clearly put forward the urban development philosophy of making cities more friendly to youth and enabling youth to make more achievements in cities. It champions giving priority to youth development and correctly understanding and guiding the dialectical relationship between youth development and urban development. The opinions have also made arrangements for the guiding ideology, basic principles, main contents, and work requirements of building youth-development-friendly cities.
To make cities promote high-quality youth development, the opinions proposed that efforts should be redoubled to optimize the seven aspects: a planning environment prioritizing youth development; a fair and quality education environment; an employment environment inspiring youth to harness their talents; a residential environment ensuring youth's basic housing needs; a living environment alleviating the difficulties faced by youth in relationship, marriage, childbirth, and upbringing; a healthy environment promoting the youth's physical and mental development; and a safe environment effectively safeguarding the youth's rights and interests. In a nutshell, these efforts aim at ensuring that young people's rights to education, life, subsistence, labor, habitation, and other rights and interests are fully secured and that cities can provide better space, platforms, environment, and conditions for young people to grow, excel, and succeed.
To make the youth contribute to the high-quality development of cities, the opinions proposed to mobilize the youth in leading cities' civility and morals, participating in innovation and entrepreneurship, making contributions to their positions, partaking in social governance in an orderly manner, and helping improve the citizens' quality of life. In other words, these proposals were designed to let the youth be the main part and masters of urban development so that they can contribute to the high-quality material, political, cultural, social, and eco-environmental progress in cities.
As we can see, the opinions have attracted wide attention and triggered heated discussion in society after its release. Many cities are actively applying for relevant pilot projects. These cities are wise and far-sighted since winning the hearts of youth means securing success both in the present and in the future. In pursuing this work, we do not apply a one-size-fits-all approach. Instead, we fully respect the realities at the community level and take the approach of conducting pilot programs before launching nationwide measures. We also welcome cities that have not taken part in the pilot projects to voluntarily engage in. We hope that after two years of implementing pilot programs, dozens of cities can be identified for pioneering exploration and give rise to a set of practices that can be replicated to facilitate young people's work, study, settling down, living, and child-raising. In this way, we hope to help solve the pressing difficulties and problems that are of the greatest concern to young people, give better play to their abilities in innovation and creativity, and promote high-quality urban development.
We recognize that the work needs long-term efforts, so care and support and opinions and suggestions from all sectors of society, including friends from the media, are welcomed and appreciated. We also hope that Party committees and governments at all levels will attach significance to building youth-development-friendly cities by adding more efforts to their organizing work and guidance to make our cities more suitable for the youth to live and work. Furthermore, we believe that the phased-in implementation of the Opinion and the practical exploration of pilot cities, starting with individual practices that are expected to be applied in a larger scope, will surely promote the effective and in-depth implementation of the medium and long-term plan for youth development. Backed by such efforts, we will be able to continue to increase the sense of fulfillment, happiness, and security of the youth in the development of cities, reflect the Party's institutional strength of its youth work in the effective policies and deliver the care and support of the Party to the youth. Meanwhile, we will pursue a new way for high-quality city development in the new development stage. That's my answer. Thank you.
_ueditor_page_break_tag_Southern Metropolis Daily:
Generation Z are internet-savvy, willing to express themselves and take the lead on various internet platforms. So what should Chinese young people do in the face of choosing between "lying flat" (a term to describe the youngsters who give up ambitions and do the bare minimum to get by) and "involution" (one buzzword that indicates irrational or involuntary competition)? What does the CYLC suggest? Thank you.
He Junke:
I'll take this question. In recent years, we often see a variety of buzzwords from the media, such as "lying flat" and "Buddha-like." We have attached much attention to them, as the focus of the CYLC's job is to serve the young people. We have carried out many surveys and research, and now I would like to share what we have achieved with you.
First, we observed that only a very few young people chose to "lie flat," instead, a majority of young people are working hard. In recent years, we have carried out a number of surveys and research on the spiritual pursuit of modern young people. We noticed they believe that success depends mainly on personal efforts, which remains the mainstream belief among modern youth. Most of them are optimistic about their future. Based on these surveys and research, we believe that terms such as "lying flat" and "Buddha-like" are often used for relieving stress and regulating emotions.
Second, our country has emphasized addressing underlying problems behind the "lying flat" and "Buddha-like" mindset. Although most young people will not choose to "lie flat" or live with a "Buddha-like" mindset, they are facing great and realistic pressures from work, study, and life, in China's unique population structure and heated population competition environment. Faced with major life choices, young people often become confused, lose their sense of direction or else feel powerless. Similar cases also existed in the old days. Therefore, in recent years, our country has intensified its policy efforts to address difficulties in youth education, employment, marriage, and love, as well as child nurturing, in a bid to help young people to solve urgent and difficult issues.
Third, we wish the whole of society could care more about mental health among youth. A small number of young people are locked in cocoons after dwelling on negative emotions for a long time. Due to various reasons, they lack a fighting spirit and have little sense of responsibility for their families and society. Some are unrealistic and dream about easy success. We need to build a sound social environment to influence them in a positive way. Happiness is achieved through hard work, while hard work itself is a form of happiness. This motto from General Secretary Xi Jinping delivered to Chinese youth is something we should all do our best to understand.
_ueditor_page_break_tag_CRNTT:
Youth volunteers made significant contributions to the successful hosting of a splendid, exceptional, and extraordinary Beijing 2022 Olympic and Paralympic Winter Games and the phrase of "Youth of China in the New Era" appears many times in this white paper. What are the distinctive characteristics of China's youth in the new era? Thank you.
He Junke:
I will take this question. About 20,000 volunteers served the Beijing 2022, showcasing quite a fine image of the Chinese youth. Volunteers serving in competition venues remained there and worked really hard for two to three months with a strong sense of devotion and sacrifice. Their outstanding performance has won applause from the International Olympic Committee and the entire society. These volunteers epitomize the youth of China. People tend to be judgmental towards younger generations. We used to doubt whether the youth born in the 1980s, the 1990s, or the 2000s could shoulder the heavy tasks of the times. Lots of observations and practices have echoed what General Secretary Xi Jinping said about the vigorous youth: they are the most vibrant and the most creative group of society.
The youth of China today impress me in the following aspects: First, they are firmer in ideals. We are often touched by their love for the leader of the Party, their confidence, belief, and trust in the Party and the system of socialism with Chinese characteristics, as well as their full assurance in the future of the country's development. Both domestic and foreign surveys show that 80-90% of Chinese people, including the youth, have confidence and trust in their country and government, a ratio that remains the highest among all countries. The youth don't just say it but firmly put it into practice. Among the excellent examples of the youth we award, some are college graduates turned village officials, some are innovators and pioneers in the field of science and technology, and some are hard-working young people dedicated to ordinary jobs, all demonstrating the lofty value of pursuit.
Second, they have stronger intellectual foundations. In 2021, the gross enrollment rate in higher education reached 57.8%, which means that a majority of youth have the opportunity to receive higher education. We also notice that a large number of young people find ways to add to their knowledge base after work: Some seek continuing on-campus education for adults, while others pursue on-the-job postgraduate education, trying to keep up with the pace of knowledge renewal to enrich their thoughts. They are much more creative and are bursting with innovative ideas. Many young people have shouldered important responsibilities in implementing the country's major programs. In some emerging areas defined by innovation, such as the information technology service, cultural and sports entertainment, and sci-tech application services, more than half of the workforce is young people, exemplifying the innovative spirit and intellectual foundation of the youth.
Third, they are confident and optimistic. Frustrations and pressures surely make them dismayed or confused for a short time, yet overcoming all the difficulties only leaves them even more resilient, more candid, more self-assured, and more socially adaptive.
A questionnaire we launched on the emotions of China's young people showed that more than 80% of the respondents believed that they were capable of managing their emotions, which is very gratifying.
Fourth, they are very responsible. People used to think the youth of the 1990s and the 2000s lived an easy life and may not be able to take on heavy tasks. However, the major tests posed by the poverty alleviation campaign, COVID-19 response, as well as flood relief testified that they are responsible enough. In daily life, many youth who work hard at their posts, be it border guards, ordinary laborers, deliverymen, or ride-hailing drivers, are fulfilling their responsibilities to families and society through solid and industrious efforts.
Our work involves a fairly large number of volunteers. For 18 consecutive years, we organized volunteers to support education in remote and underdeveloped regions through the Go West program, engaging more than 400,000 virtuous, capable youth. Such experiences enabled them to develop in an all-around way. We have established a national database for youth volunteers, and so far, over 90 million are in the pool. Each year, many volunteers provide services to society through very good performance. As we have mentioned, most of the volunteers systematically mobilized to serve national games or exhibitions are college students who demonstrate a very good image of the youth.
Fifth, they have a broader vision. Nowadays, the post-figurative, co-figurative, and pre-figurative culture has become a topic. The youth today know much more than their elders. Every year, hundreds of thousands of youth study abroad, which might affected slightly due to the COVID-19 pandemic. And we also see roughly the same number of overseas returnees start their careers in China. Also, the youth get to know the world better and develop a broader vision through surfing the internet and making acquaintances with some of the hundreds of thousands of foreigners studying in China. They can value the relations between China and the world in a more objective and comprehensive way. To sum it up, we need to carefully protect and respect the youth of the new era and tap into their full potential. Thank you.
_ueditor_page_break_tag_Jiemian.com:
A record 10.76 million new graduates are expected to enter the job market this year, adding to the challenges the market is already facing due to COVID-19. What support measures are there to solve the employment difficulties of young people? Thank you.
Fu Zhenbang:
Employment is the cornerstone of youth well-being and development. The Party and the State have been attaching great importance to employment and strengthening the implementation of the employment-first policy. Different departments, including the Ministry of Finance, the National Development and Reform Commission, the Ministry of Education, and the Ministry of Human Resources and Social Security, have made concerted efforts to take various measures to promote the full employment of young people. Based on its own responsibilities, the CYLC has also done its best to promote youth employment. Faced with great employment pressure this year, China has increased finance input and policy support. The authorities have made great efforts in easing the difficulties of businesses, keeping the operations of market entities stable, and stabilizing employment. Great efforts have also been made in expanding the implementation of programs such as "San Zhi Yi Fu" and "Xibu Jihua" (through which graduates take community-level posts in education, agriculture, health care and poverty relief in the rural area and in western China) to continuously increase employment opportunities in the public sector. Much effort has been made in the introduction of special projects for the promotion of employment of college graduates, including the introduction of public employment services to campuses and visits of Party secretaries and presidents of colleges and universities to enterprises to expand job opportunities and bolster employment, to further improve the youth employment service system. Guided by the core principle of serving the youth and making full use of our organizational strength, the CYLC gives priority to the following four areas of work.
First, we guide young people to establish a positive outlook on employment, career choice, and how to strive for goals. More than a year ago, we published a book about interactions between Xi Jinping and college students . Recently, China Youth Daily serialized the stories from the 26th to 50th issue of the book, telling many vivid stories about choices of life paths and careers, offering valuable experiences for our contemporary college students to learn from.
Second, we have strengthened our work on ensuring employment for key youth groups. Since the end of last year, we have promoted the employment of college students, with a focus on providing targeted assistance and support for students from low-income households in non-key colleges and universities. This year, we have organized and mobilized league cadres at all levels, especially cadres of the youth league committee in colleges and universities, to offer one-on-one assistance to 72,000 such students. We do this by finding out about their basic situation before providing employment guidance and job matching. So far, we have found jobs for 25,000 disadvantaged students. We strive to provide targeted assistance and support for more than 50,000 students from low-income households in non-key colleges and universities this year.
Third, we promote youth entrepreneurship to boost employment. The CYLC has initiated a program for promoting youth entrepreneurship in China since 1998. This year, with mass entrepreneurship and innovation as the backdrop, we have further deepened the promotion of youth entrepreneurship and driven more youth employment through youth entrepreneurship. We encourage young people to start their own businesses, and place special focus on supporting college students' entrepreneurship, young people returning to their hometowns to start their own businesses, and technology-based entrepreneurship.
Fourth, we safeguard the legitimate rights and interests of youth in employment. On one hand, we cooperate with the authorities to strengthen policy advocacy, actively promoting the protection of employment and labor rights and interests of people working in new business forms and occupations. On the other hand, we pay special attention to the unfair treatment and infringement on rights and interests that college graduates may encounter during job hunting and provide necessary legal aid to support and guide graduates to consciously and effectively protect their rights and interests in employment.
We believe that, with the attention and support of the government and the care and support of the society, the Chinese youth in the new era will strive on their own, have their talents fulfilled, and create a fabulous life through hard work and wisdom. Their young lives will shine brilliantly as they participate in the great efforts of building a modern socialist country in all respects and realizing the Chinese Dream of national rejuvenation. Thank you.
_ueditor_page_break_tag_Xing Huina:
Due to time constraints, we will have one last question.
People.cn:
The white paper specifically refers to the International Youth Sustainable Development Index Report. As far as I know, this is the first time China has released such a report on the international index ranking of youth development. What's the original intention of conducting this research? How will this research promote youth development in China? Thank you.
He Junke:
Thank you. I will answer your question. The Middle- and Long-term Youth Development Plan (2016-2025) lists 10 key areas of youth development. These key areas concerning youth development are similar in other countries, including employment, education, social participation, etc. How do we measure youth development among countries with simplicity? Drawing on the design of the Human Development Index by the United Nations Development Program, we integrated the relevant data into a concise indicator system to evaluate youth development and related policy impact in various countries. We have also noticed that organizations such as the Commonwealth Secretariat, the European Youth Forum and the Social Progress Imperative have conducted similar studies based on their own positions and information.
The main purpose of our research was to conduct an in-depth analysis of the institutional and policy factors behind the different levels of youth development in different countries and also to better learn from the good practices of other countries in the formulation of youth development policies. Since February last year, a joint project group comprising China Youth and Children Research Center, China International Youth Exchange Center, the Center for Youth Moral Education, Tsinghua University, and the Research Center for Contemporary China at Peking University has been conducting in-depth research on this issue, and the research findings were presented in the International Youth Sustainable Development Index Report 2021, which was released last year. After its release, the report has attracted some attention in various fields and has received relatively positive feedback. This is the first international comparative study of youth development published by China. In terms of research methodology, by focusing on the key areas of youth development, the research selected five primary indicators and 17 secondary indicators, involving five domains of health and living, education and culture, employment and entrepreneurship, family and society, and social participation. The data we used was publicly available and comparable worldwide. In this way, the study finally picked 85 countries for objective, fair, and balanced data processing and evaluation.
China ranks 23rd, around the top 27%, of the 85 countries, higher than its positions in per capita GDP and Human Development Index rankings, which are 34% and 45%, respectively. This shows that the level of youth development in our country is ahead of the overall level of economic and social development, which also reflects the achievement China has made by prioritizing youth development. The excess is actually due to the superiority of the Chinese system and the correctness of the philosophy of youth development. Admittedly, we have also seen that there are still gaps in the rankings in some indicators. For example, in the education and culture domain, China ranks around the top 40%, which is relatively low. This prompts us to continue to improve the availability and quality of education for young people. As for youth health, although China ranks relatively high, around the top 15%, there are still many issues such as strength and myopia. And we also need to promote social public service among our young people.
In general, we will continue to learn from the valuable experiences of other countries in the world, based on the reality of our country, guided by the youth development index, to make China's youth policy more effective. Thank you.
Xing Huina:
Thank you to all speakers and friends from the media. Today's briefing is hereby concluded. See you!
Translated and edited by Yang Xi, Liu Sitong, Xu Xiaoxuan, Zhang Rui, Zhou Jing, Wang Yanfang, Li Huiru, Chen Xia, Liu Jianing, He Shan, Qin Qi, Wang Qian, Wang Yiming, Zhu Bochen, Duan Yaying, Xu Kailin, David Ball, Jay Birbeck, and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speaker:
Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and director general of the Department of Comprehensive Statistics of the NBS
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
April 18, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). This is a regular briefing on China's economic data. Today, we are joined by Mr. Fu Linghui, spokesperson of the National Bureau of Statistics (NBS) and director general of the Department of Comprehensive Statistics of the NBS. Mr. Fu will brief you on China's economic performance in the first quarter of 2022 and then take your questions.
Next, I'll give the floor to Mr. Fu.
_ueditor_page_break_tag_Fu Linghui:
Friends from the media, good morning. As usual, I will start by briefing you on the economic performance in the first quarter of this year and then take your questions.
In short, China's national economy got off to a generally stable start in the first quarter.
In the first quarter, faced with the multiple tests of an increasingly grave and complex international environment and frequent outbreaks of COVID-19 at home, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, all regions and departments have strictly implemented the decisions and arrangements made by the CPC Central Committee and the State Council, coordinated COVID-19 prevention and control efforts and economic and social development in a reasonable way, made economic stability the top priority, and pursued progress while ensuring stability. As a result, the nation's economic recovery was sustained and the operation of the economy was generally stable.
According to preliminary estimates, gross domestic product (GDP) in the first quarter reached 27.02 trillion yuan, up by 4.8% year on year at constant prices, or up by 1.3% compared with the fourth quarter of 2021. By industry, the value added of the primary industry was 1.1 trillion yuan, up by 6% year on year; that of the secondary industry was 10.62 trillion yuan, up by 5.8%; and that of the tertiary industry was 15.3 trillion yuan, up by 4%.
First, agricultural production was stable and animal husbandry grew steadily.
In the first quarter, the value added of agriculture (crop farming) witnessed a year-on-year increase of 4.8%. With generally favorable weather conditions and stronger agricultural production services, spring farming and preparation were carried out in a steady and orderly manner. According to the year-round planting intentions survey, the nationwide planting area intended for wheat and rice was generally stable and that for soy beans increased considerably. In the first quarter, the output of pork, beef, mutton and poultry was 23.95 million metric tons, up by 8.8% year on year. Of this total, the outputs of pork, beef and mutton were up by 14%, 3.6% and 1.4%, respectively. The output of milk increased by 8.3% and that of eggs went up by 2.5%. At the end of the first quarter, the number of pigs registered in stock was 422.53 million, up by 1.6% year on year, of which 41.85 million were breeding sows.
Second, industrial production grew quickly and the mid-to-high end manufacturing industry enjoyed sound growth.
The total value added of industrial enterprises above designated size grew by 6.5% year on year in the first quarter. In terms of sectors, the value added of mining increased by 10.7% year on year, that of manufacturing increased by 6.2%, and that of the production and supply of electricity, thermal power, gas and water increased by 6.1%. The value added of high-tech manufacturing and equipment manufacturing increased by 14.2% and 8.1%, respectively, which were 7.7 percentage points and 1.6 percentage points faster than that of industrial enterprises above designated size. An analysis by types of ownership showed that the value added of state holding enterprises was up by 5% year on year; that of share-holding enterprises was up by 7.8%; that of enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan was up by 2.1%; and that of private enterprises was up by 7.6%. In terms of products, the production of new-energy vehicles, solar cells and industrial robots rose by 140.8%, 24.3% and 10.2%, respectively. In March, the value added of industrial enterprises above designated size grew by 5% year on year, or 0.39% month on month. In March, the Manufacturing Purchasing Managers' Index stood at 49.5%, and the Production and Operation Activity Expectation Index was 55.7%. In the first two months, the total profits by industrial enterprises above designated size reached 1.16 trillion yuan, up by 5% year on year.
Third, the service sector continued to grow and modern services registered a solid growth momentum.
In the first quarter, the service sector continued to recover. Specifically, the value added of information transmission, software and information technology services and financial intermediation grew by 10.8% and 5.1% year on year, respectively. The Index of Services Production increased by 2.5% year on year in the first quarter and decreased by 0.9% year on year in March. In the first two months, the business revenue of service enterprises above designated size grew by 13.6% year on year. In March, the Business Activity Index for Services stood at 46.7%, and the Business Activity Expectation Index was 53.6%. Industries involving the close contact and gathering of people, such as railway transportation, air transportation, lodging and catering, were greatly impacted by the pandemic. The Business Activity Index for industries including telecommunication, broadcast, television and satellite transmission services, monetary and financial services, and insurance services stayed within the high expansion range of 55% and above.
Fourth, market sales maintained growth and online retail sales were active.
In the first quarter, the total retail sales of consumer goods reached 10.87 trillion yuan, up by 3.3% year on year. Analyzed by different areas, the retail sales of consumer goods in urban areas reached 9.43 trillion yuan, up by 3.2%, and that in rural areas reached 1.44 trillion yuan, up by 3.5%. Grouped by consumption patterns, the retail sales of goods were 9.8 trillion yuan, up by 3.6%; the income of catering was 1.07 trillion yuan, up by 0.5%. Goods related to people's basic living enjoyed good sales, with the retail sales of grain, oil and food, and daily necessities by enterprises above designated size up by 9.3% and 6.6%, respectively. The sales of upgraded consumer goods grew fast. The retail sales of cultural and office supplies, and gold, silver and jewelry by enterprises above designated size grew by 10.6% and 7.6%, respectively. Online retail sales reached 3.01 trillion yuan, up by 6.6%. Specifically, the online retail sales of physical goods were 2.53 trillion yuan, up by 8.8%, accounting for 23.2% of the total retail sales of consumer goods. In March, the total retail sales of consumer goods reached 3.42 trillion yuan, down by 3.5% year on year and 1.93% month on month.
_ueditor_page_break_tag_Fifth, investment in fixed assets increased, and investment in high-tech industries and social sectors grew fast.
In the first quarter, the investment in fixed assets (excluding rural households) reached 10,487.2 billion yuan, up by 9.3% over that of the previous year. Specifically, the investment in infrastructure was up by 8.5% year on year; that in manufacturing was up by 15.6%; and that in real estate development was up by 0.7%. The floor space of commercial buildings sold stood at 310.46 million square meters, down by 13.8%. The total sales of commercial buildings were 2,965.5 billion yuan, down by 22.7%. By industry, the investment in the primary industry went up by 6.8%, that in the secondary industry up by 16.1%, and that in the tertiary industry up by 6.4%. Private investment totaled 5,962.2 billion yuan, up by 8.4%. The investment in high-tech industries grew by 27.0%. Specifically, the investment in high-tech manufacturing and high-tech services grew by 32.7% and 14.5%, respectively. In terms of high-tech manufacturing, the investment in the manufacturing of electronic and communication equipment and in the manufacturing of medical equipment, measuring instruments, and meters grew by 37.5% and 35.4%, respectively. Regarding high-tech services, investment in information services and services for the transformation of scientific and technological achievements went up by 21.3% and 19.0%, respectively. Investment in social sectors increased by 16.2%. Specifically, the investment in the health sector and education sector increased by 23.8% and 17.2%, respectively. In March, the investment in fixed assets (excluding rural households) went up by 0.61% month on month.
Sixth, imports and exports of goods witnessed rapid growth, and the trade structure continued to optimize.
In the first quarter, the total value of imports and exports of goods was 9,415.1 billion yuan, an increase of 10.7% over that of the previous year. The total value of exports was 5,226.0 billion yuan, up by 13.4%, while that of imports was 4,189.1 billion yuan, up by 7.5%. The trade balance was 1,036.9 billion yuan in surplus. The imports and exports of general trade increased by 13.9%, accounting for 63.2% of the total value of imports and exports, 1.8 percentage points higher than that of the same period of the previous year. Imports and exports by private enterprises accounted for 48% of the total value of imports and exports, 1.4 percentage points higher than the same period of the previous year. In March, the total value of imports and exports was 3,206.5 billion yuan, up by 5.8% year on year. The total value of exports was 1,753.5 billion yuan, up by 12.9%, and that of imports was 1,453 billion yuan, down by 1.7%.
Seventh, consumer price experienced mild growth, and the year-on-year growth of producer prices for industrial products slowed down.
In the first quarter, the consumer price index (CPI) grew by 1.1% over that of the previous year. Specifically, the CPI in urban areas went up by 1.2%, and that in rural areas went up by 0.7%. Grouped by commodity categories, prices for food, tobacco, and alcohol went down by 1.3% year on year; clothing up by 0.5%; housing up by 1.4%; articles and services for daily use up by 0.6%; transportation and communication up by 5.5%; education, culture, and recreation up by 2.6%; medical services and health care up by 0.6%; and other articles and services up by 0.7%. In terms of food, tobacco, and alcohol prices, the price of grain went up by 1.7%, fresh fruit up by 6.9%, fresh vegetables up by 3.7%, and pork down by 41.8%. The core CPI, excluding the price of food and energy, grew by 1.2% over that of the previous year. In March, the consumer price index went up by 1.5% year on year, 0.6 percentage points faster than that of February, and maintained the same level month on month.
In the first quarter, producer prices for industrial products went up by 8.7% year on year. Specifically, the prices in March went up by 8.3% year on year, 0.5 percentage points lower than the growth in February, or up by 1.1% month on month. In the first quarter, the purchasing prices for industrial producers went up by 11.3%. Specifically, the prices in March went up by 10.7% year on year, 0.5 percentage points lower compared with the growth in February, or up by 1.3% month on month.
Eighth, newly increased employment in urban areas expanded, and surveyed unemployment rate increased.
In the first quarter, the newly increased employed people in urban areas numbered 2.85 million, and the urban surveyed unemployment rate averaged 5.5%. In March, the urban surveyed unemployment rate was 5.8%, 0.3 percentage points higher compared with that in February. The surveyed unemployment rate of the population with local household registration was 5.6%, and that of the population with non-local household registration was 6.3%, among which the rate of the population with non-local agricultural household registration was 5.9%. Specifically, the surveyed unemployment rates of the population aged from 16 to 24 and from 25 to 59 were 16.0% and 5.2%, respectively. The urban surveyed unemployment rate in 31 major cities was 6%. The employees of enterprises worked 47.3 hours per week on average. At the end of the first quarter, the number of migrant workers who left their hometowns and worked in other places totaled 177.8million.
Ninth, residents' income increased stably and urban-rural per capita income ratio narrowed.
In the first quarter, the nationwide per capita disposable income of residents was 10,345 yuan with nominal growth of 6.3% year on year, or a real growth of 5.1% after deducting price factors. In terms of permanent residence, the per capita disposable income of urban households was 13,832 yuan with nominal growth of 5.4% year on year and real growth of 4.2%; the per capita disposable income of rural households was 5,778 yuan with nominal growth of 7.0% year on year and real growth of 6.3%. In terms of income source, the nationwide per capita salary income, net operative income, net property income, and net income from transfers saw a growth of 6.6%, 5.4%, 6.1%, and 6.3% in nominal terms, respectively. The per capita disposable income of urban households was 2.39 times that of rural households, 0.04 less than the ratio of the same period last year. The median of nationwide per capita disposable income of residents was 8,504 yuan with nominal growth of 6.1% year on year.
Generally speaking, the national economy in the first quarter continued the momentum of recovery, performing within the reasonable range. However, we must be aware that with the domestic and international environment becoming increasingly complicated and uncertain, economic development is facing significant difficulties and challenges. In the next stage, we must follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and fully implement the guiding principles of the Central Economic Work Conference and the arrangements made by the government work report. We must coordinate the COVID-19 response and economic and social development, make economic stability our top priority, and pursue progress while maintaining stability, ensuring stable growth in an even more prominent position. We must further strengthen the implementation of macro policies, take solid steps to ensure stability on six key fronts (employment, the financial sector, foreign trade, foreign investment, domestic investment, and expectations) and security in six key areas (job security, basic living needs, operations of market entities, food, and energy security, stable industrial and supply chains, and the normal functioning of primary level governments), focus on maintaining stable macroeconomic performance, continue to stabilize employment and prices, ensure basic living needs are met, and keep the economy performing within an appropriate range.
Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
Thank you for your introduction, Mr. Fu. Let's move on to the question-and-answer session. Please identify the media outlet you represent before asking a question.
CNR:
According to the newly-released major economic indicators for the first quarter, industrial production has maintained rapid growth. What are the reasons? What are your expectations for its performance in the days to come? Thank you.
Fu Linghui:
Thanks for your questions. Industrial production has maintained stable overall this year due to the policies and measures to promote a stable performance of the industrial sector. As a result, the total value-added of industrial enterprises above the designated size grew by 6.5% year-on-year in the first quarter, higher than that of the fourth quarter of last year, and it has maintained rapid growth. Such rapid growth in industrial production results from economic recovery both domestically and globally, and it is also due to industrial innovation as an enhanced driving force and industrial upgrading as a continued driver. Moreover, ramped-up efforts to ensure market supply and rapid growth in relevant sectors have also contributed.
First, the industrial upgrading has been outstanding as a driving force. Market demand for medium- and high-end products has increased due to the changes in our stage of development. Moreover, industrial upgrading has been accelerated thanks to the effective implementation of the innovation-driven development strategy. As a result, the equipment manufacturing industry has seen sound development, and the high-tech manufacturing sector has witnessed rapid growth, greatly supporting the development of the industrial sector. The value-added of the equipment manufacturing industry increased by 8.1% year-on-year in the first quarter. Among these, the value-added of the electrical machinery and equipment manufacturing sector and the electronic equipment manufacturing sector, such as computers and telecommunications, increased by more than 10%, boosting the value-added growth of industrial enterprises above the designated size by around 1.7 percentage points. The value-added of the high-tech manufacturing industry increased by 14.2% year-on-year in the first quarter, which is also markedly higher than the overall growth of the industrial enterprises above the designated size.
Second, the output of the consumer goods manufacturing industry has increased. Given the sustained economic recovery, people's demand for consumer goods has grown, leading to growth in the relevant manufacturing sector. The value-added of the consumer goods manufacturing sector climbed 8.1% year-on-year in the first quarter, along with that of the agricultural and sideline food processing sector, the food manufacturing sector, as well as the sector of wine, beverage, and refined tea manufacturing, and the sector of the pharmaceutical manufacturing rising 6.4%, 6%, 12.1%, and 11.8%, respectively. These four sectors have boosted the value-added growth of industrial enterprises above the designated size by around 1 percentage point.
Third, the exports of industrial products have witnessed rapid growth. China has a complete industrial system with strong industrial supporting capability, facilitating it to adapt to changes in global market demands quickly. The increased demand for our industrial products exports to the international market has boosted China's industrial output. The export delivery value of the industrial products climbed 14.4% year-on-year in the first quarter, maintaining rapid growth. The auto manufacturing sector and the specialized equipment manufacturing sector both rose by more than 20%.
Fourth, the production of the coal and power industries has seen an increase. We have stepped up efforts to ensure the supply of energy and raw materials. Thereby the output of the relevant sectors has witnessed rapid growth. The value-added of the mining sector increased by 10.7% year-on-year in the first quarter, with that of the coal mining and dressing sector climbing 13.2%. Moreover, the sector of production and supply of electricity and thermal power and the gas production and supply sector has also maintained rapid growth. According to preliminary calculations, the increase in the sectors regarding mining, electricity, thermal power, and gas has boosted the growth of industrial added value above designated size by around 1.4 percentage points.
Moreover, those measures and policies to help enterprises alleviate their difficulties have also played a positive role in stabilizing the industrial output. In the first quarter, enterprises' satisfaction with the preferential policies rose 2.7 percentage points compared with the fourth quarter of 2021, with their satisfaction with the tax and fee reduction policy surpassing 85%, according to the results of a survey of nearly 110,000 industrial enterprises above the designated size nationwide.
However, the growth of the production of the industrial enterprises above the designated size slowed down in March due to the growing impact of the pandemic, with their difficulties in production and operation being increased. Given the new situation and changes, we need to take the challenges seriously, and adopt proactive measures to address them. We should also bolster confidence, as the industrial production is generally stable with solid resilience, capable of withstanding the pressure, and maintaining stable performance.
Going forward, we will ensure the implementation of the support policies to promote industrial economic development. We will step up efforts to support the manufacturing sector and micro and small enterprises, and increase the support for those enterprises severely affected by the pandemic. We will also ensure the supply of energy and raw materials, stabilize the prices, maintain the stability of industrial and supply chains, and promote the stable and healthy development of the industrial sector. Thank you.
_ueditor_page_break_tag_China Daily:
Recently, due to the complex international environment and the sporadic COVID-19 outbreaks in China, the country's economy is also facing greater pressure. What do you think about this? In addition, what were the characteristics of the economic performance in the first quarter? What's your comment on this? Thank you.
Fu Linghui:
Thanks for your questions. China's economy has attracted much attention, especially the economic performance in the first quarter. Since the beginning of this year, the international situation has become more complex and severe, and the country has seen multiple, sporadic COVID-19 outbreaks at home, which have made greater impact on economic performance. Faced with the complex situation, all localities and government departments have thoroughly implemented the decisions and plans of the CPC Central Committee and the State Council, insisted on seeking progress while maintaining stability, focused on stabilizing the macroeconomic market, and effectively responded to risks and challenges. The national economy continued to recover, and got off to a steady start. This was mainly reflected in the following aspects.
First, the main macro indicators remained within a reasonable range. From the perspective of growth, the economy continues to maintain a momentum of expansion. In the first quarter, the GDP increased 4.8% year on year, 0.8 percentage point higher than that in the fourth quarter of the previous year, and the month-on-month growth rate was 1.3%. In terms of employment, despite the impact of the pandemic, the country's surveyed unemployment rate in urban areas increased in March, but in general, the overall stable employment situation has not changed. In the first quarter, the national urban surveyed unemployment rate stood at 5.5%, basically the same as the first quarter of last year. In terms of commodity prices, the supply of goods and services in the market was generally sufficient, and consumer prices rose moderately. In the first quarter, consumer prices rose 1.1% year on year. In terms of the balance of payments, the trade surplus in goods expanded, the trade deficit in services narrowed, foreign exchange reserves remained stable at around $3.2 trillion, and the balance of payments remained stable.
Second, industrial and agricultural production was generally stable. Spring plowing and preparation for plowing were carried out in an orderly manner, and animal husbandry production grew steadily. The agricultural situation remained steady. In the first quarter, the added value of agriculture, forestry, animal husbandry, and fishery industries increased 6.1% year on year, the meat output including pork, beef, lamb and poultry increased 8.8%, and the industrial production grew rapidly. In the first quarter, the added value of industrial enterprises above designated size increased 6.5% year on year, among which the equipment manufacturing industry saw a year-on-year growth of 8.1%.
Third, the trend of innovative development continued. New industries continue to grow. In the first quarter, the added value of the high-tech manufacturing industry increased 14.2% year on year, and the added value of the information transmission, software, and information technology service industry increased 10.8%, both maintaining rapid growth. New business forms and models continued to grow strong. In the first quarter, the online retail sales of physical goods increased 8.8% year on year, maintaining growth from an already high number and accounting for 23.2% of the total retail sales of consumer goods.
Fourth, the economic structure has been adjusted and optimized. The proportion of the manufacturing industry continued to increase. In the first quarter, the added value of the manufacturing industry increased 6.1% year on year. It accounted for 28.9% of the GDP, 1.3 percentage points higher than the same period last year. The leading role of consumption is obvious. In the first quarter, the contribution rate of final consumption expenditure to economic growth was 69.4%, an increase of 18.7 percentage points over the same period last year and higher than the contribution rate of gross capital formation. The income ratio of urban and rural residents declined. In the first quarter, the per capita disposable income ratio of urban and rural residents was 2.39, down 0.04 from the same period of last year.
Fifth, green transformation kept steadily advancing. Green and low-carbon products grew rapidly. In the first quarter, the output of new energy vehicles and solar cells increased 140.8% and 24.3%, respectively. The proportion of clean energy consumption continued to rise. In the first quarter, the proportion of clean energy consumption, such as electricity generated by natural gas, water, nuclear, wind, and photovoltaics, increased 0.8 percentage point over the same period of the previous year. Energy consumption per unit of GDP continued to decline. In the first quarter, energy consumption per 10,000 yuan of GDP dropped 2.3% year on year.
Sixth, people's livelihood kept improving, and residents' income continued to grow. In the first quarter, the country's per capita disposable income increased 5.1% year on year in real terms. Specifically, the per capita disposable income of rural residents increased 6.3% in real terms, and the per capita disposable income of urban residents increased 4.2% in real terms. The income growth of rural residents continued to be faster than that of urban residents, and the basic living consumption of residents was guaranteed. In the first quarter, the added value of the consumer goods manufacturing industry increased 8.1% year on year, maintaining relatively rapid growth. The retail sales of commodities in grain, oil and food, and beverage commodities by enterprises above designated size increased 9.3% and 11.8%, respectively. Investment in the people's livelihood sector continued to increase. In the first quarter, investment in education and health increased 17.2% and 23.8%, respectively.
I want to point out that the global situation has become more complex since March. As the impact of the domestic epidemic continues, some unexpected factors have exceeded expectations. Some major indicators have seen slower increases, and the downward economic pressure has increased. However, the fundamentals of China's long-term positive economic growth have not changed, the continuous recovery of the economy has not changed, nor have the characteristics of great potential, sufficient resilience, and broad space in development. China is fully capable and well-placed to overcome difficulties and challenges and achieve sustainable and healthy economic development.
In the next stage, we will fully implement the spirit of the Central Economic Work Conference and the deployment of the government work report and scientifically coordinate epidemic prevention and control and economic and social development. We will make economic stability our top priority and seek progress while maintaining stability. We will put the steady growth in a more prominent position, intensify the execution of macro policies, pay close attention to the implementation of policies, and strive for early implementation and early results. We will effectively deal with prominent problems, stabilize the fundamentals of the economy, safeguard basic people's livelihood, keep the economy operating within a reasonable range, and continue to make new progress in promoting high-quality economic development.
Thank you.
_ueditor_page_break_tag_CNBC:
I have two questions. The first is about employment. The newly added jobs in the first quarter were fewer than in the same period last year. Have you analyzed the reasons behind the decrease? Can you introduce the employment prospects for people aged above 35? My second question is about production. Considering the recent epidemic prevention and control measures, some businesses owners are worried that their businesses could be affected if production does not resume in May. What is your evaluation of the impact of halting production on the economy? Thank you.
Fu Linghui:
Thank you for your questions. Your questions are mainly about employment and the impact of epidemic on production. Since the beginning of this year, the international landscape continues to face grave challenges, while domestically, the impact of the epidemic still persists. Both have resulted in rising pressure on employment. Against this backdrop, the employment-first policy continues to produce effects, and the efforts for easing businesses' difficulties have been intensifying. Overall employment therefore remains stable. In the first quarter, the average surveyed urban unemployment rate stood at 5.5%, 0.1 percentage point higher than the same period last year. The unemployment rate among those aged between 25 and 59, the majority of the labor market, stood at 4.9%, unchanged from the same period last year.
While analyzing monthly trends, the surveyed urban unemployment rate rose in January and February, mainly because more people wanted to seek new jobs around the Chinese New Year. Based on our past experience, as those jobseekers would usually find new positions around March, the surveyed urban unemployment rate would gradually fall. However, the epidemic resurgence since March of this year has posed challenges for some jobseekers, stopping them from participating in job fairs. Therefore, the surveyed urban unemployment rate continued to rise in March to 5.8%, 0.3 percentage point higher than that in February. This reflected the increasing difficulty in production and business operations as well as mounting pressure on employment.
Although faced with difficulties, China still has many favorable conditions for stabilizing employment. Policies and measures to coordinate epidemic control and economic and social development will continue to produce effects, and the adverse impacts of the epidemic will be gradually brought under control. This year, the Chinese government will further the scale of tax-and-fee reductions and provide more effective support to the real economy so as to help ease the difficulties of businesses and ensure job opportunities. The robust environment for starting businesses and engaging in innovation is conducive to increasing jobs. Meanwhile, we have provided better vocational skills training and improved policies for employment support to facilitate supply-demand matching in the job market.
In the next stage, we will make full use of those favorable conditions to coordinate epidemic prevention and control with economic and social development. We will strive to maintain stable employment by strengthening the employment-first policy, easing the burdens of businesses to stabilize and expand employment, keeping the operations of market entities stable, and maintaining job security. We'll do this especially by improving policies on employment support for key groups such as college graduates and rural migrant workers.
As for the second question regarding the impact of the epidemic on production, since the beginning of this year, and March in particular, due to the COVID-19 resurgence in some areas, face-to-face sectors, especially the face-to-face service sector, have faced grave challenges. Consumption in catering, hospitality, retail, transport, and tourism has declined, which has had a negative influence on the production of the sectors involved. In areas with more severe epidemic situations, enterprises have reduced or even halted production. Fettered transport and logistics services also impeded industrial production. Despite those problems and pressure, we must see that there are favorable conditions for the Chinese economy to continue to recover.
First, the country's economy enjoys strong resilience, and the fundamentals sustaining its long-term economic growth remain unchanged, as does its economic recovery trajectory. China has a full-fledged industrial system, ever-improving infrastructure, and a super-sized domestic market. Efforts to promote innovation-driven development are paying off. All of these have laid a sound foundation for promoting sustained and healthy economic growth.
Second, the country has the requisite conditions to contain the epidemic in a scientific manner. Since the epidemic outbreak, China has conducted science-based and targeted prevention and control and developed a string of effective measures which agree with the actual conditions to ensure overall economic and social stability. Since the beginning of this year, the transmission of coronavirus has demonstrated new traits. However, as long as we stick to science-based prevention and control, we will gradually halt the spread of the epidemic and lower the negative impact of the epidemic on economic and social development.
Third, the country has rolled out a series of supportive policies. Since the beginning of this year, all local authorities and government departments have made economic stability our top priority, pursuing progress while ensuring stability and proactively introducing pro-stability policies. We will take further steps to cut taxes and fees, and tax and fee reductions this year are expected to reach 2.5 trillion yuan. In the face of the complex situation, we will further strengthen macro policies and encourage the financial sector to provide more effective support to the real economy. The People's Bank of China recently announced it would lower required reserve ratios to reduce financing costs of businesses, which will help enterprises resolve difficulties and promote stable economic performance.
In the next stage, we will continue to promote economic recovery by responding to the COVID-19 epidemic and pursuing economic and social development in a well-coordinated way. We will put into effect all measures for routine epidemic prevention and control and ensure that policies that have been introduced are implemented and deliver results at an early date. We will continue to expand domestic demand, help enterprises ease their difficulties, and ensure people's basic living needs. Thank you.
_ueditor_page_break_tag_Hong Kong Bauhinia Magazine:
Since the start of this year, global commodity prices have stayed firm. What does the NBS predict for the trend of this year's commodity prices? Thank you.
Fu Linghui:
Thanks for your question. Since the start of this year, the international situation has been undergoing multiple changes, and global commodity prices have soared to a new high. According to the statistics of the World Bank, in March, the global energy price index rose 24.1% month-on-month, and the non-energy price index increased 8.1% month-on-month, resulting in the general index reaching a new high in recent years.
Global commodity prices may remain high in the next stage and are prone to fluctuations. From the point of supply, Russia is a major country exporting energy, grains, and chemical fertilizers, while Ukraine's corn and wheat export account for a larger global share. The geopolitical conflict between Russia and Ukraine will lead to a decline in the output of related products and an increase in export controls, which will affect the global commodity supply. From the perspective of demand, the sustained recovery of the global economy will support the growth of commodity demand. However, amid expectations of a supply shortage, the hoarding demand of some commodity importers has increased, exacerbating the imbalance between supply and demand. Meanwhile, the geopolitical conflict has led to the sanction and anti-sanction practices between some countries and affected the efficiency of the global supply chain. Due to these factors, commodities' transportation and transaction costs have increased, putting further upward pressure on prices.
Therefore, against the backdrop of a tightening supply-demand relationship and increasing uncertainties in the global commodity market, high prices prone to fluctuations will be more likely to be witnessed.
Thank you.
_ueditor_page_break_tag_Bloomberg:
My question is about industrial output. Crude steel output in the first quarter fell 10.5%, cement fell 12.1%, and yet fixed asset investment (FAI) rose 9.3%. How do you explain the difference, or the massive divergence, between the collapse in industrial output for these products that are used for investment but the continued rise in investment? Thank you.
Fu Linghui:
Thank you for your question. More attention has been paid to the date this year. In general, with the development of China's economy in recent years, which is changing to high-quality development from the high-speed growth, we can see new changes in the driving force of economic growth compared with the past. In industrial production, we have seen that high-tech manufacturing and equipment manufacturing have maintained rapid growth, offering increased support for industry . In industrial investment, high-tech and equipment manufacturing investment has also maintained rapid growth. Therefore, the mode driving economic growth through industrialization and urbanization has changed dramatically compared with the past. You just mentioned that the output of crude steel and cement has dropped. However, industrial production has maintained rapid growth mainly due to the change of driving force of economic development. Now, the industrial sector is moving towards medium and high-end in the value chain. This year, among the three major investment areas, the manufacturing investment has seen a rapid increase, significantly driving the development of traditional industrial products, such as steel and cement. We should treat it objectively and conduct conscientious analyses to draw an accurate conclusion about such an economic phenomenon. Thank you.
_ueditor_page_break_tag_The Paper:
Recently, the social life and economy of Shanghai and other Chinese regions have been impacted by the COVID-19 pandemic. How does the NBS view this impact? Will it diminish China's possibility of achieving its economic growth target this year? Thank you.
Fu Linghui:
Thanks for your questions. Since the beginning of this year, the world has been suffering from disturbances; the COVID-19 pandemic has continued to sprawl, and geopolitical conflicts have worsened, adding to instability and uncertainty in China's external environment. Domestically, the pandemic has arisen sporadically, and some emergency factors have gone beyond our expectations. All these have compounded the downward pressure on the Chinese economy. However, despite all these unfavorable factors, under the strong leadership of the CPC Central Committee, all localities and departments in China, following a principle of upholding stability as the top priority and pursuing progress on the basis of ensuring stability, have adopted a scientific approach to coordinate pandemic control and social development, intensified efforts to stabilize economic growth, and managed to keep the economy operating within a reasonable range on the whole.
In terms of the next stage's economic trend, though pressure will continue to exist in the short run, China still has many favorable conditions for sustaining steady growth for the whole year.
First, consumption is expected to maintain its recovery momentum. Though the recent pandemic resurgence has restrained consumption growth, recovery momentum will not change, and consumption will still demonstrate its role as the ballast of the Chinese economy. In the first quarter, final consumption contributed 69.4% to China's GDP, still the highest among the three major economic drivers of consumption, investment and exports. As China gradually reins in the impact of the pandemic over time and the employment-first policy continues to pay off, the consumption power and desire of the Chinese people are bound to increase. Meanwhile, China will take other measures to sustain consumption growth, including efforts to promote spending on new energy vehicles, green and smart home appliances, and other big-ticket items. We will also facilitate in-depth integration of online and offline consumption, foster new forms and models of consumer spending, and upgrade and expand the rural consumer market.
Second, the role of investment as a growth driver is expected to grow. Since the beginning of this year, all localities have actively pushed ahead with the construction of major projects, thus stimulating rapid investment growth. In the first quarter, manufacturing investment grew 15.6% year on year, and infrastructure investment by 8.5%. As China continues to scale up support for the real economy and upgrade its traditional industries, and emerging industries continue to gather momentum for innovative development, more favorable conditions will be created for industrial investment growth. Meanwhile, the efforts to make infrastructure investments in an appropriately forward-looking manner centering on China's major strategic initiatives and the 14th Five-Year Plan will also drive investment growth.
Third, industrial upgrading has picked up pace. In recent years, China has taken a slew of measures to promote industrial upgrading, including efforts to further implement its innovation-driven development strategy, grow its strategic scientific and technological strength, enhance its capacity for scientific and technological innovation, beef up incentives for corporate innovation, and raise the proportion of R&D expenses for additional tax deductions. The results of these measures have continued to show. In the first quarter, the added value of high-tech manufacturing expanded by 14.2% year on year, and equipment manufacturing 8.1%, signifying a steady rise in the application of industrial technologies.
Fourth, green and intelligent transformation has become a stronger growth driver. As China makes steady progress in green development, the transition toward green and low-carbon energy accelerates, the demand for new energy products expands, and the requirement for conventional industries to conserve energy and reduce carbon emissions increases, helping to boost the growth of related industries. In the first quarter, the output of new energy vehicles and solar cells increased by 140.8% and 24.3% year on year, respectively. The rapid growth in 5G networks, information technology, and artificial intelligence have also given birth to new sources of industrial growth. In the first quarter, the manufacturing of intelligent consumer equipment grew by 10% year on year.
Fifth, opening up continues to pay dividends. In spite of complicated and challenging international circumstances, the world economy is still recovering on the whole, and demand for China's exports will continue to grow. In the face of the pandemic, Chinese export enterprises have shown strong adaptability to the changes in external demand. Meanwhile, China's policies to stabilize foreign trade have continued to work, the Belt and Road Initiative has continued to deliver benefits, and new forms of business for foreign trade have developed rapidly, all creating favorable conditions for foreign trade growth. In the first quarter, China's imports and exports expanded by 10.7% from a high base last year, showing the resilience of the foreign trade.
Sixth, China's macro-economic policies have continued to pay off. Since the beginning of this year, in the face of the complex situation, all localities and departments have implemented the spirit of the Central Economic Work Conference and the deployments of the government work report. Following the principle of upholding stability as the top priority and pursuing progress while ensuring stability, they have adopted policies to ensure economic stability and increased support for the real economy. China will continue to increase market supply to stabilize prices. In response to the mounting economic downward pressure recently in particular, China will further intensify the implementation of macro policies with early and paced-up arrangements to support market entities, guarantee grain and energy security, maintain the stability of the industrial and supply chains, and meet basic living needs. The policies, as their effects gradually show, will promote steady economic performance.
In general, our country is able to effectively handle all risks and challenges with a complete industrial system, large market scale and broad market space, ample benefits of reform and opening up, and strong economic governance ability. Throughout 2022, the national economy is expected to maintain recovery and development. Certainly, we should pay much attention to the problems we face. According to the decisions and arrangements of the CPC Central Committee and the State Council, we will continue to conduct pandemic prevention and control and pursue economic and social development in a well-coordinated way, enhance the implementation of macro policies, stabilize the macro-economy, and strive to accomplish this year's projected targets and tasks.
Thank you.
_ueditor_page_break_tag_Cover News:
As of this year, sales in the real estate sector have declined, but the real estate investment has registered a certain amount of growth. What is your opinion on that? What do you expect the future real estate market to look like? Thank you.
Fu Linghui:
Thank you for your questions. People are concerned about the real estate market, and there has been much discussion on the recent changes of real estate indexes. According to historical records, in general, the growth of real estate investment is directly proportional to that of sales in commercial buildings, but the change in growth of real estate investment is markedly less than that of the commercial building sales. That is because once the construction of a real estate project begins, real estate companies continue construction to ensure they get their money back from the project's sales, and thus real estate investment is more stable than the sales. Therefore, even though market sales are sluggish and declining, it is still possible for real estate investment to maintain certain growth, as was the case in 2012, 2014, and 2015.
In the first quarter of 2022, the investment in real estate development increased by 0.7% year on year, but sales of commercial buildings by floor area declined by 13.8%, and sales volume by 22.7%. Therefore, real estate investment continued to increase while sales decreased. That was mainly due to the following reasons.
First, the effect of relevant policies, such as ensuring delivery. Since the end of 2021, all regions have stuck to the policy of “ensuring delivery, people's basic living needs, and stability,” promoted the resumption of real estate projects previously halted or delayed, and advanced the construction of ongoing projects. In the first quarter, real estate projects with a construction period lasting more than one year saw a rate of investment growth exceeding 10%. With the advancement of real estate projects, in the first quarter, investment in building installation projects in real estate development grew by 0.9% year on year, driving the growth of real estate investment by more than a 0.5 percentage point.
Second, the impact of counting in land purchase expenses. Earlier land purchase expenses are gradually counted into the investment of real estate development while construction of real estate projects advances, which partly accounts for the growth of real estate investment. In the first quarter, land purchase expenses grew by 0.6% year on year, increasing the real estate development investment by more than a 0.1 percentage point.
We should also notice that although the sales of real estate dropped, the sales volume of real estate still exceeded the total investment in the real estate market, and so sales could still support the investment to some extent. Meanwhile, the growth of real estate investment was influenced by prices. Since 2022, prices of construction materials and project installation fees have increased substantially, which drove the nominal increase in the real estate investment to some extent.
As for the real estate sector's prospects, though real estate sales are declining, as many regions moderately release restrictions on house purchases, lower thresholds for using housing funds, and accelerate approvals of loans for purchasing houses, the housing demands of some cities are released, and the decline of sales by floor area slows.
Going forward, all regions will stick to the principle that houses are for living in, not for speculation, and continue to stabilize land prices, housing prices, and expectations. The long-term mechanism of the real estate market will be improved to meet reasonable housing demands, and the declining sales of commercial buildings in China is likely to be moderated. With the improvement of the long-term rental market and the accelerated development of government-subsidized housing, the real estate market is expected to be gradually stabilized. Thank you.
_ueditor_page_break_tag_Hong Kong Economic Herald:
We recently noted that the Guideline of the CPC Central Committee and the State Council on Accelerating the Establishment of a Unified Domestic Market was released. How should we understand the unified domestic market? In what aspects shall we build the market? Thanks.
Fu Linghui:
Thank you for your questions. The Guideline of the CPC Central Committee and the State Council on Accelerating the Establishment of a Unified Domestic Market was officially released. The guideline stipulates the acceleration of the development of mechanisms and rules for the unified national market, the breaking of local protectionism and market division, and the unblocking of key sticking points restricting economic circulation in order to promote the smooth movement of commercial goods as a production factor in a larger scale. It also stipulates that we should speed up the construction of an efficient and standardized unified domestic market featuring fair competition and sufficient opening-up, and comprehensively advance our domestic market to transform from growing bigger to stronger in a bid to provide a solid support for building a high-standard market system and a high-standard socialist market economy. All these will promote the improvement of relevant systems and advance high-quality economic development.
First, the building of a unified domestic market is the shoring of the foundation and internal requirement of fostering the new development pattern. As China's economy has entered a high-quality development stage, in the face of the profound and complex changes in the international environment and the unbalanced and inadequate development inside of China, in order to realize the sustainable and sound economic growth, we have to implement the new development philosophy and accelerate the fostering of a double development dynamic, with the domestic economy and international engagement reinforcing each other, and the former as the mainstay. To promote the development of the domestic economy is inseparable from the building and improving of a unified domestic market. Only by accelerating the building of an efficient and normative unified domestic market can we promote the smooth flow of factors and resources and make the domestic economy more dynamic.
Second, the building of a unified domestic market is conducive to creating a stable, fair, transparent, and predictable business environment. In recent years, China has deeply implemented reforms to streamline administration and delegate power, improve regulation, and upgrade services, as well as actively built a market-orientated, law-based, and internationalized business environment. These efforts have provided a sound ecology for various types of market entities to invest and foster businesses, increased the number of market entities, injected vitality into the market, promoted the employment, and accelerated the development. In the next step, with the building of a unified domestic market and further improvement of the fair, transparent, and predictable business environment, we will further stimulate the potential of entrepreneurship and innovation, create more high-quality jobs, and promote the emergence of new industries and models in a bid to inject strong vitality into China's development.
Third, the building of a unified domestic market is beneficial for promoting scientific and technological innovation and industrial upgrading. With a population of 1.4 billion, China has a distinctive advantage in utilizing its huge market. Building a unified domestic market, ensuring the decisive role of the market in resource allocation and allowing market demand to lead the efficient allocation of innovative resources and orderly flow and reasonable allocation of innovative factors, will encourage innovation, optimize the division of labor, promote competition, boost enterprises' willingness and capabilities to partake in scientific and technological innovation, promote the vigorous development of emerging industries, and encourage companies to go big. This is all in a bid to accelerate the reforms in quality, efficiency, and driving forces and provide strong support for China's high-quality economic development.
Meanwhile, the building of a unified domestic market will be helpful in further reducing market transaction costs and fostering new advantages in engaging with international competition and cooperation.
In the next step, we will earnestly implement the guideline on accelerating the establishment of a unified domestic market, which was jointly released by the Communist Party of China Central Committee and the State Council. We will strengthen the unification of basic market systems and rules, increase high-standard connectivity among market facilities, build a unified factor and resource market, promote high-standard unification between the commodity and service markets, advance fairness and unification in market regulation, and regulate inappropriate competition and acts of market intervention in a bid to accelerate the formation of a high-standard market system and promote sustainable and sound economic development.
Thank you.
_ueditor_page_break_tag_Reuters:
In the face of downward economic pressure, especially in April, as more cities have tightened anti-pandemic management and control while prices continue to increase, will there be rising stagflation risks? In addition, could you please provide the contribution statistics of the capital formation to as well as imports and exports to the economic growth in the first quarter? Thank you.
Fu Linghui:
I will answer the second question first. Regarding the contributions of the three key demands to economic growth, in the first quarter, the final consumption expenditure contributed 69.4% to GDP and added 3.3 percentage points to GDP growth; the capital formation contributed 26.9% to GDP and added 1.3 percentage points to GDP growth; net exports of goods and services contributed 3.7% to GDP and added 0.2 percentage points to GDP growth.
Regarding the issues of growth and prices that you are concerned about, I introduced the growth previously. Generally speaking, stable economic recovery and growth will be sustained. I would like to respond to the issue of prices. Since the beginning of this year, the price of global bulk commodities has continued to increase, enlarging its impact on our domestic prices. However, in general, China's strong market supply capacities for goods and services have laid a favorable foundation for stabilizing prices. Since the beginning of this year, consumer prices have increased modestly. In the first quarter, CPI increased by 1.1% compared with the same period of last year, slightly higher than that of the first two months. Meanwhile, core CPI increased by 1.2% on a yearly basis, flat with that of the first two months. The rise of CPI in March has slightly expanded as it increased by 1.5% compared with last March and 0.6 percentage points higher than that of February. Among this, the core CPI in March increased by 1.1% compared with last March, equal to that of February. Generally speaking, it demonstrates the following characteristics.
First, the year-on-year decrease of food prices has narrowed. In March, food prices decreased by 1.5% year on year, narrowing by 2.4 percentage points from the previous month's decrease. Among this, the price of pork fell by 41.4%, 1.1 percentage points lower than that of the previous month.
Second, the increase of industrial consumables has expanded. In March, the prices of industrial consumables increased by 3.5% year on year, 0.4 percentage points higher than that of the previous month.
Third, the increase in service prices has slightly decreased. In March, service prices increased by 1.1% year on year, 0.1 percentage points lower than that of the previous month.
The expanding growth rate of CPI in March is mainly attributed to the rising prices of vegetables and energy. Due to the pandemic and the weather, vegetable prices saw a year-on-year increase of 17.2% in March from a year-on-year decrease of 0.1% in the previous month. Domestic energy prices increased by 13.4% compared with the same period of last year, 1 percentage point higher than that of the previous month. The two factors added 1.32 percentage points to the growth of CPI, accounting for nearly 90% of the total increase of CPI.
Judging from the trend, despite the international imported factors and supply pressures of some fresh food in the short term, there are many favorable conditions for the CPI to maintain a moderate rise. In terms of demand, consumption and investment demand are still recovering, with limited influence on driving the price. From the perspective of supply, grain production has scored consecutive bumper harvests, and stocks are abundant; the production capacity of live pigs has generally recovered, the supply of pork is generally sufficient, and prices are still falling. This is because the supply capacity of China's commodity and service market is relatively sufficient. In March, the cost of industrial consumer goods excluding energy was relatively low; the price of services rose by 1.1% year-on-year, and the increase was a 0.1 percentage point lower than the previous month. Meanwhile, the measures to ensure market supply and stabilize prices will continue to be effective, which is also conducive to keeping prices stable. Therefore, there are foundations and conditions for prices to maintain a generally stable and moderate upward trend. Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
Due to limited time, the last question, please.
The Beijing News:
Since the beginning of this year, the global energy and food supply have been tight under the influence of the international situation. What is the current condition of energy production and agricultural production in China? Can we meet market needs in the next stage? Thank you.
Fu Linghui:
Thanks for your questions. The international situation has undergone significant changes this year, which have had a major impact on global food and energy production and supply. In general, domestic food production and energy supply are generally stable. In recent years, China has attached great importance to agricultural development. It has introduced a series of measures to encourage and support agricultural development, speed up the protection of cultivated land, promote the construction of high-standard farmland, give play to the role of agricultural technologies, and promote the increase of grain production and harvest. Positive results have been achieved as a result. China's grain production has been more than 1.3 trillion jin (650 billion kg) for seven consecutive years, and live pig production has also returned to the level of normal years.
This year, agricultural production has remained generally stable. In the first quarter, the added value of the primary industry increased by 6% year-on-year, maintaining rapid growth. Regarding the planting industry, the total output value increased by 4.8% in the first quarter. Affected by the severe flood last autumn, the winter wheat planting season in some areas was significantly prolonged. The winter wheat planting area was stable and slightly decreased, and the seedlings were weak. Since the spring of this year, the climate in the main winter wheat-producing regions has been generally favorable. All localities have stepped up efforts to do an excellent job in farmland management, and the seedling situation has gradually improved. At the same time, the northwest region is also actively expanding the planting area of spring wheat, and the total planting area of the wheat is basically the same. Regarding livestock farming, the production remained stable. In the first quarter, the total output value of livestock farming increased by 8% year-on-year, and the output of beef, mutton, and poultry increased by 8.8% compared with the same period of the previous year.
For the next stage, the stability of food production can be guaranteed.
First, we will see responsibilities are fulfilled by all stakeholders at all levels and ensure the equal responsibility of the Party and government for grain production. The production areas and output should be ensured in all main producing and marketing areas,, and areas with a balance between production and marketing. We will strengthen the management of arable land and ensure stable grain production.
Second, we will scale up support for food production. The minimum purchase price for rice and wheat will be increased, subsidies for corn and soybean producers and rice subsidies will continue to be stabilized, and a 20-billion-yuan subsidy for agricultural materials will be issued to mobilize farmers' enthusiasm for growing grain.
Third, we will improve planting efficiency. Since 2021, grain prices have remained stable and risen slightly, farmers' income from grain cultivation has increased, and their willingness to plant has increased. But, of course, we must also see that the cost of growing grain has risen, and there are uncertainties such as meteorological disasters, diseases, and insect pests. Therefore, we still need to do an excellent job in grain production to ensure food security.
Regarding energy, energy production has also remained generally stable this year. In the first quarter, the output of major energy products such as coal, gas, and electricity continued to grow, and China's energy supply was generally stable.
First, raw coal production maintained rapid growth. Coal production enterprises have thoroughly implemented the task of increasing coal production and ensuring supply, accelerating the release of high-quality coal production capacity, and effectively increasing coal supply. In the first quarter, the output of raw coal of industrial enterprises above the designated size reached 1.08 billion tons, a year-on-year increase of 10.3%.
Second, oil and gas production grew steadily. We have stepped up efforts in increasing storage and production capacity. In the first quarter, crude oil production of industrial enterprises above the designated size increased by 4.4% year-on-year, and natural gas production increased by 6.6% year-on-year.
Third, electricity production continued to grow. In the first quarter, power generated by industrial enterprises above the designated size increased by 3.1% year-on-year, of which clean energy power increased by 8.3% year-on-year, driving the growth of power production in industrial enterprises above the designated size by 2.1 percentage points.
Influenced by geopolitical conflicts, recently, the price of international energy commodities rose rapidly, the instability of the global energy market increased, and China's energy security is under certain pressure. Still, we have the conditions, capabilities, and methods to ensure a safe, reliable and stable supply of energy. Therefore, in the next stage, in accordance with the decisions and deployments of the Party Central Committee and the State Council, we will further implement the policies and measures that have been introduced to ensure energy supply and price stability, actively increase the supply of major energy products such as coal, oil, gas, and electricity, actively respond to the risks brought about by rising international energy prices, and resolutely meet basic living needs of people in energy consumption, and ensure the safe and stable supply of energy and the stable and healthy development of the economy and society. Thank you.
Shou Xiaoli:
Thank you, Mr. Fu, and friends from the press. That's all for today's press conference.
Translated and edited by Xu Xiaoxuan, Ma Yujia, Gong Yingchun, Liu Sitong, Zhang Rui, Wang Wei, Zhou Jing, Li Huiru, Yuan Fang, Liu Jianing, Qin Qi, Wang Yiming, Zhang Junmian, Wang Qian, Zhu Bochen, Yang Xi, Huang Shan, David Ball, Jay Birbeck and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Hao Chun, director general of the China Manned Space Agency
Yang Hong, academician of the Chinese Academy of Engineering, chief designer of the space station system of the China Manned Space Program (CMSP), and researcher at the China Academy of Space Technology
Huang Weifen, chief designer of the astronaut system of the CMSP and researcher at the China Astronaut Research and Training Center
Sun Jun, chief designer of the space station mission at the Beijing Aerospace Control Center
Zhong Hong'en, deputy chief designer of the space utilization system of the CMSP and researcher at the Technology and Engineering Center for Space Utilization of the Chinese Academy of Sciences
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
April 17, 2022
Shou Xiaoli:
Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Yesterday, Shenzhou-13's return capsule touched down safely, marking the complete success of the Shenzhou-13 manned mission. Today, we are delighted to have with us Mr. Hao Chun, director general of the China Manned Space Agency; Mr. Yang Hong, academician of the Chinese Academy of Engineering, chief designer of the space station system of the China Manned Space Program (CMSP) and researcher at the China Academy of Space Technology; Ms. Huang Weifen, chief designer of the astronaut system of the CMSP and researcher at the China Astronaut Research and Training Center; Mr. Sun Jun, chief designer of the space station mission at the Beijing Aerospace Control Center; and Mr. Zhong Hong'en, deputy chief designer of the space utilization system of the CMSP and researcher at the Technology and Engineering Center for Space Utilization of the Chinese Academy of Sciences. They will introduce China's progress on the construction of its space station and answer your questions.
Next, I will give the floor to Mr. Hao.
Hao Chun:
Ladies and gentlemen, friends from the media, good afternoon.
It is a great pleasure to meet you, and I would like to thank you for your attention and support of China's manned space program. Yesterday, Shenzhou-13's return capsule safely touched down at the Dongfeng landing site and the crew returned to Beijing in the afternoon. Entrusted by the general headquarters of the space station phased mission, today we will report to you about the Shenzhou-13 manned mission and the progress in the construction of China's space station and answer your questions.
First, let me briefly review the Shenzhou-13 mission: On Oct.16, 2021, the Shenzhou-13 manned spacecraft took off from the Jiuquan Satellite Launch Center, and later docked with the space station core module. After the docking, the three astronauts entered the core module and began their stay in space. During the mission, the crew took care of and maintained the facilities and equipment of the space station as planned, performed extravehicular activities (EVAs) twice, conducted a number of scientific and technological experiments, and carried out a series of science popularization and education activities such as two "Tiangong Class" lectures. The crew of Shenzhou-13 stayed at the space station for a total of 183 days, setting a record for the country's longest single-flight space mission. At present, the trio are in good health and are recovering following their return to Earth at the China Astronaut Research and Training Center.
The construction of China's space station includes two phases, which are the key technology verification phase and construction phase, respectively, with six missions planned for each phase. Among them, the main objectives of the key technology verification phase is to make breakthroughs in and comprehensively master key technology related to the construction and operation of the space station. Since 2020, we have successfully carried out six missions: the maiden flight of the Long March 5B launch vehicle, the launch of the space station's Tianhe core module, the Shenzhou-12 and Shenzhou-13 manned spacecrafts, and the Tianzhou-2 and Tianzhou-3 cargo spacecrafts. All of the missions achieved complete success and accomplished the mission objectives in the key technology verification phase, laying a solid foundation for the construction phase.
Since the 18th National Congress of the Communist Party of China (CPC), the CPC Central Committee with Comrade Xi Jinping at its core has paid great attention to the manned space program. General Secretary Xi Jinping has visited the mission site many times to take command and cordially met representatives of the space scientists and engineers who participated in the research and experiment. The general secretary also took part in a "space-Earth" talk with the crew. All members of the program have always kept in mind the care, trust and expectations of General Secretary Xi Jinping, and made every effort to tackle key problems, overcome the impact of COVID-19 on the development, experiments and flight missions, and achieved consecutive victories. The implementation of the mission has received strong support and full participation from relevant ministries and commissions of the central and local governments at all levels, as well as relevant forces. Here, on behalf of the mission headquarters, I would like to express my heartfelt thanks to all sectors of society for their concern and support, and journalists for their attention and reports.
According to the mission arrangements, we will complete the construction of the China's orbital space station in 2022. A total of six missions are planned, which are as follows: in May, the Tianzhou-4 cargo spacecraft will be launched; in June, the Shenzhou-14 manned spacecraft carrying three astronauts will be launched and the crew will also stay in orbit for six months; in July, the Wentian lab module will be launched, followed in October by the Mengtian lab module. The three modules of the space station will form a T-shaped space station. Then, we will launch the Tianzhou-5 cargo spacecraft and the Shenzhou-15 manned spacecraft. The crew of Shenzhou-15 will also be composed of three astronauts. These three astronauts will take over from their Shenzhou-14 predecessors, living and working in orbit for six months.
The year 2022 will mark the decisive victory of the construction of the space station and the 30th anniversary of the initiation and implementation of China's manned space program. The construction of China's space station and national space laboratory is an essential objective in the "three-step" development strategy and an important sign of the country's enhanced strengths in aerospace and science and technology in general. We deeply understand our glorious mission and great responsibility while embarking on a new journey in a new era. Throughout the program, we will firmly implement General Secretary Xi Jinping's instructions and requirements, be meticulous with the preparation, organization, and implementation, and ensure that all tasks are completed successfully, thus paving the way for a successful 20th CPC National Congress.
Now, we start taking questions. Thank you!
_ueditor_page_break_tag_Shou Xiaoli:
Now we entered the Q&A part. Please state the news outlets you work for before raising a question.
China Media Group:
Mr. Hao, the astronauts successfully returned yesterday, and this marked the successful completion of the key technologies verification phase for the space station project. Can you please shed light on the achievements we have accomplished and where we are on completing the set targets?
Hao Chun:
Thank you for your questions. We just mentioned that the main goal in the key technologies verification phase was to realize comprehensive breakthroughs of key technologies in the construction and operation of the space station. We think that comprehensive breakthroughs in relevant key technologies have been realized by implementing six missions. We have achieved many results through the six missions, which I will lay out.
First, we have achieved comprehensive breakthroughs in key technologies of space station construction. For example, astronauts' long-term in-orbit stays used to be one month at the longest, but now the living support and work support technologies allow them to remain in orbit for three months or six months. It makes a huge difference. These technologies have been thoroughly verified and reached a new level. Many other technologies, such as regenerative environmental control and life support, driving mechanisms for large-scale flexible solar arrays, transfer of modules aided by robot arms, and rendezvous and docking by remote control of astronauts, have seen breakthroughs, solving technological difficulties for future space station construction.
Second, we have improved organization and command system for conducting various missions. Since we started the space station project, the frequency of missions has stepped up, and five missions were conducted within six months last year, which posed new challenges for the organization and implementation of missions. To ensure successful organization and implementation of missions, we further improved the organization and command system. For example, we established the mechanism for emergency launching of manned spacecraft and the mechanism for astronauts' emergency return, and search and rescue. By improving the systems and mechanisms, we can ensure the efficient and smooth implementation of every launch to ensure the in-orbit safety of astronauts and the stable operation of the space station.
Third, the operation and management system for manned spaceflight with Chinese characteristics was initially established. Hugely different from the discontinuous launchings and short-term in-orbit operations in the past, spacecraft were in long-term continuous operations after entering the space station period. Astronauts worked and lived for longer terms while staying in orbit. These required the ground team to fully monitor and deal with emergencies throughout the whole process and in all states. To meet the new requirements, we explored and formulated a new flight-control model that combines centralized and distributed functions and developed a distributed system for ground control. They were put into use after the space station's core module was launched into orbit and have stood the tests during practical operations. A solid foundation has been built for long-term in-orbit space station operation and management in the future.
Fourth, high-level research results of space science and significant comprehensive benefits have been achieved. By utilizing experimental facilities for space science on the core module, we conducted scientific experiments, mainly containerless and high microgravity experiments, and accomplished many world-class achievements. We have insisted that the project's purpose is to serve the national economy and people's livelihoods, drive scientific and technological development, and boost comprehensive benefits. The manned missions of the Shenzhou series spacecraft carried a large number of seeds, including various characteristic plant seeds, experimental samples such as microorganisms and electronic components, and many experimental facilities and equipment for future development of aerospace technologies. We also carried out a series of science popularization and educational activities, including the "Tiangong classroom" space lecture activities, the exchange events that Chinese astronauts in space station Tiangong held a video chat with people in Beijing, Hong Kong and Macao, and a youth painting exhibition staged on the space station. We have reached rich results in both space science research and comprehensive benefits.
In general, in the space station's key technology verification phase, we have made comprehensive breakthroughs and mastered the key technologies of space station construction, and fully verified the functions and performance of various systems for follow-up missions, as well as the coordination and compatibility between systems. We have also tested the project's ability to implement missions on a frequent and regular basis, and accumulated rich experience in operation and management, laying a solid foundation for the construction of the space station. Thank you.
_ueditor_page_break_tag_Red Star News:
China's space station has a designed lifespan of 10 years. Ensuring the long lifespan of spaceflight products and their high reliability is a rigorous test for every system and even every component. The core module assembly of the space station has been in orbit for nearly a year. What is its current status? Has it reached its goal as expected? Among multiple eye-catching parts in the phase of verifying key technologies of the space station, the robot arm is the focus and the highlight. How do you evaluate its performance? Thank you.
Hao Chun:
The questions are of much concern to all of us. We'd like Mr. Yang Hong, the chief designer of the space station, to answer them.
Yang Hong:
Thank you for your questions. After the successful return of the Shenzhou-13 manned spacecraft, the assembly of the Tianhe core module and Tianzhou-3 cargo spacecraft are currently in orbit and in normal operation, with stable in-orbit operation parameters.
The core module has been in orbit for nearly a year, and all missions have been carried out smoothly as planned. We completed the rendezvous and docking with two manned spacecraft and two cargo spacecraft, as well as the three-month in-orbit stay of the Shenzhou-12 crew and the six-month stay of the Shenzhou-13 crew. We also carried out a number of special missions, including extravehicular activities, the test using the robotic arm to reposition cargo spacecraft, and manual remote operations.
During this period, we carried out a number of key technology verifications, mainly including physical and chemical regenerative life support, control of large complex, and large flexible solar panel wings and driving technologies. The evaluation results are in line with expectations, and the current functional performance is better than in the designs. Here are some examples: during the in-orbit stay of the Shenzhou-12 and Shenzhou-13 crews, the regenerative life support system of the Tianhe core module provided a good environment for astronauts to meet their material metabolism needs in orbit. The system collects the moisture discharged by the astronauts into condensed water and recycles and reprocesses urine into drinking water and electrolytic oxygen, making the water recycling efficiency higher than 95%, and the water utilization efficiency more than 83%, both meeting the requirements of the index. This technology greatly reduces astronauts' need for drinking water and oxygen to be carried by cargo spacecraft. As for the large flexible solar panel wings and their power supply technology, since the launch of the core module last year, they have been supplying power for the core module and its complex. The evaluation shows that their power generation capacity has reached around 10 kilowatts – far beyond the expected design. They have provided adequate power supply for power-consuming missions, including extravehicular activities, rendezvous and docking, and the test using the robotic arm to reposition cargo spacecraft.
Currently, we have successfully completed four extravehicular activities, covering the operations, installation, and maintenance of extravehicular electronics, machines, pipelines and other typical equipment. This proves that the whole spacewalk procedures and support systems, as well as space-ground collaboration meet the requirements, laying a solid foundation for astronauts to take care of, install and maintain the extravehicular facilities during the follow-up long-term operation period after the completion of the space station. At present, we are carrying out a capacity assessment to further tap the potential of the core module and make full and best use of it.
The robot arm played an important role during the whole key technology verification phase. It completed a number of key tasks, such as astronauts' extravehicular activities, transfer of cargo spacecraft, and extravehicular status inspection, with perfect performance throughout the whole process. Extravehicular operations by the robot arm prove its joint motion ability, terminal positioning accuracy and other functions meet design expectations. Its stiffness in operating loads indicates it is able to transfer large loads. We also obtained the kinematic model parameters of the robot arm while weightless in orbit. All of these have laid a solid foundation for future missions, such as using the robot arm to grab and transfer the lab modules and taking care of large extravehicular loads. In a word, we have completed the mission of the key technology verification phase for the core module of the space station and achieved expected goals. Thank you.
_ueditor_page_break_tag_Reuters:
I have two questions. My first question is, will the COVID-19 outbreaks in China this year delay the completion of the space station by the end of 2022. And my second question is, how much has China spent on building the space station so far, and how much does China expect to spend in the coming months? Thanks.
Hao Chun:
Since the outbreak of the COVID-19 pandemic in 2020, according to China's general arrangements, the whole project team has overcome many difficulties and taken many targeted and effective measures, and secured the support and coordination of relevant departments and local governments at all levels, so that we have managed to minimize the effect of the pandemic on the project. Currently, the research and the manufacturing of the project are proceeding as schedule, so the construction plan of the space station will not be delayed.
The investment in planning and implementing the space station project has been generally moderate and in line with economic and social development of our country. In general, China's manned space project has blazed a sustainable development path with Chinese characteristics suitable to China's national conditions, with lower input, fast development, and fruitful results.
Thank you.
_ueditor_page_break_tag_The Beijing News:
In manned spaceflight, the tracking, telemetry, and command and communication systems are likened to an invisible kite string. In the verification period of the space station's key technologies, the space station was larger and the system more complicated. How can we accurately track, telemeter, and guide the space station into the right orbit and ensure its secure and stable operation? Thank you.
Hao Chun:
Let's invite Mr. Sun to answer this question.
Sun Jun:
Thank you for your question. Over the past two years, our task mainly involved the assembly of the space station. Since last year, with the practice and technologies we gained during the five tasks of testing and verifying the key technologies needed for the construction of the space station, we have made breakthroughs in several flight control technologies, including its rapid rendezvous and docking modes, separation and returning, automatic task planning, complicated spacecraft accurate orbiting, forecasting, and robot arm remote control. We have developed a domestically constructed stable flight-control system platform as well as a set of systems for flight control management of the in-orbit space station with Chinese characteristics. It can be said that we have grasped and initially verified core flight control technologies in the assembly of the space station, which will provide a solid guarantee for the successful in-orbit assembly of the space station this year.
While pushing forward assembly and construction tasks, we have continued to improve the efficiency of the space station's in-orbit operation, optimize the space station's long-term organization and management model, and the support model for in-orbit astronauts. We have promoted automatic and intelligent technologies in the flight control system and expanded and improved the application and experiment models of space science so as to comprehensively enhance the in-orbit performance of the space station and give better play to the role of the large-scale space science experiment platform.
The Shenzhou-13 flight crew set a record in terms of the orbital stay of China's astronauts. In the future, Chinese space stations and astronauts will continue extended in-orbit flights. According to the planning of the project tasks and demands for science experiments, our center is in charge of the organization, arrangement, and implementation of the space station's long-term operation control. We have taken various measures to ensure the secure and stable in-orbit operation of the space station and the astronauts' health.
First, we constructed a complete ground verification system. We delicately designed the space station assembly plan and key flight control plans for in-orbit management. We made more than 3,000 fault pre-plans and constructed a full-loop ground verification environment that allowed communication among spacecraft, the tracking and command network, and the tracking and command center. We organized staff to conduct a full-course coordination rehearsal and comprehensively verified flight control plans, flight control systems, and performance in normal and emergent conditions so as to ensure the security and reliability of the flight control.
Second, we conducted strict organization and command. Following the principle of "unified command, professional support" in major and core control phases, we organized experts of all fields to provide professional and technical support on the flight control site. In the operation of the robot arm, extravehicular activities of astronauts, and other complex space science experiments, we arranged for multiple systems from space and the ground to coordinate and cooperate closely. We supervised, studied, and judged the situations with close attention, made decisions and arrangements on-site with science-based approaches in conducting major control tasks, and ensured the successful implementation of all tasks.
Third, precise monitoring and control. Beijing Aerospace Control Center deployed the land-sea-space telemetry, tracking and command network, mainly composed of relay satellites, to conduct large-scale measurement and control of the space station and effectively monitor the space station for each lap. In addition, we established an automated flight control system, which can conduct automatic planning and execution of in-orbit flight events, use the digital space station for auxiliary health management, conduct intelligent fault diagnosis, conduct regular check-ups for the space station to assess the overall health status, carry out timely and effective disposal of abnormal situations, and carry out regular emergency exercises such as the emergency evacuation of astronauts to hold the bottom line of safety firmly.
Fourth, we properly handled space security risks. We conducted full-time monitoring of space station equipment and the health status of astronauts, enhanced monitoring and early warning of the space environment and collisions of space objects, and took necessary avoidance measures. Since February this year, the space station's orbit has been released to the world for collision warning calculations by space entities around the world. I would like to express my heartfelt thanks to our foreign counterparts for building a harmonious and safe environment for China's space station. Thank you.
_ueditor_page_break_tag_Southern Metropolis Daily:
The six-month mission of the Shenzhou-13 crew has refreshed the record of flight duration of Chinese astronauts on a single task. What tests did the Shenzhou-13 crew survive during the mission? Are our targeted support systems in place? How about the physical condition of the three astronauts after their return? Thank you.
Hao Chun:
Let's invite Ms. Huang to answer your questions.
Huang Weifen:
Thanks for your questions. The Shenzhou-13 crew lived and worked in the space station for 183 days, completed various tasks, and set many records. For example, they carried out two extravehicular activities, gave two science lectures, conducted manual rendezvous and docking tests, and performed other more than 40 in-orbit experiments and tests in the fields of aerospace medicine, aerospace psychology, space ergonomics, and space material science as well as over 80 items of in-orbit data collection and analysis. In addition, the Shenzhou-13 crew also conducted a large number of inspection tests of the station assembly platform, equipment maintenance and care and management of materials and the space station, conducted health monitoring, in-orbit protection exercises, training, and drills, recorded a large number of science education videos, took a lot of photos and recorded a large number of videos, and obtained valuable and rich materials.
Generally speaking, the three astronauts maintained good physical and mental conditions during the mission. They cooperated very well, worked in a tight and orderly manner, lived a rich and colorful life, and successfully completed various tasks. They have stood the test of body and mind and the ability to accomplish tasks. They have returned to the Space City in Beijing and are carrying out recovery work as planned, and they are in good physical and mental condition.
The Shenzhou-13 crew spent six months in orbit for the first time, a new challenge for the China manned spacecraft program's astronaut system. According to the characteristics of the mission, on the one hand, the astronauts carried out targeted intensive training before their flight, including physical fitness training, psychological adjustment training, and intensive training involved in emergency handling ability and extravehicular activity. Personalized health protection measures were also improved. On the other hand, supporting measures for astronauts' stay in the space station were enhanced based on the Shenzhou-12 mission.
In terms of health protection, personalized in-orbit health protection measures have been improved, increasing the supply of relevant medicine and diagnostic and treatment equipment. Weightlessness protection exercise measures have been improved, increasing convenience and enjoyment. Personalized exercise regimens have been made to strengthen dynamic assessment and adjustment, enhance endurance and cardiovascular reserves, improve cardiopulmonary functions, strengthen exercises of core muscles such as back, neck, and lower limb strength, and promote the continuous improvement of gravity readjustment ability. The supply of fresh fruit and vegetables has been increased, and personalized electrolyte drinks have been provided to improve nutritional support. Methods of in-orbit psychological support were also diversified.
In terms of ensuring lives, in response to the more extended stay in the space station, the supply of food and water was increased, outfits were diversified, and the allocation of articles of daily use and hygiene supplies was optimized. In addition, according to the individual characteristics and needs, more in-orbit entertainment items were added.
In terms of work support, we have further standardized the astronaut in-orbit work system, work-rest schedule and duty system, and revised the astronaut flight manual, strengthening measures such as dynamic adjustment and update of flight plans and timely assessment. We have also optimized the EVA procedures, support mode and collaborative procedures to improve efficiency.
Generally speaking, the success of the Shenzhou-13 manned mission further confirms that China's astronaut selection and training techniques are scientific and effective, and that China is fully capable of providing support for astronauts' long-term in-orbit stays, which provides a foundation for follow-up missions and accumulates more abundant and valuable experience. Thank you.
_ueditor_page_break_tag_TASS:
China's space station has established cooperation with around 20 countries, including Russia. China expects to complete the building of its space station by the end of this year and to put it into operation next year. Will the international cooperation on the space station go smoothly amid the complex international situation? Will there be any obstacles or problems in this regard? What are your expectations or concerns? Thank you.
Hao Chun:
Exploring the unknown universe and developing space technology are a common cause of humanity, which requires the concerted effort of all nations. Throughout the development of manned spaceflight, international cooperation is also a historical trend that promotes continuous progress toward a higher level. China has been upholding the principles of peaceful utilization, equality, mutual benefits and shared development in its development of manned spaceflight. It has signed space cooperation agreements with many countries and international organizations, carried out a series of cooperation and exchanges, and implemented a range of cooperation programs, yielding fruitful research results. We will certainly keep acting under the guidance of the principles and carry out more in-depth exchanges and cooperation with countries committed to the use of outer space for peaceful purpose. We hope to make China's space station a platform which promotes the building of a community with shared future for mankind. We would like to work with astronauts and teams of space scientists all over the world to explore the vast universe and bring more benefits to humanity. Thank you.
_ueditor_page_break_tag_Phoenix Satellite Television:
Mr. Hao just mentioned that the Wentian and Mengtian lab modules will be sent into space later this year in July and November, and the in orbit construction of the space station will be finished then. How is work on the two lab modules currently progressing? What roles will they play in the future? Thank you.
Yang Hong:
Thank you for your questions. After the construction of the space station is completed, the two lab modules will become the central working area for astronauts in orbit. Astronauts can carry out intravehicular and extravehicular scientific and technological experiments in the two modules, both of which are equipped with experiment cabinets and an installation platform for extravehicular payloads, together with information support, as well as power supply and heat dissipation. In the two lab modules, astronauts will be able to conduct research into space science, space materials, space medicine and space exploration.
Next, let me briefly introduce the two lab modules. The Wentian lab module is equipped with the same living facilities as the Tianhe core module, including three sleeping areas, a toilet and a kitchen, ensuring the basic living requirements of astronauts. Wentian and Tianhe can support six astronauts living in space during the shift rotations of two spacecraft crews. A small mechanical arm is installed on the Wentian lab module. This can be used either alone or along with the larger robotic arm on the Tianhe core module to assist astronauts in tasks including EVAs, extravehicular facility maintenance and patrol inspections. Additionally, an airlock cabin in the Wentian lab module will serve as the main exit-entry point for EVAs once the construction of the space station is completed. The node cabin in the Tianhe core module will then serve as a backup. The Wentian lab module can also serve as a backup for the management and control of the space station complex in the case of a malfunction in the Tianhe core module, thereby increasing the overall reliability of the space station.
The Mengtian lab module is equipped with a cargo airlock cabin and a deployed extravehicular platform. In the future, the scientific equipment that needs to be installed outside the module will first be sent to the space station by cargo craft, then transferred outside through the cargo airlock cabin, and then installed on the extravehicular platform by mechanical arms or astronauts. In this way, the extravehicular research projects can be updated continuously.
So far, the development of the Wentian and Mengtian lab modules is going smoothly on the ground. The Wentian lab module has completed the entire module integrated assembly, testing, and large-scale experimental work in Tianjin, and is ready for launch. The Mengtian lab module has completed part of its integrated assembly and experimental work, and is currently undergoing on-the-ground testing. Further experimental work such as thermal testing of the entire module and return testing will be completed as planned. Thank you.
_ueditor_page_break_tag_Guangming Daily:
What achievements have been made to the space application system during the key technology verification phase of the space station? In addition, the Wentian and Mengtian lab modules will launch this year. What arrangements will be made for the space application system, and what achievements can be expected?
Zhong Hong'en:
Thank you for your questions. The core module has been operating in orbit for nearly one year, and the newly developed payloads of the space application system have been working stably and in good condition in orbit. The payloads are coordinated and matched with interfaces of relevant systems, and a large number of scientific experimental data and samples have been collected. We have made fruitful achievements mainly in the following aspects.
First, the scheme of the space-ground integrated system – a new-generation application mission – has been verified, including a globally advanced scheme that supports in-orbit sharing, a construction scheme of large-scale scientific research facilities, and a space-ground supporting scheme for low-latency broadband applications. These have laid a solid technical foundation for the in-orbit construction of application missions for the two lab modules.
Second, for the first time, China has in-orbit access to an advanced-communication-protocol-based optical fiber communication network. This highly reliable, wide-bandwidth network, with a large-capacity distributed storage system, is capable of computing at high speed in orbit. We have made breakthroughs in key technologies such as the globally advanced mechanical, electrical, and thermal integration of scientific experiment cabinets and created high-level supporting conditions for in-orbit application sharing.
Third, the container-free experiment cabinet has become China's first and the world's second research facility of its kind to work in orbit. Compared with other countries, this cabinet has higher-standard indicators and stronger capacities and has successfully completed experiments involving multiple material sample types and batches. Its heating temperature can reach above 2,000 degrees Celsius. It has discovered a variety of new phenomena and is undertaking in-depth scientific research on collected samples.
Fourth, for the first time, we have used our high-quality microgravity experiment cabinet to offset the influence of air disturbances and platform vibrations with air spray and magnetic levitation techniques. This achievement means that, with this cabinet, we can conduct microgravity experiments that are two to three orders higher in magnitude than that of the space station platform. We have achieved the world-leading microgravity level of 1E-7g for the first time and have the conditions to support and carry out frontier research such as those related to relativity theory and gravitational physics.
Fifth, for the first time, we have achieved telescience experiment ability, enabling the space-earth round-trip time with a delay of less than two seconds. We have established advanced digital twin models and a new experimental mode comparing objects with images, which has efficiently supported the in-orbit scientific experiments.
Next, the space application system will carry out in-depth container-free material science and high-quality microgravity experiments in accordance with its core module missions. We will successively complete the delivery, test launch, and in-orbit testing of the payloads of the two lab modules and complete the construction mission as planned.
A total of 14 high-level scientific experiment cabinets of the space application system have been installed inside the modules of the space station, with each cabinet serving as a miniature space lab. On the outside of the space station's modules, we have deployed three large payload hanging points and two experimental exposure platforms along with flagship research facilities such as the Xuntian space telescope, which will fly in the same orbit as the space station. All of these will support the development of nearly 100 research programs and thousands of scientific research projects in multiple fields, such as space life science, microgravity physics, and space astronomy, as well as earth sciences, new space technologies, and applications. Major discoveries are expected regarding fundamental and cutting-edge scientific issues such as the origin and evolution of the universe and celestial bodies, material structure, and the origin of life. Scientific breakthroughs can also be expected in key research directions such as basic physics, space life science, space materials science, microgravity fluid physics, and combustion science. All these will help promote China's space science research and applications to reach a world-leading level. Thank you.
_ueditor_page_break_tag_Xinhua News Agency:
With the completion of the verification stage of the key technologies of the space station, the project has officially entered the construction stage. Could you please share with us what is to be expected for the manned space flight project after the complete construction of China's space station? Thank you.
Hao Chun:
Thank you for your concern for the future development of the project. After the in-orbit construction of the space station this year, the project will proceed to its application and development stage, which will last more than a decade. Our preliminary plan is to launch two manned spacecraft and two cargo spacecraft every year. The astronauts will stay a long time in orbit to conduct scientific space experiments and technology tests and take care of the space station. In a bid to further improve the comprehensive abilities and technological level of the project, we will develop a new generation of manned carrier rockets and manned spacecraft, and the new-generation carrier rockets and the return capsule of the new-generation manned spacecraft will be reusable. The comprehensive abilities of the new generation of manned spacecraft will be greatly enhanced as it will be able to take up to seven astronauts with stronger ascending and descending payload capacity. Meanwhile, we are thinking of expanding the module of the space station in a bid to further support in-orbit scientific experiments and provide better working and living conditions for the astronauts.
Additionally, during the application and development stage, we will use the laboratory cabinets inside of the module and large payload facilities outside of the module to conduct larger-scale space research experiments and new technology tests, which will mainly be in such fields as space life-science and human body research, microgravity physics science, and space astronomy and geoscience. Notably, next year, we plan to launch China's first large space survey telescope to conduct wide-area space surveys and undertake cutting-edge scientific research in the formation and evolution of the cosmic structure, dark matter and dark energy, exoplanets and solar bodies, and so on. We are looking forward to a batch of major innovative results.
Also, we will actively explore the commercial development model of manned spaceflight and introduce social forces to participate in the construction, operation, and maintenance of the space station in order to constantly improve its comprehensive benefits and promote the high-quality development of China's manned spaceflight engineering.
Throughout the development history of manned spaceflight around the world, the moon has always been a favored place for manned spaceflight to move towards deep space. China's manned spaceflight project will move from near-earth to earth-moon space and then to deeper space. In the process of building the space station, we have also strived to make key technological breakthroughs and conducted studies and research on the plan for a manned lunar probe. I believe that the millennia-long romantic dream of the Chinese nation for a trip to the moon represented by the tales of Chang'e and others will become reality in the near future.
Thank you.
_ueditor_page_break_tag_CGTN:
After the successful return of the Shenzhou-13 crew, there is growing anticipation toward the following manned spaceflight missions. It is understood that there are two batches of six astronauts to carry out missions this year. I would like to ask, what are the missions of the Shenzhou-14 and Shenzhou-15 space crews, and what preparations have been completed? Thank you.
Huang Weifen:
Thank you for your questions. According to the task arrangement during the construction stage, the crews for the two manned missions have been selected. At present, the crews of Shenzhou-14 and Shenzhou-15 are in good condition and are actively carrying out relevant training and mission preparations.
Both crews will stay in orbit for six months, and they will for the first time rotate in orbit to realize uninterrupted manned residence. The two crews, totaling six astronauts, will live together in orbit for five to 10 days, which will bring more serious challenges to the astronaut system.
The Shenzhou-14 crew will cooperate with ground control to complete the assembly and construction of the space station and gradually develop it from a single-module space station into a three-module combination. In this process, nine assembly formations, five rendezvous and docking missions, three separation and evacuations, and two transposition missions will be undertaken. They will enter the Wentian and Mengtian lab modules for the first time to build a manned environment. They will also cooperate with ground control to carry out tests on the two-module complex, the three-module complex, the station's large and small mechanical arms, and the exit function of the airlock cabin in the lab modules. They will use the airlock cabin to carry out extravehicular activities for the first time and complete the unlocking and assembly of the 14 cabinets in the Wentian and Mengtian lab modules. The Shenzhou-15 crew will also carry out several extravehicular activities; assemble, test, and debug the payloads inside modules; and control the mechanical arms to install extravehicular payloads. They will also operate, manage, and maintain the largest complex composed of three modules and three spacecraft. The two crews will undertake science popularization and other public activities, in-orbit scientific research experiments and engineering technology tests, and will collect flight mission data. They will also carry out in-orbit health monitoring, protective exercises, in-orbit training and drills, station platform inspections and tests, equipment maintenance, and station and material management.
Based on the characteristics of the missions in the construction stage, the astronaut system has designed and implemented more than 200 training programs in eight categories in accordance with the principle of "strict and demanding training under combat conditions and integrating tests with training." By doing so, we aim to prepare our astronauts for missions in various aspects of mind, body, psychology, knowledge, and operation skills. On the basis of comprehensive and systematic training, we have intensified efforts in the following aspects:
First, we have carried out intensive training for the setting of the Wentian and Mengtian lab modules when astronauts first enter them, as well as the operation management, equipment operation, maintenance and repair, material management, and station management of various combination configurations.
Second, to prepare for missions such as robot arm verification and extravehicular activities through the airlock, we have completed training in robot arm operation, extravehicular activity procedures, coordinated cooperation, weightlessness simulation and low-pressure environment, among others.
Third, we have enhanced the training in malfunction emergency response and the rendezvous and docking of the lab modules through remote control and manual operation.
Fourth, we have strengthened physical and strength training, psychological adjustment training, and supporting skills training for in-orbit health, life, and work stay.
Fifth, we have finished dozens of training programs concerning space experiments, tests and platform operation.
Sixth, relevant astronauts have participated in nearly 100 engineering development tests, such as the man-ship combined test, man-station combined test, and ergonomics evaluation test, and been deeply involved in the writing of the flight manual and plan. While giving full play to the role of astronauts, we have constantly improved their comprehensive capabilities under combat conditions.
In addition, personalized training and personalized health security work have been reinforced. Multiple arrangements have been made for the Shenzhou-14 and Shenzhou-15 crews to communicate with the crews of Shenzhou-12 and Shenzhou-13. On the basis of the Shenzhou-13 mission, we have further improved the supporting measures for astronauts' long-term in-orbit stay so as to ensure that they can live healthily and work efficiently in orbit, and complete their missions successfully. Thank you.
_ueditor_page_break_tag_Cover News:
After 30 years of development of China's manned space program, the Tiangong space station will finish its construction this year and begin large-scale application. What role will the achievements in space technologies and experiments play in improving people's well-being? Thank you.
Hao Chun:
The manned space program is a lofty but practical cause. Through its development, we can also promote the upgrading of relevant industries and advance economic and social development, which are closely related to the national economy and people's livelihood. I think this is mainly reflected in the following aspects:
The first is to promote scientific and technological development. The manned space program is a scientific and technological activity involving the most complex system, the most intensive technology, and the most active innovation. As sci-tech achievements continue to emerge in the process, they will be directly applied to various fields related to the national economy and people's livelihood. For example, relevant technologies, such as the space liquid rocket engine's combustion and heat transfer system control, can drive the upgrading of pulverized coal pressurized gasification industry, help solve the problem of domestic waste disposal, and effectively improve the efficiency of hydrogen cells. In addition, technologies related to such fields as control, measurement, image processing, and components involved in the development of rockets, spacecraft, the space station, and other aircrafts can help upgrade the industrial intelligent control system. The heat-resistant base technology of the manned spacecraft has been used to make heat insulation materials for civil use. The just-concluded Beijing 2022 Winter Olympics applied a host of space technology outcomes to the opening ceremonies, the closing ceremonies, and the athletes' training equipment, among other areas.
The second is to serve economic growth. Over the past 30 years, preliminary statistics show that more than 4,000 technological achievements of China's manned space program have been widely applied across diverse industries in the national economy, driving technological and technique innovation as well as industrial upgrading in raw materials, microelectronics, machinery manufacturing, communication, and the seed industry, among others. For instance, according to preliminary estimates, space breeding technology has not only promoted crop improvement, but has also been widely used in food processing, bacteria cultivation, biomedicine, and other fields, which has generated direct economic benefits of more than 200 billion yuan so far, and contributed to food security and ecological protection.
The third is to improve people's livelihood. As you all know, some of the convenience food and daily necessities like diapers that we are so familiar with all came from the transformation of manned space technologies. Nowadays, more space technologies will be applied for civil use. For example, space protein crystallization is being researched to develop new drugs to fight against osteoporosis and muscular dystrophy. Furthermore, the manned space environmental control and life support technology, microgravity combustion mechanism research, and new materials research can also be translated and applied in various fields related to people's livelihood and deliver more benefits.
In the future, many scientific experiments and new technology tests in such fields as space life science, space material science, microgravity fluid physics, space technology, and space medicine will be conducted in China's space station, which is expected to make major achievements and breakthroughs in scientific exploration and applied research. At the same time, we believe that more relevant technologies will be transformed to serve social and economic development, the national economy, and people's livelihood.
Thank you.
Shou Xiaoli:
Thank you to all speakers and friends from the media. Today's briefing is hereby concluded.
Translated and edited by Wang Yiming, Wang Qian, Liu Sitong, Wang Yanfang, Duan Yaying, Zhang Junmian, Liu Jianing, He Shan, Yang Xi, Yuan Fang, Xu Kailin, Li Huiru, Zhou Jing, Qin Qi, Xu Xiaoxuan, Chen Xia, David Ball, Jay Birbeck, and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Wang Hesheng, vice minister of the National Health Commission (NHC) and administrator of the National Administration of Disease Control and Prevention
Zeng Yixin, vice minister of the NHC
Jiao Yahui, director of the Bureau of Medical Administration of the NHC
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
March 18, 2022
Shou Xiaoli:
Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). To implement the major directives of the Central Committee of the Communist Party of China (CPC) on COVID-19 prevention and control, today the SCIO is holding a press conference on the rigorous COVID-19 response, and we will also answer your questions. We are joined by Mr. Wang Hesheng, vice minister of the National Health Commission (NHC) and administrator of the National Administration of Disease Control and Prevention; Mr. Zeng Yixin, vice minister of the NHC; and Ms. Jiao Yahui, director of the Bureau of Medical Administration of the NHC.
Now, I will give the floor to Mr. Wang Hesheng.
Wang Hesheng:
Friends from the media, good afternoon. Thank you for your interest in and support for the COVID-19 prevention and control work. First, I will introduce the current priorities of the COVID-19 response, and then my colleagues and I will take your questions.
The CPC Central Committee and the State Council attach great importance to COVID-19 prevention and control. General Secretary Xi Jinping has taken personal command, planned the response, and made a series of important instructions. He has emphasized adherence to the overall strategy of "preventing inbound cases and domestic resurgence" and the dynamic zero-COVID approach, as well as the need to coordinate the COVID-19 response with economic and social development.
Yesterday, on March 17, General Secretary Xi Jinping presided over a meeting of the Standing Committee of the Political Bureau of the CPC Central Committee to analyze the latest COVID-19 developments and arrange for better and more stringent epidemic control measures. General Secretary Xi Jinping emphasized that victory comes from perseverance, and all local authorities and government departments must be fully aware of the complex, arduous and enduring nature of COVID-19 control both at home and abroad, further social mobilization, build consensus, proceed with greater confidence and perseverance, and carry out all the epidemic control work in a more solid and meticulous manner. He emphasized the need to always put people and their lives first, adhere to the dynamic zero-COVID approach with science-based and targeted measures, and contain the spread of the virus as soon as possible. He said that efforts must be taken to make the epidemic response more science-based and targeted and keep optimizing the response measures. He also called for maintaining strategic focus, pursuing progress while ensuring stability, coordinating the COVID-19 response with economic and social development, adopting more effective measures, striving to achieve the best results in epidemic control with minimum costs, and minimizing the epidemic's impact on the economic and social development.
The NHC and the National Administration of Disease Control and Prevention have been earnestly implementing General Secretary Xi Jinping's important instructions. In response to multiple local case clusters in parts of China, we have worked with relevant authorities to strengthen guidance for key regions. We have worked to ensure "early detection, reporting, isolation and treatment," implement stringent epidemic prevention and control, and resolutely take more effective and targeted measures. These steps are aimed at suppressing local outbreaks as soon as possible and providing an enabling environment for people's lives and economic and social development.
First, we have worked swiftly on the emergency COVID-19 response. Recently, China has seen cluster infections spreading widely and occurring frequently in multiple regions. The comprehensive working group under the State Council's inter-agency task force immediately sent national working groups to provinces including Jilin, Shandong, Guangdong and Heilongjiang to guide their COVID-19 response. The groups worked with local authorities to assess the COVID-19 situation, develop response measures, accelerate screening through nucleic acid testing, investigations and regional checks, ensure "early detection, reporting, isolation and treatment," provide the best possible treatment for patients, and curb the spread of the virus.
Second, we have consolidated the defense line against inbound infections. We worked to ensure sound prevention for people, objects and environments, tighten personnel management at points of entry, implement strict closed-loop management, and increase the frequency of nucleic acid tests; guard against risks from imported cold-chain food and high-risk non-cold-chain objects; step up the management of border areas and points of entry, and intensify the crackdown on illegal entries and exits. We worked vigorously with our land neighbors to build a joint prevention and control mechanism and ensure sound epidemic prevention and customs clearance for cargo at border areas.
Third, we have increased capacity for preventing, controlling and handling infections. We improved COVID-19 response plans on monitoring, epidemiological investigation, quarantine for medical observation, community (village)-based epidemic prevention and control, sample collection and testing. We worked to ensure those who test positive are reported and investigated immediately and control measures are taken before screening. We regulated work on the screening of people at risk, the management of close contacts, and identification of risk areas. We attached equal importance to both traditional Chinese medicine and Western medicine and provided standard and regulated treatment. We worked to guarantee the implementation of the first consultation responsibility system and strengthen prevention of hospital-acquired infections. We carried out record-based management of more than 7,000 fever clinics and over 800 designated hospitals. We also enhanced our testing capacity, with national testing capacity reaching over 40 million samples per day.
Fourth, we work hard to implement vaccination programs. In line with the plans of the State Council joint prevention and control mechanism, we have guided local authorities to step up COVID-19 vaccination and booster vaccination efforts in a proactive, prudent, and orderly manner and further raise the overall vaccination rates.
Our achievements in epidemic prevention and control are not easily attained, and it is important to fully recognize their value. Next, we will work together with relevant departments to fully implement the decisions and plans of the CPC Central Committee and the State Council and further step up our efforts in key epidemic control tasks.
First, we will bring local cluster infections under control as soon as possible. We will guide key regions to accelerate nucleic acid testing and speed up identification, epidemiological investigation, and management of at-risk groups so as to achieve dynamic zero-COVID in communities as soon as possible.
Second, we will reinforce the line of defense against imported cases. We will adopt remote prevention and control measures on inbound arrivals, prioritize close-loop management, and expand monitoring coverage of key groups. We will also see that special working teams at port-of-entry areas fulfill their responsibilities for COVID-19 control by stepping up patrols along river banks and coastlines and strengthening the deployment of anti-epidemic personnel.
Third, we will strengthen routine epidemic control and management in key places and key regions. Guidance will be given to schools, nursing homes, detention centers, passenger terminals, shopping malls, supermarkets, and other key venues and densely populated places, as well as cold-chain workers, shopping mall and supermarket staff, logistics workers, and people from other key sectors, for them to strictly implement anti-epidemic measures.
Fourth, we will make the epidemic response more science-based and targeted. We will strictly implement pre-examination triage, and the first consultation responsibility system. We will also improve the mechanism for issuing early warnings through multiple channels and promote a monitoring model that uses antigen testing for earlier detection and the nucleic acid test for diagnosis. Guidance will be given to local authorities to ensure that their epidemic control work will be more science-based and targeted, minimizing the epidemic's impact on economic and social development.
That's all for my introduction. Thank you.
Shou Xiaoli:
Thank you for your introduction, Mr. Wang. Let's move on to the question-and-answer session. Please identify the media outlet you represent before asking a question. Now the floor is open for questions.
_ueditor_page_break_tag_China Media Group:
The recent infections feature outbreaks in multiple regions, a wide spread of the virus, and a large number of confirmed cases. What is your assessment of this round of infections? What features have you found from virus origin tracing? What do you think is the reason for the recent resurgence? Thank you.
Wang Hesheng:
Thank you. Now I will answer your questions. Just as you said, we have indeed seen recent infections spreading widely and occurring frequently in multiple regions. There are four main reasons:
First, since December 2021, the world has witnessed the fourth pandemic peak of COVID-19, which has lasted for 11 consecutive weeks up to now, with more than 10 million cases reported each week. These figures show that the world is still at a pandemic peak. Since the start of this year, in particular, the virus has spread rapidly in our neighboring countries and regions, producing an increasing "pressure difference" in COVID-19 spread between China and its neighbors. In the first two months of this year, the average number of daily imported infections reached 91 cases, far more than 22 cases in 2020 and 32 cases in 2021. In March 2022, the average number of daily imported infections exceeded 200, with the highest daily number exceeding 300 cases. All these indicate a significant increase in the pressure caused by the recently imported infections.
Second, the Omicron variant of the coronavirus that is now dominant worldwide, especially the Omicron BA.2 sub-variant, is more contagious and less detectable than other strains. So this makes it harder to detect the virus at an early stage. When discovered, the Omicron variant may have already spread to a wide area. And this means that it has become more difficult for us to handle and control the coronavirus.
Third, in late February, Spring Festival ended, the spring semester began, and companies and workers resumed normal work, which brought a massive flow of population. And there was also an increase in gatherings, such as meetings, training activities, weddings, and funerals. All of these have magnified and amplified the spread of COVID-19, leading to the fast spread of coronavirus and even the transmission across regions.
Fourth, some may think the Omicron variant appears to have relatively mild symptoms and is no different from the flu, then they relax their vigilance in guarding against the coronavirus and are not fully prepared to respond to COVID-19, lowering requirements for regular containment measures and emergency responses.
According to analyses and assessments by experts, this wave of global COVID-19 outbreak is still at a high level and will not come to an end soon. China will continue to face a situation where Omicron-dominated infections may occur in multiple locations simultaneously. It means that epidemic prevention and control will be even more serious and complex.
Epidemiological tracing results also show that the recent cluster infections in multiple regions of China were all caused by inbound cases. In addition, most of the people infected with the Omicron variant present mild symptoms or are asymptomatic, so it is hard to detect the source of the virus and the means of transmission vary significantly. We have discovered multiple transmission routes in different regions and found the source of the coronavirus diverse and complex. This brings huge challenges to the epidemiological tracing work and COVID-19 response.
The characteristics of this wave of the coronavirus outbreak require us to further increase sensitivity in our monitoring and early warning efforts, improve the multi-point trigger mechanism for monitoring, and effectively improve our capacity to detect the coronavirus at an early stage. Thanks.
_ueditor_page_break_tag_Kyodo News:
We know that China's dynamic zero-COVID policy has been successful. However, the recent COVID-19 containment measures may restrict China's manufacturing sector and consumption and make it difficult to communicate with the overseas market, which triggers worries from foreign-invested enterprises. Will the dynamic zero-COVID policy see any changes in the first half of this year? Thanks.
Wang Hesheng:
Thank you, I will answer your question. Since the outbreaks, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, China has always put people's lives and health first. We have strengthened our COVID-19 response on all fronts, which delivered outstanding performance and protected the safety and health of the public to the utmost.
The dynamic zero-COVID approach was put forward under the principle of preventing the coronavirus from entering the country and stemming its domestic resurgence, and is based on summarizing our experiences and learning from lessons. The approach requires us to detect cases at an early stage, contain small outbreaks, and focus on work at a primary level so as to improve our COVID-19 response and our capacity to detect COVID-19 cases early. We act swiftly to detect the people infected and outbreaks at an early stage. When discovered, we take immediate actions to cut off virus transmission so as to reduce infections and achieve dynamic zero infection. The goal of the dynamic zero-COVID approach is to bring the epidemic under control in the shortest possible time with a minimum cost to society. The essence of the approach is to act swiftly and take targeted measures to prevent and control the coronavirus. When we say "act swiftly," we mean to detect and handle the virus rapidly and cut off its transmission quickly. When we say "targeted measures," we mean that the measures are put in place throughout all links, including epidemiological tracing, quarantine, community-level disease prevention and control, and clinical treatment.
We should be aware that China has well balanced COVID-19 prevention and control and its economic and social development. The country has become the world's only major economy to register positive growth. This progress did not come easily. It has been proven that China's practice in responding to COVID-19 has safeguarded people's lives and health and ensured economic growth.
In fact, COVID-19 has affected the economic and social development of all countries across the world to different degrees. But the results of different COVID-19 response strategies and measures may vary in easing and controlling those negative impacts. When assessing the impact on the economy or the cost of prevention and control measures, we should figure out what kind of impacts are caused by COVID-19 itself, what is brought by economic development, and what impacts the COVID-19 response strategy and containment measures will have. I don't think we can solely owe the economic impacts to the COVID-19 response strategy and epidemic prevention and control measures.
Second, when assessing the cost and effect of COVID-19 response measures, we should take a scientific approach. They can be assessed in four dimensions.
The first is the cost and result of prevention and control; that is, how much cost is spent, how many infections, severe cases and deaths are reduced. I think the prevention and control concept of our Party and government is that people come first, life comes first, and that we must protect the lives and health of the people to the greatest extent possible. Therefore, we can see that the total number of infected individuals, the number of cases, the number of severe cases, and the number of deaths in China are very small, which shows that the cost-effectiveness ratio of prevention and control in China is high.
The second is cost-efficiency; that is, the speed with which the pandemic can be contained and extinguished. China's prevention and control work is basically within the one or two longest incubation periods to quickly deal with and quickly extinguish the pandemic, which shows that the cost-efficiency ratio is high.
The third is cost-utility; that is, through the dynamic zero-COVID approach and precise prevention and control. China has ensured the normal production and life of the vast majority of regions and people, reducing inconveniences caused by the pandemic and even reducing psychological and other health problems. This shows that, by limiting the normal activities of a very small portion of people and controlling the population movements within a very small part of the country, we ensured the normal production and life of the broadest areas and people.
The fourth is cost-benefit; that is, the economic benefits achieved at the cost of prevention and control. In this regard, the key is to look at the big picture and do not only focus on the current situation. It is neither comprehensive nor objective to calculate cost-benefit only based on the costs incurred at the location and time of an outbreak. We should take the entire country as a whole and consider the general benefits to the entire economy, the entire society and the overall well-being of the people.
Facts have proven that the practice of the dynamic zero-COVID approach is in line with China's national conditions and scientific laws. The approach is correct and the result is good. Although the prevention and control measures of the dynamic zero-COVID approach will have some impacts on production and life in some areas, these impacts are short-term and limited in scope. We should say, any prevention and control measures will have certain costs, but for protecting people's lives and health, these costs are worth it. Here I would like to express my special thanks to our broad masses of the people for their understanding, support, and cooperation with the pandemic prevention work.
China's anti-pandemic practice shows that adhering to the dynamic zero-COVID approach is the current pandemic defense line that we as a great country with a population of more than 1.4 billion must guard. This is our best way to embody the idea of "people first" and "life first". This is also the biggest contribution to the international fight against the pandemic. Thank you.
_ueditor_page_break_tag_Southern Metropolis Daily:
What is the current progress of vaccination in China? What is the difference between sequential booster immunizations using vaccines from different technical routes and homologous booster immunizations using vaccines from the same technical route? What is the next step for implementation? Thank you.
Wang Hesheng:
We'd like Mr. Zeng Yixin to answer these questions.
Zeng Yixin:
Thank you for your interest in vaccinations. According to the decision-making and deployment of the CPC Central Committee and the State Council, and the unified arrangements of the Joint Prevention and Control Mechanism of the State Council, all parts of the country are steadily and orderly advancing the vaccination of the COVID-19 vaccines. As of March 17, China has reported more than 3.21 billion doses of vaccinations and the total number of people vaccinated is more than 1.27 billion, among whom more than 1.24 billion people have completed the full course of vaccination, accounting for 87.85% of the total population, while 644.68 million people completed booster immunizations.
According to the pandemic situation, the needs of prevention and control, and the progress of vaccine development and use in China, starting from October 2021, the Joint Prevention and Control Mechanism of the State Council launched the work for COVID-19 vaccine homologous booster immunizations. That is to say, the same vaccine used for the full course of vaccination will also be used for the booster shot. We call this the "homologous booster." Recently, we have made some additional supplements and improvements to the COVID-19 vaccine booster immunization strategy, adding sequential booster immunization. The sequential booster immunization means that the booster immunization can choose a vaccine different from the original basic immunization. What is currently approved is that on the basis of inactivated vaccines, the vaccination can be boosted with adenovirus vector vaccines, or it can be boosted with recombinant protein vaccines. Next, we will probably add more options based on the progress of vaccine research and development in China.
According to the current policy, all people who meet the requirements for booster immunizations can receive booster immunizations six months after the full course of basic immunization. The booster immunization includes homologous or sequential immunization. For eligible populations, choosing one immunization option is enough for each person, be it either homologous or sequential vaccination. You all are also concerned about the differences between homologous and sequential vaccinations. Some relevant studies have been carried out at home and abroad on this issue, and some reports have been published. These studies show that both the homologous booster and sequential booster can significantly improve the immune protective efficacy, which is very clear. I just said that more than 600 million doses of booster immunization have been completed in China. Since the sequential booster immunization was carried out a little later, of the more than 600 million doses, most are homologous. However, from the adverse reaction data we have collected, there is no significant difference in adverse reactions between the two methods, so please feel free to vaccinate. We hope that people who meet the requirements for booster immunization, especially the elderly and those with underlying diseases, can take the initiative to vaccinate and get vaccinated in a timely manner so as to increase the protection of their own health and contribute to the pandemic prevention of the whole society. Thank you.
_ueditor_page_break_tag_Red Star News:
The NHC has released the ninth version of the COVID-19 diagnosis and treatment guidelines, making important adjustments in the management of people with mild COVID-19 infections and the cycle threshold value of a nucleic acid test. What are the reasons for the adjustments? Does it mean that prevention and control measures have been relaxed? Is it necessary for all localities to continue to implement strict prevention and control measures?
Jiao Yahui:
Thanks for your questions. First, I would like to make it clear that revisions to China's COVID-19 diagnosis and treatment guidelines do not mean relaxed prevention and control measures. All localities should continue to carry out COVID-19 prevention and control work with caution constantly. The revisions are based on our country's anti-epidemic experience over the past two years, especially the observation and research of clinical cases infected with the Delta and Omicron variants. The main adjustments involve the detection and reporting of cases and the adding of antigen testing to form the "antigen test plus nucleic acid test" tactic. In addition, we proposed classified treatment. We have also made adjustments to antiviral treatment, TCM treatment, criteria for being released from isolation and discharged from hospitals, and management following discharge. The adjustments are made in accordance with General Secretary Xi Jinping's important instructions to make the COVID-19 response more scientific and targeted, and achieve maximum effect in prevention and control with minimum cost.
I would like to give a detailed explanation on changes to the admission of cases. In terms of classified treatment, people with mild COVID-19 infections will be placed at centralized isolation facilities rather than in designated hospitals, according to the latest version of the guidelines. Mild, severe, and critical cases, as well as cases with other high risks, will be admitted to designated hospitals. In other words, asymptomatic and mild cases will be placed in centralized isolation. Here I want to clarify that centralized isolation facilities for asymptomatic and mild cases must be strictly separated from those designated for close contacts and overseas travelers because mild and asymptomatic cases have positive nucleic acid test results, while close contracts usually have negative nucleic acid test results, so isolation facilities for them must be strictly separated.
In response to the pandemic, some regions use special isolation facilities, such as Shandong province and Jilin province, where temporary treatment centers have been built. That doesn't mean that people with mild COVID-19 infections and asymptomatic cases placed in centralized isolation will go uncared. The revised guidelines require that the centralized isolation facilities where these cases are treated should also be staffed with medical personnel. What are the duties of those medical personnel? On the one hand, they should provide therapies to the mild cases, such as cases with symptoms of nasal obstruction, a cough, and fever. On the other hand, they should monitor the patients' conditions. Based on our practice, about 95 percent of patients in the latest outbreak are asymptomatic or only show mild symptoms. Although there are fewer treatment and intervention measures for them, it does not mean that we will leave them unattended. If their condition worsens, they will be timely transferred to designated hospitals for further treatment.
The other thing that people are concerned about is the CT (cycle threshold) value — part of the discharge criteria. In the ninth version of the diagnosis and treatment plan, we proposed that patients can be discharged from hospitals or centralized isolation when their two consecutive CT values are both 35 or above with at least 24 hours between the two tests and that the COVID-19 symptoms relieved, with some hospitalization-required symptoms gone. The adjustment is also based on our practical research. Research showed that the live virus cannot be isolated from samples of convalescent patients whose CT value is 35 and above, meaning that these patients are no longer infectious. Therefore, such patients can be discharged from hospitals and return home. These adjustments have been made to improve the utilization efficiency of medical resources. For one thing, we can concentrate in-need cases in hospitals to ensure effective medical treatment. For another, it also leaves us more medical resources to provide normal medical services for the public. The adjustment has fully embodied implementing the principle of putting the people and their lives first.
As for post-discharge management, we changed the previous 14-day isolation into seven-day health monitoring at home. Thus, the adjustments made to the latest diagnosis and treatment plan does not mean the pandemic prevention and control policies have been relaxed. Instead, they are more scientific, precise, and targeted. Thank you.
_ueditor_page_break_tag_Bloomberg News:
I have two questions. One of the biggest impacts the dynamic zero-COVID policy has on the economy is that factories have to shut down and people have to quarantine for long periods. What can the government do to reduce that impact? Do you have any plans to introduce foreign vaccines or other foreign medicines to aid with the treatment of coronavirus? Thank you.
Wang Hesheng:
I'll answer these questions. First, thanks for your attention. Since the outbreak of COVID-19, the NHC and the National Administration of Disease Prevention and Control have resolutely implemented the decisions and arrangements made by the CPC Central Committee and the State Council, actively guided the localities to strengthen scientific prevention and control to take targeted measures, and firmly adhered to the overall strategy of preventing case imports and domestic resurgence as well as the general dynamic zero-COVID policy. With our continuously deepening understanding of how the novel coronavirus behaves, our anti-pandemic policies and measures have been consistently adjusted and improved in accordance with the changing epidemic situation and actual needs of the prevention and control work so as to make the work more scientific and accurate.
Since the anti-epidemic work entered the dynamic zero-COVID stage of targeted prevention and control across the whole chain, we have focused on early detection of sporadic cases to enhance the capacity of epidemic prevention and control and early spotting. Our work is mainly carried out in the following aspects:
First is to highlight prevention and improve the ability to prevent case import. We issued the Notice on Strengthening COVID-19 Prevention and Control in Port Cities and put forward clear requirements from multiple aspects to further rationalize mechanisms and clarify responsibilities. The aspects include improving the pandemic prevention and control mechanism in port cities; ameliorating the epidemic monitoring and early warning system; strengthening land and maritime border control; ensuring personal protection and closed-loop management of personnel in high-risk positions; enhancing prevention and control of each link of the cold chain; standardizing the monitoring, disinfection, and disposal of high-risk articles and environment at ports; increasing the capability of epidemic prevention, control, and handling; and securing people's livelihood.
Second is to emphasize early detection. We have further ensured that all those in need are tested, and made efforts to increase the frequency of nucleic acid tests and health monitoring of personnel working in port-of-entry areas, centralized isolation sites, designated medical institutions, and other key areas. We have fully leveraged the sentinel role of fever clinics, implemented the first consultation responsibility system, and regulated the reception and treatment procedures for patients with fever in individual clinics and community-level medical institutions. We have set up multi-channel and multi-spot trigger mechanisms in pharmacies, educational institutions, and community-level medical institutions, among others.
Third is to underline real results and upgrade the preparedness for dealing with the pandemic. All localities have been required to establish and maintain an emergency response command mechanism during both normal and emergency periods and apply the horizontal management model. At the national level, we have set up 16 national expert teams of epidemiological investigation responsible for eight regions nationwide. All localities have been required to set up sufficient epidemiological investigation teams composed of various departments of health, disease control, public security, and industry and information technology, and carry out exercises and training to effectively improve the epidemiological investigation capacity. We have also demanded that local governments effectively enhance the reserve capacity of nucleic acid test teams and coordinate and allocate resources to ensure that the nucleic acid test tasks are fully completed within a specified time.
Fourth is to accentuate speed and boost early handling of the pandemic. In the "golden 24 hours" after the detection of positive cases, while the positive samples in the preliminary screening are retested, emergency preparedness including epidemiological investigation, nucleic acid test, quarantine site arrangement, and community management and control will be simultaneously activated in accordance with the principle of reporting any positive case immediately, conducting investigation immediately after receiving the report, and controlling first before screening. We have ensured that multiple tasks of command system construction, nucleic acid test, isolation, medical treatment, and press release can be carried out in parallel.
Fifth is to underscore "strictness" by intensifying installation and management over designated hospitals. We have strengthened prevention and control over hospital infections, and reinforced installation and management over fever clinics, making sure that all hardware facilities meet the requirements for the prevention and control of respiratory infectious diseases. We have strictly implemented closed-loop management over the staff working at those fever clinics which receive high-risk groups, including fever patients from overseas and from medium-high risk areas and centralized quarantine locations in China. We have strengthened installation and management over designated hospitals, reinforced equipment and training over the prevention and control personnel against hospital infections, intensified screenings of medical workers before entering isolation wards, and earnestly put every prevention and control measure against hospital infections in place.
Next, the NHC and the National Administration of Disease Control and Prevention will jointly work with other relevant departments to conduct training and drills on a regular basis to improve practical emergency response abilities and multi-department collaboration abilities, and intensify risk monitoring and screening at key links. We have to prevent misinterpretation of policies, one-size-fits-all solutions, excessive implementation of policies, and other problems at local level while ensuring the full implementation of all measures, in a bid to create a sound environment to ensure people's wellbeing and promote economic and social development.
Regarding the question raised by this journalist on whether more foreign-developed vaccines and medicines will be introduced, I suggest you consult relevant departments. Thank you.
_ueditor_page_break_tag_China Daily:
As Ms. Jiao mentioned, according to the ninth edition of China's COVID-19 diagnosis and treatment guidelines, recovered patients only need to monitor their condition at home for seven days after being discharged from quarantine locations or hospital, instead of conducting health monitoring and 14-day quarantine after being discharged from hospital. Could you please tell us the reasons for those modifications?
Jiao Yahui:
Thank you for your question. As we mentioned before, relevant studies have shown that the live virus can not be separated from samples if a patient's cycle threshold value is greater than or equal to 35. Given that, we have made such a modification. First, it is no longer contagious when the cycle threshold value is greater than or equal to 35. On the other hand, given on our study on reconfirmed positive cases in China, the epidemiological survey has demonstrated that those cases had not caused any transmissions or infections. Therefore, patients can be discharged from hospital when their cycle threshold values reach 35.
Second, the previous requirement that patients should spend 14 days in centralized quarantine or go to rehabilitation hospitals was based on our general experience. Now that we have proved it's non-infectious, it's reasonable to adopt at-home isolation and monitoring rather than centralized quarantine. Another adjustment is the change from 14 days to seven days. According to hospitals' observation on recovered patients infected with the Delta variant as well as those infected with the Omicron variant, their body functions can recover within seven days basically; thus, the time has been shortened from 14 days to seven days. Given our observations, research, and analysis of clinically diagnosed cases, we cut the time and adopted at-home isolation instead of centralized quarantine. Notably, in spite of staying at home, the patients still have to strictly implement health monitoring. Thank you.
_ueditor_page_break_tag_New York Times:
Other countries and territories have found the elderly are the most vulnerable, and the only reliable way to protect them is through vaccination. What percentage of people in China who are 80 or older have had one vaccine, or have had two vaccines, or have had three vaccines for the coronavirus? And what are you doing to encourage these elderly people to be vaccinated fully if they have not already received two or three vaccines? Thank you.
Zeng Yixin:
It's a problem of great importance. The Joint Prevention and Control Mechanism of the State Council has always attached great significance to promoting vaccination among the elderly population in China by repeatedly making arrangements and plans. Additionally, the local departments have actively taken multiple measures to boost the vaccination rate among the elderly. You only mentioned people older than 80; I will introduce the general vaccination situation of people who are 60 or older. As of March 17, for people aged 60 to 69, the first dose rate, the full vaccination rate, and the booster vaccination rate hit 88.8%, 86.6%, and 56.4%, respectively. Among people aged 70 to 79, the numbers are 86.1%, 81.7%, and 48.4%, respectively. As for the group who are 80 or older, which you are mostly concerned, those three figures are 58.8%, 50.7%, and 19.7%, respectively. Generally speaking, of the 264 million people aged 60 or older, 211.76 million have been fully vaccinated, which means there are still 52 million people who have not received full vaccination. Among those, those aged 80 or older account for the largest proportion as their full vaccination rate and booster vaccination rate are a mere 50.7% and 19.7%, respectively. Both are relatively low percentages. As for the elderly, full vaccination and booster vaccination are of great importance, especially for people aged 80 or older. Therefore, we will step up efforts to vigorously promote vaccination among the elderly.
The immune system of the seniors is weaker than that of the young, and most of them have various underlying medical conditions. Once infected with the coronavirus, the risk of severe illness and death is much higher than that of the young. As we all know, there have been many clusters in China since last year, but very few of the infected became seriously ill. In particular, in the cases caused by the Omicron variant, the proportion of severe cases is even fewer. However, in the Yangzhou cluster outbreak that was caused by the Delta variant in August last year, the elderly cases accounted for a high proportion and thus more severe cases were found. There was a total of 1,388 cases in Yangzhou, of which 67 severe cases were among the elderly over 60 years old. Because there are many elderly people, the incidence of severe cases is also relatively high. Among the 1,388 cases, the proportion of people who had a complete course of vaccines was 38%. Among the 67 severe cases, 65 cases were not vaccinated or did not complete the full course of vaccination. In the recent Hong Kong outbreak, it is reported that the mortality rate of vaccinated people is 0.04%, and the mortality rate of those who have not been vaccinated or not fully vaccinated is 1.25%, which is a dramatic difference of dozens of times. Also, in the Hong Kong outbreak, 90% of those who died were elderly people.
From these two examples, two conclusions can be drawn. The first is that vaccines are highly effective at preventing severe illness and death. In Yangzhou, the vaccines used were mainly produced on the mainland. In Hong Kong, mRNA vaccines and inactivated vaccines were mainly used, accounting for about 60% and 40%, respectively. The second is that, the elderly and people with underlying diseases are the most in need of protection and vaccination. I think two conclusions can be drawn from these two examples.
Therefore, in order to further increase vaccination rate among the elderly, the next step is to scale up publicity and mobilization in two aspects. For one thing, we should raise their awareness. We must not only emphasize the principle of vaccination on a voluntary basis, but also emphasize the sense of responsibility. We often say that one should hold the primary responsibility for his or her own health. In the context of the pandemic, vaccination is not only to protect oneself, but also to protect the family, and to contribute to society. For another, we must also actively respond to the concerns of the elderly. Why do the elderly have so many concerns and worries? Why do they lack the motivation to receive vaccinations? It is necessary to figure out the causes and respond to their concerns and questions. For example, how about the safety of vaccines, which is something the elderly are concerned about. What are the side effects, and how is vaccine efficacy? How about the protective effect on the elderly? Will vaccination aggravate underlying diseases? Given that many elderly people have underlying diseases, will they get worse after being vaccinated? There are also elderly people who think that they don't leave their homes frequently and so wonder if it's necessary to get vaccinated? Only when we bring clarity to their unease can we encourage them to get vaccinated. Therefore, relevant units and experts must attach great importance to informing the public about data and relevant information. The media should spread relevant information widely in a way that the elderly like to see. In these ways, the whole of society works together to form a favorable environment that is conducive to increasing the vaccination rate among the elderly.
Second, we should give full play to the role of local relevant departments. Grid management systems can be employed to enable the elderly to get vaccinated. Relevant departments can also actively mobilize key groups such as the elderly and key places such as nursing homes so as to increase the vaccination rate among the elderly.
Third, we should ensure the safety of the elderly getting vaccinated. The vaccination unit should arrange for medical staff who are familiar with the physical condition and the diagnosis and treatment of diseases of the elderly to stand by to provide health care. Before an elderly person gets vaccinated, the medical staff should carry out health assessments on them. After the vaccination, the healthcare professionals should carry out surveillance of the vaccine recipients for signs of adverse events and be particularly prepared for an emergency. Because the elderly may have underlying health conditions, we must ensure prompt and proper medical treatment in case of emergencies.
Fourth, more convenient measures should be taken to facilitate vaccination among the elderly. Mobile vaccination vehicles and other equipment can be used to set up temporary vaccination sites to shorten their round-trip route. Housecalls can also be made for those having difficulty getting about, and more green channels can be set up to shorten the waiting time for old people. We should also make flexible arrangements at vaccination spots according to their demands. By implementing such measures, we believe that the vaccination rate among the elderly is sure to rise soon. Thank you!
_ueditor_page_break_tag_Thecover.cn:
According to a document recently released by the State Council joint epidemic prevention and control mechanism, residents can buy antigen COVID-19 test kits themselves as an additional test method to nucleic acid tests. Do the self-purchased test kits need to be put on record? If a positive test result is not reported, are there any corresponding regulatory measures?
Jiao Yahui:
Thank you for your questions. First of all, residents buying antigen COVID-19 test kits do not need to be put on record. As stipulated in the antigen testing plan, anyone who tests positive using the self-test kits should report the results to their community, and the community will arrange a special vehicle to transport the case to a medical institution for further nucleic acid testing for confirmation. The whole process is a closed loop. The State Council joint prevention and control mechanism has made specific regulations for all localities to make detailed arrangements for the discovery, report and closed-loop management of cases. Provinces have been required to clarify their detailed plans.
Just now, you mentioned whether the reporting of self-tested positive results needs supervision or not. I'd like to remind the general public: on the one hand, as Mr. Zeng has explained, everyone is the first person responsible for their own health as well as the health of their families. On the other hand, the pandemic prevention and control regulations stress responsibilities from four aspects, of which one is personal responsibility. Therefore, we call for timely reporting if a positive result is found through the use of a self-testing kit. In addition, the Law on Prevention and Treatment of Infectious Diseases and other laws and regulations also clearly stipulate that citizens have the responsibility and obligation to report a positive case, and if they violate the rules and cause the spread of infectious disease, they should shoulder the corresponding legal liability.
In our practice of epidemic prevention and control, we can see that some violators in many places have been investigated for legal liability. So, I'd like to remind the public that if they test positive, they should first report it according to the local requirements.
Shou Xiaoli:
Due to time constraints, we'll take one last question.
_ueditor_page_break_tag_China News Service:
Recently, China has seen frequent flare-ups of COVID-19 cases in multiple places, with a large swathe of areas affected. Locally transmitted cases and cluster infections have been reported in a number of provinces. Given the circumstances, what suggestions do you have for strengthening personal precautions? Thank you.
Wang Hesheng:
Thank you. I'm glad to take this question. In my opinion, we need to remind people to strengthen personal precautions throughout every stage of COVID-19 response, not just when the epidemic situation is severe. We need to step up self-protection both when there is no significant resurgence and amid routine epidemic prevention and control. I would like to offer a few suggestions.
First, I would like to continue with the issue of vaccination for senior citizens that Mr. Zeng mentioned earlier. I believe that boosting vaccination and strengthening personal precautions should be the top priority. According to classic theories of infectious disease, controlling the sources of infection, cutting off transmission routes, and protecting vulnerable groups are the top three methods of prevention and control. In this sense, vaccines are the most effective ways to protect vulnerable groups. Vaccination has seen remarkable results based on our practices, especially among senior citizens. The COVID-19 resurgence in Hong Kong is a poignant lesson for us, and the situation proves that a low vaccination rate among the elderly will lead to a high mortality rate. A question raised just now also mentioned that some senior citizens didn't get vaccinated because they thought they rarely went out, which was inconvenient in nursing homes.
Nevertheless, please remember that the vaccinated and unvaccinated will face utterly different consequences once infected, and what happened in Hong Kong is an example. Therefore, while we all treat the elderly with respect and strive to be role models in this regard, we must encourage our senior family members to get vaccinated because they most need personal precautions. China has provided extraordinary vaccines and inoculation services, and every sector is proactively working to implement the work. As far as I know, China's civil affairs departments have made plenty of effort to step up collective prevention and control in nursing homes. This is because many senior citizens also understand the importance of vaccination and are actively applying for inoculation. Therefore, departments associated with vaccines and civil affairs government bodies should work closely together and provide good services for these senior citizens following relevant requirements. All of these are my first-hand experience. We need first of all to make better use of vaccines to strengthen epidemic prevention.
Second, we need to maintain good personal hygiene habits. We have gained good experience after this long epidemic. When staying at home, we need to enhance ventilation and disinfection and maintain personal hygiene. When going outdoors, we must wear face masks, strengthen personal precautions, and keep our hands clean. We also need to practice social distancing and avoid crowded places, gatherings, and group dining activities.
Third, we should do our part in implementing the requirements of COVID-19 response. We should proactively assist in the epidemiological investigation and nucleic acid tests, especially in public spaces' prevention and control requirements. There are many anti-virus requirements in public areas, and we must refrain from acting willfully, playing petty tricks, or refusing to scan health QR codes and follow relevant rules. Cooperating with anti-epidemic work is essential, and it is good to all of us.
In addition, we need to pay close attention to our health status. We must seek medical help and report to the community promptly in case of fever and dry cough. Let's work together to establish a solid society-wide defense line. Thank you.
Shou Xiaoli:
Thank you to all three speakers and friends from the media. Today's press conference is at this moment concluded. Goodbye.
Translated and edited by Zhang Liying, Li Huiru, Li Xiao, Zhang Rui, Cui Can, Wang Wei, Liu Sitong, Yang Xi, Zhang Junmian, Xu Xiaoxuan, Huang Shan, Zhu Bochen, Liu Qiang, Chen Xia, Qin Qi, Yuan Fang, Zhang Tingting, Wang Yiming, David Ball, Jay Birbeck and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Lian Weiliang, vice chairman of the National Development and Reform Commission (NDRC)
Lin Nianxiu, vice chairman of the NDRC
Hu Zucai, vice chairman of the NDRC
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
March 7, 2022
Xing Huina:
Friends from the media, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are joined by three vice chairmen of the National Development and Reform Commission (NDRC): Mr. Lian Weiliang, Mr. Lin Nianxiu and Mr. Hu Zucai, who will introduce the topic at hand and answer your questions.
Next, let's first give the floor to Mr. Lian Weiliang.
Lian Weiliang:
Ladies and gentlemen, friends from the press:
Good morning. On the morning of the day before yesterday, He Lifeng, head of the NDRC, was interviewed on the sidelines of the annual legislative session. Today, along with Mr. Lin Nianxiu and Mr. Hu Zucai, both vice chairmen of the NDRC, I'm very happy to meet you here. First of all, I would like to express my heartfelt thanks and respect to all friends from the media for your long-term concern, support and assistance to the development and reform work.
Since last year, the external environment has become more complex, severe and uncertain. China's economic development is facing threefold pressures of shrinking demand, supply shocks and weakening expectations. Under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, all regions and departments have coordinated pandemic controls and socio-economic development, and innovated and improved macroeconomic regulations and controls, achieving higher growth and lower inflation. China has accomplished its main targets and tasks for last year, and the 14th Five-Year Plan (2021-2025) is off to a good start.
On the morning of March 5, Premier Li Keqiang delivered a government work report, making comprehensive arrangements for various tasks this year, and clarified the goals and tasks for economic and social development throughout the year. The draft plan on national economic and social development in 2022 has been submitted to the National People's Congress (NPC) for review and approval and to members of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) for deliberation. The NDRC will conscientiously implement the decisions and deployments of the CPC Central Committee and the State Council, adhere to the principle of ensuring stability is a priority while making new progress, and focus on stabilizing the macroeconomic market, keep the economy operating within a reasonable range, maintain overall social stability, and take practical actions to greet the convening of the 20th National Congress of the CPC.
Now, we are willing to answer your questions.
Xing Huina:
Thank you for your introduction, Mr. Lian. The floor is now open for questions. Please identify the news outlet you work for before asking your question.
_ueditor_page_break_tag_CCTV:
In the face of the current pressure on China's economic and social development, it is necessary to focus on stimulating economic vitality through reform. What are the key tasks for reforming the economic system this year? How can we further stimulate economic and social development through reform? Thank you.
Lian Weiliang:
Thank you for your questions. Both the Central Economic Work Conference and the premier's government work report clearly stated that "reform and opening-up policies should lend impetus to development." The Party Central Committee and the State Council have deployed a series of major reforms to vitalize development. The NDRC will act on its new development philosophy, build on its new development paradigm, promote high-quality development, and earnestly implement these major reforms, particularly in the five areas of implementing reforms to stimulate the vitality of market players, to build a high-standard market system, to stabilize growth and expand domestic demand, to promote high-level opening-up, and to promote the transition to green and low-carbon growth.
First, we will accelerate reforms to stimulate the vitality of market players. We will complete the three-year action plan (2020–2022) for the reform of state-owned enterprises (SOEs), move faster to adjust and improve the layout and structure of the state-owned sector, and deepen the reform of mixed ownership actively and steadily. We will encourage and guide private enterprises to accelerate the pace of structural reform and achieve high-quality development. We will focus on the concerns of market players, continue to strengthen support for micro, small and medium-sized enterprises (MSMEs), and create a favorable environment for various market players to compete for development. We will advocate an entrepreneurial spirit and accelerate the building of world-class enterprises.
Second, we will accelerate reforms to build a high-standard market system. Efforts will be made to remove market barriers, improve the fundamental market system, and build a unified domestic market. We will carry out comprehensive pilot reforms of the market-based allocation of production factors, strive to achieve major breakthroughs in land, labor, capital and technology, and make significant progress in the basic system related to data. We will steadily promote market-oriented reform of competitive areas in key industries, accelerate the building of a unified national market system for electric power, and further improve the unified national oil and gas market system.
Third, we will accelerate reforms to stabilize growth and expand domestic demand. We will innovate the investment and financing system, promote reforms to introduce a business-invested project commitment system, improve investment facilitation, and better leverage private capital to expand effective investment. We will promote the quality and scale of consumption, further improve the consumption environment, and facilitate the continuous recovery of consumer spending. We will improve the institutions and mechanisms for distribution based on factors of production and expand the size of the middle-income group.
Fourth, we will accelerate reforms to achieve a higher level of opening-up. We will continue to promote institutional opening-up, ensure national treatment for all foreign-invested enterprises, further ease market access for foreign capital, and ensure that the negative list for cross-border service trade is fully observed. We will speed up construction of the Hainan Free Trade Port, and do a good job in the island-wide customs clearance operation. We will optimize services for foreign investors and speed up the implementation of major foreign investment projects.
Fifth, we will accelerate reforms to shift toward green and low-carbon development. Efforts will be made to achieve the peak carbon and carbon neutrality goals. We will improve assessment and statistical accounting systems for greenhouse gas emissions, and avoid one-size-fits-all or campaign-style approaches in carbon reduction. We will speed up improvements to policy incentives for reducing pollution and carbon emissions and policy constraints on such emissions, and launch trials for the trading of energy consumption rights and green power. We will improve the price formation mechanism and promote important breakthroughs in the ecological product value-realization mechanism.
In accordance with the requirements of the CPC Central Committee and the State Council, we will make full use of the "key tactic" of reform to inject strong impetus into the stable and healthy development of the economy and society.
Thank you.
_ueditor_page_break_tag_Nikkei:
Recently, due to the impact of geopolitical conflict, commodity prices have risen sharply, which will inevitably have a negative impact on the Chinese economy to a certain extent. How will the NDRC mitigate the impact of rising commodity prices in order to sustain growth? Thank you.
Hu Zucai:
Changes in the prices of commodities such as grain, energy and minerals are related to people's wellbeing, industrial and agricultural production, and the macroeconomic market. Stable prices will ensure an orderly market, stable economy and society. The CPC Central Committee and the State Council attach great importance to the work of ensuring the supply and price stability of commodities.
Last year, due to factors such as the COVID-19 pandemic, excess liquidity and supply bottlenecks, the prices of international bulk commodities such as oil, natural gas, coal and iron ore rose sharply, driving up global inflation. Prices in many countries hit multi-year highs. For example, the U.S. consumer price index (CPI) rose 7% in December last year, hitting a 40-year high. China's economy is deeply integrated into the world economy. We purchase a relatively high proportion of oil, natural gas, iron ore and other commodities. Rising international prices have increased imported inflation pressure and pushed up the prices of domestic energy and raw materials. In October last year, the domestic producer price index (PPI) reached 13.5%, a new high for many years, which had an adverse impact on the production of enterprises and people's lives, and brought challenges to the stable operation of the macro economy. We fully implemented the decisions and arrangements of the CPC Central Committee and the State Council, coordinated pandemic controls and economic and social development, coordinated development and safety, took multiple measures, and adopted a series of measures to ensure supply and stabilize prices such as making supply and demand adjustments, carrying out market supervision and guiding expectations. All these measures have achieved positive results. The overall domestic price has remained within a reasonable range. Last year, China's CPI rose by an average of 0.9%, in sharp contrast to the high inflation in major international economies, playing an important role in stabilizing global prices.
Since the beginning of this year, influenced by multiple factors such as the COVID-19 pandemic, the adjustment of monetary policies of major economies, and in particular, the aggravation of geopolitical conflicts, the trend in global commodity prices presented to be more challenging and complicated with uncertainties. In recent days, the global oil price surpassed the US$110-per-barrel mark and soared to $139 today. Prices of coal, natural gas, and iron ore remained high, and there is a rising trend in prices of corn and other grains. All these pose a challenge to our work of ensuring domestic supply and stabilizing prices.
Generally speaking, China's economy features strong resilience and large market space. With abundant policy tools, particularly bumper grain harvest in consecutive years, adequate production of hogs, and sufficient supply of industrial and agricultural products and services, China has all the necessary conditions as well as the capability and confidence to continue to keep prices running smoothly. Therefore, the projected target for CPI increase at around 3%, which was set in this year's government work report, is achievable. In January of 2022, China's CPI rose by 0.9% year-on-year, much lower than the percentages in the United States and the eurozone, which were 7.5% and 5.1%, respectively. The year-on-year increase of PPI fell back to 9.1% in January, which was also substantially lower than the level of more than 20% in the eurozone.
To ensure the supply and stabilize prices of commodities are of weighty responsibility. Faced by the complicated and grave situation this year, we will resolutely implement the decisions and arrangements of the CPC Central Committee and the State Council, evaluate worst-case scenarios, implement policies in a comprehensive way, and strengthen precision regulation so as to make every effort to ensure the supply and stabilize prices of commodities.
First, we will make efforts to ensure the supply and price stability of grains to guarantee food security. Grain prices are the basis of all prices. The stability of grain prices can provide solid support for our efforts to stabilize all prices. China has sufficient stocks and supply of rice, wheat, and other types of grains, and therefore is fully self-sufficient. This year, we will ensure a stable sowing area and grain output and make efforts to ensure the supply and stabilize the price of chemical fertilizer. In this way, we will manage to keep grain output sufficient and its price stable, so as to ensure that the Chinese people can hold their bowls firmly. At the same time, we will strengthen our work to ensure the supply and the price stability of corn and soybeans, tap domestic potentials, make more efforts to improve the production capacity of soybeans and oilseed crops, reasonably make use of global resources, strengthen reserve adjustment, and maintain the balance between supply and demand.
Second, we will make efforts to ensure supply and price stability of energy to guarantee energy security. We will focus on the work to stabilize coal supply and prices. China's coal consumption accounts for 56% of the total energy consumption, and coal-fired power generation accounts for about 60%. If the coal price is stable, then the electricity price will be stable accordingly, and furthermore, the fundamentals of energy price will be stable. Recently, the NDRC issued a notice to further improve the pricing mechanism for the coal market, aiming at improving range-based regulation for coal prices and creating synergy between an efficient market and a well-functioning government. Next, we will fully carry out this major reform to ensure the implementation and effectiveness of reform measures. We will improve the coal production, supply, storage, and marketing system, improve the adjustment capacity of supply and demand, ensure a reasonable and sufficient production capacity, strengthen market expectation management, guide coal prices to run within a reasonable range, and improve the transmission mechanism of coal and electricity prices, so as to ensure a secure and stable supply.
Third, we will make efforts to ensure supply and price stability of major minerals to guarantee the security of industrial and supply chains. We will intensify our efforts on domestic exploration and development of iron ore, accelerate the construction of mineral products bases, expand the recycling of steel scrap and other renewable resources, enhance support capacity of domestic resources, strengthen import and export adjustment capacity, and resolutely curb the blind expansion of energy-intensive, high emission, and low-standard projects, so that we can ensure a secure supply and basic price stability of major minerals.
Fourth, we will keep a close eye on market trends and strengthen law-based market supervision. We will pay close attention to the supply and demand and price performance of key commodity markets and strengthen monitoring and analysis to keep abreast of the situation. We will keep high-standard market supervision and strengthen coordinated supervision of futures and spot markets. We will crack down on the fabricating and spreading word of possible price increases, price gouging, hoarding and profiteering, other violations of laws and regulations, and malicious speculation of capital in particular.
Fifth, we will make solid efforts to guarantee a basic living to people who encounter difficulties to ensure that their basic living needs are met. We will guide localities to earnestly implement a linkage mechanism of subsidies, and provide temporary subsidies in full and in a timely manner to effectively guarantee a basic living to people in difficulties.
_ueditor_page_break_tag_Cover News:
Last year, there was a global shortage of energy supply, and some parts of China also saw a shortage of coal and electricity. Although we have ensured a stable supply of energy in a very short period of time, there are still worries about whether a similar situation would take place this year. What countermeasures does the NDRC have to ensure a stable supply of energy? Thank you.
Lian Weiliang:
Thank you for your question. Last year, we indeed faced grave challenges in our efforts to ensure energy supply. China's capability to turn the tide in a short time to ensure energy supply in some places is mainly attributable to the close attention of the CPC Central Committee and the State Council. In recent years, China has planned in advance the construction of energy production, supply, storage, and marketing systems and continued to increase the effective supply of energy. In key window period before the heating season, decisive policies were made, and a series of practical policies and measures were quickly adopted, such as increasing coal production and supply, ensuring full operation of generator units, making early preparation, and keeping sufficient storage of natural gas, as well as coupling the price of coal with that of electricity in a reasonable way. China's institutional strength also helps enhance its capability to ensure energy supply. We have implemented full coverage of medium and long-term contracts for thermal coal and coal used for heating, guided coal prices to return to a reasonable range, and ensured that people's basic energy needs are met. Generally speaking, the energy supply and demand in the heating season was relatively stable, coal stockpiles for heating at power plants were adequate for no less than 20 days of consumption, and there was neither power nor gas rationing. All these have effectively ensured the smooth running of economic and social development as well as a warm winter for all residents.
We understand that our people remain concerned about the energy supply of this year. The global energy supply has been in continuing shortage, both the rapid recovery of our country's economy and rapid growth of exports have driven the rapid increase of energy demand, and our efforts to steadily achieve the carbon-peak and carbon-neutralization goals have required for an accelerated transformation into clean and low-carbon energy, all of which put forward new and higher requirements for ensuring energy supply. China has been deeply integrated into the global economy. The rise in global commodity prices has driven the demand for energy-intensive products, and geopolitical conflicts and changes in global energy supply and demand will affect the security and reliability of the energy supply in our country.
Despite the increasingly unpromising challenges we are facing, China has the condition, ability, confidence and solutions to ensure a secure and reliable supply of energy. In accordance with the deployment and requirements of the CPC Central Committee and the State Council, we will give full play to the coordination mechanism for coal, electricity, oil, gas, and transportation services and focus on ensuring energy supply from four aspects. To be specific, we will emphasize the three "intensifies" and one "ensure," that is, to intensify efforts to increase production capacity, intensify efforts to guarantee reserves, intensify efforts to ensure a stable supply and price, and ensure that people's basic energy needs are met.
First, we will intensify our efforts to increase production capacity. We will vigorously promote the construction of large-scale wind power and photovoltaic bases in sandy areas, rocky areas, and deserts, and build a significant number of peak-shaving plants that utilize pumped storage for electricity generation, by which ways we will increase the effective output of various power generation in a coordinated manner. We will greatly increase investment in oil and gas exploration and development to promote the increase of petroleum and gas reserves and output and free up advanced coal production capacity in an orderly way to maintain the coal output at a reasonable level.
Second, we will intensify our efforts to guarantee reserves. We will accelerate the construction of government- deployable coal reserve capacity to more than 200 million tons, add gas storage facilities of more than five billion cubic meters, increase the electricity supply of pre-emergency and peak-shaving plants to more than 300 million kilowatts, and guide major energy production enterprises and large energy consumers to strengthen their consciousness of social responsibility.
Third, we will intensify our efforts to ensure a stable supply and stable prices. We will give full play to the role of medium and long-term energy contracts and achieve full coverage of medium and long-term contracts for coal, electricity, and gas services in key areas related to people's livelihood and economic development. We will help keep coal prices running within a reasonable range and improve the transmission mechanism of coal and electricity prices.
We will make efforts to ensure that people's basic energy needs are met. Although we are guaranteed with reliable energy supply capacity, with the significant increase in the proportion of unstable power sources, such as climate-vulnerable wind power and photovoltaic plants, residents and enterprises have higher and higher requirements for reliable energy to meet their living and production needs. Through a larger margined, more secure, and more reliable supply guarantee plan, we will ensure energy security and supply in all situations. We will ensure that there will be neither electricity nor gas rationing unless in extreme cases, and even if there's an extreme case, the switches and valves will not be turned off. Supported by the above comprehensive measures, we will ensure the security and reliable supply of energy in China and reassure our people and all energy users.
Thank you.
Reuters:
China set a 5.5% GDP growth target for this year, which is believed by many analysts as a bit difficult to achieve and may require much stronger policy support. What's your take on that? Also, do you have fears of the negative effects of stimulus policies, for example, lower investment efficiency, excess capacity, and possible risks of an asset bubble? In addition, what is the impact of the Ukraine crisis on the Chinese economy and the Belt and Road Initiative (BRI)? Thank you.
Lian Weiliang:
Thank you for your questions. Premier Li Keqiang made a thorough explanation on this year's growth target and the measures to achieve it. The government work report emphasized that the target of around 5.5% represents a medium-high growth rate from a large base figure and demonstrates the country's ability to move proactively. Achieving this goal will require arduous efforts.
NDRC Chairman He Lifeng also expounded on ways to achieve the GDP growth target as he joined the "minister aisle" interview on the sidelines of the ongoing "two sessions." We are well poised to achieve this year's target. We have ample room for development, which is created by implementing the new development philosophy, building the new development paradigm, and promoting high-quality development. We have also accumulated practical experience in driving high-quality development against the backdrop of the COVID-19 pandemic. Particularly, we have an effective policy mix, including prudent and effective macro policies, micro policies that continuously stimulate the vitality of market entities, structural policies that ensure smooth flow of economic activity, policies in the sci-tech sector that energize innovative potential, reform and opening-up policies that drive development, policies that promote more balanced and coordinated regional development, as well as social policies that meet people's basic living needs.
More importantly, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, we have accumulated rich experience in developing new ways to improve macro regulation as we address various risks and challenges. We have both macro-policy tools and space available to us, and we used them to intensify cross- and counter-cyclical adjustments. We did not adopt a deluge of strong stimulus policies but paid attention to the precision, efficiency, and sustainability of policies. While making sure we achieve the growth target, we effectively avoided problems such as lower investment efficiency, excess capacity, and asset bubble.
This year, we will work on the following three aspects to achieve the GDP growth target. First, we will pay more attention to the implementation of major decisions, issue more policies and measures to further expand domestic demand, and strive to maintain the sound development momentum of foreign trade. Second, we will enhance the coordination of macro policies in order to unleash their combined role in stabilizing growth. In particular, we will strengthen the assessment and analysis of newly issued policies in order to accelerate policies that contribute to economic stability and keep an eye out for policies that work otherwise. Third, we will attach more importance to addressing various risks and challenges, and ensuring food security, energy security, and the stability of industrial and supply chains. We will also work on pandemic control in a more precise manner.
As to the possible impact of the Russia-Ukraine conflict, we are paying as much attention as you do. The conflict brings more uncertainty to global economic development. I want to emphasize that the Chinese economy has strong resilience, ample potential, and adequate space for development. Though the external environment is becoming more complicated, the fundamentals underpinning China's long-term growth remain sound. China is still able to keep its major economic indicators within the appropriate range. Regarding the BRI, both Russia and Ukraine are participating countries of the initiative. China will work along with all participating countries of the Belt and Road, including Russia and Ukraine, to promote the high-quality development of the Belt and Road in the Silk Road spirit of peace and cooperation, openness and inclusiveness, mutual learning, and mutual benefit. We also look forward to seeing the concerned parties peacefully resolve the issues through dialogue, and minimize the conflict's impact on the world economy.
Thank you.
_ueditor_page_break_tag_Economic Daily:
The internal and external environment that China faces has undergone significant changes. The Central Economic Work Conference held last year underlined the smooth operation of the industrial chain. Can you please introduce the efforts on maintaining the security and stability of industrial and supply chains and what new measures will be taken in the future? Thanks.
Lin Nianxiu:
Maintaining the security and stability of industrial and supply chains is a strategic requirement of building the new development paradigm. It also matters to China's long-term development and security. The CPC Central Committee and the State Council attach great importance to the security and stability of the industrial and supply chains. General Secretary Xi Jinping has made important instructions on numerous occasions, pointing out the direction and providing the fundamental principles for us. In recent years, the NDRC has worked along with other departments to earnestly implement decisions and policies of the CPC Central Committee and the State Council, shored up the industrial economy, resolved impediments to industrial development, and smoothened economic circulation. This has contributed to a much stronger resilience of industrial and supply chains and increased our capability of maintaining the security and reliability of industrial and supply chains. This can be seen in the following four aspects.
First, a more stable operation. The industrial economy continued to develop steadily. In 2021, industrial added value above the designated size rose 9.6% year on year. Key industries and sectors maintained stable operation. We managed to maintain the supply and steady the prices of commodities and raw materials, effectively guarding against the impact brought to industrial and supply chains by undue fluctuations in prices.
Second, a better structure. We made breakthroughs in key and core technologies, achieving unprecedented results and making major improvements in a number of sectors. Companies generated more vitality and improved their cost-effectiveness. A number of outstanding companies and key equipment have become a calling card of China. A batch of small and medium-sized companies with high growth potential, advanced technology, strong market competitive edges as well as single-product specialists emerged more quickly and showed a promising outlook. Strategic emerging industrial clusters with unique characteristics and complement each other develop and thrive nationwide, adding to the efforts of maintaining stable industrial and supply chains.
Third, stronger development momentum. Industrial sectors amassed great momentum in transformation, upgrading and technological innovation. In 2021, China's high-tech industry saw its investment rise 17.1% year on year, 12.2 percentage points higher than that of investment in general. The manufacturing industry saw its investment in technological transformation rise 13.6% year on year, higher than the growth rate of overall investment in the manufacturing industry, adding new impetus to improving industrial and supply chains.
Fourth, stronger competitiveness. China's exports and global market share created record highs. In 2021, the export delivery value of industrial enterprises rose 17.7% year on year. China's 5G network facilities and applications led the world. The production and sales of new energy vehicles topped the world for seven consecutive years. The production of photovoltaic modules accounted for more than 70% of the world's total. Power transmission and transformation and rail transit already led the world. Industries with strong competitiveness continued to grow, and they have taken up a much better position in global industrial and supply chains.
We should also be keenly aware that facing the complex and volatile international environment and domestic conditions, we still face multiple difficulties and challenges in keeping industrial and supply chains safe and stable. This year's work requires extraordinary efforts from us. Next, the NDRC will work with related departments to take effective measures to keep industrial and supply chains secure and stable. We will continue our major work in five aspects as follows:
First, we will continue to shore up weaknesses. The amount of water a bucket can hold is determined by its shortest plank. Major weak links in industrial chains always hinder the healthy development of the economy. We will focus on key areas concerning the economy, people's wellbeing, as well as strategic and security matters. Dealing with bottleneck problems will be our focal point. We will coordinate the efforts to strengthen weaknesses, promote iterative applications, improve the industrial ecology, and make breakthroughs in key and core technologies. We will implement projects for rebuilding industrial foundations, strengthen weaknesses in basic industries, and cement the foundation for industrial and supply chains.
Second, we will continue to build up and harness our strengths. Our strength maintains the core competitiveness and a powerful and effective tool for industrial competition. We should work to build up our strength. First, we will expand strength in upgrading traditional industries. We will step up efforts to implement the Five-Year Action Plan on Enhancing Core Competitiveness in the Manufacturing Sector. We will increase competitive edges throughout the complete industrial chains and in major areas. Second, we will increase strength in fostering emerging industrial chains. We will seize the opportunity to develop cutting-edge industries and deepen our efforts to develop national strategic emerging industrial clusters. Efforts will be made to accelerate the development of new industries, new business forms, and new models.
Third, continue to eliminate bottlenecks and restrictions. Smoothing economic circulation is the key to stabilizing industrial and supply chains. At present, we will focus on solving the chip shortage problem in the automobile and other manufacturing industries. Last year, due to multiple reasons, there was a global shortage in chips supply, which we will tackle this year. We will continue to ensure the stability of supplies and prices for bulk commodities and raw materials; improve the production, supply, storage, and marketing systems; and strengthen effective supervision of futures and spot markets. We will also carry out projects to link the industrial and supply chains in key fields; set up industrial coalitions in collaborative R&D, product development, and experimental verification; and rely on leading enterprises to guarantee and stabilize industrial and supply chains.
Fourth, we will continue to deepen opening-up and cooperation. We will support the development of cross-border e-commerce and overseas warehouses and promote the efficient operation of industrial and supply chains in the foreign trade sector. We will make better use of foreign investment, encourage foreign-invested enterprises to expand investment in high-end manufacturing and high-tech fields, and support the innovative development of foreign-funded R&D centers. We will also implement regional trade agreements such as RCEP, make good use of various multilateral mechanisms, and establish a mutually beneficial cooperation system for industrial and supply chains.
Fifth, we will continue to strengthen risk prevention. We will establish a risk monitoring system for industrial and supply chains and improve mechanisms for risk assessment, early warning and response so as to enhance our capability to identify and accurately handle risks. We will tighten all parties' responsibilities and strive for early detection, reporting, assessment, and response of risks in order to guarantee the stable operation of industrial and supply chains. Thank you.
_ueditor_page_break_tag_Beijing News:
In recent years, due to a rapidly increasing elderly population and gradually increasing costs of raising children, many Chinese people feel the pressure of having to take care of both. What policies will be taken to expand the supply of elderly care and child care services? Thank you.
Lian Weiliang:
Thanks for your question. Elderly care and child care are the most popular issues currently concerning people's livelihoods, with topics such as aging population, the three-child policy, and taking care of elderly and young children frequently trending on the internet. The CPC Central Committee and the State Council have attached great importance to this issue. General Secretary Xi Jinping emphasizes that we should pay high attention to solving the problem of elderly care and child care, accelerate the system of services for the elderly, and support social forces to develop public accessible child care services. In this year's government work report, unveiled during the ongoing "two sessions," Premier Li Keqiang emphasizes the need to improve elderly care in urban and rural areas and publicly-accessible child care services. Increasing the effective supply of elderly care and child care services will be a key task for this year's economic and social development. In this regard, we will focus on three aspects: improving both quantity and quality, ensuring accessible and nearby services, and exercising strict supervision and regulation.
First, we will improve both the quantity and quality of care. At present, the social demand for elderly care and child care, especially high-quality services, is very urgent. By the end of the 14th Five-Year Plan period (2021-2025), there will be more than 9 million elderly care beds and over 6 million nursery positions for infants and young children in the country. We will expand the scale of high-quality resources to meet the public's needs. For those nursing homes and nursery institutions where it is hard to find a bed or position, the central government budgetary investment will give key support. Relevant policies including fiscal and taxation, credit, land, and talents will be implemented so as to greatly increase the high-quality resources supply of elderly care and child care services.
Second, we will ensure accessible and nearby services. After years of development, the total number of nursing homes and elderly care beds has increased significantly. However, the utilization rate of some beds is not high. Apart from the epidemic impact in the past two years, another important reason has been the mismatch between supply and demand or the lack of precise and quality supply. The public's most needs are affordable, convenient, accessible, and nearby services. Therefore, the focus of improving both quantity and quality is to ensure accessible and nearby services. Accessible means that the government should give greater policy support to help service agencies reduce costs and then lower prices for consumers. Nearby means to fully implement the requirements of providing elderly care and child care services in communities. At the same time, we will guide all kinds of elderly care and child care services to extend to communities and families.
Third, exercising strict supervision and regulation. The quality and reliability of elderly care and child care services are currently the most concerning problem. At present, there are indeed a number of problems in this regard. For example, some institutions provide low-quality services but charge unreasonable fees, which brought about consumer complaints. Some institutions lack integrity, or even cheat the elderly out of their money and then make off, which seriously impacts the bottom line of social morality and law. To prevent this, we will strengthen the coordinated supervision and regulation and further optimize standards and norms so as to comprehensively improve the service quality and level of elderly care and child care.
After the epidemic, China will witness a recovery and rapid growth of elderly care and child care services, which ask us to fully prepare for and increase its effective supply. Thank you.
Xinhua News Agency:
Since the outbreak of the epidemic, relevant departments have adopted a series of policies to boost consumption. However, the recovery of consumption is still relatively slow. How do you forecast the consumption situation this year? What other policies will be adopted to promote consumption? Thank you.
Lian Weiliang:
Mr. Hu will answer questions about consumption.
Hu Zucai:
Thanks for your question. Consumption is the final demand, the lasting driving force behind economic growth, as well as an important guarantee to meet people's growing needs for a better life. The CPC Central Committee and the State Council have attached great importance to this issue. We have steadfastly implemented the strategy of boosting domestic demand, carried out a series of policies and measures to promote consumption in an orderly manner, and consolidated the fundamental role of consumption in economic development.
In 2021, sporadic COVID-19 cases were reported in China, which affected consumption a lot. We earnestly implemented the decisions and plans of the CPC Central Committee and the State Council, coordinated pandemic prevention and control with socioeconomic development, and promoted the improving and upgrading of consumption, which have boosted its recovery. China's retail sales of consumer goods totaled 44.1 trillion yuan last year, up 12.5% year on year, with final consumption expenditure contributing 65.4% to full-year economic growth. Driving GDP growth by 5.3 percentage points, China's consumption has re-established itself as the biggest driver of economic growth. At the same time, there are many new hotspots and highlights in the consumption sector. For example, online consumption bucked the trend and grew, and the online sales increased 14.1% year on year. The development of green consumption accelerated, with sales of new energy vehicles increasing 160% year on year. The demand for upgrading consumption became stronger, with retail sales of sports and fitness consumer goods maintaining double-digit growth. Thanks to the momentum from the Beijing 2022 Winter Olympics, the consumption of ice and snow sports-related products continues to grow. Since January, online sales of ski suit and skiing equipment increased by 110.7% and 61.6%, respectively.
China enjoys a huge domestic demand market, with a population of over 1.4 billion and the world's largest and fastest-growing middle-income group. Last year, China's per capita GDP reached around 12,500 U.S. dollars, which is close to the threshold of the World Bank's standard for high-income countries. With the steady increase in personal income, a huge demand for upgrading consumption will emerge, and the momentum of sustained growth in consumption will remain unchanged. At present, consumption is getting more diversified, personalized and high-quality, and intelligent, green, and healthy consumption has become a new trend for residents. The strong domestic market provides solid support for the fostering of a new development dynamic, with the domestic economy and international engagement reinforcing each other and the former as the mainstay. However, due to the epidemic and other factors in the past two years, consumption of some of the services that entail face-to-face contact, population movements and gathering of people has been seriously affected. Last year, the passenger volume in China dropped 14.1% year on year, and the number of domestic tourists and the domestic tourism revenue only recovered to 54% and 51% of that of 2019, respectively. Therefore, the task to promote sustained recovery of consumption is still arduous.
This year's government work report made comprehensive deployments for boosting consumption in 2022. The NDRC will firmly implement the strategy of boosting domestic demand, further unleashing consumption potential, and taking multiple measures to promote sustained recovery of consumption on the basis of targeted and effective epidemic prevention and control. We will focus on the following aspects.
First is to enhance consumption capability. We will strengthen pro-employment policies, implement measures to stabilize employment, support innovation and business startups in creating jobs, and provide targeted employment support for key groups so as to increase workers' incomes through fuller and higher-quality employment. We will further improve social security, optimize income distribution structure, increase incomes of low- and middle-income groups, and further expand the middle-income group, which will lay a solid foundation for expanding consumption.
Second, we will cultivate new growth areas of consumption. We will better meet the needs of conducting pandemic prevention and control on an ongoing basis, actively develop online consumption, and promote the deep integration of online and offline consumption. We will also cultivate and expand new consumption forms and models such as smart retail, smart tourism, digital culture, and smart sports. We will vigorously develop ice and snow tourism and ice and snow consumption, and promote the implementation of the action plan for the development of ice and snow tourism. We will work harder to promote the consumption of services such as nursing care for the elderly and children, and develop elderly-friendly technologies and products and products safe and healthy for infants. We will upgrade and expand domestic services. And we will further expand county- and township-level consumption, and speed up the integration of e-commerce and express delivery systems in counties, townships and villages. At the same time, we must implement relief and assistance measures to support industries in difficulties, such as catering, retail, tourism, and transportation; promote recovery in consumption of consumer services; and steadily increase major consumption.
Third, we will vigorously develop green consumption. We will fully carry out the implementation plan for promoting green consumption recently issued by the NDRC. On the one hand, we must promote the expansion of the supply and consumption of green and low-carbon products. We will comprehensively promote green and low-carbon building materials, continue to support the consumption of new-energy vehicles, and encourage local governments to promote spending on green and smart home appliances in rural areas as well as the replacement of old home appliances. On the other hand, we will advocate a simple, moderate, green and low-carbon, civilized and healthy lifestyle and consumption model, and make green consumption a new fashion. We will enhance the national awareness of resource conservation, carry out in-depth food conservation campaigns such as the "Clear Your Plate" campaign, promote the greening, reduction, and recycling of commodity packaging and commodity distribution, and strengthen the recycling of waste and old materials.
Fourth, we will create a safe and secure consumption environment. We will optimize the urban consumption network under the framework of domestic circulation, promote the cultivation and construction of international consumption center cities, and promote the creation of regional consumption centers. We will improve community commercial supporting facilities, build a convenient urban living circle, and improve consumption infrastructure and service environment. We will strengthen the building of the consumer credit system and the quality standard system, improve the diversified consumer rights protection mechanism and dispute resolution mechanism, increase the quality and safety supervision of consumer goods, crack down on counterfeit and shoddy products, strengthen the protection of consumers' rights and interests, and strive to improve people's consumption experience and their willingness to consume. Thank you.
_ueditor_page_break_tag_Zhinews of Shenzhen Satellite TV:
In recent years, the NDRC has taken the lead in establishing a business environment evaluation system, and has carried out multiple rounds of evaluations, covering hundreds of cities across the country. What achievements and progress have been made in China's business environment assessment work? What are the priorities for optimizing the business environment this year? Thank you.
Lian Weiliang:
Mr. Lin Nianxiu, please answer the questions.
Lin Nianxiu:
Establishing a business environment evaluation system that conforms to China's national conditions and conducting business environment evaluation is an institutional arrangement made by the Regulations on Optimizing Business Environment. Since 2018, the NDRC has led the establishment of China's business environment evaluation system in accordance with the deployment of the CPC Central Committee and the State Council. So far, six batches of evaluations have been carried out. A total of 98 cities across the country have participated in the evaluations, covering 31 provinces, autonomous regions, and municipalities. In this process, we have formed three "1+N" working mechanisms in systems, indicators, and reports for optimizing the business environment, which have effectively promoted the optimization and upgrading of business environment nationwide.
Regarding these three "1+N" mechanisms, the first is the system "1+N". "1" is China's "Regulations on Optimizing Business Environment", and "N" is the supporting regulations and policies issued by various regions. For the indicator "1+N", "1" is the evaluation indicator system of China's business environment, including 18 major items and 87 small items, and "N" is the indexes added by local governments in accordance with local situations. As for the report "1+N" mechanism, "1" is the "China Business Environment Report" issued by the NDRC every year, and "N" is the local self-assessment reports. Each region has carried out targeted reforms in line with the national indicator system. At present, 28 provinces, autonomous regions and municipalities have formulated local regulations. Many cities' plans for optimizing business environment have been upgraded from version 1.0 to version 5.0, while all regions are showing enormous enthusiasm to compete with each other to optimize their business environment.
You all know that business environment is the soil for the survival and development of enterprises, and the quality of the "soil" is directly related to the vitality of market entities and the driving force of economic development. The NDRC will conscientiously implement the deployment of the CPC Central Committee and the State Council, focus on key points, continue to make efforts, and strive to create a market-oriented, law-based, internationalized, and convenient top-class business environment to better cultivate and stimulate the vitality of market players. To sum up, the next key measures can be summarized in five words, namely, "fairness, justice, openness, convenience, and satisfaction."
Fairness means continuing to relax market access, allowing enterprises to enter and compete on an equal footing. We will focus on implementing list-based management and fully implement administrative systems such as the negative list for market access and the list of items requiring administrative licensing. The most urgent task is to speed up the removal of hidden barriers in the market, break down the "glass door", clean up and abolish regulations and practices that hinder a unified market and fair competition, and ensure that various market players can equally use various production factors and public service resources in accordance with the law.
Justice means implementing scientific and effective supervision, enhancing corporate investment confidence, and stabilizing market expectations. We will focus on promoting the "three meticulous implementations." The first is to meticulously implement the "Regulations on Optimizing Business Environment" and solve the "last-mile" problems in the implementation of laws and regulations. The second is to meticulously implement supervision system rules, strictly regulate administrative law enforcement, and implement "double randoms, one disclosure" supervision (i.e. randomly select inspection objects and inspectors, and disclose the results timely), credit supervision, smart supervision, remote supervision, and mobile supervision. The third is to meticulously implement the regulations and procedures for formulating enterprise-related policies, allowing entrepreneurs to actively participate in policy formulation so that policy measures are more grounded, operational, and effective.
Openness means treating domestic and foreign enterprises equally and promoting the stable development of foreign investment and foreign trade. On the one hand, we will focus on the implementation of the Foreign Investment Law and supporting regulations, implement the catalog of industries that encourage foreign investment, and promote the implementation of major foreign investment projects. On the other hand, we will intensify our efforts to serve and guarantee foreign-funded enterprises and make every effort to coordinate and resolve the reasonable demands of foreign-funded enterprises so as to make China an attractive investment destination in the long run.
Convenience means improving the quality and efficiency of government services and making it more convenient and efficient for enterprises and the people to proceed with their businesses there. The emphasis is on "three pushes". The first is to push forward the quality and efficiency of window services, enhance the "one-stop" service function at government service halls, and promote the integrated handling of more government affairs. The second is to push forward the deep integration of online and offline services, and strengthen the coordination between the physical government service hall and the online government service platform, so as to facilitate enterprises and the people to handle their procedures there. The third is to push forward the optimization of the technology empowerment process, develop more digital service scenarios, and realize a broader range of online and cross-province one-stop services.
Satisfaction means playing the role of evaluation in guidance and supervision, stimulating local governments to introduce stronger and more practical measures recognized by market entities. Whether the business environment is good enough should be judged by enterprises. We will continue to improve the evaluation mechanism that focuses on the satisfaction of market players and the public, promote the evaluation of China's business environment in an orderly manner, guide and support more cities to make up for their shortcomings and weaknesses in line with advanced practices, and actively carry out reforms and innovations. For example, we will introduce a new measure to establish a "collection and notification system for cases that damage business environment." We will collect the problems that damage the business environment in different places and take the collected problems and rectification progress as an important part of China's business environment evaluation so as to promote solutions one by one. Thank you.
Market News International:
The conflict between Russia and Ukraine continues to escalate, and international oil and gas prices continue to rise further. Does China have any plans to ensure the supply of energy? Will you consider increasing imports? What are the appropriate import channels that China can utilize? Thank you.
Lian Weiliang:
Thank you for your questions. The recent escalation of the conflict between Russia and Ukraine has had an impact on the global energy market, and international crude oil and natural gas prices have risen greatly. Due to the high proportion of China's crude oil and natural gas being from outside its border, we will definitely be affected, and the import cost will rise. But overall, the impact is controllable. This is because, on the one hand, China is a big energy consumer and also a big energy producer, so the overall energy supply is guaranteed. The sources of China's crude oil and natural gas imports have been diversified, and long-term contracts account for a high proportion. As long as all parties comply with the contracts, imports can remain generally stable. At the same time, China is vigorously promoting the high-quality development of renewable energy and accelerating the implementation of renewable energy substitution. The rapid increase in clean energy will also effectively hedge and mitigate external impacts. In the past year, the proportion of clean energy in our total energy consumption has increased by 1.2 percentage points; in the national power generation in the past year, the proportion of power generation from wind power and photovoltaics increased by 2.2 percentage points. In addition, our current CPI is at a low level. Just now, Mr. Hu Zucai introduced the situation. We will take comprehensive measures to alleviate the impact of imported inflation.
As for how to ensure energy security and stabilize supply, we will make efforts in the following four aspects, as I mentioned just now. This includes expanding production capacity, increasing energy reserve, ensuring supply and stabilizing prices, and resolutely working to meet people's basic living needs of energy. These measures center on two keywords, namely "increasing" and "stabilizing." We need to increase the capacity and volume of production, the reserve, and the supply of energy. In the meantime, we also need to stabilize energy imports, prices, and relevant expectations. With the implementation of these measures, we have the confidence to ensure energy security and reliable supply, and meanwhile promote the green and low-carbon transformation of energy in an orderly manner.
Thank you.
_ueditor_page_break_tag_21st Century Business Herald:
The Report on the Work of the Government notes that China will continue expanding effective investment this year. In this regard, new infrastructure is one of the key aspects. For example, the east-to-west computing resource transfer project launched in February has caught the attention of many market players. What progress has China made in the construction of new infrastructure facilities? What are the key tasks this year? Thank you.
Lian Weiliang:
Mr. Lin will take these questions.
Lin Nianxiu:
Accelerating the construction of new infrastructure facilities is a major decision made by the CPC Central Committee and the State Council, and also a key task stipulated in the Outline of the 14th Five-Year Plan (2021-2025) for National Economic and Social Development. It is of paramount significance to the promotion of the digital transformation of economy and society and realizing high-quality sci-tech self-reliance. The new infrastructure we proposed mainly consists of three categories concerning information technologies, integrated development, and sci-tech innovations. In recent years, the NRDC has worked with relevant government bodies to carry out a series of projects focusing on these three categories. We have seen sound progress and made new achievements in the following three aspects.
First, a new development foundation has been built for the digital economy. In recent years, China's construction of information infrastructure has sped up remarkably. We established the world's largest and most advanced network of information and communication. China's 5G network has covered all of its prefecture-level cities, the majority of counties, and most townships and villages. The gigabit fiber-optic networks have been rolled out across the country, which is able to cover 300 million households. The overall layout for the national integrated big-data center system has also been completed. Since 2021, the NDRC has approved the construction plans of eight national computing hubs and has comprehensively launched the east-to-west computing resource transfer project. The project aims to give full play to the respective advantages of the east and west regions and translate the demand for computing capacity in the east into a growth momentum in the west so as to further realize nationwide coordination of energy and computing capacity. The civil space infrastructure has also witnessed rapid development. Currently, China's remote-sensing satellite system has realized global observation. In major fields, the self-sufficiency rate of data collected by domestic satellites exceeds 90%.
Second, new pillars have been created to support high-quality development. Regarding the construction of infrastructure that promotes integration, China's capacity of using information technologies has been greatly enhanced in advancing the intelligent transformation of traditional infrastructure facilities, facilitating economic upgrading and transformation, and improving people's livelihood. For instance, in terms of smart transport, we have seen remarkable progress in the intelligent transformation of ports and freeways. Digital map achieved full coverage, and the e-tickets have been rollout out comprehensively. Electronic waybills have been applied to more than 90% of express delivery services. People's traveling experiences and other logistic services have been greatly facilitated. In terms of the intelligent transformation of the energy sector, China introduced the world's first high-reliability 5G network for coal mines. After renovation, these coal mines have extensively adopted unmanned operating systems, and the number of employees working at high-risk posts has been reduced by more than half. This has effectively safeguarded people's possessions and lives. In terms of industrial internet, more than 2,000 "5G plus industrial network" projects have been carried out across China, which became a crucial pillar supporting the recovery of work and production and maintaining stability of industrial and supply chains. To sum up, 5G network not only facilitates online shopping activities but also improves the efficiency of industrial manufacturing and makes it more intelligent.
Third, new advantages have been fostered for high-level self-reliance. Since the 18th CPC National Congress, China has made many breakthroughs in the innovation of infrastructure. In terms of the number of projects, China has already made plans and established a total of 57 major sci-tech infrastructure facilities. With a group of high-level infrastructure projects set to be built in the next five years, the number of large-scale infrastructure projects in China will rank among the top globally. Compared with the rest of the world, China's major sci-tech infrastructure has seen remarkable improvement. We were mostly left behind five years ago, but the gap nowadays keeps narrowing down, and we have even become a world-leading force in certain fields. For instance, our Five-hundred-meter Aperture Spherical Radio Telescope (FAST), also dubbed the "China Sky Eye," has made many important astronomical discoveries. China's experimental advanced superconducting tokamak (EAST), or the Chinese "artificial sun," has achieved a reproducible, stable, and continuous plasma operation for the first time. It achieved a plasma temperature of 120 million degrees Celsius for 101 seconds, which is truly remarkable.
Regarding the application of sci-tech achievements, a group of strategic industrial technologies has been developed in recent years, and a number of major issues associated with society and people's livelihood have been addressed. For example, the Shanghai Synchrotron Radiation Facility has explored new solutions for the efficient use of natural gas and shale gas, which provides a strong basis for our future exploitation work of the two resources. The Heavy Ion Research Facility in Lanzhou has developed a heavy ion device for cancer treatment, which is a major breakthrough in high-end medical instruments. In this sense, these seemingly highly-advanced major sci-tech infrastructure facilities are actually closely associated with us and are profoundly changing the way of production and life.
The Central Economic Work Conference for 2022 proposed that infrastructure investment should be implemented in advance in a moderate manner. In accordance with relevant arrangements and requirements, the NDRC will ramp up efforts in the following three aspects:
First, the NDRC will speed up the construction of projects in major fields. To begin with, efforts will be made to accelerate the improvement of internet facilities. We will work to carry out the project that improves basic internet facilities in small and medium-sized cities in central and western China as well as the demonstration projects featuring 5G integration and application. By doing so, we can narrow the digital divide and strengthen weak links in application. We will also unify the efforts in rolling out the construction of node-like facilities. We will accelerate the building of ten national data center clusters and implement, in a stable and orderly manner, the construction of the new National Internet Exchange Center and key junctions of direct internet connection. In addition, we will deploy forward-looking facilities in advance. We will accelerate the efforts to implement the preparatory work of projects, speeding up the launch, execution and construction of major sci-tech infrastructure projects that are stipulated in the 14th Five-Year Plan. We will also launch a group of pre-research projects in a timely manner and continuously enhance China's capacity of the original innovation.
Second, the NDRC will fully mobilize the initiative of investment among market entities. We need to make sufficient efforts in three aspects. For starters, we will leave enough room for private capital. Since new infrastructure facilities are invested and established mainly by market entities, we will further expand market access and lower the entry threshold of investment in a bid to fully leverage the role of private capital in the sector. We will also provide sufficient policy support. We will boost credit support for the construction of new infrastructure, innovate financial tools, and expand the channel of financing, providing more favorable conditions especially for private businesses that participate in the construction of new infrastructure. In addition, we will ramp up efforts to accelerate the reform in relevant sectors, support enterprises to carry out technical and business model innovation, create a market environment featuring fair competition, and foster new growth momentum for the economic and social development.
Third, we will realize our carbon peak and neutrality goals and advance green development. The period covered by the 14th Five-Year Plan will be the first five years since China set its carbon peak and neutrality goals. In line with the deployment of the CPC Central Committee and the State Council, the NDRC issued an implementation plan for the green and high-quality development of new infrastructure such as data centers and 5G at the end of last year. The implementation plan made comprehensive arrangements for improving computing power and energy efficiency, optimizing energy-saving models, facilitating innovations in energy efficiency technology, and promoting economic transformation and upgrading. We will focus on the plan and step up efforts in energy conservation and emission reduction in the next step. In terms of energy conservation, we will support breakthroughs in high-efficiency energy conservative technologies, improve energy efficiency standards for ultra-large data centers, and carry out demonstration projects for energy-saving in 5G networks. In terms of emission reduction, we will promote the coordinated development of 5G facilities, computing resources, and renewable energy, support the transfer of more data centers to the western regions rich in renewable energy, and gradually reduce carbon emissions while increasing the supply of computing capacity. Thanks!
China Development and Reform News:
My questions are about new urbanization. According to the 2021 statistical communiqué, China's urbanization rate of permanent residents registered 64.72%. Will the previous rapid growth rate be sustained? What are the key tasks for new urbanization this year? Thanks.
Hu Zucai:
Thank you for the questions. Urbanization is essential for modernization and holds the greatest demand potential in China. It plays a vital role in promoting steady and healthy economic and social development, fostering a new development paradigm, and building shared prosperity. General Secretary Xi Jinping emphasized that a uniquely Chinese approach to urbanization will continue to guide the people-centered new urbanization process. Over the past year, we have implemented the plans of the CPC Central Committee and the State Council and achieved fresh progress in new urbanization. Improvements have been made in five aspects.
First, the level and quality of urbanization have steadily improved. By the end of 2021, China's urbanization rate of permanent residents reached 64.72%, and the rate of the registered population rose to 46.7%, a year-on-year increase of 0.83 and 1.3 percentage points, respectively. The gap between the two rates narrowed for the first time since the 13th Five-Year Plan period. Second, the provision of public services for migrant workers has steadily improved. We worked across the board to ensured that children living with their migrant worker parents in cities have access to compulsory education. As a result, 81.8% of such children studied at public schools of mandatory education, increasing 1.8 percentage points over the previous year. When considering those studying in private schools with their tuition fees covered by the government, the figure was 90.9%, a year-on-year increase of 5.1 percentage points. In addition, we organized extensive vocational skills training for rural migrant workers. Third, the carrying capacity of city clusters and metropolitan areas has steadily improved. Solid progress has been made in the coordinated development of the Beijing-Tianjin-Hebei region, the integrated development in the Yangtze River Delta, and the development of Guangdong-Hong Kong-Macao Greater Bay Area. The development of the Chengdu-Chongqing economic circle maintained powerful momentum. The development of city clusters in the middle reaches of the Yangtze River picked up the pace. Plans for developing metropolitan areas, including Nanjing, Fuzhou, and Chengdu, were issued. Fourth, the quality of urban development has steadily improved. We began the renovation of 56,000 old urban residential communities and accelerated the development of elderly and child care service systems. Fifth, the integrated development of urban and rural areas has steadily improved. As a result, the gap between urban and rural areas has been narrowed. The ratio of urban income to rural income per capita dropped to 2.5 from 2.56 in the previous year.
At present, China's urbanization is already in the middle and late stages of rapid development and entering a new stage of comprehensive quality improvement. Nevertheless, the driving force behind urbanization is still strong, promising substantial domestic demand and development momentum. We will advance a new people-centered urbanization strategy featuring high-quality development for some time to come. This year, we will steadily improve the quality of new urbanization and fully play its role in stimulating consumer spending and effective investment. We will focus on the following four aspects.
First, we will improve residency status for rural migrants who were granted permanent urban residency, which is the top priority of urbanization. We will continue deepening the reform of the household registration system, widening channels for rural migrants who have stable jobs and have lived in urban areas for a long time to gain urban residency, and at the same time protect their rights in rural areas. We will move faster to ensure that all urban residents access essential public services. With the new generation of migrant workers as the focus, we will ensure that children who moved from rural to urban areas along with their parents receive compulsory education. We will also improve employment service and vocational skills training. In 2022, we plan to offer at least 6 million subsidized training opportunities for migrant workers.
Second, we will promote the coordinated development of large, medium-sized, and small cities and towns. We will transform the development model of megacities. These cities should solve urban maladies; relieve their central areas of non-essential functions; appropriately control the scale, development intensity, and population density; promote multi-center, multi-level, and cluster development; and drive the growth of surrounding cities and counties to form a modern metropolitan area. We will advance the integrated development of urban clusters and metropolitan regions; accelerate the construction of highly connected rail transit in the Beijing-Tianjin-Hebei region, the Yangtze River Delta, and Guangdong-Hong Kong-Macao Greater Bay Area; promote the development of Chengdu-Chongqing economic circle; move faster to build modern metropolitan areas; and release development plans for Changsha-Zhuzhou-Xiangtan, Xi'an, and Chongqing metropolitan areas. We will promote county-level urbanization by supporting a group of counties with favorable conditions to speed up development and taking targeted measures to shore up weak links in counties. We will better meet the growing demand of rural residents to work and settle in counties. We will improve urbanization in border areas and promote characteristic towns' standardized and healthy development.
Third, we will improve livability and working conditions in cities. China's urban population has exceeded 900 million, and the number is expected to increase year by year. Therefore, we should make our cities more attractive and function better. We will create high-quality living spaces and provide more inclusive and convenient public services for urban residents. We will increase the supply of education, healthcare, childcare, elderly care, domestic, sports, and public culture services and create 15-minute community-life circles. We will promote urban renewal in an orderly manner, improve public facilities to cope with storms and droughts, initiate the upgrading of urban pipelines, including those for gas supply, improve living conditions for 8.4 million households living in old residential areas and increase urban safety and resilience. We will pay more attention to the urban ecological environment and support Chengdu in building into a demonstration park city that follows the new development philosophy. We will strengthen the conservation of historical and cultural heritage, put an end to large-scale demolition for grandiose projects, and prohibit large-scale migration and felling of old trees.
Fourth, we will drive the integrated development of urban and rural areas. Even when China basically achieves its urbanization goal, around 400 million people will still live in rural areas. We will take coordinated measures to promote urban and rural modernization, channel more urban public services to rural regions by taking counties as the basic units, promote the extension of urban utilities to rural areas according to local conditions, advance modernization of agriculture and rural areas, and provide a better living environment for rural residents. Thank you.
_ueditor_page_break_tag_Shanghai Securities News:
China still faces some difficulties and challenges in developing the real economy. What measures will be taken to promote the high-quality development of real-economy sectors, including a new type of real economy-based enterprises? Thank you.
Lin Nianxiu:
The real economy is a cornerstone of our country and a wellspring of wealth. Attaching high importance to the real economy, General Secretary Xi Jinping gave important instructions on various occasions, pointing the way forward and providing guidelines to carry out related work.
Through years of effort, major advances have been made in China's real economy in terms of size, scale, structure, and quality, which is an outstanding achievement in the world's history. Our added value of the manufacturing sector has ranked top worldwide for 12 consecutive years. China has become the world's largest producer of over 220 categories of industrial products, and the only country in the world to have all the industrial categories listed in the United Nations' industrial classification. The influence of Chinese manufacturing on global industrial and supply chains has been increasing. All these are the biggest source of inspiration that will enable us to achieve the transformation from a major economy to an economic powerhouse.
However, compared with the world's industrial powerhouses, there are still some deficiencies and weak links in our work on developing the real economy, that have caused us to fall short of the requirements of high-quality development. To accelerate remedying these deficiencies, we will double our efforts and take coordinated action that covers all sectors and focus on two priorities to promote the high-quality development of the real economy.
The first priority is to continue boosting the industrial economy to increase the size of the real economy. The Central Economic Work Conference required us to seek steady progress in economic work this year. To stabilize the economy, I think we should first stabilize the industrial sector by maintaining its growth at a certain pace. At the end of last year, in accordance with the plans of the CPC Central Committee and the State Council, the NDRC worked together with relevant departments to issue an implementation plan to invigorate the industrial economy and promote high-quality industrial development. Recently, with the approval by the State Council, another document was issued on several policies for promoting steady growth of the industrial economy. In order to accelerate the implementation of relevant policies, the NDRC and the Ministry of Industry and Information Technology (MIIT) jointly held a national teleconference recently to make concrete plans to maintain the stable growth of the industrial economy. Next, relevant departments and local governments will continue efforts to implement the above two documents to ensure our policies bring benefits to enterprises as soon as possible and to promote the steady and healthy development of the industrial economy.
On the one hand, we will provide vital relief to businesses and reduce their burdens to help them survive and achieve better development. Enterprises are market entities. The stable performance of enterprises will help maintain market confidence with better economic prospects. To achieve this, we will truly ease the tax burden on businesses, strengthen financial support, and make an all-out effort to ensure supply and price stability of important raw materials and primary products. We will also stabilize the production and business operations of big enterprises, relieve the burden on small and medium enterprises, and increase the vitality of high-tech enterprises. By keeping market entities of all kinds fully motivated, we will boost market confidence as well as development expectations.
On the other hand, we will invigorate enterprises by solid investment and strengthen the basis for sustained growth. Investment in manufacturing plays an important role in stabilizing current economic growth, as well as affecting future industrial structure and development momentum. With manufacturing investment high on our agenda, we will work to facilitate transformation in traditional industries and foster new growth drivers. Upholding a principle of ensuring all projects follow the planning and all production factors follow the projects, we will speed up preliminary work for major projects listed in the outline of the 14th Five-Year Plan and other major strategic planning to help them begin construction as soon as possible. You may have noticed that recently there have been a lot of major projects starting construction all over the country. Meanwhile, we will make efforts on the planning, reserve, and construction of major projects in various fields to help them become higher-end, smarter, more eco-friendly, giving full play to the key role of investment.
The second priority is to advance industrial restructuring to strengthen the quality of the real economy. To effectively carry out this year's economic work, we should remain committed to the general principle of pursuing progress while ensuring stability. Stability is the basis of our pursuit to further progress. In regard to the real economy, specifically, we will attach more importance to increasing its quality while keeping a certain growth pace. We will continue to promote industrial restructuring and move faster up to the medium-high end of the global value chain to realize high-quality development of our economy.
First, we will work to transform and upgrade traditional industries. Making full use of a dynamic domestic market, we will focus on traditional industries with enormous upgrading and market potential and step up efforts on technological transformation and equipment upgrading. We will expand supply based on good quality to better satisfy the needs of investment and upgrading consumption and ensure smooth flow of production, sale, and reserve. We will also promote industries with extensive energy consumption to conserve energy and reduce carbon emissions through transformation and upgrading, strengthen breakthroughs in and deployment of green technologies, and improve the level of technique in steel, non-ferrous metals, construction materials, and petrochemical industries.
Second, we will work to increase the core competitiveness of the manufacturing sector. We will take concrete actions to increase core competitiveness of the manufacturing industry, encourage enterprises to put advanced and applicable technologies into practical use, enhance equipment upgrading and large-scale applications of new products, and accelerate breakthroughs in and industrial application of core technologies in key areas, including new-energy automobiles and high-end equipment to develop new advantages over manufacturing competition. We will also support enterprises to improve brand-building, achieving a growing popularity and influence of Chinese brands.
Third, we will work to boost the integrated development of manufacturing and service industries. We will continue trials to integrate the development of advanced manufacturing and modernized services, guide local governments and enterprises to explore new models and a new path, review typical experiences and successful models and apply them on a broad scale. We will also optimize the allocation of production factors and resources, and improve the quality and efficiency of supply to support the development of high-quality manufacturing.
Xing Huina:
Today's press conference is hereby concluded. Thanks to the three speakers as well as our media friends. Goodbye.
Translated and edited by Wang Yiming, Wang Qian, Zhou Jing, Lin Liyao, Liu Sitong, Zhu Bochen, Zhang Rui, Zhang Liying, Li Huiru, Li Xiao, Wang Yanfang, Chen Xia, He Shan, Zhang Lulu, Jay Birbeck, David Ball and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Xiang Dong, deputy director of the State Council Research Office
Liu Rihong, director general of the First Department of General Research of the State Council Research Office
Song Li, director general of the International Department of the State Council Research Office
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
March 5, 2022
Shou Xiaoli:
Ladies and gentlemen, welcome to this briefing held by the State Council Information Office (SCIO). The fifth session of the 13th National People's Congress (NPC) opened this morning, and Premier Li Keqiang delivered the annual Report on the Work of the Government. To help the public better understand the report, we have invited Mr. Xiang Dong, deputy director of the State Council Research Office, to elaborate on the report and take your questions. We also have with us Mr. Liu Rihong, director general of the First Department of General Research of the State Council Research Office, and Mr. Song Li, director general of the International Department of the State Council Research Office.
First, we will give the floor to Mr. Xiang.
Xiang Dong:
Friends from the media, good afternoon.
This morning, Premier Li Keqiang delivered the Report on the Work of the Government to the fifth session of the 13th National People's Congress. Under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implementing the guiding principles of the19th National Congress of the Communist Party of China (CPC), all plenary sessions of the 19th Party Central Committee and the Central Economic Work Conference last year, the report reviews the major achievements and major tasks in promoting China's economic and social development in the past year, and puts forward the main projected targets, policy orientation and major tasks for 2022.
I have been reading media reports on the premier's work report and the public's reaction to it. Many NPC deputies and members of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) believe that the report is down to earth, displays foresight and strategic vision, and responds to the concerns of all sectors of society. Some say that they can feel much of the progress outlined in the report in their own lives. In the context of the ongoing pandemic and the complex and volatile global economic situation, the achievements in the past year have been particularly hard-won and made people proud. Some say that in the report, they found practical measures to address the key tasks of economic and social development and tackle the difficult issues that concern people, and that many packages of policies have also been introduced. They expressed stronger confidence in the future development of the country and greater hope for the new year. It can be said that the report fully implements the decisions and arrangements of the Party Central Committee and fully responds to social concerns. It is a pragmatic and inspiring report.
2022 is a very important year for the development of the Party and the country. The CPC will hold its 20th National Party Congress. Drafting the report was a key task, and the Party Central Committee and the State Council attached great importance to it. General Secretary Xi Jinping presided over meetings of the Standing Committee of the Political Bureau of the CPC Central Committee and the Political Bureau of the CPC Central Committee to discuss the drafting of the report, made important instructions on the drafting, and put forward specific requirements for further revisions and improvements, which provided fundamental guidelines for drafting and revising the report. The guiding principles for this year's work, policy orientation, and main goals and tasks proposed in the report were all drafted in accordance with the principles of the Central Economic Work Conference. Premier Li Keqiang presided over the drafting and revision of the report and chaired executive and plenary meetings of the State Council to discuss the draft. He also presided over several themed symposiums to directly hear opinions and suggestions from all parties. Li and other leading officials of the State Council also listened to opinions and suggestions through investigation and research in various places.
In accordance with the important instructions of General Secretary Xi Jinping on openly collecting suggestions and pooling wisdom, we have attached great importance to listening to and adopting the opinions of all sectors of society in drafting and revising the report. It can be said that the drafting is a process of gathering the wisdom and strength of the public, and also a process of meeting the expectations of society, and constantly refining and detailing the policy measures. In drafting the report, we solicited thousands of opinions and suggestions from multiple channels and took them under advisement:
First, Premier Li Keqiang presided over several symposiums to directly listen to opinions and suggestions. In late January, the premier presided over a symposium attended by experts and entrepreneurs, a symposium attended by representatives from the education, science and technology, culture, health, and sports sectors, a symposium attended by representatives from the central committees of non-Communist parties, the All-China Federation of Industry and Commerce, and non-party affiliated individuals. He conducted face-to-face exchanges and heard opinions and suggestions from people from all walks of life on a draft government work report.
Second, opinions from various regions and departments were extensively solicited. To collect opinions and suggestions, the draft report, discussed and revised at the plenary meeting of the State Council, was printed out and distributed in accordance with the procedures to all provinces, autonomous regions and municipalities, Party organizations, central government agencies, the military, people's organizations, some enterprises, and other entities. Thousands of opinions for revisions were collected, of which more than 300 important opinions were taken into consideration.
Third, media platforms were used to solicit opinions. For example, a campaign called "Share Your Ideas with the Premier" was launched for the eighth consecutive year to solicit suggestions from the public. The campaign was launched by www.gov.cn in cooperation with 22 online platforms, including people.com.cn and xinhuanet.com, as well as the websites of various provinces, autonomous regions and municipalities. People were invited to offer their opinions on 21 topics such as "employment and entrepreneurship," "enterprises and self-employed businesses" and "technological innovation." Nearly 1 million comments from netizens were received. The top five topics that received the largest amount of advice were: public affairs, social security and assistance, education, macroeconomics, and housing. The www.gov.cn carefully sorted through and selected more than 1,100 typical suggestions, and the report has taken some key advice.
In drafting the report, we have collected a large number of explicit comments and suggestions on almost every section and paragraph of the report. Regarding these opinions and suggestions, whether they came from local governments, departments, enterprises or ordinary citizens, the premier asked us to carefully sort through and summarize them and study them one by one, in a bid to better respond to the public's demands and gather wisdom from the whole of society.
This year's government work report is divided into three parts. The first part is a review and summary of last year's work and achievements. The second part expounds on the overall requirements, main projected targets and policy orientation for this year's economic and social development. The third part puts forward nine major tasks for achieving economic and social development in 2022. At the same time, it also touches on the topic of government building, the affairs of ethnic groups, religions, overseas Chinese, affairs related to Hong Kong, Macao and Taiwan, and national defense as well as diplomacy.
Next, I and my colleagues, Liu Rihong and Song Li, would like to discuss the drafting of the report with you.
_ueditor_page_break_tag_Shou Xiaoli:
Thank you, Mr. Xiang. The floor is now open for questions. Please identify your news outlet before raising your question.
CCTV:
This year's government work report pointed out in its beginning part that "last year was a milestone in the history of the Party and our country." The report also said, "Looking back on the past year, we can see that our achievements did not come easily." Could you specify what "a milestone" and "not easily" mean in this context? Thank you.
Xiang Dong:
Thanks for your question. The report pointed out that the year 2021 was a milestone in the history of the Party and the country. The CPC Central Committee with Comrade Xi Jinping at its core united and led the entire Party and the Chinese people of all ethnic groups to effectively manage many difficult and urgent matters and successfully hold many momentous and joyous events. We solemnly celebrated the centenary of the founding of the CPC, successfully convened the sixth plenary session of the 19th CPC Central Committee, and adopted the Party's third resolution on historical issues. We won the battle against poverty as scheduled, realized the first centenary goal of building our country into a moderately prosperous society in all respects as scheduled, and embarked on the journey of achieving the second centenary goal of building our country into a modern socialist country in an all-round way.
In the government work report, Premier Li Keqiang made a comprehensive summary of the achievements and work in economic and social development over the past year. I was impressed mainly by the following aspects.
In the aspect of economic recovery and development, China's GDP increased by 8.1%, exceeding 110 trillion yuan. That was about US$17.7 trillion as calculated at the yearly average exchange rate, ranking second globally and was estimated to account for more than 18% of the world economy. The per capita GDP exceeded US$12,000 and reached US$12,500, which was expected to surpass the global per capita level. The aim of maintaining stable growth is primarily to secure employment. Last year, 12.69 million new urban jobs were added, and the average surveyed urban unemployment rate was 5.1%. Consumer prices rose by 0.9%. It can be said that China's economy has achieved a rapid growth with a relatively low inflation rate and a relatively high employment rate, which is an optimized combination.
In terms of scientific and technological innovation, the Shenzhou-12 and Shenzhou-13 manned spaceships were launched in succession, the Chinese people for the first time entered their own space station, and China's Mars probe Tianwen-1 successfully landed on Mars. China's strategic capacity in science and technology has become stronger, and a number of national laboratories have been established. China's manufacturing industry has seen continued development, and the resilience of industrial and supply chains has been improved.
As for reform and opening-up, supply-side structural reforms were deeply advanced, and reforms in key areas were accelerated. Progress was made in reforms to streamline administration and delegate power, improve regulation, and upgrade services. A market-oriented, law-based, and internationalized business environment was formed at a faster speed. By the end of 2021, China had more than 150 million registered market entities, and the number has now reached 154 million, among which 100 million are self-employed businesses and households. Foreign trade and foreign investment also witnessed rapid growth, with both the volume of trade in goods and foreign exchange reserves ranking first globally. In 2021, China's economic growth was estimated to contribute around 25% to the world economic growth, continuing to be an important force leading the recovery of the world economy.
In ensuring and improving people's living standards, the growth of residents' income has basically kept pace with the economic growth, the income gap between urban and rural residents has continued to narrow, and the achievements made in poverty eradication have been consolidated and expanded. Basic old-age insurance, basic medical care, and social assistance have been better ensured, and the standards for the basic pension and preferential treatment of the retired people have continued to be improved. New steps have also been taken in the reform and development of education.
Regarding the COVID-19 prevention and control, we have made continued efforts in our long-term fight against the epidemic. By the end of last year, more than 85% of the total population had been fully vaccinated. By the end of this February, the percentage has risen to 87%. We have responded to cluster cases in some areas in a timely and effective manner to safeguard our people's lives and health.
Meanwhile, we have also made progress in coordinated development between regions and between urban and rural areas, in ecological and environmental protection, and in social governance, among other fields.
The challenge was unknown until we ourselves went through the process. Looking back on the past year, China faced complicated and grave situations and a number of risks and challenges rarely seen in many years. Reeling from the severe impact of epidemic outbreaks, China's economy was still in the process of recovery which is not solidly based. In addition, as the domestic and overseas situations evolved, a series of new questions and challenges arose beyond expectations. Challenges came one after another: industrial and supply chain circulation was not smooth, commodity prices rose sharply, sporadic COVID-19 cases broke out in many places, severe floods brought damages to some areas, and electricity and coal were once in short supply. These challenges made it increasingly difficult for us to maintain economic stability and make decisions about macro-control measures. Many of you have been through these together with us. I believe we all feel the same in many aspects. Against such a background, it was not easy for China to attain these development achievements. All these achievements were made thanks to the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the sound guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and the concerted efforts of the Party and the Chinese people of all ethnic groups. All of these have fully proved that policies and plans made by the CPC Central Committee with Comrade Xi Jinping at its core are correct and fully demonstrated that China's economy has ample resilience, enormous potential, and risk resistance capacity.
Thank you.
_ueditor_page_break_tag_Beijing Youth Daily:
According to the government work report, the task of stabilizing employment is more formidable this year. At the same time, China targets a surveyed urban unemployment rate of no more than 5.5% for 2022, which is even lower than the rate of around 5.5% last year. How was this target set? What are our considerations? Will it be completed this year? In addition, I noticed that it is said that there are 200 million workers in flexible employment in China. What's your take on that? Thanks.
Xiang Dong:
Employment is a significant issue concerning people's livelihood, especially for a large country like us with a population of more than 1.4 billion. Last year, stabilizing employment was much affected as enterprise, especially micro, small and medium enterprises (MSMEs), ran into difficulties due to multiple problems such as high commodity prices, the COVID-19 pandemic and other natural disasters. Nevertheless, we kept macro policy targeted, and strengthened efforts to keep the operations of market entities stable, maintain stable employment, and ensure people's wellbeing. Departments at local levels also took measures actively to support people to start business or secure employment through multiple channels. With the joint efforts, 12.69 million urban jobs were added, and the average surveyed unemployment rate stood at 5.1%. We accomplished the target for the year, which was a hard-won achievement.
This year, the task of stabilizing employment is more formidable. There will be nearly 16 million new entrants into the workforce, including a record high of 10.76 million college graduates. On the other hand, MSMEs and self-employed individuals, which are the sources of employment for several hundred million people, still face multiple difficulties. The government work report set the target of maintaining a surveyed urban unemployment rate of no more than 5.5%, lower than the target of around 5.5% last year. This is because employment is key to people's wellbeing and social stability, and following the recovery and development of the economy, we must further prioritize employment-first efforts and ensure all parties fulfill their duties. Therefore, the government work report said that the employment-first policy should be pursued with intensified efforts to deliver the desired outcomes. And we will take complete consideration of the need to stabilize employment when formulating policies concerning tax and fee reductions, support of industries facing particular difficulties, and key groups, among others. With the intensified measures and policies, we are confident of achieving the target for the year. Of course, the target is for the whole year, and that of some individual months may be relatively high. We will step up our efforts to keep the unemployment rate as low as possible.
You mentioned flexible employment. Flexible employment is an important way to boost employment. As the mindset of workers on career choice has changed and enterprises have varied their ways of hiring people, especially with the rapid development of new industries and new forms of business, there is an increasing number of workers in flexible employment, which is now about 200 million. Flexible employment creates jobs for people, especially those in difficulty. At the same time, it demands more from the employment service and social security. Flexible employment is particularly important in ensuring the well-being of people during the COVID-19 pandemic. Therefore, we will improve our support measures for flexible employment and optimize its labor and social security policies to promote its healthy development, and encourage companies to create more jobs with stable income and sufficient guarantees and in different types as they recover and develop.
_ueditor_page_break_tag_CNBC:
I have several questions. My first question is about the consumption sector. According to the government work report, there will be different ways to promote consumption. What are the considerations behind that? And how will these measures be carried out? The government work report also mentioned risks from overseas. So what are the significant aspects and considerations for supporting foreign investment? Thanks.
Xiang Dong:
I will first answer your questions about consumption.
Last year, China's consumption sector recovered, with the retail sales of consumer goods and per capita consumption expenditure growing by 12.5% and 12.6%, respectively, both higher than 2020. Final consumption expenditure drove China's GDP growth by 5.3 percentage points during the past year. It contributed 65.4% of China's economic growth, playing a primary role among the three major growth drives.
At the same time, we should recognize that last year's consumption sector recovered from the low base in 2020. If we look at the average growth rate over the past two years, the growth rate of the consumption sector is still lower than the pre-pandemic level. Especially affected by the ongoing COVID-19 pandemic, consumption of consumer services remains in the doldrums, with the growth of revenues from the tourism and accommodation sector and box office revenue still lower than in pre-pandemic 2019.
China is a large consumption market with enormous potential. For example, the number of motor vehicles per thousand people is less than half of that in Japan and South Korea, and a quarter in the United States. Another example is that the per capita consumer spending on services only accounts for 44% of the total consumption expenditure, which is lower than that of other countries at the same development stage. Also, China's consumption sector upgrades rapidly in recent years, and people's demand for high-end consumption is substantial. However, the potential is not fully released due to the supply shortage.
This year's government work report said that China would promote sustained consumption recovery. And there are concrete measures to be put into place, which are as follows: First, we will boost the recovery in consumption of consumer services. This is the biggest weakness we need to strengthen to recover the consumption sector. And consumption of consumer services has the most significant potential. Second, we will keep major consumption stable. Last year, the sales of new energy vehicles rocketed to 3.82 million, up by 160%. This year, we will continue to support consumer spending on new energy vehicles. At the same time, we will promote spending on green and smart home appliances in rural areas as well as the replacement of old home appliances. Third, we will promote consumer spending at the community, township, and county levels. Efforts will include strengthening the building of community-level consumer services facilities in urban areas and county-level commercial systems and developing e-commerce and express delivery services in rural areas to promote and upgrade consumption by providing convenience and accessibility. In addition, we need to focus on improving the quality of products and services, to meet people's needs better.
Your question about the consumption sector is, in fact, a question about expanding domestic demand. Growing domestic demand includes efforts to promote the consumption sector and investment. The government work report also mentioned effective investment. China has enormous potential and space to expand effective investment. Investment from the central government budget will reach 640 billion yuan this year. Special-purpose bonds for local governments will total 3.65 trillion yuan. There is still carry-over from last year. The government spending is expanding compared to the previous year. We will focus on supporting the major projects in the 14th Five-Year Plan, infrastructure projects related to urban utility networks and others, and strengthening weaknesses in ensuring people's well-being. Private investment accounts for a large proportion of China's investment. And we will use government investment funds rationally and work to play its role in leading and driving effective investment.
Your question about foreign investment will go to Mr. Liu.
Liu Rihong:
Thank you for your question. Opening up is China's basic national policy, and the use of foreign capital makes a major part of China's opening up. You probably have seen the data released by the relevant authorities regarding China's utilization of foreign investment last year, which showed that its actual use of foreign capital exceeded 1 trillion yuan, or more than $170 billion, for the first time. Why has China been able to maintain such a growth rate in its use of foreign investment against the backdrop of the pandemic? From my point of view, the reasons are as follows:
First, China's effective pandemic prevention and control have created a favorable environment for enterprises to ensure normal production and operation. It's fair to say that Chinese economy has become a "stabilizer" and "safe haven" for the global economy over the past two years.
Second, China has complete industrial and supply chains, and the Chinese people are hard-working and talented. Therefore, foreign enterprises have become optimistic about the Chinese market, and are willing to achieve shared success and common development with such a huge market.
Regarding the policies on foreign investment in this year's government work report, I'd like to give you a brief introduction in the following aspects: First, it will ensure the implementation of national treatment for foreign-invested enterprises. In recent years, China has been downsizing its negative lists of market access for foreign investment, and the access to Chinese market has been improved. For example, items on the national negative list and the negative list for pilot free trade zones have been cut by nine and 10, respectively, over the past two years after the breakout of the pandemic. Such reduction is impressive. At present, foreign ownership caps on automobile manufacturing companies have been removed, and restrictions on foreign investment in the manufacturing sector in pilot free trade zones have been removed, achieving remarkable progress in opening up. After the negative lists become shorter, we will work to ensure that foreign investment can access sectors beyond the negative lists in a law-based and equal manner. Therefore, this year's report pointed out that we will fully observe the negative list for foreign investment and ensure national treatment for all foreign-invested enterprises, so as to ensure fair competition among all types of businesses. Second, besides the negative lists, we have a catalog of industries for foreign investment, which from my point of view, is a positive list. After years of practice, our negative lists are becoming shorter and shorter, while the positive lists are growing longer. What is a positive list? Foreign enterprises will obtain some preferential treatment in terms of tax and land use if they invest in the sectors or regions on the list. This was mentioned in this year's report, as it pointed out that we will encourage foreign-invested enterprises to move into a broader range of sectors. Third, we will build and improve the platforms for China's opening up. What are these platforms? They are pilot free trade zones, the Hainan Free Trade Port, economic development zones and integrated bonded areas. In addition, more comprehensive trials on the opening of the service sector are expected to be launched this year. China is a large country, so it has been an important experience for us to launch pilots first while pursuing opening up. Those aforementioned platforms have been launched to implement pilot standards and rules for the opening up. Over the past years, a lot of achievements have been made and enabled us to establish relevant systems, and thereby have been promoted nationwide.
Thanks to these policies, I believe, just as the report says: "The vast, open Chinese market is sure to provide even greater business opportunities for foreign enterprises in China."
Thank you.
_ueditor_page_break_tag_CNR：
The report pointed out that we will issue VAT and VAT credit refunds on a bigger scale this year. Could you please brief us on the background and details of the policy adoption? Why now instead of sometime earlier? Moreover, why do the VAT credit refunds not cover all the industries? What is the significance of the policy for the improvement of the VAT system in the future? Thank you.
Xiang Dong:
Thank you. These is a good question. I'd like to invite Mr. Song to answer it.
Song Li:
VAT credit refunding is an important tax-and-fee support policy adopted this year. Under the current VAT system, an enterprise will have VAT credits if its output VAT is less than the input VAT during a tax period. We have deepened reform since April 2019, establishing and improving the end-of-tax-period VAT credit refund system so as to refund part of the VAT credits.
Currently, China's VAT credit refunds mainly focus on the newly added part generated after April 2019. Among them, we will refund all the newly added VAT credits to advanced manufacturing enterprises, while for other industries, we will refund 60% of the newly added VAT credits that meet the standards.
The report pointed out that we will issue VAT credit refunds on a large scale this year, including the newly added and outstanding ones so as to significantly increase the amount of tax refunds. Given the downward economic pressure, the policy will help enterprises resume their development. Major policies lie in the following two aspects:
First, we will give priority to micro and small enterprises, refunding outstanding VAT credits to them in one lump sum by the end of June, while also fully refunding newly added credits. In order to ensure that the policy takes full effect, the central government will provide greater fiscal support for local governments to ease their burden. We will ensure that the tax credits are fully refunded in time.
Second, with a focus on supporting manufacturing, we will work to fully resolve problems in refunding VAT credits in manufacturing, research and technical services, environmental protection, electricity and gas, and transportation industries.
After the launch of VAT credit refunds on a large scale this year, we will continue to refund the outstanding VAT credits and refund the newly added credits in time, which is of great significance to improving the VAT system.
Thank you.
_ueditor_page_break_tag_21st Century Business Herald:
The COVID-19 pandemic has been going on for more than two years now. We have seen that some countries have begun to lift the lockdowns amid the still raging pandemic and gradually relax control measures. Some places have been fully open without any restrictions. So I want to know, what will China's pandemic prevention and control strategies and measures be in the next step? Thank you.
Xiang Dong:
Thank you for your question. I have noticed that people have paid great attention to this issue in several recent press conferences. In the face of the pandemic of the century, the Chinese government insists on putting people first and putting life first, insists on preventing imports from abroad and preventing rebounds from within, insists on scientific precision and dynamic zero-case policies, and quickly handled and resolved many clustered cases in local areas. The Chinese government has maintained its dominant position in global pandemic prevention and control, creating conditions for economic and social development. At the same time, it should be noted that there are still many uncertainties and variables in the current global pandemic development trend, which brings significant challenges to China's prevention and control. Next, we will continue to adhere to external defense against imported cases and internal defense against rebounds, scientifically and accurately handle clustered cases, protect people's lives and health, and minimize the impact on people's everyday work and life. We will focus our work on the following four areas:
The first is to strictly prevent the import of the pandemic. More than 40 sporadic cases and clustered outbreaks occurred in China in the past two years. After gene sequencing analysis and epidemiological investigation, they were all caused by overseas imports. Therefore, the prevention and control of port cities should be the top priority, and the common prevention and control efforts on "people, objects, and environment" should be strengthened. We must guard the national gate of pandemic prevention and control and resolutely prevent large-scale import and spread.
The second is the precise implementation of prevention and control measures. In response to the problems of prevention and control in some localities, such as one-policy-fits-all and taking excessive policy steps, all localities are required to establish a special working mechanism for reporting, verifying, and correcting relevant problems. In addition, all localities are required to strictly implement the "three don'ts." Don't break through the existing regulations on pandemic prevention and control to lock down cities and districts; don't interrupt public transportation unnecessarily or without approval; don't arbitrarily increase the service industry's pandemic prevention and control measures. We must firmly prevent the two trends of "relaxing prevention and control" and "excessive prevention and control."
The third is to continue to promote the vaccination work. As I mentioned just now, as of the end of last year, China's full-course vaccination rate exceeded 85%, and by the end of February this year, it had exceeded 87%. Therefore, it is necessary to promote sequential immunization and booster vaccination to further improve the effect of immunization.
The fourth is to strengthen scientific research breakthroughs on pandemic prevention and control. We will actively promote the research and prevention of COVID-19 variants, increase the development of vaccine adaptability and specific therapeutic drugs, and strive to find a sharp weapon to control the pandemic as soon as possible.
Thank you.
_ueditor_page_break_tag_The Poster News APP:
The Report on the Work of the Government stated that the main projected target for this year's development is a GDP growth of around 5.5%. Considering the current complex and severe domestic and overseas economic environment, are there any special considerations for such a projection? Thank you.
Xiang Dong:
Thank you for your question. After Premier Li Keqiang finished delivering the report, everyone has been concerned about the projected growth rate this year. China's economy's two-year average growth rate has dropped from the 6% growth rate in 2019, mainly due to factors such as the continuation of the pandemic. From a global perspective, major economies' two-year average economic growth rate is generally slower than that before the pandemic, and the rate of slowdown is greater than that of China.
Setting GDP growth target at around 5.5% this year, first of all, has considered the need to maintain stable employment, meet basic living needs, and guard against risks. Economic stability is the foundation. Employment and income will be difficult to stabilize if the economy is unstable, and some hidden risks will be revealed. Achieving a growth rate of about 5.5% this year, we will have the foundation to expand employment and increase income. The economy's operation will be able to be maintained in a reasonable range.
Second, it is also considered in keeping with the average growth rates of the last two years and the goals of the 14th Five-Year Plan. As you just said, China's economy has grown by an average of 5.1% in the past two years. In 2019, before the pandemic, China's economic growth target was projected to be 6%-6.5%, and the actual growth rate for that year was 6.1%. Although the 14th Five-Year Plan does not set specific economic growth expectations, it requires keeping within a reasonable range. Taking these factors into consideration, it is relatively scientific and reasonable to set the projected economic growth target for this year at around 5.5%, which is in line with China's potential growth level at the current stage and is conducive to guiding expectations, boosting confidence, and building consensus on development.
Third, as the report stated, it represents a medium-high growth rate given our large economic aggregate and demonstrates our ability to move proactively. For example, last year, China's GDP reached 114.4 trillion yuan. On this basis, when it achieves an increase of 5.5%, which is equivalent to an increase of 7.4% five years ago and an increase of 10.5% ten years ago; the corresponding economic increment exceeds 9 trillion yuan, which is close to the annual economic aggregate of the 11th and 12th largest economies in the world. But achieving this goal is not easy and will require arduous efforts. Therefore, to achieve the projected economic growth target of "about 5.5%," we should focus on the following aspects this year:
The first is to insist on ensuring stability a top priority and seeking progress while maintaining stability. We must put stable growth in a more prominent position. All localities and government bodies should earnestly shoulder the responsibility of stabilizing the macroeconomy and actively introduce policies conducive to economic stability. Of course, stable growth is not just about speed ignoring quality. It is about adhering to the new concept for development and promoting the steady improvement in quality and rational growth of the quantity.
The second is to intensify the implementation of macro policies. This year's fiscal, monetary, employment priority, and other policies are sizable. Fiscal expenditure exceeds 26 trillion yuan, and tax rebates and tax reductions are around 2.5 trillion yuan. In addition, monetary policy should strengthen support for the real economy, which can provide strong support for the smooth operation of the economy.
The third is to deepen reform, expand opening-up, and promote innovation. We will firmly implement the strategy of expanding domestic demand and strive to stimulate market vitality and enhance the endogenous driving force for development.
And there is an important premise here: it is still necessary to ensure pandemic prevention and control. We must coordinate pandemic prevention and control with economic and social development, ensure normalized pandemic prevention and control, protect people's lives and health, minimize the impact on production and life, and create conditions for maintaining normal production and living order. This is an essential prerequisite for consolidating economic recovery and development.
Overall, the economic fundamentals sustain long-term growth. The total number of market entities in China has exceeded 150 million and continues to grow quickly. Under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, we will work together, keep going and make pragmatic and persistent efforts to accomplish the targets and tasks for economic and social development this year, with the result of the hard work and vision of more than 1.4 billion Chinese people, a variety of instruments and space for macro policies and a wealth of invaluable experience on responding to significant challenges and withstanding major risks.
_ueditor_page_break_tag_Kyodo News Service:
I have three questions. First, have you considered the international volatility raised by the Ukraine crisis while drafting the government work report of this year? Second, the deficit-to-GDP ratio this year is projected at 2.8%. What's the consideration behind this? Third, this year's government work report has not mentioned the dynamic zero-COVID 19 policy. Does it mean that there are possibilities for the country to adjust its virus control strategy? Thank you.
Xiang Dong:
I want to answer your first question briefly. We have taken various considerations into account while drafting this year's report.
Second, I would like to offer some details about your question concerning the fiscal deficit.
The work report says the proactive fiscal policy will be more effective, targeted, and sustainable. The deficit-to-GDP ratio has been cut appropriately in the recent two years. We mainly take the following factors into account.
First, China's proactive fiscal policies will remain unchanged though the deficit-to-GDP ratio was lowered moderately. According to the work report, it is projected that fiscal revenue will continue to grow in 2022. In addition, we also have available to us the surplus profits of state-owned financial institutions and state monopoly business operations from recent years turned over in accordance with the law and funds transferred from the Central Budget Stabilization Fund. This will make it possible for government to increase expenditures by more than two trillion yuan over last year, putting significantly greater fiscal resources at our disposal. We will implement a new package of tax-and-fee policies to support enterprises, with tax refunds and cuts totaling about 2.5 trillion yuan. Furthermore, this year, special-purpose bonds for local governments will total 3.65 trillion yuan, and a portion of special bonds carried over from last year will be available for further use. In addition, investment from the central government budget will reach 640 billion yuan, an increase of 30 billion yuan over last year. As a result, we will see that the proactive fiscal policy is more effective.
Second, it is conducive to boosting fiscal sustainability. The government set the deficit-to-GDP ratio in 2020 at more than 3.6% to address the COVID-19 pandemic, which was an extraordinary measure for an unusual time. As economic performance recovers stably, we moderately cut the deficit-to-GDP ratio in time, which is constructive to enhancing fiscal sustainability. We have also considered the need to leave policy space to address risks that could arise in the future.
Third, in cutting the deficit-to-GDP ratio to within 3%, we have signaled that China's economy and finance perform prudently, which can boost market confidence.
As for your third question, please refer to my answer to a similar question just now. Thank you.
_ueditor_page_break_tag_The Paper:
In last year's government work report, the CPI was projected to increase by around 3%. However, the CPI rose by 0.9% in 2021. What factors slowed down the CPI increases of last year? Moreover, we noticed that the CPI is set to increase by 3% in this year's report. Will China continue to maintain a low growth this year? Will last year's "low base" impact achieving this year's expected goals? Thank you.
Xiang Dong:
Over the course of last year, the CPI rose moderately by 0.9% on average, creating a favorable environment for economic recovery and improvement of people's lives. Against the backdrop of sharply increasing international commodity prices and increasing global inflationary pressure, China's CPI has remained stable, mainly due to abundant market supply and a bumper harvest in agriculture. In particular, pork prices fall because the pig production has remained favorable. In addition, the CPC Central Committee and the State Council have strengthened market regulation, stepped up efforts to ensure the supply of energy and raw materials, and keep their prices stable, thus creating conditions for price stability.
At present, China's industrial and agricultural production situation is pretty good. The number of hogs and "breeding sows remains high. The supply of major industrial and agricultural products is guaranteed, all of which lays a foundation to keep CPI stable this year. On the other hand, energy prices on the international market have risen considerably in recent months, which puts upward pressure on domestic prices. Due to climate change and other factors, we can't rule out that some agricultural products like vegetables will rise for the current period on the Chinese market. In addition, consumer prices of last year were exerting a 0.9 percentage point of carryover effect on prices this year. In comparison, the carryover effect of prices in 2020 was only a minus 0.1 percentage point. It is predicted that a CPI increase rate year-on-year will expand in 2022. However, it will still rise mildly. The CPI is projected to rise by around 3% this year. We have taken complete account of various potential factors affecting prices and leaving some leeway. This is also in compliance with last year's projected target and will help stabilize market expectations.
_ueditor_page_break_tag_Bloomberg:
According to the work report, this year's fiscal plan focuses on using funds from state-owned enterprises and local government debt to boost consumption and spending. However, the expenditure on infrastructure was relative slow last year because of insufficient good infrastructure projects. How shall we ensure the effective spending of these funds and ensure the problem of last year be well addressed? And how can you keep these policies and measures consistent, and whether it can promote investment in fixed assets?
Xiang Dong:
Thank you. The questions you raised are mainly related to finance. Regarding the government's expenditure mentioned in the work report, there are two major expenditures this year: tax reductions and refunds. I covered the former one, and I'd like to invite Mr. Liu to elaborate briefly on the latter.
Liu Rihong:
As Mr. Xiang said, my colleague covered some of your questions. I would like to add some more details for your reference.
In terms of government expenditure, we will first increase overall spending. According to the report, government expenditure in 2022 is budgeted to increase by more than two trillion yuan over the previous year. You may be curious about the reasons for such an increase. One of the significant reasons is to facilitate tax refunds and cuts. Our practices in recent years prove that tax and fee cuts are crucial measures to innovate macro adjustment and the fairest, most inclusive, and most effective method to support market entities. Statistics show that since the 13th Five-Year Plan was launched, the volume of newly-issued tax and fee cuts has totaled 8.8 trillion yuan, effectively reducing the burden of enterprises. Although policies on tax and fee cuts continue to take effect, China's public finance has achieved sustainable and stable operation due to the growing vitality of market entities and the development of new tax-related market entities. From 2013 to 2021, new tax-related market entities have paid 4.76 trillion yuan in tax. This demonstrates the policy effect of tax and fee cuts.
One of the major reasons for expanding government expenditure this year is to increase transfer payments to local governments, help carry out tax and fee cuts, and ensure that policies concerning 2.5 trillion yuan of tax refunds and cuts can be well implemented.
Another reason is to help expand effective investment. In 2022, 3.65 trillion yuan of special bonds will be issued, similar to the previous year. In the meantime, 640 billion yuan will be allocated for investment in the central government budget, 30 billion yuan more than the previous year. Therefore, there is substantial growing space for China's effective investment. As for the investment in infrastructure you mentioned, indeed, the growth rate in this regard has been comparatively low in recent years, and we will ramp up investment this year. However, our efforts to increase investment are not made in an extensive manner as we did in the past. What we expand nowadays is an effective investment, applied to projects urgently needed for economic growth and people's livelihoods. For example, a bond issued this year will focus on supporting major engineering projects of the 14th Five-Year Plan and those concerning the weakness of society and people's livelihood. With the implementation of the funds, effective investment will be continuously leveraged, which will effectively support the stable operation of the Chinese economy.
Thank you.
_ueditor_page_break_tag_Shou Xiaoli:
Due to time constraints, we are open to two more questions.
Economic Daily:
Currently, China's economy faces new downward pressure, and the country's GDP in the fourth quarter of 2021 only expanded 4% year-on-year. We noted that the government work report proposed many policies and measures in this regard. What are the considerations behind this? Thank you.
Xiang Dong:
China's economy in 2022 faces the triple pressures of shrinking demand, disrupted supply, and weakening expectations, and we must overcome these difficulties. Building on an in-depth analysis of situations both at home and abroad, the government work report has made comprehensive arrangements for the tasks of the government in 2022, proposing a series of policies and measures which aim to continuously maintain sound economic and social development. Regarding your question, I personally think that we can analyze the measures in the following aspects.
First, we need to follow the general principle of prioritizing stability and seeking progress while ensuring stability. The term "stability" is one of the keywords of this year's report and has been mentioned 76 times. The report clearly stipulates that the work in 2022 should follow the aforementioned general principle and attach greater importance to stabilizing growth. All regions and sectors need to take responsibility for stabilizing the economy and proactively introducing policies that help ensure economic stability.
Second, we need to stick to the main policy direction, ensuring stability in the macroeconomy. The report proposed that the efficiency of proactive fiscal policies should be improved and that the fiscal spending will increase by over 2 trillion yuan over the previous year. The central government transfer payments to local governments will reach nearly 9.8 trillion yuan, 1.5 trillion yuan more than the previous year, up 18%, the most significant increase in recent years. A total of 3.65 trillion yuan of local government special bonds will be issued, and 640 billion yuan will be earmarked for investment in the central government budget. China will further strive to implement a prudent monetary policy to expand the scale of newly-issued loans. The policy that prioritizes employment will be further strengthened. China will spare no effort to ensure food and energy security. The report stressed that more efforts should be made to stabilize the production and ensure the supply of grain and other vital agricultural products, keep crop acreage stable and boost the yield of soybeans and other oil crops, in a bid to ensure the food supply for 1.4 billion Chinese people.
Third, we need to properly implement policies to ensure the stable growth of market entities and employment. The report put forward a package of highly effective and well-targeted, hardcore measures. For example, China implemented a new set of combined taxation policies. The total volume of tax refunds and cuts is expected to total around 2.5 trillion yuan, including 1.5 trillion yuan of value-added tax credit refunds. For businesses that didn't lay off employees or only had a few layoffs, refunding unemployment insurance will be continuously implemented. The ratio of funds refunded to micro, small and medium-sized enterprises will significantly improve. More support will be given to catering, hospitality, retail sales, tourism, passenger transportation, and other industries and businesses facing difficulties.
Fourth, we will work to complete the new tasks of expanding domestic demand and improving the quality of economic development. For example, the report rolled out measures of raising the extra tax deduction coverage for small and medium-sized sci-tech enterprises from 75% to 100%. It also calls for granting tax breaks to enterprises that invest in basic research and improving policies on accelerated depreciation of equipment and tools and preferential corporate income tax for new and high-tech enterprises. Furthermore, to speed up the recovery of consumption and investment, the report introduced effective measures of supporting the purchase of new-energy vehicles, accelerating the upgrading of urban pipelines, including those for gas supply, and keeping energy consumption of major national projects under separate management. Meanwhile, according to the report, the government will fully implement all major regional development strategies and coordinate regional development, improve the quality of new urbanization, improve the environment and promote green and low-carbon development.
Fifth, we will implement new initiatives to deepen reform and expand opening-up. The report introduced a series of new measures to build a high-standard market system, advance reforms of state-owned enterprises and the fiscal, taxation, and financial reforms, and deepen reforms to streamline administration and delegate power, improve regulation, and upgrade services. This year, we will face tremendous pressure to ensure stable foreign trade and foreign investment. Despite all the changes in the international landscape, we will open wider to the world and take multiple measures to stabilize the overall performance of foreign trade and foreign investment.
Sixth, we will take new measures to ensure and improve people's wellbeing. Policies and measures in this regard have been a highlight of each year's government work report. This year's report has also rolled out a raft of pragmatic measures. For example, the government will allocate educational resources according to the size of the residential population, and see that school-age children can enroll in nearby schools; steadily enhance services for the prevention and treatment of illnesses including cardiovascular and cerebrovascular diseases and cancer, and better ensure the supply of medicines for rare diseases; appropriately raise the basic pensions and pension standard for urban and rural residents, which will benefit nearly 300 million people; and make care expenses for children under three part of the special additional deductions for individual income tax to ease the burden of giving birth and raising a family.
Seventh, we will meet the new requirements for the improvement of government. Facing new developments and tasks, the government must adopt a new approach. The report requires that governments at all levels and all government employee perform their duties, shoulder their responsibilities, make concerted efforts to promote development and ensure public wellbeing and accomplish new achievements.
_ueditor_page_break_tag_Shou Xiaoli:
The last question, please.
Red Star News:
Major economies globally, including the U.S. the EU, have entered the interest rate rise cycle. Will this affect China's monetary policy? The report says a considerable drop will be seen in the overall financing costs of businesses. What measures will be taken to this end? Thank you.
Xiang Dong:
You have paid attention to the monetary policy. Therefore, Mr. Song will answer the questions.
Song Li:
Historically, most policy adjustments in developed economies have produced spillover effects, affecting the global economy and increasing economic and financial volatility in developing countries, especially emerging market economies. Therefore, China needs to pay close attention to these adjustments as an open economy. However, compared with the last interest rate rise cycle of developed economies, China's ability to deal with external shocks has been significantly improved:
First, China's economy has grown in size, with stronger resilience, broad prospects, and plenty of room to maneuver.
Second, there is much room for policy adjustment. We have been firm in choosing not to adopt a deluge of strong stimulus policies. With ample monetary policy instruments and policy space, we have a strong ability to deal with external shocks effectively.
Third, the RMB exchange rate remains generally stable and floats more freely. So, it can better function as an automatic stabilizer.
Fourth, China's financial system has become more prudent; mutual openness in the financial sector has been enhanced; two-way cross-border capital flows have become more active; RMB assets have become more attractive, and the vitality and resilience of the capital market are increasing.
In the next stage, we will continue implementing a prudent monetary policy and maintaining reasonably adequate liquidity. We will give full play to the role of monetary policy in terms of both amount and structure to provide stronger support for the real economy. Regarding the amount, we will increase new loans, ensure the increases in money supply and aggregate financing are generally in step with economic growth in nominal terms, and further improve the transmission mechanism of monetary policy. Regarding the structure, we will channel more funds to key areas and weak links and extend the coverage of inclusive financing. In addition, we will encourage financial institutions to lower real loan interest rates and cut fees, increase inclusive loans to micro and small businesses, including credit loan, make it easier for those businesses to access financing, and reduce overall financing costs to help them solve financing difficulties.
Thank you.
Shou Xiaoli:
Thank you, Mr. Xiang. Thank you to all the speakers and friends from the media. Today's press briefing is at this moment concluded. Goodbye.
Translated and edited by Zhang Rui, Liu Sitong, Ma Yujia, Li Huiru, Zhu Bochen, Zhang Liying, Wang Yanfang, Chen Xia, Gong Yingchun, He Shan, Zhou Jing, Wang Qian, Wang Yiming, Yuan Fang, Cui Can, Jay Birbeck, David Ball and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Lyu Yansong, vice minister of the Publicity Department of the Central Committee of the Communist Party of China (CPC)
Wang Meimei, vice president of the executive board of the China Disabled Persons' Federation (CDPF)
Liu Guoyong, vice minister of the General Administration of Sports of China
Guo Liqun, spokesperson of the CDPF
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
March 3, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, the SCIO issued a white paper titled "China's Parasports: Progress and the Protection of Rights," which we will now introduce and interpret for you. At this press conference, we are joined by Mr. Lyu Yansong, vice minister of the Publicity Department of the Central Committee of the Communist Party of China (CPC); Ms. Wang Meimei, vice president of the executive board of the China Disabled Persons' Federation (CDPF); Mr. Liu Guoyong, vice minister of the General Administration of Sports of China; and Mr. Guo Liqun, spokesperson of the CDPF.
Now, let's give the floor to Mr. Lyu to introduce the white paper.
Lyu Yansong:
Ladies and gentlemen, friends from the media, good morning. General Secretary Xi Jinping has attached great importance to the wellbeing of the 85 million people with disabilities in China. Since the 18th CPC National Congress, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, China has incorporated the cause of people with disabilities into the Five-sphere Integrated Plan and the Four-pronged Comprehensive Strategy. As a result, the rights and interests of people with disabilities have been better protected, and the goals of equality, participation and sharing have been improved. People with disabilities have an increasingly stronger sense of fulfillment, happiness and security.
The "China's Parasports: Progress and the Protection of Rights" white paper, issued by the SCIO today, is also the first white paper in China on the development of parasports.
China has made historic achievements in developing rehabilitation, fitness activities and athletics for people with disabilities, promoting their equal participation in society, and ensuring their right to share in the fruits of the country's development. Developing parasports is an effective way to help people with disabilities improve their physical fitness, pursue physical and mental rehabilitation, participate in social activities, and achieve all-round development. It also provides a special opportunity for the public to better understand the potential and value of disabled people, and promote social harmony and progress. In addition, developing parasports is of great importance in ensuring that people with disabilities can enjoy equal rights, integrate readily into society, and share the fruits of economic and social progress.
The white paper consists of a preamble, main body and conclusion. The main body is divided into five parts, titled "Parasports Have Progressed Through National Development," "Physical Activities for Persons with Disabilities Have Flourished," "Performances in Parasports Are Improving Steadily," "Contributing to International Parasports" and "Achievements in Parasports Reflect Improvements in China's Human Rights." From these five aspects, it is clear to us that parasports are a mirror reflecting the living standards and human rights of people with disabilities. China guarantees their economic, political, social and cultural rights, laying a solid foundation for them to participate in sports, be active in other fields, and achieve all-round development.
First, parasports have progressed through national development. In the cause of socialist revolution and reconstruction, reform and opening-up, socialist modernization, and socialism with Chinese characteristics for a new era, along with making progress in the cause of people with disabilities, parasports have steadily developed and prospered, embarking on a path which has distinct Chinese features and respects the trends of the times. After the founding of the People's Republic of China (PRC), parasports have been gradually launched in the country. Parasports saw rapid progress following China's reform and opening-up and witnessed historic achievements in the new era. General Secretary Xi Jinping has made a series of important proposals and instructions regarding the causes of people with disabilities and parasports, chartering the course for future development. China has incorporated programs for people with disabilities into its overall national plans such as its national fitness program, the Healthy China initiative, and the program to build China's strength in sports. These demonstrate China's institutional strengths in promoting development of the cause of people with disabilities. Throughout the country, understanding, respect, care and help for people with disabilities are growing in strength. More and more people with disabilities are realizing their dreams and achieving remarkable improvements in their lives through sports. The courage, tenacity and resilience that people with disabilities show in pushing boundaries and forging ahead have inspired the whole nation and promoted social and cultural progress.
Second, physical activities for people with disabilities have flourished. At the community level, a variety of rehabilitation and fitness activities for people with disabilities have been organized, and adapted to local conditions in urban and rural areas. People with disabilities regularly participate in national parasports events, such as the National Special Olympics Day, Fitness Week for Persons with Disabilities, and Winter Sports Season for Persons with Disabilities. Every year since 2016, China has hosted a Winter Sports Season for Persons with Disabilities, providing them with a platform to participate in winter sports, and fulfilling the commitment to engage 300 million people in winter sports made during the bid to host Beijing 2022. China has launched a Self-improvement Fitness Project and a Sports Rehabilitation Care Plan to engage people with disabilities in rehabilitation and physical activities. Progress has also been made in parasports education and research. People with disabilities have also become more active in group rehabilitation and fitness activities.
Third, performances in parasports are improving steadily. In recent years, more and more athletes with disabilities have competed in sporting events both at home and abroad. They are willing to meet challenges, pursuing self-improvement, demonstrating an indomitable spirit, and fighting for wonderful and successful lives. Chinese para-athletes have made outstanding performances at major international sporting events. In nearly four decades of participating in international competitions, China's Paralympic delegation has ranked first in both gold medals and total medal count at the past five Paralympic Games. China also won its first-ever Winter Paralympics medal in Pyeongchang 2018, opening a new chapter in the country's participation in Paralympic Winter Games. The influence of national parasports events continues to grow, and China has trained a number of athletes with disabilities and improved their sports skills. Chinese athletes show growing strength in Winter Paralympic sports. From 2015 to 2021, the number of Winter Paralympic sports in China increased from two to six, so that all Winter Paralympic sports are now covered. The number of athletes increased from fewer than 50 to nearly 1,000, and mechanisms for athlete training and support are improving at the same time.
Fourth, China has contributed to the development of international parasports. The white paper systematically explains how China successfully hosted the Being 2008 Summer Paralympic Games, the Shanghai 2007 Special Olympics World Summer Games, the Sixth Far East and South Pacific Games for the Disabled, and the Guangzhou 2010 Asian Para Games, and made full preparations for the Beijing 2022 Paralympic Winter Games and Hangzhou 2022 Asian Para Games. This has given a strong boost to the cause of the disabled in China and made an outstanding contribution to international parasports. China has made full preparations for the Beijing 2022 Paralympic Winter Games. China advances towards a global community of shared future, takes an active part in world parasports affairs, and is deeply engaged in international exchanges on parasports contributing to mutual learning through exchanges between civilizations.
Forth, achievements in parasports reflect improvements in China's human rights. The remarkable achievements of parasports in China reflect both the sportsmanship and sporting prowess of people with disabilities and China's progress in human rights. China adheres to a people-centered approach and promotes the physical and mental health of persons with disabilities. China upholds equality and integration for persons with disabilities in the national conditions. China attaches equal importance to all human rights to achieve all-round development for persons with disabilities. China encourages international cooperation and exchanges in parasports. The development of parasports accords with China's general development; it effectively responds to the needs of persons with disabilities and promotes their physical and mental health. Parasports are a vivid reflection of the development and progress of human rights in China.
Caring for persons with disabilities is a marker of social progress. Developing parasports is vital in encouraging persons with disabilities to build self-esteem, confidence, independence, and strength and pursue self-improvement. It carries forward the spirit of continuous self-renewal. It creates an atmosphere that encourages the whole of society to understand, respect, care for, and support people with disabilities and their causes. It encourages people to work together to promote the all-round development and common prosperity of people with disabilities. During the process of building China into a modern socialist country in all respects, China will take concrete measures to respect and protect the rights and interests of people with disabilities, including the right to participate in sports, to promote the cause of persons with disabilities and meet their expectations for a better life.
Thank you.
Shou Xiaoli:
Thank you, Mr. Lyu, for your introduction. Let's move on to the question-and-answer session. Please identify the media outlet you represent before asking a question.
_ueditor_page_break_tag_China Media Group:
You mentioned earlier that this is the first time China has issued a white paper on the development of sports for people with disabilities. How do you see the relationship between respecting and safeguarding human rights and sports for people with disabilities?
Lyu Yansong:
General Secretary Xi Jinping made important remarks while presiding over the 37th group study session of the Political Bureau of the CPC Central Committee on China's position, perspective and the development path on human rights in a holistic and systematic way. He emphasized making further efforts to understand the importance and urgency of human rights work, unswervingly adhering to China's path of human rights development, paying more attention to respecting and safeguarding human rights, and better advancing the development of China's human rights cause. Xi said that the role of groups and organizations should be given full play to better protect the rights and interests of women, children, the elderly and people with disabilities.
Both respecting and safeguarding human rights will not be left behind. Protecting the rights and interests of people with disabilities and developing their cause, including sports, are an important part of the cause of human rights in China. Parasports on the rise mark the cause of people with disabilities in China moving up a notch and a vivid reflection of progress in China's human rights philosophy and practice.
We uphold the Party's leadership and the socialist system, ensure people's position as masters of the country, ensure people fairly share human rights and promote the all-round development of human rights. To provide better protection to persons with disabilities, we have formed a support system in which Party committees exercise leadership, the government assumes responsibility, the public gets involved, and organizations of people with disabilities play their full role. Party committees and governments at all levels should shoulder the responsibility of developing the cause of people with disabilities, incorporate programs for disabled people into their various undertakings, continue to improve the system of safeguarding rights and interests of people with disabilities to fulfill and protect the fundamental interests of the overwhelming majority of the Chinese people, including people with disabilities.
We uphold and respect the primacy of the people and stimulate their enthusiasm, initiative, and creativity, which engages them to become the main contributors, promoters, and beneficiaries of the development of the cause of human rights. China promotes the development of parasports, upholds the combination of improving the well-being of people with disabilities and building up their strength, focuses on respecting and protecting the personal rights and dignity of people with disabilities, respects their will, and pushes them to become real subjects of rights, to ensure their equal status and give them the equal opportunity to participate in social life and enjoy the fruits of the country's material and cultural progress.
We insist on a combination of the principle of human rights' universality and the nation's actual conditions. Acting based on China's actual conditions and people's demands, China has facilitated the progress of human rights, ensured its people enjoy extensive and substantive human rights. The Party and the government have rolled out a series of major measures to develop the cause of people with disabilities and improve their conditions, promoted the parasports and scored historical achievements. The goals of equality, participation and sharing have drawn closer.
China firmly believes that the rights to subsistence and development are the primary and basic human rights, treats people's wellbeing as the primary human right, and fully and faithfully implements the new development philosophy to protect the rights and interests of people with disabilities through development. Since the 18th CPC National Congress, China has set up a special welfare system covering tens of millions of people with disabilities. Persons with disabilities from poor households in rural areas, numbering in the millions, have become a focus in the final fight against poverty. The parasports development has been included in China's national strategies of Fitness-for-All, Healthy China initiative, and Building China into a Country Strong in Sports. The supply of basic public services for persons with disabilities has been improved, and the goal of "building a moderately prosperous society in all respects, leaving no one behind, including persons with disabilities,” was achieved. More and more people with disabilities have received better education, found jobs or started their businesses, and participated in social life on an equal footing. Therefore, their sense of fulfillment, happiness, and security continues to grow.
We safeguard human rights in accordance with the law, adhere to the principles of equality before the law, insist that respecting and protecting human rights should be strengthened to fully cover the whole process of legislation, law enforcement, administration of justice, and observance of the law, and enhance role of the rule of law in protecting human rights. China's legal and regulatory system for protecting the rights and interests of people with disabilities has been set up with the Constitution as the core and the Law of the People's Republic of China on the Protection of Persons with Disabilities as the backbone. It is backed up by the Regulations on the Disability Prevention and Rehabilitation of Persons with Disabilities, Regulations on Education for the Disabled, Regulations on Employment for the Disabled, and Regulations on Building an Accessible Environment.
We actively participate in global human rights governance, enhance common values of humanity, practice genuine multilateralism, and work to build a community with a shared future for mankind. China fulfills its responsibilities and obligations as a signatory to the Convention on the Rights of Persons with Disabilities adopted by the United Nations General Assembly and promotes the international cause of persons with disabilities. Regarding parasports as a significant part of international exchanges among the disabled, China has vigorously boosted regional and global sports development for persons with disabilities. Thank you.
Phoenix TV:
The recent Beijing Olympic Winter Games showed us the charm of winter sports. Could you brief us on China's development of winter parasports and the participation of persons with disabilities in winter sports? Thank you.
Wang Meimei:
China pays great attention to winter parasports. We have taken multiple measures to encourage more persons with disabilities to participate in winter sports in recent years. As a result, especially after China's successful bid for the Beijing 2022 Olympic and Paralympic Winter Games, more and more persons with disabilities took part in and enjoyed the charm of winter sports.
First, although winter Paralympic sports began late in China, they grew quickly in recent years. Before 2015, China only developed Paralympic cross-country skiing and wheelchair curling among six Winter Paralympic sports. In 2002, China participated in the Paralympic Winter Games in Salt Lake City of the U.S. In the Sochi 2014 Paralympic Winter Games, 10 Chinese athletes took part in 2 sports and 6 events, and the wheelchair curling team finished fourth, which was the best ever result for the Chinese winter Paralympic team. In the 2018 Pyeongchang Paralympic Winter Games, Chinese athletes won gold in wheelchair curling, marking China's first medal in Winter Paralympics.
Second, China's successful bid for the 2022 Paralympic Winter Games has generated great opportunities to develop its Winter Paralympic sports. In July 2015, together with Zhangjiakou, Beijing won the bid to host the 2022 Olympic and Paralympic Winter Games, which created major development opportunities for China's winter parasports. Thanks to unremitting efforts during the past few years, China's winter Paralympic sports have made great progress. From 2015 to 2021, the number of Winter Paralympic sports in China increased from 2 to 6, so all Winter Paralympic sports are now covered. In addition, the number of athletes increased from fewer than 50 to nearly 1,000. Since 2018, annual national competitions for sporting events in Winter Paralympics have been held. All the six Winter Paralympic sports - alpine skiing, the biathlon, cross-country skiing, snowboarding, ice hockey, and wheelchair curling - have been included in the National Games for Persons with Disabilities. Since 2016, Chinese parasports athletes have participated in international events related to the Winter Paralympic Games, accumulating experience and improving their capabilities. In the Beijing 2022 Paralympic Winter Games, 96 Chinese athletes will take part in all 6 sports and 73 events. Compared with the Sochi 2014 Paralympic Winter Games, the number of athletes will increase by 86, the number of sports by 4, and the number of events by 67.
Third, taking the Winter Paralympics as an opportunity, China's winter parasports rise. China's successful bid for the 2022 Olympic and Paralympic Winter Games allowed persons with disabilities to feel the charm of winter sports. Since 2016, China has hosted Winter Sports Seasons for Persons with Disabilities for 6 consecutive years, providing them with a platform to participate in winter sports and fulfilling the Beijing 2022 bid commitment of engaging 300 million people in winter sports. The scale of participation has expanded from 14 provincial-level units in the first Winter Sports Season to 31 provinces and equivalent administrative units. Various winter parasports activities suited to local conditions have been held, allowing participants to experience Paralympic Winter Games events and participate in mass-participation winter sports, winter rehabilitation and fitness training camps, and ice and snow festivals. A variety of winter sports for mass participation have been created and promoted, such as mini skiing, dryland skiing, dryland curling, ice cuju (a traditional Chinese game of competing for a ball on the ice rink), skating, sledding, sleighing, ice bikes, snow football, and ice dragon boating. These novel and fun sports have proved very popular among persons with disabilities. In addition, the promulgation of materials such as A Guidebook on Winter Sports and Fitness Programs for Persons with Disabilities provides services and support for persons with disabilities to participate in winter sports and fitness.
_ueditor_page_break_tag_Khabar 24:
Besides parasports, how will the Chinese government ensure a barrier-free environment in the everyday life, education and employment of persons with disabilities? What will you do over the next few years? Thank you.
Guo Liqun:
Thanks for your question. The Chinese government attaches great importance to protecting the rights and interests of persons with disabilities. Therefore, it strengthens the building of an accessible environment in all aspects to provide a convenient environment for them to live, study and work.
First, we strengthened legal construction for an accessible environment. China has set up a legal system based on the Law of the People's Republic of China on the Protection of Persons with Disabilities, with the Regulations on Building an Accessible Environment as the backbone, and supplemented by local laws and government regulations. This system provides a fundamental legal enforcement basis for constructing, managing, and supervising an accessible environment.
Second, we included building an accessible environment in the country's overall economic and social development plans and its relevant specialized plans. Creating an accessible environment is strengthened in the 14th Five-Year Plan for National Economic and Social Development, Vision 2035, and a batch of specialized plans focusing on protecting and developing persons with disabilities, improving elderly life, and boosting informatization, tourism and transportation. It is also underlined in the National Human Rights Action Plan, which clarifies China's human rights commitments and fulfills the relevant requirements of the UN Convention on the Rights of Persons with Disabilities. In addition, central departments issued a series of policies and measures to promote accessible environment construction, significantly improving its level.
Third, we promoted accessible environment construction in all aspects and continued to increase the coverage of accessible facilities.
The first is to ensure that newly-built (renovated or expanded) roads, buildings, and residential areas in urban and rural areas are equipped with barrier-free facilities, and increase the barrier-free renovations of existing facilities. 81% of the entrances and exits, 56% of the service counters, and 38% of the toilets among comprehensive service facilities in villages (communities) nationwide have been upgraded for barrier-free access. During the 13th Five-Year Plan period, home adaptation was carried out for 650,000 registered families with severely disabled members, helping them shake off poverty and improve the quality of their life.
The second is to create a barrier-free travel and service environment. The Chinese government continues to strengthen building and upgrading of accessible transport infrastructure, so as to create a barrier-free travel environment. It promotes the application of barrier-free passenger vehicles across the country; 3,598 trains have reserved seats for the disabled; public transport vehicles have special seats for the elderly, the infirm, the sick, and the disabled, and have adopted low-floor buses and barrier-free taxis; and city buses are equipped with visual and audio announcement systems.
The third is to comprehensively promote information accessibility. China strives to solve the difficulties encountered by special groups such as the elderly and the disabled when using intelligent technologies such as the internet, increase the supply of accessible terminal products, push forward the promotion and application of barrier-free products and service technologies, broaden the channels for persons with disabilities to participate in the information society, promote the application of information technology to foster an accessible environment,, and work hard to bridge the "digital divide" to help the disabled enjoy the digital life.
The fourth is to actively promote the construction of a barrier-free environment on campuses and at workplaces. The Chinese government vigorously promotes inclusive education, strengthens the construction and installment of accessible facilities and equipment in schools, and provides relevant supporting services and adequate convenience for students with disabilities to study and live in schools. We have fully guaranteed the employment rights and interests of the disabled; encouraged Party and government organs, public institutions, and state-owned enterprises to take the lead in helping the disabled find jobs; and required employers to improve accessibility of workplaces and provided adequate support for people with disabilities, so as to create necessary labor security conditions for the disabled to find employment.
In the future, the Chinese government will actively implement the requirements of the implementation plan for barrier-free environment construction during the 14th Five-Year Plan period and related regulations and policies, accelerate legislation on the construction of barrier-free environment, implement the working mechanism, improve the policy and standard system, and enhance accessibility of urban and rural infrastructure. It will carry out home adaptation for 1.1 million households with disabled members in financial difficulty and severely disabled members, vigorously promote information accessibility, and further raise the accessibility awareness of the whole society. The government will speed up the building of an accessible environment with complete facilities, complete functions, smooth information, and comfortable experience so as to better facilitate work, life, and study of the disabled, and promote their all-round development and shared prosperity.
Thank you.
People's Daily:
How does the General Administration of Sport of China (GAS) coordinate the development of parasports in the process of implementing national strategies such as the Fitness-for-All initiative, and Building China into a Country Strong in Sports? Thank you.
Liu Guoyong:
Thank you. As you know, sports for the disabled are an important part of the cause of people with disabilities, and it is also an important part of the sound development of our sports. The Party and the state have always attached great importance to sports for the disabled, and especially since the 18th CPC National Congress, the CPC Central Committee with Comrade Xi Jinping at its core has given top priority to the development of sports, including sports for the disabled, and has made a series of new arrangements for sports from the perspective of national strategy, and put forward a series of new requirements. We believe that in order to implement the requirements of the CPC Central Committee and the State Council, it is very important to strengthen top-level design, especially to strengthen policy guarantees for people with disabilities to participate in sports activities. The "Regulations on the Nationwide Fitness Program" stipulates that "citizens have the right to participate in fitness-for-all activities in accordance with the law,” which clarifies that participation in fitness-for-all activities for all citizens, including people with disabilities, is a basic right that must be ensured. The "National Fitness Plan (2021-2025)" proposes: "support the holding of various sports events for the disabled, and carry out sports and fitness activities involving both the disabled and those in good health,” and further "improve accessibility of public fitness facilities, and carry out rehabilitation and fitness activities for the disabled.” Meanwhile, the "Outline for Building a Leading Sports Nation" proposed: "promote the extensive development of rehabilitation sports and fitness sports for the disabled,” and the "14th Five-Year Plan for Sports Development" proposed to "further improve national fitness public services for the elderly, professional groups, and the disabled."
The GAS and the CDPF have jointly issued the notice on printing and distributing the implementation plan for the development of parasports during the 14th Five-Year Plan period and the guiding opinions on further developing rehabilitation and fitness sports for persons with disabilities, which incorporate the rehabilitation and physical fitness of the disabled into the whole process of national fitness work, so as to guarantee the disabled people's equal right to enjoy sports, realize equal access to basic public services in sports, and further enhance the disabled people's sense of gains and happiness. We believe that with these laws and regulations and the support of relevant policies, governments at all levels will have the basis for exercising law-based administration and the sports sector can also strengthen supervision according to these laws, regulations, and policies so that the disabled people can enjoy a healthier and happier life.
_ueditor_page_break_tag_Thecover.cn:
Why should we vigorously develop parasports, and what is the significance and value of doing so? Thank you.
Wang Meimei:
Thank you for your question. First of all, sports are an important way for disabled people to keep fit. Physical activities can promote the healthy development of the body's movement, nerves, circulation, respiration, and digestion, as well as the endocrine, immunity, urinary, and other systems, and make our bodies stronger. By participating in various forms of sports activities, disabled people can also enhance their physical fitness, improve their physical functions, and facilitate their physical and mental health. Therefore, we have adopted various measures to encourage disabled people to actively participate in public sports and competitive sports.
Secondly, sports are an important means to promote the rehabilitation of the disabled. According to the national standard of "Classification and Grading Criteria of Disability,” Persons with disabilities in China include those who have visual, auditory, speech, physical, intellectual, or mental impairments, as well as those with multiple disabilities, while each type of disability is divided into four levels based on the degree of disability. Disabled persons with different types and degrees of disabilities suffer from corresponding physical and mental impairments. Through different rehabilitation methods, the functional impairments may be alleviated or even eliminated, and sports are an effective means of rehabilitation. Through targeted sports activities, the disabled people can build up fitness, enhance capacity to self-support, and improve the quality of life.
Third, sports are an important path for persons with disabilities to
integrate into society. By participating in sports, people with disabilities are encouraged to go out, pursue interests and hobbies, increase their social contact, and enrich their lives. The public is also able to have a better understanding of people with disabilities through their participation and demonstration in sports activities. Assisting persons with disabilities to integrate better into society is an important symbol of the progress of social civilization, and is also a significant goal of the cause of the people with disabilities.
Fourth, sports are an important part of human rights protection for persons with disabilities. The Convention on the Rights of Persons with Disabilities explicitly requires the signatories to take appropriate measures in order to encourage and promote the participation of persons with disabilities in various sports activities. The Law of the People's Republic of China on the Protection of Persons with Disabilities and other laws and regulations contain specific provisions to ensure persons with disabilities can participate in sports activities. Promoting the participation of persons with disabilities in sports is an essential requirement for fulfilling the obligations of the UN's Convention and implementing the provisions of Chinese laws and regulations. And it is also a concrete manifestation of China's protection of human rights. Therefore, we should encourage persons with disabilities to fully participate in sports activities, continuously develop their potential, show a spirit of self-improvement and an optimistic and enterprising spirit, and demonstrate the basic freedom, dignity, value, and power of mankind.
In practice, especially after the majority of persons with disabilities have achieved poverty alleviation and prosperity, they have a stronger demand for cultural life, including sports activities. Participation in sports has become an indispensable part of a better life for persons with disabilities, and more have been enjoying the joy brought by sports.
Thank you.
Southern Metropolitan Daily:
We were deeply impressed by the extraordinary results of Chinese athletes at the Summer Paralympics in Tokyo last year. Could you brief us a little about what outstanding achievements China has made in the field of competitive sports for persons with disabilities? Thank you.
Wang Meimei:
Thank you for your question. I'll answer this. We all know that the Chinese parasports athletes have given outstanding performances at major international sporting events. In 1984, the Chinese Paralympic delegation made its debut at the Seventh Summer Paralympic in New York, USA, for the first time, and they won their first ever Paralympic gold medal. Since then, there has been an upsurge of enthusiasm for sports among people with disabilities, and at the following Summer Paralympics, Team China's performance showed a marked improvement. In 2004, at the Summer Paralympics in Athens, the Chinese delegation ranked first in both medals and golds won. In 2021, at the Summer Paralympics in Tokyo, Team China topped both the gold medal tally and the overall medal standings for the fifth consecutive time. At the same time, since 1987, Chinese athletes with intellectual disabilities have participated in nine Special Olympics World Summer Games and seven Special Olympics World Winter Games. In 1989, Chinese deaf athletes made their international debut at the 16th World Games for the Deaf. Meanwhile, Team China performed very well in the Asian Para Games. During the 13th Five-year Plan period (2016-2020), China sent delegations of parasports athletes to participate in 160 international sporting events and won a total of 1,114 gold medals.
National sports events are also wonderful. Since China organized its first National Games for Persons with Disabilities (NGPD) in 1984, 11 such events have been held, with the number of sports increasing from three – Athletics, Swimming and Table Tennis – to 34. Since the third games in 1992, the NGPD has been listed as a large-scale sporting event ratified by the State Council and held once every four years. This confirms the institutionalization and standardization of parasports in China. In 2019, Tianjin hosted the 10th NGPD (together with the Seventh National Special Olympic Games) and the National Games of China. This made the city the first to host both the NGPD and the National Games of China. In 2021, Shaanxi hosted the 11th NGPD (together with the Eighth National Special Olympic Games) and the National Games of China. It was the first time that the NGPD had been held in the same city and during the same year as the National Games of China. This allowed synchronized planning and implementation and both games were equally successful.
Para-athletes train hard, challenge the limits, forge ahead, and have the courage to win – the keys to achieving extraordinary results. In the Tokyo 2020 Paralympic Summer Games, Team China won 96 gold medals, 60 silver medals, 51 bronze medals, and broke 29 world records. This not only represents outstanding performance but also the Chinese spirit displayed by Team China in the international arena. This spirit is the noble spirit of patriotism, unyielding national spirit, the collective spirit of unity, and the spirit of optimism. It is a source of strength and spiritual support for our athletes and coaches to overcome their difficulties.
China's achievements in competitive sports for persons with disabilities are the result of the dedication of many unsung heroes. The decades of perseverance and hard work of several generations of sports workers for persons with disabilities in China have laid the foundation for the great development of these sports. Among these workers, there are coaches, research teams, and staff, of high professional level, and full of love and selfless dedication. And there are also the para-athletes guides and other assistants who have accompanied the para-athletes all year around. These people are the unsung heroes behind our outstanding results. They have helped para-athletes in their training and competitions, grown with them, and ensured that every athlete is in the best condition to achieve the best result in competition.
China's sports cause for persons with disabilities has been developed in the course of opening up. We would like to express our honest thanks to our international counterparts for their sincere help.
_ueditor_page_break_tag_China Daily:
The Beijing 2022 Paralympic Winter Games is just around the corner. Could you tell us a little about the current preparation status of the Chinese delegation? What expectations do we have for this Paralympic Winter Games? Thank you.
Wang Meimei:
The para ice hockey, para-alpine skiing, para snowboarding, para cross-country skiing, and para biathlon teams of the Chinese delegation for the Beijing 2022 Paralympic Winter Games checked in into the Paralympic villages in Beijing, Yanqing, and Zhangjiakou, respectively, on February 25. And the wheelchair curling team checked into the Beijing Paralympic village on March 2.
Currently, the athletes in the villages have been training before their competitions, which mainly includes adapting to the venues, getting familiar with the competition streamline, improving the competition plan, and adjusting their psychological state. They are looking forward to the upcoming Games.
Compared with summer Paralympic sports, winter Paralympic sports in China got off to a later start, have a relatively weak foundation and are still improving. At the Sochi 2014 Paralympic Winter Games, which was held before Beijing's bid to host the Winter Games, China only had 10 athletes participating in two sports and six events. This time, a total of 96 athletes from China are taking part in all six sports and 73 events. Our objectives are:
First, to demonstrate to the world the spirit of perseverance of Chinese people with disabilities in the new era. Paralympians are focused on displaying their spirit. General Secretary Xi Jinping has highly praised the indomitable and hard-working spirit of China's para-athletes. Even though the competitiveness of China's Paralympians is still improving, their spirit in seeking to meet challenges and pursue self-improvement will undoubtedly inspire us to fully demonstrate their sound spirit.
Second, to present China's achievements in developing winter Paralympic sports. General Secretary Xi Jinping has made several important instructions for the preparatory work of the Beijing Winter Olympics and Paralympics. Following the important instructions, the CDPF considered the preparation and competition as a major political task, set up a leading group for the Beijing 2022 Paralympic Winter Games to guide the preparatory work for the Game. Through six years of concerted efforts of the disabled persons' federations at all levels across the country, we achieved fundamental breakthroughs in our Paralympic winter sports. This year marks China's sixth participation in the Winter Paralympics, featuring its largest-ever delegation and highest-ever number of athletes, who are participating in more categories of sports and events at the Games than ever before.
Third, to strive to achieve good results and win honors for the country. On Feb. 24, General Secretary Xi Jinping wrote a reply to Chinese snowboarder Su Yiming. The Chinese delegation organized its members to study the guiding spirit of the letter in the first place and was determined to follow the spirit to act on the pledge of "keeping the mission in mind and striving together," and to work hard and transcend the self to achieve excellent results and achieve glory for the country.
Thank you.
Beijing Youth Daily:
Just now it was mentioned that equal participation in sports represents an important right for people with disabilities. Can you elaborate on how China has safeguarded equal participation for people with disabilities in sports by law? Thank you.
Lyu Yansong:
First, China has not only included parasports in its national fitness program, Healthy China initiative, and program to build China's strength in sports, but also strengthened equal protection and special assistance for the rights and interests of people with disabilities through legislation, confirming their specific right to participate in sports. Among the regulations, articles 41 to 45 of the Law of the People's Republic of China on the Protection of Persons with Disabilities stipulates the concrete measures that the government and society should take to ensure that people with disabilities enjoy rights related to culture and sports. Article 16 of the Law on Physical Culture and Sports stipulates that the whole of society should care for people with disabilities and support their participation in sports. All levels of government should take measures to ensure people with disabilities have better access to sporting events. Article 45 also stipulates that public sports facilities should make it convenient for people to conduct sports activities and implement preferential measures for people with disabilities.
Second, the Chinese government has actively promoted the construction of barrier-free environments, and effectively guaranteed the equal participation of people with disabilities in all sports activities. For example, in 2019, Beijing launched a special program to foster a barrier-free environment, focusing on 17 major tasks in key areas such as urban roads, public transport, public service venues, and information exchange. A total of 336,000 facilities and sites have been modified, realizing basic accessibility in the core area of the capital city, making its barrier-free environment more standardized, accommodating and systemic. Zhangjiakou has also actively nurtured a barrier-free environment, leading to a significant improvement in accessibility.
Third, China has continuously improved its public sports service system and vigorously promoted the equal participation of people with disabilities in rich and colorful sports and cultural activities. Both the Law on Guaranteeing Public Cultural Services and the Regulations on the Nationwide Fitness Program require corresponding cultural and sport services be provided according to the physical and mental characteristics and needs of people with disabilities. In the efforts to implement the national fitness program, governments at all levels have innovated service methods and launched extensive rehabilitation and fitness activities for people with disabilities at the grassroots level. To improve the sport service ability, local regions have also established sport instructor teams for people with disabilities, so as to effectively guarantee the right of people with disabilities to enjoy basic public sport services. Thank you.
_ueditor_page_break_tag_The Beijing News:
Parasports is an essential part of China's national fitness program. Therefore, I would like to invite the speaker of the General Administration of Sports of China to share what advancements have been made on public fitness services for persons with disabilities.
Liu Guoyong:
Thank you for your question. Mr. Lyu and Ms. Wang have elaborated on the importance for persons with disabilities to participate in sports activities. As you mentioned, as part of our efforts to ensure that persons with disabilities can be part of the national fitness program, we will improve the relevant public service system. From the perspective of sports, we should make efforts in the following three aspects to improve the national fitness public service system for persons with disabilities.
First, we will provide more accessible sports facilities. Second, we will organize more sports activities for persons with disabilities. Third, we will strengthen guidance for persons with disabilities when they participate in sports activities.
Regarding this, the General Administration of Sports of China has made efforts in the following aspects.
First, we have channeled central funds to promote the implementation of the Disability Support Project under the National Fitness Program at the local level. As we see, many communities have equipped with fitness facilities and trails. Now, the needs of persons with disabilities were also considered in our efforts to improve those sports facilities and trails. We have accelerated the implementation of regulations on barrier-free facilities design at various kinds of public fitness venues to enhance all fitness equipment and facilities for persons with disabilities. Additionally, we have encouraged relevant enterprises to research and develop fitness equipment and facilities customized for persons with disabilities and mobilized all social forces to provide public services for persons with disabilities. We have jointly issued the National Basic Public Service Standards for Mass Sports and the Basic Public Standards for Public Sports Venues with relevant departments to provide a more suitable fitness environment for persons with disabilities.
Second, we have provided support and guidance for local sports authorities and parasports organizations to better serve persons with disabilities when they participate in sports activities. Only by organizing them to engage in more activities can they further integrate into society, better playing the role of fitness. Not only on the National Fitness Day but many other important occasions for parasports, we should never forget the essential right of persons with disabilities in participating in sports. Additionally, we have played a positive role in cooperating with the CDPF in international sports events over the last few years. We have provided more convenience and opportunities for persons with disabilities to participate in sports with the successful operation of a series of comprehensive sports events represented by the Paralympic Games, the Asian Paralympic Games, and the National Games for Persons with Disabilities.
Third, it's essential to have specialized personnel to instruct persons with disabilities to participate in sports activities. We have more than 2 million social sports instructors. In recent years, we have improved relevant teaching materials on training for persons with disabilities during the instructor training process, which has enabled the social sports instructors to better understand the characteristics and patterns of persons with disabilities when they engage in sports activities to effectively guide them to participate in sports, build up their body strength, and better integrate into society.
Thank you.
Shou Xiaoli:
Thank you to all the speakers and friends from the media. Today's press conference is with this concluded. Goodbye.
Translated and edited by Lin Liyao, Liu Sitong, Zhang Rui, Zhang Junmian, Yan Xiaoqing, Wang Yanfang, Zhang Tingting, Zhou Jing, Qin Qi, Li Huiru, Wang Qian, Zhu Bochen, Yang Xi, Jay Birbeck, David Ball and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission
Hu Xiaolian, chairman of the Export-Import Bank of China
Chen Siqing, chairman of the Industrial and Commercial Bank of China
Tian Guoli, chairman of the China Construction Bank
Bai Tao, Party secretary of China Life Insurance (Group) Company
Wang Sidong, chairman of China Taiping Insurance Group Company Limited
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
March 2, 2022
Shou Xiaoli:
Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office. Today, we are delighted to be joined by Mr. Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission (CBIRC), who will introduce China's efforts to promote a virtuous cycle of finance and economy amid high-quality development, and answer your questions. Also present at the press conference today are Ms. Hu Xiaolian, chairman of the Export-Import Bank of China (China Exim Bank); Mr. Chen Siqing, chairman of the Industrial and Commercial Bank of China (ICBC); Mr. Tian Guoli, chairman of the China Construction Bank (CCB); Mr. Bai Tao, Party secretary of China Life Insurance (Group) Company; and Mr. Wang Sidong, chairman of China Taiping Insurance Group Company Limited.
Now, I will give the floor to Mr. Guo Shuqing.
Guo Shuqing:
Thank you, Ms. Shou. Ladies and gentlemen, comrades and friends, good afternoon. I am very happy to be speaking with you about the development of China's banking and insurance sectors. First of all, on behalf of the CBIRC and the other speakers, I would like to express my sincere gratitude to friends from the media for your constant interest and support regarding the financial services sector.
2021 was a landmark year in the history of our Party and our country. The CBIRC and the entire banking and insurance sectors have followed the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era; grasped the decisive significance of establishing Comrade Xi Jinping's core position on the CPC Central Committee and in the Party as a whole, and defining the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era; strengthened our consciousness of the need to maintain political integrity, think in big-picture terms, follow the leadership core, and keep in alignment with the central Party leadership; stayed confident in the path, theory, system and culture of socialism with Chinese characteristics; upheld General Secretary Xi Jinping's core position on the CPC Central Committee and in the Party as a whole, and the Party Central Committee's authority and its centralized, unified leadership; borne in mind the country's most fundamental interests; and implemented the decisions and plans of the CPC Central Committee and the State Council. Following the specific directions of the financial stability and development committee under the State Council, we have risen undaunted to face challenges and acted proactively, thus achieving solid progress on multiple fronts.
First, we have made persistent efforts to forestall and defuse financial risks. With regards to the requirements put forward by General Secretary Xi Jinping at the 2017 National Financial Work Conference, by the end of 2019, substantial progress had been achieved in forestalling and defusing major financial risks, and risks in eight areas had been significantly constrained. In 2020, due to the unprecedented COVID-19 pandemic, the leverage ratio of all national economic sectors rebounded. In 2021, risks in key areas continued to be contained, the macro leverage ratio fell by around 8 percentage points, and asset expansion in the financial system, back to a comparatively low level, re-entered the single-digit range. From 2017 to 2021, high-risk shadow banking worth up to 25 trillion yuan has been dismantled, decreasing by 11.5 trillion yuan within the past two years. Non-performing assets worth 12 trillion yuan were disposed of in the past five years, of which more than 6 trillion yuan was handled within the past two years. The hidden debt of local governments has been reduced. The financialization and bubbles in real estate have been curbed. A number of high-risk enterprises and financial institutions that violated laws and regulations have been dealt with in an orderly manner. All internet-based P2P lenders have been shut down, and the outstanding loan balance has been reduced to 490 billion yuan. A total of 25,000 illegal fundraising cases have been investigated and dealt with. China's resilience against external shocks has been improved.
Second, we have contributed to the national economy's return to steady growth. We have met the reasonable and effective financing needs of the real economy and promoted the stable recovery and virtuous cycle of the national economy. In 2021, RMB loans increased by nearly 20 trillion yuan, and banks and insurance institutions issued 7.7 trillion yuan in bonds. The balance of medium- and long-term loans to manufacturers increased by nearly 30% year on year, loans for scientific research increased by 28.9%, and green credit by 21%. We have strengthened financial services for fields severely affected by the pandemic, and the policy to postpone principal and interest repayments on loans will be smoothly shifted after the extension period. We have provided strong support for the normal operation of the coal-fired power industry. Insurance payments increased by 14.1%. About 11.6 billion yuan of payments were allocated for reconstruction after heavy rains in Henan and Shanxi provinces. COVID-19 vaccine insurance has provided risk protection via over 2.8 billion doses of vaccines.
Third, we have opened up new prospects for inclusive financial services. The volume of financial services for small and micro enterprises has increased and the cost has decreased. In the past four years, the annual average growth rate of inclusive loans to small and micro enterprises exceeded 25% and the interest rate fell by more than 2 percentage points. Innovative products such as online insurance and digital credit have developed rapidly. Inclusive financial services have become more extensive and targeted. Large and medium-sized banks leveraged their advantages in technology and data to continuously improve their ability to serve long-tail customers, remote areas and rural revitalization. In 2021, inclusive loans granted by the five largest banks to small and micro enterprises increased by 41.4%. Serious illness insurance covered 1.22 billion urban and rural residents. Agricultural insurance provided 4.7 trillion yuan of risk protection for 180 million households. We advanced the regulated development of the commercial endowment insurance — the third pillar in China's three-pillar pension system. The pilot area of exclusive commercial endowment insurance has been expanded to the whole country. The pilot program for pension wealth management products has been expanded to "10 places and 10 institutions." Another pilot program for pension savings will be launched soon. Commercial pension services for low- and middle-income groups are also being prepared. According to reports by the World Bank and the International Monetary Fund, China's inclusive financial services have maintained an international leading level.
Fourth, we have continued to deepen the reform and opening-up of the banking and insurance sectors. We have implemented the Three-Year Action Plan for corporate governance, continuously improved the modern financial enterprise system with Chinese characteristics, and integrated Party leadership with corporate governance based on the conditions of different regions and institutions. We have taken province-specific measures to deepen the reform of small and medium-sized banks and rural credit cooperatives according to local situations. Zhejiang Rural Credit Union has been restructured into Zhejiang Rural Commercial Union Bank. We have improved the professional management capabilities of small and medium-sized financial institutions, promoted the development of the professional manager market, and started construction on China's financial talent pool. We have deepened the reform of property insurance and life insurance. The comprehensive reform of auto insurance saved more than 250 billion yuan for consumers. The Solvency Regulatory Rules for Insurance Companies (II) has been formulated. We have revised support systems to open up the financial sector at a higher level. A group of international financial institutions with first-class professional advantages in wealth management, non-performing asset disposal, and pension finance have entered the Chinese market.
Fifth, we have resolutely curbed the disorderly expansion of capital in the financial sector. We have strengthened the supervision of non-financial enterprises investing in financial institutions, and consolidated the firewall between industrial capital and financial capital. We have regularly carried out special campaigns to strengthen oversights of shareholders' equity and related party transactions. We have removed the equity of shareholders who violated rules at high-risk institutions in an orderly fashion, and cracked down on illegal shareholders who maliciously hollowed out financial institutions. Four groups of shareholders in violation of laws and rules have been made public. We have put equal emphasis on regulation and development, and adhered to the principle that financial innovation must be made under prudent supervision. We have given equal treatment to the same types of business and entities, and brought internet-based financial business under regulation in accordance with the law. We have strengthened financial anti-monopoly and anti-unfair competition measures, and regulated business cooperation between licensed institutions and internet platforms to maintain market order.
Sixth, we have continued to advance oversight and regulation in a tough manner. We have exercised full and strict governance over Party members and taken integrated steps to punish financial corruption and prevent and control financial risks. We have ramped up efforts to investigate the financial corruption behind the various problems in the financial sector. We have stepped up efforts to strengthen the rule of financial law, improve the rule of law in the bond market, and unify the basic rules for corporate credit bonds. We have promoted financial stability and accelerated the legislation of financial derivates to manage them with "unified regulations and rules." In 2021, the CBIRC amended and released 14 rules and 44 regulatory documents. In addition, we have made the penalties for violating laws and regulations much more costly. A total of 3,870 punishments were meted out to banking and insurance institutions and 6,005 people responsible were punished last year, with confiscated illicit gains or fines totaling 2.7 billion yuan.
Under the overall deployments of the CPC Central Committee, Party committees or leading Party members groups of the financial authorities and financial institutions at all levels are making great efforts to implement thorough rectification according to the results of the eighth round of disciplinary inspection by the 19th CPC Central Committee. We will fulfill the political responsibilities in this regard. We are now formulating rectification plans, and work to ensure that the plans will be very specific to address all of the problems in a comprehensive manner, following the requirements of the CPC Central Committee to strengthen inspection and rectification and ensure better utilization of the inspection results. We need to make solid efforts to ensure that we can learn by analogy and address both the symptoms and root causes. We will be resolved to push reform, take on responsibility, and establish a long-term mechanism to complete the rectification in a high-standard and strict manner. At the same time, we will also urge the financial enterprises to implement rectification measures and resolve the problems found in fulfilling duties. We will further implement the spirit of the 19th CPC National Congress and the plenary sessions of the 19th CPC Central Committee, uphold the leadership of the CPC Central Committee over the financial work and practice the new development philosophy in a thorough, accurate and comprehensive manner. We will ensure that our rectification in response to the disciplinary inspection will enable us to better serve the real economy, prevent and defuse financial risks, and deepen financial reform and opening up to promote high-quality development of the banking and insurance industry, and greet the convening of the upcoming 20th CPC National Congress with concrete actions.
That concludes my introduction. Next, my colleagues and I would like to answer your questions. Thank you all!
Shou Xiaoli:
Thank you, Mr. Guo. Now the floor is open for questions. Please identify your media outlet before raising your questions.
_ueditor_page_break_tag_CCTV:
The Central Economic Work Conference pointed out that China's economic development faces triple pressures of demand contraction, supply shocks, and weakening expectations. What policies and measures will the CBIRC adopt to enable the financial sector to support the stable growth of the real economy? How will the ICBC and other financial institutions implement all these measures? Thank you.
Guo Shuqing:
Indeed. Due to the uncertainties caused by the COVID-19 pandemic at home and abroad, as well as the changes in the environment in other aspects, economic demand is not very strong, with the growth of both consumption and investment being slow. We thereby have to adopt some strong measures. However, we are not talking about a deluge of strong stimulus measures to ease the monetary policies. Fiscal policies will also promote structural adjustments with more specific measures. For the banking and insurance sector in this regard, we hope to promote consumption and expand investment in a targeted manner.
To be more specific, we will first support the production and operation of micro, small and medium-sized enterprises, especially those struggling with difficulties.
Second, we will support rural revitalization. The modernization of rural areas remains arduous, although we have achieved the targets and tasks of poverty alleviation. Rural revitalization needs to boost development in various aspects regarding infrastructure and public cause, such as transportation, roads, energy, water supply, power supply, and schools and hospitals. Moreover, the housing conditions of the rural people need to be improved. Ultimately, rural revitalization is one of our priorities.
Third, after soliciting opinions of a dozen departments, the CBIRC and the People's Bank of China will soon release a document that aims to offer financial services to "new urban residents." The "new urban residents" refer to people who live in cities but have not yet obtained an urban hukou or those who have had an urban hukou for less than two or three years. There are more than 300 million such new urban residents, and they have a rigid demand for housing, jobs, starting up businesses, renting or buying a home, child education, and eldercare. We’ve learned from investigation that these people from rural areas are self-employed individuals or migrant workers who are not in permanent employment. According to statistics, the average working time for rural migrant workers in a company or their posts is around six months. However, they are usually required to submit an income certificate while applying for loans, which is quite tricky for them to do. Child education is also a problem for them. As such, we would like to launch a special document to offer advice for the banking and insurance institutions to provide better services for these "new urban residents." This has been a part of our efforts, in general, to deal with the issues related to agriculture, rural areas, and farmers. Besides this, the financial sector needs to continue to shore up the weak links on various fronts, such as the aforementioned micro and small enterprises, rural revitalization, scientific & technological innovation, and green development. Our efforts will follow market and commerce principles.
Chen Siqing:
Thank you, Mr. Guo. Thanks for the question. Mr. Guo has briefly introduced the support measures of the financial sector, the banking and insurance sector in particular, for the real economy. I'd like to continue to make a general introduction about the measures the ICBC has implemented to support the real economy, especially the manufacturing sector in this regard.
It is the responsibility of the financial sector to offer services for the real economy, which is also the principle that we must follow. In recent years, under the leadership of the CPC Central Committee and the State Council and the guidance of the CBIRC, we have continued to ramp up efforts to support the development of the real economy, achieving remarkable results.
In 2021, ICBC's new loans hit a new high record, with most of them going to the key areas and weak links of the real economy. The average interest rates of the newly issued inclusive loans and those to manufacturing businesses dropped from the 2020 level. The rates of 2020 dropped remarkably from the previous year's level, and they saw a further reduction in 2021, which has effectively helped the manufacturing enterprises, especially those small and medium-sized companies, in terms of reducing costs and enhancing efficiency.
The ICBC has always been committed to offering services to the industrial and manufacturing sectors. In recent years, in response to the national efforts to strengthen manufacturing, we have stepped up efforts to tackle the pains, difficulties, and impediments in financial services to serve the manufacturing sector better. The measures that we've adopted are as follows:
First, we increased loan support. In the past three years, the ICBC's new loans for the manufacturing industry exceeded 100 billion yuan, 200 billion yuan and 300 billion yuan, respectively. The cumulative growth rate exceeded 40%, and the loan balance exceeded 2 trillion yuan. During the 14th Five-Year Plan period, we will strive to take the lead in breaking the 3 trillion yuan loan balance for the manufacturing industry.
Second, we helped stabilize and solidify the industrial chain. By the end of 2021, the ICBC's financing balance for core enterprises in the industrial chain in the manufacturing industry exceeded 750 billion yuan, and financing for upstream and downstream manufacturing enterprises in the industrial chain exceeded 300 billion yuan.
Third, we highlighted key areas. We improved the "credit + non-credit" comprehensive service system. We not only provided credit support, but also contributed to the high-quality development of the manufacturing industry by building an "overpass" for manufacturing industry financial services. By the end of 2021, the ICBC's financing balance for strategic emerging industries exceeded 1 trillion yuan, supporting the manufacture of domestically-produced large aircraft, Fuxing high-speed trains and other major machinery made in China.
At the same time, we have also been paying special attention to the development of small- and medium-sized manufacturing enterprises "with high growth potential, advanced technology and strong market competitive edge" in accordance with the national strategic policy, and we continue to provide specialized financial services in a targeted manner.
All of you are very interested in these enterprises with high growth potential, advanced technology and strong market competitive edge. The ICBC has set up a special mechanism, issued a special plan serving these enterprises, and launched a special campaign. The bank has established 11 financial service centers at headquarter-level for scientific and technological innovation enterprises, and established 100 specialist sub-branches of the bank. By the end of 2021, the number of corporate credit customers of enterprises with high growth potential, advanced technology and strong market competitive edge exceeded 15,000, and the financing balance exceeded 100 billion yuan, with a growth rate of more than 18%.
At the same time, we have developed exclusive plans for enterprises with high growth potential, advanced technology and strong market competitive edge. We launched a special loan financing plan for these enterprises to fully meet their financial needs, and proactively granted credit to more than 6,000 such enterprises.
We offered exclusive products. We have accelerated the promotion of intellectual property pledge loans, actively promoted investment and loan linkage, established long-term cooperation with enterprises, actively solved the problems of difficult and expensive financing for enterprises, and helped enterprises avoid premature dilution of equity and achieve stronger and better performance.
Of course, we are also soberly aware that we still have shortcomings in serving the real economy. Going forward, the ICBC will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and actively implement the rectifications required by the CPC central inspection teams. We will actively implement the new development philosophy, serve the new development paradigm, and make substantive efforts in serving the real economy as the starting point and objective of our work. We must practice the people-centered development philosophy and unswervingly follow the path of financial development with Chinese characteristics. Thank you.
_ueditor_page_break_tag_Economic Daily:
My question is for Chairman Tian of the CCB. Everyone says "if you want housing, go to the CCB," what is your opinion on the current real estate market and its regulatory policies? How do you see risks in the real estate market and future trends? Thank you.
Tian Guoli:
The slogan "if you want housing, go to the CCB" was put forward by the CCB more than three decades ago. At that time, everyone in the country lived in public rental housing, and basically no one was purchasing a house. When we were on the road to housing reform, people struggled to scrape together 50,000 yuan or 100,000 yuan to buy a house. However, people couldn't afford it and were under a lot of pressure. China wanted to develop quickly and so needed to solve the problem of housing marketization, so the CCB took the lead in proposing "if you want to buy a house, go to the CCB." At that time, we designed some financial products along this way of thinking, including the mortgage loans that everyone is now familiar with and has experienced.
With the gradual deepening of market reforms and the increase in the rate of home ownership, it is now basically market-oriented. We have seen a deep-seated problem, that is, the rent-to-purchase ratio needs to be balanced. At present, it is not very balanced. The price-to-rent ratio is basically 1:700. From a financial point of view, it is necessary to design new products to rebalance this problem. Everyone remembers "if you want to buy a house, go to the CCB," but I hope everyone can remember "if you want to rent a house, go to the CCB." It's more cost-effective (to rent a house), given the ratio of 1:700, even in global terms. No matter how much housing prices fall in the future, it will still be difficult to truly solve the issue of housing for the working class, and especially difficult to meet the housing needs of ordinary people, those without savings, migrant workers, and new urban citizens. In the future, we need to rely on rental housing to solve the problem. Since the 18th CPC National Congress in particular, we have emphasized that people are the center, the housing market must be controlled rationally, and there must be a new model. Now the rate of people renting is over 10%, which is already pretty good. Our goal is to push the figure up to more than 30%. Then there will be a fundamental change in the country's real estate market. In other words, it is still the implementation of the saying, "housing is for living in, not for speculation."
The CCB is a major state-owned bank. On the one hand, we should undertake our social responsibilities. On the other, we also have strong professional design capabilities. The CCB already launched a housing rental platform more than four years ago. While the platform is not perfect, it has already covered more than 300 cities across the country. We are working hard to establish relationships with houseowners, and also trying hard to connect with the market and customers. In this regard, the CCB is not engaged in this platform to seek benefits, instead we hope to try and help balance this long-term problem that has troubled society.
As you all know, the real estate issue is a worldwide problem. After Japan's housing bubble burst in the early 1990s, it had a profound impact on its economy. The subprime mortgage crisis in the United States actually stemmed from excess real estate. Fortunately, we have some policy and institutional strengths. But how can we use financial market-oriented means to gradually turn these advantages into economic momentum for sustainable development? We feel stronger and stronger that if we continue to design financial products around this, we will see a new scenario, that is, many residents will gradually become accustomed to renting in the future. You may have noticed that we have some slogans, the first is "if you want to rent a house, go to the CCB" and the second is "housing is for living in, renting is pretty good." In fact, from the perspective of financial management, renting is also a good idea, because now people don't always think that the value of a house will appreciate after buying. That era has now passed. Even if the house appreciates, it is very difficult to cash out. In fact, Europe has some good models for this, and has many financial products for people to manage their money, such as the stock market, bond market and rare metals. People can turn to these as it will be quicker to make money, and they are all relatively good in terms of liquidity, security and being risk-proof. In fact, real estate is not a particularly ideal asset for buying and selling. As the market matures in China, the era of relying on renting will soon definitely come.
Centering on this thought, the CCB put forward the slogan that "If you want to deposit a home in a bank, choose CCB." To be precise, there are some structural problems in the Chinese housing market. The housing vacancy rate is relatively high, and the rental market is unbalanced in two aspects. On one hand, from a landlord's perspective, it's still unclarified how laws would protect their income, and how they would enjoy preferential policies on the tax. Currently, we're discussing these issues with related departments. On the other hand, people may feel it's not so convenient to rent homes. Some leases can be cut short when landlords change their minds. Therefore, renters often lack a sense of stability in their lives.
The CCB put forward another notion that "Long-term rental means long-term stay; long-term stay equals settling down." From the perspective of a new urban resident, if the fixed term could last for three, five, or ten years, it should be enough. Even if you buy homes, you may want to purchase new ones after five to eight years or have new demands. We try to satisfy the needs of new urban residents through these means. There are now over 38 million people registering on the platform of the CCB to conduct transactions of this kind. At the same time, the CCB has a deposit of nearly 130,000 apartments. Sometimes we feel that landlords are not unwilling to rent out homes, since they may not rest assured, apart from taxes and troubles involved. But if the CCB assumes the responsibility, it will help improve their credit. As people have already deposited money in banks, why not homes? At the same time, we use our advantages in this aspect and try to fix long-term periods. During the years when the apartments are deposited in banks, we lock the rent and term to offer a stable home for new urban residents as possible as we can. Gradually, people will get used to renting homes, and it will become a choice and a normal for more new urban residents. We have offered some products in this aspect. We've also set up a housing rental industry alliance which unites sectors like housing design, renovation, and building materials. As for old apartments, the CCB established a comprehensive housing rental system entitled "CCB Jianrong Home." As some neighborhoods were outdated, we employed the best designers to design and renovate them with the best, high-quality, environment-friendly, and branded sanitary ware to lower the cost and offer new urban residents an affordable price. Usually, these run-down areas are located downtown, so the rental should be affordable for them. In Guangzhou, we built homes for sanitation workers through collaboration with the government. They are located in the downtown area, and are just hundreds of steps away from the river bank. These apartments have separate restrooms and kitchens. Though each one is probably about 20 square meters, our exquisite design makes it decent and comfortable. We also have many homes for high-end talents with elaborate designs. The mechanism can be more flexible with rental as the mainstay. It can satisfy the housing rental needs of all strata of society.
Finally, I would like to emphasize that the CCB does not aim to replace property agencies by doing this, but expects to help more property agencies get involved in the transition of the market, based on our responsibility and integrity, including our financial support capacity, and jointly build a new market supply. We believe it can help find a complete solution for the balance of properties in the long run. If the ratio of rental to purchase reaches 4:6, the real estate market would be very stable, and the concern be eased. The CCB has made some attempts, but we're still far away from the target. I hope the media will pay attention to our practice, come to the CCB and CCB Jianrong Home across China for a visit, and promote our notion. Thank you.
Guo Shuqing:
Mr. Tian has talked a lot. He has a good idea and encourages us to rent homes. The housing price declined last year, and the bubble and monetization of properties have been reversed fundamentally. The real estate market is not as active as before, but housing is still in demand, especially its rental and renovation. Therefore, it's of great significance to provide such financial services. We had a slogan in the past that "if you want to have homes, go to CCB." Over twenty years ago, applying for individual housing loans was inconvenient. I have my own experience. At that time, I served as the head of the State Administration of Foreign Exchange and applied for the housing provident fund loan from the CCB. It took half a year from my application to the issuance of the loan. However, afterwards, the financial services in real estate improved at a fast speed. Currently, housing mortgages are issued in great number and they account for a high proportion of loans from large banks. We always remind those banks that they should pay attention to risks as many buy homes for investment and speculation. If the home prices fell in the future, or other problems appeared, a huge financial crisis would arise. Some adjustments in the price of real estate and changes in the demand structure are good things for the financial industry. But we hope the adjustments are not that acute or exert huge influences on the economy. We need a smooth transition. That is all I want to add.
_ueditor_page_break_tag_Red Star News:
China's import and export of cargoes and services contributed over 20% of GDP last year. In recent years, the financial sector has enhanced support to exports and offered them a lot of credit funds. So my question is, how does the financial industry support high-quality trade development? Are they equal to export subsidies in real terms? Thank you.
Guo Shuqing:
They're definitely not subsidies. They are all commercial banks and should make money. Their profits, especially those of large banks, grew significantly. Let's give the floor to our authoritative expert Ms. Hu Xiaolian to answer the question.
Hu Xiaolian:
I'll make an illustration for the question. In the past two years, against the backdrop of the severe pandemic globally, China's exports have maintained great momentum, showcasing the strong resilience of China's foreign trade. China's exports have played an active role in stabilizing global products and industries and ensuring a stable supply. It is indeed difficult to achieve the accomplishment as foreign enterprises have also faced many common obstacles, such as the pandemic. Meanwhile, many uncertainties exist in the industrial and supply chains, and transportation also faces difficulties. Recently, the surge of commodity prices, the turbulence of international markets, changes in exchange rates, and the risk of geopolitics have all brought significant challenges for foreign trade enterprises to maintain steady growth.
The CPC Central Committee and the State Council have attached great importance to it, as keeping foreign trade stable is an important part of ensuring stability on the six fronts and security in the six areas. Offering financial support for foreign trade is the major responsibility and task of the Import-Export Bank of China. We have always put supporting high-quality development of foreign trade as a key component of financial services, and made efforts in the following aspects.
First, we scale up the allocation of financial resources to foreign trade enterprises to ensure their funding needs can be met.
Second, we prioritize the development of medium, small, and micro foreign trade enterprises. They are significant contributors to China's exports, so we rely on fin-tech to handpick eligible enterprises with export competitiveness as the candidates of our support programs.
Third, we mainly keep a close watch on the development of the new mode of foreign trade as we render financial support. New foreign trade modes are a new driving force. Such new modes as the centralized procurement, overseas warehouses and cross-border e-commerce pose challenges to financial institutions. Mortgages, a traditional financing means, can hardly meet the funding needs of new foreign trade modes. This requires us to keep innovating products.
Forth, to prop up foreign trade, we must reinforce its foundations to sharpen the edges of our foreign trade commodities in the global market and strengthen the foreign trade industry. In addition, we have paid extra attention to supporting the development of the foreign trade industry and promoting the quality and efficiency of both upstream and downstream of the foreign trade industry.
The four aforementioned endeavors have given full play to the role of policy-backed finance in bolstering the high-quality development of foreign trade. But, of course, some reporters may ask, what is the difference between policy-backed finance and commercial finance in supporting foreign trade? Just now Mr. Guo said that foreign trade is not a franchise business and policy-backed finance has two characteristics in supporting foreign trade:
First, policy-backed financial support tends to come when foreign trade companies face difficulties. The more dire the situation they face is, the more we need to provide support. So, I think banks can provide solid support for foreign trade enterprises when they are in straits amid an uncertain market.
Second, we have maintained good cooperation with industrial partners. Through industrial collaboration, we can integrate the strength of policy-backed finance and commercial finance. For example, we now support small and micro-sized foreign trade enterprises to turn to on-lending and sign on-lending deals with commercial, financial institutions. Since commercial, financial institutions have many outlets and have built close contact and relationship with many small and micro-sized enterprises, we work with them to provide financial support for such enterprises.
Just now, a reporter asked whether such support is a subsidy. What is a subsidy? According to the definition of the WTO, first, it depends on whether the financial resources provided by financial institutions are indistinguishable or whether financial institutions only provide financial credit support for a particular type of enterprise, a specific sector, or a particular type of products. Second, whether the loan interest rate is far lower than the market average level. According to the definition, the financing support we provide to foreign trade enterprises is by no means a subsidy. Chinese policy banks, especially official export credit institutions, provide support to foreign trade enterprises in the same vein as their foreign counterparts and in accordance with international practice.
The enterprises we support do not belong to a particular type or a particular sector. We support both large and small and medium-sized enterprises; we support both Chinese and foreign-funded enterprises without discrimination. We offer interest rates in line with market principles. Export and import banks also get capital from the financial market. Our financing cost is not low, roughly the same as the bond rates of the ICBC and the CCB in the financial market. We ensure our business covers the cost and runs with a low-profit margin. Under such circumstances, we will not provide subsidies to foreign trade enterprises at interest rates much lower than the market average. This is my answer. Thank you.
_ueditor_page_break_tag_Xinhua News Agency:
Just now, Mr. Guo mentioned the need to regulate the third pillar endowment insurance development. You have repeatedly stressed that the insurance industry should stick to its nature of being a means of protection from financial losses. What will the CBIRC do to maintain insurance as a means of protection and bring it into play in the national social security system and pension financial services? Thank you.
Guo Shuqing:
There are two colleagues from insurance companies. I think they can give you a more detailed answer. Let me say something briefly.
China's financial industry grew very fast. We had only about 4 trillion yuan in financial assets in 1990. The figure has exceeded 370 trillion, and bancassurance accounts for the majority. Especially over the last 30 years, the industry has developed very fast at a fantastic speed. Despite some problems, we have not had a full-blown financial crisis, thanks to the system of socialism with Chinese characteristics, the strong leadership of the Communist Party of China, and the China program and the Chinese system in the financial sector. When it comes to endowment insurance, commercial old-age insurance, medical insurance, and health insurance develop very fast. Compared with European and American countries, however, the development of our insurance and banking sector still lags behind. Our total banking assets rank first in the world, surpassing Europe and the United States, and our insurance volume ranks second in the world. However, the depth and density of our insurance are below the world average level, especially the level of developed countries. We have worked hard to develop endowment insurance. You mentioned the three pillars of endowment insurance: basic old-age insurance, corporate annuities as supplementary insurance, and commercial old-age insurance as the third pillar insurance.
In comparison, the third pillar of insurance lags behind the other two pillars and calls for a boost. Since last year, we have taken some measures and made headway, but we can't be too hasty because we have to guard against risks. In this regard, we proceed with the policy laid down by the financial commission of the State Council -- "Jogging with short steps and making gradual progress." Mr. Bai Tao, take the floor, please.
Bai Tao:
Thank you, Mr. Guo. Thank you for your questions. Social security concerns thousands of households, the interests and the well-being of every people, and the long-term stability of our country. The insurance industry can function as a "shock absorber" for the economy and a "stabilizer" for society. We have always stuck to the nature of insurance to protect from financial loss, which is an essential requirement set forth by the CPC Central Committee and the State Council. We have participated in developing the social security system in a comprehensive and multilevel way and tried to build an excellent social security net for the better lives of the people.
The life insurer owned by China Life Insurance (Group) Company is a triple-listed company, and its life insurance products and services cover the whole life cycle of people, including medical support, healthcare, elderly care, education, accidents, and so on. The property insurer's support services against risks cover urban and rural regions, companies and individuals, as well as all fields such as property safety and accident prevention. Our life and property insurance have provided nearly 540 trillion yuan of protection against risks for the whole society, offering services for over 800 million clients. We have given full play to the company's advantages, such as its specialized services, widespread networks, technological capacity, and professional personnel. One of the most important strengths of the company is its huge sales network, and we have made full use of the advantages in these aspects and provided efficient services for social security. For example, in terms of critical illness insurance, we have carried out more than 210 projects and offered services for some 350 million urban and rural residents. We also established "one-stop" connections with over 30,000 hospitals so as to gradually resolve the difficulty of payment settlement for medical treatment incurred outside the provincial-level administrative area where the patient's medical insurance is registered. In addition, for supplementary medical insurance, we have offered services for over 91 million clients so far.
Regarding the "third pillar" of China's pension system you just said, Mr. Guo also mentioned that there is a relatively big gap on this issue between China and Western countries. I'll add more information in this regard. In terms of the development of the "first pillar," we have given full play to our role as China's biggest pension insurance company and provided nearly 30 billion yuan of services to social security funds. In terms of the "second pillar," China Life has made full use of its function as a professional pension insurance company, providing management services for occupational pension in 32 coordination regions and providing services for nearly 30,000 companies for company annuity. Currently, the total amount of company annuity and occupational pension that are managed by us amounted to 1.2 trillion yuan, and we have been working to maintain and increase the value of pension funds for clients. As for the "third pillar," we proactively rolled out long-term care insurance for over 23 million people. I'll add another piece of information. Our life insurer has undertaken over 52 million pieces of insurance business that are associated with elderly care, and the total amount of reserve has reached 1.7 trillion yuan, which can provide fund reserve for pensions of our clients.
In addition, another aspect that draws wide attention is our contribution to the improvement of the health support system. We have fully leveraged insurance funds’ character of the long cyclical period, set up a "Grand Pension Fund," and invested in a group of elderly care institutions in South, North, East, and Southwest China. Currently, these institutions started to operate and provide multi-layered elderly care services in retirement homes, communities as well as the homes of the elderly themselves. Besides, based on the need of the health management, we established a "Grand Health Fund" and invested in over 40 companies. We have integrated service resources concerning health care, medicines, and those in hospitals, and provided health management services for our clients.
In conclusion, China Life will continue carrying out the decisions and deployments being made by the CPC Central Committee and the State Council, comprehensively strengthen capacity building, and further give full play to the role of insurance as a "shock absorber" for the national economy and a "stabilizer" for society. We will also make all efforts to develop a social security system that ensures people's basic needs and is inclusive and diversified so as to make the CPC Central Committee be assured and people satisfied. Thank you.
_ueditor_page_break_tag_Bloomberg:
I have two questions. Many European countries have rolled out measures to sanction Russia recently. How will this affect China's financial institutions? Will China follow suit with similar financial sanctions against Russian banks? Secondly, can you update some of the latest progress of the rectification of Ant Group and other fin-tech platforms? What are the next steps? Thank you.
Guo Shuqing:
Regarding your first question, we have paid great attention to the recent armed conflict, or war, between Russia and Ukraine. The Ministry of Foreign Affairs has fully explained China's take on the issue, and our international policies remain consistent. We don't support financial sanctions, especially those proposed unilaterally. This is because such sanctions do not have good effects or much legal basis. We won't join such sanctions and will continue the normal economic, trading, and financial activities with relevant parties. As for how these sanctions will affect China's economy and finance, the impact so far is not clear, and the situation requires further observation. Nevertheless, we believe that, in general, there will not be much impact in the future, for our economy and finance are fairly steady and resilient.
In terms of the second question, not long ago, a special report was released to introduce the situation regarding the rectification of 14 internet platforms that are associated with financial businesses, such as Ant Group. Led by the People's Bank of China, three government bodies, including the CBIRC, the China Securities Regulatory Commission and the State Administration of Foreign Exchange have launched the rectification work since 2020. The rectification has been going well in general. The financial business offered by these platforms is innovative to a certain extent and was not supervised in the past. It takes some time to bring them under supervision. There are many problems during the rectification process, such as how the enterprises and administrative departments identify or certify these products, personal data and privacy protection, and the safeguard of business information and trade secrets, to name a few. These problems concern various aspects and are very complicated, but in general, we are confident in our ability to implement the rectification work well.
Yicai:
I have a question for Mr. Guo, and this is also a hot issue for many stock investors. In recent years, the stock price of large-scale banks has remained comparatively low, and they have a low price-to-book (P/B) ratio. What do you think of this issue? Will there be any measure taken next to make the stock price of these banks truly reflect its value? Thank you.
Guo Shuqing:
I'd like to invite Mr. Tian Guoli, chairman of the CCB, to take your questions. The CCB is the first among China's four big banks to be listed, and it has done a lot of research and analysis on this issue. Mr. Tian will have the floor.
Tian Guoli:
Thank you for your questions. This issue has attracted many stock investors' attention. To put it precisely, since the subprime mortgage crisis in 2008, investors have been holding a less favorable opinion of the business models of traditional commercial banks. Glories of the past no longer exist, and their P/B ratio dropped from over 2 to less than 1. Under this situation, China and the rest of the world have been closely connected, and to a certain extent, finance has become a business that knows no borders. As for the actual market value of Chinese-funded banks, their average P/B ratio of A-share basically stands at 0.66, and that of H-share is 0.47, higher than Japan's 0.44 and lower than Europe's 0.72 and 1.42 of the U.S. Therefore, what I want to say is that this is actually a problem of how stock investors view traditional finance. For the investment itself, I think this is still lucrative. Take CCB, for example. Since it was listed in 2005, CCB has paid more than 900 billion yuan in dividends. In 2019 and 2016, the dividend yield of A-share reached 4.48% and 5.05%, and that of H-share hit 5.66% and 6.09%. Large-scale banks are not suitable for short-term investment. However, in the long run, our dividend yield has far exceeded that of other financial products, meanwhile, shareholders can have the opportunity to make a profit after holding our stocks. As for the issue of stock price, we still need to keep working on the matter. Despite our weaknesses, there are also aspects of our work that the public is not familiar with. For example, CCB has been working to promote new finance. In fact, CCB has transformed. Using an Internet-based thinking model, we have set up 520,000 inclusive financing facilities in about 80% to 90% of villages across China in a bid to provide financing services for rural residents. We have completely applied new platforms and internet-based logic, and our services have covered almost all villages. The future market potential is huge.
The CCB also excels in fintech. Now, CCB's fintech not only provides system construction for CCB itself but also offers support in system construction for its peers. It is increasingly market-oriented. Now, it is delivering results. I hope that people will pay attention to these new moves by CCB. I believe that, with the help of a positive outlook, this will bring a handsome income to the shareholders. Thank you.
_ueditor_page_break_tag_Cover News:
According to data released by the CBIRC, China's shadow banking sector shrank by 4.2 trillion yuan last year. What is the current size of shadow banks? What new measures will the CBIRC take to continue dismantling shadow banks? Thank you.
Guo Shuqing:
Shadow banking was once a serious financial risk for China, which peaked in 2016. Around 25 trillion yuan's worth of risky shadow banks were dismantled in the past five years, but there is still about 29 trillion yuan. The so-called risky shadow banks actually provide loan products, which were also referred to as "quasi-credit" products by industry insiders. There are also other financial products, such as entrusted loans and WMPs, that are not strictly regulated as bank credit. Overall, these risks are completely manageable. In the future, related risks will be gradually resolved from high to low. Take P2P, for example. During the peak period, the transaction volume of P2P reached 2 to 3 trillion yuan each year. Now, the total funds of lenders that have not yet been repaid only stand at over 490 billion yuan. The risk of shadow banks has been greatly reduced.
Of course, as a supervisory department, we will never cease being vigilant because, with the development of the scientific, technological, economic, and financial sectors, there are still many fake "new financial products" and "innovative products." Many are deceptive, even fraudulent products with great risk. So, the CBIRC and all sectors of society should all remain on high alert. Thank you.
The Paper:
According to a meeting of the Political Bureau of the Communist Party of China Central Committee held on Feb. 25, supervision of leading officials and leading groups in the financial sector should be strengthened, and efforts will be made to tackle typical problems such as violations of the central Party leadership's eight-point decision on improving work conduct and the "revolving door." For the CBIRC, what will be done in this regard? Thank you.
Guo Shuqing:
Thanks for your question. All of us here are heads of financial intuitions. The eighth round of disciplinary inspection launched by the CPC Central Committee uncovered various problems in more than 20 institutions in the financial sector, some of which are very serious and need our close attention. I believe that the whole of society is also highly concerned. We will rectify these mistakes in a serious manner, especially violations of the central Party leadership's eight-point decision on improving work conduct that are intolerable. It has been nearly 10n years since the eight-point decision was put forward after the 18th National Congress in 2012. It is very wrong to make such mistakes, and we must resolutely correct them.
You mentioned the "revolving door" problem. There are officials who have left their posts in financial watchdogs, such as in PBOC, CBIRC, CSRC, and SAFE, and then take up jobs in the financial sector or with companies. The key is that there needs to be a clear system to regulate it. We need to watch out as to whether there are direct connections between their two jobs and figure out their specific original and current posts, whether their original government job will make them have improper influence or generate illegitimate benefits for the current job, and whether they have any wrongdoing during their term in the government. We need to investigate and regulate. Earlier, we made some regulations. A former CBIRC employee cannot directly work in an institution that has been regulated by him or has close relations with him. There is a cooling-off period and waiting period after the confidentiality agreement expires. We believe that the system will be more standardized and more rigorous in the future to solve this problem. Thank you.
CRNTT:
It has been three years since the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) was issued. Does the financial sector have any new explorations and breakthroughs in supporting the development of the GBA? Thank you.
Guo Shuqing:
We have been exploring. Mr. Wang is working in Hong Kong; he knows better than us. Mr. Wang, please.
Wang Sidong:
Thank you, Mr. Guo, and this journalist. The construction of the GBA is a major national strategy planned, deployed, and promoted by General Secretary Xi Jinping, and has achieved remarkable results in recent years. The GBA has strong economic vitality and a developed insurance market. There are more than 160 insurance companies in Hong Kong. The depth and density of insurance in Hong Kong rank second in the world. Last year's data has not yet been released. In 2020, Hong Kong's total gross premiums were HK$581.3 billion. There are 25 insurance companies in Macao, and its premium income in 2020 was 26.3 billion patacas. Guangdong is a province that generates huge insurance on the Chinese mainland. Last year, its premium income was 558 billion yuan, accounting for 12.4% of the national market. In May last year, the PBOC and other three ministries and commissions issued a financial support guideline for the development of the GBA, which greatly promoted the interconnection of financial markets and financial infrastructures in the GBA. In September last year, Mr. Guo conducted in-depth research of the GBA and put forward requirements and hopes for the high-quality development of the insurance industry in the GBA. China Taiping is headquartered in Hong Kong. Its headquarters, nine major subsidiaries, and 172 branches are located in the GBA. In 2021, its premiums in the GBA accounted for 23% of the group's total premiums. The GBA has become a strategic highland for the high-quality development of China Taiping.
In 2019, we took the lead in publishing a white paper on China Taiping's participation in the development of the GBA in Hong Kong. With a focus on serving the GBA, we innovated insurance products to promote the interconnection of residents in the GBA and ensure people's livelihoods in Hong Kong and Macao. For example, we innovatively launched cross-border auto insurance for crossing the Hong Kong-Zhuhai-Macao Bridge and established a three-region integrated insurance and compensation mechanism for Guangdong, Hong Kong, and Macao, enabling policyholders to buy insurance of the three places in either of them. In addition, we have also launched exclusive critical illness insurance in the GBA, as well as cross-border medical insurance to provide insurance services for residents of the GBA. In addition, we have cooperated with the Macao SAR government to establish a catastrophe insurance system to provide catastrophe insurance services for small and medium-sized enterprises in Macao.
We also give play to the advantages of the long-term investment of insurance funds to provide financial support for the GBA construction. For example, we launched a HK$10-billion-worth Greater Bay Area Homeland Development Fund together with China Merchants Group, and China Resources Group. We established a 6.5-billion-yuan equity fund of China Taiping Medical Health Industry in Shenzhen at the end of last year. The current investment projects totaled about 50 billion yuan in the area. Last December, we also launched the first high-quality development forum on the insurance industry in the GBA, promoting the international exchanges on the insurance industry in the area.
During the 14th Five-Year-Plan period, we will continue our focus on Hong Kong and Macao and invest in development of the GBA. A three-year action plan was formulated to serve the GBA. We hope to reflect the effects of the insurance industry's services for the construction through implementing the specific projects there. First, pressing ahead with the policies of allowing "Macao vehicles travelling to Guangdong" and "Hong Kong vehicles travelling to Guangdong;" second, cooperating with regulatory departments to conduct cross-border insurance connections; third, participating in and boosting the construction of cross-border insurance service centers. In addition, we will also set up elderly care communities in the GBA and build medical and health scientific industrial park zones of China Taiping. Furthermore, we will actively intensify the function of international risk management centers in Hong Kong and participate in the development of the Northern Metropolis Development Strategy of Hong Kong and set up the Taiping-Hong Kong insurance and scientific innovation fund. Furthermore, we have recently discussed with the Macao Special Administrative Region government the coordinated operation of the Guangdong-Macao Traditional Chinese Medicine Science and Technology Industrial Park in Hengqin.
In addition, we will introduce more global quality resources to the GBA. Last year, we made meaningful attempts, which actively promoted the Belt and Road Initiative, dual circulation, and better the mechanism for Hong Kong and Macao to integrate into our overall development plan. So we are full of confidence in pursuing high-quality development there. Thank you!
_ueditor_page_break_tag_CNBC:
I have two questions. First, what is the difference between the fund-raising demand of micro, small and medium-sized enterprises (MSMEs) this year and previous years? What are your considerations? Second, what are CBIRC's considerations and opportunities for foreign investment in the virtuous circle and high-quality development of economy and finance?
Guo Shuqing:
Due to time constraints, let me give you a brief answer. We all know that the financing of MSMEs is a global issue while it was well resolved in China. When talking about the 120 million enterprises, we can see that most of them are micro and small enterprises or self-employed individuals. Data from the Ministry of Industry and Information Technology, All-China Federation of Industry and Commerce as well as Association of Small and Medium Enterprises showed that small and micro-enterprises accounted for about 30% in all those got bank loans. At the same time, some figures are higher or lower. In general, approximately 30% of the market entities can get bank loans, which is an outstanding achievement. However, we are not satisfied with this. We will continue to make good use of such means as science, technology, and digitization to better cultivate a customer-centered culture, provide good services, and mitigate difficulties enterprises face in accessing affordable financing.
Regarding the issue of foreign investment, our opening-up policies remain consistent. Since the 19th CPC National Congress, the CBIRC has adopted more than 50 opening-up policies and measures in financial sector. Among them, 34 are targeting the banking and insurance industries, with some being made into regulations. Related laws were amended accordingly and were put into practice. Though some were still under revision, generally, all these policies were carried out. As a result, more and more institutions approved by us started their operation here, such as the foreign-owned insurance companies, foreign shareholding banks, and wealth management companies, among which are internationally renowned institutions. Thank you!
Shou Xiaoli:
We can only take two more questions due to time constraints.
21st Century Business Herald:
Regarding the reforms of the provincial rural credit unions, we know that the Zhejiang Rural Credit Union has been transformed into Zhejiang Rural Commercial Union Bank. What progress has been made in other provinces? Is there any difference in the direction of reforms? Thank you.
Guo Shuqing:
The direction of reforms is the same: establishing a modern enterprise financial system. This applies to small and medium-sized banks, rural credit cooperatives, and provincial- and county-level credit unions. The specific organizational forms may vary from province to province. Some may choose to invest in its member institutions and becomes their largest shareholder, such as the case of the Zhejiang Rural Commercial Union Bank. With provinces each worked out their own plan, the CBIRC is working to guide and improve on them. We noted that some provinces proposed a double-layer structure – provincial holding company holds stakes in county-level credit unions. There are also plans of a three-tier structure and a type featuring several agricultural and commercial banks and business segments in a single province. In addition, a very small number of provincial rural credit unions were small. They were reformed into two or three rural commercial banks and rural credit cooperatives.
In a word, the forms are various. But there is a common requirement that local CPC committees and governments strengthen their management in this regard. We have made the policies clear: We will respect opinions from the locals while strengthening the Party's overall leadership; we will proceed from reality and strengthen the requirements for professional personnel; a professional manager market will be established to let professional people do professional things; and basic qualifications will be required for the management teams. What's more, we will regulate the corporate governance system strictly according to the law. The system should consist of shareholders' meetings, boards of directors, boards of supervisors, and senior management. And more importantly, we need to learn from the past and conduct a strict review on the shareholders to avoid practices such as one shareholder acquiring a controlling stake, misappropriation of funds through related-party transactions, or directly using bank funds and insurance premiums to increase leverage. In a word, the reform of rural credit cooperatives is progressing well, and yet we still need more time. Thank you.
_ueditor_page_break_tag_China News Service:
In recent years, there have been two phenomena taking place. On the one hand, excessive credit funds have flowed from banks into "big clients," including big cities, big enterprises, big projects, and some specific sectors. In contrast, credit to private enterprises and small and microbusinesses have been squeezed. But on the other hand, banks have made a big push to provide targeted inclusive loans to small and micro businesses, increasing the risk of non-performing loans and squeezing profits, which influenced shareholder's returns. I would like to know Mr. Guo's point of view regarding these two phenomena. Thank you.
Guo Shuqing:
There is indeed a big problem in banking services of excessive credit funds flowing into "big clients," especially into the real estate sector. We are now reflecting carefully on the problem and summing up experience and lessons. I think my colleagues here also know this too well. Both banks and insurance companies have suffered severe losses due to investments in high-risk enterprises and conglomerates. That's why we should improve our work in this regard.
On the other hand, while big banks and financial institutions were prompted to make their services accessible to small and micro businesses, they have begun to compete with local medium and small banks and financial institutions and squeeze their living space. Through our field trips to different places, we have heard a lot of complaints from rural credit cooperatives, rural commercial banks, and village banks, saying that the ICBC went too far by grabbing clients from them. And the CCB did this, too. Some small insurance companies also blamed big insurance companies, such as China Life and China Taiping. There were various complaints in this regard. Mr. Tian just said that the CCB had agents at more than 500,000 villages. With an iPad and a commission of 1,000 to 2,000 yuan, these agents can provide villagers with essential financial services, including depositing or withdrawing money and transaction services. So we have seen that competition is very stiff. With the development of digitalization, big banks also face the pressure to survive. The number of physical bank outlets nationwide has declined for three consecutive years. In the future, the whole banking system and its business models will embrace profound changes, and so will the insurance industry. Therefore, all we can do is to earnestly study the situations, follow the prevailing trend, keep abreast of the times, constantly promote supply-side structural reforms and improve the structures of banks and insurance companies. Thank you.
Tian Guoli:
I would like to add something here. The inclusive loans provided by the CCB are less than 800,000 yuan on average, compared to over 2 million yuan of loans provided by medium, small and micro banks. There used to be no financial services targeting clients of loans less than 800,000 yuan. Why did I stress "New Finance?" In fact, both the physical outlets and traditional services of the CCB are now declining. Recently, it was reported in Shanghai that people from across the country can now receive services such as issuing certificates and licenses at the CCB's Shanghai outlets without the hassle of travelling back to their hometowns. Another point is that people don't know much about the share price of the CCB. That may result from our lack of publicity and communication with our friends from the media. Here, I ask you a favor to help popularize the relevant information.
Shou Xiaoli:
Thank you, Mr. Guo. And thanks to our speakers as well as friends from the press for joining us. Your hard work is greatly appreciated. That's all for today's press conference. Goodbye.
Translated and edited by Zhang Rui, Huang Shan, Mi Xingang, Wang Wei, He Shan, Liu Sitong, Zhu Bochen, Wang Yanfang, Zhang Tingting, Li Huiru, He Shan, Li Xiao, Wang Qian, Zhang Liying, Yuan Fang, Gong Yingchun, Yang Xi, Wang Yiming, David Ball, Jay Birbeck, and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Wang Wentao, minister of commerce
Wang Shouwen, vice minister of commerce and deputy China international trade representative
Sheng Qiuping, assistant minister of commerce
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
March 1, 2022
Xing Huina:
Friends from the media, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are delighted to be joined by Mr. Wang Wentao, minister of commerce, who will introduce China's efforts to pursue stable and high-quality commerce development, and answer your questions. Also present at the press conference today are Mr. Wang Shouwen, vice minister of commerce and deputy China international trade representative, and Mr. Sheng Qiuping, assistant minister of commerce.
Now, I will give the floor to Mr. Wang Wentao.
Wang Wentao:
Thank you, Ms. Xing. Ladies and gentlemen, friends from the media, I am glad to meet you here, and thank you for your constant interest and support regarding China's commerce development. 2021 was a landmark year in the history of our Party and our country. Faced with the complex domestic and international situation, as well as multiple risks and challenges, under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, we focused on the overarching task of fostering a new development paradigm and performed the important role of commerce development in three aspects. I would like to explain the three aspects. First, commerce development is an important part of the domestic economy; second, commerce development is an important juncture connecting domestic and international markets; and third, commerce development is important to the new development paradigm. Last year, China's commerce development remained stable and exceeded expectations. Specifically, domestic consumption continued its steady recovery, and foreign trade became a highlight of economic growth, hitting a record high in terms of both volume and international market share. Utilized foreign investment grew rapidly, outbound investment remained stable, and multilateral and bilateral economic and trade cooperation achieved new breakthroughs.
This year, we will continue to follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, implement the guiding principles of the 19th CPC National Congress and plenary sessions of the 19th CPC Central Committee, carry out the decisions of the recent Central Economic Work Conference, pursue progress while ensuring stability, perform the important role of commerce development in three aspects, firmly implement the strategy of boosting domestic demand, promote continued consumption recovery, stabilize the overall performance of foreign trade and foreign investment, open wider to a high standard, make every effort to maintain steady commerce development, and greet the convening of the 20th CPC National Congress with concrete actions.
Next, my colleagues and I would like to answer your questions. Thank you.
Xing Huina:
Thank you, Mr. Wang. Now the floor is open for questions. Please identify the news outlet you work for before asking your question.
_ueditor_page_break_tag_CCTV:
Consumption is the main driving force behind economic growth. Maintaining the stability of consumption is essential to keeping the fundamentals of the economy stable. Currently, sporadic COVID-19 cases have put great pressure on consumption recovery. How do you view the present consumption situation? What measures will be taken to promote the steady recovery of consumption? Thank you.
Wang Wentao:
Thank you for your questions. As we know, consumption is the main force driving economic growth and directly reflects people's demands for a better life. As I mentioned, last year, consumption continued its steady recovery, with total annual retail sales of consumer goods rising 12.5%. In particular, the online retail sales of goods accounted for 24.5% of the total. In addition, as you may have experienced in your daily life, smart, green and health consumption all grew rapidly. Consumption returned to its place as the primary driving force behind economic growth.
However, we also noticed that there have been some problems with consumption since the fourth quarter last year. Downward pressure mounted, with the growth of consumer goods retail sales registering 4.9%, 3.9% and 1.7% in October, November and December, respectively. In general, we feel that the downward pressure on consumption is huge and we face challenges in keeping consumption stable. We will fully enforce the decisions of the CPC Central Committee and the State Council, firmly implement the strategy of boosting domestic demand, balance COVID-19 measures and consumption promotion, make every effort to advance continuous consumption recovery and upgrading, and enhance the role of consumption in economic growth. Going forward, we will do the following:
First, we will fully implement policies that boost the vitality of consumption market entities. Consumption in areas especially related to people's everyday lives and involving gatherings, such as catering, accommodation and retail, has been particularly affected by the pandemic, and these sectors have faced greater difficulties. In particular, small- and medium-sized enterprises (SMEs) face great pressure on their survival. In line with the decisions of the State Council, 14 ministries jointly introduced policies to support the recovery and development of the service industry. We have released strong, targeted bail-out policies for these businesses, especially micro, small and medium-sized enterprises (MSMEs).
Second, we will come up with innovative ideas and approaches to help consumption promotion activities achieve greater success. Last year, commerce departments at all levels organized a series of activities to promote consumption, such as the national consumption promotion month, the online shopping festival for the Chinese New Year, online shopping promotions to boost brand and quality consumption, and time-honored brand carnivals. According to our evaluation, these activities played a positive role in promoting consumption. This year, provided that the prevention and control protocols are duly observed, we will summarize the experience and continue organizing consumption promotion activities. For example, tonight we will hold the launch ceremony for the "Consumption Promotion Month 2022." In the coming period, we will hold various consumption promotion activities integrating online and offline channels, such as consumer goods expos, automobile fairs, and household consumption seasons, to keep the consumption of essential goods stable. We will also organize ice and snow-themed consumption promotion activities as the enthusiasm for winter sports is high thanks to the 2022 Beijing Winter Olympics.
Third, we will continue to serve for a better life and create a consumption upgrade platform. In terms of cities, last year, we set the target of developing five international consumption center cities. After a one-year cultivation, we will summarize and improve. Meanwhile, we will continue to promote the high-quality development of pedestrian streets, build demonstration smart business districts and smart stores, and accelerate the construction of 15-minute radius community circle to facilitate people's life. We will also encourage the development of new business forms and models and new scenarios. Last year, I also mentioned that innovations had been made in many places, where featured streets, internet-famous sites, amid other sites, were built. We will support the development of "first-store economy" and "debut economy" in regions where conditions permit, promote new types of consumption such as customization, experience, intelligence, and fashion consumption, and develop green and healthy consumption to better meet people's aspirations for a better life. Thank you.
_ueditor_page_break_tag_The Paper:
Building a globally oriented network of high-standard free trade zone is an important measure to align with the high-standard international economic and trade rules and promote institutional opening-up. What is the latest progress made by China in implementing the free trade zone upgrading strategy and building a high-standard free trade zone network? What will be the next step to upgrade the building of free trade zones? Thank you.
Wang Wentao:
Thank you for your questions, and I will answer these questions as well. Your questions involve two aspects: One is about progress, and the other is how to improve next.
First, through nearly 20 years of efforts, we have made more friends in the field of free trade, and the content of free trade agreements is increasingly rich in substance, and the level has also improved. A globally oriented network of high-standard free trade zones, which is based on the surrounding areas and stimulates the development of Belt and Road countries, is emerging. According to statistics, we have signed 19 free trade agreements with 26 countries and regions, and our trade partners cover Asia, Oceania, Latin America, Europe, and Africa. Our trade volume with free trade zone partners accounts for about 35% of our total trade. In particular, the Regional Comprehensive Economic Partnership (RCEP) took effect on Jan. 1 this year, which drew close attention. It means that the world's most populous free trade zone with the largest economic and trade scale has been officially launched. We also took this opportunity and worked with five other departments to issue guidelines to promote high-quality RCEP implementation, and launched targeted training programs to improve capabilities of enterprises in making use of the RCEP. I also take this opportunity to call for all regions, departments, especially departments in charge of commerce, and some institutions, to help enterprises strengthen training in this regard and help them learn more about the content of RCEP. Meanwhile, we call for enterprises to search online, and relevant information is available on our website. If they still have questions, they can call us or email us, or contact departments in charge of commerce at all levels, including the MOFCOM. We are willing to help enterprises learn more about the agreement and help them make use of the clauses as soon as possible to inject new vitality into their development. As partners of the RCEP gradually cut their tariffs, I hope that enterprises pay attention to clauses on cumulation in the section of the rules of origin. Dividends of the RCEP will be released gradually, and they will get more real money benefits.
The second question is about how to improve next. We will resolutely implement the decisions of the CPC Central Committee and the State Council, and focus on expanding the coverage and improving the quality and efficiency, implement the strategy of upgrading free trade zones, promote better integration of the domestic and international markets and greater complementarity between domestic and global resources to provide institutional guarantee for higher-level opening up and serve the establishment of the new development paradigm. Last year, we formally applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Digital Economy Partnership Agreement (DEPA), which shows our determination and confidence in deepening reforms and opening up and genuine interest in enhancing global cooperation in the digital economy and promoting innovation and sustainable development. China has contacted, communicated, and negotiated with members of the two agreements. We have also taken the initiative to align ourselves with high-standard international economic and trade rules, comprehensively deepen reforms and accelerate institutional opening up.
Meanwhile, we are also working on free trade agreement negotiations, including China-Gulf Cooperation Council (GCC), China-Ecuador, China-Israel, China-Norway and China-Japan-ROK free trade agreements, and have actively promoted the upgrade of free trade agreements, such as the 3.0 version of China-ASEAN (Association of Southeast Asian Nations) free trade agreement. We are also willing to hold discussions with other economies and countries to explore the signing of free trade agreements. We have actively participated in negotiations on new rules of digital economy, environmental protection and other fields to jointly promote regional economic integration and the liberalization and facilitation of trade and investment. Thank you.
_ueditor_page_break_tag_Nikkei:
What progress has there been since China applied to join the CPTPP last September? Some member countries believe that China needs to solve many problems, including issues related to state-owned enterprises, electronic data, and government procurement, in order to join the CPTPP. Could you introduce the specifics as to how the Ministry of Commerce (MOFCOM) negotiates those problems with the CPTPP members? Thank you.
Wang Shouwen:
Thank you for your questions. China formally applied to join the CPTPP last September, which has drawn great attention from the international community and given rise to positive repercussions in China and abroad. We all believe that China's application for joining the CPTPP is an important opening-up measure in the new era. Before formally applying to join the CPTPP, we conducted full, comprehensive, and in-depth analysis, research, and evaluation of the CPTPP clauses. Based on CPTPP regulations, we sorted out our laws, regulations and reform measures that need to be improved or modified. At present, we are communicating and negotiating with the relevant members in accordance with CPTPP accession procedures.
It is acknowledged that the CPTPP is a high-standard international economic and trade agreement. What I want to point out, in particular, is that the high standard is in line with China's path to deepen reform and expand opening-up. We are also willing to attain the standard of the CPTPP in all respects through actively deepening reform and expanding opening-up. Mr. Wang just mentioned that China has signed many free trade agreements. To join the CPTPP, the efforts to relax market access will be stronger than the existing agreements and practices we have made before. The efforts are conducive to continuing the opening-up and deepening reform and to the high-quality development. At the same time, it will be helpful for the 11 member states of the CPTPP to expand further their market access to the second-largest economy in the world and promote their cooperation with China in goods and services trade, investment, and other sectors.
You mentioned that there are problems. Indeed, the CPTPP covers many sectors, and some of the articles are more complicated and sensitive. However, we believe that the CPTPP is in line with China's general direction of opening-up and reform. For example, the CPTPP rules require state-owned enterprises (SOEs) to compete fairly with other types of companies, which is the core requirement concerning SOEs. This is also in line with the direction of the market-oriented reform of SOEs we pushed for. As independent market entities, SOEs in China operate their business on a commercial basis. They compete fairly with private enterprises and foreign-invested enterprises. And their operations are in line with the market-oriented and law-based principles. Therefore, China is now qualified to fulfill its duties concerning the requirements for SOEs.
You also mentioned the rules and regulations on e-commerce. Pertinent regulations and rules on e-commerce within the CPTPP are quite strict, which are in line with China's efforts in recent years, such as participating in international cooperation on the digital economy, and continuing to optimize the digital business environment. In recent years, it is known that China has adopted three laws: the Data Security Law, the Cybersecurity Law, and the Personal Information Protection Law. Currently, related departments are mulling over supporting rules and regulations, or implementation guidelines, that are related to the three laws. In addition to working on the supporting rules and regulations, we will also consider the standards of the CPTPP, working to meet the requirements of it. Therefore, in terms of all the issues and articles of CPTPP, we are preparing to discuss and negotiate with related member states in detail. President Xi Jinping announced that China would work actively for joining the CPTPP. We are willing to make concert efforts with all parties to further regional trade and economic integration and contribute to regional economic development and global economic recovery. Thank you.
_ueditor_page_break_tag_CGTN:
We know that in 2021, China's foreign trade grew 21.4% to 39.1 trillion yuan. There are reports saying that due to such a high base, China will face greater pressure and challenges in stabilizing foreign trade this year. So, what's your take on that? In addition, would you like to introduce the measures taken by the Ministry of Commerce to ease difficulties for export companies? What are the arrangements for stabilizing industrial chain and supply chain? Thanks.
Wang Wentao:
Thank you for your questions. I'd like to answer your questions. Your questions are mainly about how to see and how to do.
About how to see, you mentioned that China's foreign trade grew by 21.4% to 39.1 trillion yuan last year, which is in yuan terms. While in U.S. dollar terms, China's foreign trade move up another notch to $6.05 trillion, exceeding $5 and $6 trillion consecutively, with a growth rate of 30%, the highest number since 2010. Net exports of goods and services contributed 20.9% to the economic growth. In the first three quarters of last year, in U.S. dollar terms, the share of China's foreign trade in the global market hit a record high. It reached 15%, the highest since 1958 as a single economy in the world, which injected new impetus to world economic recovery and development. The strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core has been fundamental to the hard-won achievements we made last year. And such achievements could not have been made without the consistent hard work of China's export companies.
You just mentioned that certain reports questioned how China will do this year on such a high base. I believe that not only reports, our research also showed that we will face huge pressures this year, and the situation is quite complicated and serious. The Central Conference on Economic Work pointed out the threefold pressure faced by the Chinese economy in 2022, namely the contraction of demand, supply shocks, and weaker expectations. In terms of demand contraction, repeated resurgences of the COVID-19 pandemic still exist around the world, the global recovery is somewhat shaky, and foreign demands remain uncertain. Certain international organizations, such as IMF and World Bank, have downgraded the global economic growth forecast of 2022. The latest report from WTO signaled a cooling of merchandise trade growth. In terms of supply shocks, we have seen that the supply of raw materials and bulk commodities is still not back on track. In other words, the bottlenecks in the supply chain are still not addressed, which we estimate is also hard to be eased in the short term. In terms of weaker expectations, export companies are still beset by shortages of containers and labor. And the price of raw materials and shipping costs are still relatively high. According to our surveys, in particular, the earning performance of some small and medium-sized export companies is not optimistic, which also shakes their confidence to receive orders.
In addition, some short-term factors influencing the export faded away. We also analyzed that. Last year, China's foreign trade registered a high growth rate attributable to certain short-term factors. For example, more orders were received at home instead of overseas. Factors also include exporting epidemic prevention supplies and the "stay-at-home economy." With such factors fading away, China will face more significant challenges in stabilizing foreign trade this year. Also, you mentioned the high base in your question. China's foreign trade grew by 30% last year, in U.S. dollars terms. The pressure to expand the growth is quite considerable on such a high base.
In the face of these difficulties and challenges, we have stepped up efforts to implement policies in accordance with the plans of the CPC Central Committee and the State Council, and rolled out multiple measures to stabilize the foreign trade, including special actions of adopting cross-cyclical adjustment measures, diversifying market, ensuring smooth operation of the supply chains for foreign trade, and promoting innovative and high-quality foreign trade. In the first two months, the foreign trade has basically maintained stable, a stable start of the year. We are confident to accomplish the targets and tasks for the whole year and keep the fundamentals of foreign trade and foreign investment stable. Our efforts will focus on the following three aspects:
First, we will implement policies and prepare for policy options for stabilizing foreign trade. We will work with all local governments and departments to implement the Opinions on Further Stabilizing Foreign Trade by Adopting Cross-Cyclical Adjustment Measures released by the State Council at the end of last year. We will fully implement the policies on tax and fee cuts, make full use of measures on finance and insurance to benefit businesses, and make meticulous efforts to adopt measures on facilitating trade in order to help businesses, especially micro, small and medium businesses, secure orders, stabilize market expectations, and expand market. Meanwhile, we will keep a close eye on external demand and foreign trade and enhance monitoring and early warnings for policy options.
Second, we will guarantee the stability and smooth operation of the industrial and supply chains for foreign trade. Due to the impact of the pandemic and regional conflicts, the flow of people and port operations are still impeded, the problems of barriers and disruption in the global industrial and supply chains remain prominent whilst some new problems emerge. We will promote the transformation and upgrading of foreign trade bases, support the steady development of processing trade, foster a new batch of the on-site processing on a pilot basis from trade between border residents, further promote the integration of domestic and foreign trade, and foster trade enterprises fitting in with China's dual circulation development paradigm, where domestic and overseas markets reinforce each other. We will also strengthen international cooperation to facilitate international logistics and settlement, improve the level of trade facilitation, and promote upstream and downstream coordination of industrial and supply chains
Third, we will continue to promote innovative development of foreign trade. In order to promote the steady and high-quality development of foreign trade, enhance its comprehensive competitiveness, we need to give higher priority to innovative development. Last month, the State Council approved the establishment of 27 new comprehensive pilot zones for cross-border e-commerce. Today, the new list of imported goods for cross-border e-commerce retails has been officially implemented. The goods on the list have been further increased with categories expanded. Meanwhile, we will strength our support for the development of overseas warehouses, build and improve overseas warehouse networks, promote the construction of overseas intelligent logistics platforms, cultivate a number of offshore trading centers in cities (regions), develop and expand new forms and models of foreign trade, and promote the development of trade at a higher level and with higher quality. We will also develop demonstration zones for the innovative development of trade in services, create a number of digital pilot zones for global trade, and develop green trade. Thank you.
_ueditor_page_break_tag_Southern Metropolis Daily:
The Belt and Road Initiative (BRI) is making continuous progress. What new plans will the MOFCOM make this year to promote the initiative in order to foster a new pattern of development? Thank you.
Sheng Qiuping:
Thank you for your question. In the past eight years since the BRI was introduced, China has worked with those countries concerned to uphold the principle of extensive consultation, joint contribution, and shared benefits, and made substantial progress in promoting hard connectivity, soft connectivity, and connectivity of the heart. So far, the BRI has become an international public goods as well as a platform for international cooperation, winning more friends.
Last year, thanks to the joint efforts of all parties, economic and trade cooperation under the BRI continued to deepen and deliver tangible results by overcoming the pandemic and other difficulties, injecting new momentum into global opening-up and cooperation as well as world economic recovery. China's trade with countries along the Belt and Road reached $1.8 trillion, up 32.4% year on year. China's direct investment in these countries stood at $21.46 billion, an increase of 15.3%. China attracted $11.25 billion in foreign investment from these countries, reflecting a 36% rise. All the growth rates are higher than the overall growth. The turnover of China's contracted projects in these countries reached $89.7 billion, accounting for 57.9% of the total.
This year, we will put into practice the guiding principles from President Xi Jinping's speech at the third symposium on the development of the Belt and Road Initiative, precisely grasp the overall requirements for developing the BRI under the new circumstances, strike a balance between rural and urban development, between regional development, between economic and social development, between human and natural harmonious development, and between domestic development and opening-up, and make solid progress in high-quality development of the BRI. We will focus on the following five aspects:
First, we will continue to consolidate fundamentals for cooperation. The BRI is a way of cooperate. Trade and investment cooperation is an important part of the initiative. We will further tap the potential of trade with countries along the Belt and Road, and encourage more imports of quality goods. We will continue to expand three-party and multi-party market cooperation to promote smooth connectivity between industrial and supply chains. We will speed up building a network of free trade zones covering the Belt and Road Initiative, and promote trade and investment liberalization and facilitation.
Second, we will steadily expand new areas of cooperation. A new round of scientific and technological revolution, as well as industrial transformation, is gaining momentum, and countries are more willing to cooperate in the digital economy, green and low-carbon fields. We will actively foster new growth areas for cooperation, deepen the development of Silk Road e-commerce, enhance cooperation in digital trade and new infrastructure, and boost the building of a digital cooperation paradigm. We will also promote green development in outbound investment and cooperation, and strengthen cooperation in areas including new energy, energy conservation, environmental protection, and green infrastructure.
Third, we will build high-quality landmark projects. Over the years, a number of major cooperation projects and livelihood projects have achieved effective results, bringing tangible benefits to the economic development of host countries and improvements in people's livelihoods. For example, the overseas economic and trade cooperation zones set up by Chinese enterprises have paid a total of $6.6 billion in taxes and fees to host countries and created 392,000 local jobs. Next, we will focus on agriculture, poverty reduction, sanitation, health and other fields, and prioritize the construction of more "small and beautiful" projects to enhance the sense of gain among people in host countries. At the same time, we will actively push for the China-Europe rail cargo transport to develop jointly with various cooperation zones and to integrate with new business models such as cross-border e-commerce and overseas warehouses.
Fourth, we will allow mechanisms and platforms to play a greater role. Since the beginning of this year, the Belt and Road economic and trade cooperation mechanism has been continuously improved. We have established working groups for unimpeded trade with 17 countries, established investment cooperation working groups with 46 countries and regions, and established cooperation mechanisms for such areas as e-commerce and service trade with many countries. We will continue to diversify such cooperation mechanisms, continue to hold major international and regional expos, improve the standard of economic and trade exchanges and cooperation at all levels, and provide better services and guarantees for the joint building of the Belt and Road Initiative (BRI).
Fifth, we will comprehensively strengthen risk prevention and control. Currently, the pandemic is still raging worldwide, geopolitical risks are increasing, and unilateralism and protectionism are intensifying, meaning the international environment for the joint pursuit of the BRI is becoming increasingly complicated. We will pay close attention to the global pandemic situation, promote international anti-pandemic cooperation, and strengthen various risk assessments, monitoring and early warnings. We will also guide enterprises to refine their work plans, standardize their overseas business operations, advance trade and investment cooperation and project construction in a steady and orderly manner, and ensure the safety of personnel and projects of Chinese enterprises.
In short, the MOFCOM will perform the important role of commerce development in three aspects, further promote the high-quality development of the Belt and Road, comprehensively promote a higher level of opening-up, and fully serve the building of a new development paradigm. Thank you.
_ueditor_page_break_tag_Yicai:
This January, China's foreign investment increased by 11.6% year on year, demonstrating that China's attractiveness to foreign investment has not diminished under external uncertainties such as repeated coronavirus flare-ups overseas. What are your predictions for China's foreign investment this year? And going forward, what measures will be taken to stabilize the scale and optimize the structure of foreign investment? Thank you.
Wang Wentao:
Regarding the issue of foreign investment, I would like to answer your questions. Over the past two years, due to the impact of the pandemic and adjustments to the global industrial chain and supply chain structure, global cross-border investment has fluctuated greatly. However, China's utilization of foreign investment has maintained steady growth. China has constantly been an attractive destination for foreign investment. In 2021, China's foreign investment hit a new record high, breaking the 1 trillion yuan mark for the first time and reaching 1.15 trillion yuan. This is the first time in the past decade that we achieved double-digit growth, with a growth rate of 14.9%. In terms of U.S. dollars, this figure is $173.5 billion, with a growth rate of 20.2%, and a two-year average of 12.1%. The proportion of foreign investment in high-tech industries exceeded 30% for the first time. The situation of this January was stable and the momentum was relatively good. The actual use of foreign investment in the country maintained double-digit growth, with a growth rate of 11.6%. The Central Economic Work Conference emphasized increasing efforts to attract foreign investment, and we will thoroughly implement this, mainly by further expanding high-level opening-up and further optimizing the business environment. The main direction of the efforts will be in two aspects: one is maintaining stability and the other is promoting excellence. Next, I would like to talk about these two aspects.
The first is maintaining stability, that is, stabilizing the stock of foreign investment and increasing the amount. We will further ease market access for foreign capital. In recent years, we have continued to relax market access, and have reduced negative lists for foreign investment access across the country and in pilot free trade zones for five consecutive years. Last year, we released the negative list of cross-border trade in services for the Hainan Free Trade Port. In addition, we must give full play to the role of some platforms for opening-up in attracting investment. These platforms include 21 pilot free trade zones, the Hainan Free Trade Port, 230 national economic development zones, and the "1+4" localities for showcasing and piloting wider opening-up in service sector. There are also some platforms, such as major expos including the China International Fair for Investment and Trade (CIFIT) and the China International Small and Medium Enterprises Fair (CISMEF), to promote business matchmaking, and attract the signing of more project contracts. We will further strengthen service guarantees. We have a special task force for key foreign-funded projects under the foreign trade and foreign investment coordination mechanism, which is a special team serving enterprises. With this special team, services are more efficient and precise. Last year, we coordinated and resolved more than 1,000 issues reported by foreign-funded enterprises and projects, especially issues we identified as being shared by numerous foreign-funded enterprises, which was welcomed by foreign-funded enterprises. For example, we promoted the introduction of policies to ensure that foreign-funded enterprises can participate in government procurement on an equal footing. Last year, foreign-funded enterprises reported that the relevant ministries and commissions had solved this issue. The special task force will continue to boost services to help enterprises stabilize investment, production and operation, and promote the early signing of projects, early start of production and early reaching of production goals. We will continue to support the promotion of investment everywhere. General Secretary Xi Jinping made a request to the China International Import Expo (CIIE), emphasizing turning exhibits into commodities, and exhibitors into investors. With so many exhibitors coming, how can exhibitors be turned into investors? This presents us with a task. Last year, we used the platform of the CIIE to launch a series of roadshow activities in various regions, the first stop being Sichuan province. I attended the CIIE's Sichuan roadshow event, and saw that 78 exhibitors and 164 enterprise executives participated, which led to a batch of projects settling in Sichuan. This year, we will continue to carry out similar activities to promote the CIIE in local areas, especially in central and western provinces. This is the first aspect I want to talk about.
Second, "advancement" means improvement in structure and quality. Recent years have seen continuous efforts in upgrading the use of foreign investment, for example, high-tech manufacturing industries and high-tech services industries logged an increase of 17.1% and 23.7%, respectively, in absorbing foreign capital last year, and the growth rates in China's central and western regions were above the national average level. However, we also noticed that both the scale and proportion of foreign investment in the manufacturing industry have decreased. In 2021, the scale dropped by 4.6% as against the figure of 2019; the proportion was reduced to 19.4%, which requires us to pay more attention. China is forging ahead from a large manufacturing country toward a manufacturing power and must focus on bringing more foreign funds to this industry. Therefore, we will further intensify support for absorbing more foreign investment, amend the Catalogue of Encouraged Industries for Foreign Investment to include more sectors, and guide more overseas investment into the advanced manufacturing industry, emerging industries of strategic importance, the digital economy, green development, and other areas. Meanwhile, as I just mentioned, China's central and western regions grew at a faster pace in absorbing foreign investment than the national average and have huge potential. China has a vast territory, and its western part has abundant natural resources and adequate labor force. In recent years, China's central and western regions have strengthened their industrial supporting capacity, in particular, the transport infrastructure, which connects China and overseas countries. For example, the launch of China-Europe freight trains and the construction of new land-sea corridor are all driving the growth of imports and exports. After the upgrading of certain airports in the western region, the capacity of land and air transport has been significantly improved. As a result, while pursuing a deeper development in those regions, we will call on more attention from foreign enterprises since the regions have huge potential untapped: a large population, residents' increasing consumption capacity and purchasing power with the growth of the local economy. We will well implement regional plans targeted on both major strategy and coordination development, help these regions bring into full play their advantages, foster new industries, facilitate a smooth transfer of coastal industries to the inland, and create a new growth pole in attracting foreign investment. Thank you!
_ueditor_page_break_tag_21st Century Business Herald:
Since the RCEP took effect on Jan. 1, trade between China and ASEAN countries has been growing rapidly.
How does the MOFCOM view their further cooperation, and what are MOFCOM's following considerations and arrangements? Thank you!
Sheng Qiuping:
Thank you for your questions. China and ASEAN countries have been old neighbors, good friends, and good partners as they enjoy unique geographical proximity, cultural affinity, and complementary advantages. The year 2021 marks the 30th anniversary of the establishment of China- ASEAN dialogue relationship. Over the past three decades, China-ASEAN cooperation has seen remarkable progress, and the China-ASEAN economic relationship achieved leapfrog development. Last year, trade and economic cooperation between the two sides maintained good momentum, showing strong resilience and huge potential.
First, trade has further expanded. Since 2009, China has remained ASEAN's largest trade partner for 13 consecutive years. Last year, the trade volume hit a new record, reaching 878.2 billion U.S. dollars, accounting for 14.5% of China's total foreign trade. The ASEAN has been China's largest trade partner for two consecutive years, with the trade structure being continuously improved and the industrial and supply chains being connected more closely.
Second, the two-way investment has been booming. As of the end of 2021, the China-ASEAN two-way investment registered about 300 billion U.S. dollars. A large batch of projects has been brought forward under their joint efforts. Industrial parks are one of the highlights. Chinese enterprises have established economic and trade cooperation zones in Thailand, Indonesia, Vietnam, and other ASEAN countries, which has played an important role in local industry development. Good examples for such cooperation include the China-Singapore Suzhou Industrial Park; the China-Malaysia Cooperation on the "Two Countries, Twin Parks" (specifically China-Malaysia Qinzhou Industrial Park and Malaysia-China Kuantan Industrial Park); the China-Indonesia Cooperation on the "Two Countries, Twin Parks" (specifically the Yuanhong Investment Zone in Fuqing; Fujian Province as the Chinese park; and the Bintan Industrial Estate, the Aviarna Industrial Estate, and the Grand Batang City (collectively known as the Indonesian park).
Third, connectivity has been increasingly strengthened. The two sides have advanced the docking of the Belt and Road Initiative with the Master Plan on ASEAN Connectivity 2025 and boosted connectivity. Means of cooperation have been innovated, and a batch of infrastructure projects covering railway, highroad, ports, airports, bridges, and electricity grids have been advanced or completed. The China-Laos Railway started operation and the China-Singapore connectivity project, dubbed the "New International Land-Sea Trade Corridor," have seen remarkable progress.
Fourth, regional economic integration has been accelerated. As you have mentioned, the RCEP took effect on Jan. 1, as scheduled, through the joint efforts of China and ASEAN countries. On the same day, the China-Cambodia Free Trade Agreement also came into force. The two sides have also agreed to upgrade the China-ASEAN Free Trade Area to a higher level so as to promote trade and investment liberalization and facilitation.
In November last year, President Xi Jinping announced the establishment of a comprehensive strategic partnership with ASEAN leaders at the ASEAN-China Special Summit to Commemorate the 30th Anniversary of ASEAN-China Dialogue Relations, which is a new milestone in the history of China-ASEAN relations. Standing at a new historical starting point, we will work with the ASEAN to fully implement the important consensus reached by the leaders of both sides, push China-ASEAN economic and trade cooperation to a new level, and build a closer China-ASEAN community with a shared future.
First, we will deepen trade and investment cooperation. President Xi Jinping announced at the summit that China will import $150 billion of agricultural products from ASEAN in the next five years. We will actively promote the implementation by making good use of exhibition platforms such as the China International Import Expo and the China-ASEAN Expo and expanding the import of agricultural products and other high-quality products from ASEAN. We will better meet domestic needs through these efforts. In terms of investment cooperation, we will focus on expanding cooperation in new fields such as combating COVID-19, digital economy, green and low-carbon growth, promoting successful cooperation models, and jointly building demonstration parks for economic and trade innovation and development.
Second, we will strengthen the connections between industrial chains and supply chains. We will work with all parties to successfully hold the ASEAN Plus China, Japan, and the Republic of Korea (10+3) forum for cooperation on industrial and supply chains, jointly respond to the new situation and challenges of the global industrial chain and supply chains, and promote the coordination, innovation and sustainable development of the regional industrial chain and supply chains. Furthermore, we will continue to encourage the construction of new land-sea corridors and play a supporting role in interconnection, economic and trade cooperation, and industrial and supply chains.
Third, we will improve the institutional arrangements for economic and trade development. We will work with ASEAN and other parties to implement the RCEP well and promote the agreement to enter into force in more countries. We will expedite follow-up talks to complete the upgrading of the China-Singapore Free Trade Agreement within this year. We will actively promote the third version of the joint feasibility study of the ASEAN–China Free Trade Area, expand cooperation in new fields such as the digital economy, strive to start negotiations as soon as possible, and cooperate with ASEAN to build a more inclusive, modern, comprehensive and mutually beneficial free trade agreement.
In conclusion, in the new year, the MOFCOM will continue to deepen China-ASEAN economic and trade cooperation and promote the building of a closer China-ASEAN community with a shared future. Thank you.
_ueditor_page_break_tag_Phoenix TV:
My question is for Mr. Wang. Despite multiple challenges last year, the economic and trade cooperation between China and Europe was taken up a notch. How do you evaluate the current economic and trade relations between China and Europe, and what are your expectations for the future? Thank you.
Wang Wentao:
Thank you for your question on the current state and outlook.
China and the EU are two major independent forces globally with broad strategic consensus and shared interests. We are significant economic and trade partners who complement each other and conduct mutually beneficial and win-win cooperation. In 2021, despite the complex and severe situation, economic and trade cooperation between China and the EU continued a momentum of rapid growth.
Statistically speaking, both the "quantity" and "quality" of bilateral trade have improved. In terms of "quantity," the trade volume between China and the EU has exceeded $800 billion, hitting a record high. China remains the largest trading partner of the EU, and the EU is China's second-largest trading partner. In terms of "quality," the bilateral trade structure has been continuously optimized, and the growth rate of trade in aerospace, biology, optoelectronics, electronics, materials, and other fields has exceeded 30%. In 2021, the agreement between China and the EU on geographical indications took effect. China-Europe freight train trips hit about 1,000 by month and 10,000 by year. Last year, a record 15000 China-Europe freight train trips were made, up 22% from the previous year.
Steady progress has been made in two-way trade. The two-way trade between China and the EU has exceeded $270 billion, and there are sound investments and cooperation in the fields such as finance, vaccine research and development, new energy, electric vehicles, and logistics. China's investment in the EU increased, bucking the trend. According to a European Union Chamber of Commerce survey in China, 60% of the surveyed companies plan to expand their business in China. Nearly half of the surveyed companies' profits in China are higher than the global average. In October last year, I met with the president of the European Union Chamber of Commerce in China. He told me that many companies were optimistic about the Chinese market and China's future prospects and expressed willingness to continue to increase investment in relevant fields.
Meanwhile, economic and trade exchanges have been deepened. Mechanisms for exchanges at all levels, including the China-EU High-level Economic and Trade Dialogue, continue to play a role, and cooperation platforms between local governments and enterprises have become more complete. For example, the 2nd China-Central and Eastern European (CEEC) Countries Expo was successfully held. Four hundred twenty-five companies from CEEC countries participated in the expo, and 7.46 billion yuan of intentional purchases with CEEC were made. In addition, some EU companies actively participated in the 4th China International Import Expo (CIIE). The number of exhibitors, exhibition area, and intentional deals from EU companies accounted for more than one-third. Ireland was the guest country of honor for the China International Fair for Investment and Trade last year. This year, France will be the guest country of honor for the China International Consumer Products Expo this year.
President Xi Jinping pointed out that the two sides should stay committed to the comprehensive strategic partnership and the principle of mutual respect and mutual benefit, so as to ensure consistent, sound, and steady development of China-EU relations. We believe that China's development is an opportunity for the EU, not a challenge, nor a "threat," as some have claimed. We think that China-EU cooperation outweighs the competition. Of course, we also agree that the history, culture, social system, and development stage between China and Europe are different. Therefore, it is not surprising that some differences and divergence of views exist.. However, the two sides can promote healthy competition by strengthening communication. China and the EU are partners rather than rivals.
In the future, we are willing to work with the EU to implement the important consensuses reached by leaders of the two sides, firmly maintain the direction and underlying principle of China-EU economic and trade relations from a strategic perspective, synergize the Belt and Road Initiative with the EU's Global Gateway strategy, expand areas of cooperation, and deepen cooperative mechanisms. The two sides can advance pragmatic cooperation in various fields such as epidemic prevention and control, green development, digitization, finance, and technology, advance the process of ratification and entry into force of the China-EU investment treaty, and inject stability and positive energy into the China-EU relationship.
We can strengthen coordination and cooperation under multilateral frameworks such as the G20, UN, and WTO, promote the implementation of the Global Development Initiative, uphold the WTO-centered multilateral trading regime, and jointly promote the WTO reform in moving in the right direction. We should uphold openness and inclusiveness, reject the zero-sum mentality, oppose protectionism, and deepen market opening-up. We can strengthen cooperation between China and the EU as well as in third-party markets so as to contribute to the economic development of both sides and promote the economic recovery and stability of the whole world. Thank you.
_ueditor_page_break_tag_China News Service:
Establishing pilot free trade zones (FTZs) is an important measure of the CPC Central Committee for advancing reform and opening up in the new era. Through explorations based on differentiated conditions and stress testing, pilot FTZs are expected to accumulate experience for high-standard opening-up. What achievements did the MOF make in promoting the construction of pilot FTZs last year? And what measures will be taken this year to further promote their high-quality development? Thank you.
Wang Shouwen:
Thank you. In July last year, General Secretary Xi Jinping presided over the 20th meeting of the central committee for deepening overall reform. Xi spoke highly of the achievements already made in the construction of pilot FTZs and made clear requirements for future work. The MOF, together with other relevant departments and localities, resolutely implemented General Secretary Xi Jinping's important instructions, and in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, made new progress in the construction of pilot FTZs.
First, we further broadened market access, as Minister Wang Wentao just mentioned, and released China's first negative list for cross-border trade in services in South China's Hainan Free Trade Port. The adoption of the negative list represented a major breakthrough in China's management model of cross-border service trade as well as a major step forward in promoting the further opening up in cross-border trade in services.
Second, we further shortened the negative list for market access of foreign investment in pilot FTZs. As we know, China released the first such negative list in 2013. In 2020, the number of items on the negative list was reduced to 30 after six adjustments. Last year, the number of items was further reduced from 30 to 27. China has kept opening wider to the world in investment.
Third, we rolled out a slew of reform measures to boost trade and investment facilitation. We specifically issued a document to grant pilot FTZs greater decision-making power for reforms with 19 measures to enhance trade, investment, international logistics, and the degree of convenience for the financial sector to serve the real economy and to explore judicial guarantee for trade and investment facilitation. We also issued policy documents to strengthen the protection of the ecological environment, pursue high-quality development, and strengthen fair competition.
Fourth, we continued to achieve institutional innovation. Establishing pilot FTZs is not just for the development of some regions. More importantly, it is to accumulate rich experiences for major national strategies. Last year, we unveiled a new batch of 18 best-practice cases. Until now, China's pilot FTZs have seen their successful practices in 278 institutional innovations promoted on the national level.
Fifth, we promoted the development of pilot FTZs. For example, the pilot FTZs have contributed to the stability of the overall performance of foreign trade and foreign investment. Last year, the use of foreign investment in China's 21 pilot FTZs rose 19%, 4.1 percentage points higher than that of the whole country. Their imports and exports increased by 29.5%, 8.1 percentage points higher than that of the whole country. Although the pilot FTZs are small in size, they contribute 18.5% to the total use of foreign investment in China and 17.3% to the country's imports and exports.
This year, we will continue to resolutely implement General Secretary Xi Jinping's important instructions and further promote the high-quality development of pilot FTZs.
First, we will pilot institutional opening-up in line with international high standards in pilot FTZs and free trade ports with the right conditions. As Minister Wang Wentao mentioned, China already took some new measures concerning free trade agreements, including applying to join CPTPP and DEPA. Drawing on these high-standard free trade agreements, we will step up efforts to explore and promote institutional opening-up in the fields of trade in goods, trade in services, e-commerce and intellectual property rights.
Second, we will promote the formulation and implementation of a negative list for cross-border trade in services applicable to all pilot FTZs. Last year, we issued a negative list for cross-border trade in services in Hainan Free Trade Port. On the basis of this list, we will formulate a negative list that will apply to all the 21 pilot FTZs this year so as to expand the scope of opening-up and accumulate experience for wider opening-up in the future.
Third, the MOFCOM will further support the growth of export-oriented industries and contribute to the dual circulation development paradigm where domestic and overseas markets reinforce each other. We will provide targeted suggestions for pilot FTZs and let them carry out whole-industrial-chain opening up and innovation based on their strategic roles, local conditions, and comparative advantages. We will improve the precision of our work on investment attraction, strengthen the effort on attracting industrial chain investment, and optimize service systems for overseas investment. We will also attract global resources of the industrial chains and accelerate the construction of competitive export-oriented industrial clusters so as to give full play to the leading role of pilot FTZs in carrying out high-level opening up.
Fourth, the MOFCOM will further put forward a new set of measures that are proven to work in pilot FTZs and can be replicated and applied elsewhere. We will give full rein to the initiative of pilot FTZs, strengthen explorations based on their differentiated conditions, and put forward more systemic innovation achievements that can be replicated and applied elsewhere. These achievements should be piloted at the provincial level, and those with fruitful results should be compiled as the seventh volume of reform and pilot experiences. After being approved by the State Council, these experiences will be further promoted across the country. Thank you.
Xing Huina:
Due to time constraints, we will have one last question.
_ueditor_page_break_tag_International Business Daily:
Thank you. China has over 800 million people living in its counties, and this has created huge potential for consumption. In 2021, the MOFCOM worked with relevant government bodies to launch a campaign to build commercial facilities in counties. A layered approach has been taken in light of local conditions. What's the progress so far? What are the key tasks for 2022? Thank you.
Wang Wentao:
I'd like to take your questions.
Frankly speaking, commercial networks at the county level and below are the weak links of China's overall logistics system. Therefore, in 2021, the CPC Central Committee and the State Council made arrangements accordingly, and the MOFCOM and another 16 government bodies launched a campaign to build commercial facilities in counties. The campaign seeks to strengthen weak lines, ensure smooth logistics, improve commercial networks, and diversify business forms. The progress made in 2021 can be summarized in the following aspects:
First, a group of commercial sites was built or renovated. In 2021, we built or renovated 834 county-level comprehensive commercial service centers, 1,858 township-level commercial centers, and 369,000 village-level convenience shops.
Second, a group of logistics delivery facilities was improved. We enhanced the capacity of supply and marketing logistics, postal logistics, logistics enterprises, and e-commerce logistics. We have integrated and optimized the logistics resources, and improved a three-layered logistics system covering counties, townships, and villages. A total 1,212 county-level logistics centers and 14,800 village-level e-commerce parcel stations were renovated in 2021. Currently, 98% of townships and villages in China have direct access to big-brand logistics companies, and parcels can be directly delivered to more than 80% of administrative villages. Products purchased online can be delivered more efficiently to villagers. But there are still problems. Some villages are beyond the reach of the logistics networks. Due to China's vast territory and huge geographical differences and regional imbalances, some villages are hard to reach, and the costs of logistics are comparatively high in some mountainous regions.
Third, logistics channels of agricultural products were optimized and expanded. A total of 1,028 farmers' markets and wholesale markets for agricultural products were renovated. The number of agricultural products traded in wholesale markets increased 8.4% year on year, hitting one billion metric tons. Nevertheless, we need to improve the cold chain logistics for agricultural products, which is currently one of the weakest links in this aspect.
Fourth, the driving role of e-commerce entrepreneurship in boosting employment was further enhanced. Based on a demonstration project that brings e-commerce into villages, we continue to expand the coverage of e-commerce business in villages. In 2021, the online retail sales volume in villages amounted to 2.05 trillion yuan, exceeding the two-trillion mark, up 11.3%. The number of e-commerce entities in villages across China reached 16.33 million by the end of 2021.
Nevertheless, there are still weak links. The magnetic effect of agriculture and commerce is yet to strengthen, and market entities remain small-scaled, randomly scattered, and less-developed. These phenomena haven't changed fundamentally. According to feedback, mainly from rural residents, the high cost of logistics is still a prominent problem.
In addition, the commercial development across China is also varied. Take our campaign of building commercial facilities in counties, for example. For regions with sound development basis, the gap between commercial facilities in counties and mid-sized and big cities is narrowing down, and the integration between them is deepening. We have also seen progress in applying digital technologies in commercial facilities and creating new business forms in counties, but there is still room for improvement compared with the situation in developed cities. However, for underdeveloped regions with poor development basis, their weaknesses and problems are more prominent, and commercial facilities there cannot meet the local needs of daily life and production. We have been continuously making improvements by adopting a problem-oriented approach, strengthening coordination at the county level, and enhancing the leading role of the market. We have been implementing various tasks and continuously strengthening support for commercial facilities, logistics, the circulation of agricultural products, and cold chains. We have been working to promote the sales of agricultural products in cities and bring supply chain, logistics, and commodity services in counties and villages so as to further consolidate our efforts in the campaign of building commercial facilities in counties. Thank you.
Xing Huina:
Today's press conference is hereby concluded. Thank you to all the speakers and friends from the media. Goodbye.
Translated and edited by Cui Can, Wang Yanfang, Duan Yaying, Li Huiru, Zhang Rui, Liu Sitong, Zhang Tingting, Liu Qiang, Wang Yiming, Ma Yujia, Zhu Bochen, Chen Xia, Yang Xi, Wang Qian, Zhang Liying, Yuan Fang, Dong Qingpei, Jay Birbeck, David Ball and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Xiao Yaqing, minister of industry and information technology
Xin Guobin, vice minister of industry and information technology
Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT)
Chairperson:
Shou Xiaoli, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
Feb. 28, 2022
Shou Xiaoli:
Ladies and gentlemen, good morning. Welcome to this press briefing being held by the State Council Information Office (SCIO). Today, we have invited Mr. Xiao Yaqing, minister of industry and information technology, to brief you on promoting the steady operation and quality upgrading of industry and information and communication technologies (ICTs), and to answer your questions. We also have with us Mr. Xin Guobin, vice minister of industry and information technology, and Mr. Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT).
Now, I will give the floor to Mr. Xiao Yaqing.
Xiao Yaqing:
Ladies and gentlemen, friends from the media, good morning. I'd like to begin by thanking you for your attention and support for developing the industry and information technology sector. Together with my colleagues, I'm also glad to speak with you on promoting the steady operation and quality upgrading of industry and ICTs.
As we all know, 2021 was an extraordinary year, marking a milestone in the history of the Communist Party of China (CPC) and the country. Over the past year, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the Party and the country have achieved new and major achievements in various undertakings. China has taken a leading position in both economic development and pandemic control worldwide, and new steps have been taken to build a new development pattern. New results have been achieved in high-quality development, and the implementation of the 14th Five-Year Plan is off to a good start.
Earnestly carrying out decisions made by the CPC Central Committee and the State Council, the MIIT has forged ahead, overcome difficulties, redoubled its efforts, and effectively responded to risks and challenges. Under the complex and severe situation, the outlook for the industry and information sector is positive, which has contributed to economic and social development. This is mainly reflected in the following aspects:
I. The industrial economy saw sustained recovery and development. Here are some figures:
First, the added value of industries above designated size increased by 9.6%, an increase of 6.8 percentage points over 2020, or an average two-year growth rate of 6.1%. Among them, the added value of the manufacturing industry increased by 9.8%, with an average two-year growth rate of 6.6%. The added value of the manufacturing industry accounted for 27.4% of GDP, with a total amount of 31.4 trillion yuan, ranking first in the world for 12 consecutive years.
Second, the profits of industrial enterprises above designated size increased by 34.3%, an increase of 30.2 percentage points over the previous year, or an average two-year growth rate of 18.2%.
Third, the national industrial capacity utilization rate came in at 77.5%. This is a relatively high level for recent years.
II. The resilience of the supply and industrial chains has been improved. Efforts have been made to solve problems that affect industrial chains and supply chains, and key industrial chains remain safe and stable. The international competitiveness of industrial chains in areas such as photovoltaics, wind power and shipping have been further enhanced. The volume of containers, once in shortage, more than doubled last year, up by 110.6%. Chip production also rose by 33.3%. The export delivery value of industrial enterprises above designated size logged a year-on-year increase of 17.7% and a two-year average increase of 8.3%, which is a high level for recent years. Exports of China's industrial products have made an important contribution to the response to the COVID-19, maintaining the stability and smoothness of the global industrial and supply chains, and promoting the recovery and growth of the global industrial economy.
III. The industrial structure was further optimized and upgraded. This can be seen from three aspects:
First, the leading role of the high-tech manufacturing industry and equipment manufacturing industry has been significantly enhanced, with the added value increasing by 18.2% and 12.9%, respectively. Their contribution rates to the growth of the above-scale industry reached 28.6% and 45%, respectively.
Second, the pace of digital and green transformation of the manufacturing industry has accelerated, and new progress has been made in cluster development. The numerical control rate of key processes of above designated size in key areas was 55.3%, and the penetration rate of digital research and development and design tools was 74.7%. All indicators showed a positive trend. We can also see that energy consumption of the added value of industrial enterprises above designated size decreased by 5.6% year on year, which is also good news.
Third, the guiding role of leading enterprises has been significantly enhanced, and the development pace of small- and medium-sized enterprises (SMEs) that focus on specialization, refinement, uniqueness and innovation has been accelerated. We have incubated more than 40,000 enterprises that focus on specialization, refinement, uniqueness and innovation, over 4,700 "little giant" enterprises, and more than 800 single-product specialists in the manufacturing industry.
IV. New achievements have been made in the innovation and development of key areas, and new breakthroughs have been made in major technological innovations. The Tianwen-1 probe completed orbiting, landing and roving during an exploration mission to Mars, the Shenzhou-12 and Shenzhou-13 manned spaceships were successfully launched, and the Haidou-1 submersible broke many world records. The demonstration plant of the high-temperature gas-cooled reactor was connected to the grid for the first time to generate electricity, and research into new types of displays, machine tools, new materials and other fields has achieved phased results. All of these have strongly supported the development of the industrial economy. Industrial robots and solar cells increased by 44.9% and 42.1% year on year, respectively, and the production and sales of new energy vehicles increased by 1.6 times year on year.
V. New progress has been made in the high-quality development of the information and communications industry. The construction of new information infrastructure has been intensified. A total of more than 1.43 million 5G base stations have been set up and opened, and the number of 5G mobile phone terminal connections has reached 520 million. Full 5G coverage has been achieved across all venues for the 2022 Winter Olympics, providing strong support for the creation of an intelligent Winter Olympics. Spectators found that these measures greatly improved the viewing experience. 5G applications are also rapidly expanding in such fields as industry, energy and transportation, empowering thousands of industries. New formats and models have emerged one after another. The digital economy is showing a strong growth momentum. For the past year, the business revenue of the communications industry, and software and information technology services industry increased by 8% and 17.7%, respectively. All these provide the basis for us to stabilize the industrial economy throughout the year, and also lay a good foundation for this year.
While seeing achievements, we also clearly realize that there are still many problems. For example, the core competitiveness of the manufacturing industry is not strong enough, the quality of the supply system needs to be improved, and there are still many problems related to the security and stability of the industrial chain and supply chain. In particular, the current external environment is more complex, severe, and uncertain, and domestic development is also facing the triple pressure of demand decrease, supply shock, and weakening expectations. The difficulties and challenges faced by the development of industrialization and informatization have increased. We will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and deeply understand the decisive significance of the "Two Establishments," keep in mind "the Nation's Most Fundamental Interests," strengthen the "Four Awarenesses," adhere to the "Four Confidences," achieve the "Two Upholds," carry forward the great founding spirit of the CPC, conscientiously implement the spirit of the Central Economic Work Conference and the decisions and arrangements of the CPC Central Committee and the State Council, adhere to the general principle of seeking progress while maintaining stability, fully, accurately, and comprehensively implement the new concept for development, build a new development pattern, and promote high-quality development. We will uphold the supply-side structural reforms as the main task, coordinate the COVID-19 pandemic prevention and control as well as economic and social development, and coordinate the development and security, implement the tasks of "Six Stabilities" and "Six Guarantees," and put the stable growth of the industry in an important position, focus on boosting the industrial economy, and especially, go all-out to achieve a stable continuity in the first quarter and promote the smooth running of the industrial economy. We will focus on promoting innovations and breakthroughs in basic and key areas, further enhance the resilience of the industrial and supply chains, and focus on increasing relief assistance to SMEs, foster enterprises to become ones with high growth potential, advanced technology and strong market competitive edge, continue to stimulate the vitality of market players. We will focus on strengthening the construction and application of new information infrastructure and improve the supply capacity of information and communication services. We will focus on promoting the in-depth development of the digital transformation of the manufacturing industry, and enhance the new advantages and new dynamic of industrial development. We will focus on the implementation of work for carbon peaking and carbon neutrality, implement the carbon peaking action in the industrial field, and improve the level of green and low-carbon development of the industry. We will follow the requirements of "Three Stricts and Three Earnests," and do a solid job of implementing each work one by one, promote the smooth operation and quality upgrading of industrialization and informatization, keep the proportion of the manufacturing industry basically stable, and enhance the core competitiveness of the manufacturing industry and build a solid economic "ballast stone." We will welcome the successful convention of the 20th CPC National Congress with excellent achievements.
Above is my brief introduction, and then my colleagues and I will answer the questions from you.
_ueditor_page_break_tag_Shou Xiaoli:
Thank you, Mr. Xiao, for your introduction. Let's move on to the question-and-answer session.
CCTV:
Mr. Xiao, you just mentioned in your introduction that you will try your best to achieve a stable continuity in the first quarter and promote the smooth running of the industrial economy, build a solid economic "ballast stone." What is the trend of China's industrial economy in the first two months of this year? Next, what measures will the MIIT take to achieve a good start in the first quarter and a smooth running of the industrial economy throughout the year?
Xiao Yaqing:
Thank you for your questions. In general, after efforts from various aspects, so far, China's industrial economy has continued the trend of a steady recovery in the fourth quarter of last year, and the overall operation is stable. Particularly with the implementation of various policies and measures for the growth of the industrial economy, phased results have been achieved in boosting the industrial economy. I don't have the statistics for February yet, but today is the last day of this month, so I would like to introduce the following aspects:
The first is the production during the Spring Festival and the resumption of work after the festival. Our questionnaire survey on more than 20,000 key industrial enterprises showed that 14.5% of enterprises didn't stop production during the Spring Festival, 89.5% of enterprises resumed work before the Lantern Festival, the 15th day of the first lunar month, and 95.5% of enterprises resumed work before Feb. 20. The second is the production and operation of enterprises in key industries in January. According to statistics from relevant associations, the production and sales of automobiles in January were 2.422 million and 2.531 million, respectively, up 1.4% and 0.9% year-on-year, respectively. Among them, the production and sales of new energy vehicles were 452,000 and 431,000, an increase of 1.3 times and 1.4 times, respectively. According to monitoring by the China National Coal Association, the average daily output of coal by key coal enterprises reached 7.44 million tons in January, a year-on-year increase of 1.8%. In January, the SMEs development index was 89.4%, up 0.2% month-on-month, and kept rebounding for three consecutive months. The third is about the situation of industrial-related indicators. The manufacturing PMI in January was 50.1%, which maintained above 50% for three consecutive months; the prosperity index of China's logistics industry was 51.1%, which also remained in the prosperity range; the scale of newly increased social financing and RMB loans both hit record highs and newly increased medium and long-term corporate loans showed a year-on-year increase for the first time since July last year.
Of course, we must also see that, affected by multiple factors, the current situation of the stable recovery of the industrial economy is not yet solid, and great efforts are still needed to promote the smooth operation of the industrial economy.
In the next step, first, we will make every effort to boost the industrial economy and ensure smooth continuity of the first quarter. We will conscientiously implement a series of policies and measures to promote the steady growth of the industrial economy, strengthen policy support, and promote the implementation of various policies and measures. At the same time, we must remain vigilant in identifying potential problems and solve them in a timely and coordinated manner.
Second, we will focus on breaking through the block on the supply of key products. And we will strengthen the guarantee and coordination of energy, logistics, labor, and other factors, give priority to ensuring the stable operation of key enterprises such as basic industrial products and important living materials, including agricultural materials and fertilizers.
Third, we will actively boost effective investment in manufacturing. We will ensure the implementation of major programs and projects in the 14th Five-Year Plan and start the implementation of a number of industrial infrastructure re-establishing projects. We will encourage and support enterprises to strengthen technological transformation, and promote telecom operators to accelerate the progress of investment and construction for 5G and gigabit optical networks.
Fourth, we will take concerted measures to expand consumer demand. We will continue to implement policies such as subsidies for the purchase of new energy vehicles, incentives and subsidies for charging facilities, and reduction and exemption of vehicle and vessel taxes. At the same time, we will carry out activities of bringing new energy vehicles, green smart home appliances, and green construction materials to the countryside. We will also further promote the action of increasing varieties, improving quality, and creating brands for products, and fully support foreign trade enterprises to expand exports. Thank you.
_ueditor_page_break_tag_Science and Technology Daily:
Now more and more enterprises have realized the importance of digital transformation, and they are also accelerating the pace of digital transformation. We know that last year the MIIT focused on accelerating the digital transformation of China's manufacturing industry. I would like to know, as the industry's competent authority, how effective were the efforts in this regard? Secondly, what measures will the ministry take in the next step to support the digital transformation of enterprises? Thanks!
Tian Yulong:
Thanks for your question. As you said, the digital transformation is mainly about the popularization and application of the new generation of information technology, which will bring profound changes to production modes, development models, and enterprise forms in the manufacturing industry. It should be a compulsory course for enterprises to improve and develop their competitiveness. In recent years, thanks to joint efforts of the MIIT, relevant departments, and local governments, the digital transformation of China's manufacturing industry has seen accelerated development and good trends in innovation activities. It can be embodied in the following three aspects:
First, the foundation of the digital transformation has been consolidated. Through the implementation of the industrial internet innovation and development projects, more than 150 comparatively large-scale industrial internet platforms have been incubated, serving more than 1.6 million industrial enterprises, which provided strong support for digital transformation. Second, the scope of the digital transformation has been expanded. The new generation of information technology, including 5G, big data, cloud computing, and artificial intelligence, has accelerated integration and penetration with the manufacturing industry. Especially in industrial sectors like steel, automobiles, equipment, electronics, and petrochemicals, integrated and cross-industry innovations have been deepened. More than 2,000 "5G + Industrial Internet" projects are under construction across the country. Third, the degree of digital transformation has been enhanced. Just now, Mr. Xiao mentioned that the numerical control rate of key processes reached 55.3% among industrial enterprises above designated size, and the popularizing rate of digital R&D tools reached 74.7%. New forms and models of digital businesses also developed and innovated. The proportion of enterprises engaged in internet-based collaboration and service-oriented manufacturing reached 38.8% and 29.6%, respectively. Through internet-based and digital-driven transformation, enterprises not only improved their quality, efficiency, and effectiveness, but also gained benefits and improved their industrial competitiveness.
Next, we will continue our previous work and mainly focus on the following three aspects.
First, we will highlight key points and enhance enterprises' digital capabilities. Enterprises are the main body of digital transformation and reconstruction. At present, the digital capabilities of enterprises are generally not strong enough, which requires us to further promote and support them. We will summarize and promote a number of good technologies and practices, and issue relevant guidelines and guidance by industry and field. We will cultivate a group of high-quality system solution suppliers to provide practical and effective typical cases and methods for enterprises. Meanwhile, leading enterprises in the industry are supported to build digital empowerment platforms for the development of SMEs, and combine the optimization of industrial and supply chains, playing the role of digital transformation. By the end of this year, we will work with relevant parties to provide digital transformation services for at least 100,000 SMEs, and enable them to operate businesses on cloud platforms.
Second, we will expand applications and enrich product supply. We will continue to implement industrial internet innovation and development action plans, explore a number of typical application scenarios of "5G + Industrial Internet," and build a batch of fully 5G-connected factories. We will also accelerate the access of the industrial internet platforms to bases, industrial parks, and industrial clusters so as to connect various industries and empower enterprises and industrial parks.
Third, we will build and optimize the environment for digital transformation, which is a very important foundation for digital transformation. The standard system of transformation should be further improved. We will improve the talent training system for manufacturing transformation and further deepen the integration of industry and education and school-enterprise cooperation. At the same time, we will work with financial institutions to enrich financial products for digital transformation so as to further reduce the cost of enterprises' digital transformation. It is important to strengthen data security in digital transformation. We will actively foster the data factor market and support the establishment of data exchanges in Beijing and Shanghai. We will also strengthen industry data security supervision and formulate data catalogs to strengthen protection.
That's my answer. Thank you.
_ueditor_page_break_tag_Cover News:
How do you see the outstanding performance of China's new energy vehicle industry over the last year? Will such achievements continue this year? Regarding this industry, what's China's focus for its development going forward?
Xiao Yaqing:
Thanks for your question. Mr. Xin will answer it.
Xin Guobin:
Thank you. China's new energy vehicle industry developed relatively fast during the 13th Five-Year Plan period (2016-2020). Its annual sales increased from 507,000 in 2016 to 1.367 million in 2020, with an average annual growth rate of 28%. Last year, the industry witnessed an outstanding performance. The number of its output and sales of vehicles both exceeded 3.5 million, reaching 3.545 million and 3.521 million, respectively, up 1.6 times year-on-year, ranking it first in the world for seven consecutive years, with a cumulative promotion volume of over 9 million units. Since the achievements of the new energy vehicle industry in 2021 have exceeded the predictions of some experts and institutions, the public must be concerned about whether it can maintain its encouraging development trend this year. Recently, we conducted a series of research and surveys, which showed that the development of new energy vehicle industry is in line with the direction of green and low-carbon development. It has led to the expansion of industry chains such as power batteries, electric motors, and electric controls; accelerated the application of new technologies, including intelligent cockpits, automatic driving, and intelligent networks; and promoted the transformation of logistics and transportation, which brought a new experience of green travel to consumers. The ecosystem of industrial development has been gradually improved. Judging from all aspects, China's new energy vehicle industry has entered a new stage of large-scale and rapid development. Although the development is still facing some difficulties and challenges, it is expected to maintain a high growth trend this year. Next, the MIIT will give full play to the inter-departmental joint meeting mechanism on energy saving and the new energy vehicle industry and focus on the following five aspects.
First, we will improve support policies. We will step up efforts to clarify support policies such as extending purchase tax exemptions for NEVs. We will improve the "dual-credit" policy and make it effectively dovetailed with the decline of subsidies for NEV purchases to stabilize market expectations. We will compile a roadmap for the green development of the automobile industry and provide guidance and assistance to industries and companies.
Second, we will support innovative breakthroughs. We will promote the integration of electrification and intelligent, connected technologies, improve the safety, low temperature adaptation and other performances of storage batteries, step up the technological application of 5G and the vehicle infrastructure cooperative system, and develop more functions such as leisure and entertainment, life services and autonomous driving to meet the needs of consumers. We will continue to improve the product quality and driving experience of NEVs to boost consumers' sense of gain.
Third, we will promote market expansion. We will launch the pilot project in some cities to completely electrify vehicles used in the public service sector, and step up the electrification of urban logistic vehicles, taxis and sanitation trucks. Focusing on the problem of charging in old residential areas and expressways which people urgently require solving, we will work with other departments to accelerate the construction of charging and battery swap stations and other infrastructure, and promote information sharing and unified settlement to continuously improve the convenience of charging NEVs.
Fourth, we will strengthen the guarantee of resources. We will strive to meet the production requirements for storage batteries, moderately accelerate the development of domestic lithium resources, and crack down on unfair competition such as hoarding and price gouging. Meanwhile, we will improve the system of storage battery recycling, support high-efficiency dismantling, recycling and other technological breakthroughs to continuously improve the recycling rate and resource utilization efficiency.
Fifth, we will strengthen safety supervision. We have always emphasized that safety is the prerequisite for the development of the NEV industry and that it cannot develop without safety guarantee. Therefore, we should stick to the bottom line, and improve our capabilities to guarantee functional security, data security, and network security in a comprehensive way. We will continue to improve NEV safety and technical standards, and improve battery thermal runaway warnings and the level of safety protection. We will build a systematic, scientific and standardized NEV safety management system so that consumers can be more confident about using NEVs. Thank you.
_ueditor_page_break_tag_Nikkei:
What measures has China taken in the past five years to improve the industrial chains for integrated circuits and semiconductors? How do you expect the level of China's self-sufficiency in semiconductors to improve by 2025? By approximately what percentage?
Tian Yulong:
Thank you for your questions. The integrated circuit industry has attracted global attention, and the CPC Central Committee and the State Council have attached great importance to it. In 2020, the State Council released policies on promoting the high-quality development of the integrated circuit and software industries in the new period, and put forward many important measures to develop the integrated circuit industry. The MIIT has worked with relevant departments and local governments to actively implement these policies. They have played an important role in the development of China's integrated circuit industry, especially in stabilizing the industrial and supply chains for integrated circuits. This can be seen in three aspects:
First, we have worked with other departments to release the first list of duty-free products for the integrated circuit industry and issued a circular about the conditions for companies to enjoy relevant policies. Domestic and foreign companies will enjoy the policies equally. Our purpose is to support integrated circuit companies of different ownerships to advance the development of the sector.
Second, we have encouraged technological innovation. We have guided local governments to set up manufacturing innovation centers, improve their technology supply capacity, and speed up the transfer application and commercialization of new technologies, new processes and new equipment in particular. Meanwhile, we have set up relevant standards to promote the application and quality evaluation of integrated circuits, and further increased their application and promotion in automobiles, medical care, energy and other fields to drive the rapid development of the integrated circuit industry via applications and markets.
Third, we have fostered a sound development environment for the integrated circuit industry. We have given full play to the role of capital in driving industrial development, and guided and encouraged social capital to invest in the integrated circuit industry. In particular, in accordance with various policy requirements, we have strengthened the protection of intellectual property rights and created a market-oriented, law-based and international business environment. The MIIT and the Ministry of Education have encouraged universities to establish the major of integrated circuits as a first-class discipline, build high-level microelectronics colleges, strengthen school-enterprise cooperation, and cultivate high-quality talents.
The integrated circuit industry is an intelligence-intensive industry. In the future, integrated circuits will continue to be a highly globalized industry, which highlights the importance of strengthening cooperation in global industrial and supply chains. The industries of various countries should strengthen the division of labor and cooperation, so that integrated circuit technologies will continue to develop and the market will keep expanding.
China is the world's largest and fastest growing integrated circuit market, which provides broad market opportunities for the development of global enterprises. At the same time, we have been an important producer and supplier of integrated circuits, and have made continuous contributions to the global integrated circuit industry. Therefore, guaranteeing the stability of industrial and supply chains not only helps support China's self-sufficiency, but also provides resources for global development. We welcome the global integrated circuit industry to increase its investment in China, conduct various forms of cooperation, and jointly contribute to stabilizing industrial and supply chains for the global integrated circuit industry. We will continue to provide good policies and market environments for both domestic and international integrated circuit enterprises, treat all types of market entities equally, offer the same treatment for domestic and overseas investments, and especially enhance intellectual property protection. We will also jointly promote the innovation and development of the integrated circuit industry, and maintain the stability of industrial and supply chains for the global integrated circuit industry. Thank you.
Xiao Yaqing:
I would like to just add one point. As I said, the industry grew 33.3% last year, which represents relatively fast growth. This year, with the advance of industrial digitization and digital industrialization, and the 'increased demand for consumer electronics, we estimate that the industry will have relatively high growth rate among the 31 major manufacturing categories. Mr. Tian mentioned the issue of international industrial cooperation, which is very typical in this industry. We believe this is a major trend and should be adhered to. Thank you.
_ueditor_page_break_tag_CNR:
SMEs have been significantly affected by the pandemic. We have noticed that a series of tax and fee reduction measures have been introduced at the national and local levels to ease their difficulties. With the support of these policies, what is the current situation of SMEs? What measures will the MIIT take to further support their development this year?
Xiao Yaqing:
Thank you for your questions. The CPC Central Committee and the State Council have always attached great importance to the development of SMEs, and have issued a series of policies and measures to help solve the difficulties faced by SMEs and stimulate their vitality. With the support of various polices, especially under the efforts made by SMEs themselves, the operating income and total profit of industrial SMEs above designated size increased last year by 19.9% and 25.6%, respectively, with average two-year growth rates of 9.9% and 16.8%. Both are higher than the levels of 2019 before the pandemic. The survey we conducted on 27,000 SMEs shows that the resumption of work after this year's Spring Festival was satisfactory. I reported on the status of the resumption of work before the Lantern Festival. At the same time, we are also aware that the economic situation at home and overseas has been severe and complex. The foundation for the development of SMEs has not yet been stabilized. In particular, disrupted by the sporadic resurgences of COVID-19, insufficient market demand, rising costs, difficulties in collecting accounts receivable, problems in recruiting workers and other issues have been quite prominent. In order to further help SMEs, we will take the following measures:
First, we will attach greater attention to implementing policies, and promote detailed implementation of policies that benefit enterprises. The central government has introduced many policies and measures to help SMEs. Since last year, 25 such policies have been promulgated at the national level, and 52 series of policy measures have been issued at the provincial level. We will strengthen overall coordination, increase policy publicity and interpretation, so that SMEs can have a better understanding of these policies, and the way to better use them. We will conduct third-party assessments into the development environment of SMEs, and jointly implement the policies of fiscal taxation, financial credit and guaranteeing stable prices, in order to ensure SMEs benefit from the policies.
Second, we will do more to provide enterprises with accurate services and help them solve problems. In response to the demands of SMEs, we will continue to provide them with accurate services in conjunction with relevant departments and regions. We will initiate a "Benefiting Enterprises Together" nationwide service action to provide public services to SMEs, and continue the SMEs Service Month campaign. We will also hold the China International SME Fair and the APEC SME Technology Exchange and Exhibition, and mobilize all sectors to serve SMEs well. We will take measures to clear arrears owed to SMEs, and protect the legitimate rights and interests of SMEs in accordance with the law. There are still many large enterprises and institutions that have defaulted on payments to SMEs, which is the focus of our rectification work this year. At the same time, we should work to ease difficulties and the high cost of financing. We need to guide financial institutions to increase support to micro, small, and medium enterprises (MSMEs), and encourage SMEs to increase the total amount of financing, expand the scope of benefits and lower financing costs.
Third, we will encourage SMEs to focus on their specialisms in niche sectors, and support more SMEs to become suppliers of unique products and experts in complementary services. This year, there are plans to cultivate another 3,000 national-level specialized "little giant" firms, and encourage provinces to foster SMEs with specializations and to bring the number up to 50,000. According to the data, the total sales volume, profits and innovation capacity of the SMEs and "little giant" enterprises that specialize in niche sectors have significantly improved compared with ordinary ones. We will focus on supporting the development of such enterprises around the industrial chain, and better guide and encourage leading enterprises to support the development of SMEs. We will launch a campaign to promote integrated innovation among large, medium and small-sized enterprises. We will also encourage them to open up their innovative resources, including technologies, markets, standards and human resources in accordance with the market and the rule of law. Thank you.
_ueditor_page_break_tag_21st Century Business Herald:
The latest data shows that the shortage of chips in the automobile industry has been eased. Has MIIT made assessments for the crunch situation this year? How will the automobile industry respond to this issue this year? What are the further plans for the chip industry?
Xin Guobin:
Thank you for your questions. Car chip has become a frequently discussed issue in our society since the outbreak of the COVID-19 pandemic. The MIIT has paid great attention to the work regarding chips, and researched with related sectors to address the issue. We set up a working group to expand and apply automotive semiconductors, and strengthened demand-supply links between car, components and chip enterprises; implemented measures in the circular to manage and facilitate services for enterprises, and promote substitute products' application; and coordinated with relevant departments to crack down on speculation and price pushing and other illegal activities, thus raising the supply capacity of chips and striving to maintain the smooth functioning of the automobile industry.
Through joint efforts, significant achievements have been made in car chip supply, with a favorable momentum emerging in monthly production and sales since the fourth quarter of last year. In 2021, 26.082 million and 26.275 million cars were produced and sold, with a year-on-year increase of 3.4% and 3.8%, respectively, ending a period of continuing reduction for three consecutive years, which was a hard-earned outcome. In January 2022, 2.422 million and 2.531 million cars were produced and sold, up 1.4% and 0.9% year-on-year, respectively. It's fair to say that the automobile industry has gotten off to a stable start this year.
Regarding the monitoring data of key car enterprises, there still exists certain chip shortages considering the demands and production plans of both car and components enterprises, although chip crunch is mitigating. Major chip enterprises worldwide have strengthened their production and supply of automotive-grade chips and will gradually release new production capacity this year. In addition, the domestic supply capacity of certain types of chip products are increasing. Therefore, chip supply's favorable momentum is expected to continue.
Next, we will take a slew of measures to maintain the steady operation of the automobile industry, with the focus being as follows:
First, we will strengthen the demand-supply connections. We will create online link platforms for car chips based on our past efforts, provide information channels for chip production and supply, and improve the upstream and downstream cooperation mechanism of the industrial chain.
Second, we will intensify coordination efforts. We will guide car and components enterprises to improve their supply chain, make rational production plans, support each other, improve the efficiency of resource allocation, and minimize the impact of the chip crunch. Allocation efficiency is quite important. Some enterprises' products are sold fast, so the chip crunch will have a big impact on them, but some enterprises' products are not recognized by consumers, so even if they get chips, people won't buy their products, and this will result in a mismatch of resources in the industry.
Third, we will boost the capacity of chip supply. We will further support coordination and innovation among car, components and chip enterprises, so as to improve domestic chip production and supply capacity in a prudent and orderly manner. Presently, our application testing and assessment system is not sound, so we will make further efforts to remedy the deficiencies.
Fourth, we will advance international cooperation. As the automobile industry is a highly internationalized industry, we must carry out globalized development, stimulate transnational chip enterprises to increase supply to the Chinese market, intensify the distribution of domestic production capacity, and strengthen the resilience and stability of the industrial and supply chains.
Mr. Tian Yulong has just introduced the planning of the whole chip industry, and I will add some points regarding your questions.
The CPC Central Committee and the State Council issued the Measures on High-quality Development of Integrated Circuits and Software Industries in a New Era. Next, we will focus on implementing the policy. We will promote the free flow of production factors and resources, create a fair and just market environment, intensify intellectual property rights protection, and deepen international coordination, thus further improving the high-quality development of the industry. Thank you!
_ueditor_page_break_tag_Hong Kong Economic Herald:
It's very nice to see you again, Mr. Xiao. The last time I interviewed you was in 2019, when ministers took questions from the media during the "two sessions." My question this year is about advanced manufacturing. Feb. 26 marks the eighth anniversary of General Secretary Xi Jinping's proposal on the coordinated development of the Beijing-Tianjin-Hebei region. What's the MIIT's take on narrowing down the gap between north and south China in developing advanced manufacturing, especially supporting Tianjin to further build itself into an R&D center for advanced manufacturing? Thank you.
Xiao Yaqing:
The manufacturing gap between the north and south is your personal opinion. China has a full-fledged industrial system. Industries classified into 41 divisions, 207 groups, and 666 classes are well allocated across China. China is the only country in the world to obtain all the divisions of industrial classification. The complete industrial system has made significant contributions to the growth of the national economy and meeting people's everyday needs.
With the development of the market economy, there are some regional differences due to the varied rates of growth and marketization. This is a common phenomenon of development. The CPC Central Committee and the State Council have introduced many measures to advance coordinated regional development. The implementation of these measures provides key guiding principles and fundamental support for the sustainable and sound development, and more effort should be made in the implementation process.
In the meantime, we also need to know that, as a business environment that is based on market principles, governed by law, and up to international standards gradually takes shape in China, more opportunities have been offered to more enterprises, especially those with industrial foundation and advantages. As China continues to deepen reform, the leading enterprises in different industries and advantageous enterprises will emerge with renewed vitality and provide sound support to the development of these industries and enhance their core competitiveness.
We believe that, with the further implementation of the 14th Five-Year Plan and China's regional development strategies, practitioners of China's industrial sector will keep striving to improve, and the sector will see new and more promising prospects. Thank you.
_ueditor_page_break_tag_People's Posts and Telecommunications News:
Over the years, mobile internet users have paid more and more attention to user experience. What efforts did the MIIT make in 2021 to protect users' rights and interests and improve relevant services? What new measures will be taken this year? Thank you.
Xiao Yaqing:
Thank you for your questions. With the rapid development of the mobile internet, people find it increasingly difficult to live and work without cellphones and mobile internet. In 2021, we played our part in the nationwide campaign which aims to bring tangible benefits to the public and worked to improve all aspects that affect user experience. We continuously enhanced the quality of services, strengthened personal information protection, and earnestly protected users' rights and interests. We mainly solved problems concerning the management of mobile apps and the senior-friendly transformation of apps and websites. In terms of mobile app management, many problems were reported. By taking a set of measures such as formulating standard testing techniques, launching special regulatory campaigns, and the self-regulation of industries, we managed to crack down on apps violating regulations regarding collecting and using personal information, as well as pop-ups and other behaviors that violate users' rights and interests. We all found it very difficult to close out pop-ups. In 2021, we tested 2.08 million mobile apps. A total of 1,549 regulation-violating apps were notified and the 514 apps that refused to make corrections were removed from app stores. After rectification, these apps will provide better services for users. In terms of elderly-friendly transformation, a total of 227 websites and apps have completed transformation and introduced functions such as font enhancer, voice guidance, and one-click customer service connection, to name a few. We also provide guidance for digital product companies and let them support the design and production of elderly-friendly digital products.
Of course, our work in this regard will not stop here, and we will continue making efforts this year.
First, we will focus on users' rights and interests and strengthen comprehensive management. We will continuously pay attention to various violations reported by users and carry out further regulatory work on mobile apps. We will implement all-around supervision on various aspects concerning mobile internet services. Our supervision work will mainly cover three fields. These include various end products such as cellphones and tablets, key participants along the accountability chain such as app stores, third-party software development kits and pre-installed apps, and the technical test of mobile apps. By doing so, we aim to comprehensively safeguard users' rights and interests.
Second, we will focus on services and meet users' expectations. We will work to enhance the capacity of personal information protection and urge major internet companies to set up customer helplines and respond to customers' requests.
Third, we will focus on key groups of users and promote the inclusiveness of information services. We will organize more mobile apps and websites and carry out elderly-friendly and barrier-free transformation and improvement, and work to introduce a group of model projects accordingly.
Fourth, we will focus on developing long-term mechanisms and form synergy among our work. Centering on key aspects such as mobile internet services and personal information protection, we will further improve both incentive and accountability mechanisms, strengthen technical methods, and encourage companies to improve their services and other capacities. Thank you.
_ueditor_page_break_tag_Yicai:
Ranking first among new types of infrastructure facility, 5G is an important method to stabilize investment and economic growth. What are the MIIT's plans this year concerning the construction and application of 5G? Thank you.
Tian Yulong:
Thank you for your question. Since the commercial use of 5G technology officially kicked off, it has, as you mentioned, played a crucial and leading role in promoting new infrastructure. Due to the joint efforts of the MIIT, other government bodies, local governments, and the industrial sector, China's 5G construction and application remains world-leading. Currently, the 5G network has covered all prefecture-level cities, the urban area of all counties, as well as 87% of seats of townships and towns. The 5G coverage in China is definitely world-leading. This has played a vital role in stabilizing economic growth and investment.
This year is a critical year for the scale development of 5G applications. According to the overall plans of the Central Committee of the Communist Party of China (CPC) and the State Council, we will mainly continue our efforts for the integrated development of the network, applications, and the industry.
First, we will make solid progress in the development of the 5G network. Our goal is to build more than 600,000 5G base stations this year. As Mr. Xiao just mentioned, we now have over 1.42 million 5G base stations, so we can bring the total number to 2 million by the end of this year. We will constantly expand the scale of infrastructure building, , optimize the layout of infrastructure based on the needs, and cover more key areas such as factories of companies and industrial parks with the network. At the same time, we will improve the penetration of the network into high-speed trains, transportation hubs, shopping centers, and other densely-populated areas, and continue expanding its coverage in counties, towns, and townships.
Second, we will vigorously promote the innovative development of 5G applications. We will further implement the action plan for 5G applications dubbed "Raising the Sail," which is a key element of our effort. We will successfully hold the 5G application competition dubbed "Bloom Cup" to explore more new achievements and technologies and promote their wide application and commercialization. At the same time, guided by the needs of the industry, we will further develop demonstrative application scenarios for 5G plus industrial internet, pilot 5G plus medical and health care, and 5G plus smart education, and continue to deepen and expand our efforts in agriculture, culture, and tourism. We will launch a number of new smart terminals and apps for individual users to further improve their 5G experience.
Third, we will vigorously upgrade 5G technologies. We will intensify research and development (R&D) on key chips and core components, support relevant sectors to actively participate in formulating international standards, and aligning with them. At the same time, we will continue R&D and experiments on 5G enhancement and boost their capacity for integrating with other industrial verticals. We will increase the variety of 5G application products and motivate companies to work out more modular products of different levels and prices so as to meet the needs of different industries, different areas, and the general public for differentiated, customized, and personalized 5G products, and boost the rapid development of 5G technologies through scaled applications.
That is all I have to say. Thank you.
_ueditor_page_break_tag_Bauhinia Magazine:
The industrial sector is an important sector for the goals of peaking carbon emissions and achieving carbon neutrality. Regarding this matter, what is the consideration of the ministry? And what specific measures will you take this year to make steady progress in green and low-carbon industrial transformation? Thank you.
Xiao Yaqing:
Thank you for your questions. To peak carbon emissions and achieve carbon neutrality is a major strategic decision made by the CPC Central Committee in consideration of both domestic and international dynamics. It will be a broad and profound transformation, and it is an inherent requirement and an inevitable choice for high-quality development. Energy consumption in the industrial sector accounts for about 65% of China's total energy consumption, and it is one of the major areas of energy conservation and carbon reduction efforts. We have a tight schedule to accomplish this arduous task. It is a major challenge as well as a major opportunity. Green and low-carbon industrial development will certainly bring new growth space, new innovation impetus, and new development opportunities to the industrial economy. There are many things we can do and many areas we can explore in green and low-carbon development. We will conscientiously implement the decisions and plans of the CPC Central Committee and the State Council, bear in mind the country's most fundamental interests, and adhere to a holistic view in order to handle well the relationships between development and emission reduction, the whole and the parts, long-term goals and short-term goals, and government and the market. We will make overall considerations to keep the proportion of manufacturing basically stable, ensure the security of industry chains and supply chains, and meet reasonable consumption needs. We will rationally break down goals and tasks to promote green and low-carbon industrial transformation in a steady and orderly manner.
Our work will cover the following aspects.
First, we will strengthen the top-level design of policies. We will implement the Action Plan for Carbon Dioxide Peaking Before 2030 issued by the State Council, actively take actions for peaking carbon emissions of the industrial sector, and release action plans for the industrial sector and key industries. With a focus on industries like iron and steel, building materials, petroleum chemistry, chemical industry, and nonferrous metal, we will formulate a series of categorized and targeted policies based on industry characteristics and development conditions to push for peaking carbon emissions in the industrial sector in a steady, sound, scientific and orderly manner.
Second, we will make in-depth adjustments to the industrial mix in an orderly way. We will pursue new development before ruling out the obsolete: we will deepen supply-side structural reform in key industries and build an industrial structure conducive to reducing carbon emissions; we will strictly implement production capacity swap policies in industries like iron and steel, cement, plate glass, and electrolytic aluminum; and resolutely restrict the haphazard development of projects that are energy intensive and have high emissions and low levels of production. In particular, we will strictly control the scale of energy use in key industries such as iron and steel.
Third, we will implement green and low-carbon transformation in the manufacturing sector. We will release a directory to guide key industries in green and low-carbon upgrading and transformation, and promote the innovation of low-carbon techniques and the digital transformation in key industries and sectors. We will push for sound implementation of the plan for the comprehensive utilization of industrial resources, and strengthen energy conservation monitoring and supervision and energy conservation diagnosis. We will speed up the cultivation of green data centers, give play to their demonstrative and leading role, and build public service platforms for key industries concerning peaking carbon emissions.
Fourth, we will build a supply system for green and low-carbon products. We will improve the green manufacturing system, improve the green design of products, and cultivate a number of demonstrative companies in green design. We will increase the supply of photovoltaic equipment, fans, and energy-saving motors, carry out special actions to pursue the innovative development of the smart photovoltaic industry, and improve the industry chain for wind power equipment. We will revise and improve the system for parallel administration of auto companies' fuel consumption and new energy vehicle credits. As Mr. Xin briefed just now, we will step up efforts to popularize new energy vehicles, vigorously develop green smart ships, promote the certification of green building materials products, and make moves to get rural areas access to green building materials. By increasing the supply of green and low-carbon products, we will help sectors like energy, transportation, and urban and rural development peak carbon emissions.
It is a very important task, and we need to push forward it step by step for notable outcomes. Thank you.
Shou Xiaoli:
Thank you, Mr. Xiao, for your introduction. Thank you to all the speakers and media friends. That concludes today's press conference. See you next time.
Translated and edited by Zhang Rui, Liu Qiang, Lin Liyao, Zhou Jing, Wang Mengru, Wang Wei, Yan Xiaoqing, Li Huiru, Zhang Tingting, Chen Xia, Zhu Bochen, Liu Sitong, Zhang Jiaqi, Ma Yujia, David Ball and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Tang Renjian, director of the Office of the Central Rural Work Leading Group and minister of Agriculture and Rural Affairs
Liu Huanxin, deputy director of the Office of the Central Rural Work Leading Group and administrator of the National Rural Revitalization Administration
Wu Hongyao, deputy director of the Office of the Central Rural Work Leading Group and member of the CPC Leading Group of the Ministry of Agriculture and Rural Affairs
Chairperson:
Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Feb. 23, 2022
Chen Wenjun:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). On Feb. 22, the Central Committee of the Communist Party of China (CPC) and the State Council issued a document outlining key tasks to comprehensively push forward rural revitalization this year, also referred to as the "No. 1 central document," that everyone is interested in. To help people accurately understand the principles and content of the document, today we have invited Mr. Tang Renjian, director of the Office of the Central Rural Work Leading Group and minister of Agriculture and Rural Affairs to introduce and elaborate on the document and answer your questions. We also have with us Mr. Liu Huanxin, deputy director of the Office of the Central Rural Work Leading Group and administrator of the National Rural Revitalization Administration, and Wu Hongyao, deputy director of the Office of the Central Rural Work Leading Group and member of the CPC Leading Group of the Ministry of Agriculture and Rural Affairs.
Next, let's give the floor to Mr. Tang Renjian to give a brief introduction.
_ueditor_page_break_tag_Tang Renjian:
Ladies and gentlemen, good morning. Spring has returned to the land and farmers are busying themselves in the fields. On Feb. 22, Xinhua News Agency was authorized to release the full text of a document issued by the CPC Central Committee and the State Council that outlines key tasks to comprehensively push forward rural revitalization this year, also referred to as the No. 1 central document. This is the 19th document in a row issued by the central government to guide the work related to agriculture, rural areas and rural people since the turn of the millennium, which shows the determination of the CPC Central Committee and the State Council to prioritize agriculture and deliver benefits to rural people. Next, I will briefly introduce the document to you.
First, the background of drafting the document.
Since last year, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, in dealing with affairs related to agriculture, rural areas and rural people, we have overcome such difficulties as the COVID-19 pandemic and natural disasters and got off to a good start in implementing the 14th Five-Year Plan (2021-2025). First, we have made steady progress in agricultural production. Another bumper harvest was achieved, with the output of grain reaching 1.37 trillion jin (685 billion kg), an increase of 26.7 billion jin (13.35 billion kg). The capacity of raising hogs was restored half a year ahead of schedule, and the market supply and prices of other major agricultural products were generally stable. Second, the income of farmers maintained growth. The per capita disposable income of rural residents reached 18,931 yuan, an increase of 9.7% in real terms, and a growth rate 2.6 percentage points higher than that of their urban counterparts. Third, the gains in poverty alleviation have been consolidated and expanded. The monitoring and assistance mechanism has been continuously improved and strengthened, and the working mechanism, policy measures and institutional teams have been put in place in an orderly manner. We have maintained the bottom line of ensuring no large-scale return to poverty. Fourth, we have taken solid steps to comprehensively promote rural revitalization. The development of rural industries has accelerated, a five-year action plan on improving the rural living environment has been launched, the level of rural governance has been continuously improved, the reform of rural areas has been advanced, and rural society has been stable and peaceful. The remarkable achievements in the reform and development of agriculture and rural areas have played an important role in turning a new page, responding to changes and stabilizing the overall social development.
2022 is an important year as China enters a new era of building a modern socialist country in an all-round way and strides toward its second centenary goal. At the end of last year, General Secretary Xi Jinping delivered an important speech at a meeting of the Standing Committee of the Political Bureau of the CPC Central Committee on issues related to agriculture, rural areas and farmers. He underscored factoring in the national strategic needs when responding to multiple risks and challenges, and ensuring the steady development of agriculture and rural areas. Tough measures and strong implementation are needed in dealing with affairs related to agriculture, rural areas and farmers. He also underlined and made arrangements on key issues including food security, preventing a large-scale return to poverty, and farmland protection. These provided the fundamental principles and an action plan for drafting the No. 1 central document in 2022, and doing a good job in affairs related to agriculture, rural areas and farmers at present and going forward. In response to major changes and the pandemic, both unseen in a century, and to promote the stable and healthy development of the economy and society, we must continue to comprehensively promote rural revitalization and give better play to the role of "agriculture, rural areas and farmers" as the anchor, paving the way for the 20th National Party Congress with actions.
Second, the main content of the document.
In the new era and new stage, the priority of the work related to "agriculture, rural areas and farmers" is to promote rural revitalization. Implementing the spirit of General Secretary Xi Jinping's important speeches, this year's No. 1 central document does not introduce new themes or new expressions. Instead, we have adhered to the overall goal of rural revitalization, prioritized stability and pursued progress while ensuring stability. The document outlines key tasks to advance rural revitalization in 2022. It comprises 35 articles in eight parts, and the main content can be summarized as "two bottom lines, three key areas, one reinforcement."
The "two bottom lines" refer to firmly upholding the two bottom lines of guaranteeing China's grain security and ensuring no large-scale return to poverty. It emphasizes that we will do our best to enhance grain production and the supply of vital agricultural products, strengthen protections to guard the red line of 1.8 billion mu (120 million hectares) of arable land, and ensure that the sown areas for grains remain stable and the full-year grain output stays above 1.3 trillion jin (650 billion kg). The document urges efforts to improve mechanisms for monitoring and assisting people at risk of falling back into poverty, and to promote areas that have been lifted out of poverty to consolidate and expand the achievements of poverty alleviation through development and ensure that there is no large-scale return to poverty.
"Three key areas" means to promote rural development, construction, and governance in a solid and orderly way. Regarding rural development, we will focus on the integrated development of the primary, secondary, and tertiary industries in rural areas and help farmers seek employment and raise their incomes locally or close to their homes. We will improve implementation mechanisms regarding rural construction and prioritize projects for farmers' well-being that provide universal access and meet farmers' fundamental and essential needs. As to rural governance, we will pay special attention to the construction of grassroots organizations creatively building effective platforms for cultural and ethical construction to maintain the safety and stability of rural society.
"One reinforcement" means sticking to and reinforcing the Party's overall leadership over agriculture, rural areas, and farmers. In addition, the document emphasizes the responsibility in promoting all-round rural revitalization and scaling up policy guarantee and institutional innovation.
In summary, this year's document emphasizes the tasks, measures, and orientation for rural revitalization. It is both detailed and practical and clarifies the priorities and tasks for promoting all-round rural revitalization in 2022.
Now, my colleagues and I are ready to answer your questions.
_ueditor_page_break_tag_Chen Wenjun:
Thank you, Mr. Tang. The floor is open. Please identify your media outlet before raising your questions.
CCTV:
Last year, the Central Economic Work Conference emphasized that primary products supply is a strategic issue. As grain is the most fundamental and key primary product, how should we ensure China's grain safety? Thank you.
Tang Renjian:
Thank you for your question. General Secretary Xi Jinping has emphasized repeatedly that Chinese people should hold their rice bowls firmly in their own hands, with grains mainly produced by themselves. China's grain output has remained at 650 billion kilograms for seven consecutive years. We have ample supply and storage. China's grain prices have remained stable, and the market is steady, despite the sharp rise in grain prices globally and the impacts of the COVID-19 pandemic. This proves that China has maintained food security and that we are competent and confident to hold our rice bowls firmly in our own hands.
However, this does not mean we can rest easy on grain security. From having enough food on one's table to eating well, from rice, flour, and oil to meat, eggs, and milk, Chinese people's consumption structure is upgraded all the time. However, the demand for food is still on the rise, and structural problems emerge constantly. Therefore, grain demand will remain in a tight balance for a long time, and the restraints in resources and the environment are increasing. Against this backdrop, we need to safeguard food security and conduct our work concretely and solidly. Therefore, we will work on the following three aspects.
First, we will ensure that all the duties and responsibilities are fulfilled. When it comes to food security, the principles of comparative advantage and efficiency first do not always apply in China. The central government has made clear that grain-producing areas, grain-consuming areas, and areas that have a balance in grain production and consumption now have the responsibility of securing the sown areas for grains and grain output. Grain-producing areas should improve their comprehensive capacities in producing grain, grain-consuming areas should maintain and increase their self-sufficiency rates of grain, and areas that have a balance in grain production and consumption should ensure that they can realize grain sufficiency on their own. The State Council has approved this year's grain production goals, and we have done the breakdown and informed provincial (autonomous regions and municipal) governments of their respective goals. Next, we will make sure that both Party committees and governments shoulder the responsibility of ensuring food security. We will work with the related departments to formulate plans as soon as possible to evaluate the food security responsibilities of provincial Party committees and governments to make sure that they shoulder their responsibilities in this regard.
Second, we will safeguard farmers' profits in grain production. After all, grain is produced by farmers. When farmers can make money by producing grain, the whole country's food is in safe hands. This year, we will work to improve the mechanism of guaranteeing farmers' profits in grain production and strive to make sure that farmers can break even with supportive policies and raise their income with agriculture-related businesses. On the policy front, we will reasonably raise the minimum purchase price for rice and wheat to continue implementing rice subsidy and subsidy policies for the producers of corn and soybean. We will also make sure that all rice, wheat, and corn producers in major grain-producing counties of major grain-producing provinces are covered by full-cost and income insurance. On the business front, we will focus on weak areas and vigorously develop agriculture services to raise farmers' incomes in producing grain. In all, we should make sure that farmers can make money and make as much money as possible through grain production.
Third, we will strengthen the supporting capacity of fundamental elements. It is essential to implement the strategy of sustainable farmland use and innovative application of agricultural technology for national food security. We will firmly focus on the two key elements of seeds and farmland to consolidate the material foundation of grain production. In terms of seeds, last year, we launched a large-scale survey of agricultural germplasm resources, carried out the construction of a germplasm resource bank, and constantly strengthened the intellectual property protection of the seed industry. This year, we will make good use of policies to implement the action plan on energizing the seed industry. In the aspect of farmland, we have implemented a range of strong measures to protect the farmland. Both Party and government officials should take responsibility to ensure that the total area of China's arable land stays above 120 million hectares. We will ensure that the arable land is mainly used for the production of grain, agricultural products such as cotton, oil, sugar, and vegetables, as well as forage crops. Permanent basic farmland will be mainly used for grain production and all high-quality farmland will be used for grain production in principle. We mentioned three concepts of different levels here: arable land, permanent basic farmland, and high-quality farmland. In addition, in terms of agricultural machinery equipment, we should shore up weak links by regions and varieties and strengthen the technology and equipment support for modern agriculture. Thank you.
_ueditor_page_break_tag_CRNTT:
This year is critical for pushing forward rural revitalization in an all-round way. According to the No. 1 central document, what new arrangements have been made in terms of working mechanisms and approaches to ensure that all tasks will be carried out in an active and steady manner? Thank you.
Tang Renjian:
We have completed all poverty eradication targets and tasks. We are now turning to the new goal of advancing rural revitalization in an all-round way. General Secretary Xi Jinping said that it's a historic shift of focus in the work related to agriculture, rural areas, and farmers. We have an effective experience in our poverty alleviation efforts, that is, a sound and improved working mechanism. Therefore, we will also learn from this good experience when pushing forward rural revitalization in an all-round way.
In the new era, as I mentioned at the beginning of this press conference, the focus of the work related to agriculture, rural areas, and farmers is to advance rural revitalization in an all-round way, which is also the focus of this year's No. 1 central document. In the new era, rural revitalization and the work related to agriculture, rural areas, and farmers contain similar subjects and extend over a similar range. Therefore, they should not be separated in our practical work. At present, it is crucial to be steadfast in our work, and to use strong actions.
First, we will ensure that all duties and responsibilities are fulfilled. It is a systematic project to advance rural revitalization in an all-round way, featuring integrated arrangements. It is not a specific task for a certain department or a certain sector. It needs the combined efforts of the Party and all of society, and of all departments and localities. In the next step, we will speed up formulating measures for the implementation of the rural revitalization accountability system, clarify responsibilities of the departments of the CPC Central Committee and the central government in advancing rural revitalization, and implement the specific requirements for Party secretaries at the five administrative levels of province, city, county, township, and village, to take charge of rural revitalization, so as to pool all efforts to create great synergy. This year, we will also carry out the performance evaluation on the work to promote rural revitalization strategy for provincial Party and government leadership groups and officials. Meanwhile, we will also improve the evaluation system for officials at the levels of city and county and ensure that all the duties and responsibilities are fulfilled.
Second, we will improve our mechanisms. We will use the effective experience and practice formed in poverty alleviation for promoting rural revitalization in accordance with new needs. To be specific, our work will go hand in hand with the implementation of regulations for the country's rural work issued by the CPC Central Committee and the law on the promotion of rural revitalization promulgated last year. We will make efforts to improve an all-round promotion mechanism for rural revitalization in terms of responsibility fulfilment, organization and promotion, social mobilization, factor guarantee, assessment and evaluation, work reports, and supervision and inspection, widely mobilizing the people and bringing together the resources needed.
Third, we will improve our work style. Different to poverty alleviation, rural revitalization is a prolonged campaign rather than a tough battle, and is also a career that covers all fields and all people on all fronts. We should give up the idea of accomplishing our tasks in one battle, not set unrealistic targets, avoid eagerness for quick results by going beyond the development stage, or even aiming high and going all out at random. All these won't work. We should resolutely oppose the practice of favoring form over substance in this regard. We should work in accordance with the actual situation of different places, respect the underlying trends of rural areas, and steadily promote our work with a more mature and more well-established system. We will carry out large-scale training to study General Secretary Xi Jinping's major expositions on the work related to agriculture, rural areas, and farmers. At present, there are elections for officials at different levels, including people working at the grassroots level. Some new officials have taken office. After taking up their posts, they should learn deeply and thoroughly understand major expositions by General Secretary Xi Jinping on the work related to agriculture, rural areas, and farmers, and then make practical efforts. Therefore, we will study further by carrying out large-scale training. Only in this way can we keep to the right direction of policies, effectively improve our work style, enhance the policy level of the work related to agriculture, rural areas, and farmers and improve our working ability.
Fourth, we will strengthen the building of organizations. This year's No. 1 central document emphasizes that rural work leading groups under Party committees at all levels should undertake both the duty to consolidate and extend gains in poverty alleviation, and promote all-round rural revitalization. Now at the central level, the Office of the Central Rural Work Leading Group, the Ministry of Agriculture and Rural Affairs and the National Rural Revitalization Administration are jointly promoting the all-round rural revitalization, under the leadership of the Central Rural Work Leading Group. What roles are each of these respective authorities playing? First, the Office of the Central Rural Work Leading Group is taking the lead in carrying out the strategy. Second, the Ministry of Agriculture and Rural Affairs is responsible for coordinating different departments, as enshrined in the Law on the Promotion of Rural Revitalization. Third, the National Rural Revitalization Administration is in charge of putting measures in place. While their roles may be different, there is no way to separate them from each other. We should join together to promote rural revitalization in a well-organized and systematic manner, from different perspectives and at different levels.
_ueditor_page_break_tag_Thecover.cn:
Last year, China experienced repeated challenges from natural disasters and the pandemic. What achievements have been made in consolidating and extending the progress in poverty alleviation? And what measures will be taken to prevent a large number of people from falling back into poverty? Thank you.
Liu Huanxin:
Thank you for your attention to the poverty alleviation work. General Secretary Xi Jinping attaches great importance to consolidating the achievements of poverty alleviation, stressing that this is the premise of rural revitalization, and urged continuous efforts to ensure those lifted out of poverty can live better lives. Over the past year, we have implemented the decisions and plans of the CPC Central Committee and the State Council. Solid efforts have been made in consolidating and extending the gains in poverty alleviation and coordinating them with the promotion of rural revitalization. Our work has been in the following aspects: First, we prevented risks. The dynamic monitoring mechanism to prevent people from falling back into poverty has been established in an all-round manner. The mechanism has eliminated the risks of nearly 70% of the people monitored, and the rest of them have been provided with support measures and can get rid of the risks in the future. We have provided timely support to people that have been lifted out of poverty and then affected by natural disasters, and thus prevented them from falling back into poverty because of disasters. Second, we coordinated work. Support policies that were carried out during the course to eradicate poverty have been adjusted and optimized by category to formulate 33 policies that dovetail with rural revitalization. A total of 160 counties were listed as key counties for national rural revitalization, and favorable policies have been leveraged in 14 sectors. We ramped up eastern-western collaboration, designated assistance, and follow-up support for resettled population. We completed organization of agencies for promoting rural revitalization. Evaluation work has been carried out to ensure the work to consolidate and extend gains in poverty alleviation dovetails with that of promoting rural revitalization. Such work has been promoted in an orderly manner. Third, we boosted development. The central government arranged 156.1 billion yuan in subsidies to promote rural revitalization, which is 10 billion yuan more than the previous year, with over half of the fund invested in developing industries. Some 31.45 million people lifted out of poverty found jobs, up by 1.26 million over last year, representing an increase of 4.2%. The per capita net income of people lifted out of poverty reached 12,550 yuan, an increase of 1,810 yuan or 16.9% over the previous year. In general, we have consolidated and extended poverty alleviation progress in 2021 and ensured that people do not sink back into poverty in large numbers.
Next, we will fully implement the guiding principles laid out by General Secretary Xi Jinping and the decisions and plans of the CPC Central Committee and the State Council. Solid efforts will be made to ensure departments take their responsibilities, implement policies and carry out work to consolidate and extend poverty alleviation progress. We will work to ensure that people lifted out of poverty live a better life, and ensure that people do not sink back into poverty in large numbers. Our major work will be in the following aspects:
First, efforts will be made to improve the mechanism for monitoring and assisting people at risk of falling back into poverty. Our work will be carried out using a three-pronged approach. First, we will make it more targeted. We will carefully identify the groups that need to be monitored. All rural people at risk of returning to or falling into poverty and those affected by sudden and serious difficulties should be included in the monitoring mechanism. Second, we will provide support earlier. Those experiencing serious financial difficulties arising from housing, education, employment, illness, disaster and epidemic will be provided with support and assistance in a timely manner, so the risk of them returning to or falling into poverty will be nipped in the bud. Third, we will make procedures more simplified. We will remove the barriers that hamper the flow of data among different monitoring platforms, shorten the time and improve the efficiency of the mechanism for monitoring and assisting people at risk of falling back into poverty.
Second, efforts will be made to increase the incomes of people that have been lifted out of poverty. We will focus on providing employment support. Work on consolidating and extending gains in poverty alleviation will be driven more by development. We will prioritize the transformation and upgrading of industries. We will gradually increase the proportion of the central government subsidies for rural revitalization for industrial development. We will step up efforts to address weaknesses in technology, facilities and marketing, and increase the operating income of people that have been lifted out of poverty. We will take every step possible to stabilize employment and ensure more people lifted out of poverty can find jobs through such methods as organizing labor export, boosting employment in paired-up factories, and optimizing public welfare posts for poverty alleviation.
Third, efforts will be made to provide stronger assistance in key areas. In terms of key counties for national rural revitalization, we will compile implementation plans. We will also pool resources to build a series of projects to address weaknesses and boost development in the counties so they will gain a stronger capacity for self-development and have a more solid and sustainable foundation for poverty alleviation. In terms of resettlement areas, we will continue increasing follow-up support with regard to expanding employment, infrastructure construction and public services, so as to ensure smooth resettlement, and make sure that those involved have the means to better themselves.
Fourth, we will make efforts to promote the implementation of assistance policies in regions lifted out of poverty. We can't slam on the breaks as soon as we win the battle against extreme poverty. We need to ensure that major assistance policies will remain unchanged and keep up the support intensity to give them a leg up to get them going. Therefore, we will evaluate the effectiveness of the policies this year to promote the implementation and ensure that they can achieve results, which will ultimately provide support and guarantee for consolidating and expanding the achievements in poverty alleviation.
_ueditor_page_break_tag_China Daily:
This year's No. 1 document pointed out that strong measures shall be implemented to protect the arable land. What strong measures will be adopted regarding arable land construction and protection? Thank you.
Wu Hongyao:
This is a very important question. The arable land serves as the lifeline of grain production. General Secretary Xi Jinping has attached great importance to protecting arable land. He has made important instructions overt it on various occasions, noting that the requirements for the protection of arable land must be further clarified to ensure that China's 1.8 billion mu (120 million hectares) of farmland is a reliable figure and that all of the farmland is fertile. This year's No. 1 central document has paid more attention to the cultivation and protection of arable land, and it has rolled out a series of strong measures, which can be summarized as "ensuring quantity, improving quality, regulating the utilization and tapping into the potential."
To ensure quantity, we will firmly stick to the red line of 1.8 billion mu of arable land. Priorities lie in the following three aspects. First, we will draw redlines for designating arable land and permanent basic cropland, protecting the ecosystems and delineating boundaries for urban development. Second, we will specify the task quotas and targets that authorities at all levels need to achieve to protect arable land and permanent basic farmland, with every single piece of the land being marked with details. Third, some responsibility statements will be signed between central and local authorities, setting up specific targets for protecting arable land, which will be taken as mandatory indexes. Finally, we will ensure a stringent mechanism with a "one-vote veto" system and a lifelong accountability system.
In terms of improving quality, we will ramp up efforts to improve the quality of arable land. First, we will continue to take high-standard farmland construction as our priorities, aiming to complete the construction of 100 million mu of high-standard farmland and 400 million mu of high-efficiency water-saving irrigation areas. Moreover, we will also step up efforts to upgrade medium-and low-yield farmland to improve the fertility of arable land. Second, we will make great efforts to protect chernozem soils and further promote national chernozem soils protection projects to adopt conservation tilling techniques on 80 million mu of chernozem soils. Third, we will strengthen the entire process of regulation over balancing the occupation and replenishment of arable land, and ensure that the replenished land can be used in a long-term and stable manner, which will ensure that the capacity of the replenished land can be equivalent to those have been occupied.
In terms of regulating the utilization, we will strengthen the regulation over the use of arable land. First, those practices to turn the arable land into construction land shall be strictly limited. We will enhance law enforcement and regulation and punish those illegal practices of using the arable land for non-farming purposes. Second, we will hold tight control over converting arable land into other agricultural land. Third, we will ensure that the use of arable land should strictly follow specific priorities that they are supposed to be used. As Mr. Tang said, the arable land should be used primarily for the production of agricultural products such as grain, cotton, oil, sugar, and vegetables, as well as forage grass and fodder. The permanent basic farmland is mainly used for grain production, and all the high-standard farmland is theoretically used for grain production.
We will step up efforts to tap into the land potential to increase the quantity of arable land. We will support the practices of converting those qualified saline-alkali soil and other potential land resources into arable land in a proper and orderly manner. While protecting the ecological environment, those idle land and abandoned land suitable for development can be used to develop facility agriculture to break the resource constraints in terms of arable land, light, and heat. Thank you.
_ueditor_page_break_tag_China County Times:
One of the priorities of rural revitalization is to help boost the incomes of populations through industrial development. What are the key areas and directions in this year's No. 1 central document on promoting rural industrial development? Thank you.
Tang Renjian:
This question is crucial, as industrial revitalization stays at the top of the "five priorities" of rural revitalization. Therefore, I'd like to invite Mr. Wu to answer this question.
Wu Hongyao:
General Secretary Xi Jinping stressed that thriving business is the basis for resolving all issues facing rural areas. Therefore, industrial revitalization stays at the top of the "five priorities" of rural revitalization. This year's No. 1 central document sets out precise requirements for promoting rural development by industrial development, aiming to step up efforts in three aspects.
First, efforts should be made to promote the integrated development of the primary, secondary, and tertiary industries in rural areas. Rural industries have their roots in agriculture. While making farming and breeding industries stronger, we will fully engage the multiple functions of agriculture, realize the multiple values of rural areas, and develop the three major industries of farm-produce processing, rural leisure tourism, and rural e-commerce. Vertically, we will build a comprehensive agricultural industry chain, facilitate the expansion of industries to the back end and downstream, and shift the focus from selling initial agricultural products to promoting brands, with the aim of increasing production values and industrial efficiency. Horizontally, we will advance the in-depth integration of agriculture with leisure, tourism, health care, ecology, culture, elderly care, and other industries to enrich the varieties of rural industries and enhance the value of the rural economy.
Second, efforts should be made to develop county-level industries that can help boost farmers' incomes. We will develop county-level industries with obvious comparative advantages which can drive agricultural and rural prosperity and create employment opportunities to ensure that every county has at least one characteristic industry. To achieve the coordinated development of county-level industries, we will scientifically arrange production, processing, sales, consumption, and other links, locate them in the most suitable places, and form a spatial industrial layout with a reasonable division of labor among counties, townships, and villages. Meanwhile, we will leverage the role of industrial parks as the platform, guide the transfer of farm-produce processing industry to counties and main production areas, and build characteristic industrial clusters featuring close coordination between urban and rural areas.
Third, efforts should be made to help farmers get jobs and increase incomes locally or in nearby regions, which is the purpose of industrial development in rural areas. We must not make business owners better off while leaving farmers in poverty. Nor should we exclude farmers from the industrial chain. We encourage industrial and commercial capital to invest in rural areas, give play to the advantages in capital, technology, management, and brand, and improve the interest linkage mechanism to help farmers gain prosperity through complementary strengths of industrial chains and an effective division of labor. We will also support commercial organizations to provide agricultural services such as contract farming, processing, logistics, and marketing so that farmers can share more benefits from the growth of industries. Thank you.
_ueditor_page_break_tag_Economic Daily:
Last year, large areas of winter wheat were not planted on time due to the autumn floods. What impact will it have on this year's summer harvest? What measures will be taken to ensure stable and high yields? Thank you.
Tang Renjian:
This journalist has a keen insight. The questions involve the biggest challenge in our present work related to agriculture, rural areas, and farmers. It is also our chief concern now.
Due to abnormal autumn floods, more than 7.3 million hectares of autumn and winter wheat across Hebei, Shanxi, Shandong, Henan, and Shaanxi provinces were not planted on time. How long was the sowing date delayed? For around half a month. The delay affected one-third of the total acreage, which is a large scale never seen before. Thanks to careful cultivation, the acreage of winter wheat is as large as that of last year. However, the seedling growth becomes complicated and we still face grave challenges in reaping a bumper summer harvest. Summer harvest is the first of China's annual grain production, which accounts for more than a fifth of the annual grain output and 40% of its annual staple food production. Summer grain production is of great significance for ensuring supply, stabilizing expectations, and increasing confidence. Confronted by the complicated situation, we will make every effort with a strong determination to ensure a bumper summer harvest and get a good start for high grain yields for the whole year.
First, we will strengthen wheat field management. This is a fundamental task. Now it's around 100 days before the summer wheat harvest. Our first priority is to maximize yield recovery by adopting technologies and measures at the three key stages of wheat growth, namely green-up, stem elongation, and grain-fill. At the green-up stage, the critical measure is applying fertilizers to boost the growth of weak seedlings and increase the number of panicles; at the stem elongation stage, the critical measure is resisting drought and freezing to boost the growth and increase the number of grains; at the grain-fill stage, the critical measure is applying a variety of pesticides, germicides, and fertilizers to increase the weight of grains. We have provided relevant local governments with detailed information about the distribution of late-planted wheat based on the types of seedling growth, which will serve as a basis for targeted guidance. Recently, authorities of agriculture and rural affairs have mobilized large groups of personnel to concentrate on the frontline of wheat production and offer targeted services for designated regions. They are working hard to maximize the yields of wheat sown at the right time and prevent and minimize the reduction in the yields of late-planted wheat.
Second, we need to do a good job in disaster prevention and mitigation. For one, we need to prevent natural disasters. Due to the influence of the La Nina phenomenon, extreme weather is more likely to occur this year. We will focus on preventing disasters such as spring cold, late spring cold, summer drought, and floods that have a great impact on food production. We will further detail and materialize the plan for disaster prevention and mitigation to achieve a bumper harvest, and make material reserves and technical preparations as soon as possible. We will make full and good use of the disaster relief funds for agricultural production to help farmers take the initiative to avoid disasters, scientifically prevent disasters, and minimize disaster losses. For the other, we will make disease and insect pest control. Because there was a lot of rain last year and the soil moisture was good, there are advantages, but there are also disadvantages, including that the risk of pests and diseases is relatively high. Therefore, this year, crop diseases and insect pests are expected to appear more and more frequently. Wheat will mainly suffer from stripe rust, scab, etc. This year, there will also be stem rot, all because of the large amount of water. We will focus on prevention and control of these major pests and diseases, implement "integrated monitoring, general coordination, one-map command," (command the battle against pests and disease based on a smart map that integrates and shows all the visual information) and vigorously promote unified prevention and treatment, joint prevention and control, and emergency prevention and control so as to achieve the goal of rescuing food from insects.
Third, we need to do a good job in preparing for spring farming. Not long ago, the national work conference on spring agricultural production was held to fully deploy the spring plowing and preparation work. The central government is also currently studying the distribution of agricultural subsidies to support spring farming. We will take the implementation of grain sown acreage as the top priority of spring plowing and preparation work, consolidate the production of early rice and stabilize the acreage of autumn grain, ensure that the acreage of grain can be allocated to households and fields, and consolidate the acreage coverage foundation for a bumper grain harvest throughout the year. At the same time, we will work with relevant departments to ensure the supply of agricultural materials, and to schedule the demand for seeds, fertilizers, and medicines during spring plowing as soon as possible. We will speed up the efforts to introduce agricultural materials into stores and villages, stabilize the price of agricultural materials as much as possible, and strengthen quality supervision in order to meet the needs of spring plowing work. Thank you.
_ueditor_page_break_tag_China Rural Magazine:
The fifth plenary session of the 19th CPC Central Committee proposed to implement rural development actions; put rural development in an important position in socialist modernization; optimize work, living, and ecological space; continue to improve village conditions and living environment; and build beautiful and livable countryside. Please let us know what are the new layouts and new requirements for rural development in the No. 1 central document this year? Thank you.
Liu Huanxin:
The implementation of rural development actions is a major deployment made by the fifth plenary session of the 19th CPC Central Committee, and an important carrier and key point for comprehensively promoting rural revitalization. General Secretary Xi Jinping has emphasized that rural development must be done quickly, steadily, and persistently. The rural development action plan will be released soon. This year's No. 1 central document, on the basis of summarizing the practices of various regions, put forward clearer requirements for the implementation mechanism of rural development, focusing on the "three adherences."
The first is to adhere to the focus on the improvement of people's livelihoods that is inclusive, basic, and fundamental. A basic goal of rural development is to improve rural production and living conditions, and strive to allow farmers to gradually live a modern and civilized life in their lands. It says we don't need to set the bar too high on goals and standards, while levels, standards, and grades can be adapted to actual conditions of different places, high or low. The focus is to ensure basic functions and to solve outstanding problems. It asks to strengthen infrastructure construction in key areas such as rural roads, water supply, electricity, network, and housing security, continue to improve the rural living environment. In particular, those facilities that are beneficial to both production and life, such as rural roads, storage cold chain, and logistics facilities, should be prioritized and their construction accelerated.
The second is to adhere to the understanding that we develop rural areas for farmers. To promote rural development, we must fully respect the wishes of farmers. If farmers expect something, we have to do it quickly. If farmers are willing to do something, we should lead them to do it. If they don't want to do something, we should put it off and slow down. We should fully understand the long-term and complex nature of rural development, grasp the timeliness, scale, and effects of the work, adhere to the principle of quality over quantity, and actual effects over progress – we want good quality rather than quick pace. When doing construction based on the village, we must pay attention to the protection of traditional villages; retain the original appearance, style, shape, and texture of the village; retain the green mountains and lucid waters; and retain the nostalgia. We must not blindly demolish old villages and build new ones, or not go beyond the development stage to engage in large-scale financing, large-scale development, and large-scale construction. We should strictly regulate the village-dismiss and village-merger.
The third is to adhere to bottom-up, villager autonomy, and farmers' participation. Farmers are the main part of production and life in rural areas. In rural development, targets and tasks cannot be set from the top down. The key is to mobilize and organize farmers and give full play to the main role of farmers. What farmers should do should be left to be done by farmers themselves as much as possible, especially the things that farmers do inside their households as well as in front of and behind their houses, such as rural toilet renovation, courtyard sanitation, and greening and beautification – these are mainly farmers' own things, and we can delegate and mobilize the farmer masses to do them. The government should focus on doing things that farmers can't do or can't do well, such as creating water supply security and sewage treatment for rural toilet improvement, or the collection, transfer, and centralized treatment of domestic garbage and the improvement of the public environment of the village – the government must do these things well. Thank you.
Tang Renjian:
Mr. Liu Huanxin just gave a wonderful answer to the above question. Now I would like to conclude by making two points that I think are most important and worth our attention after more than one year of practice and implementation of the rural revitalization strategy across the board.
First, in terms of working philosophy, we should uphold the principle that rural revitalization and rural development are for rural people. Second, in terms of methodology, in accordance with the instructions of General Secretary Xi Jinping, we should adopt an approach in which quantity gives way to quality, the speed of progress gives way to solid outcomes, and pursuit of quick results gives way to good results. These are the two most important points.
_ueditor_page_break_tag_Farmers' Daily, farmer.com.cn:
Rural governance has always been a focus of public concerns. What are the priorities for rural governance in the No. 1 central document this year? And what measures will you take? Thank you.
Tang Renjian:
The National Rural Revitalization Administration is in charge of concrete work regarding rural development and rural governance. Let's give the floor to Mr. Liu Huanxin.
Liu Huanxin:
General Secretary Xi Jinping has attached great importance to rural governance, stressing that we should innovate the system to achieve good governance in rural areas. Rural governance is the cornerstone of China's state governance and an important part of rural revitalization. This year, the No. 1 central document outlines three priorities for rural governance.
First, we should strengthen the development of rural community-level organizations. The success of rural areas hinges on the Party, which is our biggest institutional strength. We should focus on team-building, strengthening the function of county-level Party committees in promoting Party building at township and village levels. After the elections at township and village levels, we will carry out extensive training on the theme of rural revitalization, helping resident first Party secretaries and working teams play their role to the full. We will also strengthen the leading groups, and implement a gridded management model, digitalization empowerment and refined services. We should focus on mechanism establishment, implementing in real earnest a "4+2" system. Here, "4" means four steps: proposals should be put forward by the Party branch, jointly discussed by the village committee and the Party branch, and deliberated by Party members, and resolutions should be adopted by villagers' representatives; "2" means transparency on two levels: resolutions and implementation results should be made known to the public. By doing this, we will make sure that all the important affairs and problems at village level will be studied and discussed by village Party organizations, and their leadership over various other village-level organizations will be enhanced and improved. Meanwhile, a rural governance model which combines self-governance, rule of law, and rule of virtue will be improved under the leadership of Party organizations. We should focus on supervision, carrying out extensive disciplinary inspections for city and county-level Party committees. We will strengthen communication and coordination between grassroots disciplinary inspection commissions and committees for supervision of village affairs and ensure effective dovetailing to enhance the supervision over village officials.
Second, we should promote cultural and ethical progress. The key is to explore new ways to enable the voice and call of the Party to reach thousands of rural households in a form that is more acceptable and easily understandable to rural people. Nowadays, rural areas are still underdeveloped in culture. We will enrich the cultural life of rural people, increase the supply of cultural and intellectual products, and support farmers to actively organize and participate in cultural activities and sports. Low-cost, participant-friendly, healthy, and positive recreational activities will be introduced for rural people to enjoy — although not necessarily high-end, ostentatious ones — as long as they can produce the desired effect. We will also strengthen focused efforts to tackle problems such as high bride price, cash gift competition, luxurious funerals, and lack of family support to the elderly in order to promote a positive cultural environment in civil and neighborly communities that features good family traditions and simple and honest people.
Third, we should explore new models and new platforms. In recent years, we carried out trials and demonstrations for developing a rural governance system and explored some good approaches, including using reward points and task lists. Next, we will step up efforts to promote the application of such approaches and set up clearly detailed standards, regulated procedures, and evaluation mechanisms in order to yield solid results in rural governance and deliver tangible benefits for farmers. Thank you.
_ueditor_page_break_tag_Yicai:
In recent years, China's annual import volume of soybeans amounts to about 100 million metric tons. Although the figure in 2021 declined, the total amount was still huge. What measures does the No. 1 Central Document propose to enhance the production capacity of soybeans and oil plants? Thank you.
Tang Renjian:
Currently, despite of the status of tight balance between supply and demand of grain in China, people don't have to worry about not having enough food. There is a structural problem that China still experiences low self-sufficiency in soybeans and oil plants. Due to the improvement of living conditions and the growth of animal husbandry, China's demand for soybeans has increased remarkably, and its imports have seen rapid growth. As you mentioned, China's import volume of soybeans amounted to 100 million metric tons in 2020 and over 90 million metric tons in 2021. Currently, China's domestic soybeans can meet the need of food consumption. That is to say that our consumption of tofu and other soybean products is well guaranteed. Imported soybeans are mainly used to make edible vegetable oil and plant proteins for animal feed of husbandry. Looking forward, we will make full use of domestic and international markets and their resources to increase the supply of soybeans and oil plants. But more importantly, we need to focus on self-improvement and make more efforts on structural optimization. We need to be more determined in enhancing the production capacity of soybeans and oil plants and plant oil crops as much as we can in a bid to have more control over the edible oil security of Chinese people. We need to make efforts mainly in the following three aspects:
First, we need to proactively restore soybean planting areas in northeast China. As we know, the northeastern region is traditionally a major soybean-producing area. We will improve the policy on subsidizing corn and soybean production, support the region to carry out reasonable crop rotation of corn and soybeans and encourage farmers to plant soybeans this spring. In the meantime, some areas in northeast China, mainly those with the problem of groundwater overexploitation, can plant more soybeans by turning paddy fields into dry land. The northeastern region used to grow rice many years ago, but the conditions in some areas were not suitable. Thus, we can resume soybean planting in these areas.
Second, we need to proactively promote corn-soybean strip cropping. Instead of planting alternate rows of corn and soybeans, people often plant two rows of corn, alternating with four rows of soybeans in pilot zones. Thus, it is called strip cropping, and both plants can receive adequate natural sunlight to grow. The corn-soybean strip cropping has been piloted for many years, especially in southwestern regions like Sichuan province. Currently, there are over seven million mu (about 466,667 hectares) of strip cropping areas in China, and the planting model and techniques have grown mature basically. The biggest advantage of strip cropping is that it can solve the problem of exclusiveness between corn and soybeans because in the past, people could only plant one of them in the same area, but not the both. With strip cropping, we can make sure that corn yield does not decline on the whole and realize its stable production. Meanwhile, an additional 100 to 150 kilograms of soybeans can be harvested per mu every harvest season. This is pretty good news for farmers. This year, we plan to further promote this method and carry out corn-soybean strip cropping in suitable areas such as those along the Yellow River, Huai River, and Hai River, as well as southwest and northwest China. Still, because this method was only experimented in pilot areas and many regions are not familiar with it, we need to provide relevant assistance such as grain varieties, equipment, and techniques. With this in mind, the central government has allocated special subsidies to support . Additional funds will be taken from the commercial services sector and allocated to large-scale business entities that undertake relevant tasks so as to increase their willingness to promote corn-soybean strip cropping. Besides, we are also working to include strip cropping in the scope of agricultural insurance in some areas.
Third, we need to proactively enhance the production capacity of oil plants. There are many oil plants besides soybeans, such as rapeseed along the Yangtze River, peanuts in the northern and northwestern regions and North China, and camellia in the southern regions. All these need further development. In terms of rapeseed, the winter fallow in south China has huge potential. In 2021, more than five million mu of such fields were added, and we plan to expand more this year. As for peanuts, the key planting regions include areas along the Yellow River, Huai River, and Hai River and the agro-pastoral zone in the north, also known as regions along the 400 mm precipitation line. We need to promote crop rotation of corn and peanuts here and stabilize and expand the areas of land under peanuts cultivation. Regarding camellia, we need to focus on expanding its farming areas. Despite the substantial production potential, the output volume of camellia is very little nowadays, and we need to improve farmlands with a middle or low output. In addition, there are also other special oil plants such as sunflowers, flax, and sesame, and we need to promote their growth based on the actual local conditions.
In conclusion, with a variety of oil plans and diversified measures, we hope that China's self-sufficiency of soybeans and oil plants could see a comparatively huge improvement in five to 10 years. Thank you.
Chen Wenjun:
Since there are no further questions, today's press conference is hereby concluded. Thank you to all the speakers and friends from the media. Goodbye.
Translated and edited by Zhang Lulu, Ma Yujia, Zhou Jing, Huang Shan, Zhang Liying, Wang Yanfang, Zhang Rui, Wang Yiming, Li Xiao, Zhu Bochen, Wang Qian, Yuan Fang, Cui Can, Yang Xi, Gong Yingchun, David Ball, Jay Birbeck, and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Liu Kun, minister of finance
Yu Weiping, vice minister of finance
Xu Hongcai, vice minister of finance
Chairperson:
Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Feb. 22, 2022
Chen Wenjun:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are delighted to be joined by Mr. Liu Kun, minister of finance, who will introduce China's fiscal reform and development, and answer your questions. Also present at the press conference today are Mr. Yu Weiping and Mr. Xu Hongcai, both vice ministers of finance.
Now, I will give the floor to Mr. Liu.
Liu Kun:
Ladies and gentlemen, friends from the media, good morning. I am glad to meet you ahead of the "two sessions." On behalf of the Ministry of Finance (MOF), I would like to express my heartfelt gratitude to friends from the media for your constant interest and support regarding China's fiscal development. Now, I will introduce the fiscal work in 2021.
2021 was a landmark year in the history of our Party and our country. Faced with complex and severe domestic and international contexts, as well as multiple risks and challenges, the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core has rallied and led the Chinese people of all ethnic groups to forge ahead, making major achievements in various undertakings of the Party and the country. The MOF has followed the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and borne in mind the country's most fundamental interests. In accordance with the decisions and plans of the CPC Central Committee and the State Council, we have implemented a proactive fiscal policy, taken solid steps to ensure stability on the six fronts (employment, finance, foreign trade, foreign investment, domestic investment and market expectations) and security in the six areas (residential employment, people's livelihood, market entities, food and energy, stability of industrial and supply chains, and grassroots operations), and worked to achieve new progress in creating a new development dynamic and promoting high-quality development. Revenue in the national general public budget reached 20.25 trillion yuan, an increase of 10.7% over the previous year, and in line with the budget. Expenditure in the national general public budget reached 24.63 trillion yuan, an increase of 0.3% year on year, providing a solid fiscal foundation for a good start to the 14th Five-Year Plan (2021-2025) period.
First, we rolled out stronger policies to sustain steady economic recovery. General Secretary Xi Jinping emphasized that scientific macro control and effective government administration are the intrinsic requirements for exploiting the advantages of the socialist market economy system . In 2021, we enhanced cross-cycle adjustment, strengthened unified management of funds and maintained the necessary scale of government expenditure to ensure major economic indicators stayed within an appropriate range. We issued 3.65 trillion yuan of local government special purpose bonds and adjusted the pace according to economic developments, thus playing an important role in maintaining stable growth and tackling areas of weaknesses. We implemented targeted tax and fee reduction policies and made further tax and fee cuts of about 1.1 trillion yuan to help enterprises overcome difficulties and achieve development. We worked to normalize the straight transfer of funds and expand coverage of the mechanism. Funds totaling 2.8 trillion yuan went straight to primary-level governments, which in turn benefited enterprises and the people. Meanwhile, we implemented the requirement for the Party and government institutions to keep tightening their belts, continued negative growth in central government expenditure, and channeled saved funds to bolster financial support for local governments to improve the people's well-being. We improved the quality, efficiency and sustainability of the proactive fiscal policy to offset downward economic pressure and keep the fundamentals of the overall economy stable.
Second, we supported the development of science and technology and promoted the upgrading and stabilization of industrial and supply chains. General Secretary Xi Jinping emphasized that the essence of the new development dynamic is realizing a high level of self-reliance . The MOF implemented the innovation-driven development strategy. We continued to invest more in science and technology. In 2021, we spent 0.97 trillion yuan on science and technology, an increase of 7.2% over the previous year, to provide strong support for the development of integrated circuits, new energy vehicles, and other industries as well as major breakthroughs in core technologies in key fields. At the same time, we innovated and improved policies and mechanisms. We reformed and optimized the management of research funding allocated by the central government, introduced new preferential tax and fee policies, granted subsidies for small- and medium-sized enterprises (SMEs) with high growth potential, advanced technology and strong market competitive edge, and implemented an open competition mechanism to select the best candidates. These measures are aimed at stimulating the innovation and creativity of researchers and enterprises.
Third, we have increased investment in living standards, and people's sense of fulfillment, happiness, and security have been significantly enhanced. General Secretary Xi Jinping emphasized that the people are the country. As we have fought to establish and consolidate our leadership over the country, we have in fact been fighting to earn and keep the people's support and to ensure them a good life. The MOF has always adhered to the people-centered philosophy of development, coordinated the needs of the people and the possibility of financial resources, and continued to strengthen fundamental well-being for all and ensure there is a cushion in place for those most in need. In 2021, public spending on education stood at 3.76 trillion yuan, up 3.5% over the previous year.
Meanwhile, public expenditure on social security and employment amounted to 3.39 trillion yuan, up 4% over the previous year. Despite enormous public spending in 2020 due to the COVID-19 pandemic, we still ensured high spending on improving people's lives in 2021. Therefore, the scale of expenditure in 2021 was basically the same as that of the previous year, and multiple livelihood policies were effectively implemented.
Fourth, we have promoted the coordinated development of urban and rural areas and further optimized the development pattern. General Secretary Xi Jinping emphasized that coordination is the means, end, and evaluation criterion of development. The MOF firmly followed the new development philosophy and ensured that the transfer payments, fiscal and tax policies, and other instruments were given full play to improve the balance and coordination of urban and rural regional development. In 2021, the central government's transfer payments (including tax rebates) made to local governments topped 8 trillion yuan, with a priority on areas with financial difficulties and underdeveloped regions, so as to enhance the financial guarantee capability for the coordinated development of urban and rural areas. We worked to ensure the effectiveness of major assistance policies and supported consolidating and expanding the country's poverty alleviation achievements and guaranteeing a smooth transition into rural vitalization. In addition, we implemented major national regional strategies such as developing the Yangtze River Economic Belt and the construction of the Guangdong-Hong Kong-Macao Greater Bay Area and promoted coordinated regional development to a higher level and better quality.
Fifth, we have strengthened ecological protection and continue to make our skies bluer, waters clearer, and mountains greener. General Secretary Xi Jinping emphasized that lucid waters and lush mountains are both natural and economic wealth. We must keep in mind that lucid waters and lush mountains are invaluable assets. The MOF resolutely implemented Xi Jinping's Thought on Ecological Civilization, and comprehensively employed policies and measures such as fiscal fund guidance, tax adjustment, and government green procurement to support resource conservation and ecological, environmental protection, and vigorously promoted the transition and economic and social development featuring green and low carbon. In 2021, the national fiscal investment in ecological and environmental protection reached 821 billion yuan. In addition, we introduced an action plan to support the establishment of a horizontal eco-compensation mechanism in the entire Yangtze River Basin, strengthened the role of taxation in regulating the ecological environment protection, and improved government green procurement policies.
Sixth, we have deepened fiscal and tax system reforms and strengthened the supervision of fiscal management. General Secretary Xi Jinping emphasized that good fiscal and taxation systems are the institutional guarantee for improving resources allocation, maintaining market unity, promoting social equity, and realizing enduring peace and stability. Therefore, playing an active and leading role, the MOF has deepened fiscal and taxation reforms speedily and steadily and expedited the building of a modern public finance system. In 2021, we promoted tax legislation such as value-added tax, further deepened the reform of the budget management system, carried out the evaluation of transfer payment and major expenditure policies, promulgated administrative regulations on state-owned assets, and promoted the launch of integrated budget management systems in all provinces. Meanwhile, we carried out special campaigns rectifying violations in four types of activities, including the unlicensed operation of accounting firms, and the supervision of financial management was further strengthened.
Ladies and gentlemen, friends from the media, 2022 is an important year as China enters a new era of building a modern socialist country in an all-round way and strides toward the second centenary goal. The CPC will hold its 20th National Congress, and it is significant to do public finance work well. The MOF will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, resolutely uphold General Secretary Xi Jinping's core position on the Party Central Committee and in the Party as a whole, and resolutely uphold the Party Central Committee's authority and its centralized, unified leadership. We will also bear in mind the country's most fundamental interests, improve the efficiency of fiscal policies, pay more attention to the precision and sustainability of policies, and exert the role of policies in advance.
In these ways, we will contribute to sound and sustained economic development and social stability, paving the way for the 20th National Party Congress with actions.
That concludes my introduction. Next, my colleagues and I would like to answer your questions. Thank you all!
_ueditor_page_break_tag_Chen Wenjun:
Thank you, Mr. Liu. Now the floor is open for questions. Please identify the news outlet your work for before raising questions.
CCTV:
At the Central Economic Work Conference, it was noted that the proactive fiscal policy would be implemented in a more effective, targeted, and sustainable way. Therefore, would you like to elaborate on this, and explain how fiscal policy will play a role at an earlier stage? Thanks.
Liu Kun:
Thank you for your questions. The proactive fiscal policy will be implemented in a more effective, targeted, and sustainable way, which is the major decision made by the Central Committee of the CPC and the State Council after assessing the domestic and international situations. It aligns with the new development philosophy and the general principle of prioritizing stability and pursuing progress while ensuring stability.
To implement the policy more effectively, we need to plan fiscal resources as a whole and improve budget compilation, review, expenditure, and performance-based budget management. In addition, we will work to see the evaluation results are linked to budget arrangement, strengthen the coordination with monetary policy, and ensure macro policies are stable and effective.
To implement the policy in a more targeted way, we need to focus on the high-quality development of manufacturing, easing difficulties for micro-, small- and medium-sized enterprises, scientific and technological innovations, and ramp up efforts to cut taxes and fees. We will also further improve the composition of fiscal spending and truly live on a tight budget, while at the same time working harder to provide funds for ensuring people's basic living needs, major areas, local governments, and especially the grassroots level.
To implement the policy more sustainably, we need to arrange budget allocation based on what is necessary and possible. We must ensure and enhance public well-being in development instead of aiming too high and making the goals tantalizingly out of reach. We will keep the deficit-to-GDP ratio at safe levels and keep the debt under control scientifically to effectively prevent and defuse risks.
You asked me how fiscal policy can play its role at an earlier stage. In fact, it means that we need to make the best use of our policies and plan such policies in advance. The sooner the policies are rolled out, the better the policies take effect. If you pay heed to financial news, you may notice that there have been several policies introduced on cutting tax and fees from the fourth quarter of last year to this January. And we will carry out work in the following aspects:
First, we will ramp up efforts to cut taxes and fees. Last year, we cut 1.1 trillion yuan of taxes and fees. Based on that, we will take more extensive measures to cut taxes and fees this year, to help market entities gain a stronger sense of accomplishment.
Second, we will maintain an appropriate spending intensity. We will focus on achieving major scientific and technological breakthroughs, ecological and environmental protection, ensuring basic living needs, major regional strategies, modern agriculture, and major projects outlined in the 14th Five-Year Plan. We will work to see more targeted budgetary investment and avoid the money being spread too thin.
Third, we will appropriately arrange special local government bonds. At the end of last year, we allocated 1.46 trillion yuan in advance from the country's 2022 quota for special local government bonds. In January, local governments issued 484.4 billion yuan in special bonds, accounting for a third of the advance quota. The money from the special bonds was used in infrastructure for transportation, municipal facilities and industrial parks, construction projects for affordable housing, and other key areas. In fact, some of the quota at the end of last year were saved for this year's use, so you may see that many new projects at local levels have already broken ground, and many of those projects have accessed funds from the special bonds.
Fourth, we will increase the scale of transfer payments from central to local governments. This year, we will arrange a considerable increase in the scale of transfer payments from central to local governments, especially the general transfer payments, which will continue to be weighted toward poor and less-developed areas and support grassroots governments in their efforts to ensure payment of salaries, normal operations, and the basic wellbeing of the people.
Fifth, Party and government institutions should tighten their belts. The central government will lead by example in living on a tight budget and cut non-essential and non-obligatory expenditures. Governments at local levels should also tighten their belts and advocate thrifty and frugal working.
Sixth, we will tighten up financial discipline. We will work harder to improve financial orders at local levels and ensure that the financial discipline becomes the "red line" that cannot be crossed.
_ueditor_page_break_tag_CRNTT:
In recent years, the central government has taken the lead in living on a tight budget, and the saved money has been used to improve people's wellbeing. So what are the considerations for the central government to live on a tight budget this year? Thanks.
Liu Kun:
You asked a question that is concerned by all. Just like you said, the government is now living on a tighter budget. Take the central government as an example. The expenditure at the central level has registered negative growth for two years in a row. In addition, the spending on official overseas visits, official vehicles, and official hospitality have been cut for successive years, declining from 8.107 billion yuan in 2019 to 5.187 billion yuan in 2021, down by 36%.
However, I want to make it clear that tightening the belt of the government is a policy that we must uphold on a long-term basis, rather than it being a short-term measure. General Secretary Xi Jinping emphasized on many occasions that the Party and the government tighten their belts to let the people live better lives — it is a move determined by the nature and the mission of the Party. To limit government spending, we should implement the instructions and demands of General Secretary Xi Jinping. Party and government departments, the central government organs, in particular, should set an example by practicing thrift and economy, and invest the money saved to improve people's livelihoods and support market entities. This policy was not adopted as a result of fiscal pressures.
Remaining committed to the instructions of General Secretary Xi Jinping, we will ensure austerity in all endeavors — taking it as kind of political awareness and political responsibility — and keep government spending low and enrich our people.
First, we will cut expenditures in a scientific way. This year, the central government will further cut outlays on non-obligatory and non-essential items, save money that is supposed to be saved, and ensure outlays on the operation of government departments and other essential items.
Second, we will continue to live on a tight budget. We will take rigid measures to control expenditures on meetings, trips, training programs, and forums, prohibit the construction of new government buildings or the extension to such facilities, ban unnecessary meetings and projects, and cut out or reduce spending whenever and wherever possible.
Third, we will see that funds are put to better and more effective use. We will keep track of the efficiency of fund use, and carry out performance evaluations to push all departments to improve the efficiency of fund use and make every cent count. Thank you.
_ueditor_page_break_tag_The Poster News APP:
Some small and medium-sized businesses have been hit hard by the COVID-19 pandemic. What specific measures has the finance ministry taken to support those enterprises? Thank you.
Liu Kun:
Vice minister Yu Weiping will answer this question.
Yu Weiping:
Micro, small and medium-sized enterprises prop up economic and social development and play an indispensable role in creating jobs, promoting technological innovations, and improving people's livelihoods.
Due to the impact of COVID-19, some small and medium-sized enterprises are facing difficulties with production and operation. The MOF has worked out and introduced a series of policies in accordance with the decisions and plans of the CPC Central Committee and the State Council to help them overcome difficulties, revive, and achieve better development.
First, we have reduced the tax burden on small and medium-sized enterprises. We continue to cut taxes and fees, postponing the payment of all the domestic value-added tax and corporate income tax for small and micro manufacturing enterprises, and postponing the payment of 50% of those taxes for medium-sized manufacturing enterprises. We have extended the validity period of the policies on temporarily reducing the premiums for unemployment insurance and workers' compensation insurance. We cut about 1.1 trillion yuan of taxes and fees last year, as Mr. Liu just said, and micro, small, and medium-sized enterprises benefited the most from it.
Second, we have alleviated the difficulty and high cost of financing for micro, small, and medium-sized enterprises. In 2021, the central government allocated 3 billion yuan of funds for rewards and subsidies to support the expansion of the scale of financing guarantees and the reduction of guarantee fees for small and micro enterprises . The reduction of financing guarantee fees for market entities surpassed 10 billion yuan throughout the year. We have continued offering greater financial support to subsidize interest payments on guarantee loans for business startups . In 2021, the central government made 6.34 billion yuan in funds available for subsidizing the interest payments and for rewards and subsidies, up 65.9% year on year. We have supported the construction of demonstration zones for inclusive finance to improve the financing environment for micro, small, and medium-sized enterprises.
Third, we have supported the high-quality development of those small and medium-sized enterprises which specialize in a niche market and boast cutting-edge technologies . From 2018 to 2022, the central government allocated about 9 billion yuan for innovation and entrepreneurship of small and medium-sized enterprises. In 2021, it offered funds for rewards and subsidies to support the development of small and medium-sized enterprises which specialize in a niche market and boast cutting-edge technologies, realizing the nationwide coverage of such "little giant" firms . At present, there are over 300 listed "little giant" firms. Their average growth rates of operating revenue and net profit in the past two years both exceeded 25%, about twice the average of all listed companies.
Next, the MOF will focus on helping micro, small, and medium-sized enterprises overcome difficulties and achieve better development. We will further step up tax cuts, and use financing guarantees, subsidies for interest payments on guarantee loans, and rewards and subsidies to guide and mobilize financial resources towards micro, small, and medium-sized enterprises so that they show greater vitality. Thank you.
_ueditor_page_break_tag_Bloomberg:
I have three questions. I'll be very quick. Most of the provinces expect weaker revenue growth this year while spending continues to increase. What's your estimate for national income and spending this year? And what will the central government do to help regional governments meet their needs? What is your target for tax and fee cuts this year? And in the People's Daily last Friday, you wrote that transfer payments from the central government to local governments will be increased by a relatively large margin. How big do you estimate this payment will be? And how will this help offset the impact of tax and fee cuts? Thank you.
Liu Kun:
Your questions are highly specialized. I'd like to answer them. As a matter of fact, your questions involve our need to set an appropriate deficit-to-GDP ratio target, increasing spending, implementing larger tax and fee cuts, and increasing transfer payments to local governments. In view of the composition of your three questions, you may feel that some of these goals are hard to achieve, but China's socialist system has its strength. And we want to solve these problems properly and hope to achieve our goals this year. The answers I give you today may be brief, but I hope and expect you will find them in this year's budget report to the National People's Congress.
You mentioned that the regional revenue is expected to be relatively low. In fact, this is a result of our arrangement for tax and fee cuts, which is still under approval, while the overall direction is clear. That's why local governments have taken tax and fee cuts into account when they forecast their revenue. However, we will increase transfer payments from the central government to local governments to make up for the loss of local revenue.
Mr. Xu Hongcai is in charge of the budget. I'd like to invite him to provide a more detailed answer.
Xu Hongcai:
Thank you for your questions. Your questions are really important, and can be summed up below. The first question is about the imbalance between revenue and spending this year –weaker revenue growth and increased spending. This creates a contradiction between revenue and spending. The second one, or the third question you asked, relates to what the central government will do in such circumstances to increase transfer payments to local governments and ensure their spending can be guaranteed. The third question involves budget arrangements and this year's target. I will answer them one by one in this order.
Tax and fee cuts are indeed an issue of great concern to market entities. In recent years, the MOF has taken it as an important first move in stimulating the vitality of market entities, and strived to reduce government revenue for increasing corporate performance and boosting market vitality. We use tax and fee cuts to boost economic growth. As a matter of fact, tax and fee cuts appear to reduce revenue, but in fact they will bring economic growth and subsequent fiscal revenue increases. Here, I would like to share with you some data.
The first is 1.1 trillion yuan. This was the scale of tax and fee cuts nationwide in 2021, with a focus on supporting the upgrading of the manufacturing sector and the development of micro, small, and medium-sized businesses as well as self-employed individuals. The 1.1 trillion yuan in tax and fee cuts were achieved against the backdrop of continued tax and fee cuts in the last few years as well as growing pressure from fiscal imbalance. We have effectively helped market entities overcome difficulties and stimulated their vitality with solid measures.
Second, in the six years since the beginning of the 13th Five-Year Plan (2016), China reduced 8.6 trillion yuan in taxes and fees, an unprecedented scale in China's history and a relatively large scale worldwide. Through continued tax and fee cuts, the ratio of tax revenue in China's GDP also decreased from 17.5% in 2016 to 15.1% in 2021.
Now comes the third set of data. In total, there are more than 150 million market entities in China. Among them, 13.26 million were newly set up in 2021 and have engaged in tax-related activities, up 15.9% year on year. The implementation of tax and fee cuts has eased the burden of millions of market entities, strengthened economic resilience, and played an important role in meeting challenges and stabilizing economic fundamentals.
What we wish is that businesses can sustain themselves and assure success for the future. As I mentioned just now, despite the expected sluggish revenue growth and serious budgetary constraints, our tax and fee-cutting policies will bolster economic growth and gradually boost fiscal revenue. This year, finance departments will resolutely carry out the decisions and deployments of the CPC Central Committee and conscientiously implement a combination of policies to cut taxes and fees so as to further vitalize market entities.
First, the policies will be expanded. We will continue extending a total of 11 tax and fee reduction policies to the fields such as science and technology, employment, business start-ups, health care, and education. Some of the policies will be more preferential than before, and a slew of new measures will be adopted as soon as possible.
Second, the policies will be more targeted. In particular, we will formulate a series of supporting policies in order to boost the high-quality development of manufacturing and help micro, small, and medium-sized enterprises overcome difficulties and promote sci-tech innovation.
Third, the policies will be well coordinated. We will coordinate tax and fee-reducing policies with other incentives such as proactive fiscal policy, monetary policy, and industrial policy so that we can lend the needy a strong hand through the synergy gains.
Your second question, according to my understanding, is about how to guarantee local governments' fiscal expenditure as the growth of local fiscal revenue slows due to the tax and fee cuts. Mr. Liu has given the answer: The central finance will increase its transfer payments to local governments, a priority of this year's central budget. The increased transfer payments will be mainly channeled to regions in financial difficulty, underdeveloped areas, and places where revenues dramatically dropped because of tax and fee cuts. Meanwhile, we will improve incentive and constraint mechanisms, encourage local governments, at both provincial and municipal levels, to reinforce financial resources at the county level. We will further increase transfer payments, adopt related guiding policies, and support local governments' efforts in cutting taxes and fees and ensure payment of salaries, normal operations, and the basic wellbeing of the people, thus securing the sound operation of local finances. As always, certain funds will go straight to the targeted areas to meet their policy goals.
Your third question is about this year's targets for tax and fee cuts. Mr. Liu has suggested you watch the budget report to be issued at the upcoming NPC session. It will tell you all.
Thank you.
_ueditor_page_break_tag_Science and Technology Daily:
Regarding the fifth plenary session of the 19th CPC Central Committee valued sci-tech self-reliance and self-strengthening as a strategic underpinning for national development, we noticed that the MOF had taken a number of measures to innovate research funding management and support basic research. Can you give us more details? Thank you.
Yu Weiping:
Thank you for your question, and I do appreciate your concerns. Viewing the course of human history and the country's future from a comprehensive and strategic perspective, General Secretary Xi Jinping has repeatedly emphasized that sci-tech self-reliance and self-strengthening should aways be considered a strategic support for national development, urging more efforts to build up China's strength in science and technology and strive for sci-tech self-reliance and self-strengthening at higher levels. Making sci-tech self-reliance a priority, the MOF has continuously scaled up investment, deepened management reforms, and innovated and perfected policies, steadily advancing the cause of building China into a sci-tech giant. Despite of the negative growth in its budgetary spending in 2021, the central government managed to allocate 320.554 billion yuan to the science and technology sector through adjusting its spending structure.
First, we helped solidify the sci-tech foundation through continuously stepping up investment in basic research. In 2021, the central government's spending on basic research increased by 15.3%, mainly directed to natural science funds and basic research work of the Chinese Academy of Sciences. We also further improved the institutions and mechanisms designed to support basic research and original innovation.
Second, we helped achieve sci-tech breakthroughs. Leveraging the new whole-nation system in a market economy, we successfully advanced the implementation of a batch of major sci-tech programs. With our financial support, an open competition mechanism was introduced to select the best candidates to lead key research projects with the aim of achieving breakthroughs in core technologies in key areas.
Third, focus on priorities. We have advanced the construction of national laboratories, supported reforms and development of research institutes, and promoted the building of high-level research-oriented universities. We have supported innovative organizations in cultivating, introducing and hiring scientific and technological talents, accelerated the construction of a major world center for professional talent and innovation, and boosted the country's strategic scientific and technological strength.
Fourth, promote development. We have boosted the principal role of enterprises in innovation, and supported enterprises to establish innovation alliances to undertake national scientific research tasks, and promoted the integration of industrial and innovation chains. We have improved the tax policies that support innovation, encouraged enterprises to increase R&D spending, and promoted close integration of science and technology with economic development. During the first three quarters of last year, the amount of R&D spending by enterprises eligible for additional tax deductions was 1.3 trillion yuan, with 330 billion yuan in tax cuts and exemptions.
Fifth, promote reforms. We have improved the management of central government funds for scientific research, and granted greater autonomy in the management of scientific research funds. The number of budget items has been drastically reduced from more than nine to three. The three items are equipment cost, operating expenses and labor cost. The proportion of indirect expenses has been increased, and the proportion of scientific research funds spent on people reached more than 50%. Bureaucratic burdens of scientific research personnel have been reduced to create a good environment for them to devote themselves to research and make more high-quality scientific research achievements.
If scientific and technological capabilities are strong, the country will be strong. The MOF will strengthen support of fiscal and tax policies and funds, optimize the structure of scientific research expenditure, promote the implementation of scientific research policies and ensure that science and technology, one of the country's most powerful weapons, can better serve the high-quality development and promote the building of a great modern socialist China in all respects. Thank you.
_ueditor_page_break_tag_Yicai:
Since the system of direct fiscal fund allocation was established, fiscal funds of the central government have reached local primary-level governments at a faster rate. Could you give us more details on this? What new measures will be rolled out in terms of improving the system? Thank you.
Liu Kun:
Thank you for your questions. Just now, Mr. Xu talked about the system of direct fiscal fund allocation. I'd like to invite him to answer your questions.
Xu Hongcai:
Thank you for your questions. Establishing the system of direct fiscal fund allocation is an important decision made by the CPC Central Committee and the State Council, and also a significant innovation in fiscal management. In 2021, the MOF joined relevant departments to regularize the system of direct fiscal fund allocation, and expand its scope. By "regularize" we mean making the direct allocation of budgetary funds to prefecture- and county-level governments during a particular period of 2020 a normal practice, and expanding the system's coverage. Based on the operations last year, the system has given full play to its advantage of directly allocating those funds to primary-level governments, and improved both management efficiency and fund efficiency. Its characteristics are as follows:
First, fast allocation. Fiscal fund allocation took the "direct train" straight to the primary level, directly benefitting businesses and people, and greatly reducing the "travel time." The operation mode of the system of direct fiscal fund allocation last year was different from that of the year before last. When compiling the budget at the beginning of last year, the central government asked provincial-level governments to allocate fiscal funds in 10-30 days, which was longer than the preceding year. Based on feedback from monitoring the direct fiscal fund allocation, most provincial-level governments completed fund allocation in around 10 days, which was really fast, and faster compared with general fund or non-direct transfer payment funds. According to statistics of direct fiscal fund allocation released at the end of last year, the rate of direct fiscal fund allocation was much faster than that of the general public budget, which shows the advantage of being fast.
Second, targeted manner. Annual statistics show 2.8 trillion yuan of direct fiscal funds, of which 2.67 trillion yuan has arrived at fund users. The directly allocated fiscal funds mainly supported local employment, people's well-being, the operation of market entities, wage payments and the normal functioning of primary-level governments. According to incomplete statistics, spending on people's well-being including elderly care services, compulsory education, basic medical services and basic housing services reached almost 2 trillion yuan, fiscal funds directly used for employment exceeded 51 billion yuan, and fiscal funds directly used for relevant enterprises exceeded 600 billion yuan, benefiting more than 1.66 million market entities, which shows that targeted measures based on specific conditions have been effective.
Third, funds directly allocated to primary-level governments and businesses are under strict supervision. We need to give better play to the role of the relevant supervision system and expose these funds to more supervisory bodies to avoid the decline in quality due to high efficiency. The supervision system covers central, provincial, city, and county-level authorities. In terms of the central government, fiscal and auditing bodies and other relevant bodies have all been connected via the internet so that everyone can have access to the flow, allocation, and spending of funds on one internet platform. The supervision efforts in this regard are stricter than that of other kinds of funds. The National Audit Office has carried out follow-up auditing work on implementing major national policies. The results show comparatively fewer violations of regulations concerning these directly-funneled funds. Funds involved in violation of regulations account for a relatively small part, and the use of these funds is more regulated. As the supervision system continues to work, problems will be timely identified and corrected.
This year, we will earnestly review existing experience and practices, further expand the scope of directly-funneled funds and improve the management system. In addition, we will strengthen supervision on these funds and make sure they are used safely and efficiently and based on regulations to give better play to their role and serve for economic and social development.
Thank you.
_ueditor_page_break_tag_Xinhua News Agency:
In recent years, we have felt the continuous improvement of the environment around us, and more blue-sky days have been reported. What measures did the MOF take to help win the battle of pollution prevention and control? What are your next plans? Thank you.
Liu Kun:
Thank you. You've raised an excellent question. A fine ecological environment is the fairest public product and the most accessible welfare for the people. The government funding should provide the fairest public goods. General Secretary Xi Jinping has stressed on multiple occasions that lucid waters and lush mountains are invaluable assets and that we should protect Nature and preserve the environment like we protect our eyes and endeavor to foster a new relationship where man and Nature can both prosper and live in harmony. The MOF has thoroughly studied General Secretary Xi Jinping's views and proposals, comprehensively made use of fiscal policies, and supported the resource conservation and the protection of the ecosystem and environment to better meet people's needs for a good environment. We have mainly made efforts in the following three aspects:
First, investment has been increased. In 2021, the central government allocated 437.4 billion yuan for eco-environmental protection. In the meantime, the MOF innovated methods for fiscal administration and proactively gave full play to the leveraging role of government funds. Through the national green development fund, provincial-level funds for the prevention and control of soil pollution, and others, the MOF has encouraged private capitals to participate in eco-environmental protection and treatment.
Second, more efforts have been made on key issues. Since the 18th CPC National Congress, the central government has set up special funds to manage water, air, and soil. These funds are used to protect our blue skies, clear waters, and clean lands, with special efforts to address prominent eco-environmental issues and help significantly improve the environment. Due to financial investment and efforts of the whole society, we have seen remarkable results. Take blue skies, for an example. In 2021, the PM2.5 density of cities at or above the prefectural level decreased 9.1% over the previous year, and 87.5% of days saw good or excellent air quality. I believe that every citizen can feel the obvious improvement in this field in their daily lives.
Third, the long-term mechanism has been established. The MOF set up mechanisms for trans-regional and intra-watershed compensation for ecological conservation efforts in all river basins of the Yangtze River and the Yellow River. We have also made coordinated efforts in the systematic governance of mountains, rivers, forests, farmland, lakes, grasslands, deserts, and glaciers. We established nature reserve systems based on national parks, continuously improved green government procurement policies, and effectively promoted the green and low-carbon transformation of the economy and society.
If we do not fail Nature, Nature shall never fail us. Therefore, the MOF will firmly carry out Xi Jinping thought on eco-civilization, continuously increase investments and solve prominent environment problems as soon as possible, and help secure victory in the prolonged battle of environmental protection, in a bid to make skies bluer, mountains lusher, and waters clearer. Thank you.
_ueditor_page_break_tag_Economic Daily:
In January, special bonds were issued significantly faster than during the same period last year. What were the considerations behind this? And how have the funds been put into use? Thank you.
Liu Kun:
Vice Minister Xu Hongcai and I covered the questions you raised in his answers and in my opening remarks. I'd like to invite Mr. Xu to elaborate on the matter.
Xu Hongcai:
Thank you. This is an important question. As Finance Minister Liu Kun said, in 2022 we should adopt proactive fiscal policy in advance and make full use of the policy toolbox, issue policies earlier and see results earlier, so as to let the policies be more targeted and effective.. In line with the decisions and plans of the CPC Central Committee and the State Council, the MOF has allocated 1.46 trillion yuan (about $229 billion) from its 2022 quota for local government special bonds in advance, authorized by the National People's Congress (NPC) Standing Committee and agreed upon by the State Council.
The advance allocation is characterized by the country's proactive fiscal policy. The special bonds should be issued properly in accordance with the economic climate and macroeconomic regulation. China's economy is currently facing new downward pressure, which requires fiscal policies to be "brought forward appropriately." Set to be allocated in advance, issued and used at high speed, these special bonds are expected to encourage effective investment. As Minister Liu Kun introduced earlier, statistics show that many new projects were started and expenditures grew a lot. In January, local governments already issued 484.4 billion yuan of newly-added special bonds, accounting for 33.2%, or almost one-third, of the advanced allocation of 1.46 trillion yuan. Among the new bonds, about 30% were spent on infrastructure related to city planning and industrial parks, 20% on the construction of transportation infrastructure, 20% on fields related to social construction like education, healthcare and elderly care, and the remaining 30% was spent on other fields. We have launched this policy as part of implementing in advance the decisions and plans of the CPC Central Committee . The results in January were relatively good. In the following months, we will continue to provide guidance to local governments and help them speed up the use of funds, so as to accomplish the work as soon as possible and better promote economic growth.
Thank you.
_ueditor_page_break_tag_ThePaper.cn:
Affected by the pandemic, some local pensions are in deficit. How does the MOF ensure pension funds are paid on time and in full? This year, a unified elderly-care insurance system for enterprise employees will be implemented nationwide. How is this progressing? Thank you.
Liu Kun:
I'd like to stress first and foremost that the pension funds for retired people can be paid on time and in full everywhere in China. Next, Vice Minister Yu Weiping will answer your questions with some more details.
Yu Weiping:
Pension funds are the money that Chinese people entrust to the government to use for their basic living. The public pays great attention to the running of pensions. Let me give you some statistics. Preliminary data shows that the cumulative balance of social security funds nationwide totaled 4.8 trillion yuan, which can cover payments for more than 14 months. The revenue into social security funds exceeds expenditures, and like Minister Liu Kun said, the payment of pensions is guaranteed to be on time and in full.
We need to properly manage and use pension funds, so as to ensure that the hundreds of millions of elderly people can be well cared for. This manifests the practice of a people-centered development philosophy within finance departments. In recent years, we have adopted a series of measures to ensure the elderly across the country receive their pensions on time and in full.
The first is to increase the central government's subsidies. Since the implementation of the unified pension fund system in 1998, the central government has been increasing subsidies to the basic pension funds for enterprise employees. In 2021, the central government arranged subsidies of more than 600 billion yuan to support local governments to ease the pressure on fund revenue and expenditure.
The second is to increase the adjustment ratio. In 2021, the central adjustment ratio of basic pension funds for enterprise employees was increased to 4.5%, and the total scale of the adjustment has reached more than 930 billion yuan. The central government focused on supporting provinces with prominent revenue and expenditure problems – so China's central and western regions, as well as provinces with old industrial bases, have benefited with more than 210 billion yuan.
The third is to transfer state-owned capital to enrich social security funds. At the central government level, a total of 1.68 trillion yuan of state-owned capital from 93 central government enterprises was transferred to the funds.
The basic pension funds for enterprise employees is coordinated, and the funds complement each other across the country, which is conducive to giving full play to the funds' scale and enhancing their support capacity. This work was officially implemented on Jan. 1 this year. At present, we are speeding up the research and formulation of relevant supporting documents, measuring the scale of fund allocation, rationally adjusting the surplus and deficit of funds between regions, strengthening the tracking and guidance for local implementation work, adjusting and improving policies and measures in a timely manner, and getting the job done earnestly. Thank you.
_ueditor_page_break_tag_Chen Wenjun:
One last question.
China Daily:
The year 2021 was the first year for China to win the battle against poverty, as scheduled. I would like to ask what efforts the MOF has made in consolidating and expanding the achievements of poverty alleviation? What new plans will be taken in these aspects this year? Thank you.
Liu Kun:
Thank you for your questions. Poverty alleviation is the biggest concern of General Secretary Xi Jinping. The year 2021 was the first year of the transition period after China won the battle against poverty. The MOF has borne in mind General Secretary Xi Jinping's instruction of consolidating and extending the achievements of poverty alleviation while shifting toward, and pushing forward, all-around rural vitalization. We have maintained the overall stability of the central government's financial support policies, supported and firmly held the bottom line of preventing a large-scale return to poverty, and continued to push forward the economic and social development of poverty-alleviated regions.
First, we increased input. In 2021, the central government arranged 156.1 billion yuan of subsidies for shifting toward, and pushing forward, rural vitalization, an increase of 10 billion yuan from the central government's original poverty relief fund in 2020. We actively ensured funding for industry assistance. During the critical period of the battle against poverty, we gave transfer payments to 832 poverty-stricken counties. During the transition period, we continued to give transfer payments to poverty alleviated areas to ensure they get enough much-needed supplies to accelerate development. And we will continue to increase the funds in this regard.
Second, we highlighted precision. We promulgated the management measures for the central government's follow-up funds, which clearly defined the content of support and the negative list, meaning that this money can't be used in other aspects. We continued to delegate the approval authority for funding projects to counties. We continued to support poverty-alleviated counties to carry out pilot projects for the integration of agriculture-related funds, continued to implement policies such as tax incentives and government procurement, and provided institutional guarantees for the consolidation and follow-up work.
Third, we tracked the effects and results. We strengthened the performance evaluation of the central government's follow-up funds, and encouraged all regions and departments to manage and use the follow-up funds well. We supported the improvement of the monitoring and assistance mechanism to prevent the return to poverty, gave priority to supporting the development of characteristic and advantageous industries in poverty-alleviated areas, and helped the poverty-alleviated people continue to increase their incomes. We also increased follow-up support for families relocated from inhospitable areas and improved work and living conditions in poverty-alleviated areas.
With the joint efforts of all departments, positive results were achieved in consolidating and extending the achievements of poverty alleviation while effectively shifting and linking with rural vitalization, and the bottom line of preventing a large-scale return to poverty was guarded. According to the monitoring data, the income among people lifted out of poverty has continued to grow, and their per capita net income in 2021 was estimated to exceed 12,500 yuan. People's lives have been further improved.
General Secretary Xi Jinping has pointed out that the premise of rural vitalization is to consolidate the achievements of poverty alleviation, and we must continue to pay close attention to it. The central government will further strengthen the guarantee of input, and give priority to areas where the task of consolidating the achievements of poverty alleviation is heavy and the foundation to promote rural vitalization is weak. We will continue to enhance the ability of independent development in poverty-alleviated areas so that people's lives will become more and more prosperous. Thank you.
Chen Wenjun:
Thank you to Minister Liu Kun and to the two vice ministers. Also, thank you, friends from the media. That's it for today's press conference, goodbye.
Translated and edited by Zhang Liying, Wang Qian, Wang Yiming, Ma Yujia, Cui Can, Yuan Fang, He Shan, Zhang Jiaqi, Wang Wei, Duan Yaying, Huang Shan, Li Huiru, Yang Xi, Liu Qiang, Zhu Bochen, Wang Yanfang, Liu Sitong, Chen Xia, Zhang Rui, David Ball, Tom Arnstein, Jay Birbeck. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Wu Yanhua, vice administrator of the China National Space Administration (CNSA)
Xu Hongliang, spokesperson of the CNSA
Liu Jizhong, director of the Lunar Exploration and Space Program Center of the CNSA
Zhao Jian, director of the Earth Observation System and Data Center of the CNSA
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
Jan. 28, 2022
Xing Huina:
Ladies and gentlemen, friends from the media, good morning! Welcome to this press conference held by the State Council Information Office (SCIO).
Today, the SCIO is holding a press conference to issue, introduce and interpret the main contents of a new white paper titled "China's Space Program: A 2021 Perspective."
Thoroughly guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the white paper introduces China's practices and achievements in realizing innovative and leapfrog space development, modernizing space governance, and actively carrying out international space exchanges and cooperation. Furthermore, the paper explains China's policies and proposals in conducting international space communication and collaboration and facilitating building a global community of shared future in outer space. Finally, the paper also looks to the vision where China will embark on a new journey towards a space power and foster a new paradigm of international space cooperation over the next five years.
At about 13,000 Chinese characters, the white paper consists of three parts: the preamble, main body, and conclusion. The main body has six parts: A New Journey Towards a Strong Space Presence, Development of Space Technology and Systems, Developing and Expanding Space Application Industry, Research on Space Science, Modernizing Space Governance, and International Cooperation. The white paper is published in eight languages —Chinese, English, French, Russian, German, Spanish, Arabic, and Japanese — by the People's Publishing House and the Foreign Languages Press. It is available at Xinhua Bookstore outlets across the country.
In order to help you gain a more accurate and deep understanding of the white paper, we have invited Mr. Wu Yanhua, vice administrator of the China National Space Administration (CNSA); Mr. Xu Hongliang, spokesperson of the CNSA; Mr. Liu Jizhong, director of the Lunar Exploration and Space Program Center of the CNSA; and Mr. Zhao Jian, director of the Earth Observation System and Data Center of the CNSA, to attend today's press conference. They will introduce relevant information and answer your questions.
Now, I will give the floor to Mr. Wu Yanhua.
_ueditor_page_break_tag_Wu Yanhua:
Ladies and gentlemen, good morning. I am glad to meet you and grateful for your care and support for China's space industry. Today, we are here to release China's fifth white paper on space activities — "China's Space Program: A 2021 Perspective" — to enhance your understanding of China's space development and envision the bright prospects for cooperation. China's space industry has forged ahead, secured new achievements, and made great strides in the past five years: the Chang'e lunar probes exploring the moon; the BeiDou Navigation Satellite System (BDS) starting operation; the Zhurong rover probing Mars; the Xihe satellite exploring the sun; the Tianhe space station core module traveling among the stars; and the Dark Matter Particle Explorer (also known as Wukong or Monkey King) and the Huiyan (Insight) Hard X-ray Modulation Telescope unraveling the mysteries of the universe.
The last five years have seen innovation and development for China's space industry. With the accelerated improvement of launch vehicles, the new generation of non-toxic and pollution-free launch vehicles, such as Long March-5, are now in service. The commercial carrier rockets have continued to emerge, forming a diversified launching capability covering land and sea. Over the past five years, a total of 207 launch missions have been completed, with the success rate of the Long March series carrier rockets being 96.7%. Major space programs have born rich fruit. The construction of China's space station is fully underway. Six astronauts have been stationed in two missions, starting an era of long-term presence of people in the space station. The Chang'e-4 lunar probe has performed humanity's first-ever soft landing on the moon's far side and conducting roving explorations; the Chang'e-5 lunar probe has retrieved 1,731 g of samples. The Tianwen-1 mission has left China's first mark on Mars for the first time, helping the country achieve a leap from cislunar to interplanetary exploration. The infrastructure of China's space station has been consistently improved. The BDS has been completed and put into operation. Meanwhile, the high-resolution earth observation system has built systematic capabilities.
The last five years have seen China's space industry contributing to society. More than 500 satellites of various types are operating in orbit, extensively serving socio-economic development and playing an essential role in building a peaceful, beautiful, and digital China. Communications satellites have provided more than 140 million families in rural and remote areas with remote education, telemedicine, and rural e-commerce services. Therefore, they have contributed to poverty alleviation and rural vitalization. In addition, more than 100 million remote sensing satellite images have been distributed, effectively fulfilling the demands of weather forecasting, territorial planning, ecological protection, the marine economy, and disaster emergency management. The BeiDou system has been widely used for traveling, intelligent logistics, and precision agriculture, especially providing precise positioning and navigation services in COVID-19 prevention and control. The space technology achievements have promoted the development of emerging industries, such as new energy and materials, and facilitated the emergence of new business forms such as smart cities and unmanned driving. The development of commercial space enterprises is thriving.
Over the past five years, China's space industry has made continuous exploration and breakthroughs. It has focused on scientific topics such as the origin and evolution of the universe and the relations between the solar system and humanity. It has been supported by space science satellites and lunar exploration, Mars exploration, and manned space missions. As a result, China's space industry has carried out exploration and experimental research on space science and has made a number of innovative achievements that all humanity can share.
For example, the Huiyan Telescope successfully observed the black hole explosion process. The Wukong Explorer acquired the refined structure of the energy spectrum of cosmic rays. The satellite Zhangheng-1 built models of the global geomagnetic field, and the TANSAT satellite developed a high-precision map of the worldwide distribution of carbon dioxide. The lunar exploration missions revealed the subsurface structure of the moon's far side, confirming that there were still magmatic activities on the moon 2 billion years ago. Finally, Tianqin-1, Taiji-1, and Xihe satellites have provided new research methods regarding space gravitational waves and solar physics.
The last five years have seen enhanced cooperation and sharing in China's space industry. The Chinese space community has cooperated with international partners to help realize the United Nations 2030 Agenda for Sustainable Development goals by applying sustainable aerospace technologies. It also signed about 50 agreements or memorandums of understanding during the last five years. For example, China initiated the International Lunar Research Station project jointly with Russia and conducted extensive cooperation in manned space exploration, lunar exploration, and Mars exploration missions. In addition, it has agreed to cooperate on the BRICS Remote-Sensing Satellite Constellation and successfully launched the China-France Oceanography Satellite and the China-Italy Electromagnetic Monitoring Experiment Satellite. Furthermore, it has promoted the BeiDou standards to be included in the standard systems of several international organizations in the fields such as civil aviation and maritime affairs. Data from Gaofen-1 and Gaofen-6 satellites have been distributed freely worldwide via a cloud platform, with about 550,000 users from 158 countries and regions accessing the data. In addition, five of China's satellites and three satellite constellations have joined the mechanism of the International Charter on Space and Major Disasters, and meteorological satellite data have been used in 121 countries and regions. China has supported the space capacity building of developing countries and shared the achievements of China's space development through various means, including infrastructure construction, talent training, and data application.
In the following five years, China's space industry will continue to follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and adhere to the principles of innovation-driven, coordinated, efficient, and peaceful progress based on cooperation and sharing. Focusing on building China's strength in aerospace and developing a high-quality space industry will promote the comprehensive development of space science, space technologies, and space applications to contribute to building a great modern socialist country and to humanity's cause of peace and development.
First, we will promote the implementation of significant projects through innovation. We will build China's space station and the High-Resolution Earth Observation System, implement new major projects, including the fourth phase of the Lunar Exploration Program and planetary exploration, and promote the research and development of heavy-lift launch vehicles. We will establish near-earth asteroid impact risk response systems, develop essential programs such as the boundary exploration of the solar system, and further expand the launch vehicle family. Furthermore, we will continue to upgrade national space infrastructure and improve the ability of the space environment governance system.
Second, we will develop and expand the space application industry. We will promote the deep integration of space applications and the digital economy, enrich application scenarios, innovate business models, and deepen the comprehensive application of communications, navigation, and remote-sensing technologies. We will accelerate the transfer and transformation of space technology achievements to serve the economy and society and develop new business models of the space economy such as space travel, space biomedicine, and space breeding.
Third, we will make overall plans for research on space science. Critical areas such as space astronomy, space physics, lunar and planetary science, and space earth sciences will be systematically promoted. Space science satellites such as the satellite for space gravitational wave detection, the Einstein Probe, and an advanced space-based solar observatory will be developed. We will also use platforms including China's space station and lunar and deep space probes to continuously carry out frontier science exploration and basic research to generate more original scientific findings.
Fourth, we will create a sound environment for space industry development. The innovative systems that deeply integrate enterprises, universities, research institutes, and end-users will be improved and the fundamental capacity of the space industry will be strengthened. Regulations on managing satellite frequency, orbit resources and the BDS will be formulated. Guidelines for the development of the commercial space industry will be issued to promote the law-based governance of the space industry. China will build a high-level team of aerospace professionals and step up its efforts to become a world center for talent and innovation in space science. We will also carry out education campaigns to popularize space knowledge and culture, promote the spirit embodied in the development of China's space industry, and create a favorable environment for the whole society to develop an interest in science, to explore the unknown, and to be bold in blazing new trails.
Fifth, we will broaden and deepen international cooperation. China actively participates in the global governance of outer space and provides Chinese solutions to areas such as near-earth objects monitoring and response, planet protection, and space traffic management. In addition, China will work with other countries, international organizations, and partners to build an international research station on the moon, implement the cooperation agreements for the BRICS Remote-Sensing Satellite Constellation, and promote the global application of space information services. More extensive and diversified international mutually beneficial cooperation will also be carried out in lunar exploration, space station, planetary exploration, and the BDS.
Exploration and utilization of outer space for peaceful purposes is the shared dream of all humanity. When we look up at the stars, we are in the meantime making unremitting efforts to explore the space. As long as we join hands, we will make steady progress in space exploration. China is ready to work with the international community to accelerate the development of a high-quality and sustainable space industry that can improve people's wellbeing. In this way, China will also make new pioneering contributions to promoting the building of a community with a shared future for mankind and advancing the progress of human civilization and peaceful development.
Thank you. Now, my colleagues and I would like to answer your questions.
_ueditor_page_break_tag_Xing Huina:
Thank you for your introduction, Mr. Wu. Everyone is already very enthusiastic about raising their hands for questions.
China Media Group:
Mr. Wu, we can see China's achievements in the space sector from your briefing just now, and everyone sees it. What are the anticipated highlights of China's space sector in the future, especially during the 14th Five-Year Plan period (2021-2025)? Thank you.
Wu Yanhua:
Thank you for your question. China made many shining and fruitful achievements in the space sector during the 13th Five-Year Plan period (2016-2020), yet the tasks in the 14th Five-Year Plan are particularly challenging. Simply put, they fall into the following categories.
First, we will complete and continue the operations of the major national projects launched 10 years ago, such as the manned spaceflight project, the Beidou project, and the high-resolution Earth observation system, which also includes making good use of the scientific research data, lunar soil and other samples collected from the three-step lunar exploration program of orbiting, landing, and return for scientific analysis.
Second, according to the national plan, China will launch a number of major space projects, including the fourth phase of the lunar exploration program and the planetary exploration program. We will also verify a number of major projects, such as heavy-lift launch vehicles, and implement them after approval.
Third, we will integrate and coordinate the development of space technologies and space applications, especially the construction of space infrastructure, including three types of satellites (communications, navigation, and remote-sensing). We will develop sound space infrastructure and promote the application of satellites so that they can serve the economic and social development extensively at home and the whole world.
Fourth, we will make overall plans for research on space science and launch a number of satellites for scientific verification. At the same time, we will make good use of the space station, lunar exploration, planetary exploration, and other platforms to carry out in-depth scientific research and strive for original scientific discoveries that contribute to humankind.
The last point is to further deepen the open cooperation with international peers in both major projects and other aspects like satellite research and development, satellite applications, space science, and education through the cultivation of university, middle school, and primary school students. We welcome multimodal, in-depth, and multi-dimensional cooperation among all of our international peers with China's space sector. Thank you.
_ueditor_page_break_tag_CNR:
We know from the introduction just now that China has made many important achievements in the space sector in the past five years. Could you please provide a brief review? Besides, what are the key development directions for the future? Thank you.
Liu Jizhong:
Let me take your questions. Over the past five years, China has boosted the development of space science through its lunar exploration program, the Tianwen-1 Mars probe and space science programs like the Wukong and Mozi satellites. It covers the following aspects: First, from the perspective of evolutionary history, we have gained a new understanding of the evolution of the moon, especially in geological terms, by studying the moon's subsurface structure. Based on the analysis and research of lunar samples collected during the Chang'e-5 mission, we deduced that the geological activities of the moon date back to 2 billion years ago, which was previously thought to be 3 billion years ago. It means the moon is approximately 1 billion years younger. These understandings of the moon, including those of the evolution of the lunar landscape, are of crucial significance. Second, from the perspective of matter and energy, we discovered new types of lunar matter of deep-seated origin through preliminary studies and the relatively precise fine structure in the cosmic-ray energy spectrum. Third, from the perspective of the space environment, through several years of scientific research, we have a new understanding of the radiation of lunar particles and obtained new numerical values. We discovered the lunar micromagnetosphere, and established a new model and rationale for the interaction between solar wind and the moon. At the same time, we have gained a new understanding of the evolution of the Earth's plasma layer activities through the observation of the Earth from space.
Indeed, we have scored many scientific achievements as well. Meanwhile, we have established a batch of facilities for scientific research, which lays a solid foundation for future scientific research and cooperation with international peers. The implementation of these projects has further promoted scientific research. According to statistics, more than 100 colleges have set up disciplines related to space science and enrolled plenty of international students. These serve as a sound foundation for building a talent base for future space science research, which is crucial.
Scientific progress is of paramount importance to the development of human civilization. Hence, China will not cease its deep space exploration. We will focus on issues including the universe, the solar system and development of its planets, and the influence of solar activity on earth. We will roll out tasks like the fourth phase of the lunar exploration program, the planetary exploration program, space station operations, and follow-up special satellite missions such as space astronomy and space physics exploration. By carrying out these tasks and cooperating with other countries, we will bolster the development of both space science and humanity. Thank you.
_ueditor_page_break_tag_Southern Metropolis Daily:
We all know that the development of China's space industry relies on the support of innovative scientists, engineers and technicians. What measures does the CNSA take to foster and attract such talents?
Xu Hongliang:
Thank you for your question. Through its development of more than six decades, China's space industry has made remarkable achievements, formed spirits that are profound and broad, and fostered many extraordinary talents in particular. We have always put focus on standards of selecting and appointing professionals. The standards cover political conviction, moral conduct, ability, style, and honesty. As a result, we have fostered and cultivated a space talent team who stand firm in their ideals and convictions with strong patriotic enthusiasm, a great sense of responsibility, and a good mental outlook. For example, the average ages of the Chang'e team, Tianwen team, Shenzhou team, and BeiDou team are 30 to 40. The development of any cause is impossible without talent, so the development of the space industry needs new blood. At a central conference on talent-related work at the end of 2021, General Secretary Xi Jinping called on efforts to "implement the strategy on developing a quality workforce in the new era." The space industry has followed his great call and formulated relevant plans and incentive policies.
We have taken a series of measures in talent cultivation. First, through implementing the country's major projects, we have enhanced the cultivation of strategic scientists, top sci-tech leaders, young sci-tech talent, innovative teams, and national craftsmen. Second, we have strengthened the mechanism of talent exchange to standardize and guide its development. Third, we have intensified incentive mechanisms. With the economic and social development, the national support for technological talent has scaled up. For instance, some social organizations and enterprises have established individual awards, including the Qian Xuesen Top Achievement Award and the Space Contribution Award, which effectively play an incentive role. Fourth, we have strengthened discipline building and talent reserve cultivation. As Mr. Liu introduced just now, we have carried out discipline construction on space science and fostered talent for China's space industry through the joint building of colleges and disciplines. Fifth, we have extensively carried out international exchanges and cooperation and cultivated talent for some developing countries particularly. For instance, we have responded to the calls of the United Nations and established a regional center on space education to foster space talent for developing countries and facilitate their development. Thank you.
_ueditor_page_break_tag_Phoenix Satellite Television:
Last October, China successfully sent solar exploration satellite Xihe into space, marking a new era of solar exploration. How has the data feedback from Xihe been, and what does the future of China hold in this field? Thank you.
Zhao Jian:
Thank you for your questions. First of all, I'd like to begin by briefly introducing Xihe—China's first solar exploration science and technology experimental satellite. It was sent successfully into space from the Taiyuan Satellite Launch Center on Oct. 14, 2021. This significant accomplishment marks China's transition into a new era of solar exploration. General Secretary Xi Jinping referred to the Xihe satellite chasing the Sun in his 2022 New Year Address, bringing the satellite greater attention.
After more than three months of in-orbit tests and experiments, the satellite has completed more than 40 technical verifications and imaged the sun more than 290 times. The satellite platform and loads continue to operate normally and stably, and its functions and performance meet general development requirements. The satellite will continue its in-orbit scientific experiments during the Spring Festival holidays.
A slew of technological and scientific progress achieved by the satellite will be officially released later this year by CNSA, and I'd like to briefly introduce some of the major achievements here:
First, it demonstrated, in orbit, the ultra-high pointing accuracy and stabilizing technology of a new kind of satellite platform with high accuracy. Compared to traditional platforms with equal inertia, the pointing and stabilizing accuracies of Xihe are two-fold.
Second, it has captured the solar Hα spectral line in orbit, which was the first time the world has seen full-disk images of the Sun in the Hα spectrum. What is the solar Hα spectral line? It occurs when the interaction between photons and hydrogen atoms brings electrons' energy-level transition. As the brightest spectral line responding to the solar eruptions, it can directly reflect the characteristics of solar eruptions. Previously, the solar Hα spectral line could only be detected on Earth, but the data were discontinuous and unstable due to the atmospheric disturbance. Based on the satellite's high-resolution observation and imaging of the sun, scientists can more accurately obtain the temperature and velocity changes in the solar atmosphere during solar eruptions, set up a complete physical mode of energy accumulation, release and transmit from photosphere to corona, and provide key data for studying the dynamic process and the physical mechanism of solar eruptions, which could be expected to become a scientific achievement with international iinfluence.
With solar exploration satellite Xihe into space, the lunar samples brought back by the Chang'e-5 mission, and Tianwen-1's landing and exploration of Mars, we have formed a deep-space exploration trio in one year, covering the solar system's planets and star and contributing wisdom and strength to constructing our country as a major power in space. Referring to the plan for the future solar system exploration, scientists are conducting demonstration studies, helping us further understand the structure, characteristics, mechanism, and laws of solar system to better forecast the space weather and benefit human beings. Thanks.
_ueditor_page_break_tag_Beijing Youth Daily:
This white paper is the fifth of its kind published by the Chinese government on the space program. What are the characteristics and highlights of the "China's Space Program: A 2021 Perspective" compared with previous ones? Thank you.
Xu Hongliang:
Thanks for your question. As you mentioned, this is the fifth white paper on China's space program. Structurally, the white paper, with the mainline of building China into a space power, systematically introduces the mission, principles, policies, measures, and ideas of international cooperation on a new journey towards a space power. Consisting of 11 aspects, the white paper summarizes our achievements in space science, space technologies, and space applications over the past five years. Furthermore, it outlines the future development in the next five years. Specifically speaking, it has three characteristics.
First, it fully embodies the concept of high-quality development. The Chinese government has been committed to modernizing space governance. We have been proactive in formulating relevant policies and measures, given full play to a well-functioning government and an efficient market, and created a favorable environment for the growth of the high-quality space industry. In terms of innovation-driven development, we will strengthen original innovation and optimize the environment for innovation by implementing major space programs. In terms of basic capabilities, we will continue to improve its integrated and open industrial system comprising system integrators, specialized contractors, market suppliers, and public service providers, optimize the industrial structure, and further integrate industrialization with information technology. In terms of the development model, we will encourage and support the development of commercial space enterprises, optimize the distribution of the space industry in the national industrial chain, and accelerate the cost-efficient development of space. In terms of governance capacity, we will speed up the formulation of a national space law and work out relevant policies and regulations to promote law-based governance. In terms of talent cultivation, we will implement the guiding principles of the central conference on talent-related work, improve the mechanism for talent cultivation, exchange, and reward, and strengthen the foundation for talent development. In terms of cultural development, we will promote space education, communication, culture, and spirit embodied in space development in order to increase scientific knowledge among the general public.
Second, it serves the country's primary strategic needs. We all know that building a safe, healthy, beautiful, and digital China has become an essential part of China's socialist modernization. China's space industry has always supported national strategic development and continued to improve its efficiency. On the one hand, we will intensify the integration of satellite applications with the development of industries and regions, space information with information technology such as big data, cloud computing, and the Internet of Things, and boost public services with satellites. On the other hand, we will expand the application and transfer of space technology and provide more convenient and high-quality services for all industries and sectors, and the public. We will also expand China's space economy to make a significant contribution to building China's strengths in science and technology, transport, manufacturing, and cyberspace.
Third, it demonstrates a positive attitude of openness and cooperation. For the first time, the white paper proposes that we will build a community with a shared future for mankind in utilizing outer space and be more open and active in engaging in extensive international exchanges and cooperation. First, besides international onboard payload cooperation, we will expand cooperation on mission planning. Second, collaboration will be upgraded from a single product to joint development of complex systems. Third, the application will be expanded from a typical scenario to a comprehensive application in multiple fields. By doing these, space activities can better benefit humanity and promote the progress of human civilization.
That's my answer. Thank you.
Wu Yanhua:
Mr. Xu has already given a very detailed answer. I would just like to add a few points. First, our major space projects are at a juncture between two stages. First, China has developed a long-term plan for its space program. Just now, I introduced the last group of major projects, which were launched 15 years ago and have entered the phases of completion, operation, and application. The Chinese government is planning new major projects and tasks for the next 15 years. Second, as stated in the white paper, China will integrate space science, technology, and applications. In the past, China paid greater attention to space technology. In the new era, we will emphasize advancing technological innovation through space applications and new discoveries in space science to promote sustainable development. Third, we will be more open to international cooperation and collaboration with international partners and counterparts at a higher level and larger projects. For example, as I said, China and Russia will jointly launch an international lunar research station project. It will be an extensive and long-lasting international scientific cooperation project. We welcome the participation of all the countries, international organizations, scientists, and engineers interested in the project. Thanks.
_ueditor_page_break_tag_Xinhua News Agency:
We know that space development requires high investment. How do you view the investment? How does China's space industry serve its economic and social development and help improve the people's well-being? Thanks.
Zhao Jian:
Thank you for your questions. Space development is the common cause of mankind. On the first China Space Day, General Secretary Xi Jinping said, "To explore the vast cosmos, develop the space industry and build China into a space power is a dream we pursue unremittingly." The space industry reflects a country's overall development of science and technology. In developing the space industry, we must "attain to the broad and great while addressing the delicate and minute." We need to promote the leap-frog development of space science and space technology and transform the achievements of scientific and technological innovation into the forces driving economic and social development.
First, China attaches great importance to space development, and the Chinese people have provided strong support. Space development indeed requires high investment. However, space development and applications can yield substantial benefits. According to preliminary statistics, the input-output ratio of the space industry can exceed 1:10. The application of new space technology has brought about tremendous changes in industrial development. The transformation and applications of space technology serve as strong forces driving economic growth and the development of smart transportation, new energy, new materials, etc. They also play an essential role in supporting the building of a moderately prosperous society in all respects. Therefore, the high investment in the space industry can produce a high output, and the overall benefit is considerable.
Second, aerospace applications have been widely used in various economic and social fields, such as land and resources surveys, environmental protection, agricultural development, forests and grasslands monitoring, disaster prevention and mitigation, weather forecasting, marine development, transportation, education, medical care, and urban and rural construction. In addition, the derived applications of new technologies from aerospace applications have also entered thousands of households. Ordinary people can also experience and feel the improvements to life created by aerospace technologies. For example, communication and broadcasting satellites can provide people with global mobile communications, live radio and television broadcasts, and high-speed broadband internet access, which greatly helped facilitate people's digital lives in the information age; satellite navigation positioning has become an indispensable assistant in people's daily lives, which has greatly facilitated people's transportation and travel and changed people's means of work and lifestyle. Meanwhile, meteorological satellites can provide accurate weather forecasts around the world and in specific regions and provide weather guarantees for people's clothing, food, housing, and transportation.
As another example, satellites are more effective for disaster prevention and mitigation. The high-definition nephograms of typhoon observations produced by high-resolution satellites can clearly observe the structure of a typhoon eye and the pattern of movement and changes, and there were no omissions for typhoons occurred throughout the year around the world. This greatly reduces the cost of disaster prevention and mitigation, and the economic and social benefits are significant. In addition, high-resolution satellites have also played a very important role in preventing forest fires and responding to floods. Recently, a volcanic eruption occurred in Tonga. The CNSA launched the Earth Observation System in an emergency capacity, mobilized more than a dozen satellites to conduct high-frequency observations, and provided relevant imagery data to international organizations in a timely manner.
Third, the development of the aerospace sector not only promotes the rapid formation of the aerospace industry chain but also empowers traditional industries, promoting industrial upgrading and improving quality and efficiency. The aerospace industry is a highly complex and large-scale aggregation, which will help vigorously promote the development of the entire industry chain. It is the same everywhere from a global perspective. A solidly founded aerospace industry is becoming fertile ground for commercial aerospace development, a highland for talents from multiple fields, and a bridgehead for new technology integration and innovation. At present, aerospace technologies are increasingly playing a role in driving growth of related industries, as the result, the latter are showing a great development momentum, and a pattern of intensive, explosive growth of industrial applications has gradually formed. New development patterns have been shaped: centrally-administered state-owned enterprises driving the development of local areas, local governments encouraging characteristic enterprises to gather and develop, and advantageous private capital participating in specialized investment. Through commercial development, these will form a synergy with government investment to further improve the efficiency of aerospace development.
We believe that aerospace development will continuously improve people's wellbeing and vigorously promote the realization of the United Nations' Sustainable Development Goals. The further development and utilization of aerospace technologies will also help us jointly guard this blue planet and benefit the people. Thank you!
_ueditor_page_break_tag_Cover News:
We have learned that China has approved the fourth phase of its lunar exploration program, including the Chang'e-6, Chang'e-7, and Chang'e-8 missions. These three missions will be launched over the next ten years. Could you brief us on the specific arrangements? How important are these missions? Thank you.
Liu Jizhong:
Thank you. China's lunar exploration program was first launched in 2004. As of 2020, when Chang'e-5 brought lunar samples back to Earth, we have completed the first three phases of the program, which were "orbiting, landing, and returning." Based on scientific principles, we have kicked off the research work on the follow-up missions of the lunar exploration program during the 13th Five-Year Plan period (2016-2020). The fourth phase consists of four missions as planned.
The first mission was the Chang'e-4 probe, which, as we know, landed on the far side of the moon and was successfully completed. There will be another three follow-up missions. The Chang'e-6 lunar probe is expected to collect samples in more valuable areas of the moon and return home. Therefore, new lunar soil and samples will be brought back to the Earth. The Chang'e-7 probe is expected to conduct scientific exploration in the moon's polar regions and give us data on the water distribution of the moon. Finally, the Chang'e-8 probe will continue to explore the polar regions and test core technologies concerning the follow-up work of the research station.
Our fundamental goal throughout the four phases of the lunar exploration program is to establish a basic model for the research station and lay the foundation for us to cooperate with other countries in establishing the ILRS. We have been in close contact with our peers around the world and will jointly conduct exploration work regarding these missions. For example, a deal agreed with Russia means that the Chang'e-7 mission will conduct joint exploration with Russia's "lunar-26" project. Based on our current R&D progress, all work involved in the Chang'e-6 and Chang'e-7 missions will be completed in 2025. The R&D of the Chang'e-8 mission will kick off in the same year, and the probe will be launched by 2030. To conclude, we are set to achieve the expected results of the fourth phase of the lunar exploration program by 2030. Thank you.
_ueditor_page_break_tag_Xing Huina:
Due to time constraints, we will have one last question.
Global Times:
Just now, Mr. Wu and Mr. Liu mentioned the ILRS project jointly launched by China and Russia. Could you further elaborate on this project? Also, how will the follow-up work be carried out? Thank you.
Wu Yanhua:
Thank you. It was reported that in March 2021, the Chinese and Russian governments signed a memorandum of understanding on the cooperation of the ILRS. In April, China and Russia's aerospace authorities issued a joint statement. In June, the two sides jointly released a roadmap and a guide for the ILRS, inviting all interested countries, international organizations, and partners to cooperate in the project. Just now, Mr. Liu introduced that the ILRS was proposed in 2016, and many countries around the world are also responding to it. In general, like the Antarctic and Arctic research stations, we tend to build a scientific experiment base at the lunar south pole in the future and build scientific research facilities in lunar orbit and on the lunar surface that can carry out multi-disciplinary and multi-objective scientific research activities.
First, China and Russia launched the ILRS based on their respective lunar exploration plans. The goal of the fourth phase for the Chinese lunar exploration program is to build a basic model of an international lunar scientific research station. We will use the next five years to conduct exploration before setting up a lunar research station, which are the objectives of China's Chang'e-6 and Chang'e-7 missions. Russia has other relevant arrangements. It will take us another 10 years or so to complete the construction of facilities. Like building a small town, a lunar research station must be equipped with energy, communication, navigation, long-distance transportation, lunar-earth round-trip capabilities, and ground support systems. There must also be a life support system if there are to be people in the station in the future. China and Russia also welcome the participation of international counterparts. I think these systems are future-oriented, which means that our plans for 2035 will focus on these tasks. After 2035, various countries and organizations will conduct scientific expeditions on the moon in stages according to their plans.
Second, China and Russia will sign an intergovernmental agreement. We have been negotiating in full swing and reached a consensus, which is expected to be signed as soon as possible this year. The Chinese and Russian space authorities will officially release the declaration on constructing an international lunar research station and publish the construction principles and purposes to the international community. Generally speaking, at all stages, at all levels of construction, including systems, sub-systems, and facilities, and in terms of sharing research data and space-ground support system, we have set no limits and welcome the world to join in its construction. The missions led by China and Russia are also open to cooperation, providing opportunities for other countries to participate and share scientific research data.
That's all for my answer to this question. Thank you.
Xing Huina:
Due to time constraints, today's press conference is concluded here. Thanks to all speakers and journalists.
Wu Yanhua:
Thank you, friends from the media, for your concern, encouragement, and support for China's aerospace industry, as well as your promotion of aerospace knowledge. Thank you all!
Translated and edited by Xu Xiaoxuan, Zhang Liying, He Shan, Zhou Jing, Zhang Jiaqi, Chen Xia, Liu Jianing, Wang Wei, Wang Yanfang, Li Huiru, Liu Qiang, Zhang Rui, Liu Sitong, Zhu Bochen, Yang Xi, Wang Yiming, Lin Liyao, Zhang Junmian, Jay Birbeck, and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Guo Tingting, director general of the Comprehensive Department of the Ministry of Commerce (MOFCOM)
Xu Xingfeng, person in charge of the Department of Market Operation and Consumption Promotion of the MOFCOM
Li Xingqian, director general of the Department of Foreign Trade of the MOFCOM
Chen Chunjiang, director general of the Department of Foreign Investment Administration of the MOFCOM
Chairperson:
Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and SCIO spokesperson
Date:
Jan. 25, 2022
_ueditor_page_break_tag_Xing Huina:
Friends from the media, good morning! Welcome to this press conference held by the State Council Information Office (SCIO). Today, we will introduce China's commerce development in 2021 and answer your questions. We are joined by Ms. Guo Tingting, director general of the Comprehensive Department of the Ministry of Commerce (MOFCOM), Mr. Xu Xingfeng, person in charge of the Department of Market Operation and Consumption Promotion of the MOFCOM, Mr. Li Xingqian, director general of the Department of Foreign Trade of the MOFCOM, and Mr. Chen Chunjiang, director general of the Department of Foreign Investment Administration of the MOFCOM.
Now, let's give the floor to Ms. Guo.
Guo Tingting:
Thank you. Friends from the media, good morning! Welcome to today's press conference, and thank you for your attention and concern for commerce development. Today marks the traditional Chinese Xiaonian Festival, a week before the Lunar New Year. Here, I wish everyone a happy Chinese New Year of the Tiger in advance! Next, I will introduce the general situation of commerce development.
Since the 18th National Congress of the Communist Party of China (CPC), guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the MOFCOM has resolutely implemented the decisions and arrangements of the CPC Central Committee and the State Council, promoted the building of a strong domestic market, advanced high-level opening up, and actively participated in global economic governance. By doing so, China has made new breakthroughs in commercial development. China has become the world's second-largest consumer economy. It has ranked first in trade in goods globally for five consecutive years. China is also the world's second-largest foreign direct investment destination, and its outbound direct investment ranks among the world's top. In addition, the country has established 21 free trade pilot zones, promoted the construction of the Hainan Free Trade Port, and signed the Regional Comprehensive Economic Partnership (RCEP), the world's largest free trade agreement (FTA).
In 2021, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the MOFCOM resolutely implemented the spirit of the 19th CPC National Congress and the plenary sessions of the 19th CPC Central Committee and followed the deployment of the Central Economic Work Conference and the government work report. We fully and faithfully applied the new development philosophy and promoted the fostering of a new pattern of development. We consolidated the gains in the fight against COVID-19 and social development achievements. The positioning of commerce work can be summarized in three important aspects: commerce as an important part of domestic circulation, commerce as an important link between domestic and international circulations, and commerce's important role in building a new development paradigm. With our focus on positioning in the above three important aspects, we carried out a portfolio of "5+5" key tasks. As a result, the commercial operation had a stable, sound, and better-than-expected performance. Foreign trade, foreign investment, consumption volume, and the proportion of investment in countries along the Belt and Road Initiative hit an all-time high. Furthermore, major breakthroughs were made in multilateral and bilateral cooperation. All this has put the implementation of the 14th Five-Year Plan off to a good start and made a positive contribution to the sustained recovery of the national economy.
First, domestic consumption gradually rebounded. Total annual retail sales of consumer goods rose 12.5% to 44.1 trillion yuan. Consumption has re-established itself as the key driver of economic development, accounting for 65.4% of total expenditure. First, urban and rural markets achieved recovery simultaneously. The retail sales of consumer goods in urban and rural areas increased by 12.5% and 12.1%, respectively. Second, the consumption of upgraded commodities increased significantly. The retail sales of commodities increased by 11.8%. Gold, silver, and other jewelry, sports and entertainment supplies, and cultural and office supplies of units above designated size increased by 29.8%, 22%, and 18.8%, respectively. Sales of new energy vehicles increased by 1.6 times. Third, spending on catering and other services saw an orderly recovery, with catering income rising by 18.6% from a year ago, close to the pre-epidemic level. The per capita education, culture and entertainment consumption, transportation and communication consumption, and health care consumption increased by 27.9%, 14.3%, and 14.8%, respectively. Fourth, new consumption models were further developed. China's online sales of physical goods expanded by 12% year on year to 10.8 trillion yuan in 2021, accounting for 24.5% of the total retail sales during the period. The "Online Chinese New Year Shopping Festival" and "Brand and Quality Online Shopping Festival" drove online retail sales of 1.6 trillion yuan. Offshore duty-free sales in south China's island province of Hainan increased by 83.1%.
Second, foreign trade moved up another notch. The total imports and exports of goods expanded 21.4% year on year to 39.1 trillion yuan. Exports rose 21.2%, while imports went up 21.5%, which were highlights of economic operation. First, the scale and share of foreign trade rose higher. Its volume exceeded the $5 trillion and $6 trillion thresholds over the year. The international market shares of exports and imports in the first three quarters were 15% and 12.1%, respectively, hitting record highs. Second, the vitality of the leading market players continued to increase. The number of enterprises involved in exports and imports increased by 36,000 to 567,000. The imports and exports of China's private sector registered an increase of 26.7%, accounting for 48.6% of the country's total foreign trade volume, 2 percentage points higher than the previous year. Third, the imports and exports to major trading partners maintained relatively rapid growth. Imports and exports to ASEAN, the European Union, and the United States increased by 19.7%, 19.1%, and 20.2%, respectively. Fourth, the commodity structure was further optimized. The exports of high-tech and high value-added products increased rapidly. The exports of machinery and electronic products increased by 20.4%, and the volume of new energy vehicles exports increased by 3 times. Fifth, the service trade saw faster upgrades, rising 14.7% year on year to reach 4.7 trillion yuan in the first 11 months of the year. The exports of culture and entertainment and intellectual property royalties, which are knowledge-intensive services, increased by 36.2% and 29.3%, respectively.
Third, absorption of foreign investment increased quickly. The whole year saw the actual use of foreign investment surpass 1 trillion yuan, which was its first time to reach 1.1 trillion yuan, realizing a growth of 14.9%. Newly-established foreign-funded enterprises totaled 48,000, up 23.5%. The quantity and quality of foreign investment both improved. Firstly, the structure of foreign investment continued to optimize. High-tech industries saw a 17.1% increase in foreign investment, bringing the share of the total to 30.2%. In high-tech manufacturing, the growth of foreign investment was 200% in manufacturing of equipment for electronic products manufacturing and 64.9% in general instruments and meters manufacturing. In high-tech services, the growth of foreign investment was 220% in e-commerce services and 25% in services for commercialization of scientific and research findings. Secondly, investments from major sources grew stably. Those from countries along the Belt and Road increased 29.4%. Those from Singapore and Germany grew 29.7% and 16.4%, respectively. Thirdly, the number of large projects grew quickly. The number of projects with contractual foreign investment of $50 million or more each grew 26.1%, and that with contractual foreign investment of $100 million or more grew 25.5%. Fourthly, highlands for opening-up saw remarkable results. A total of 21 pilot free trade zones (FTZs) actually utilized 213 billion yuan of foreign investment, taking up an 18.5% share of the total foreign investment.
Fourth, steady development was seen in the implementation of outward investment and cooperation and in the process of providing foreign aid. In the whole year, our direct outward investment reached 936.7 billion yuan, up 2.2%, with further structural improvements. Firstly, investment and cooperation continued to deepen in key regions such as those along the Belt and Road. Investment in BRI countries grew 7.9%, bringing the share of the total to 14.8%. Investment in the EU grew 13.4%. Secondly, fast growth was seen in investment in key industries. The investment in transportation, services for scientific research, and information technology grew 80%, 68.5%, and 5%, respectively, with the combined share of the three industries up by 3.1 percentage points. Thirdly, win-win results were achieved through cooperation. As of the end of 2021, the accumulated investment in overseas economic and trade cooperation zones stood at $50.7 billion, with a total of $6.6 billion of taxes being paid to host countries and 392,000 jobs being created locally. Fourthly, contracted projects were stable and growing. In U.S. dollar terms, the contractual value of newly-signed contracts grew 1.2%. The number of newly-signed contracts with a worth of at least $100 million each increased by 46. Fifthly, our foreign aid was carried out with high efficiency. We fully implemented the major measures regarding foreign aid announced by President Xi Jinping, and carried out more than 1,000 foreign aid projects throughout the year. We also carried out vaccine-related foreign aid to 107 countries and four international organizations with high efficiency.
Fifth, multilateral and bilateral economic and trade relations saw new breakthroughs. Firstly, the strategy for boosting FTZs saw major progress. We made efforts for the RCEP to be enacted and implemented as scheduled. We formally applied for the membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Digital Economy Partnership Agreement (DEPA). We signed a protocol on upgrading our FTA with New Zealand and gained positive progress in negotiations for upgrading FTAs with South Korea and Singapore. Secondly, multilateral cooperation exerted a bigger role. We hosted the High-Level Session on the 20th Anniversary of China's Accession to the World Trade Organization (WTO) and thematic exhibitions. We completed the eighth review of the WTO on China's trade policies. We proactively participated in WTO negotiations regarding relative issues. We deepened cooperation regarding digital economy and supply chains and promoted inclusive policies in trade and investment under the mechanisms of the United Nations, Group of 20, the Asia-Pacific Economic Cooperation, the BRICS countries, and the Shanghai Cooperation Organization. Thirdly, bilateral and regional economic and trade cooperation further deepened. Remarkable results were achieved through the economic and trade cooperation between provincial-level regions in China and various states in the U.S. Trade between China and Russia reached new heights. We pushed for China and Singapore to develop the New International Land-Sea Trade Corridor together. We contrived practical measures for the eighth ministerial conference of the Forum on China-Africa Cooperation. We hosted the China-CEEC Expo.
Also, we made solid efforts for epidemic prevention and control and ensured the supply of daily necessities. We compiled the plan for commercial development, the plan for high-quality development of foreign trade, and five special-purpose plans for the 14th Five-Year Plan period (2021-2025).
In 2022, the Ministry of Commerce will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, implement the principles of the 19th National Congress of the Communist Party of China (CPC) and all plenary sessions of the 19th Party Central Committee in full. We will act on the principles of the Central Economic Work Conference, and carry forward the great founding spirit of the Party. We will prioritize stability while seeking progress, apply the new development philosophy completely, accurately and thoroughly, and facilitate the construction of the new development paradigm. We will advance supply-side structural reform as the main task, ensure stability on six key fronts and maintain security in six key areas, and play the three important roles of commerce-related work. We will carry out Covid-19 prevention and control and pursue commerce development in a coordinated way, ensure coordination in pursuing development and upholding security, push for the continued recovery of consumption, stabilize the fundamentals of foreign trade and foreign investment, ramp up efforts in high-level opening-up, keep commerce-related situations running within an appropriate range, and push for the high-quality development of commerce. We will better serve the big picture of socioeconomic development and welcome the successful convening of the 20th National Congress of the CPC with outstanding performances.
Thank you all!
_ueditor_page_break_tag_Xing Huina:
Thanks for Mr. Guo's introduction. Now we start taking questions. Please state the news outlet you work for before raising questions.
CCTV:
What achievements did the MOFCOM make in promoting economic and trade cooperation under the Belt and Road Initiative (BRI) in 2021? What is the MOFCOM's work plan this year? Thank you.
Guo Tingting:
Thank you for your questions. I'll brief you on them. Given the profound changes and the pandemic conditions not seen in a century, China continues to uphold the principle of extensive consultation, joint contribution, and shared benefits, and aims for high-standard, people-centered, and sustainable growth. We have worked with relevant parties to promote the high-quality BRI development through joint efforts. Remarkable achievements have been made, with participating countries enjoying common development and mutual benefit. The joint construction of the Belt and Road has developed into a well-received global public product and a platform for international cooperation.
In 2021, the MOFCOM implemented the decisions and plans of the CPC Central Committee and the State Council, stepped up efforts to promote the economic and trade cooperation under the BRI, and made new contributions to the high-quality BRI development.
First, Unimpeded trade saw new progress. In 2021, total trade of goods between China and countries along the Belt and Road reached 11.6 trillion yuan, marking a new record in eight years. It registered a year-on-year increase of 23.6% and accounted for 29.7% of China's total foreign trade. Cross-border e-commerce and other new business forms developed rapidly. A lot of overseas warehouses were built and put into use. The first overseas smart logistics platform (https://ols.zjmade.cn:18084/consumer/home) was launched to match supply and demand on overseas warehouses. The number of China-Europe freight train trips surged by 22% year on year to 15,000, and a total of 1.46 million twenty-foot equivalent units of goods were handled, up 29% year on year. The New International Land-Sea Trade Corridor witnessed rapid progress. China and Singapore signed a cooperation plan, and jointly held the 2021 CCI-ILSTC International Cooperation Forum.
Second, new progress was made in investment cooperation. Direct investment to countries along the Belt and Road grew 7.9% year on year to 138.45 billion yuan in 2021, accounting for 14.8% of total outbound investment. Companies from countries along the Belt and Road have been optimistic about development opportunities in China. As such, their direct investment reached $11.25 billion (around 74.28 billion yuan), surpassing the threshold of $10 billion for the first time. Steady progress has been made in the construction of BRI projects. The accomplished turnover of contracted projects in countries along the Belt and Road totaled 578.57 billion yuan, accounting for 57.9% of the country's total. The assistance programs in poverty alleviation, healthcare, education, sports, and other areas related to people's livelihood proved to be effective, and the construction of the China-aided future headquarters of the Africa Centers for Disease Control and Prevention went smoothly.
Third, mechanisms and platforms were well improved. We established with relevant countries eight unimpeded trade working groups and investment and economic cooperation working groups. We signed a Memorandum of Understanding (MoU) with Senegal on e-commerce cooperation, and signed MoUs with Hungary and Russia to enhance cooperation in green development and digital economy. The cooperation mechanisms, thereby, have been improved and more channels have been established to ensure better communication. Moreover, we held successfully a series of exhibitions last year, including the China International Import Expo (CIIE), the China Import and Export Fair (also known as the Canton Fair), the China International Fair for Trade in Services (CIFTIS), the China-ASEAN Expo, and the China-Africa Economic and Trade Expo, which have promoted economic and trade cooperation with relevant countries.
In November 2021, General Secretary Xi Jinping delivered an important speech at the third symposium on the Belt and Road Initiative, charting the course and providing the fundamental guiding principles for promoting the BRI through joint efforts in the new era. In 2022, the MOFCOM will implement the spirit of the important speech made by General Secretary Xi Jinping and take the economic and trade cooperation under the BRI as the priority. We will continue to reinforce the fundamentals of the cooperation and steadily expand new cooperation areas. We will ramp up efforts to build the iconic BRI projects and strengthen risk prevention and control so as to promote the high-quality development of the BRI throughout joint efforts and better serve the building of the new development paradigm. Thank you.
_ueditor_page_break_tag_Phoenix TV:
My question is about consumption. As we know, in 2021, the total retail sales of consumer goods grew 12.5% year on year. How does the MOFCOM evaluate the recovery of the consumer market? Are there any features and highlights you'd like to share? Thank you.
Xu Xingfeng:
I'll answer your questions. I'm delighted to meet with the media on China's Little New Year, which falls about a week before the Lunar New Year. Thanks for your attention to the work related to consumption, and I also hope that the media will continue to keep an eye on this field.
Just now, Ms. Guo provided a comprehensive introduction to the operation of China's consumer market in 2021, and I'd like to add more information about it. Last year, in spite of the adverse impact of the epidemic, China's consumer market maintained a steady recovery, showing great vitality and resilience. We have made a good start for the 14th Five-Year Plan. The retail sales of consumer goods totaled 44.1 trillion yuan in 2021, an increase of 12.5% over 2020 and an average increase of 3.9% over the past two years. Throughout the whole year, the features and highlights are mainly reflected in the following four aspects.
First, the innovation-driven features are evident. Various new technologies and concepts have been broadly implemented in the consumption area. New business formats and new models such as curated retail have been rapidly employed. Furthermore, new scenarios like experimental, immersive, and interactive consumption continue to emerge. The integration of business, tourism, and online and offline activities has also been accelerated. Online retail sales reached 13 trillion yuan in 2021, up 14.1% from the previous year.
Second, smart consumption has increased rapidly. The retail sales value of communication equipment by enterprises above the designated size grew by 14.6% over the previous year. The shipment of 5G mobile phones reached 266 million, up 63.5%, which accounted for 76% of total mobile phone shipments in the same period. The sales volume of smart products on many e-commerce platforms, such as smart door locks, smart bathrooms, and floor-sweeping robots, increased by more than 30%.
Third, green consumption is booming. Taking the sales of automobiles as an example, the sales volume of new energy vehicles reached 3.521 million, an increase of 1.6 times over the previous year. It means that, for every 8 vehicles sold, 1 was a new energy vehicle. And the used car transaction volume, which reflects the circular economy, reached 17.585 million units, an increase of 22.6%. And the ratio of used cars sales to new vehicles sales reached 0.67 to 1.
Fourth, ice and snow consumption continued to rise. As we all know, the Beijing Winter Olympics will be held in a couple of days. There has been a boom in ice and snow consumption in different places. While following proper epidemic prevention and control procedures, many places, such as Beijing, Jilin, Heilongjiang, Shanghai, and Hubei, have launched various kinds of ice and snow consumption activities. Meanwhile, the sales volume of ski products on several e-commerce platforms more than doubled.
These are the highlights and features of the consumption. At the same time, it has been noticed that consumption in many regions, industries, and varieties has recovered slowly due to the pandemic and other factors. Micro, small and medium-sized enterprises and self-employed individuals are still confronting difficulties in their operations. As a result, we should still make further efforts to maintain the steady development of consumption.
_ueditor_page_break_tag_China News Service:
In 2021, China hit another record high on its scale of foreign investment. What are the prospects for this year? The Central Economic Work Conference proposed that national treatment should be implemented to foreign-invested enterprises to attract more investment from multinational corporations. What new measures will the Ministry of Commerce take in this regard? Thank you.
Chen Chunjiang:
Thank you for your question; I'll answer it. The world is experiencing the combined impacts of major changes and a pandemic unseen in a century. And the external environment has become more complicated. The work of stabilizing foreign investment still faces significant challenges. The United Nations Conference on Trade and Development (UNCTAD) predicts that it will be difficult to achieve rapid growth on global cross-border investment this year. The restructuring of the international industrial chain has become more nearshore, localized, and regional, and the competition for attracting investment among countries has intensified. In addition, the global epidemic has continuously affected cross-border investment promotion activities. At the same time, domestic enterprises have also been facing the pressure of rising prices for labor, land, and raw materials.
Despite these challenges, we possess the strong leadership of the Central Committee of the Communist Party of China with Comrade Xi Jinping at its core. We have the advantages of the socialist system with Chinese characteristics. We have maintained a leading global position in economic development and Covid-19 response. We also enjoy favorable conditions, such as a complete system of industries, improved infrastructure, and abundant human resources. And there are many super-large markets to attract foreign investment. Therefore, foreign investment in China is generally expected to be good. Reports from major foreign chambers of commerce show that China has still been one of the major investment destinations for multinational corporations. For example, the German Chamber of Commerce in China just released the 'business confidence survey 2021/22' last week. Its results show that German companies in China have confidence in the growth of the Chinese market. And 71% of companies plan to continue to increase investment in China. So, in general, we are confident we will maintain stable foreign investment in 2022.
We will fully implement the principles of the Central Economic Work Conference, adhere to the general principle of pursuing progress while ensuring stability, and focus on 'stabilizing the overall performance of foreign trade and foreign investment.' Also, we will follow the requirements of the National Business Work Conference, focus on maintaining the existing stock, explore increments, and optimize the structure. We will focus our work on the following six areas.
First, we will make continued efforts to open China to the outside world at a higher level. We should fully implement the national negative list and pilot FTZ negative list for foreign investment (2021 Edition) to ensure that the opening-up measures in automobile manufacturing and other sectors are taken effectively to attract more multinational companies to invest in China.
Second, we will ramp up efforts to improve support policies. For example, we have revised the industry catalog to boost foreign investment and fully leveraged the effect of preferential policies such as land and tax policies. This will lead to more foreign investment in sectors like advanced manufacturing, modern services, high and new technology, green and low-carbon and the digital economy, and also in China's central and western regions.
Third, we will continuously improve services. We will improve the mechanism of special working groups for key foreign-funded projects, respond quickly to and solve problems encountered by foreign-funded companies in a timely manner, and provide services to ensure the stable operation of the companies. We will ensure services for key foreign-funded projects in land, energy, environmental protection, and personnel entry and exit so as to promote the early signing, production, and fulfillment of projects.
Fourth, we will continuously leverage the role of platforms. We will make use of open platforms such as pilot FTZs, free trade ports, and comprehensive demonstration zones for expanding opening up in the service sector, align them with high-standard international economic and trade rules, and accelerate institution-based opening-up. We will implement the new assessment and evaluation methods for national economic development zones, vigorously develop an open economy, and make them major platforms for stabilizing foreign trade and foreign investment.
Fifth, we will continuously promote investment. We will run a successful 22nd China International Fair for Investment and Trade, hold various forms of investment promotion activities, and promote foreign-funded projects to communicate in key industries. We will organize multinational companies to go on trips around China so as to better support localities in attracting investment.
Sixth, we will continuously improve the business environment. We will effectively implement the Foreign Investment Law and the regulations for its implementation, and continuously improve supporting rules. We will make full use of the mechanism for handling complaints by foreign-funded companies, better protect the legitimate rights and interests of foreign investors, and ensure the national treatment of foreign-funded enterprises. We will strive to create an even better business environment and make China a popular destination for foreign investment.
That is all I have for it. Thank you.
_ueditor_page_break_tag_Xinhua News Agency:
My question is about foreign trade. China's foreign trade registered a brilliant performance in the past year, but some agencies predict that it will be difficult to sustain a high growth this year. How does the Ministry of Commerce view foreign trade this year? What are your specific plans for stabilizing foreign trade? Thank you.
Li Xingqian:
Thank you. This is also a question of wide attention to all sectors of society. In general, on top of the $6.05 trillion volume and 30% growth rate last year, the foreign trade situation is grim this year, with unprecedented difficulties and pressure in maintaining steady growth.
From the perspective of demand, global external demand growth faces two big uncertainties. First, the pandemic has repeatedly delayed the recovery of the global economy. According to a new U.N. report, the global economic recovery is under great strain due to COVID-19, labor shortages, supply chain disruptions, and rising inflation. Global growth is forecast to slow from 5.5% in 2021 to 4% this year. The WTO expects growth in the volume of global trade in goods to slow from 10.8% in 2021 to 4.7%. Second, global systemic risks are rising as a result of an uneven recovery. Affected by the vaccination gap and policy differences, low-income countries and developed economies see a widening gap of recovery in between, accompanied by depreciating currencies and high inflation. The rapid withdrawal of stimulus policies in some countries may lead to shrinking demand and price fluctuations, which in turn will affect China's export in related industries.
From the perspective of supply, the global industrial chain and supply chain face two major destabilizing factors. First, the accelerated restructuring of the global supply chain and the one-sided pursuit of bringing industries back by developed economies are dividing the market and reducing the efficiency of global resource allocation. Second, disruptions and bottlenecks in the global supply chain can hardly be thoroughly alleviated in the short term. Problems such as high raw material prices, structural imbalances in shipping capacity, and shortages of essential components like chips have persisted. The overall costs of our foreign trade companies, especially small, medium, and micro foreign trade companies, have risen markedly, while their operating risks and burdens remain high. Therefore, the companies feel reluctant to accept orders even if they have orders out there, while they see no profit increase despite a rise in income.
We should face straight up these difficulties and strengthen our confidence. China's foreign trade sector boasts a solid foundation, and the fundamentals sustaining its long-term growth remain unchanged. This year, in terms of foreign trade, we will give top priority to stability and pursue progress while ensuring stability. We will pay more attention to better quality than higher quantity. With the joint efforts of various localities, departments, and foreign trade companies, we are confident that the foreign trade will get off to a good start and remain within a reasonable range throughout the year.
Based on the current situation, we have designated 2022 as a year for foreign trade to consolidate and advance, with a focus on increasing the comprehensive competitiveness of China's foreign trade. We will take four specific actions:
First, we will take cross-cyclical measures to stabilize foreign trade. We will make our policies serve intended purposes and make further use of export credit insurance, manage credit supply in the foreign trade sector well, and enhance the ability of companies to cope with exchange rate risks. We will further step up trade facilitation and effectively help companies overcome difficulties.
Second, we will adopt a diversified market approach. We will give fully play to the role of the unimpeded trade working groups, make better use of the negotiated or signed free-trade agreement and organize major expos, such as China Import and Export Fair, the CIIE and the CIFTIS, so as to help enterprises in reinforcing their traditional markets and expand emerging ones.
Third, we will ensure the smooth supply chains for foreign trade. While cultivating various types of platforms and carriers including national industrial parks for processing and trade, demonstration zones for creative promotion of imports and foreign trade transformation and upgrade bases, we will also continue promoting the streamlined flow of goods, materials and settlements.
Fourth, we will encourage high-quality and innovative-based foreign trade. We will harness the leading role of new business forms such as cross-border e-commerce and overseas warehouses, as well as the role of new models to build leading zones for digitalization of global trade and promote the healthy development of green trade. Thank you.
_ueditor_page_break_tag_Red Star News:
China has absorbed 1,149.36 billion yuan in foreign investment in 2021, realizing a double-digit growth. What are the reasons behind this achievement?
Chen Chunjiang:
Thank you for your question. 2021 saw China's first breakthrough in absorbing foreign investment to exceed one trillion yuan, up 14.9% to reach 1,149.36 billion yuan, which equals $173.48 billion, up 20.2%; the average two-year growth was 12.1% compared with 2019, 6.4 percentage points higher than the global average. We attribute such achievements to the following five reasons:
First, the effect of China's opening-up is gradually emerging. China has been committed to opening its door wider to the world, further shortening the negative list for foreign investment, fully lifting foreign equity caps in the automotive industry and clearing barriers for the manufacturing industry in pilot free-trade zones. We have also ensured that the RCEP came into effect as scheduled, officially applied to join CPTPP and DEPA and continuously released active signals. Therefore, more foreign investors have seen more market opportunities and have intensified their investment in China – with 48,000 new enterprises being established in 2021, up 23.5% year-on-year.
Second, the effect of stabilizing foreign investment is continuously emerging. The MOFCOM has acted with firm resolve to implement requirements made by General Secretary Xi Jinping on stabilizing the overall performance of foreign trade and foreign investment, and promulgated 22 supportive measures on stabilizing foreign investment under new development paradigm in 2021. It has also guided local authorities in issuing more than 140 policies and documents. FDI in eastern, central and western China achieved an all-round growth, increasing by 14.6%, 20.5% and 14.2% respectively, and 20 provinces registered double-digit growth, offering significant support for the stability of foreign investment nationwide.
Third, the driving effects of open platforms are increasingly demonstrated. Investment liberalization and facilitation measures on opening platforms such as free-trade zones, free-trade ports and pilot demonstrations for open services have been released and are attractive investment projects. In 2021, foreign investment rose 19% across 21 pilot free-trade zones, while Hainan Free Trade Port doubled its previous figure in foreign investment. The "1+4" open and comprehensive demonstration zones in service sectors, namely, Beijing, Tianjin, Shanghai, Hainan and Chongqing, account for 33.4% of the national total in foreign investment, exemplifying these high-level opening platforms' strong attraction for foreign investment.
Fourth, efforts in stabilizing market expectations are beginning to show results. A special working group for major foreign projects under the coordination mechanism of foreign trade and investment has strengthened their services for major foreign enterprises, including hosting 75 exchange activities for foreign enterprises, chambers of commerce and associations over the course of the year, guiding local authorities in launching over 1,800 dialogues as well as communicating with more than 40,000 foreign businesses, thus making their policies known to the public and promptly responding to concerns from the enterprises. We have coordinated and resolved more than 1,000 difficulties concerning foreign employees' entry, customs clearance for goods as well as vaccinations for staff members. All these efforts have effectively stabilized the operations of these foreign enterprises. Relevant departments actively released policies and measures targeting some common issues, such as extending preferential individual income tax policies on foreign staff and drafting measures to safeguard foreign businesses' equal access to government procurement. The foreign enterprises had more confidence in market expectations and investments when they truly felt that the Chinese government welcomes foreign investment. A recent survey conducted by the MOFCOM showed that 94.9% of enterprises are optimistic about their future business, among more than 3,000 major foreign companies surveyed.
Fifth, efforts to create a better business environment are paying off. All local authorities and departments have ramped up efforts to sort out laws, regulations, and documents, not in line with the Foreign Investment Law. More than 500 laws, regulations, and documents have been formulated, revised, and repealed. In addition, the MOFCOM has improved the complaint mechanism and related working network for foreign-invested enterprises (FIEs) and helped FIEs coordinate and settle a series of complaint matters, thus protecting the legitimate rights of foreign investment. We continue to foster a business environment based on market principles, governed by law, and up to international standards, to ensure that FIEs can access our market, gain a foothold here and thrive.
We have successfully completed the tasks of ensuring stable foreign investment in 2021. Generally speaking, this progress is the result of the strong leadership of the CPC Central Committee with Comrade Xi Jinping at the core and the joint efforts of all local authorities and all departments. Next, we will firmly implement the arrangements of the CPC Central Committee and the State Council for ensuring stability on the six fronts and maintaining security in the six areas. We will make stability our priority and pursue stable performance while making new progress. Solid measures will be taken to ensure stable foreign investment in 2022, aiming to greet the gathering of the 20th National Congress of the CPC with outstanding achievements.
These are my answers. Thank you!
_ueditor_page_break_tag_Global Times:
There have been sporadic epidemic outbreaks recently. So how does the MOFCOM view China's consumption sector this year? What specific measures will be taken to boost consumption? Thank you.
Xu Xingfeng:
Thank you for your questions. I will answer your questions. Based on a comprehensive assessment, we believe that in general, China's consumption sector will continue to restore development in 2022. Our conclusion is based on three aspects, which are as follows:
First, despite the sporadic epidemic outbreaks, China has taken a more precisely-targeted and science-based approach in policies of regular COVID-19 prevention and control, thus stabilizing consumer expectations.
Second, the middle-income group continues to expand, and residents' income has registered steady growth. In 2021, China's per capita GDP surpassed 12,000 US dollars, and residents' per capita disposable income reached 35,000 yuan, up by 9.1% from the previous year. So, the consumer fundamentals are secure.
Third, the policies and measures on expanding domestic needs and boosting consumption, being put into place and producing positive results gradually, will provide strong support for consumption recovery, meaning the consumption policies are in good shape.
We conclude through the above analysis that in general, China's consumption sector will continue to restore development.
Next, the MOFCOM will fully implement the guiding principles of the 19th National Congress of the CPC and all the plenary sessions of the 19th CPC Central Committee and put into action the arrangements of the Central Economic Work Conference. We will firmly implement the strategy of expanding domestic demand. We will make it our priority to maintain stability and pursue steady progress. We will coordinate the works on COVID-19 prevention and control and boosting consumption. We will work to promote continued recovery and upgrading of consumption, to better serve the building of a new development paradigm. Our works will focus on the following five aspects:
First, we will upgrade the traditional consumption sector. Automobiles, household appliances, furniture and catering, are the four major consumption sectors and the foundational pillars of consumption. To deepen reform on automobiles circulation, we will promote the transformation from the administration of purchase to the administration of use. We will revise the Measures for the Administration of the Circulation of Second-hand Automobiles and other related regulations to expand the circulation of second-hand automobiles. We will promote the consumption of new energy vehicles. We will also encourage household appliance and furniture replacements. Furthermore, we will push for service consumption, such as catering, to restore development.
Second, we will accelerate new types of consumption. New types of consumption are a major driving force to boost consumption. Next, we will support the development of new business forms and models and new scenarios. New types of consumption, such as smart products consumption, tailored products consumption, experience consumption, and fashion consumption, will be developed. When I answered a previous question, I gave an introduction about the characteristics of innovation-driven consumption. And these are the new types of consumption. We will promote the innovative development of time-honored brands to boost brand-based consumption. We will call for a simple, moderate, and low-carbon lifestyle to increase green consumption. We will work to better play the roles of platforms such as the CIIE and the China International Consumer Products Expo and expand the imports of quality consumer goods. These are new types of consumption, brand-based consumption, green consumption, and imports of quality consumer goods.
Third, we will step up upgrading urban consumption. The sheer size of urban consumption makes it take up a large proportion of the consumption sector. Therefore, we will speed up fostering and building international consumption center cities, accelerate the high-quality development of pedestrian streets, and pilot the building of smart shopping districts and smart stores to provide urban residents with more quality service. We will also accelerate the development of a "15-minute community life circle" and improve the community-level business service facilities, to provide urban residents with more convenient services.
Fourth, we will strengthen the weaknesses of rural consumption. The potential of rural consumption is enormous, and the prospects for its development are excellent. Next, we will accelerate the building of the county-level business system and improve the county-level business network and the three-tiered logistics delivery system at the village, township, and county levels. We will also expand the coverage of rural e-commerce. Thus, we will increase farmers' incomes and improve rural consumption.
Fifth, we will launch campaigns to boost consumption. Provided that prevention and control protocols were duly observed, we will continue to launch events such as the National Consumption Promotion Month, online shopping festivals, which boost brand and quality consumption, and Chinese food festivals. We will also provide guidance for local consumption promotion campaigns that combine business, tourism, cultural, and sports sectors, adopt both online and offline measures, and connect urban and rural areas. In this way, we can keep market expectations stable and bolster consumption confidence.
_ueditor_page_break_tag_ThePaper.cn:
What are the achievements and experiences that China's pilot FTZs have secured in terms of expanding opening-up in 2021? How will the MOFCOM arrange the work on pilot FTZs this year? Thank you.
Guo Tingting:
Thank you. I'll take your questions. In 2021, the MOFCOM has worked with relevant government bodies and resolutely implemented the decisions made by the CPC Central Committee and the State Council. We have been playing our part to help foster a new development paradigm. A series of new measures were introduced in pilot FTZs to expand opening-up, and new progress was made in various fields.
First, the MOFCOM released China's first negative list for cross-border trade in services at the Hainan Free Trade Port. The list outlined 70 special management measures in 11 categories and was a breakthrough of China's management model of trade in services. It is also another important measure taken by China to pursue high-level institutional opening up.
Second, the MOFCOM introduced a total of 19 reform and innovative measures concerning trade and investment facilitation and promotion in pilot FTZs. These measures cover five aspects, including the facilitation of trade, investment, international logistics, and financial services in supporting the real economy and exploring the role of the judiciary in guaranteeing trade and investment facilitation.
Third, the MOFCOM updated the negative list for the market access of foreign investment in its 2021 edition. The number of special administrative measures applied in this edition was reduced to 27, and all measures applied to the manufacturing industry were removed. The openness of China's service industry continues to expand.
Fourth, the MOFCOM promoted the latest group of 18 "best practice cases" involved in trade and investment facilitation, financial services that support real economy, SOE reforms, environmental protection, and other fields. A total 278 achievements concerning systemic innovation were promoted on a national level, which facilitates the continuous improvement of China's business environment.
In 2021, the actual use of foreign capital of all 21 pilot FTZs in China reached 213 billion yuan, and their import and export volume hit 6.8 trillion yuan, up 19% and 29.5% year on year, respectively. With less than four-thousandths of China's land area, these 21 pilot FTZs have achieved 18.5% of the country's foreign investment and 17.3% of the foreign trade, making a great contribution to stabilizing foreign trade and investment.
Looking forward, the MOFCOM will follow the decision being made by the CPC Central Committee and the State Council, doubling the efforts to carry out planning for and promoting the high-quality development of pilot FTZs. The MOFCOM will work to dovetail the construction of pilot FTZs with fostering a new development paradigm and give full play to the exemplary and leading role of pilot FTZs in promoting reform and opening up. Specific measures are as follows:
First, we will further expand the high-level opening-up. We will pilot to align policies in the pilot FTZs where conditions permit and the free trade port with internationally high-standard economic and trade rules in a bid to promote high-level institutional opening up. We will also work to introduce a negative list for cross-border trade in services in pilot FTZs.
Second, we will further carry out deeper reforms. Focusing on key sectors, crucial links, and fundamental institutional arrangements, we will establish pilots of deeper reform, get rid of institutional barriers, and work to achieve more high-quality institutional innovation results. More economic administrative powers at the provincial level will be delegated to pilot FTZs.
Third, we will further take the lead in promoting high-quality development. We will encourage pilot FTZs to carry out integrated innovation throughout the entire industrial chain based on the actual local situation. We will also support them to attract global resources and factors of production of the industrial chain and develop featured and dominant industries in a bid to build more world-leading industrial clusters.
That concludes my response. Thank you.
_ueditor_page_break_tag_Xing Huina:
Due to time constraints, we will only have one last question.
Yicai:
We noticed that China's total imports and exports of goods exceeded $6 trillion in 2021. What is the driving force behind China's rapid foreign trade growth? What role has foreign trade played in promoting China's economic development as well as the global economic and trade recovery? Thanks.
Li Xingqian:
Thank you for your care and support for China's foreign trade. Foreign trade growth was a major highlight of China's economic performance in 2021. The fundamental reason is that the Chinese government calmly responded to various risks and challenges while maintaining its position as a global leader in economic development and COVID-19 response, thus fully leveraging its overall foreign trade advantage. There are four major driving forces behind China's rapid foreign trade growth: policies, external demand, supply and new business forms.
First, relevant policies have been prudent and effective. The Chinese government has cherished trade market entities, maintained the continuity, consistency and sustainability of its policies, and launched a series of support policies regarding tax and fee reductions, financing and credit guarantees. Meanwhile, the government has formulated a plan to promote the high-quality development of foreign trade during the 14th Five-Year Plan period (2021-2025) and opinions on accelerating the development of new business forms and models of foreign trade. It has also conducted cross-cycle adjustment. Thanks to these measures, market entities and expectations have been stabilized.
Second, external demand gradually recovered. The global economy as a whole is showing recovery momentum. The WTO estimates global trade in goods grew by 10.8% in 2021. Various countries were controlling the pandemic, resuming production and promoting consumption, which increased the direct and indirect demand for Chinese products. China's exports of intermediate goods, capital goods and consumer goods increased by 27.9%, 13.7% and 13.1%, respectively.
Third, the supply capacity is strong. China has a complete industrial system, with comprehensive supporting facilities and strong resilience within its industrial chain and supply chain. It can quickly adapt to changes in international market demand and swiftly increase supply. At the same time, China and its neighboring countries have formed a regional industrial chain of efficient cooperation, which further enhances our supply advantages.
Fourth, the business format accelerates innovation. China is a fertile ground for the vigorous growth of new business formats and new models such as cross-border e-commerce. Various platforms and merchants have given full play to their advantages in spheres such as online marketing, contactless transactions and short-distance distribution to help foreign trade show a strong momentum of expansion despite COVID-19 impacts. The scale of cross-border e-commerce imports and exports reached 1.98 trillion yuan, an increase of 15%, and market procurement trade exports increased by 32.1%. China now has more than 1,500 comprehensive foreign trade service enterprises and more than 2,000 overseas warehouses, and we've built more than 130 bonded maintenance projects.
In 2021, the achievements of China's foreign trade development were well-rounded and multi-level, which effectively served the construction of the new development pattern and made important contributions to the recovery of the global economy and trade.
From the domestic perspective, foreign trade had three major achievements: First, it has effectively driven GDP growth. Net exports of goods and services drove the annual GDP growth by 1.7 percentage points, with a contribution rate of 20.9%. Second, it promoted stable employment. There were 567,000 foreign trade enterprises with an actual import and export performance throughout the year, directly and indirectly prompting the creation of 180 million jobs. Third, it maintained the stability of the industrial chain and supply chain. It has guaranteed the supply of important resources and key components, playing an indispensable role in safeguarding domestic supplies and stable prices and promoting the smooth operation of various upstream and downstream industries.
From the international perspective, China's foreign trade made at least three major contributions: First, it actively supported the global fight against the pandemic and promoted the building of a community with a shared future for human health. China has exported anti-pandemic materials in an orderly manner and provided more than 2 billion doses of vaccines to the world, making it the world's largest provider. Second, it effectively filled the gap between global supply and demand and provided timely products and services for the production and people's livelihood in various countries. Third, we shared China's development opportunities with the world. We have successfully held important international expos such as the CIIE, the China Import and Export Fair and the CIFTIS. In the first three quarters of last year, China contributed 14.1% to global import growth. China actively advocates free, fair and green trade and deepens bilateral and multilateral economic and trade cooperation. It is the backbone of global economic and trade recovery. Thank you.
Xing Huina:
Thank you to the speakers for summarizing the commerce development in 2021 and sharing the outlook for 2022 with us. If you still have questions, the persons in charge of the press and publicity work of the Ministry of Commerce are also here, and you can continue to keep in touch with them after the press conference. That's it for today's press conference. Thanks to the four speakers, and also thanks to the media friends.
Translated and edited by Yan Xiaoqing, Liu Qiang, Zhang Jiaqi, Zhang Rui, Zhang Tingting, Li Huiru, Cui Can, Liu Sitong, Zhu Bochen, Huang Shan, Ma Yujia, Wang Qian, Wang Yiming, Wang Wei, Gong Yingchun, Yang Xi, Zhang Liying, Jay Birbeck, Drew Pittock and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.
Speakers:
Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT)
Luo Junjie, director general of the Bureau of Operation Monitoring and Coordination of the MIIT
Zhao Zhiguo, director general of the Bureau of Information and Communications Administration of the MIIT
Chairperson:
Chen Wenjun, director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO
Date:
Jan. 20, 2022
Chen Wenjun:
Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Mr. Tian Yulong, chief engineer and spokesperson of the Ministry of Industry and Information Technology (MIIT). Mr. Tian will brief you on the development of the industry and information technology sector in 2021 and take your questions. We are also joined by Mr. Luo Junjie, director general of the Bureau of Operation Monitoring and Coordination of the MIIT, and Mr. Zhao Zhiguo, director general of the Bureau of Information and Communications Administration of the MIIT.
Now, let's give the floor to Mr. Tian.
Tian Yulong:
Ladies and gentlemen, friends from the media, good morning. I'd like to begin by expressing my heartfelt gratitude to you for your attention and support for developing the industry and information technology sector. Next, I'll brief you on the general situation of 2021.
Since the 18th National Congress of the Communist Party of China (CPC), the CPC Central Committee with Comrade Xi Jinping at its core has made significant decisions to develop China into a manufacturer of quality and build the country's strength in cyberspace. Under the guidance of these decisions, China's industry and information technology sector has seen historic achievements and transformation, providing strong support for building a moderately prosperous society in all respects. In 2021 especially, against the backdrop of complex and challenging environments and multiple risks and challenges, all government bodies and departments involved in the industry and information technology followed the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. We earnestly carried out decisions made by the CPC Central Committee and the State Council and worked hard to coordinate epidemic prevention and control with economic and social development. We forged ahead and overcame difficulties, redoubled our efforts to ensure stability on the six fronts (employment, finance, foreign trade, foreign investment, domestic investment, and market expectations), implemented the tasks of guaranteeing stability in six areas (employment, people's livelihood, market entities, food and energy, stability of industrial and supply chains, and grassroots operations), and thoroughly carried out the strategies of developing China into a manufacturer of quality and building the country's strength in cyberspace. As a result, China's industrial economy sustained recovery and development. Its information technology sector made positive progress, putting the implementation of the 14th Five-Year Plan off to a good start. The overall growth of industry and information technology in 2021 has the following four features:
First, the industrial economy saw sustained recovery and development. In 2021, following the requirements being made by the Central Economic Work Conference, notably safeguarding macroeconomic stability and ensuring that the economy operates within an appropriate range, we have given greater priority to promoting the stable growth of the industrial sector and taken a series of measures. Through strengthening the guiding role of planning and policies, we introduced and implemented various plans from the 14th Five-Year Plan concerning key sectors and fields of industry and information technology. We formulated a series of policies and measures that ensure the industry's stable growth. We proactively addressed the adverse impact of sporadic pandemic outbreaks, the price hikes in bulk raw materials, and the constraints on energy. We adopted coordinated policies, managed to guarantee the interests of market players, stabilize investment and foster consumption, and effectively ensured the generally balanced and stable development of industrial production. In 2021, China's added value of industries above designated size grew by 9.6% year on year, or an average two-year growth rate of 6.1%. Among them, the growth rate in the third quarter of 2021 declined. However, as our policies on revitalizing the industrial economy took effect, the declining trend was reversed, and the growth rate of the industrial economy rebounded gradually. Under the strong leadership of the CPC Central Committee and the State Council, we managed to overcome various obstacles. As a result, the development of the industrial economy in 2021 generally went well with satisfying results, and this did not come easily.
Second, industrial transformation and upgrading accelerated notably. In 2021, we focused on stabilizing the industrial and supply chain, sped up the digital and green transformation of industries, spared no effort to enhance the core competitiveness of the manufacturing industry, and strived to facilitate the transformation and upgrade of traditional industries as well as the development of emerging industries. As a result, we have accomplished achievements in three aspects. First, the digital transformation of the manufacturing sector was accelerated, and the innovative development of the industrial internet saw remarkable progress. Security systems for internet platforms were established, and the "5G+industrial internet" was applied in 20 scenarios and 10 key industries. The capacity of innovative applications ranked in the top tier globally. Second, the green and low-carbon development of industries saw positive progress. We formulated and published implementation plans concerning carbon neutrality in industrial fields and key sectors and steadily advanced the green transformation of traditional industries. The output of crude steel in 2021 decreased by 32 million metric tons compared with the previous year, down 3%. In the first 11 months of 2021, the energy consumption per unit of the added value of industries above the designated size reduced 5.5% year-on-year, which was remarkable progress. Third, emerging industries maintained a relatively fast growth, and high-tech manufacturing and equipment manufacturing grew a more vital driving force and saw rapid development. Industrial software, big data, cloud computing, artificial intelligence, and other new technologies, industries, and business forms projected a strong growth rate. The new energy vehicles (NEVs) sector, which attracted widespread attention, saw rapid development, and more than 3.5 million NEVs were produced and sold respectively in 2021, up 160% year on year. Therefore, the industrial transformation was brought onto a fast track in 2021.
Third, measures providing vital relief to small- and medium-sized enterprises (SMEs) were implemented and enhanced effectiveness. The CPC Central Committee and the State Council have attached great importance to the development of SMEs and regarded facilitating the development of SMEs as a long-term strategy for stabilizing growth and employment. Under the leadership of the State Council's working mechanism on promoting the development of SMEs, the MIIT has been working with relevant departments of the State Council and local governments to strengthen coordination, supervision, and guidance. We have been working to constantly optimize the business environment of SMEs, further protect and stimulate the vitality of market entities, provide more favorable policies and continuous services. We have also introduced policy packages that provide vital relief and benefit to SMEs and established long-term mechanisms that prevent and resolve the problem of defaults on payments to SMEs, which has proved to be effective currently. Policies such as tax and fee cuts and inclusive financing continue to take effect and significantly reduce the burden on enterprises. In the meantime, we strive to promote the rapid development of SMEs towards high growth potential, advanced technology, and a strong market competitive edge. The MIIT worked with relevant government bodies and introduced policies on developing high-quality manufacturers and improving SMEs' competitiveness. Over 40,000 enterprises in China have high growth potential, advanced technology, and a strong market competitive edge. The number of "little giant" enterprises in China amounted to 4,762, and single-product manufacturing specialists reached 848. They have become the benchmark demonstration enterprises in their respective and specialized fields, and a group of innovative enterprises and business startups continue to emerge and grow.
Fourth, the information and telecom industry made new leaps forward. Last year, by further leveraging the enabling role of the new generation of information technology, we continued improving and building new types of infrastructure, and vigorously fostered new forms of business and new applications, thus continuously enhancing our capacity to support the digital transformation of the economy and society. Here we outline the main features. First, the industry developed at an increasingly higher speed. In 2021, the revenue of the telecom business increased by 8% year on year, and that of software and information technology services grew by 17.7% year on year. The construction of "double gigabit" network infrastructure sped up, covering 300 million households with gigabit optical fiber networks. A total of 1.43 million 5G base stations were established and opened, and 512,000 administrative villages across the country got access to broadband. All those are of historic significance. What is also historic is that telecom difficulties in poor areas were addressed, a remarkable achievement even worldwide. Substantial outcomes were made in the innovative supervision of the industry, with major progress in special projects to regulate the internet industry, regulate apps infringing on users' rights and interests, and upgrade internet applications for the aged. The foundation of security was continuously consolidated, with solid progress in the prevention and combat of telecom and internet fraud, the protection of personal information, and the management of data security. At the same time, the whole industry actively participated in and served major national events. We offered sound telecom and cyber security services to the celebrations of the centenary of the founding of the Communist Party of China (CPC) last year and are going all out to ensure those services at the Winter Olympics and Paralympics. All the venues in the three competition zones in Beijing and Zhangjiakou have realized full coverage of 5G, strong support and guarantee for online broadcasting of events and a smart Winter Olympics.
Those are the main features of our work in four aspects last year. In 2022, we face a more challenging, complex, and uncertain external environment. China's industrial economy faces triple pressure from shrinking demand, supply shock, and weakening expectations, and the task of ensuring stable growth remains a challenge. We will thoroughly implement the spirit of General Secretary Xi Jinping's important addresses and the Central Economic Work Conference, continue to follow the general principle of pursuing progress while ensuring stability, and promote the high-quality development of industry and information technology. We will coordinate epidemic prevention and control and economic and social development, balance development and security imperatives, focus on our goal of building China into a manufacturer of quality and building China's strength in cyberspace, and give top priority to stabilizing industrial growth. We will do a good job in anticipatory adjustments, fine-tuning, and cross-cyclical adjustments; strive to enhance the core competitiveness of the manufacturing sector; improve the quality and efficiency of the industrial economy while promoting its stability; and keep the proportion of the manufacturing sector basically stable. We will strengthen and boost the real economy and lay a solid foundation for the economy so as to welcome the convening of the 20th CPC National Congress with outstanding achievements.
That is all I have for now. My colleagues and I are ready to answer your questions. Thank you.
Chen Wenjun:
Thank you, Mr. Tian. The floor is now open to questions. Please indicate the media organization you work for before raising questions.
_ueditor_page_break_tag_CCTV:
The year 2021 marks the first year of the 14th Five-year Plan period (2021-2025) and a year of special importance in China's modernization drive. Industry is the leading part of the national economy, and a stable industry helps stabilize the economy. What is your comment on the overall performance of the industrial economy in 2021? Thank you.
Tian Yulong:
Thank you for your question. I mentioned it when briefing on the overall situation just now. In the special year 2021, we strived to overcome adversities brought by sporadic epidemic outbreaks, tighter supply of production factors, and constantly high commodity prices and adopted a slew of policies and measures to stabilize industrial growth in accordance with the decisions and plans of the CPC Central Committee and the State Council. Our efforts ensured the recovery of the industrial economy, and enabled progress in stabilizing and modernizing the industry chain and supply chains as well as even stronger internal driving forces for high-quality development. All those provided strong support for macroeconomic growth.
In general, the performance of the industrial economy last year had the following features:
First, the industrial economy sustained its recovery. It maintained an overall stable development last year, while the growth rate was relatively higher in the former quarters and lower in the latter. In the third quarter in particular, the growth rate declined month by month due to the epidemic, flooding, and the tighter supply of energy. Under the leadership of the CPC Central Committee and the State Council, the MIIT, together with other relevant departments, implemented a series of measures, including helping enterprises out of difficulties, ensuring energy supply, and stabilizing energy prices, which yielded remarkable results. The growth rate in the fourth quarter reversed the downward trend and began to pick up month by month. In 2021, China's industrial added value of industrial enterprises above designated size saw a year-on-year increase of 9.6% and a two-year average increase of 6.1%, higher than the pre-epidemic level in 2019. In particular, the value added to the manufacturing sector saw a year-on-year increase of 9.8% and a two-year average increase of 6.6%. The utilization rate of industrial capacity in 2021 was 77.5%, 3 percentage points higher than the previous year. Business performance improved significantly. In the first 11 months of last year, profits of industrial enterprises above designated size registered a year-on-year increase of 38% and a two-year average increase of 18.9%. Their operating margin reached 6.98%, a relatively high level in recent years. Industrial export maintained rapid growth, with the export delivery value of industrial enterprises above designated size logging a year-on-year increase of 17.7% and a two-year average increase of 8.3%. Export also showed a growth trend. Those altogether testify to a good and overall stable performance of our industrial economy.
Second, key industries have maintained growth. In 2021, 39 out of the 41 industrial categories continued to grow, with 15 industries registering more than double-digit growth. The added value of raw material manufacturing increased by 5% year on year, with a two-year average growth of 4.1%. Profits grew 92% year on year thanks to the raw material price rise, which contributed 60% to the profit growth of the whole industry. The raw material industry saw a sound performance last year. The added value of the equipment manufacturing industry registered a year-on-year growth of 12.9% and a two-year average growth of 9.7%, contributing over 40% to the overall industrial growth. Driven by the stay-at-home economy and overseas market demand, the electronic industry maintained a double-digit growth in its industrial added value and export delivery value. The added value of consumer goods manufacturing maintained an overall stable recovery with a year-on-year growth of 9.8% and a two-year average growth of 4.5%. In particular, driven by the demand for medical supplies to fight against COVID-19, the added value of the pharmaceutical manufacturing industry surged 24.8% year on year.
Third, the industrial structure has been constantly improved. Investment in the manufacturing sector has been adjusted and improved, recording a year-on-year growth of 13.5% in 2021, while that in high-tech manufacturing rose 22.2%. The proportion and structure of investment have also been constantly improved. Driven by investment, the added value of high-tech manufacturing grew rapidly, up 18.2% year on year. New intelligent and upgraded products also saw a rapid increase, so did the output of industrial robots, integrated circuits, and other new products. In particular, the production and sales of new energy vehicles exceeded 3.5 million, 1.6 times greater year on year. These are the highlights of manufacturing. Restructuring and replacing old growth drivers are making steady progress with remarkable effects. The 5G technology and industrial networks accelerated the digital transformation of manufacturing. Breakthroughs made in some key fundamental technologies also shored up the upgrading of manufacturing. The container production doubled, and the industry and supply chains of photovoltaic power, wind power, and ships are internationally competitive. Under the overall plan for carbon peak and carbon neutralization, we have formulated some plans, including implementation programs for the industrial sector and key industries involving non-ferrous metals and building materials. In the first 11 months of last year, the energy consumption per unit of the added value of industrial enterprises above designated size decreased by 5.5% year on year.
Fourth, small and medium-sized enterprises (SMEs) have resumed growth. We issued a series of policies to bail enterprises out, and further stimulate market players. In 2021, the revenue and profit of SMEs above designated size jumped 20.7% and 28.2% year on year, respectively, with two-year average growth of 9.8% and 17.1%, respectively, which are faster than the growth of the same period in 2019. We support SMEs to become more professional and specialized in niche sectors. A group of startups and innovative businesses are emerging. An MIIT survey of 1,185 "little giant" companies — leading SMEs — showed the profit margin for the first 11 months reached 10.9%, which is a good performance on the whole. Nevertheless, SMEs, especially small and micro businesses, are subject to market and epidemic changes and facing difficulties in their operation. We are stepping up efforts to help them.
Generally speaking, the current situation is still uncertain and complex. We are satisfied with the work in 2021 and confident to welcome 2022. We still have many favorable conditions, including fast economic growth, a sound growth momentum on the whole, China's leading role in COVID-19 response, a complete industrial system and sound supporting capacity, and a resilient economy with potential. Besides, with the implementation of both macro and micro policies, I am convinced that the overall development trend of the industry and information technology will not change in 2022, so will the fundamentals sustain China's long-term economic growth. With the implementation of these policies, we are confident of overcoming various difficulties to achieve a stable performance of the industrial economy. Thank you.
_ueditor_page_break_tag_CNBC:
I have two questions. Statistics show that chip and auto production has recovered in recent years. Does this mean that the shortage of chips will be solved soon? What's your outlook for 2022? The second question is about China's "dynamic zero-COVID-19" approach. Some foreign analysts are worried about its damage to China's supply chain. Is the MIIT concerned about the issue? What measures will be adopted to ensure stable production? Thank you.
Luo Junjie:
Thank you. The manufacturing capacity of integrated circuits continued to be strained last year, which led to a knock-on chip shortage through all sectors and significantly impacted the performance of global industries. In particular, the auto industry was hit worst. Many domestic auto producers have cut production or suspended production in the short term. According to our analysis, there are two reasons behind it. On the one hand, with upgrading social intelligence, the demand for chips – the most critical component in smart equipment – continues to grow. On the other hand, as the pandemic spreads globally, some countries are still imposing unjustified sanctions and suppression of enterprises from other countries, which has severely hit the global semiconductor supply chain. These overlapping factors have given rise to the chip shortage. As the market adjustment mechanism gradually plays its role, together with the joint efforts of governments, auto, and chip producers, the chip shortage in the auto sector is easing gradually. But we should also see that the stability of the global supply chain of integrated circuits is still facing severe challenges, and the chip supply will remain strained for a long time to come.
The integrated circuit (IC) industry is highly globalized. China has the world's largest integrated circuit market, and the Chinese government is committed to boosting close global cooperation to build sustainable and stable industrial and supply chains based on the principle of openness and development. Therefore, the MIIT has been keeping a close eye on the automobile chip shortage issue and actively responding to it by taking multiple measures to ensure chip supply and maintain the steady operation of the automobile industry. Next, we will also strengthen communication and cooperation with relevant countries and regions, encourage leading domestic and foreign enterprises to increase investment in a coordinated manner, and enhance the supply capacity of the whole chip industrial chain. In addition, we need to effectively implement the "Several Policies for Promoting High-quality Development of the Integrated Circuit Industry and the Software Industry in the New Era" No. 8 document for 2020 issued by the State Council and related supporting policies. By doing so with full efforts, we aim to promote a free flow of various resources, create a fair and just market environment, achieve high-quality development of the IC industry, and help build a global industrial system featuring co-existence and win-win cooperation. Thank you.
Tian Yulong:
Let me answer your question about the impact of the dynamic zero-COVID-19 approach. I noted that some foreign media wrote articles on the policy's negative influence on the industrial economy. As we all know, China has been following the anti-pandemic principle of preventing inbound cases and a domestic resurgence, which has so far generated remarkable results. In accordance with the requirements of the CPC Central Committee and the State Council, China has taken the lead to bring the COVID-19 under control by putting people and their lives first. It is fair to say that China has led the world in both economic growth and pandemic prevention and control.
As I said just now, China's economic growth, especially in the industrial sector, shows that the country's anti-pandemic policy is beneficial to the industrial and supply chains. It is by adopting the right pandemic prevention strategies that China has led the world to resume work and production and ensure the stability and security of the industrial and supply chains. As a result, China's economic development, export, and some other sectors are all growing smoothly on the whole. In my opinion, the stability of the industrial and supply chains can be attributed to our effective anti-pandemic endeavors. Of course, you may be concerned about the current multiple sporadic outbreaks in China. Some cities involved have taken control measures, which may exert temporary and small-scale influences on the industrial and supply chains of some regions. However, the short-term effects in a limited scope did not have a big impact on the macro-industrial chain. In particular, with the increasing precision of China's pandemic prevention and control policies, there will not be a big impact on the industrial and supply chains, especially on industrial enterprises, and the stability and security of the chains can still be guaranteed. Certainly, the pandemic is still spreading internationally and has yet to be effectively controlled, making the external environment of the industrial and supply chains uncertain, which will impact China's industrial and supply chains to some extent.
I believe that by adhering to the anti-pandemic policies and taking more precise and effective measures to ensure the safety of supply and industrial chains, China's industrial and supply chains will become more resilient. We will also make greater efforts to keep the global supply chains smooth, which I deem essential to the stable operation of our industries, the production-marketing coordination, the unimpeded domestic and foreign trade, and the industrial economy's steady development this year. Coordinating pandemic prevention and control with economic and social development, especially industrial economic growth, remains a priority this year.
_ueditor_page_break_tag_CNR:
According to the recently held National Work Conference on Industry and Information Technology, the industry and information technology system have successfully fulfilled the main targets and tasks for the year, realizing a good start to the 14th Five-Year Plan (2021-2025) period. Could you give us more details on the development of the information and communications industry, including 5G and the industrial internet? Thank you.
Tian Yulong:
Thank you for your question. I would like to invite Mr. Zhao Zhiguo to answer it.
Zhao Zhiguo:
Thank you for your question. Last year, the information and communications industry deepened efforts to implement the strategy of building China into a strong country in manufacturing and cyberspace and made new strides in accelerating the integration of information and communications technologies with diverse economic and social sectors. The annual revenue of the telecom business reached 1.47 trillion yuan with a year-on-year growth of 8%, up 4.4 percentage points year on year. The total volume of the telecom business stood at 1.7 trillion yuan, up 27.8% year on year. The measures taken are mainly as follows:
First, we have strengthened planning for the 14th Five-Year Plan period and sped up improvements to the policy planning system. We issued a development plan for the information and communications industry during the 14th Five-Year Plan period and launched five three-year (2021-2023) action plans of the coordinated development of "dual gigabit" networks, the application of 5G, the industrial internet innovation and development, the new data center development, and the IPv6 traffic increase. The plans have together constituted the policy system for the development of the information and communications industry, giving full play to the guiding role of the policies.
Second, the construction of new types of infrastructure has achieved remarkable results, and the support capacity for digital transformation has been further enhanced. The number of new 5G base stations in the whole year reached 654,000 while the number of 5G mobile terminal connections reached 518 million. The gigabit optical networks covered 300 million households, and the first batch of 29 "gigabit cities" were built, which promoted the development of China's dual-gigabit network capability, users' quality and innovative applications, achieving good results. The industrial internet infrastructure, featuring the coordinated development of "cloud computing, networks, edge computing and terminals," has basically taken shape. "5G+industrial internet" has shaped 20 typical application scenarios, such as remote equipment control and machine-vision quality inspection, across 10 key industries, such as mining, steel and electric power. Remarkable achievements were made in empowering various industries and businesses to transform and upgrade.
Third, solid steps have been taken towards industry oversight, and supervision efficiency has continued to improve. The modernization of industry supervision has also improved. A new regulatory system based on credit is in its nascent stages, and the coordinated national regulatory pattern is being rapidly constructed. Platform governance achieved important breakthroughs. We organized special rectification actions for the internet industry as well as actions to improve user experience of information and communications services. As a result, the compliance of business operations, the openness of the industry ecology and user satisfaction have been significantly improved. We have further promoted in-depth special rectification campaigns on apps' infringements of user rights and interests. We have built a national app testing platform, with the ability to test 180,000 apps every month and carry out technical testing, which has basically solved the problems of "not being able to close pop-ups" and "unexpected redirects of pop-ups."
Fourth, the capability to safeguard cyber security has been continuously improved, and defense measures have been consolidated. We have promulgated the "Regulation on the Management of Security Loopholes of Network Products," established a national loophole management system, built a 5G application security innovation demonstration center, and improved 5G application security safeguard capabilities. We have fully implemented real-name registration management for the internet of vehicles (IoV), and the security management system of the IoV has basically been established. We further implemented the classified network security management of industrial internet enterprises, optimized the policy environment for the development of the cyber security industry, deepened the governance of the basic level of the industry, and made significant breakthroughs in preventing and controlling telecommunications and online fraud.
Fifth, deeply and practically serving people's livelihood, and making digital life more convenient. Universal telecommunications services have been steadily advanced, and we made the historic realization of "broadband access to every village" for each administrative village across the country, helping more people get on the "digital train." For special groups such as rural households alleviated from poverty, we have carried out targeted fee reduction and other related work, saving a total of 8 billion yuan for users, which has greatly reduced the cost of network usage. The first batch of 217 websites and apps closely related to elder communities have undergone age-appropriate transformations and passed the evaluation, providing more comprehensive, considerate and direct facilitation services for the elderly. 5G technology has been used to empower the "smart Winter Olympics" and create smart applications such as smart viewing, cloud broadcasting and smart venues, further enriching the spectator experience, as well as improving event services and venue operations.
In the next step, the MIIT will resolutely implement the guiding principles of the Central Economic Work Conference, focus on development as the top priority and promote steady progress, take effective measures to ensure the information and communications industry maintain stable and relatively rapid growth, continue to strengthen 5G construction and innovative applications, actively promote the upgrading of the industrial internet, accelerate the construction of an agile, accurate and efficient industry supervision system, steadily promote the innovative development of the cyber and data security industry, and ultimately promote the high-quality development of the information and communications industry. Thank you.
_ueditor_page_break_tag_Hong Kong Economic Herald:
In recent years, the rapid development of the digital economy has attracted widespread attention and has become a new engine for the 14th Five-Year Plan. What major achievements did the MIIT make in promoting the development of the digital economy last year? How do you view digital economy trends in the next stage? And how can you make the digital economy operate stably and with a far reach? Thank you.
Tian Yulong:
Thank you for your questions. Let me answer them. The CPC Central Committee and the State Council attach great importance to the digital economy. General Secretary Xi Jinping has given important instructions about it on many occasions. It's fair to say that the development of the digital economy entered a "fast lane" last year. There are several features:
First, since the development of digital economy is also an integration of multiple economic fields, it primarily focuses on the innovation of key technologies. Last year, we made a series of breakthroughs in key core technology areas. Our innovation and development of big data, cloud computing and blockchain are currently at the forefront of the world. Our advantages in this regard are obvious. 5G mobile communications technology, equipment and applications are leading the world. Smartphones have also entered the world's advanced ranks. The foundation of the digital economy, in terms of integrated circuits and software, has also achieved milestones. Therefore, in terms of technological breakthroughs, the digital economy achieved gratifying results last year.
Second, in terms of overcoming difficulties in the digital industry, we have continued to strengthen the industrial economy. There are several characteristics. After the construction of new types of information infrastructure gathered speed, the comprehensive strength of our information infrastructure has reached a new level. As I mentioned just now, we have built the world's largest optical fiber network and 5G network, which lay an important foundation for realizing the digital economy. We have launched 1.425 million 5G base stations. Pushing forward the integration of our cyber industry applications has brought the development of the digital economy into a "fast lane." The resilience of the development of the digital economy is also very remarkable. Last year, business revenue from the software information technology service industry increased by 17.7%, ahead of the industry average. The development of the home economy, online economy and information development has raced through a "fast lane" due to the COVID-19 pandemic, boosting the growth of the industry and the demand.
Third, the digitalization of manufacturing picked up speed. The intelligent manufacturing equipment industry developed rapidly. Last year, the output value of industrial robot manufacturing enterprises above the designated size surged 30.8% year on year; and that of 3D printing equipment enterprises registered a year-on-year increase of 27.7%. In particular, more than 150 industrial internet platforms with national influence were established and over 2,000 "5G+industrial internet" projects are under construction. Digital technology is crucial for SMEs, especially those with high growth potential, advanced technology and a competitive edge in the market. Most of them are innovative enterprises with advantages as latecomers to the digital economy and they develop relatively fast. We believe these SMEs will perform exceptionally well in the digital economy.
Fourth, the ecology of the digital economy improved. We deepened reforms to streamline administration and delegate power, improve regulation and upgrade services. We also simplified approval procedures and optimized relevant processes. These measures supported the development of digital economy enterprises by reducing government-imposed transaction costs. In collaboration with other departments and local authorities, we built a number of digital industrial clusters which leveraged the advantages of different regions in industry, technology and talent. As you might know from news reports, local authorities across the country hosted many exhibitions, conferences and forums, centered around the digital economy last year, while working to facilitate the flow of digital economy factors and upgrade industrial clusters. In addition, we engaged more actively with international efforts through bilateral and multilateral mechanisms such as G20, participated in the formulation of digital rules and cooperated in data and cyber security, and helped more Chinese digital enterprises go global. All these have contributed to the building of a global cyber-community with a shared future. Therefore, the overall development trends of the digital economy are encouraging. Next, we will continue to follow the guidance of the plan to facilitate the development of the digital economy in the 14th Five-Year Plan period (2021-2025) issued by the State Council. We will focus on accelerating the integration of digital and real economies, promoting the development of digital information infrastructure and improving the digital economy governance system. We will take coordinated measures to promote the development of digital industries and the digital transformation of traditional industries, empowering traditional industries with next-generation information technology and fostering new industries, new businesses and new models. Under the guidance of the plan, we will mobilize forces and resources from all quarters to ensure the rapid and stable development of the digital economy. This is our goal and I believe we will achieve it. Thanks.
_ueditor_page_break_tag_Yicai:
Sporadic cases have been reported in several regions, and the base number for the first quarter of last year was relatively high. In this context, what do you think of the industrial growth rate in the first quarter of this year, and what measures will be taken to boost the industrial economy? Thanks.
Tian Yulong:
That's a good question. Mr. Luo Junjie will answer it.
Luo Junjie:
Thanks. Mr. Tian has already mentioned this issue. Facing the downward pressure on the industrial economy, we have been formulating new development policies in collaboration with relevant departments since the second half of last year. In the fourth quarter, the MIIT and the National Development and Reform Commission jointly issued an implementation plan for invigorating the industrial economy and promoting high-quality industrial development. The plan, which includes 16 policy measures to stabilize industrial growth from four aspects, effectively boosted the industrial economy in the fourth quarter of last year. Currently, the industrial economy's recovery is stuttering and we have been facing significant downward pressure in the first quarter of this year due to a range of factors. Globally, there are many uncertainties about the pandemic and the world's economic growth and trade are sluggish. Domestic factors include concerns about supply constraints, weak consumption and investment demand, difficulties facing SMEs, sporadic COVID-19 outbreaks, the base effect, etc. Well aware of the situation, we made plans early and took proactive measures. At the end of last year, we made arrangements to ensure a stable start for industrial performance during the first quarter of this year. Local industry and information technology authorities were required to help enterprises organize operations during the New Year's Day and Spring Festival holidays, strengthen the supply of production factors such as raw materials and labor, and resume work and production after the Spring Festival holiday. In the next step, we will faithfully implement the guiding principles of the Central Economic Work Conference, prioritize stability and pursue progress while ensuring stability. We will continue to strictly observe virus prevention and control protocols and implement existing policies and measures. Meanwhile, we will respond to new developments and roll out more effective measures in collaboration with other departments in terms of finance and taxation, ensuring supply and price stability and supporting the development of SMEs. We will carry out anticipatory, fine-tuning, and cross-cycle adjustments. We will take a series of measures and spare no effort to ensure steady industrial growth in the first quarter, which will act as a "ballast" for the overall economic development. Specifically, we will do the following:
First, we will work hard to boost investment in the manufacturing sector. We will give play to investment's key role in stabilizing industrial growth and accelerate the launch of major projects listed in the country's 14th Five-Year Plan, as well as the corresponding five-year plan in the field of industry and information technology. We will establish a mobilization and service mechanism for major programs in collaboration with relevant departments and local governments. At the same time, we will strengthen the cooperation between industry and finance, encourage and support enterprises to increase investments and guide financial institutions to bolster their support for the digitalization and green transformation of enterprises.
Second, we will actively guide and expand consumption demand. We will seize opportunities from the shopping seasons associated with traditional festivals, such as Spring Festival and Lantern Festival, and unleash the potential of the huge domestic market and tap into residents' consumption potential. We will further implement the strategy of increasing the variety and quality of products and nurturing domestic brands, promote the upgrade of information consumption, and boost the development of the intelligent connected vehicle (ICV) industry, the smart health and senior care industry, as well as the ice and snow equipment industry. We will expand the consumption of new energy vehicles and encourage the use of green smart home appliances and green building materials in the countryside where conditions permit.
Third, we will work to ensure the supply and coordination of energy factors. We will precisely unclog bottlenecks within industrial chains and supply chains, address chip shortage issues, container shortages and labor shortages, accelerate efforts to ensure and coordinate factors of energy, logistics and labor force, prioritize the stable operation of key industrial chains and supply chains, with an emphasis on addressing the chip shortage in the auto industry and maintaining the smooth operation of key component supply chains.
Fourth, we will boost the role of the new impetus as a growth driver. We will stimulate new dynamics of economic growth through upgrading traditional industries with digital and smart technologies and create big, strong emerging industries, improve the multi-level system of industrial internet platforms, deepen the integration and application of 5G and gigabit fiber-optic networks in the manufacturing, mines, energy, agriculture and transportation sectors to contribute to the digital transformation of those industries. We will actively expand applications for virtual reality and smart health and elderly care products, as well as foster emerging industries such as big data, artificial intelligence and Internet of Vehicles. Thank you.
_ueditor_page_break_tag_People's Post & Telecommunications News:
What results have China achieved in 5G developments and applications and what are the shortcomings? What are the MIIT's deployment and plans for future 5G development and what are the priorities? Thank you.
Zhao Zhiguo:
Thank you. Over the past year, the MIIT has implemented decisions from the CPC Central Committee and the State Council, and mobilized forces from all industries to promote innovative 5G development all while making notable progress.
First, we have strengthened policy guidance. The MIIT, together with nine other departments, issued a three-year action plan aimed at coordinating 5G integration and application, and fostering new drivers of economic and social development. We worked with the National Health Commission to carry out 5G plus medical health pilot programs that expand 5G applications in the medical health sector and build a model of sound development of smart medical care. We also worked with the Ministry of Education to carry out 5G plus smart education pilot programs to promote the high-quality development of 5G-enabled education.
Second, we have achieved steady progress in 5G development. China has built the world's largest 5G network with the most advanced technologies. By the end of last year, the country had built more than 1.4 million 5G base stations, of which more than 800,000 are jointly built and shared. The 5G network covers all prefecture-level cities, urban areas of more than 98% counties and 80% townships. The breadth and width of 5G coverage continued to expand during the past year. China's 5G mobile phone shipments stood at 266 million units last year, up 63.5% year on year, showing a steady growth trend.
Third, the application innovation has been improved in both quantity and quality. We organized the fourth "Bloom Cup" 5G Application Competition, which collected more than 12,000 projects from almost 7,000 participants. The number and quality of the projects reached a new high. The application of 5G+4K/8K ultra HD video and 5G+AR/VR was applied to many scenarios last year, such as the art performance marking the 100th anniversary of the CPC's founding, live events, and housing and shopping services, bringing a new experience to consumers. 5G applications in the fields of industry, culture and tourism, energy, and transportation have also continued to expand. Take the 5G plus industrial internet as an example. Typical scenarios, including remote equipment control, machine vision inspection and production efficiency control, have been applied in-depth in key areas, such as mining, ports, iron and steel, and electricity and petrochemical sectors, which has helped enterprises improve quality, reduce costs, improve efficiency and realize green and safe development. Notable progress has also been made in this regard.
Of course, we should also note that there are still challenges in 5G development, including the bottleneck in technology industries, immature business models and the ecological environment yet to be further optimized, which needs coordinated forces from all sectors to promote the scalable development of 5G. The year 2022 is crucial for the scalable development of 5G application, and we will continue to implement the policy decisions and plans of the CPC Central Committee and the State Council, boost the coverage of the 5G network, and advance in-depth integration of 5G and vertical industries. Our major efforts are as follows:
First, we will further consolidate the 5G industry base. We will encourage industrial sectors to make key 5G technology breakthroughs, support enterprises in actively participating in the formulation of a series of international 5G standards, encourage them to develop various 5G chips and modules in a timely manner to meet diversified demands of the industrial application, boost the growth of new end-use products, such as 5G smart mobile phones, wearable devices, virtual reality (VR) and augmented reality (AR), to enrich carriers of 5G technology applications.
Second, we will make steady progress in 5G network development. We will take a moderately proactive approach in advancing 5G network development, further implement the principle of joint development and sharing, continue to expand 5G coverage in counties and towns, improve deep coverage level of the 5G network in crowded areas, such as high-speed trains, transportation junctions, and shopping malls, as well as key sectors of industries and medical care.
Third, we will promote large-scale utilization of 5G. We will strive to do a good job in implementing the "Sailing" action plan for 5G application , hold the fifth "Blossom Cup" 5G application competition, and carry out related work on pilot "5G plus medical care" and "5G plus smart education" projects. We will also promote the application of 5G technology in broadcasting, travel, and other scenarios to help deliver a smart Winter Olympics. We will upgrade the "5G+industrial internet" application and tap into a batch of typical application scenarios at production lines and factories, connecting 5G technology throughout the whole process of engineering projects. We will implement a plan to improve 5G application for individuals and work to launch new types of terminals and apps in a bid to increase people's sense of accomplishment and happiness. Thanks.
_ueditor_page_break_tag_Thecover.cn:
What achievements has the MIIT made in its special campaign on app governance over the past year? Will these efforts be strengthened in 2022? And what is the focus of this work? Thanks.
Tian Yulong:
Mr. Zhao will answer your questions.
Zhao Zhiguo:
Thank you for your questions. The mobile internet has grown rapidly in recent years. Apps are closely related to the production and life of the public. Against this backdrop, the protection of personal information has become a hot issue that hundreds of millions of users are concerned about. The MIIT takes a people-centered approach and attaches great importance to the protection of users' rights and interests. Focusing on such problems as rule-breaking access of phone users' permission and the collection of users' information beyond the normal scope, we have carried out special campaigns for app management. In 2021, we strengthened coordination with other departments, and took comprehensive measures to address a series of prominent problems, and made remarkable progress. Our work can be summarized as follows:
First, we worked to improve laws, regulations and standards to better govern in accordance with the law. App governance must prioritize laws and regulations. Last year, the Personal Information Protection Law, Data Security Law, and other laws and regulations were issued. To further specify requirements, we drafted the Provisions on the Protection and Management of Personal Information on Mobile Apps, for which we have solicited opinions and suggestions from the public. In addition, we promoted the formulation of industry standards such as ones for evaluating the minimum necessity principle in the collection and use of personal information by apps. We can say that these policies and standards have provided strong support for app governance.
Second, we targeted hot and difficult issues and carried out special campaigns. The issues considered most urgent, difficult, worrisome and expected by users are our biggest concern and focus. We carried out campaigns on pop-ups, which appear as an app opens and are difficult to close or mislead users to another page, and effectively urged major internet companies to solve this strongly-complained problem. We conducted special assessments on apps in the travel and accommodation sectors during major festivals and holidays. Last year, we carried out 12 batches of technical assessment for apps – nearly once a month. A total of 1,549 apps were publicly criticized for violating regulations, and 514 apps were taken down for failing to correct their violations. To sum up, we continued to create a cleaner app environment.
Third, we strengthened the application of technologies in app governance. There are now millions of apps in the app stores, and we must further strengthen our technological examination abilities. Last year, with artificial intelligence, big data, and other new technologies, the capability of automatic examination of the national platform for technological examination of apps has improved greatly. 2.08 million apps were examined, which basically covered all apps of major internet companies in China.
Fourth, we guided businesses to strengthen self-discipline and addressed problems at the source. Businesses should take primary responsibility and strengthen their self-discipline, which is of key importance to protect users' rights and interests and push ahead the healthy development of the industry. Last year, we organized related industry associations to call meetings with internet companies on the regulation of personal information protection in apps and provided 16 trainings for nearly a thousand companies to raise their red-line awareness, constantly improve internal governance, and operate in accordance with laws and regulations, all aimed to solve the problem at the source.
Fifth, we improved user experience of services and pursued innovation in governance. Whether our work is good or not ultimately depends on users' feelings. Last November, focusing on major issues affecting user experience, we launched a campaign to improve user experience of information and communications services. We call it the "524" campaign. We urged companies to make a "dual list" for the protection of personal information, improve privacy policies and the management of accessing of users' permission, and optimize customer services with an aim to improve both services and user experience in an interactive manner.
In 2022, we will focus on following major aspects:
First, we will continue to pursue comprehensive measures and improve regulation throughout the chain. We will focus on the supervision of those taking major responsibilities, covering all app stores, third-party software development kits (SDK), terminal companies, and major internet companies, among others, to create a safer consumption environment in the information and communications sector.
Second, we will deepen the "524" campaign to improve service and steadily promote related companies to implement the tasks and requirements of the campaign. We will conduct reviews on a timely basis to better consolidate our achievements and improve users' sense of accomplishment.
Third, we will push ahead joint governance and build a long-term mechanism. We will strengthen coordination with relevant departments to form regulatory synergy and form a comprehensive system featuring government regulation, self-discipline of companies, media supervision, and participation from social organizations and users, thus creating a safer and cleaner app application environment. Thanks.
_ueditor_page_break_tag_China Electronics News:
SMEs are the main force driving national social-economic development, and the CPC Central Committee and the State Council have paid much attention to them by releasing a slew of supportive measures that help them overcome difficulties. How is the current growth of these enterprises? What measures will the MIIT take to further promote SMEs' development?
Tian Yulong:
Thank you for your questions. The development of SMEs remains a public concern, and I have elaborated on them, however, I will add some more.
As I mentioned just now, the CPC Central Committee and the State Council have attached much attention to SMEs – the mainstay of China's social-economic development – and helped them overcome difficulties while stimulating their growth. This was our main task last year. Under the guidance of the State Council's leading group on the development of SMEs, the MIIT, in coordination with other departments and local authorities, has yielded notable results. Focusing on policy framework, services system and the development environment, we prioritized the two areas of financing and protecting SMEs' rights and interests, striving to enhance their capacity. Moreover, we adopted comprehensive policies including cutting taxes and fees, providing more financial support and better services; fostering and empowering high-quality SMEs to promote their steady and healthy development.
According to current statistical data, revenues and total profits of industrial SMEs above designated size rose 20.7% and 28.2% respectively, with average two-year growth of 9.8% and 17.1% respectively. Therefore, generally, it demonstrates a steady and healthy momentum. Big data based on monitoring small and micro businesses' power consumption also showed that from January to November of last year, the power consumption of these firms increased 9.6% year-on-year, and 49.4% of these firms registered a higher power consumption compared to the same period of the previous year, reflecting relatively high productivity. Generally speaking, the SMEs grew well, in spite of some difficulties. The micro and small businesses, in particular, are still facing problems concerning the external industrial chain, as well as pandemic prevention and control, and are in need of improvement.
Next, we will remain focused on the development of SMEs.
First, we will ensure stability and boost the steady and healthy development of SMEs. We will draft more targeted policies and regulations, and continue carrying out the established policies and measures to help them overcome difficulties.
Second, we will promote the high-quality development of SMEs, particularly specialized, refined, characteristic and innovative SMEs. We will improve their innovative capacity and specialized level, as well as their ability to address difficulties so as to achieve sustainable development.
Third, we will strengthen services. The government should coordinate with other sectors and local authorities to implement more supportive policies and establish more service systems. Continued efforts should be made to address issues regarding offering rewards or subsidies to qualified financing guarantee agencies, promoting the targeted docking of enterprises and financial institutions, expanding financing channels, as well as mitigating difficulties faced by the SMEs in accessing affordable financing, so as to ensure the measures are targeted and effective.
Fourth, we will further improve the development environment for SMEs and take effective measures to protect their lawful rights and interests. We have issued guideline on the development of SMEs during the 14th Five-Year Plan period (2021-2025), and will continue to improve our policies by making further assessments and supervising the business environment. We will fully implement the Regulation on Ensuring Payments to Small and Medium-Sized Enterprises to protect their lawful rights and interests. We also call on people from all walks of life to protect SMEs' lawful rights and interests and further improve the long-term mechanism for preventing and resolving payment arrears to SMEs, continue taking special actions to clear arrears owed to SMEs, and ensure the actual implementation of these regulations, policies and measures to benefit the SMEs and help them grow steadily and rapidly. Thank you.
_ueditor_page_break_tag_ThePaper.cn:
The Central Economic Work Conference emphasized that it is necessary to enhance the core competitiveness of the manufacturing industry. During a State Council executive meeting, the shifts from medium- and low-end manufacturing to medium- and high-end manufacturing were also underlined. What progress has the MIIT made in enhancing the core competitiveness of the manufacturing industry? Are there further plans? Thank you.
Tian Yulong:
Thank you for your concern and support to MIIT. Improving the core competitiveness of the manufacturing industry is a requirement put forward during this year's Central Economic Work Conference. This is also a primary task for us in this year and beyond. While ensuring the stability and security of the supply chain and industrial chain in the early stage, we will further enhance the core competitiveness of the manufacturing industry in the next step.
The stability and security of the industrial chain and supply chain are vital to the core competitiveness of the manufacturing industry. Overall, the industrial economy restored growth in the past year. In the first three quarters, the manufacturing value-added in GDP increased to 27.4%. The proportion of the manufacturing industry remained stable. The efficiency of enterprises has also improved significantly. In the first 11 months of last year, profits from industrial enterprises above the designated size increased by 38% year-on-year and 41.3% compared with the same period in 2019. The overall development of the manufacturing industry is relatively fast, and the efficiency improvement is also reasonably noticeable. This is mainly because the resilience of the industrial chain and supply chain has been secured, significantly improving our entire manufacturing industry, especially in some primary and critical areas. The overall capacity has been improved. In particular, the enhancement is reflected in equipment manufacturing, including containers, photovoltaics, wind power, energy, and electricity. International competitiveness has also been enhanced. These are the specific reflections of the improvement of core competitiveness. Last year, the high-tech and equipment manufacturing industries' added value increased by 18.2% and 12.9% year-on-year, respectively. Considering the negative impact of the COVID-19, this growth rate is awe-inspiring.
The improvement of the core competitiveness of the manufacturing industry is our main task. Therefore, I summarize the target using the term "3+3." This means three foundations and three focuses. To enhance our core competitiveness, we must lay solid foundations in the following three aspects:
First, we should improve the foundation of industrial technologies. The development of the manufacturing industry hinges on core and key technologies. In this regard, we will make great efforts to launch special projects on developing the key technologies, the lack of which will restrict the improvement of the core competitiveness of the manufacturing industry. Furthermore, we will establish several manufacturing innovation centers. In particular, we will jointly build several centers with local governments to promote the formation of industrial clusters and industrial chain aggregation and enable the coordinated development of upstream and downstream of the manufacturing industry.
Second, we will enhance the technological innovation of the industry. Industrial foundations underpin technology. Six foundations, including essential components, parts, materials, software, basic techniques and industrial technologies, are crucial to improving the manufacturing industry's core competitiveness. We will further accelerate the implementation of projects aiming to reinforce the industrial foundation to enhance the core competitiveness of the industry further.
Third, we will further increase the resilience of the industrial chain and supply chain. We will settle problems arising in the industrial chain and supply chain, increase the advantages, and strengthen weak links. We will upgrade the industry, improve quality, and increase efficiency. We will increase efforts to boost investment in the manufacturing industry comprehensively improve the completeness, resilience and standard of the industrial chain, and accelerate technological upgrades and equipment renewal.
The following will be three focuses. The first is to underline the development of enterprises with high growth potential, advanced technology, and a strong market competitive edge. Therefore, we will launch a series of policies such as fee and tax reduction to promote the development of enterprises with high growth potential, advanced technology, and strong market competitive edge, making them players of improving core competitiveness of the manufacturing industry and a significant driving force of the industrial chain and supply chain.
The second is to improve intelligent manufacturing significantly. With digital and information technologies, we will accelerate the digital transformation and upgrading of the manufacturing industry to maintain the leading position of the equipment manufacturing industry and high-tech manufacturing industry, particularly in manufacturing some high-level components and applications of "5G+industrial internet". To improve the capability, intelligent manufacturing should be our priority for investing our efforts and making breakthroughs.
The third is implementing carbon peaking actions in the industrial sector to achieve green manufacturing. Efforts should be made to accelerate the peaking of carbon emissions in key industries and key areas. We will vigorously develop green manufacturing, leading the upgrades and transformation of the technologies of the manufacturing industry. We will carry out green and low-carbon technology application and product development and implement industrial energy efficiency and water efficiency improvement plans. Low-carbon and green manufacturing is an important driving force for the transformation and upgrading of the manufacturing industry, as well as for its innovation and development. We must also curb the reckless development of high-energy intensity and highly pollutive projects.
With these six measures, the core competitiveness of the manufacturing industry will be significantly improved. Therefore, these will be our focuses in 2022 and the 14th Five-Year Plan (2021-25) period. That's all for my answer to this question. Thank you.
Chen Wenjun:
Thank you to all the speakers and friends from the media. Today's press conference is concluded.
Translated and edited by Zhang Jiaqi, Liu Sitong, Duan Yaying, Liu Qiang, Xu Xiaoxuan, Wang Yiming, Zhang Rui, Chen Xia, Zhang Liying, Wang Yanfang, Yang Xi, Li Huiru, Zhang Tingting, Huang Shan, Wang Qian, Zhu Bochen, Yuan Fang, Cui Can, Jay Birbeck, Drew Pittock and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.