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Read in Chinese

Speakers: 

Tang Yijun, deputy head of the Office of the Commission for Overall Law-based Governance of the CPC Central Committee, minister of justice, head of the National Legal Publicity Office

Yang Wanming, vice president of the Supreme People's Court, justice (second rank)

Yang Chunlei, deputy prosecutor general of the Supreme People's Procuratorate

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office

Date: 

Dec. 4, 2020

Hu Kaihong:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO).

Today marks the seventh national Constitution Day. We are delighted to be joined by Mr. Tang Yijun, deputy head of the Office of the Commission for Overall Law-based Governance of the Communist Party of China (CPC) Central Committee, minister of justice, and head of the National Legal Publicity Office; Mr. Yang Wanming, vice president of the Supreme People's Court, and justice (second rank); and Mr. Yang Chunlei, deputy prosecutor general of the Supreme People's Procuratorate. They will introduce programs of the 2020 national Constitution Publicity Week and the work of the Seventh Five-year Legal Publicity and answer your questions. First, let's give the floor to Mr. Tang.

Tang Yijun:

Friends from the media, ladies and gentlemen, good afternoon. Today marks the seventh national Constitution Day, and this week we are celebrating China's third national Constitution Publicity Week. From Nov. 30-Dec. 6, the Publicity Department of the CPC Central Committee, the Ministry of Justice, and the National Legal Publicity Office will be holding a series of publicity events across China as part of the national Constitution Publicity Week. This year, the publicity week has three main features.

The first feature is its distinctive and salient theme.

The Central Conference on Work Related to Overall Law-based Governance was successfully convened recently. The most important result of the conference was the establishment of Xi Jinping Thought on the Rule of Law and making it the fundamental guideline for overall law-based governance in the new era. This is a milestone event in the history of both the CPC and China. This year's national Constitution Publicity Week has a salient theme, which is to "fully study, promote and put into practice Xi Jinping Thought on the Rule of Law, and work hard to promote the spirit of the Constitution." The theme has been established to ensure the guiding role of Xi Jinping Thought on the Rule of Law in overall law-based governance, to increase public support of Xi Jinping Thought on the Rule of Law, and to raise public awareness of the spirit of the Constitution.

First, the publicity week is organized with a broad political vision. The Publicity Department of the CPC Central Committee, the Ministry of Justice, and the national Legal Publicity Office have jointly formulated a work plan for the national Constitution Publicity Week, which closely combines this year's publicity efforts of the Constitution with the study, promotion, and implementation of Xi Jinping Thought on the Rule of Law, as well as the study and implementation of the spirit of the Fifth Plenary Session of the 19th CPC Central Committee. It highlights the significance, rich implications, essence, and practical requirements for studying, promoting and putting into practice Xi Jinping Thought on the Rule of Law. This helps implement Xi Jinping Thought on the Rule of Law in every aspect and the whole process of overall law-based governance, leading to the practices of fully building a country of socialist rule of law.

Second, the publicity week is of a high standard and has high requirements. The Publicity Department of the CPC Central Committee, the Ministry of Justice, and the National Legal Publicity Office jointly held a launch ceremony for the 2020 national Constitution Publicity Week on Nov. 30. Officials from the Ministry of Education and other government bodies were invited to speak, and relevant works were announced during the event. The publicity week calls for effectively strengthening the purposeful study, promotion and implementation of Xi Jinping Thought on the Rule of Law in terms of one's thoughts, political consciousness, and actions, so as to help put into practice Xi Jinping Thought on the Rule of Law. It also calls for improving the precision, timeliness, and innovation capacity of Xi Jinping Thought on the Rule of Law and the publicity and educational efforts of the Constitution; and further contributes to the quality and effectiveness of this year's national Constitution Publicity Week.

Third, the publicity week is being promoted by high-profile government agencies. A symposium was held on the morning of Dec. 4 at the Great Hall of the People organized by the General Office of the National People's Congress (NPC) Standing Committee, the Publicity Department of the CPC Central Committee, and the Ministry of Justice. The theme of the symposium was "fully studying, promoting and putting into practice Xi Jinping Thought on the Rule of Law; Improving the Chinese socialist system of laws, at the heart of which is the Constitution." Li Zhanshu, chairman of the NPC Standing Committee, made an important speech during the symposium and proposed specific requirements accordingly.

The second feature is its diverse range of activities.

We have given full play to the application of all types of media such as newspapers, the internet, mobile apps, WeChat and Weibo accounts, and television. We have also adopted both traditional and modern approaches, focused on a tiered publicity strategy according to different audiences, and use understandable words to explain Xi Jinping Thought on the Rule of Law and the Constitution. It is becoming popular among the public to study, promote, and put into practice Xi Jinping Thought on the Rule of Law and the Constitution.

First, text messages on the topic have been sent. I believe many friends from the media will have received a message from the Ministry of Justice and the National Legal Publicity Office, saying: "Dec. 4 is the national Constitution Day. We should fully study, promote and put into practice Xi Jinping Thought on the Rule of Law; work hard to promote the spirit of the Constitution; and become good citizens by respecting, studying, abiding by and applying the law." We organized and coordinated mobile operators to send this message to 1.2 billion cellphone users. If you have been paying attention, you will notice that you received this text message.

Second, relevant TV programs have been produced. A program called "The Spirit of the Constitution; The Strength of the Rule of Law" will be broadcast on China Central Television (CCTV) at prime time on Dec. 4. The annual top-10 figures in the legal field in China will be revealed during the program. These personnel further demonstrate belief in the Constitution and the upholding of the rule of law from our officials and people, especially frontline police officers.

Third, relevant news reports have been published in newspapers. The People's Daily and Xinhua News Agency have published commentaries accordingly, and many newspapers and journals have set up national Constitution Publicity Week columns and published special editions to introduce the basic situation and progress being made on the topic. Major newspapers and journals also published a themed poster on Dec. 4 titled "Fully study and promote Xi Jinping Thought on the Rule of Law; Work hard to promote the spirit of the Constitution."

Fourth, relevant information has been posted online. Over 150 government websites at the central, provincial and ministerial levels — such as gov.cn, the Xuexi Qiangguo platform, and 12371.cn — have posted relevant news reports. Websites across China engaged in the popularization of law have introduced special coverage for the study and publicity of Xi Jinping Thought on the Rule of Law and the Constitution. News mobile apps, video websites, and e-commerce platforms have also started online publicity efforts, which has improved rates of both exposure and positive engagement.

Fifth, relevant events have been organized at different occasions and platforms. Government bodies across China have given full play to various law-popularization platforms and launched cultural events for the public concerning the rule of law. We have created a set of themed posters to help promote Xi Jinping Thought on the Rule of Law to the general public in a simple and understandable way. These posters will be exhibited at various law-popularization events across China, such as education centers for the rule of law and other themed venues including squares, parks, galleries, streets, and display boards. Themed advertisements will be broadcast in over 2,300 stations, 2,500 high-speed railway carriages, and other public spaces, to ensure that Xi Jinping Thought on the Rule of Law and the Constitution are well-presented and effectively cover a large area.

Third, we have taken coordinated actions.

We have organized and coordinated relevant central departments to take the lead in implementing the responsibility system of "whoever enforces the law shall popularize the law". We have expanded the audience reach of the campaign to study, publicize and implement Xi Jinping Thought on the Rule of Law and the Constitution among primary-level departments as well as the general public, and integrated it into rule of law practices, primary-level governance and social life.

First, we have launched Constitution publicity programs in rural areas. On Nov. 30, the Ministry of Agriculture and Rural Affairs and the Ministry of Justice jointly staged a "Constitution Publicity in Rural Areas" activity in Taiyuan city of Shanxi province to enhance rural residents' rule of law awareness and strengthen rule of law in rural governance.

Second, we have launched Constitution publicity programs in enterprises. On Dec. 1, the All-China Federation of Trade Unions held themed activities in Nanchang city of Jiangxi province. Based on enterprise efforts to inspire a culture of rule of law, and aimed at both the management and employees, the activities publicized the role of the Constitution and the laws in ensuring and regulating the development of the state-owned sector and also the non-public sector of the economy, as well as in safeguarding the rights and interests of workers, so as to promote the development of rule of law enterprises.

Third, we have launched Constitution publicity programs in residential communities. On Dec. 1, the Ministry of Civil Affairs and the Ministry of Justice jointly staged themed activities in Jinan city of Shandong province to provide education on rule of law and legal counseling to residents in terms of matters of public concern. The activities aimed at increasing the attraction and influence of the publicity work.

Fourth, we have launched Constitution publicity programs on campuses. Recently, the final round of the fifth National Students "Studying and Explaining the Constitution" Competition was held by the Ministry of Education. Today, we held "Read the Constitution in the Morning" activity to observe the seventh national Constitution Day, with over 60 million students reading parts of the Constitution simultaneously via the internet. Teachers and students in over 250,000 schools watched the live-streamed activity.

Relevant central departments have also launched themed publicity activities in Party and government organs, at military camps, and in the cyberspace. 

Though the Constitution Week has a time limit, the study, publicity and implementation of Xi Jinping Thought on the Rule of Law and the Constitution is a long-term task. We will institutionalize and regularize the task in order to publicize the Constitution on a daily or weekly basis.

I would like to express my gratitude to the media for their wide coverage of the Constitution Week publicity campaign and their lasting support for and supervision of the judicial administrative work and the work related to overall law-based governance. 

During this Constitution Week publicity campaign, courts and procuratorates at all levels across the country have undertaken much remarkable work. Now, together with Mr. Yang Wanming, vice president of the Supreme People's Court, and Mr. Yang Chunlei, deputy prosecutor general of the Supreme People's Procuratorate, I am delighted to answer your questions. Thank you.

Hu Kaihong:

Thanks, Mr. Tang. Now it's time for questions. Please identify the news organization you represent before raising your questions.

People's Daily:

The central conference on work related to overall law-based governance, which was held recently, established Xi Jinping Thought on the Rule of Law as the guideline for overall law-based governance. How should we combine the study, publicity and implementation of Xi Jinping Thought on the Rule of Law with law popularization to further promote the thought?

Tang Yijun:

Thanks for your question. Xi Jinping Thought on the Rule of Law serves as the fundamental guideline for overall law-based governance in China and our efforts to popularize public knowledge of the law. To study and publicize Xi Jinping Thought on the Rule of Law is our top priority in public legal education in the new era. As the period covered by the seventh five-year plan for increasing public knowledge of the law is drawing to a close and the planning of the eighth edition is underway, we will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and uphold Xi Jinping Thought on the Rule of Law as the overarching principle for law popularization in the new era. We will combine the study, publicity and implementation of Xi Jinping Thought on the Rule of Law with law popularization to ensure it is fully embraced by the people. We will focus on the following three aspects.

First, we will attach great importance to the education of key targets. Leading officials have always been the key targets in law popularization. In the campaign to study, publicize and implement Xi Jinping Thought on the Rule of Law, we should first of all focus on the "key few" and see that leading officials take the lead in studying and accurately grasping its gist, and resolutely implement the major decisions and plans on overall law-based governance adopted by the CPC Central Committee. We will ensure the full implementation of the system in which state functionaries study and use the law. We will ensure that Xi Jinping Thought on the Rule of Law becomes a focus for theory study groups of the Party Committees (leading Party members groups) at all levels, a key course at Party schools (administration institutes) and cadre colleges, and an essential part in leading officials' daily study, legal training, and annual assessment in order to continuously deepen their understanding, enhance their awareness of the rule of law and lay a solid theoretical foundation. We will encourage leading officials at various levels to assume responsibility in respecting, studying, observing and applying the law, and boost their capacity of adopting law-based thinking and approach in their job.

Youth has also been the key target in law popularization. Through implementing the Guidelines on Rule of Law Education for the Youth, we should integrate Xi Jinping Thought on the Rule of Law into school education, and make it part of the legal theory syllabus at universities. We should see that it is included in teaching materials, taught at class and embraced by students. Today, the country has established over 30,000 bases of legal education for youth, in which we will set up themed areas and pavilions for publicizing and studying Xi Jinping Thought on the Rule of Law to guide the young generation to resolutely forge ahead on the path of socialist rule of law with Chinese characteristics.

Second, we will make better use of the publicity platforms to improve the work. We have established the national "Smart Law Popularization" platform, pooling the resources of over 6,000 new media outlets across the country to form a new media matrix. The WeChat public account "China Law Popularization" has attracted over 15 million followers. As of today, more than 3,500 theme parks, 12,000 squares and 34,000 corridors have been set up throughout the country. A total of 95.7% of villages (communities) have established platforms for law popularization. The country has established 72 national bases for law popularization and education. We will make full use of those platforms to expound Xi Jinping Thought on the Rule of Law in a people-friendly fashion, through various integrated media means and channels, and using plain language. In this way, we will see that officials and the general public have a better understanding of the essence and the basic content and requirements of Xi Jinping Thought on the Rule of Law, and ensure this reaches a wider audience.

Third, we will match our actions to our words to ensure good implementation. The key to studying and publicizing Xi Jinping Thought on the Rule of Law is to match our actions to our words, and apply what one has learnt. It is necessary to transform scientific thinking into motivation for practice. We will implement Xi Jinping Thought on the Rule of Law throughout the process of popularizing public knowledge of the law in the new era, and fully embody it in the eighth five-year plan on enhancing public awareness of the Constitution and the rule of law. We will also fulfill our duty in raising public awareness of the law and cultivate belief in the rule of law throughout society, so as to make the rule of law a consensus and basic norm of society. The basic spirit and essentials of Xi Jinping Thought on the Rule of Law are mainly reflected in the 11 requirements put forward by General Secretary Xi Jinping at the central conference on work related to overall law-based governance, as well as his remarks on political direction, important status, work arrangements, key tasks, major relations, and important guarantees of overall law-based governance. To implement Xi Jinping Thought on the Rule of Law in the popularization work requires strengthening the CPC's overall leadership in the work to ensure its right direction, and emphasizing a people-oriented philosophy, so that the public feel the need for its content and praise for the approaches and outcomes. It requires more efforts to popularize the spirit of the Constitution and guiding the whole society to respect, study, abide by, safeguard and use the Constitution. It also requires emphasizing law-based governance to create a good legal environment for handling affairs according to the laws, seeking legal assistance when in trouble, and solving problems and resolving conflicts with the laws. It also requires implementing the responsibility program in which state law enforcement departments are responsible for strengthening public legal awareness, so that the popularization work can be effectively combined with science-based legislation, strict law enforcement and fair justice. It also requires publicizing our law-based governance to the outside world to establish the image of our country as one based on the rule of law. We should also place more emphasis on the "key few," by which we mean leading officials, and motivate officials to be role models in regard to respecting, studying, abiding by, and using the laws. Thank you.

China News Service:

As state organs for legal supervision, what are the key tasks of procuratorial bodies in implementing the Constitution and popularizing public knowledge of it? Thank you.

Yang Chunlei:

Thank you for your question. Constitution-based governance is important content of Xi Jinping Thought on the Rule of Law. As state organs for legal supervision, procuratorial organs are duty-bound to ensure the implementation of the Constitution. Procuratorial organs at all levels should take Xi Jinping Thought on the Rule of Law as the central guideline, adhere to our role specified in the Constitution, give full play to our functions of legal supervision, and take effective measures to promote the implementation of the Constitution.

First, thoroughly studying and implementing Xi Jinping Thought on the Rule of Law and the spirit of the Fifth Plenary Session of the 19th CPC Central Committee, and strengthening the awareness of the Constitution. Procuratorial organs should take the study and implementation as an important political task now and in the future with a high consciousness in political, legal and procuratorial terms. We should focus on safeguarding the national political and economic systems specified in the Constitution when fulfilling our duties. We should also adapt to major changes in the structure of criminal offences, conduct less arrests, and practice prosecution and detention with discretion, so as to minimize and resolve social tensions. Procuratorial organs need to implement the leniency system for suspects and defendants who cooperate fully, and actively resolve conflicts and promote innovations in social governance. We have published guiding cases of procuratorial organs performing their duties in accordance with laws to promote innovation in social governance, and encourage procuratorial organs at all levels to promote social governance in handling cases. We have also issued the No. 6 procuratorial recommendation of the Supreme People's Procuratorate on cyberspace governance to relevant administrative supervision departments, helping establish a sound cyberspace governance system.

Second, adhering to the role of procuratorial organs specified in the Constitution to serve and ensure high-quality economic and social development. Procuratorial organs give full play to functions of criminal, civil, administrative, and public interest litigations, and provide powerful judicial guarantees for economic and social development during the 14th Five-Year Plan period through effective efforts. In the fight against COVID-19, the Supreme People's Procuratorate has issued 14 guidelines or guiding opinions independently or together with other departments of the CPC Central Committee. By the end of September 2020, procuratorial organs across the country investigated and arrested 8,032 suspects involving 6,393 COVID-19-related criminal cases, and approved the arrest of 6,480 people in 5,335 cases. They examined and prosecuted 9,083 filings involving 12,280 people, and initiated 6,850 public prosecutions involving 8,682 people.

Third, fulfilling procuratorial duties with people at the center. We should effectively safeguard the rights of the people, comply with their new demands for a better life in the new era, and further emphasize the people-oriented philosophy when supervising cases handling. We have released the regulations for procuratorates on hearings for examining cases, and promoted public hearings for major, difficult and complex cases, so as to increase judicial transparency and strengthen supervision. We have also helped consolidate and expand the outcomes of poverty alleviation, and implemented the mechanism of rapidly returning property involved in poverty alleviation cases. The Supreme People's Procuratorate has promptly published typical cases of duty-related crimes in poverty alleviation, and promulgated the regulations on the rapid return of property involved in poverty alleviation-related criminal cases together with the Supreme Court and the Ministry of Public Security. We have also stepped up efforts in cracking down on corruption, bribery, abuse of power, false reports, false claims and embezzlement in poverty alleviation work. From January to September 2020, procuratorial organs across the country arrested 1,788 people and prosecuted a total of 5,060 people for crimes involving poverty alleviation funds and other crimes affecting poverty alleviation work. We have also promoted judicial assistance with great efforts, while highlighting the assistance to families who have become poor and fallen back to poverty due to legal cases.

Fourth, stepping up efforts in offering non-public sector equal protection, and fostering a sound business environment based on the rule of law. The non-public sector is an important part of the socialist market economy according to the Constitution. In view of that, we have offered non-public sector equal protection in accordance with the law by giving play to our procuratorial functions. We have renewed our concepts and offered equal treatment and protection to state-owned enterprises and private companies, domestic capital and foreign funds, and large, medium, small and micro businesses. We have also resolutely prevented and corrected the practice of differentiated and selective justice, in an effort to create an equal and orderly environment for the market economy.

Fifth, we combine the promotion and popularization of the Constitution with procuratorial work. Procuratorates at different levels have been pushing for regular and institutionalized learning and promotion of the Constitution through various means. They have promoted the spirit of the Constitution at companies, rural areas, government organizations, schools, communities and military camps as well as on the internet. The Supreme People's Procuratorate has leveraged the media matrix of the procuratorial system, both online and offline and both traditional media and new media, to promote and popularize the Constitution in a variety of ways. Procuratorates across the nation have realized full coverage of Weibo, WeChat and mobile application, and 94% coverage of portal websites. The Supreme People's Procuratorate has attracted 54.46 million followers and released more than 210,000 messages on its new media platforms including Weibo, WeChat and mobile application. The Supreme People's Procuratorate has carried out a new media live streaming campaign enabling the public to gain better understanding of the procurators doing frontline work, and for the latter to reach out to society online to popularize law. This live streaming campaign has achieved 290 million views online. Procuratorates at different levels have organized open day events in various forms. They have deepened publicity and educational efforts on Xi Jinping Thought on the Rule of Law and on the idea that the public should respect, learn, obey, safeguard, and make use of the Constitution on the platforms of WeChat, Weibo, and mobile application and by the means of examples of cases, animations, microfilms, public service ads and MVs. On Dec. 3, the Supreme People's Procuratorate hosted an open day event with the theme of "Learn Xi Jinping Thought on the Rule of Law and Enhance Legal Supervision in the New Era". For key groups including youth, procuratorates have attached much importance to educational activities aiming to promote and popularize the Constitution. In September 2018, Zhang Jun, procurator-general of the Supreme People's Procuratorate, accepted the offer to become the vice principal for rule of law at Beijing No. 2 Middle School, and has given lessons on rule of law at the school for three straight years. By the end of September 2020, a total of 33,000 procurators across the country, including over 3,200 procurator-generals at various levels, assumed similar roles in primary and middle schools. In the second half of 2019, the Supreme People's Procuratorate organized a nationwide lecture tour to promote the rule of law at campuses, giving a total of 96,500 lectures to 80.5 million teachers and students at 108,000 schools. So, this is something that we have kept doing in recent years. Let me stop here. Thank you all!

Cqcb.com:

General Secretary Xi Jinping stressed at the central conference on work related to overall law-based governance that the legal popularization work should pay attention to effectiveness and be well-directed, and law-related education for the youth should be enhanced in particular, and that the legal governance awareness and knowledge of the whole nation should be improved continuously. So, how is the situation of legal popularization and law-based governance currently progressing in China? What is the plan for the future? Thank you. 

Tang Yijun:

It is a great deed in the human history of rule of law to carry out legal popularization among the whole nation in such a big country with a 1.4 billion population, and to put the law into the hands of the people and make them have faith in the law. This fully embodies the system of socialism with Chinese characteristics, and is a major measure for strengthening prevention, addressing the root causes of issues and advancing law-based governance. In nearly 35 years, the work of legal popularization among the whole nation has recorded historical achievements. Especially, after the 18th CPC National Congress, legal awareness has been remarkably enhanced in the whole of society, and the level of law-based social governance has noticeably improved, which can be demonstrated in five aspects:

First, the Party's comprehensive leadership on legal popularization has been significantly enhanced. The CPC Central Committee with Comrade Xi Jinping at its core attaches great importance to legal popularization work. General Secretary Xi Jinping presided over group study sessions of the Political Bureau of the CPC Central Committee many times with the rule of law being the theme, setting an example for the Party and the society. The CPC Central Committee made scientific top-level design for legal popularization work and built the general framework for legal popularization in the seventh five-year public legal education plan period (2016-2020). After the establishment of the Commission for Law-based Governance under the CPC Central Committee, a law observance and education coordination team was set up under the Commission, with which the Party further enhanced the overall planning, coordination and implementation of law observance and education efforts. 

Second, the legal popularization work has been shaped to meet the requirements of the overall situation and to serve the general public, achieving remarkable results. Focusing on the core tasks of the Party and the state and the real problems and difficulties that concern the people, we continued to carry out activities with the theme of "legal popularization serving the overall situation". Suddenly faced with the COVID-19 epidemic, we carried out special activities to promote the rule of law with the theme of "rule of law in epidemic prevention and control", and organized the compilation of epidemic prevention and control related e-books and posters for free public download and use. We continued to deepen the integration of poverty alleviation with education and with the rule of law, and carried out a special action for poverty alleviation with the help of the rule of law to ensure legal popularization and law-based governance can play an important role in the fight against poverty. We also organized the compilation of a series of books for legal popularization to help the fight against poverty. We made efforts to resolve outstanding legal issues faced by people in need, offering strong support for winning the fight against poverty through the rule of law. 

Third, we have broadly implemented a responsibility system for legal popularization in which who enforces the law should also popularize the law. By implementing this system, we advanced innovation in the concepts, systems and practices of legal popularization throughout the nation. The National Legal Publicity Office compiled and published two batches of lists of legal popularization responsibilities for more than 50 central Party and state departments, seeking to have relevant departments actively encourage public participation, listen to opinions widely and make timely releases in the process of drafting and finalizing laws, regulations, rules and judicial interpretations. We have embedded the legal popularization work in the whole process of law enforcement. We inform private parties of the legal grounds for administrative law enforcement as well as legal relief measures. The judicial authorities explain and publicize the law through the whole process of handling various cases, taking full use of legal documents for interpreting the law and conducting legal popularization work through live streaming court trials and other means to offer a vivid, directly perceived experience. 

Fourth, we have deepened efforts to promote rule of law in rural areas. We strengthened the promotion of rule of law in rural areas as the groundwork for implementing the rural revitalization strategy and progressing overall law-based governance. We deepened efforts in building national model villages and communities of democracy and rule of law, and raised the level of law-based rural governance. We have now reviewed all of the designated national model villages and communities of democracy and rule of law and kept 2,899 of them, and we are undertaking dynamic management to ensure their quality. We launched a program to enhance legal literacy in rural areas and made efforts to guide farmers and the officials and the general public of rural areas to abide by the law and resort to legal approaches when encountering problems, in a bid to help pave the "last mile" of law-based governance.

Fifth, rule of law education has been incorporated into the national education system. We have worked with the Ministry of Education and formulated an outline of rule of law education for young people to further promote this topic in this segment of the population. At present, courses are offered at primary and secondary schools and the knowledge on the rule of law now has a certain weight in the college entrance examination. Since 2016, a course on ethics and the rule of law has been in place across the nation's compulsory education and special booklets on the subject have been offered for the sixth- and eighth-grade students. Local authorities are giving full play to the role of the "second classroom" and guiding students to participate in rule of law practices. Most of the nation's primary and secondary schools have been equipped with deputy principals and counselors of the rule of law, with 15 of the nation's provinces, autonomous regions and municipalities having realized full coverage.

At the central conference on work related to overall law-based governance, General Secretary Xi Jinping stressed that we should make more efforts in legal education in a targeted and effective way, and strengthen the subject among young people in particular so as to raise public awareness and knowledge of the rule of law. This identifies the pressing problems of public legal education and determines a direction for us to be innovative in this work. We will thoroughly study and implement the principles from General Secretary Xi Jinping's major addresses, focus on promoting public legal education in a more targeted and effective way, further carry out the legal education in a classified, orderly and effective manner with a focus on young people in the coming eighth five-year legal education program, and endeavor to improve public knowledge of the rule of law so as to promote the all-around development of this aspect by staying true to our shared ideals, blazing a new trail and improving its quality and efficiency.

First, we will carry out legal education in a targeted way. We will respond to the public need and implement targeted legal education to shift legal education from a "flooding" approach to the public to "dripping" in regard to different targets. We will apply new media and new technologies to intelligent legal education, making the internet — the biggest variable — the biggest increment in the innovative development of the legal education.

Second, we will strengthen educational integration. We will further improve and implement the Outline of the Rule of Law Education for Young People, promote the integration of Xi Jinping Thought on the Rule of Law into school education, strengthen the training of teachers for rule of law education, deepen efforts in running law-based schools, and foster young people's awareness of rules and rule of law habits through education and guide, practice and institutional guarantees.

Third, we will improve people's knowledge of the rule of law. We will make it a strategic priority of enhancing the country's soft power to raise this public knowledge and launch campaigns to improve their awareness of the rule of law, encourage the whole society to respect, abide by and use the law, and make the rule of law a social consensus and basic norm. Thank you.

CNR: 

As we know, China Judgments Online plays an important role in judicial practices, promoting both justice via openness and judicial big data research. I have a question for Mr. Yang. In the future, what efforts will be made to help the public deeply understand relevant legal provisions and main points of judicial documents during the legal education process? Thank you.

Yang Wanming:

Thank you for the question. The launching of China Judgements Online promotes full disclosure of judicial documents on the internet. This is one of the SPC's important judicial disclosure moves to implement the CPC Central Committee's strategic plan of overall law-based governance, adhere to the administration of justice for the people and maintaining judicial fairness, and respond to the new demands and expectations of the people in the current information age. The scale and scope of the move is unprecedented. Launched in July 2013, China Judgements Online has so far released more than 107 million copies of written judgments and attracted 52.4 billion visits, with an average daily increase of more than 80,000 copies. Just as the CNR reporter has said, online access to judicial documents is an important way to promote justice by releasing judgements online. It can effectively guarantee the people's rights to be informed, to participate, to express and to supervise so that the public credibility of the judiciary will be enhanced accordingly. Meanwhile, the judgements can play a role of education, evaluation, publicity and guidance. They are a vivid textbook for school legal education and the best material for legal research. The massive judgements made public by the people's courts are valuable judicial resources and the embodiment of the vivid practice of overall law-based governance. They are helpful for legal practitioners to study and research, as well as for the public to understand the trial work of the people's courts, anticipate the judgment results, abide by the law and avoid risks. 

With the continuous development of the economy and society, people's awareness of the rule of law has been further enhanced and their needs for justice have become more diversified and the expectations for judicial openness have also increased. For judges, it is both a challenge and a responsibility to issue written judgments, make them public online, and accept the public's supervision. People's courts will continue to promote the publicizing of written judgments and provide effective judicial services for advancing economic and social development. The specific measures are as follows:

First, by constantly advancing information technology for publicizing of written judgments, more intelligent and humanized services will be provided to all sectors of society. China Judgments Online website will be further upgraded and improved, making queries and retrieval more convenient for users and provide a friendlier interface, faster responses, and offer more intelligent and humanized services. We will optimize the automatic linkage among the first, second, and retrial documents of the same case. Based on retrieval results, the system will automatically list documents of relevant cases as well as related legal provisions. It will also prioritize both the documents of instructive cases and typical cases of the Supreme People's Court and list exemplary written judgments on the homepage of the website so as to better serve the general public.

Second, we will constantly strengthen the interpretation and reasoning of the written judgments so as to make them more authoritative. We will steadily promote the reform on judgment writing, which will refine the focus of disputes and spell out the main points of the court's judgments in plain language. We will classify the written judgments into complex ones and simple ones in accordance with the nature and trial-level of the cases. We will further intensify reasoning of written judgments for first-instance cases that contain disputes among parties, complicated legal relationships, or are of high public interest, all second-instance and retrial cases, as well as the cases that are discussed and decided by the judicial committee, so as to enhance their credibility.

Third, we will continue to deepen and explore the utilization of written judgments resources and promote data sharing, cooperation, and exchanges with other departments. We will continue to adhere to the principle of "big data, big pattern, and big service." We will also continue to explore, integrate, and utilize written judgments resources using broader means and at deeper levels in order to fully realize the potential value of judicial trial data resources. We will strive to make sure cases with similar scenarios and facts are approached in the same way and carry forward standardization of sentencing by analyzing massive data and provide important references for the scientific decision-making of the Party, governments and people's courts through in-depth analysis of the development trend of various disputes.

Those are my answers. Thank you.

CCTV News:

My question relates to a recent incident that concerns the rule of law, specifically, the predicament of long-term rental apartment brand Danke Apartment and the public concern it has caused. The operator of apartments defaulted on the landlords' rent, which led to many tenants being evicted. Some tenants also face default risks because they have paid their rent in advance with loans. We have noticed that statistical data online show several long-term apartment rental companies are found in similar breaches of contract as of late. What comments do the judicial authorities have on this? And what measures will be taken to safeguard the legitimate rights and interests of the relevant parties? Thank you.

Yang Wanming:

I would like to thank you for your concern for the judicial work. I have also seen the relevant media reports. As far as I know, local authorities and related departments are handling these issues in accordance with the law and regulations. If it becomes a legal case and enters the judicial process, people's courts will conduct the trial strictly in accordance with the law. The courts will take facts as the basis and law as the criterion and protect the legitimate rights and interests of the citizens and legal persons in accordance with the law. Thank you.

Hong Kong's Bauhinia Magazine:

Mr. Tang, what activities will be held in Hong Kong during this year's National Constitution Publicity Week? Could you introduce the exchanges and cooperation between the Chinese mainland and Hong Kong in the judicial field in recent years? Thank you.

Tang Yijun:

Thank you for your question. The Hong Kong Special Administrative Region (HKSAR) is an inalienable part of the People's Republic of China, and so, of course, the Chinese Constitution applies to the HKSAR. The Constitution and the Basic Law of the HKSAR together form the constitutional basis of the HKSAR. The Decision adopted at the Fourth Plenary Session of the 19th CPC Central Committee stressed that "education in regard to the Constitution, the Basic Law and China's national conditions, history and culture should be strengthened in Hong Kong and Macao, particularly among the civil servants and the young people, so as to improve national consciousness and the patriotic spirit of our compatriots in Hong Kong and Macao." The relevant departments of the Central Government have always strongly supported and actively cooperated with the HKSAR government and all sectors of society in organizing various forms of publicity and education activities concerning the Constitution and the Basic Law. This year, the HKSAR continued to carry out a series of publicity activities such as holding symposia to mark the National Constitution Day. This year's symposia were hosted for the first time by the HKSAR Government and a specific webpage was created. The Constitution has been promoted among primary and secondary school students in an all-round way. Recently, an online question-and-answer contest related to the National Constitution Day in 2020 was held to enhance student awareness.

In recent years, the exchanges and cooperation between the Chinese mainland and Hong Kong in the judicial field have been constantly deepened, which is mainly reflected in the following aspects:

First, judicial cooperation and exchanges have been gradually enhanced. In recent years, the Ministry of Justice has maintained and deepened communication with the Department of Justice, the Correctional Services Department, the Law Society, Association of China-Appointed Attesting Officers Limited, as well as other judicial and legal organizations and personnel in Hong Kong, and completed works related to judicial examinations for Hong Kong law students and their internships in the mainland, providing a guarantee for deepening collaboration on the rule of law in the Greater Bay Area.

Second, the policy of opening legal services has been steadily improved. In Jan. 2019, the Ministry of Justice and the Department of Justice of Hong Kong signed the "Minutes of the meeting on further deepening legal services cooperation between the Chinese mainland and Hong Kong", clarifying the new measures taken by the mainland to open its legal services to Hong Kong. This past August, the 21st Session of the Standing Committee of the 13th National People's Congress (NPC) adopted a decision by the NPC Standing Committee authorizing the State Council to carry out trials of Hong Kong and Macao legal practitioners acquiring mainland professional qualifications and practicing law in nine mainland cities within the Guangdong-Hong Kong-Macao Greater Bay Area. In October, the General Office of the State Council issued the measures for conducting these trails. At present, the Ministry of Justice is actively yet prudently promoting the relevant pilot work.

Thirdly, the interregional judicial assistance system has gradually taken shape. This year marks the 30th anniversary of the promulgation of the Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China and the 20th anniversary of the Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region being effective. The mainland and Hong Kong have creatively developed an interregional judicial assistance system with Chinese characteristics. The system has eight judicial assistance arrangements as the pillar and several judicial documents as the supplement, enriching the practice of "one country, two systems".

That's all. Thank you.

Hu Kaihong:

Because the time is limited, we will only be able to take one more question.

CRNTT:

The Civil Code will come into force on Jan. 1 next year. What work has been done in the study, publicity and implementation preparation of the Civil Code, please? Thank you.

Tang Yijun:

Thank you for your question. The study, publicity and implementation of the Civil Code is of great significance in building rule of law in China. The Ministry of Justice and the National Office for Law Popularization have made the study, publicity and implementation of the Civil Code a priority, and carried out relevant work in a swift and solid manner. We have advanced the work mainly from the following three aspects.

First, we have grasped the focus and incorporated the Civil Code into the general structure of the rule of law.

We take the implementation of the Code as an important task of deepening comprehensive law-based governance, and have integrated the implementation into the general plan of the latter. We also take the Code's implementation as an important tool to promote the construction of a law-based government, as a significant way to build a law-based society, and as a critical part of rule of law inspection work. We have integrated the Code's implementation into legislative work, law enforcement, judicial services, law observation and publicity, etc., promoting the formation of an efficient, balanced and coordinated work system for the study, publicity and implementation of the Civil Code.

Some time ago, the Commission for Overall Law-Based Governance of the CPC Central Committee organized a special inspection of local CPC committees and governments on their implementation of the Central Committee's decisions and plans for comprehensively governing the country in accordance with the law. We took the in-depth learning, publicity and implementation of the Civil Code as an important part of the inspection. Not long ago, we reviewed and evaluated the work of the Seventh Five-Year Legal Publicity Program. On the basis of organizing various departments in all localities to conduct self-examination, we carried out spot checks in some provinces (autonomous regions, municipalities), and one of the key contents of the checks was how the Civil Code was learned and publicized. These inspections and checks have strongly promoted the local departments concerned to accurately understand a series of new provisions, new concepts and new spirit of the Civil Code, and advanced the study, publicity and implementation of the Code across the country.

Second, focus on priorities to ensure the completion of key tasks.

Strengthening coordination. Eight departments, including the Ministry of Justice, the National Office for Law Popularization, and the Publicity Department of the CPC Central Committee, have jointly issued a circular on a campaign to study and promote the Civil Code. The campaign aims to help the people boost awareness of observing the law, develop a habit of turning to legal services when in trouble, and improve their ability to solve problems with legal knowledge. We urge central government departments to include the Civil Code into their list of duties for law popularization and to actively implement a program in which state law enforcement departments are responsible for strengthening public legal awareness.

Concentrating on major concerns. The popularization of the Civil Code should focus on responding to people's concerns and meeting public demands. We have organized officials of related departments to produce three open online courses on the Civil Code and published them online. We have made publicity films and posters, and promoted them in public places. We have also published handbooks containing quizzes and illustrations for the public to study the Civil Code. All local authorities, as well as relevant departments and agencies, have carried out publicity and education activities to promote the Civil Code in enterprises, in rural areas, in Party and government organs, on university campuses, in residential communities, at military camps, and online.

Innovating ways of promoting the Civil Code. We've taken a results-oriented approach to make the popularization of the Civil Code more effective and more relevant to people's daily lives. We launched a lecture series from the day the Civil Code was adopted, which includes 12 live-streamed lectures. It was proved to be very popular online, being viewed more than 10 million times on one platform alone. The book compiled from the lectures also found popularity among Party and government officials as well as the public. We organized a quiz on the knowledge about the Civil Code in the app "Xuexi Qiangguo," which has been taken by approximately 100 million people. We promoted the Civil Code through multiple media channels such as newspapers, the internet, apps, WeChat, Weibo, and TV, thus creating a positive atmosphere.

In the campaign to popularize the Civil Code, members of the Political Bureau of the CPC Central Committee have set a good example and ordinary people have taken an active role. Multiple media channels have been adopted and local authorities and communities have made concerted efforts. Thanks to various measures and effective coordination at different levels, the campaign has delivered fruitful outcomes in mobilizing more people to study, promote, and implement the Civil Code. General Secretary Xi Jinping emphasized the publicity of the Civil Code as a priority in the work of law popularization during the 14th Five-Year Plan period (2021-2025). The eighth five-year plan on raising public legal awareness will also be carried out from 2021 to 2025. We will increase efforts to popularize the Civil Code during the period and organize promotional activities to instill the spirit of the law.

Third, reinforce critical areas to ensure the implementation of the Civil Code.

First, enhancing scientific legislation. We are asking professionals to evaluate existing administrative regulations, rules, and normative documents, and to promote work regarding the enactment, revision, abolition, and interpretation of those inconsistent with the Civil Code. We will press ahead with enacting the supporting laws and regulations and improve our work in reviewing administrative regulations and normative documents to ensure that they conform with the Civil Code. We will accelerate our efforts to establish an institutional system with the Civil Code at the center, and resolutely uphold the uniformity, sanctity, and authority of China's legal system.

Second, strengthening law enforcement and judicial justice. In work regarding administrative rights determination, administrative licensing, administrative reconsideration, the execution of punishment, and compulsory isolation for drug rehabilitation, we will pay more attention to protecting the legitimate rights and interests of individuals, legal entities, and unincorporated organizations, as well as strengthen the protection of civil law rights. The administrative organs of justice will earnestly perform their duties of supervising and coordinating administrative law enforcement to ensure that the law is employed in a strict, procedure-based, impartial, and civil manner. We will handle administrative reconsideration cases in a timely manner, resolutely correct administrative agencies' violation of the parties' legitimate rights and interests, and safeguard people's rights and interests entrusted by the Civil Code in accordance with the law.

Third, improving public legal services. We will give full play to the role of professional legal institutions, including law offices, notarial institutions, and judicial expertise institutions in the appropriate application of the provisions of the Civil Code. We will make good use of multi-party dispute settlement mechanisms, such as people's mediation and arbitration. For civil disputes involving marriage, contracts, and inheritance, we will promote the role of mediation in their settlements and arbitration in accordance with the Civil Code. We will improve legal aid work and use the Civil Code to help people in need to protect their rights and interests so that they feel that justice is served throughout all legal services. Thank you.

Hu Kaihong:

Today's press conference ends here. Thanks to the three speakers. Thank you, everyone.

Translated and edited by Liu Qiang, Zhang Liying, Yan Xiaoqing, Huang Shan, Xu Xiaoxuan, Wang Zhiyong, Li Huiru, Wang Qian, Zhu Bochen, Wang Wei, Duan Yaying, Yuan Fang, Liu Sitong, Yang Xi, Zhang Jiaqi, David Ball, Tom Arnstein, and Geoffrey Murry. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers: 

Zhao Zeliang, vice minister of the Cyberspace Administration of China 

Zhu Guoxian, member of the Standing Committee and director of the Publicity Department of the CPC Zhejiang Provincial Committee 

Sheng Yongjun, secretary of the CPC Tongxiang Municipal Committee in Zhejiang province 

Chairperson: 

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office

Date: 

Nov. 2, 2020 

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to the State Council Information Office (SCIO) press conference. The World Internet Conference · Internet Development Forum will be held in Wuzhen, Zhejiang province, from Nov. 23 to 24. To brief you on progress, we have invited Mr. Zhao Zeliang, vice minister of the Cyberspace Administration of China, Mr. Zhu Guoxian, member of the Standing Committee and director of the Publicity Department of the CPC Zhejiang Provincial Committee, and Sheng Yongjun, secretary of the CPC Tongxiang Municipal Committee in Zhejiang province. They will explain the overall situation and the status of preparations for the forum and answer your questions. 

Now, I will give the floor to Mr. Zhao Zeliang. 

Zhao Zeliang: 

Thank you. Friends from the media, good afternoon. Welcome to today's press conference. The fifth plenary session of the 19th CPC Central Committee just concluded. Entrusted by the organizing committee of the World Internet Conference, I am delighted to brief you on the World Internet Conference · Internet Development Forum. 

The World Internet Conference · Internet Development Forum, with the theme of "Digital Empowerment Creates a Better Tomorrow: Building a Community with a Shared Future in Cyberspace," will take place in Wuzhen, Zhejiang province, from Nov. 23 to 24. During the same period, other activities including the Release of World Leading Internet Scientific and Technological Achievements in 2020, the Light of Internet Expo, and the "Straight to Wuzhen" Global Internet Competition, will also be held. 

The World Internet Conference has been successfully held for six years and has drawn great attention from the international community. Its influence has increased day by day. Since the beginning of this year, the COVID-19 pandemic has spread globally, and the international situation has undergone profound changes. In this context, it is particularly important to uphold the concept of a community with a shared future in cyberspace and strive to promote the development of global cyberspace towards a more inclusive, balanced and win-win direction. Given the changing situation and unchanged principles, we are actively exploring new models and new paths for organizing the World Internet Conference so as to show Chinese approach, wisdom and China's responsibility for advancing internet development and governance in a multifaceted and multi-dimensional way. 

Compared with previous years, there are three new changes in this year's forum. First, the format of the forum has been changed. We decided to hold the "World Internet Conference · Internet Development Forum" in the name of the World Internet Conference organizing committee, instead of organizing the 7th World Internet Conference. Second, the scale of the forum has been adjusted. Against the background of the COVID-19 pandemic, the number of guests, sub-forums and the conference duration have all been revised. The forum is expected to be "small-scale but significant" and "novel and lively." Third, there are new ways to participate. Various activities will be carried out on site and via video link. A live scene will be set up in Wuzhen, and guests who cannot attend the event in person will be able to participate online. 

While actively adapting to the changing situation and proactively innovating for changes, the style and principles of this year's World Internet Conference remain unchanged. 

First, it will focus on the theme and promote further cooperation. "Building a community with a shared future in cyberspace" has been a consistent theme of the World Internet Conference. The forum this year will fully implement General Secretary Xi Jinping's important thoughts on building China's strength in cyberspace, earnestly focus on General Secretary Xi's proposal to build a community with a shared future in cyberspace, and continuously establish a global platform promoting connectivity between China and the rest of world and a Chinese platform for global internet to be shared and governed by all. Under the principles of openness, equality, mutual trust, and win-win, we will work with the rest of the world to facilitate a global digital economy, promote economic recovery, and join hands with all parties to bring more vitality to the community with a shared future in cyberspace. 

Second, it keeps pace with new trends and aims to present creative ideas. Maintaining its high-end positioning, this year's forum will consist of one main forum and five sub-forums, providing platforms for exchanges of global, forward-looking, and strategic ideas, as well as leading and inclusive insights. Turning to content, high-end forums will continue to be held, including the "International Norms in Cyberspace: Practices and Explorations Forum," the "Belt and Road Forum for International Cooperation on Cyberspace," the "Artificial Intelligence Forum," and "Innovation and Breakthrough in Industrial Internet Forum." The "Youth and Digital Future Forum" will also take place to attract attention to the development and growth of the younger generation. Outstanding youth representatives will be invited to talk about the responsibilities and accountability of young people in the digital age. As for sideline activities, about 15 cutting-edge achievements of 2020 will be presented at the Release of World Leading Internet Scientific and Technological Achievements. The Light of Internet Expo will focus on the latest development trends and cutting-edge technologies of the internet around the globe and showcase world-leading and innovative technological achievements, products and applications. The "Straight to Wuzhen" Global Internet Competition will showcase the digital technology application in anti-pandemic efforts and internet innovation achievements. Ten teams with innovative projects from all over the world will compete in the finals, showing the vitality of innovation and entrepreneurship. 

Third, we will promote cooperation through concerted efforts. The forum will actively promote cooperation with international organizations, industry associations, technology communities, and global think tanks, pooling wisdom, bridging differences, strengthening mutual trust, facilitating more consensus and outcomes for building a community with a shared future in cyberspace, and further advance the goals set out in Wuzhen. In addition, the forum will also release the World Internet Development Report 2020 and China Internet Development Report 2020, which will comprehensively and deeply analyze the trend of internet development in the world and in China, and provide lessons and intellectual support for global internet development and governance. 

Dear friends, there are merely 20 days to go before the 7th World Internet Conference · Internet Development Forum opens. The preparatory work for the forum is now underway in an orderly manner as planned. We will strictly implement the requirements for regular epidemic prevention and control, and host a more distinctive and wonderful forum in a safe, frugal and efficient manner. 

Thank you. 

Shou Xiaoli:

Thank you, Mr. Zhao. Next, the floor goes to Mr. Zhu. 

Zhu Guoxian:

Thank you. Good afternoon, friends from the media. It gives me great pleasure to come to the press conference hall of the State Council Information Office once again a year on and brief you on this year's World Internet Conference · Internet Development Forum. On behalf of the Zhejiang provincial committee of the CPC and Zhejiang provincial government, I would like to take this opportunity to sincerely invite all friends, both old and new, to meet in Wuzhen for the grand gathering and discuss the new digital future. 

During his visit to Zhejiang this spring, General Secretary Xi Jinping set a new goal and new positioning for the province, that is, to strive to be an important window for representing the great strength of the socialist system with Chinese characteristics in the new era. The fifth plenary session of the 19th CPC Central Committee has made major decisions and arrangements for enhancing China's strength in cyberspace and digital technology. As a major province of internet development and digital economy, Zhejiang will use the opportunity to host the World Internet Conference to lead trends of the times, contribute to human progress, create a better life, and empower future development. 

Just now, Mr. Zhao briefed on the changes in relevant activities of this forum. As the host city, we will never change our philosophy of making each session better than the previous, nor will we change our firm faith in jointly building and sharing the internet and our unremitting pursuit to make people's lives better with the internet. 

We will continue to apply intelligent technologies in the conference and ensure it a safe and successful event. We will put people and their lives first throughout the preparation, strictly implement the requirements for regular epidemic prevention and control, make full use of our successful experience, and establish a prevention and control mechanism features full chain, full coverage and checklist management to realizes cientific prevention and closed-loop management. Guest registration, transportation, and conference services will adopt technologies such as non-contact face scanning, QR code passes, and infrared sensors to improve our intelligent services. Adopting the form of"online + offline", we will set up live broadcasting platforms and open an online expo. With the help of 5G, cloud computing, artificial intelligence, and other technologies, both online and offline activities will be presented simultaneously to holda smartand safe conference.

We will continue to keep to the right path and make innovations to present a concise but wonderful forum. The World Internet Conference has witnessed great changes amid the backdrop of the ancient town with a thousand years of history. We aim to make the forum a world internet conference that continues throughout the year. Those changes will promote further integration of the internet elements into the cultural genes of Wuzhen. A new exhibition will showcase the latest achievements in internet technologies worldwide on a regular basis. The country's first online and offline integrated public ecological park, which features new infrastructure and 5G plus intelligent interactive experiences, will be established. The park is designed to bea cloud agricultural experimental field, vividly displaying changes brought by the internet through immersive experiences and interactive scenes. Over 100 leading enterprises in the industry, including Alibaba, Tencent, Huawei, and Epson, will take part in the exhibition and present a batch of their latest scientific and technological achievements. Leading figures in the internet field in China and abroad will attend sessions of the forum or deliver a speech via video link, presenting a feast of ideas for internet-led changes. 

We will focus on how digital technologies have empowered the economy and make the forum a success. The previous six sessions of the World Internet Conference have offered strong driving forces to the digital economy of Zhejiang province and the development of the whole province. The province's GDP grew by 2.3% year on year in the first three quarters of 2020. The value-added of core industries of the digital economy increased by 14.4% year on year, making them the main engine of the province's economic growth, the major driving force in transformation and upgrading, and the main field in entrepreneurship and innovation. In particular, consumers who stayed at home during the epidemic have stimulated the development of the online economy. In the first three quarters, online retail sales through e-commerce in Zhejiang province reached 1.3968 trillion yuan, up 12.1% year on year. Meanwhile, online spending among residents in the province reached 719.4 billion yuan, up 9.1% year on year. Digital technologies are also profoundly changing Zhejiang people's daily lives.The public now enjoy increasingly better access to government services. The City Brain, a smart city platform aiming to improve urban management, has made cities smarter and life better. 

Friends from the media, Zhejiang will take this opportunity to study and implement the spirit of the fifth plenary session of the 19th CPC Central Committee, and faithfully implement the strategy to give further play to Zhejiang's advantages in eight areas and push forward measures across its eight aspects. We will strive to create an important  window, and be a good host for the grand event. We have the confidence to present you with a unique Wuzhen. Thank you again for your attention and support for Zhejiang. Let's meet in Wuzhen. Thank you. 

Shou Xiaoli:

Thank you, Mr. Zhu. Now, the floor is open for questions. Please identify your news outlet before you raise a question. 

CCTV:

The theme of this year's World Internet Conference · Internet Development Forum is "Digital Empowerment Creates a Better Tomorrow: Building a Community with a Shared Future in Cyberspace." What are the considerations behind this theme? Thank you. 

Zhao Zeliang:

Just as I mentioned in my introduction, "Building a Community with a Shared Future in Cyberspace" has been a permanent theme of the World Internet Conference. This year, the theme was specifically titled "Digital Empowerment Creates a Better Tomorrow: Building a Community with a Shared Future in Cyberspace." There are three considerations for this theme: 

First, we want the event to fully represent general global concerns as to what the future of the internet holds, reflect the power of the internet and other information technologies in preventing and controlling the COVID-19 epidemic and the restoration of social life, and display our resolute confidence in using digital technologies to respond to the challenges of the epidemic and in creating a better future. 

Second, we want the event to embody the spirit of openness and cooperation. We want to convey the message that China will work with the world to promote digital cooperation and make global cyberspace a more inclusive and balanced place and a place beneficial to all. 

Third, we want the event to embody China's wisdom and contributions in the promotion of internet development and governance and fully display China's sense of responsibility in promoting the building of a community with a shared future in cyberspace. 

Red Star News:

My questions are, how have you selected which world-leading internet, science, and technology achievements to highlight at this year's conference? And how is the global internet competition "Straight to Wuzhen" going? Thank you. 

Zhu Guoxian:

As an important part of the World Internet Conference, the global internet competition "Straight to Wuzhen" is a year-long international event that focuses on the digital economy. The 2020 event, based on its inaugural edition last year, has continued to solicit ideas from around the world, looking to projects representing new technologies, new models, and new business forms in the field of digital economy. By attracting the participation of many unicorn companies, to-be-listed companies, "black technology" companies, and capital both online and offline, the competition has become an important platform for matching digital economic resources and has further stimulated the innovation vitality of the World Internet Conference. 

Comprising an online preliminary round, an intermediary round, a semi-final, and a final, the event received participation applications from over 1,000 projects across 15 countries and regions this year. Over 800 of the projects then qualified for the preliminary online round. After the round, nearly 100 projects were selected for the intermediary round, which consisted of five intermediary competitions in China focused on the development of the Beijing-Tianjin-Hebei region, the Yangtze River Delta, the Belt and Road Initiative, the Guangdong-Hong Kong-Macao Greater Bay Area, and the Yangtze Economic Belt, as well as three overseas intermediary competitions held online in North America, Europe, and Asia-Pacific. In addition, there was a special competition category for digital technologies used for preventing and controlling COVID-19. Altogether, 27 projects, 18 from China and nine from overseas, made it into the semi-final, where they were further ranked by a panel of industry and investment experts who presented their marks through on-the-spot project reviews, as well a panel of advisors who voted online. Ten of the 27 projects made it into the final. 

The 10 projects cover a wide range of fields, including integrated circuitry, life sciences, information security, and flexible manufacturing and smart fishing, and epitomize innovation and entrepreneurship trends in the digital transformation of industries and the industrial transformation of digital technologies both in China and the world. The projects depict a new path for the future development of the digital economy. The type of technology involved can be divided into three main types: key and core technologies, digital technologies that empower traditional industries, and frontier technological innovations. 

The final will be held during the World Internet Conference · Internet Development Forum. I hope that friends from the media will continue to pay attention to the competition and bear witness to new driving forces of internet entrepreneurship and innovation. Thank you. 

Zhao Zeliang: 

I would like to add something about this year's release of the world-leading Internet scientific and technological achievements. The release is always an important part of the annual World Internet Conference (WIC). Despite the impact of COVID-19 this year, the quantity and quality of the filed achievements have increased and improved. By now, we have collected more than 300 achievements around the world. This year's activity features the following characteristics. 

First, it laid great emphasis on application. Focusing on the five application fields of industrial recovery and coordinated development, digital social governance, global public crisis response, artificial intelligence and cloud life, and green digital public welfare practice, the activity explored global Internet innovative products and key technologies regarded as capable of promoting development and benefiting humanity. 

Second, it laid emphasis on representativeness. Among this year's collection, there were achievements from centrally-administered State-owned enterprises (SOEs)  such as CETC, China Telecom, China Unicom, China Mobile and China Electronics Technology Group Corporation, from famous Chinese IT and Internet enterprises such as Huawei, Alibaba Group and Tencent, and also from renowned international enterprises including Microsoft and Kaspersky. 

Third, it laid emphasis on technology and innovation value. This year's collection covered various categories including quantum computing, satellite-based Internet, artificial intelligence, high-end chips, 5G network architecture and applications, as well as various application scenarios such as smart city, intelligent transportation, telemedicine and online education. 

In accordance with the principles of "fairness, impartiality, objectivity and authority", the Recommendation Committee for World Internet Leading Scientific and Technological Achievements was established. Wan Gang, vice chairman of the National Committee of the CPPCC, chairman of the Central Committee of the China Zhi Gong Party and president of the China Association for Science and Technology (CAST), acts as honorary president. Leading Internet experts from China and Germany act as respective directors, so as to guarantee the authority and impartiality during the process of recommendation and evaluation. As for the final result, I'm looking forward to it as much as you are. Let's meet in Wuzhen. Thank you. 

Economic Daily: 

We have noticed that, in recent years, the Zhejiang sub-forum of the WIC has always been themed on innovation and breakthroughs of the industrial Internet. Zhejiang is a manufacturing powerhouse and a major province in regard to digital economy. Could you please give us a brief introduction about the development of the industrial Internet in the province? Thank you. 

Zhu Guoxian: 

Thank you for paying attention to Zhejiang's industrial Internet. At the 4th WIC in 2017, Zhejiang provincial government and the MIIT signed a cooperation agreement to jointly promote development of the industrial Internet, and jointly establish its supporting network, platform and security systems. After more than three years of effort, development in the province has moved into the fast lane. According to a report on China's digital development released by the Cyberspace Administration of China last year, Zhejiang ranked first in the industrial digitalization development index. 

As I mentioned previously, Zhejiang's GDP in the first three quarters increased by 2.3% year-on-year, and the development of the industrial Internet contributed a great deal. Zhejiang is making efforts to build a "1+N" platform system of the industrial Internet. "1" refers to the supET platform selected in the list of the country's top 10 cross-industry and interdisciplinary platforms, and honored as a world leading Internet scientific and technological achievement. "N" means to establish a batch of multi-level and systematic N-level platforms with high quality covering 10 iconic industrial chains, and 17 key traditional manufacturing industries and major industrial clusters. By doing so, we will preliminarily achieve the development target of "building one key platform for one industry, and one key platform for one field."

By the end of this year, the "1+N" platform system in the province is expected to connect with 50 million pieces of industrial equipment, serve more than 100,000 industrial enterprises, and develop more than 30,000 integrated industrial APP applications. Since Zhejiang features well-developed industrial clusters and has many SMEs, we explored and formed a business model enabling the platforms to help service providers, and the service providers to serve SMEs. The model has multiplied the service ability of industrial Internet platform, and promoted the digitalization transformation of SMEs on a large scale. In the first half year, thanks to the industrial Internet platform, we have supported a large number of enterprises to quickly resume production and work, matching supply and demand, providing material support, accelerating social production and operation to return to normal, and strongly supporting economic and social development as well as epidemic prevention and control. 

Next, fully utilizing the dividends of the WIC and giving full play to Hangzhou's innovative technological application and Ningbo's advanced manufacturing, Zhejiang will form a development architecture of industrial Internet with Hangzhou and Ningbo as the dual-core and other cities developing in a coordinated way. We will widen and deepen the integrated application of the industrial Internet, and strive to build a national demonstration province in this regard. Thank you. 

Radio Television Hong Kong:

Just now, Mr. Zhao said that the cyber power was an important idea of this conference. As we know, the communique released after the fifth plenary session of the 19th CPC Central Committee mentioned that, according to the proposals for the 14th Five-year Plan (2021-2025) for National Economic and Social Development and the Long-Range Objectives Through the Year 2035, China would build its cyberspace strength and promote the development of real economy in the future. Mr. Zhao, could you explain some future schemes or specific plans in this regard? Thank you. 

Zhao Zeliang:

Thank you for your question. You asked what plans we had to build China's cyberspace strength. Well, this is a question that we have been thinking about and should answer. General Secretary Xi Jinping put forward the important thoughts on building China's strength in cyberspace and the fifth plenary session of the 19th CPC Central Committee proposed important objectives and tasks of constructing a cyber power. Learning and putting into practice General Secretary Xi Jinping's important thoughts as well as implementing the guiding principles of the fifth plenary session in this regard is a critical task of China's current cyber and information work.

Our perception is that in order to study and achieve deep understanding of General Secretary Xi Jinping's important thoughts on building China's strength in cyberspace and implement the relevant tasks proposed by the fifth plenary session, we must first achieve top-level design and planning. This includes a top-level design of China's cybersecurity and IT application work, international cooperation in cyberspace, and vigorous strengthening of cybersecurity systems. We should also give full play to the potential of the internet and other information technologies to benefit mankind and meanwhile minimize their negative effects on and possible harm to society and people. Take the internet application for example – I see that so many of you journalists are holding mobile phones. How can we protect personal information and privacy, and ensure the safety of key infrastructure? These are the issues our cybersecurity work needs to answer and settle. We should forcefully promote IT applications with regard to the internet. Just now I said that satellite internet, quantum computing, high-end chips, and artificial intelligence (AI) were involved in this year's release of leading internet scientific and technological achievements. We need to apply these technologies into all aspects of social life and economic development and further give play to the role of information technology. We need to advance international cooperation in cyberspace as well, which constitutes an important task of Internet development forum in Wuzhen this year. In short, at present and in the future, it is a significant historical mission for personnel working in the cyberspace and information sector to fully implement General Secretary Xi Jinping's important thoughts on building China's strength in cyberspace and to work to accomplish the targets and tasks of the fifth plenary session. Thank you again for your question. 

China Daily:

We noticed that the CPC Zhejiang Provincial Committee held a symposium on the 15th anniversary of the implementation of the Zhejiang cultural research project some time ago and proposed a full implementation of the Cultural Zhejiang for a New Era. My question is—how will Zhejiang province use the platform of the World Internet Conference to better display and promote Zhejiang's culture? Thank you. 

Zhu Guoxian:

Thank you for your attention to Zhejiang's cultural development. We place high hopes for Zhejiang to make good use of the World Internet Conference to further promote its culture. At the symposium on the 15th anniversary of the implementation of the Zhejiang cultural research project held on September 21 of this year, Yuan Jiajun, secretary of the CPC Zhejiang Provincial Committee, proposed that we should strive to succeed in eight aspects: upholding the innovative theories of the Party, embracing core socialist values, cultivating people's characters and temperament through culture, stressing honesty and good faith, producing high-quality cultural works, combining cultural development through big data and AI, integrating cultural industry with other relevant industries, and advancing cultural reform. Through these, we can bring forward the project of the Cultural Zhejiang for a New Era, faithfully implement the "Double Eight Strategy" (referring to the eight strengths Zhejiang possesses in terms of system and mechanism; geological position; industry; coordinated development of urban and rural areas; ecology; mountain and ocean resources; environment; and culture, as well as eight measures the province is taking to take further advantage of these strengths), and build Zhejiang into an important window to fully demonstrate the cultural development in a new era.

The World Internet Conference serves not only as an important platform for the display and exchange of internet-related technological achievements but also as a stage for communication and mutual learning between various cultures. I have some examples for you. First, the town of Wuzhen itself is a shining example of Zhejiang culture. In Wuzhen, where the thousands-year-old Beijing-Hangzhou Grand Canal passes, there are well-preserved cultures unique to the ancient towns south of the Yangtze River and legacies left by renowned historical and cultural figures such as Mao Dun and Mu Xin. Wuzhen is imbued with culture, and Zhejiang's rich and profound culture is well reflected in this town.

Second, the site of the World Internet Conference is where Zhejiang's history and modernity enrich each other. The landmarks of the conference, including the Internet International Conference and Exhibition Center, the Yunzhou Guest Service Center, and the Light of the Internet Expo Center, embody the unique cultural elements of Zhejiang, echoing and integrating the traditional architectural styles of water town in Wuzhen. Volunteer uniforms are designed based on Wuzhen's water, bridges, walls, tiles, and other distinct features, brimming with a rich cultural flavor unique to Zhejiang. In addition, the annual Wuzhen Theatre Festival offers the World Internet Conference more Zhejiang cultural touches. The World Internet Conference constitutes an important window into Zhejiang's cultural innovation and development. For example, every year's Light of Internet Expo sees the release of leading internet, scientific, and technological achievements from Zhejiang enterprises, promoting the idea of "Intelligent manufacturing in Zhejiang." At all World Internet Conferences, we have carefully planned intelligent experience projects such as remote driving of unmanned vehicles, smart vendors, and 5G patrol robots, etc., so that advanced technologies can be first tested in Wuzhen, and a technological and digital Zhejiang can be shown in its clearest and most vivid fashion via the World Internet Conference platform. Meanwhile, the conference has also enabled Zhejiang culture to ride on the wings of the internet to achieve better development and prosperity. Thank you. 

China Review News:

Which global enterprises and organizations will be invited to attend this year's WIC? How will they be taking part in the conference? Thank you. 

Zhao Zeliang:

This year's Internet Development Forum continues to maintain a high-end positioning, inviting important guests from government departments, international organizations and leading enterprises within the internet field, as well as top academics, to take part in the forum in various ways. Among them, Turing Prize winners, Nobel Prize winners and Internet Hall of Fame inductees have all been invited. The number of guests attending this year's meeting in-person may be limited due to the pandemic situation. We will give full play to the communication advantages of the internet and allow more people participate online. For example, the Release Ceremony for World Leading Internet Scientific and Technology Achievements, the Youth and Digital Future Forum, the Innovation and Breakthrough in Industrial Internet Forum and other events are all being broadcast live online. People can watch these activities online through various platforms. We will also publish the speeches and opinions of guests through videos and pictures on the WIC's official website and other relevant platforms. This will facilitate continued participation and allow people to watch after the conference has ended. Thank you. 

www.CQCB.com:

Tongxiang has become the permanent host city of the WIC. What role has the internet played in Tongxiang's handling of the pandemic? Thank you. 

Sheng Yongjun:

Thank you very much for your question. The internet has played an irreplaceable role in Tongxiang's handling of the pandemic this year. Great achievements have been made following the motto "Both hands must be hard and both battles must be won," referring to the prevention and control of the pandemic situation and the resumption of work and production. These achievements have benefited from the results of the conference, which helps Tongxiang greatly improve its construction of a smart city. These achievements have benefited from the implementation of the concept of "integrated intelligent governance" and "practicing values of loyalty and honesty and being dared to break through difficulties." These achievements have also benefited from the cultivation of internet thinking models among the majority of cadres and the public after the permanent settlement of the conference in Tongxiang. I have been most impressed by three aspects: 

First, the internet has allowed for more accurate prevention and control of the epidemic. The use of precise intelligent controls has allowed for favorable, orderly and effective conditions. Before the popularization of the "Health Code," we developed and promoted the "Tongxingtong" app. Compared with the "Health Code," the "Tongxingtong" app has more functions, allowing users not only to gain admittance by code, but also to enjoy the convenience of "one code for all," marking its iterative upgrading from intelligent controls to governance and service, and its continuous extension to social management, life services and big data application fields. More importantly, it has a unified online command platform, which can achieve linkages with a single code, visualization with one picture, coverage on one network and unified management. With the help of the internet, the whole of society has been able to travel smoothly, carry out operations in an orderly manner and receive general satisfaction. 

Second, the internet has allowed a more efficient resumption of work and production. In order to restart work and production faster and more effectively, we used the internet to solve three difficulties. First, we solved the difficulty of attracting investment. Through online negotiation and cloud contract signing, we managed to continue introducing talents and attracting investment. In February, when the situation was at its most severe, we signed 27 projects with total investment of 16.2 billion yuan. Foreign investment in the first three quarters of this year has managed to grow in contrary to trends. Contracted foreign investment increased by 56 percent year on year, actual foreign investment increased by 20 percent year on year, and domestic investment from outside the city achieved 124 percent of the tasks for the whole year. In addition, 12,000 college graduates have been recruited, representing a year-on-year increase of 55 percent. Second, we solved the difficulty of production and marketing. Under the framework of "unblocking domestic circulation and promoting domestic and international dual circulation," we realized the effective connection of market chains and industrial chains. Taking online retail as an example, we alleviated the impact of the epidemic on the real market by opening up online markets. From the first to the third quarters of this year, we achieved a total of 29 billion yuan in online retail sales, a year-on-year increase of 20 percent. Third, we solved the difficulty of returning to work. In order to solve the labor shortages caused by the epidemic, we vigorously promoted "machine substitution " and industrial internet applications. So far, nearly 10,000 industrial robots have played important roles in the city. The production efficiency of enterprises has been improved, and labor shortages have been effectively eased. The integration index of industrialization and informatization is also constantly improving, and Tongxiang is more worthy of its title as a "national demonstration city for the integration of the two modernizations." In the field of agriculture, we have vigorously promoted "field nannies" with intelligent management and protection as their main features, enabling data-led agriculture . A bumper harvest is now in sight. 

Third, the internet makes people's lives more convenient. We have very deep feelings in this regard. We pushed forward the reform of a "one-stop service model" and managed to allow all items in the "whole lifecycle" of individuals and enterprises to be dealt with online. Through online classes, 110,000 teachers and students across the city continued their studies at home during the epidemic. With the establishment of the "internet plus medical service" system and the wider application of remote surgery and online diagnosis and treatment, people can now enjoy high-quality medical services at home. In addition to smart government, smart education and smart medical services, we have made great progress in smart city governance, smart traffic, smart elderly care and future communities, thus making the city more intelligent and more people-centered. 

In summary, the epidemic has clearly shown us just how closely connected the internet is with people's work and lives. Party committees and the governments should follow the trends of the times, act to seize the opportunity amid the crisis and blaze a new path through the turbulent situation. The World Internet Conference (WIC) is a platform to link China and the rest of the world - an interconnected world shared and governed by all. As Tongxiang is the permanent host city of the WIC, we will live up to the great trust placed in us and firmly follow the overarching concept of smart governance guided by the pioneering spirit of the red boat, putting loyalty and a pioneering spirit first, and achieving good results through good methods. We will ensure that richer internet application scenarios are promoted, and will help digital industries, which have the greatest innovative momentum, to prosper. We will ensure the future of the internet in Tongxiang and Wuzhen. Thank you. 

Shou Xiaoli:

And now for the final question. 

Guangming Daily:

The blue books issued each year during the WIC are an important outcome and are widely followed. What topics do this year's blue books cover and what innovations are there compared with previous years? Thank you. 

Zhao Zeliang:

Thank you for your question. As you just mentioned, every year we release two blue books during the WIC: the World Internet Development Report and the China Internet Development Report. This year's internet development forum also plans to release the "World Internet Development Report 2020" and the "China Internet Development Report 2020." The "World Internet Development Report 2020" will mainly introduce the general trends within global internet development and the situation regarding internet development in major countries, and will focus on showcasing the latest technologies, applications and developments in the global internet, and the outlook of its developing trends. 

In the "China Internet Development Report 2020," we thoroughly put into practice General Secretary Xi Jinping's thoughts on building China's strength in cyberspace. We have comprehensively assessed the development of the internet in provinces and cities nationwide. We have focused on the achievements and the latest progress of China's internet development, especially the essential role and great contribution of China's internet during the COVID-19 epidemic, to present how China's cyber and information sector has improved the quality and efficiency of its regional and national economies. We will profoundly interpret China's thoughts, visions and positions in its commitment to build a peaceful, secure, open, cooperative and orderly cyberspace. 

Shou Xiaoli:

Thank you to all our speakers and friends from the media. That concludes today's press conference. Thank you. 

Translated and edited by Lin Liyao, Zhang Junmian, Xiang Bin, Zhou Jing, Liu Jianing, Li Huiru, Yuan Fang, Wang Qian, Wang Wei, Wang Yiming, Yang Xi, Zhang Jiaqi, Xu Xiaoxuan, Wang Yanfang, Laura Zheng, David Ball, and Geoffrey Murry. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Yu Xuejun, member of the Leading Party Members' Group and vice minister of the National Health Commission (NHC)

Mao Qun'an, director of the Department of Planning and Information of the NHC

Chairperson:

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office

Date:

Oct. 28, 2020

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to the press conference of the State Council Information Office (SCIO). During the 13th Five-Year Plan period (2016-2020), remarkable progress has been achieved in the reform and development of China's health sector. Today, we are pleased to be joined by Mr. Yu Xuejun, member of the Leading Party Members' Group and vice minister of the National Health Commission (NHC), and Mr. Mao Qun'an, director of the Department of Planning and Information of the NHC. They will brief you on the reform and development of China's health sector during the 13th Five-Year Plan period and answer your questions. First of all, I would like to invite Mr. Yu to make his opening statement.

Yu Xuejun:

Thank you, Ms. Shou. Friends from the media, good afternoon.

The 13th Five-Year Plan period has played a decisive role in achieving the first centenary goal of building a moderately prosperous society in all respects, and has been crucial for the development of public health sector in China. Committed to the philosophy of people-centered development, the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core made the decision to carry out the Healthy China initiative and set out the principles for the CPC's public health work in the new era. During this period, the CPC Central Committee and the State Council convened the National Health and Fitness Conference and issued the "Healthy China 2030 Planning Outline; the National People's Congress adopted the Law on Basic Healthcare and Health Promotion and the Law on Traditional Chinese Medicine (TCM). These efforts have ushered in a new stage for implementing the Healthy China initiative and promoting health for all. 

Under the strong leadership of the CPC Central Committee and the State Council, the NHC has made every effort to implement the Healthy China initiative and shift the focus on health care from treating illnesses to improving people's health. From 2015 until the end of 2019, the average life expectancy in China rose from 76.3 years to 77.3 years, an increase of one year within this four-year period. The maternal death rate, infant mortality rate and under-five mortality rate declined from 20.1 per 100,000, 8.1‰ and 10.7‰ to 17.8 per 100,000, 5.6‰ and 7.8‰, respectively. The main health indicators for Chinese people are generally better than the average level in middle- and high-income countries. The proportion of personal spending in China's total expenditure on health fell to 28.4%. The implementation of the Healthy China initiative has got off to a good start.

First, the Healthy China initiative was launched and implemented with joint efforts for shared benefits. The State Council issued guidelines for the initiative's implementation and established a promotion committee. A total of 15 special campaigns were launched to deal with factors influencing health, to protect full-life-cycle health, and to prevent and control major diseases. People generally now have greater health awareness and take more action to improve their fitness. The patriotic sanitation campaign was further deepened and the China Healthy Cities and Towns Initiative was launched nationwide. The idea of personal responsibility in health matters was reinforced. Health awareness in both urban and rural areas rose to 19.17% in 2019 from 10.25% in 2015, and this figure is expected to have doubled during the 13th Five-Year Plan period by the end of this year.

Second, the medicine and health care system was enhanced while overcoming difficulties, and a general framework for systems with Chinese characteristics for providing basic health care was established. Coordinated medical services, medical insurance and pharmaceutical reforms continued. We moved forward across the board with the comprehensive reform of public hospitals and ended drug price markups in public hospitals. We launched trials for modern hospital management and promoted a performance assessment system which emphasizes quality and public benefits. We improved incentive mechanisms in terms of salaries and professional titles for medical staff working at the community level. We advanced the development of health care consortiums and the comprehensive reform of county-level public hospitals to make quality medical resources more accessible within communities. Rates of participation in the basic medical insurance systems stood at above 95%. The number of essential medicines increased from 520 to 685. We pressed ahead with centralized procurement and usage of medicines, and the prices of selected medicines in a pilot program dropped by more than 52% on average. This has helped solve the "last mile problem in making medicines at lower prices more available for clinical practice in hospitals. We improved the comprehensive regulatory system of the health sector and promoted the development of private hospitals and health-related industries in a well-regulated manner. All these efforts are aimed at meeting people's diverse health needs.

Third, continuous improvements were made in the health care service system, and services have become more accessible. We optimized the distribution of medical resources by starting the construction of national and regional medical centers and improving county-level health care service systems. A total of 84% of county-level hospitals qualified for designation as hospitals at or above the level of grade two. From 2015 to 2019, the number of general practitioners increased from 1.38 to 2.61 per 10,000 people; the number of beds in medical and healthcare institutions increased from 5.11 to 6.3 per 1,000 people; and the number of occupational physicians and physician assistants rose from 2.22 to 2.77 per 1,000 people. The number of registered nurses reached 3.18 per 1,000 people in 2019, compared with 2.37 per 1,000 people in 2015. Nearly 90% of households are now less than 15 minutes from a medical institution.

Fourth, we have made efforts to ensure that rural poor people have access to basic medical services. The health and medical assistance program for poverty alleviation has achieved notably effective results. We focused our efforts on three aspects, namely, health service capacity building in county hospitals; integrated management of health personnel in medical institutions at a county and township level, as well as at a township and village level; and the standardization of township health centers and village clinics. We also ensured that qualified county-level hospitals in poverty-stricken counties have been incorporated into the National Health Security Project and organized medical teams from Grade III (top-level) hospitals to assist county-level hospitals in poverty-stricken counties. A telemedicine service system has been put in place to cover all the national-level impoverished counties and remote areas. The list of diseases covered by a special aid and treatment program for rural poverty-stricken populations suffering from serious illnesses has been expanded to 30 types. The country has provided categorized treatment to over 19 million poverty-stricken people. Nearly 10 million families across China who fell into the clutches of poverty due to illness have shaken off their state of destitution.

Fifth, the level of equal access to basic public health services has been further enhanced, advancing the overall strength of public health in China to a new stage. Annual per-person government subsidies for basic public health services were raised from 40 yuan in 2015 to 74 yuan this year. The national basic public health service program has provided 14 categories of services for free to all urban and rural residents. We also improved major infectious disease control measures, implemented a three-year action plan for the critical battles against occupational and endemic diseases, further expanded the scope of the national immunization program, and ensured the program for early diagnosis and early treatment of cancer to cover more people. In 2019, the rate of premature deaths from major chronic diseases was reduced by 10.8% compared with that in 2015.

Sixth, the management of maternity and child care and family planning services has been further enhanced. The method of healthy aging has been actively promoted. We made changes to our birth policy in an orderly way to improve it. In 2019, 59.5% of China's newborn babies were not the first child in their respective family. Meanwhile, we improved relevant coordinated policies to advance care services for infants under three-years-old. We also comprehensively strengthened and integrated the prevention and treatment of birth defects and piloted screening, diagnosis and rehabilitation for five categories of disabilities among children. Moreover, we enhanced old-age health education, prevention and healthcare services and promoted combined medical and care services for the elderly. More than 40,000 institutions have provided medical assistance to senior citizens who opt to stay at home. All Chinese over 65 years old have been provided free annual physical examinations.

Seventh, we have improved policies and mechanisms that will further unleash vitality. New advances have been made in the preservation and innovation of traditional Chinese medicine (TCM). The CPC Central Committee and the State Council issued guidelines to promote the preservation and innovative development of TCM. The State Council held a national TCM conference. As a result, improvements have been achieved in all respects including the service system building of TCM, training of TCM professionals, technological innovation, and the quality of TCM. There are currently more than 65,000 TCM institutions across the country, providing diagnosis and treatment to about 1.16 billion people annually. TCM and Western medicine have different strengths, while complementing each other with advantages. They work together to protect people from diseases and improve public health.

The ongoing fifth plenary session of the 19th Communist Party of China Central Committee is mapping out a national development blueprint for the 14th Five-Year Plan period, as well as for a longer-term vision for 2035. The meeting will also make up a systematic plan to comprehensively deepen the implementation of the Healthy China initiative. We will earnestly apply the guiding principles of the fifth plenary session of the 19th CPC Central Committee, implement our tasks in a targeted way, and strive to provide comprehensive lifecycle health services to our people to ensure better health for them.

That's all for my introduction. Now, my colleagues and I are ready to take your questions. 

Shou Xiaoli:

Now, the floor is open for questions. Please identify your news outlet before you raise the question. Let's begin.

CNR:

During the period of COVID-19 epidemic prevention and control, people have keenly realized that public health events are closely related to people's health and safety. What measures have been taken to improve the public health system in the 13th Five-Year Plan period? And what progress has been made? Thank you.

Yu Xuejun:

Thank you. This is a very important question.

The public health situation in the 13th Five-Year Plan period is very complex due to the threat of multiple diseases and the existence of multiple health-affecting factors. During this period, the CPC Central Committee and the State Council have made it a major goal to modernize China's governance system and capacity to build a stronger public health service system that can promptly and properly handle the sudden outbreak of a major infectious disease or the emergence of a new major infectious disease. It is stressed that emphasis should be put on prevention, prevention and control should be strengthened at the earliest stage possible, and prevention should be combined with treatment so as to provide safe, convenient, and inexpensive public health and basic medical services for the public. In implementing the decisions and plans of the central authorities, the National Health Commission (NHC) has deepened understanding of the public health governance concept, improved strategies for the prevention and control of major diseases, and taken concrete measures to strengthen the public health system. In 2016, the NHC, together with the National Development and Reform Commission (NDRC) and the National Administration of Traditional Chinese Medicine (NATCM), released the "National Health Protection Project Development Plan", in which the building of public health service capacity was listed as a key area of support during the 13th Five-Year Plan period. From 2016 to 2020, the government arranged 141.5 billion yuan, up 23 percent since the 12th Five-Year Plan period, from the central budget to invest in more than 8,000 public health projects such as the construction of disease control and prevention centers. A public health service system has been established that has professional public health institutions, including institutions for disease prevention and control, emergency treatment, and health supervision, as its backbone. The system works with the support of various types of medical institutions at all levels, makes good use of community medical institutions, and covers and involves the participation of everyone.

This year, NHC, NDRC and NATCM issued the Public Health Prevention, Control and Treatment Capacity-Building Plan to further modernize the disease control system, upgrading the treatment capacity of county-level hospitals and improving the urban infectious disease treatment network. We are now advancing the construction of national major epidemic treatment bases and pilot projects to transform public facilities for both peacetime and wartime purposes in an orderly manner. All this has laid a solid foundation for improving basic public health services and effectively responding to public health emergencies. 

During the 13th Five-Year Plan period, China successfully responded to outbreaks of H1N1, H7N9, and the Ebola hemorrhagic fever, and the incidence of major infectious diseases dropped significantly. The response to the once-in-a-century COVID-19 epidemic is an overall test of the effectiveness of our national public health system. General Secretary Xi Jinping pointed out that the fight against COVID-19 shows that China's public health service system, medical service system, medical security system, drug supply system, and major epidemic prevention and control and emergency management system are generally effective, but that there are also weaknesses.

During the 14th Five-Year Plan period, we will strive for more precise and effective prevention while addressing deficiencies, loopholes and weaknesses together with relevant departments in line with the direction and requirements the central authorities have set for the reform of the public health system. We will make greater efforts to improve institutions, clarify functions, strengthen monitoring and early warning, and improve the competence of relevant personnel. With this we endeavor to build a strong public health system that can effectively safeguard the people's health. Thank you.

Thecover.cn:

In recent years, the facilities and working environment of community medical institutions have greatly improved, but the lack of professionals is still a severe handicap for them. What measures have been taken during the 13th Five-Year Plan period to improve the situation? How effective have the measures been? Thank you.

Yu Xuejun: 

Thank you for your question. Qualified medical professionals are the foundation for building a healthy China and an important guarantee for better community services. During the 13th Five-Year Plan period, the NHC took a variety of robust measures to improve the number and competence of medical professionals working at the community level. I would like to inform you of the work done in several areas.

First, we have trained medical professionals for community medical institutions through our medical education system, which is comprised of college education, post-graduation education and continuing education. We have established a unified national system to standardize the training of resident doctors. The purpose is to cultivate qualified clinicians under the same standards, and the system has helped train a large number of medical college graduates who have gone to work at township health centers in central and western China as agreed before. We have also taken a series of measures to guide the flow of medical professionals, including ones to pair up urban and rural medical institutions for the former to support the latter, to encourage college graduates to work at community medical institutions, to require urban doctors to work at community institutions before getting a promotion, and to send 10,000 doctors to support rural health projects. In recent years, the proportion of medical professionals holding intermediate and senior professional titles at community institutions has continued to increase, and the structure has been further optimized.

Second, we have encouraged registered doctors to work for multiple medical institutions so that medical professionals can provide health care services at the community level. During the 13th Five-Year Plan period, we established a regional registration system for doctors. We revised and issued the Administrative Measures for the Registration of Practicing Medical Doctors, which changes "place of practice to "provincial and county-level administrative division of the location of the medical, prevention or health care institution where a medical practitioner practices. After registering, doctors can work for multiple medical institutions within the registered provincial and county-level administrative regions. They only need to register at their main working institution and then file the records if they practice medicine in other places. At present, there are 260,000 doctors practicing in multiple institutions across the country, effectively alleviating the shortage of medical personnel in community-level medical institutions and private hospitals.

Third, we have increased training for doctors to bring professionals to community-level institutions. We have issued guidance to promote the coordinated reform of the national doctor training and incentive mechanism, and conducted research and formulated outlines for the training of general practitioners in job transfers. Beneficial policies were introduced to support doctors to participate in the general practitioner job transfer training program. Trainees from poverty-stricken areas, ethnic minority areas, and old revolutionary base areas will be given priority in hiring under the same conditions. During the training period, the pay package for trainees is guaranteed. After passing the training examination, their scope of practice as a general practitioner will be expanded. At present, 180,000 people have taken part in the general practitioner job transfer training. The number of general practitioners per 10,000 people has increased from 1.38 in 2015 to 2.61 this year.

Fourth, we have improved the competence of community-level professionals through special training. Since 2018, we have implemented competence improvement training projects for physicians, nurses, management staff, and village doctors working in township hospitals and community health service centers to help them hone their skills. As of 2020, the central government has invested a total of 1.02 billion yuan into the training of more than 500,000 health workers at the community level.

At present, the total amount of high-quality medical resources in China is insufficient, and the distribution of medical resources between urban and rural areas is still uneven. In particular, we still face a shortage of professionals. In the future, we must continue to boost the talent pool and enable medical professionals to better provide health care services for people. Thank you.

People's Daily:

This year marks the final year for China to achieve its goal of eradicating poverty. Raising standards of health is an important way of lifting people out of poverty. What specific measures has China taken in terms of alleviating poverty by improving health standards? Thank you.

Yu Xuejun:

I will answer this question. We all know that poverty alleviation is one of the three critical battles. Reducing poverty by improving health standards is a key to winning the battle against poverty. The goal becomes more harder to achieve the closer we get to it. The NHC regards reducing poverty by improving health standards as an important foundation for our implementation of the healthy China initiative and the rural revitalization strategy, an important task in the reform and development of health care, and an important means to address areas of weakness. Focusing on the goal of ensuring basic medical care for the poor, we have introduced and implemented targeted policies to achieve the goal of ensuring the poor population are covered by the health care system and have access to doctors and hospitals.

First, we have emphasized improving the capacity of medical and health services in poor areas. Addressing the problem of no medical or health institutions and personnel in rural poor areas, township and administrative village is a historical achievement. We have worked to ensure that every poverty-stricken county has at least one public hospital, and every township and administrative village has at least one health center and clinic equipped with qualified doctors. Grade-III hospitals were paired-up with hospitals in poverty-stricken counties to provide assistance. Major headway has been made in promoting the capacity building of county-level hospitals, the construction of the "county and township integration, township and village integration mechanism, and the construction of rural health care institutions.

Second, we have made up for the shortcomings of public health services. We have promoted the comprehensive prevention and control of infectious diseases and endemic diseases. Efforts to promote the comprehensive prevention and control of major infectious diseases and endemic diseases such as AIDS, tuberculosis and echinococcosis, have delivered historic results. The health standards of people living in impoverished areas have also significantly improved. Together with the National Development and Reform Commission (NDRC), we have successively issued technical guidelines for the construction of adaptable and convertible wards, fever clinics, and laboratories of medical and health institutions in general hospitals that can cope with an epidemic. All projects in poverty-stricken areas that meet the necessary requirements have been included in the scope of financial support from the central government.

Third, we have effectively ensured that the poor population has access to basic medical and health services. A condition-specific and category-based approach has been applied to the medical treatment of patients. Adopting this approach, we have treated more than 19 million poor patients and continued to provide health services for key groups. We have worked to ensure that all poor people in need can be relocated, covered by health care and receive treatment. For registered poor households, the proportion of out-of-pocket payments of health care expenses has been reduced to about 10%. We have established a monitoring and early warning mechanism that can timely locate people in need, give targeted treatment, follow up and effectively ensure their health, and prevent them from falling into poverty or returning to poverty due to illness. As I just mentioned, we have successfully lifted nearly 10 million impoverished households, who fell into or returned to poverty due to illness, out of poverty.

Next, the NHC will continue to summarize these successful experiences and help fight the poverty alleviation battle by improving people's standard of health. At the same time, we will establish a long-term mechanism that can address both the symptoms and root causes with long-term and short-term plans, in order to ensure that when we achieve the goal of building a moderately prosperous society in all respects, and that no group of people is left behind because of health issues. Thank you.

The Poster News APP:

During this fight against the epidemic, the Internet Plus Healthcare played an important supporting role and drew attention. What did the National Health Commission (NHC) do to support Internet Plus Healthcare? How did it work?

Yu Xuejun:

It is an important question. Information technology is changing rapidly, and cloud computing, the Internet of Things, big data, artificial intelligence and mobile internet play an increasingly important role in healthcare work. In particular, great progress has been made in information technology and Internet Plus Healthcare during the 13th Five-Year Plan period.

Now, I would like to invite my colleague Mr. Mao to brief you on it.

Mao Qun'an:

As just introduced by Mr. Yu, Internet Plus Healthcare is becoming increasingly important in optimizing the allocation of health resources, innovating service models, improving service efficiency, reducing service costs and enhancing people's sense of gain in getting access to health services. It also adds new vitality to the development and reform of China's healthcare undertakings. The NHC and relevant government departments jointly implemented the opinions on promoting Internet Plus Healthcare issued by the General Office of the State Council in April 2018.

First, we formulated and released over 10 policies, covering the regulation and management of online healthcare, pricing and payment, personal information protection and so on. This was done in coordination with over 10 other government departments including the National Healthcare Security Administration. 

Second, we mounted up support for information infrastructure. Playing a pivotal role, regional platforms break the situation of information isolated island, and released 227 standards of applying information technology in healthcare. Now, over 90% of the top-level public hospitals have already realized inter-hospital information exchange and sharing.

Third, we summarized experience in promotion and demonstration. The NHC signed agreements with 11 localities including Ningxia on jointly building Internet Plus Healthcare demonstration provinces, autonomous regions and municipalities. They will be used to explore development policies, regulatory models, as well as standards and norms.

Fourth, we strictly observed the bottom line of supervising safety. So far, 30 provinces throughout the country have already set up online platforms of supervising healthcare services. The move aims to use new means to regulate new forms of business, protect important data and personal information with special actions, strengthen privacy protection, and ensure medical quality and data security.

Through the joint efforts of many parties, the development of Internet Plus Healthcare benefited increasingly. Now in China, there are 900 internet-based hospitals, a telemedicine collaboration network covering more than 24,000 medical establishments in all prefecture-level cities, and over 5,500 hospitals at or above the level of grade two that can provide online services. Zhejiang province incorporated an electronic health card and electronic social security card, reducing the number of procedures when seeing a doctor from eight to three, and cutting the times of queuing up for payment.

Various localities offered people a series of services during the epidemic prevention and control process, including epidemic prevention knowledge sharing, online question and answers, psychological counseling, remote consultation, further consultation for patients with chronic diseases, and drug delivery. The services based on Internet Plus Healthcare helped to reduce potential risks of cross infection in gathering, and met people's needs for medical care, opening up a second front of fighting against the epidemic on the internet.

As a next step, the NHC will further integrate information technology and healthcare, and improve the development basis, mechanism and application by making better use of Internet Plus, so as to benefit more people with Internet Plus Healthcare, and make people more satisfied with healthcare services. Thank you.

China Daily:

The rule of law is the foundation of governance, and a major part of improving the governance system and its capacity. What progress and achievements has China made in the rule of law in the healthcare field during the 13th Five-Year Plan period? Thank you.

Yu Xuejun:

Thank you for your question. It is also very important.

The NHC has attached great importance to governance and administration in accordance with the law, thoroughly studied and implemented the new ideas, new thinking and new strategies of General Secretary Xi Jinping on overall law-based governance. We focused on core tasks of healthcare work, exercised administration in accordance with the law in an all-round manner, strictly perform duties in accordance with the law, and strengthened power supervision and institutional construction, making breakthroughs in the rule of law in the healthcare field during the 13th Five-Year Plan period.

First, we ensured good governance with sound laws, and consequently, promoted the high-quality development of healthcare undertakings. Major breakthroughs were made in healthcare legislation. The Law on Basic Medical Care and Health Promotion, an important law attracting wide attention, was finally introduced during the 13th Five-Year Plan period after a long legislation process. In addition, the Law on Traditional Chinese Medicine and the Law on Vaccine Administration were also introduced successively. In particular, the Law on Basic Medical Care and Health Promotion is the first fundamental and comprehensive law in the healthcare field in China. Upholding principles of putting people first and developing healthcare undertakings for public good, it strives to provide fair and accessible basic healthcare services, cultivate community-level medical organizations and personnel, and transform experiences in medical reforms such as three-tier system and medical consortium construction into laws. At the same time, it stipulates in law the fundamental purpose of healthcare undertakings, and to establish a basic healthcare system, improve healthcare service system, cultivate healthcare personnel, upgrade healthcare services, develop healthcare technologies, optimize health promotion measures, increase drug supply and funds, and strengthen supervision and administration. The law provides a legal protection to healthcare reform and development.

Second, we have strengthened and explored new ways for healthcare supervision, tightened law enforcement, promoted the oversight model using randomly selected inspectors to inspect randomly selected entities and requiring the prompt release of results. We also applied internet and IT technologies in the supervision system. We strengthened operational and post-operational oversight, and ensured that law enforcement officials of different departments can complete their tasks more efficiently through integrating similar inspection procedures. We are also trying to improve the effectiveness of law enforcement through building the social credit system, promote the mechanisms for preempting and mediating medical disputes, improve self-management of medical institutions, and establish a routine process for preventing and handling medical disputes.

Third, we have delegated powers and improved public services to increase people's sense of fulfillment. Specifically, we adjusted our administrative approval procedures and relaxed rules for market entry. For example, there are no longer restrictions on running private hospitals, the number of such hospitals in certain areas, as well as their geographical distributions. Private hospitals are able to declare a commitment to compliance in applying for allocation of class-B large medical equipment. All intermediary services which are required to obtain government approval are banned, and the reform for separating the business license from certificates required for starting a business is carried out more extensively. The requirement for review and approval for setting up clinics was replaced by a simple filing process as we continue to streamline administrative procedures and reduce the time needed for those procedures. Government services are now available without regional barriers and filings for free medical consultations and other services can also be completed online. All of these policy measures have been formulated with the aim of providing better services.

Next, under the goal of advancing the Healthy China Initiative and enhancing the rule of law, we will implement the Law on Basic Healthcare and Health Promotion, revise the Law on the Prevention and Treatment of Infectious Diseases and other major laws and regulations, so as to build a systematic, properly-formed and effective legal system for the healthcare sector. Thank you.

National Business Daily:

During the 13th Five-Year Plan period, what measures have been taken to deepen health system reform to make medical services more accessible and affordable? Thank you.

Yu Xuejun:

I'll take this question. The reform of the health care system is an issue of common concern, especially since the difficulty and high cost of access to medical care remains a major livelihood issue of concern to the public.

During the 13th Five-Year Plan period (2016-2020), the Central Committee of the Communist Party of China (CPC) and the State Council prioritized healthcare system reform on our overall reform agenda. We have made much progress in making medical services more accessible and affordable. 

Regarding accessibility, we focus on rebalancing the distribution of quality medical resources so that more are available at the community level. First, we push the orderly development of regional medical centers as we launched pilot programs in eight provinces so as to upgrade the distribution of high level medical resources across the country. We promoted the construction of health alliances and medical reform in county-level regions. As of now, 84% of county-level hospitals are above Grade II levels. In 2019, up to 90% of patients with common diseases and frequently occurring diseases have sought medical treatment at their local county-level hospitals.

Second, we keep integrating resources and services. We have set up 1,408 medical groups, 3,346 county-level medical alliances, and 3,924 cross-region alliances for disease treatment. We have also promoted the family doctor services, and built more community hospitals on a pilot basis, so as to improve community-level medical services. Third, we keep pushing reforms to delegate power, improve regulation, and upgrade services, and promote the regulated development of the health industry and privately-run hospitals. Fourth, we are also moving faster toward the applications of internet and IT technologies in the healthcare sector, and continuing to scale up tele-medicine services.

In 2019, telemedicine services were carried out nationwide for more than 21,723,000 visits. By the end of 2019, 258 cities and municipalities had implemented a regional medical consultation card. Information technology is used to optimize service processes, and online services such as medical appointments, consultation navigation, and mobile payment are commonly implemented in hospitals above the second level. Over 50% of outpatient services in third tier hospitals are delivered via the online appointment system.

In the area of alleviating the high cost of medical care, we have focused on centralizing medicine procurement in order to lower drug prices. The prices for the first batch of 25 selected drugs were cut by an average of 52% in a pilot program carried out in four municipalities and seven sub-provincial cities. The program was later scaled up across the country. The second batch of selected drugs have also seen their prices cut by an average of 53%. We carried out drug pricing negotiations, applied a zero-tariff policy on imported cancer treatment drugs, improved the national system of essential medicines, regulated drug use, and guaranteed the availability of drugs in short supply. Second, with expanded comprehensive reform in public hospitals, we put an end to the practices of hospitals funding their operations with profits from overpriced drugs, launched pilot programs for modern management in hospitals, and set up a performance evaluation scheme that focuses on quality and the public good. Third, the national medical insurance system has been improved as we established a unified basic health and unified major disease insurance schemes for rural and non-working urban residents across the country. Government subsidies for basic medical insurance is increasing year by year, the medical bill payment mechanism is moving from a fee-for-service model to a comprehensive payment mechanism, the medical treatment system is improving, and commercial health insurance is receiving increased government support.

The 14th Five-Year Plan period will be crucial as we continue to reform the healthcare system. We will strive to make medical services more accessible and affordable to the general public.

Thank you.

Hong Kong's Bauhinia Magazine:

The health planning of the 13th Five-Year Plan proposed the preservation, innovation and development of traditional Chinese medicine (TCM). And this year witnessed the important role of TCM in fighting against the COVID-19. So, what exactly has TCM achieved in terms of preservation and innovation during the 13th Five-Year Plan period? How to evaluate the contribution of TCM in the aspect of promoting China's healthcare development? Thank you.

Yu Xuejun:

I'll give the floor to Mr. Mao.

Mao Qun'an:

Regarding TCM's overall situation, Mr. Yu just introduced several major events in the TCM field during the 13th Five-Year Plan period. Guidelines have been issued on promoting TCM's preservation, innovation and development, and the State Council held a national conference on these aspects. 

It should be said that TCM reflects all the advantages and characteristics of China's healthcare undertakings. Over the years, we have striven to provide public routine medical services. Especially in personal healthcare aspects, people are more likely to accept the theories and treatments of TCM. During the prevention and control work of dealing with the COVID-19 pandemic, TCM participated in the treatments from the very start and achieved very good results. Many effective drugs and rehabilitation treatments have been developed in the actual treatment processes. This once again highlights traditional advantages of TCM and reminds us that we should continue to promote it on the basis of inheritance and preservation.

The National Health Commission and the National Administration of Traditional Chinese Medicine have reached agreements on building TCM service system, professional personnel training, technological innovation, etc. In the 13th Five-Year Plan and in compiling the 14th Five-Year Plan, the development of TCM occupies a very important place. Recently, according to the instructions of leaders of the commission, our planning department has closely communicated with the National Administration of Traditional Chinese Medicine to incorporate TCM, in the next step, into the planning and building of the National Medical Center and National Regional Medical Care Center. Therefore, TCM will enter a rapid development phase during the 14th Five-Year Plan period, and will enjoy a golden time. Thank you.

China Review News:

During the 13th Five-Year Plan period, building the Healthy China Initiative entered the fast track. How can we make use of the organizational advantages of the patriotic sanitation campaign to carry out and to help promote and implement the Healthy China Initiative? Thank you. 

Yu Xuejun:

This issue is also very important. After the outbreak of the pandemic this year, General Secretary Xi Jinping issued important instructions regarding the patriotic sanitation campaign on many occasions. Especially during the pandemic prevention and control period, the campaign has played a very important role, and its work has been thoroughly rejuvenated. It still needs to be further reformed and to be given new connotations and extensions. Mr. Mao is in charge of this work, so I'll invite him to answer the question.

Mao Qun'an:

The 19th CPC National Congress made major decisions and deployments on implementing the Healthy China Initiative. It has stressed that we need to put prevention first, advocate a healthy and civilized lifestyle, and prevent and control major diseases. The State Council released a plan on the implementation and evaluation of the Healthy China initiative, established a national level promotional committee, published the Healthy China Program (2019-2030), and issued the plans for organizing, implementing and assessing of the program. The program is the construction blueprint and roadmap for implementing the "Healthy China 2030" Planning Outline. We have set up 15 major special actions. Each of them has clear tasks, goals and specific responsibilities for individuals, families, societies and government. This fully reflects integration of health into all policies. It will help promote interactions between departments and the society, as well as the involvement of all citizens. And it will be conducive to undertaking the health responsibilities and sharing the health action outcomes. Last June, Mr. Yu launched the Healthy China Initiative here.

Since the launch, it has made good progress. The public has been paying more attention to health, and increased their awareness of health and ability of disease prevention. Local governments have carried out various health promotion activities to solve prominent health problems, such as nearsightedness and obesity among young people, public healthy diet and scientific fitness. All have achieved good results.

The patriotic sanitation campaign constitutes the successful practice of our Party in applying the mass line in regard to the work of health and disease prevention, and an important tool for building a healthy China. During the 13th Five Year Plan period, we organized and mobilized the general public to solve prominent hygiene and health problems in their work and lives, with special focus on building healthy cities and towns, improving environmental hygiene in both urban and rural areas as well as promoting the rural "Toilet Revolution, all have scored remarkable achievements.

Next, we will continue to give full play to the organizational and mobilizing advantages of the patriotic sanitation campaign, focusing on the major health problems facing our residents and the main factors affecting their health, and further carry out the basic projects for healthy communities, healthy villages and towns, healthy organizations and healthy families. Through these projects, we will establish and improve the health management and service system, and enhance healthcare, sports and fitness, environmental protection and psychological intervention in an integrated manner. We count on the whole of society to make concerted efforts under the principle of extensive consultation, joint contribution and shared benefits, so as to make sure all the related tasks are performed in all communities and organizations. 

We will also review and popularize the good habits developed through COVID-19 prevention and control efforts, such as wearing face masks in public places, implementing waste sorting, keeping social distancing requirements, portioning the meals for everyone and using serving chopsticks when eating together, making medical appointments and seeking medical consultation online, as well as other aspects of a healthy lifestyle. Meanwhile, we will further enrich the connotation of the patriotic sanitation work, innovate work patterns and approaches, promote the transformation from integrated environmental hygiene improvement to comprehensive social health management, and give play to the unique role of patriotic sanitation work in building a healthy China. Thank you.

Xinhua Finance:

Mr. Mao, what is the current development of the smart fitness and elderly care industry, please? What steps will be taken next to support and encourage the growth of the industry? Thank you.

Mao Qun'an:

Since the establishment of the National Health Commission (NHC), providing health services for the elderly as well as infants and children has been a very important task for us. Improving the healthcare service system for the elderly is a significant task at present, and is also the work we should strengthen during the 14th Five Year Plan period. "Fitness and elderly care + internet + smart management is now a new form of business, and is also a promising development model for fitness and elderly care that we have confidence in. In our daily work, we pay very close attention to the explorations made by some enterprises in this regard. We hope that, in the development of the fitness and elderly care industry, the new generation of information and communication technologies can be well applied, and the current mature technologies and approaches of healthcare can be adopted. Additionally, we will vigorously advance the smart fitness and elderly care services as a branch of the health industry in future developments. Thank you.

Shou Xiaoli:

Thank you, Mr. Yu and Mr. Mao, as well as friends from the press. That's all for today's press conference of the State Council Information Office. Goodbye!

Translated and edited by Zhang Liying, Huang Shan, Li Xiao, Zhang Rui, Yuan Fang, Fan Junmei, Zhang Jiaqi, Wang Yanfang, Guo Yiming, He Shan, Yan Xiaoqing, Zhou Jing, Xu Xiaoxuan, Li Huiru, Wang Yiming, Yang Xi, Jay Birbeck, Laura Zheng, David Ball, and Geoffrey Murry. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Liu Huanxin, vice-minister of agriculture and rural affairs

Wu Hongyao, member of the Leading Party Members' Group of the Ministry of Agriculture and Rural Affairs

Wei Baigang, chief economist of the Ministry of Agriculture and Rural Affairs

Chairperson:

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office

Date:

Oct. 27, 2020

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to the State Council Information Office (SCIO) press conference. During the 13th Five-Year Plan period (2016-2020), major progress has been made in the development of agriculture and rural areas. All the related tasks and targets set out in the plan have been accomplished. Today, we are pleased to be joined by Mr. Liu Huanxin, vice-minister of agriculture and rural affairs; Mr. Wu Hongyao, member of the Leading Party Members' Group of the Ministry of Agriculture and Rural Affairs; and Mr. Wei Baigang, chief economist of the Ministry of Agriculture and Rural Affairs. They will brief you on the achievements made in the development of agriculture and rural areas during the 13th Five-Year Plan period and answer your questions.

First of all, I invite Mr. Liu to make an opening statement.

Liu Huanxin:

Ladies and gentlemen, friends from the media, good morning. I'm very delighted to meet you here. I would like to thank you for your long-term concern and support for the work related to agriculture, rural areas, and farmers.

This year is the final year for the completion of the 13th Five-Year Plan. Departments of agriculture and rural affairs at all levels have been fully implementing the guiding principles of General Secretary Xi Jinping's important instructions, putting into practice the decisions and plans of the Central Committee of the Communist Party of China (CPC) and the State Council, and focusing on ensuring stability on the six fronts and security in the six areas. We've effectively responded to risks and challenges, including the COVID-19 epidemic, severe flooding, and serious crop diseases and pests . The development of agriculture and rural areas has maintained a stable and strong momentum. Grain output is expected to reach a new record. The recovery of hog production is better than expected. There are adequate supplies of non-grain food and the gap between urban and rural incomes has narrowed.

During the 13th Five-Year Plan period, the CPC Central Committee with Comrade Xi Jinping at its core has placed addressing issues relating to agriculture, rural areas, and the wellbeing of farmers at the top of the work agenda of the CPC, given priority to agriculture and rural areas, and mapped out the important strategy for rural revitalization. Historic achievements and changes have been made in agriculture and rural areas. Related tasks and targets set in the 13th Five-Year Plan have been accomplished. All this has offered strong support for winning the battle of poverty elimination and completing the building of a moderately prosperous society in all respects as scheduled. It has also helped seize the strategic initiative in maintaining overall stability in economic and social development, as well as tackling risks and challenges at home and abroad.

First, we have greater control over the food supply for 1.4 billion Chinese people. We have continued to increase food crop production based on farmland management and the application of technology. We have completed the task of developing 53.36 million hectares of high-standard cropland that produces good yields in times of drought or excessive rain. We have established 72.53 million hectares of functional zones for grain production and protected areas for the production of major agricultural products. Grain output has exceeded 650 billion kilograms for six consecutive years, bringing the production capacity to new heights. The self-sufficiency ratio of rice and wheat has been maintained above 100%, and that of corn above 95%. There are diverse and adequate supplies of meat, eggs, milk, fruit, vegetables, and tea, meeting the increasing consumption demands of the people.

Second, agricultural modernization has reached a new level. The contribution of advances in agricultural science and technology to agricultural production has exceeded 60%. The overall level of mechanization in plowing, sowing, and harvesting exceeded 70%. All farmland used for planting major crops nationwide has been sown with superior strains of crop. There are now more than 1 million family farms, 2.23 million farmers' cooperatives, and 893,000 commercial organizations that provide agricultural services. These organizations have become the mainstay of modern agriculture, better aligning smallholder farming and the development of modern agriculture. The use of fertilizer and pesticides has registered negative growth for the three years in a row. The acceptance rate of agricultural products under quality monitoring has been maintained above 97%. Putting quality first and adhering to green development have become dominant themes in modern agriculture.

Third, the target of doubling farmers' income has been achieved ahead of schedule. In 2019, the per capita disposable income of rural residents exceeded 16,000 yuan, doubling 2010's figure one year ahead of schedule, and marking a growth rate faster than that of urban residents for the 10th year in a row. The gap between urban and rural incomes has also narrowed, falling from 2.73:1 in 2015 to 2.64:1 in 2019. In the first three quarters of this year, the per capita disposable income of rural residents grew by 1.6% in real terms to 12,297 yuan. The growth rate will continue to rise in the fourth quarter. In the year for completing the building of a moderately prosperous society in all respects, farmers will have a stronger sense of gain and happiness.

Fourth, decisive achievements have been made in the fight against poverty. By the end of this year, all of China's poor as defined by the current standards will be lifted out of poverty, all 832 impoverished counties will be removed from the poverty list, and the overall regional poverty problem will be resolved. The poverty alleviation policies with an aim of supporting local industries cover 98% of poverty-stricken households. In poverty-stricken areas, more than 1 million poverty alleviation projects that support local industries have been implemented and more than 300,000 poverty alleviation industrial bases have been built. Each poverty-stricken county has formed a leading industry with distinctive characteristics and the capacity to erase poverty. Poverty alleviation through supporting local industries has become the measure with the widest coverage, mobilizing the largest number of people and having the most effective results.

Fifth, rural revitalization has achieved a good start. The rural revitalization strategic plan was issued and implemented, the CPC's rural work regulations were promulgated and implemented, and the rural revitalization institutional framework has mostly taken shape. The penetration rate of rural sanitary toilets has exceeded 65%, while the coverage rate of the collection, transportation, and disposal system for domestic waste in administrative villages has exceeded 90%. Meanwhile, the three-year action objectives and tasks for the improvement of rural human settlements have been largely completed. Additionally, the construction of infrastructure such as rural water, electricity, road and communications facilities has been accelerated, the level of public services such as education, medical care, and elderly care has been continuously improved, the rural governance system has been further improved, and the rural areas are now taking on a new look.

Sixth, rural reforms continue to deepen. The basic rural management system has been further consolidated and improved and more than 200 million rural households have received certificates of land contract management rights. After the second round of land contracts expired, a new land contract policy which allows the validity period be extended for another 30 years upon expiration was promulgated. Elsewhere, significant progress was made in the "three-rights separation" system for separating ownership rights, contract rights, and management rights for contracted rural land. A new round of rural homestead reform pilot projects was also launched. The asset and capital verification of rural collective assets have for the most part been completed and the identities of more than 600 million collective members has been confirmed. The supporting and protection system and institutions for agriculture have been gradually improved and an ecological-oriented agricultural subsidy system has been established. Policy to adjust and improve the use of land transfer income with a priority to supporting rural revitalization has been issued. The main framework of rural reform is now basically in place.

These achievements are the result of the overall arrangement and strong leadership of the CPC Central Committee with Comrade Xi Jinping at the core, the result of hard work and unremitting efforts by hundreds of millions of farmers and officials, and the result of continuous improvement and persistent reinforcement of policies to strengthen agriculture, benefit farmers, and raise rural living standards.

During the 14th Five-Year Plan period, we will firmly establish a new development concept, implement demands for high-quality development and new development patterns, adhere to the general guideline of prioritizing agricultural and rural development via the implementation of the rural revitalization strategy. We shall also steadily improve the security level of important agricultural products such as grain, strive to improve the quality, efficiency, and competitiveness of agriculture, focus on strengthening the construction of beautiful and livable villages, consolidate and improve the results of poverty alleviation, continue to deepen rural reforms, and improve the rural governance system to accelerate the modernization of agriculture and rural areas.

Next, my colleagues and I will answer your questions.

Shou Xiaoli:

Thank you, Mr. Liu Huanxin. Now let's begin the question and answer session. Please state the news outlet you represent first.

CCTV:

During the 13th Five-Year Plan period, in order to adapt to the people's need from eating to allay their hunger to eating for nutrition, the focus of agricultural development has been shifted from a quantity-oriented to quality-oriented approach. I want to know, after five years of hard work, what measures have been taken to maintain the security of important agricultural products such as grain? What are your next considerations? Thank you.

Liu Huanxin:

This question is a very good one, and it is also an issue of great concern to all sectors of society and the general public. As you said, people's living standards have improved and consumption is changing from eating to allay their hunger to eating for nutrition and health. To effectively meet the upgraded consumption needs of the common people, agricultural and rural departments at all levels continue to deepen the supply-side structural reforms of the agriculture, vigorously promote measures to revitalize agriculture through high-quality and green development, and to strengthen agriculture by building brands. The supply levels of important agricultural products such as grain has increased significantly. Next, I will summarize it in three aspects:

First, adequate supply. Food supply has always been our top priority in the last five years. We have vigorously implemented strategies to ensure the supply of important agricultural products, and the supply of grain and important non-staple food has been adequate. Grain production has further increased and stabilized at above 1.3 trillion jin (650 billion kilograms) annually, guaranteeing each citizen 470 kilograms of grain on a yearly basis. This is much higher than the internationally recognized food safety line of 400 kilograms. We have worked to ensure food supply for 1.4 billion Chinese people through our own efforts. The production capacity for cotton, edible oil and sugar also improved. We also saw good harvests for products included in the "vegetable basket" (non-grain food supply). In 2019, China produced 77.59 million tons of meat, 33.09 million tons of eggs, 32.01 million tons of milk, 274 million tons of fruit, 721 million tons of vegetables, and 64.8 million tons of aquatic products. And the overall output of these products is expected to steadily increase this year. I would say that the "rice bag" (grain supply) and "vegetable basket" (non-staple food supply) are both diversifying. As long as there is demand, there is supply. 

Second, better structures. Led by market demands, we have improved the agricultural structure in the last five years. The supply of green and quality agricultural products has increased significantly. The structure of crop planting has continued to improve. In the past, wheat was mainly used to make steamed buns and noodles, but now 35.8% of the wheat planted is high- and low-gluten wheat used to make bread, cakes and pastries. The planting area of quality rice has further expanded; the soybean planting area has increased annually for five consecutive years; the cultivated land change from growing grain crops to cultivating feed crops has exceeded 15 million mu (1 million hectares), and a production mix of food, cash, and fodder crops has initially taken shape. Animal husbandry is also upgrading at a faster pace. The proportion of large-scale hog breeding has reached 53% of all hog breeding. Beef and mutton production also increased rapidly. More and more consumers are now choosing domestically produced milk powder, meeting the need for a consumption structure upgrade. 

Third, improved quality. We have attached greater importance to quality and safety in the last five years. To ensure quality production and supervision, we have set up a production standard system for edible agricultural products and fully implemented the system for granting certificates of quality. Quality and safety monitoring show that over 97% of agricultural products are up to standard. We now have more robust measures in place to ensure food safety. More than 49,200 agricultural cases have been granted certificates for green, organic or GI (Geographical Indication) products. More and more green and quality agricultural products are now available in the supermarkets and on dining tables.  

Next, to better meet people's growing expectations for a better life, we will implement strategies to ensure the supply of important agricultural products, continue to deepen the supply-side structural reform in agriculture and implement a regional production and supply plan for important agricultural products. In addition, we will continue to stabilize grain production, increase the supply of products included in the "vegetable basket," improve the structure of agricultural products, and enhance their quality, efficiency and competitiveness. Thank you.

The Poster News APP:

What measures have the Ministry of Agriculture and Rural Affairs taken to accelerate the integration of the primary, secondary and tertiary industries in rural areas during the 13th Five-Year Plan period? How effective are the measures? Thank you. 

Liu Huanxin:

The integration of the primary, secondary and tertiary industries is a crucial issue in agricultural and rural development. I will first invite Mr. Wei to answer the question. 

Wei Baigang:

Thank you for your question. In 2015, the State Council's General Office released the Guidelines on Advancing the Integration of Primary, Secondary and Tertiary Industries in Rural Areas. In the past few years, all departments in all locales have earnestly put in place the decisions and plans of the CPC Central Committee and the State Council on accelerating industrial development in rural areas. Based on agricultural resources and other resources of the rural areas, we have accelerated the development of industries that can increase farmers' incomes; speed up the integration of the primary, secondary and tertiary industries; and made great efforts to keep more jobs in the rural areas and to give more added value of the secondary and tertiary industries to farmers. I'd like to summarize the measures and their results in the following aspects. 

First, we have vigorously developed the agricultural product processing industry. In 2019, China was home to 1,600 agricultural products processing parks and 81,000 processing enterprises above designated size. The industry reported revenue of more than 22 trillion yuan and created over 30 million jobs.  

Second, we have vigorously developed industries with rural characteristics. A number of characteristic industrial towns with an output value of over one billion yuan have been built as well as characteristic industrial villages with an output value of over 100 million yuan. A number of rural craft technologies have been discovered.

Third, we have accelerated the development of rural leisure tours. We have built a number of high-quality leisure scenic spots and promoted a variety of key leisure and tourist itineraries. In recent years, the Ministry of Agriculture and Rural Affairs has promoted a total of 1,000 high-quality rural itineraries for tourists, making them popular among urban residents wishing to travel to the countryside during the National Day holiday. In 2019, rural recreational tourism received 3.2 billion tourists with its revenue exceeding 850 billion yuan.

Fourth, we have boosted the growth of new rural services. In 2019, the output value of agriculture, forestry, animal husbandry, the fishery industry and supporting activities reached 650 billion yuan. There were more than 30,000 agriculture-related e-commerce businesses. Rural online sales reached 1.7 trillion yuan, including 400 billion yuan from online sales of agricultural products.

With the strong support of favorable policies, we have speeded up the building of platforms for rural industry development. A total of 151 modern national agricultural parks have been set up nationwide. This has encouraged local authorities of provinces, cities and counties to develop more than 3,000 modern agricultural parks and over 1,000 agricultural associations, as well as more than 800 towns with a prosperous agricultural industry. The rapid growth of rural industry and the accelerated integration of primary, secondary and tertiary sectors now provide important support in increasing employment and incomes for farmers and a significant growth pole for rural economic development.

Next, the Ministry of Agriculture and Rural Affairs will continue to pursue supply-side structural reform of agriculture. Our main tasks are to keep striving to build platforms for the integrated development of primary, secondary and tertiary sectors in rural areas, focus on key industries, attract resources, boost innovation and leadership, extend the industrial chain, and upgrade the value chain so as to accelerate the formation of rural development pattern in which farmers, enterprises and society all participate. Thank you.

Farmers' Daily:

The public is concerned about progress in toilet renovation and the disposal of wastewater and garbage. What progress has been made in the Three-Year Action Plan for Improving the Rural Living Environment? And what achievements have been made? Thank you.

Liu Huanxin: 

Let's give the floor to Mr. Wu Hongyao, a member of the CPC Leading Group of the Ministry of Agriculture and Rural Affairs, to take that question.

Wu Hongyao:

Thank you. Let me answer the question. Both the CPC Central Committee and the public have attached great importance to improving the rural living environment. At the beginning of 2018, the General Office of the CPC Central Committee and the General Office of the State Council issued the Three-Year Action Plan for Improving Rural Living Environment. The Office of the Central Rural Work Leading Group and the Ministry of Agriculture and Rural Affairs, in collaboration with relevant authorities, have actively played a leading role in making solid progress in implementing the Three-Year Action Plan by learning from Zhejiang's experience in village renovations in accordance with the policies and plans of the CPC Central Committee and the State Council. Renovation work is now underway nationwide, with major progress being made. The goals and tasks set in the plan have mostly been completed.

First, most villages have become clean and tidy. At the end of 2018, 18 departments, including the Office of the Central Rural Work Leading Group and the Ministry of Agriculture and Rural Affairs, launched a village cleaning campaign. A series of activities were organized to encourage farmers to take spontaneous action in cleaning up rural household garbage, village ponds and ditches, as well as agricultural waste such as manure from livestock and poultry breeding. Farmers were further encouraged to change bad habits that adversely affect the rural living environment. Strict and coordinated measures have been taken against the problem of dirtiness and untidiness in villages. More than 95% of villages have taken part in cleaning-up activities, and the appearance of these villages has been significantly improved.

Second, we have made solid progress in the rural toilet revolution. We have always tailored our measures to local conditions when implementing policies and have given priority to quality. We have guided local authorities to prioritize the promotion of toilet renovation in Class-I counties, while steadily promoting the work in Class-II counties and launching trials of the work in Class-III counties by issuing policy documents, holding deployment meetings, enhancing technical support, carrying out supervision and inspection, and promoting publicity and training. We urged the local authorities to improve the quality and effectiveness of rural toilet innovation and ensured that the public is satisfied with the work. Currently, more than 65% of rural areas are equipped with sanitary toilets. Since 2018, more than 30 million rural toilets have been renovated. 

Third, we have made coordinated efforts in promoting the treatment of rural household garbage and sewage. We have actively cooperated with relevant departments to strengthen rural household garbage and sewage treatment and improve the construction, management and protection mechanisms. At present, the system of rural household garbage collection, transportation and disposal has covered more than 90% of the country's administrative villages. A total of 99% of the 24,000 unqualified garbage sites identified nationwide have been cleaned up, and the rural sewage treatment has been improved.

Next, we will improve the rural living environment as required in the 14th Five-Year Plan on the basis of summarizing the effects of implementing the Three-Year Action Plan. We will continue to improve the rural living environment in order to give farmers a greater sense of gain and happiness. Thank you.

The Cover: 

Corn prices have been rising rapidly since the beginning of this year. We have noted that the Ministry of Agriculture and Rural Affairs explained that one of the reasons for the high price is the strong demand and reluctance of farmers to sell. What measures are the ministry taking to deal with this issue? Thank you.

Wei Baigang: 

Thank you for your interest. As you said, the price of corn has risen recently and people have been paying close attention to the corn market. We responded to this issue at the press conference held by the Ministry of Agriculture and Rural Affairs several days ago.

Since the beginning of this year, the price of corn did go up. In September, with new corn from the north and northeast of China coming into the market, prices began to fall. After the National Day holiday, the price then rose again. As far as we know, the listed purchase price of corn in some parts of Jilin province is around 2.34 yuan per kilogram, and that of some regions in Heilongjiang province is around 2.2 yuan per kilogram. According to our analysis, there are three reasons for this price rise. 

First, demand is strong. As the production of pigs is recovering and speeding up, the demand for corn for feed has increased. At the same time, the demand for alcohol and related products, including corn starch, is also increasing. The price has increased because processing enterprises and traders are generally optimistic about the corn market.

Second, costs have increased and farmers are reluctant to sell. This year, the impact of typhoons on the corn yield in northeast China has been limited, but corn stalk lodging occurred in some areas, resulting in higher costs for harvesting. Our research shows that the cost of harvesting lodged corn by machine is around 100 yuan higher per mu than during normal years. Farmers say that each extra ear of corn can earn them 40-50 cents more. After harvesting, they have tended to wait a few days when having seen that prices were rising.

Third, capital speculation. Affected by the global pandemic, domestic and foreign investment markets have shown greater interest in the grain market. Since October, international and domestic corn futures prices have risen significantly, and traders and processing enterprises are expected to increase bullish expectations, leading to a rise in spot prices. Corn prices are set to stabilize in the near future.

We believe that this round of corn price hike is a restorative rise following on from the reform of the collection and storage system, which is mainly the result of market effects. In the future, the decisive role of the market in the allocation of resources will still be brought into play. We will also work with relevant departments to ensure the corn supply and endeavor to increase grain production and supply. At present, the corn harvest is 90% complete, and a bumper harvest is in sight. The next step is to guide all regions in harvesting and drying work, so as to ensure that the harvest of autumn grains is plentiful and can be sold as soon as possible. Relevant departments will strengthen their supervision of corn warehouse auctions in the early stage, and urge buyers and sellers to timely get goods available on the market as soon as possible. At present, stocks of rice and wheat are sufficient, while some can be auctioned for feed. In short, the corn supply will gradually increase in the later period, and there is no support for corn prices to continue rising. Thank you.

Economic Daily: 

In 2018, the CPC Central Committee and the State Council issued the "Strategic Plan for Rural Revitalization," which clarified the overall objectives and priorities involved in rural revitalization. How has the implementation of the strategy progressed? Thank you.

Liu Huanxin:

The implementation of the rural revitalization strategy was an important strategic decision made by the 19th CPC National Congress. The strategy is off to a good start following several years of hard work. Mr. Wei Baigang, chief economist, will answer this question.

Wei Baigang:

Thank you for your interest. The 19th CPC National Congress made a major decision and deployment to implement the rural revitalization strategy, and clearly proposed the general requirements of industrial prosperity, ecological livability, rural civilization, effective governance and rich life. General Secretary Xi Jinping has paid close attention to the promotion of rural revitalization, and made a series of important instructions promoting rural industrial revitalization, talent revitalization, cultural revitalization, ecological revitalization and organizational revitalization. At present, seven aspects and 59 key tasks of the strategic plan are progressing smoothly, and 82 major projects, actions and plans are advancing in an orderly manner. Various regions have carried out demonstration and leading work in rural revitalization, and explored and set a number of good examples such as in improving the living environment, promoting industrial parks, building beautiful villages, and constructing rural civilization. The rural revitalization work gets off to a good start.

First, a mechanism with "Party secretaries at five levels" (provincial Party committees, municipal Party committees, county-level Party committees, township-level Party committees and village-level Party committees) responsible for the work of rural revitalization has been established nationwide. The CPC Central Committee has issued a set of regulations for the country's rural work, specifying the major responsibilities of these five levels of Party secretaries in implementing the strategy for rural revitalization. Leading agencies for the implementation of the strategy have been established in 31 provinces (autonomous regions and municipalities), with provincial Party secretaries and governors serving as heads of the leading groups in most regions. A sound evaluation system has also been established in order to better evaluate and supervise performances in carrying out the strategy.

Second, in carrying out the strategy for rural revitalization, we have been following the procedure of "planning followed by implementation" by local governments at different levels. The CPC Central Committee and the State Council have issued a national rural revitalization strategic program, setting out the goals and tasks that shall be completed by 2020. 31 provinces, autonomous regions and municipalities have also made their own plans so as to align their work with the national program and strictly implement every single task stipulated in the program. Township and village governments have been increasing efforts to formulate their own implementation plans, and some villages have combined separate plans into a single program where conditions allow, thereby making the work more feasible. The Ministry of Agriculture and Rural Affairs has cooperated with some eastern coastal provinces with advanced economies — including Zhejiang, Guangdong, Jiangsu and Shandong - in order to help the eastern coastal areas and other regions where conditions allow achieve basic modernization of agriculture and rural areas. For poverty-stricken areas in central and western China, eliminating poverty is their top priority in implementing the strategy for rural revitalization, and they will win the battle against poverty soon.

Third, the policy framework for rural revitalization has been established. The CPC Central Committee has issued a series of major documents to enhance the rural living environment, revitalize rural industries, strengthen rural governance, improve social etiquette and civility in rural areas, and has created the Chinese farmers' harvest festival. Relevant departments have instituted policies to boost financial services, attract talented personnel, and improve technological services, road building as well as education, amenities, and healthcare services in rural areas. We have also stepped up efforts to establish a mechanism to plan, construct, manage and protect infrastructure in urban and rural areas in a coordinated manner. Moreover, we have been ramping up efforts to ensure that basic public services in urban and rural areas will be provided in accordance with unified standards and systems.

Fourth, a series of landmark projects have been launched. Following the principles of focusing on priorities, addressing inadequacies and shoring up points of weakness, we have launched a set of major projects. These include renovating the rural living environment, constructing high-standard farmland, innovating agricultural technology, creating national-level modern agricultural industrial parks, protecting black-soil farmland in northeast China, and building cold chain logistics facilities for the storage and preservation of agricultural products. These projects have further strengthened the material foundation for the development of agriculture and rural areas.

Going forward, we will follow the deployments and requirements made by the CPC Central Committee, focus on the goals of rural revitalization, and work hard to achieve a good performance in all areas, so as to ensure that decisive progress is made by 2035, with the basic modernization of agriculture and rural areas. By 2050, rural areas should have strong agriculture, a beautiful countryside and well-off farmers. Thank you.  

Hong Kong Commercial Daily:

Technology and equipment are necessary when it comes to the development of modern agriculture. Could you please introduce the progress China has made in the construction of agricultural infrastructure during the 13th Five-Year Plan period? What will the priorities be in the future? Thank you.

Liu Huanxin:

Advanced equipment serves as an essential support in the development of modern agriculture. Improving investment in agricultural infrastructure has always been a priority as stated in "the No. 1 central document" during the 13th Five-Year Plan period. A large number of major projects have been constructed, thereby significantly increasing fixed asset investment in the primary industry. Fixed asset investment in the primary industry between 2016 and September 2020 hit 8.64 trillion yuan, around 1.66 times the level during the 12th Five-Year Plan period. Since 2020, we have been working hard to push local governments to issue special bonds for the development of agriculture and rural areas, so as to overcome the effects of COVID-19 on agricultural and rural investment. A total of 120.2 billion yuan in local government special bonds was issued between January and September, thereby significantly expanding channels for investment and financing. The agricultural infrastructure has witnessed remarkable improvements since the beginning of the 13th Five-Year Plan period. Moreover, technology and equipment have advanced rapidly. The progress can be seen in four aspects:

First, we have significantly scaled up the development of high-standard farmland. By the end of the 13th Five-Year Plan period, we will have completed the construction of 800 million mu (53.3 million hectares) high-standard farmland capable of producing stable, high yields despite drought or flood conditions, and enhanced the disaster resilience and disaster-risk reduction capabilities in agriculture. Grain output will have increased by around 100 kilograms per mu. We have launched a campaign to protect and enhance the soil fertility of cultivated land, and increased efforts to better utilize and conserve black soil in northeast China. We took various measures to combat arable land degradation. In 2019, the average grade of cultivated land across China reached 4.76, up 0.35 from 2014. We also accelerated the construction of efficient water-saving irrigation facilities in rural areas, and the effective utilization coefficient of farmland irrigation water now stands at 0.559.

Second, we have improved our capabilities for breeding superior crop varieties. We established a seed cultivation system featuring three national seed cultivation and production centers in Hainan, Gansu and Sichuan provinces, as well as 52 national seed-producing counties and 100 regional seed cultivation bases. The National Crop Genebank of China (NCGC) is expected to store 1.5 million seed accessions when completed, which will rank the first in the world in terms of conservation abilities. China's modern seed industry has made important breakthroughs, with major crops upgraded and 95% of farmland area planted with domestically cultivated seeds.

Third, the mechanization of agriculture has been developed in an all-round way. The level of mechanization has been rapidly upgraded and the total power of agricultural machinery reached 1.028 billion kilowatts. A total of 453 counties have been built as pilot areas for whole-process mechanization of major crop production. The mechanization of agriculture in hilly and mountainous areas has been accelerated. The overall level of mechanization in plowing, sowing and harvesting exceeded 70%, while the mechanization rate for livestock breeding and aquaculture reached 34% and 30%, respectively. Agricultural mechanization now also covers more areas, including plant protection, straw processing and drying.

Fourth, we have boosted upgrade facilities for livestock and aquatic farming. The construction of livestock housing, automatic feeding, and disease prevention and control facilities has been accelerated. As much as 64.5% of livestock and poultry farming is now carried out on a large scale, and 93% of farms are equipped with manure disposal systems. We have made greater efforts to stimulate the development of the dairy industry. We have supported the upgrade of facilities for dairy farming and built a number of high-quality forage bases. A total of 64% of dairy farming is now carried out on a large scale. We have also promoted the transformation and upgrading of the fishing industry. More than 5,400 national demonstration farms for healthy aquaculture have been established. 

We are currently compiling the 14th Five-Year Plan for agricultural and rural development. We plan to conduct a series of major projects to support the sustainable and strategic development of agriculture, mainly focusing on high-standard farmland, the modern seed industry, cold chain storage and logistics, digital agriculture and rural areas, prevention and control of animal and plant diseases, major scientific infrastructure, as well as other forms of infrastructure. We will increase efforts to improve the level of modern agricultural facilities and equipment. Thank you. 

CNR:

Many leading pig producers in China have predicted that the price of pork will not return to normal until the second half of 2021. What's your take on that？ Thank you. 

Liu Huanxin:

This is a question that is close to our daily lives and people's livelihoods. In recent years, people have paid close attention to this. I would like to invite Mr. Wei to answer this question.

Wei Baigang:

Thank you for your question. I have spoken about pig production resumption and pork prices several times. The change in prices is dependent on supply and demand. Since the beginning of this year, local governments have fully implemented the polices made by the CPC Central Committee and the State Council to support the production of hogs. We support pig farms to boost production and increase efforts to prevent and control the African swine fever. In the first three quarters of this year, 12,500 new large-scale pig farms were built and put into production, and 13,400 empty pig farms re-stocked. By the end of September, pig stocks have reached 370 million, or 84% of the level at the end of 2017, while there were 38.22 million breeding sows, or 86% of the level of end-2017.

As hog production has resumed, more hogs have been slaughtered for market. As a result, pork prices have declined for eight consecutive weeks. At present, the price of pork in wholesale markets is 49.23 yuan per kilogram, a decrease of 10.41 yuan compared to its high in February. The downward trend is obvious.

Looking to the future, the supply of pork is improving. According to recent expert research, when taking factors such as the resumption of hog production, pork imports and consumption demand into consideration, the supply of pork during the two future major holidays of the New Year's Day and Spring Festival will increase by around 30%. Generally, the price will be lower than the same period last year, and there will be no significant rise in prices. As the number of breeding sows and pig stocks increase, the supply will also quickly follow. When the supply goes up, prices will gradually return to normal. Thank you.

People's Daily:

We felt in our interviews, farmers pay high attention to and very much expect to see rural reforms. What progress and achievements have been made in this regard during the 13th Five-Year Plan period? What measures will be taken in the next stage? Thank you.

Liu Huanxin:

Rural reforms are the driving force of rural development. The CPC Central Committee and the State Council attach great importance to the reforms. Through joint efforts across the entire country, the reforms have continuously deepened in recent years and significant progress has been made. Let's invite Mr. Wu from the Ministry of Agriculture and Rural Affairs to answer your questions.

Wu Hongyao:

Since the beginning of the 13th Five-Year Plan period, the Agricultural Office of the CPC Central Committee, the Ministry of Agriculture and Rural Affairs, and other relevant government departments have deepened rural reforms in an all-round way in accordance with the arrangements of the CPC Central Committee and the State Council, making remarkable progress and scoring many achievements. They can be summarized as "a batch in three aspects." First, we introduced a batch of reform plans with top-level design. Second, we carried out a batch of pilot reforms that made in-depth breakthroughs. Third, we established a batch of mature legal systems. Through the reforms, we preliminarily set up pillars and provided institutional and policy support for implementing the rural vitalization strategy. Achievements were demonstrated in six ways.

First, significant progress was made in reforming the rural land system. The verification, registration and certification of land contracts and management rights was successfully completed. A system of separating rights between ownership, contracts, and management was preliminarily established. The Law on Rural Land Contracting was revised. The CPC Central Committee also announced the extension of the second round of rural land contracts by another 30 years, giving farmers assurances in ownership over the long run. The pilot plan for reforming the rural homestead system was also published, marking the launch of a new round of pilot reforms. At the same time, the marketization of rural collective land designated for commercial construction and reforms in rural collective land requisition were in steady progress.

Second, steady steps were made in reforming the rural collective property rights system. The check and verification of rural collective assets were completed smoothly. A total of 6.5 trillion yuan of rural collective assets and 6.55 billion mu of land resources were checked and verified nationwide. A total of 438,000 villages completed reforms that saw productive assets converted into shares and over 600 million members of collective economic organizations were confirmed.

Third, the construction of new agricultural operational systems was accelerated. We implemented programs to cultivate family farms and upgrade farmers' cooperatives. Now there are over one million family farms and over 2.2 million farmers' cooperatives in China. We also supported producer services in agriculture and expanded the number of organizations providing services for agricultural production to 440,000. The commercial and specialized services in agriculture brought small rural households into line with modern agriculture methods and explored a path of agricultural modernization with Chinese characteristics.

Fourth, the system of supporting and protecting agriculture was further improved. We implemented the national food security strategy, adhered to the principle of increasing food crop production based on farmland management and the application of technology, and put into place the strictest system of arable land protection. We designated 1.55 billion mu for permanent basic cropland and 1.088 billion mu for functional grain production and designated protected zones for the production of major agricultural products. We also improved price-setting mechanisms for agricultural products as well as the system for their purchase and storage and established a system for subsidizing agricultural production, all of which achieved positive results.

Fifth, notable achievements were made in developing the rural governance system. A rural governance system under the leadership and organization of the CPC was established preliminarily, integrating self-governance, rule of law, and rule of virtue. The role of community-level Party organizations in leading Party members to devote themselves to reform and the vanguard as well as exemplary role of Party members were brought into full play. We also saw increasingly standardized villagers' self-governance organizations, further highlighted the rule of law in rural construction, and promoted a basically sound mechanism for governing rural customs.

Sixth, solid moves were made to integrate urban and rural development. We made steps to offer urban and rural areas equal access to basic public services as well as set up universal basic aged-care pension, basic medical insurance, and serious illness insurance systems for both urban and rural residents. A total of 95 percent of China's counties passed the assessment for balanced development in compulsory education. Major progress was also made in reassigning rural populations permanent urban resident status. Public employment and entrepreneurship servicing both urban and rural areas equally were also improved significantly.

Next, in accordance with the decisions and arrangements of the CPC Central Committee and the State Council, we will pay more attention to improving agriculture policies in rural areas and for farmers, continue to handle relationships between farmers and landowners, and launch major reforms to improve the rural property rights system and the mechanism for market-based allocation of production factors. In doing so, we aim to promote the free flow and equal exchange of urban and rural production factors, fully stimulate the internal driving forces of rural development, and offer stronger institutional support to the all-round vitalization of rural areas. Thank you.

Shou Xiaoli:

Thank you, Mr. Liu, and thanks to all the other speakers and media friends. That's all for today's press conference.

Translated and edited by Zhang Liying, Yuan Fang, Zhang Rui, Li Huiru, Wang Yanfang, Xiang Bin, He Shan, Gong Yingchun, Cui Can, Zhang Junmian, Zhang Jiaqi, Zhou Jing, Wang Qian, Duan Yaying, David Ball, Laura Zheng, and Tom Arnstein. In case of any discrepancy between the English and Chinese texts, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Wang Zhijun, vice minister of industry and information technology

Lu Shan, director of the Planning Department of the Ministry of Industry and Information Technology (MIIT)

Wen Ku, director of the Telecom Development Department and spokesperson of the MIIT

Chairperson:

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office

Date:

Oct. 23, 2020

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to the press conference of the State Council Information Office (SCIO). During the 13th Five-Year Plan period (2016-2020), remarkable achievements have been made in the reform and development of China's industry and information technology sectors. In order to help people better understand related issues, we are very pleased to be joined by Mr. Wang Zhijun, vice minister of industry and information technology, who will brief you on the development of industry and telecommunication during the 13th Five-Year Plan period (2016-2020) and take your questions.

Also taking part in the press conference today are Mr. Lu Shan, director of the Planning Department of the Ministry of Industry and Information Technology (MIIT), and Mr. Wen Ku, director of the Telecom Development Department and spokesperson of the MIIT.

First of all, I would like to invite Mr. Wang to make his opening statement.

Wang Zhijun:

Friends from the media, ladies and gentlemen, good afternoon. Welcome to today's press conference. I would like to thank you for your long-term interest and support in the development of China's industry and information technology sectors. With regards to the progress in building China into a manufacturing and cyber power during the 13th Five-Year Plan period, Minister of Industry and Information Technology Xiao Yaqing has written a signed article published on the People's Daily. We have provided you all with a printed copy for your reference. Now, I will briefly introduce the development of industry and information technology during the period.

General Secretary Xi Jinping has stressed that we should "work faster to build China into a manufacturer of quality, develop advanced manufacturing, and promote further integration of the internet, big data, and artificial intelligence with the real economy." The 13th Five-Year Plan period is the first crucial stage in building China into a manufacturing and cyber power. Under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, industry and information technology agencies at all levels have implemented the decisions and plans made by the CPC Central Committee and the State Council and continued to follow the general principle of pursuing progress while ensuring stability. We have steadfastly advanced supply-side structural reform and made concrete efforts to build China into a manufacturer of quality and a cyber power.

All the main tasks and targets laid out in the 13th Five-Year Plan are to be fulfilled as scheduled, with overall strength in industry and information technology being raised to new heights. Society has attached greater importance to the real economy as well as the development of industry and information technology. The integration of industrial processes and information technology has reached a much higher level, and solid progress has been made in building China into a manufacturer of quality and a cyber power.

From 2016 to 2019, China's industrial added value increased from 24.54 trillion yuan to 31.71 trillion yuan. This represents an average annual growth of 5.9%, which is much higher than the global average of 2.9% during the same period. In 2019, China's value-added in manufacturing reached 26.9 trillion yuan, accounting for 28.1% of the global total, with the country remaining the world's largest manufacturer for 10 consecutive years. The R&D spending of industrial enterprises above designated size reached 1.43% of the income from their main business operations, exceeding the target of 1.26% ahead of schedule.

The supply system has continuously improved, and the transformation and upgrading of traditional industries has accelerated. From 2016 to 2019, the investment in upgrading technologies has risen from 40.6% to 47.1% as a proportion of total industrial investment. Significant achievements have been made in cutting overcapacity. The target for reducing steel production capacity by 150 million tons set out in the 13th Five-Year Plan has been completed two years ahead of schedule. Energy consumption per unit of industrial added value created by enterprises above designated size has continued to decline. Strategic emerging industries have developed at a faster pace. The value-added by high-tech manufacturing and equipment manufacturing respectively accounted for 14.4% and 32.5% of total value-added created by industrial enterprises above designated size. The two industries have become main forces driving the development of manufacturing.

Since the beginning of the 13th Five-Year Plan period in 2016, major breakthroughs have been achieved in a group of key technologies and products. China's Chang'e-4 lunar probe landed on the far side of the moon; launch missions for the Long March-5 carrier rocket series were successfully conducted; the Tianwen-1 Mars probe blasted off; construction of the BeiDou Navigation Satellite System (BDS) was completed; China's first domestically built polar research vessel and icebreaker, Xuelong 2, joined Xuelong on the country's 36th Antarctic expedition; the Fuxing series of bullet trains which travel at 350 kph began large-scale operation; and breakthroughs were made in new materials, such as materials for large passenger plane C919, and glass substrates for flat panel displays.

The Beijing-Tianjin-Hebei region, Yangtze River Delta and Guangdong-Hong Kong-Macao Greater Bay Area have increasingly played a leading role in promoting the innovation-driven development of manufacturing. Foreign investors' access to China's general manufacturing sector has gradually increased, and important progress has been made in improving opening-up and cooperation. The influence of these sectors on global industrial and value chains has noticeably grown.

The information and communications sector has maintained steady and rapid growth and is playing a major pioneering role in driving economic growth. As internet infrastructure continues to upgrade, our internet penetration goals have been fulfilled ahead of time. By the end of 2019, the household penetration rate of fixed broadband and the user penetration rate of mobile broadband had reached 91% and 96%, respectively. Over 80 million households had access to a 1,000-megabyte fiber internet connection, and over 1.2 billion people were subscribed to a 4G network. The commercial use of 5G is making solid headway. China now has 690,000 5G base stations nationwide, benefiting over 160 million users. The number of server racks in China's data centers has reached 2.2 million, with the average annual growth surpassing 30%. People are enjoying an increased sense of fulfillment. The country has up to 90,000 value-added telecom companies, tripling the number in 2015. The average rates for mobile internet services have been cut by 95% compared to rates in late 2015. China has also launched a campaign to clean up mobile apps that infringe on the legal rights of mobile users. We have well achieved the goal of telecom universal services. Fiber internet connections and 4G networks are both available to 98% of China's administrative villages, driving nationwide efforts for poverty alleviation and rural vitalization.

A sound industrial ecosystem is taking shape in which enterprises of all sizes are pursuing development through collaboration. China is now home to more leading and globally competitive enterprises. The country now features 133 companies on the Fortune Global 500, the most from any one country in the world, and 23 more than in 2016. A total of 14 companies made it onto the 2019 Forbes Digital 100 List, with China Mobile and Alibaba among the top 10. China has also implemented various preferential policies to help companies navigate difficulties, taken measures to improve the policy system for small and medium-sized enterprises (SMEs), and made step-by-step efforts to upgrade government services in order to stabilize entities and drive employment. In information and telecoms, rail transportation, and the new energy vehicles sector, China has also witnessed several SMEs grow into market leaders with strong innovation capacities and international competitiveness. SMEs have seen a significant improvement in their specialization, vitality and competitiveness.

We have also seen a deeper integration of industrialization and informatization. Smart manufacturing technologies are being applied in the construction of digital workshops and smart factories. Industrial internet has made major progress as its networks, platforms, and safety systems continue to develop, with integrated applications now covering over 30 major sectors in the national economy. New business forms and models like smart manufacturing, internet collaborations, customization, servitization, and digital management are gaining momentum. Moreover, the digital economy is booming and transactions in both e-commerce and mobile payment rank first in the world. As big data, cloud computing, the internet of things, and artificial intelligence technologies are increasingly applied to socioeconomic development, we have seen a surge of numerous new business forms and models.

In the face of the COVID-19 pandemic and the complicated domestic and international environment, we have resolutely implemented the decisions and arrangements made by the Central Committee of the Communist Party of China (CPC). We made all-out efforts to guarantee medical supplies, and took the lead in ensuring supplies for epidemic prevention and control and promoting the resumption of work and production, which provided strong support for keeping economic fundamentals stable. Made-in-China products have not only contributed to the domestic and global battle against COVID-19 but also to economic recovery. The value added of industrial enterprises above designated size grew 1.2% year over year in the first three quarters of the year, with the growth rate hitting 5.8% in the third quarter and 6.9% in September. China's industrial sector is on a path of sustained and stable recovery, featuring an accelerating industrial output, the better dovetailing of production and marketing, and the significantly increasing confidence of market entities.

Currently, China is undergoing a crucial and challenging stage in the development of its industry and communications sector. In the face of a complicated domestic and international environment, we will, under the firm leadership of the CPC Central Committee with Comrade Xi Jinping at its core, apply the new development philosophy, study and explore ways for the development in industry and communications, put our comparative advantages to the best use, defuse risks and meet challenges head-on, seize strategic opportunities, hold the initiative in development, and remain firm in our commitment to pursuing development in manufacturing and cyberspace. In order to promote high-quality development, we will continue to deepen the supply-side structural reform, follow the guidelines to consolidate foundations, strengthen areas of weakness, highlight strengths, and upgrade the business environment. We will speed up building a modern industrial system, and foster a new, dual-cycle development architecture with the domestic cycle as the mainstay andwith domestic and international development reinforcing each other. These methods will help to make a good start for the development of a modern socialist China in all respects. Thank you.

Shou Xiaoli:

Now, the floor is open for questions. Please identify your news outlet before you raise your question.

CCTV:

What progress and achievements has China made in the manufacturing industry during the 13th Five-Year Plan period? How does the Ministry of Industry and Information Technology evaluate these accomplishments? Thank you.

Wang Zhijun:

The manufacturing industry is the lifeblood of China's economy and of critical significance to long-term national development. Whether it's in building a moderately prosperous society in all respects or in the new upcoming journey of building a modern socialist country, the manufacturing industry has always and will always shoulder lofty responsibilities and have major missions to perform. During the 13th Five-Year Plan period, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the industry and information technology sector has fully implemented the policies and arrangements of the CPC Central Committee and the State Council and made solid progress in building China into a manufacturer of quality products. Remarkable achievements have been made in this regard. I'd like to summarize the accomplishments in five aspects: continuously leading the way in terms of growth, solid results achieved in innovation, significant structural improvements, faster growth of enterprises, and increased levels of opening-up. To prove these five statements, I'd like to share some data with you.

First, comprehensive strength has been further enhanced. From 2016 to 2019, China's total value-added in industry increased from 24.54 trillion yuan to 31.71 trillion yuan, registering an average annual growth rate of 5.9%, much higher than the world's 2.9% during the same period. In 2019, our value-added in the manufacturing industry accounted for 28.1% of the global total, up 1.8 percentage points from 2015, with China remaining the world's largest manufacturing country for 10 consecutive years. At present, China is the only country in the world that has 41 major industrial categories, 207 medium industrial categories, and 666 industrial sub-categories in the United Nations' International Standard Industrial Classification of All Economic Activities (ISIC). For the first nine months of this year, the total added value of industry above designated size grew by 1.2% year-on-year, and that of the third quarter grew by 5.8%, showing a recovery trend quarter by quarter.

Second, innovation capacity has been significantly increased. In 2019, the investment of our industrial enterprises above designated size in research and development (R&D) reached 1.32% of GDP, up 0.42 percentage points from 2015. A manufacturing innovation network with 17 national manufacturing innovation centers as the core and over 100 supplementary provincial centers has taken initial shape. In 2020, China ranks 14th on the Global Innovation Index of World Intellectual Property list, up 15 places from 2015.

Third, industrial structure has consistently improved. The steel industry achieved its 13th Five-Year Plan target of cutting overcapacity by 150 million tons two years ahead of schedule. Demonstration and application of smart manufacturing has been accelerated. By June 2020, the penetration rate of digital tools for R&D and design as well as the numerical control rate of critical processes for enterprises in key areas of the manufacturing industry stood at 71.5% and 51.1%, respectively, up 14.8 and 3.8 percentage points from 2015. The value-added in high-tech manufacturing and equipment manufacturing accounted for 14.4% and 32.5%, respectively of the total value-added in industry above designated size, 2.6 and 0.7 percentage points up from 2015, constituting a major driving force in manufacturing development.

Fourth, high-quality enterprises have grown faster and leading enterprises have continued to gain global competitiveness. Leading companies with strong innovation capacity and international competitiveness have emerged in the fields of information and communications, rail transit, new energy vehicles, etc. Thirty-eight Chinese manufacturing companies are on this year's Fortune Global 500 list, ranking first in the world for the most companies listed from one country. Eighteen Chinese manufacturing brands entered the world's top 500 most valuable brands list this year. Additionally, 14 Chinese companies made it onto Forbes' top 100 digital companies list in 2019.

Fifth, China is opening up further. Restrictions on general manufacturing sector are being removed in an orderly manner. Caps on ownership in automobile, shipping, and aircraft sectors are being gradually lifted.High-speed railways, nuclear power, and satellite systems are gradually going overseas. In 2019, China's industrial products were exported to nearly 200 countries and regions, with exports accounting for 71% and 21% of China's total exports and global demand, respectively, occupying a key position in the global industrial chain and supply chain. By the end of 2019, China had signed industrial capacity cooperation agreements with more than 30 countries along the Belt and Road routes and over 70 overseas economic and trade cooperation zones had been established. Thank you.

Red Star News:

During the 13th Five-Year Plan period, cheaper and faster internet access — which is related to people's sense of gain — has brought about many changes to the lives of ordinary Chinese. Could you explain what achievements have been made in this regard in recent years? Thank you.

Wen Ku:

Thank you for your question. Boosting broadband speeds and lowering internet service rates are not only "gifts" for our people, they are also important steps in driving consumption, advancing entrepreneurship and employment, and promoting the transformation and upgrading of the national economy. In 2016, General Secretary Xi Jinping stressed accelerating popularization of information services to offer the general public accessible, affordable and quality services. In this way, hundreds of millions of Chinese people can have a stronger sense of gain in sharing the fruits of internet development. Since the beginning of the 13th Five-Year Plan period, we have done much work in this regard. The main achievements have been as follows:

"Accessible" refers to the availability of internet services; "affordable" indicates lower charges for such services; and "quality services" mean fast and smooth internet connections. To achieve these three goals, we improved the network performance. Currently, China's internet development is leading the world.

First, the network capability has been significantly improved. In 2015, we began speeding up broadband, cutting internet service fees, and vigorously promoting the construction of high-speed broadband, notably fiber optic and 4G. In 2019, the MIIT launched an action plan to pushing both fixed and mobile network into the gigabyte era, as well as increasing both the proportion of broadband users of 100MB or more and the penetration rate of 4G subscribers, accelerated the development of gigabyte fiber optic and 5G, and constantly improved the capacity of broadband infrastructure services. Thanks to the combined efforts of various parties during the 13th Five-Year Plan period, China has established the world's largest information and communication network. Now, our 4G base stations account for more than half of the world's total. Starting from last year, we have also built more than 690,000 5G base stations in under one year.

Second, network rates have multiplied. With technology evolving and upgrading as well as previously existing network infrastructure, our network rates have multiplied. Over the past five years, the share of fiber optic communication users has risen from 34% to 93%. In addition, the proportion of 4G subscribers grew from 7.6% to the current 81%, well above the global average. According to recent data from the Broadband Development Alliance, the average end-to-end download speed for fixed broadband and 4G in China registered a more than sevenfold increase from 2015. The end-to-end rates of our fixed network and mobile network (4G) now stand at 43MB and 29MB respectively, markedly improving the user experience.

In terms of affordability, we have done a lot of work to cut telecommunication prices.

First, people's sense of gain has been enhanced. We encouraged enterprises to introduce various preferential fee programs, cancelled domestic long-distance and roaming charges for cellphones as well as data roaming charges, adopted such measures as "rollover data services" (allowing users to carry forward unused monthly data allowance) and "increasing the internet speed but not service fees," and rolled out the "floor price" scheme to meet the demand of low-income and elderly groups. We have offered the maximum discount to households registered as living under the poverty line and assisted in targeted poverty alleviation with regard to networks. We helped reduce the production and operating costs of enterprises and boosted the development of the real economy. Over the past five years, average charges for fixed broadband and cellphone data in China have dropped by more than 95%, to only a fraction of what they were five years ago on a unit price basis. These diverse measures have benefitted over one billion cellphone and communication users every year, thereby increasing people's sense of gain.

Second, popularization and application of the internet have been advanced. Previously, cellphone users would often search for free Wi-Fi when they visited somewhere new, but they no longer do so because data fees are much cheaper now. This is the benefit that the majority of our users can feel most. The lowering of charges and fees has promoted the popularization and application of the internet. The average monthly data consumption of each user is now 10.86GB, which is 38 times higher than that of 2015. Back then, cellphone users consumed an average of just 287.9MB of data per month, typically only enough for two episodes of a comedy series. Various mobile apps are being popularized rapidly, and basic services such as e-commerce, fast mobile payments as well as innovations in the fields of internet combined with education, healthcare and elderly care are constantly being made, making the government's public services more systematic and efficient.

Furthermore, by deepening integration and application, the digital economy has achieved leapfrog development.

First, it gave birth to the development of emerging industries. The boosting of broadband speeds and lowering rates for internet services has promoted the rapid development of the internet industry. Various applications such as online shopping, online education, mobile payments, and short video sharing have fully influenced our everyday life. There are seven internet companies in total on the latest Fortune Global 500 list, four of them are from China: JD.com, Alibaba, Tencent, and Xiaomi.

Second, it injected new impetus to traditional industries. In recent years, thanks to the strong support of network infrastructure and accelerated integration of information and communication technology and the real economy, more and more industries have become "intelligent." Intelligent manufacturing, intelligent agriculture, intelligent tourism and other new integrations and applications have sped up the transformation and upgrading of traditional industries, helping more and more industries to enter the information highway. Driven by new information and communication technologies and new forms of business, China's digital economy has gained a strong growth momentum. In 2019, the economic aggregate of digital economy reached 35 trillion yuan ($5.23 trillion), accounting for 36.2% of China's GDP and aggregately contributing 67.7% to GDP.

While the urban broadband network is developing rapidly, we are focused on the construction of broadband networks in rural and remote areas. During the 13th Five-Year Plan period, in accordance with the general principle of "the central government guiding with funds, local governments coordinating and supporting, enterprises and entities promoting," the central government increased fiscal investment, and basic telecommunication enterprises actively played their "national team" role and constantly increased investment in rural construction. Over the past five years, thanks to the concerted efforts of all involved parties, more than 98% administrative villages and poor villages in impoverished three regions and three prefectures have been equipped with fiber-optic cables and 4G networks. The speed of fiber optic network in those pilot administrative villages reached 70Mbps and up. The level of information infrastructure has been rising in rural and remote areas, and internet speeds there is just as fast as it is in cities. Emerging industries including rural e-commerce, rural tourism, and intelligent agriculture sprang up, while high-quality public resources extended to rural areas and the "digital divide" between urban and rural areas was markedly narrowed. All of these achievements are praised by the public as "happiness at our fingertips."

On one hand, we will further promote the speed and quality of networks, and speed up its evolution and upgrading. On the other, we will encourage basic telecommunication enterprises to continuously cut fees and improve their quality and level of service to meet all of this year's targets as well as the new demands for the integrated development of information technology with the economy and society in general.

Economic Daily:

During the 14th Five-Year Plan period, China will build a new, dual-cycle development architecture with the domestic cycle as the mainstay and with domestic and international development reinforcing each other. What's the MIIT's plan for the next year to get a head start on the 14th Five-Year Plan? Thank you.

Wang Zhijun:

This is a very important question. Today's world is undergoing profound changes unseen in a century. This year, the unexpected COVID-19 pandemic has accelerated such changes. In the 14th Five-Year Plan period, China will enter an important period of strategic opportunity during which much can be achieved. Meanwhile, the international community is experiencing profound changes in economic, scientific and technological, cultural, security, and political areas. Next year is the first year of the 14th Five Year Plan and also the first year in which we will embark on a new journey towards the Second Centenary Goal of building China into a modern socialist country. Following the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, our industrial and information technological departments will fully implement the decisions and arrangements made by the CPC Central Committee and the State Council, foster the spirit of winning, carry out pragmatic measures, stimulate innovative vitality, seek breakthroughs in reform, and fight actively for a good start to the 14th Five-Year Plan.

Next year, guided by the new development philosophy and the theme of promoting high-quality development and pursuing supply-side structural reform as main task, we will implement guidelines in "consolidating, strengthening, upgrading, and ensuring unimpeded flows," and unswervingly build China into a major country in areas of manufacturing and cyberspace.We will strengthen independent innovation, promote a high-level industrial base and modern industrial chain, set up a batch of national pilot zones for manufacturing high-quality development and advanced manufacturing clusters, and cultivate a group of excellent enterprises with global competitiveness. We will enhance quality, efficiency, and core competitiveness in industry and information technology development, and step up efforts in middle and high-end industrial chains. We will provide higher quality industrial products and better information and communication services to satisfy the people's growing needs for a better life, to build a new, dual-cycle development architecture with the domestic cycle as the mainstay and with domestic and international development reinforcing each other, and support to build China into a modern socialist country. Thank you.

Hong Kong Economic Herald:

China's digital economy has flourished in recent years, becoming a new driver for economic growth. My question is, what steps have the Ministry of Industry and Information Technology taken to boost the digital economy? Thank you.

Wang Zhijun:

I would like to invite Mr. Lu Shan to field this question.

Lu Shan:

Thank you for your question. I will give some figures to show how China's digital economy has grown during the 13th Five-Year Plan period. During the period, the Ministry of Industry and Information Technology has steadily advanced the digital economy in accordance with the plans of the CPC Central Committee and the State Council. Just as Mr. Wang and Mr. Wen has said, China's digital economy expanded from 11 trillion yuan at the beginning of the period to 35.8 trillion yuan in 2019, that is, 36.2% of China's GDP. Good results have been achieved, which can be seen through the "industrial transformation of digital technologies" and the "digital transformation of industries," as I will detail next.

First, the industrial transformation of digital technologies. For this, I'd like to use the example of internet infrastructure, which is a major area of industrialization. During the 13th Five-Year Plan period, we have built the world's biggest fiber-optic and 4G network, and are in the process of deploying the 5G network. Hardware and software are also important areas that have undergone industrialization. As you can see, during the 13th Five-Year Plan period, besides traditional laptops, desktops, and servers, we also saw a growing number of smartphone apps coming into use, including the very voice recorders that you are using at this press conference that can not only recognize speech but also connect to the internet. The software industry has made a huge contribution to the digital economy during the 13th Five-Year Plan period. In 2019, it registered another rapid annual growth of 15.4% to reach a revenue of 7.2 trillion yuan. In addition, we have seen a large number of enterprises coming forth and providing solutions related to the digital economy. We also successfully pushed for the building of eight national comprehensive experimental zones for big data, 11 national demonstration centers for the new industrialization of big data, and 13 software cities, which now serve as important bases for China's software industry and the digital economy.

Second, the digital transformation of industries. E-commerce and mobile payment platforms have boomed. Manufacturing and the industrial sector as a whole have also made good progress. For example, we have built over 70 influential industrial internet platforms, which connect to 40 million sets of industrial equipment. The number of industrial apps has exceeded 250,000. These are all typical examples of the digital transformation of industries. We have selected over 400 pilot and demonstration programs for digital transformation in the fields of industry, government service, and livelihood initiatives.

To boost the digital economy, we have also made efforts in the following two aspects. One was to create a more favorable environment for development. During the 13th Five-Year Plan period, we adopted the Big Data Industry Development Plan (2016-2020) and the Guidelines on Industrial Big Data Development. We also set up software schools with different focuses to develop new engineering disciplines and train digital economy talents. We also gave guidance to the release of 24 big data-related national standards and held exhibitions. Second, we expanded openness and international cooperation. This was achieved through an active emphasis on digital economy cooperation to strengthen strategic mutual trust and deepen pragmatic cooperation through the G20 and BRICS, as well as China-Europe, China-ASEAN, and China-Russia relationships, and other multilateral and bilateral mechanisms.

During the 14th Five-Year Plan period, the ministry will continue to accelerate high-quality development of the digital economy, promote the industrial transformation of digital technologies and the digital transformation of industries, improve the development environment, and seek higher standards of openness and cooperation.Thank you.

People.cn:

The 13th Five-Year Plan sets out precise requirements for constructing a new-generation information infrastructure. How's it going on so far? I also noticed on a message board on People.cn that some people are dissatisfied with the current development of the industry and information technology sector, and some do not understand why 5G base stations are built in residential communities. Some netizens also suggest improving relevant apps and notifications on mobile phones. What will MIIT do next? How will you improve people's satisfaction and sense of gain during the upcoming 14th Five-Year Plan period? Thank you.

Wen Ku:

Thanks for your questions. I just introduced the achievements in information and communications infrastructure made during the 13th Five-Year period. The Chinese government highly values the construction of information and communications infrastructure. Its strategies of "Broadband China" and building China's strength in cyberspace place information and communications infrastructure in an equally important position as those of water, electricity and roads.

We mobilized all sectors and the whole society to boost the construction of information and communications infrastructure. During the 13th Five-Year period, we established a principle of being moderately proactive. From copper fibers to optical fibers, from 3G to 4G, and from 4G to 5G, we have built up  world-class, high-quality and economical communication networks, granting people access to all kinds of networks, technologies and applications.

First, we followed a clear path of moderately proactive construction. Since 2015, we have taken actions to speed up broadband and lower internet rates for four consecutive years and construct role-model cities to implement the "Broadband China" strategy and develop optical networks. Last year, we launched policies to raise both fixed and mobile broadband to the gigabit level and expand the number of 4G and broadband users. We published requirements for the construction of gigabit network for a hundred of cities initiative and helped improve local policies. Since the beginning of the 13th Five-Year period, we have built up the largest communications network in the world, with 4G base stations all over the country and over 80 million users of gigabit-level optical fibers. The Internet speed doubles with the upgrade of technologies and networks, as well as with the proactive construction of the infrastructure. These figures are very impressive.

Second, we provided universal services to deal with weaknesses. Since 2015, we have launched pilot universal telecommunications services in six batches, together with the finance authority. In rural areas, we have extended optical fibers to village committees, schools and hospitals and covered every corner with the 4G network; we have also offered villagers a series of preferential policies in broadband fees. During the 13th Five-Year Plan period, the proportion of optical fibers in administrative villages increased from 70% to 98%, and people there enjoy the same network and speed as city residents.

Third, we speeded up IPv6 development. The development of the next-generation internet based on IPv6 is an important step and an inevitable trend and is of great long-term significance to improve internet capacity and services. The general offices of the CPC Central Committee and the General Office of the State Council released an action plan for IPv6 development in 2017. Since then, with various localities, government departments and related companies working together, the upgrading of the IPv6 for fixed broadband and mobile LTE networks in China has been completed. The quality of IPv6 network is now much the same as the previous IPv4 network. In 2018, the number of users who had access to IPv6 addresses was 74 million. By September this year, it was 1.457 billion. IPv6 traffic on the LTE network is also growing rapidly, accounting for 1.7% of the total last year and jumping to 13% this September.

Next, we will shift from universal coverage to high-quality development. This work can be divided into three aspects. First, we will continue building the infrastructure for raising both fixed and mobile broadband to the gigabit level and accelerate 5G development. We will make innovations in network slicing and virtual private networks for industry, improve network coverage, promote the construction and upgrading of the gigabit-level optical fiber network and improve the overall loading capacity of communications networks. Second, we will push forward pilot projects of universal telecommunications services. On the basis of achieving the goal of winning the battle against poverty, we will continue to effectively synchronize poverty eradication with rural vitalization and further deepen network coverage in rural and remote areas, letting more villagers better enjoy the fruits of IT development. Third, we will promote innovations in application. We will focus on application innovation of 5G and gigabit-level optical fibers and dig into vertical industry demands, while encouraging broader and deeper collaborative innovation between the information and communications industry and transportation, medical care, energy, education, and other industries, so as to constantly enrich application scenarios and build an ecosystem with wide applications. That's all.

Regarding the question just now, some people do not understand why 5G base stations are built in residential communities. The most important thing is that the two sides should strengthen communications. From a technical perspective, we attach great importance to the health of the people. In terms of technical indicators, when building base stations, our requirements to limit radiation are stricter than those of other foreign countries. You can see the specific indicators from relevant standards and we are cooperating with departments concernedto strictly follow these indicators.

Regarding difficulties in building base stations in communities, we have done a lot of work. Recently, we have worked with several ministries and commissions to jointly resolve those difficulties as well as the problem of "the last 100-meters" broadband access.

Regarding the issue of not allowing entry, we have seen that it is very difficult for operating companies to resolve these difficulties. In some areas, operating companies have jointly issued certain announcements. We also regret this. Operating companies should do more work in persuading residents, and explain to them properly because many people have the need for information services.

Guangming Daily:

What achievements have been made concerning China's major technical equipment in recent years? What can be called "new business cards" made in China?

Lu Shan:

Thank you for your questions, I will elaborate on the progress of China's major technical equipment during the 13th Five-Year Plan period. Major technical equipment are connected to the lifeline of the national economy and national security, and they are generally basic and strategic products. The development of major technical equipment sector reflects the development capabilities and level of a country's manufacturing industry. During the 13th Five-Year Plan period, we have made many great achievements.

First, breakthroughs have been made in a number of high-end equipment related to the national economy and people's livelihood. You may already be very familiar with the Tianwen-1 and BeiDou-3 satellite system mentioned in Mr. Wang's speech just now. Mr. Wang also mentioned the two polar scientific research ships, Xuelong and Xuelong 2, which both traveled to the Antarctic for scientific expeditions and research, and are the most advanced scientific research ships. There is also the offshore drilling platform "Blue Whale One," which is now the most advanced offshore drilling platform in the world, and successfully exploited combustible ice this year. In addition to those achievements in the arenas of sky, sea, and earth, there have also been breakthroughs in our processing capabilities. Notable examples include the five-axis mirror machine, which is an important tool for symmetrical processing, and equipment that allows for large-scale liquid-filled stretching of 15,000 tons of aerospace components, as opposed to the previous method of welding. Therefore, a large number of equipment has reached internationally advanced levels.

Second, as Mr. Wang shared with you just now, our high-speed trains now "go global," our nuclear power facilities "go global," and our satellites "go global." In addition to these, I would like to share with you an example closer to us. During the pandemic outbreak, many medical and protective materials "went global," and many medical devices have also successfully gone global. An example is the world's first two-meter-long total body PET-CT, developed by Shanghai-based United Imaging Healthcare, which has been used in scientific research institutions in the United States. In addition, some China-made CT machines, nuclear magnetic resonance machines and linear accelerators have been sold to more than 10,000 medical companies in more than 110 countries around the world. This shows that many of our "new business cards" have been recognized by people all over the world.

Behind these two aspects is the emergence of several internationally competitive leading companies. I can give you examples: rail transit equipment produced by CRRC Corporation Limited, shield tunneling machines produced by China Railway Construction Corporation and China Railway Construction Heavy Industry Corporation, cranes produced by Xuzhou Construction Machinery Group, Shanghai Zhenhua Heavy Industries Co.'s port machinery, TBEA's UHV transmission and transformation equipment, and high-efficiency and clean power generation equipment produced by the three power corporations of Harbin Electric Corporation, Dongfang Electric Corporation, and Shanghai Electric Group. The competitiveness of this equipment in the global market has been greatly improved. In addition to the rise of these suppliers of complete-machines and systems, we have witnessed that there are also a large number of enterprises involved in specialization, refinement, innovation, as well as "little giant" enterprises (medium and small-sized enterprises with great potential, leading R&D and boast good market shares) that are supporting from behind the scenes.

These are the achievements in major equipment made during the 13th Five-Year Plan period. We believe that with the high-quality development of China's manufacturing industry during the 14th Five-Year Plan period, there will be more and more "new business cards" that will benefit the people and be recognized by the world. Thank you.

CNR:

Small and medium-sized enterprises (SMEs) are the backbone for national economic and social development. In recent years, our country has introduced a series of policies and measures to support SMEs. Could you please elaborate on the efforts made by the Ministry of Industry and Information Technology (MIIT) in this regard during the 13th Five-Year Plan period? Have those supportive measures been effective? What measures will the MIIT adopt to further promote the healthy development of SMEs? Thank you.

Wang Zhijun:

Thank you for your questions. While attaching great importance to large-scale leading enterprises, such as CRRC, China Mobile and Huawei, we should pay equal attention to the large number of micro, small, and medium-sized enterprises (MSMEs). MSMEs are: a primary contributor to national economic and social development; an important source of technological innovation; and provide vital support to expanding job opportunities and improving people's livelihoods. Promoting the development of SMEs is hugely important to ensure stability on six fronts (employment, the financial sector, foreign trade, foreign investment , domestic investment, and expectations) and maintain security in six areas (job security, basic living needs, operations of market entities, food and energy, stable industrial and supply chains, and the normal functioning of primary-level governments).

The State Council has established a leading group on promotion of  the development of SMEs, and its office is located in the MIIT. During the 13th Five-Year Plan period, the MIIT has earnestly performed the duties of the office, played its full part in its coordinating role, and made solid progress in promoting the development of SMEs. In general, we have concentrated our efforts on the following three aspects during the 13th Five-Year Plan period, and tangible results have been achieved.

First, we have promoted the establishment of systems to provide legal and policy support to SMEs. The business environment is crucial to enterprises, while a complete system of relevant laws and regulations plays a very important role in creating a business environment conducive to the regular operation of enterprises. Currently, after years of effort, a system of supportive laws and regulations has taken shape at national level, which consists of "one law, one regulation and two guidelines." "One law" refers to the Law of the People's Republic of China on Promoting Small and Medium-Sized Enterprises, which was amended in 2017. The MIIT had taken part in the entire process of the law amendment and carried out an inspection on the law enforcement last year together with the Standing Committee of the National People's Congress in order to promote the implementation of the law. "One regulation" refers to a newly-released regulation on ensuring timely payments to SMEs. The regulation is very important. It is a concrete measure to implement the law on promoting SMEs and enhance the protection of the rights and interests of SMEs. In fact, many countries have similar laws and regulations. "Two guidelines" are respectively the guideline on promoting the healthy development of SMEs issued by the General Office of the CPC Central Committee and the General Office of the State Council in 2019, and the guideline on improving systems for providing support to SMEs released by 17 government departments, including the MIIT and the National Development and Reform Commission (NDRC) this year. The two guidelines focus on solving major problems SMEs are facing right now and push forward the building of a regular and long-term mechanism to promote the development of SMEs.

Second, we have promoted the specialization of SMEs. The specialization of enterprises, especially of SMEs, represents a general trend across the globe. The efforts made by China in this regard mainly include improving the systems for cultivating SMEs in a phased manner to cultivate outstanding SMEs. 27 competent authorities nationwide in provincial regions, including municipalities with independent planning authority with a high level of industrial development and the Xinjiang Production and Construction Corps, issued methods for defining cultivation of outstanding SMEs. Enterprise cultivation centers have been established in 29 provincial regions, nurturing more than 60,000 SMEs. At present, more than 20,000 enterprises have been defined as outstanding SMEs at provincial level. The MIIT released the first batch of 248 "little giant enterprises" at national level. They were selected from among the outstanding SMEs. Each of them focuses on a market niche and masters key technologies and has a strong innovative capacity and a big market share. The ministry is now organizing the cultivation of the second batch of "little giant enterprises."

Third, continue improving the public service system for small- and medium-sized enterprises (SMEs). SMEs are not as strong as large companies and require assistance and support in the public service sectors. The MIIT has cultivated and identified 657 national public service-based demonstration platforms designated for SMEs and 329 national entrepreneurship and innovation-oriented demonstration bases for small- and micro-sized enterprises. Over 3,600 provincial-level demonstration platforms and more than 2,400 provincial-level entrepreneurship and innovation demonstration bases for micro firms have been established. We support 101 real-economy development zones in developing integrated large-, medium- and small-sized enterprise accommodation carriers with distinctive features and promote more than 100,000 service sectors to offer good and convenient services forSMEs. Meanwhile, we have entrusted third party organizations to conduct development environment assessments of SMEs, to ensure an optimized growth environment.

Next, we will strengthen our efforts to actively cooperate with members of the State Council Leading Group for Promoting the Development of Small and Medium-sized Enterprises and carry out policies to ensure that SMEs are innovation-oriented and of high quality. Thank you.

Shou Xiaoli:

Now, we'll take the last question.

The Cover.cn:

In recent years, the fast growth of the industrialInternet industry has been playing an increasingly significant role in the national economy. As such, how has the industrial Internet industry developed during the 13th Five-Year Plan period? And what efforts will be made going forward? Thank you.

Wang Zhijun:

The Internet industry, and particularly the industrialInternet industry, is always a hot topic when it comes to high-quality development. I would like to invite Mr. Wen to answer your questions.

Wen Ku:

Since the publishing of the State Council's Guiding Opinions on Enhancing the "Internet + Advanced Manufacturing" and Developing Industrial Internet, significant achievements have been made in the industrialInternet community. Innovation-oriented projects concerning the industrial Internet are running smoothly, with high-quality outer networks featuring low time-delay, high reliability and wide coverage reaching over 300 cities, connecting more than 180,000 industrial enterprises, accelerating the "5G+Industrial Internet" 512 Project, with local basic telecom firms actively cooperating with industrial enterprises and over 800 projects under construction. Our efforts include: breakthroughs in the identification resolution system and the establishment of national top nodes in the five big cities of Beijing, Shanghai, Guangzhou, Wuhan and Chongqing. In addition, 75 secondary nodes are running online, more than 70 influential platforms have been built, 40 million industrial installations have been connected, safety capacity has been greatly improved, over 30 key industries have been covered by integrated-application, and five new models — smart manufacturing, network cooperation, customized, wide-range service and digital management — are actively innovated with high quality and low cost. In addition, thescale of industrial Internet reached 3 trillion yuan ($447 billion); integrated industrial connections have been strengthened, with members of the Alliance of Industrial Internet reaching 1700; cooperation between relevant technologies, standards, R&D and applications has been enhanced, and its pillar rolehas gradually emerged in the digital transformation of the manufacturing industry as well as high-quality development of the real economy.

Going forward, the MIIT will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly put into practice the decisions and plans of the CPC Central Committee and the State Council, and promote the innovation-driven development of the industrial internet. We will maintain a strategic focus and coordinate our efforts to do the following:

First, strengthen the development of the network, platform, and security systems. We will develop a high-quality network system for the industrial internet.Guided by the 512-project promotion plan for "5G + industrial Internet," we will continue to upgrade the intranet and extranet of enterprises, grow identity resolution systems, and expand the application of the systems. We will improve the industrial internet's platform by building a large data center and promote cloud services for enterprises. In addition, we will further increase the security capacity of the industrial internet.

Second, deepen integrated and innovative applications. We will build demo centers and pilot programs for the application of the industrial internet and encourage its innovative application within enterprises. We will foster and promote new models and new forms of business, such as intelligent manufacturing, internet-based coordination, custom-tailored production, service extension, and digital management, as well as fuel the digital transformation of enterprises.

Third, cement the foundation for industrial development. We will focus on the innovation-driven development of the industrial internet, improve public service platforms, and cultivate system solution providers. We will accelerate the application of new-generation information technology, including 5G, blockchain, and AI in the industrial internet, as well as grow special industries, cement industrial foundations, and modernize industrial internet chains.

Fourth, create a favorable development environment. For the next stage, we will develop policies for the innovation-driven development of the industrial internet. We will press ahead with reforms to streamline administration and delegate power, improve regulation, and upgrade services. We will also optimize the development environment, strengthen the formulation of industrial standards, and enhance industry-finance and industry-education cooperation. Finally, we will promote the sharing of the industrial internet and big data. Thank you.

Shou Xiaoli:

Thank you to Mr. Wang, his fellow speakers, and our media friends. That ends today's press conference.

.

Read in Chinese

Speakers:

Li Xiaopeng, minister of transport

Feng Zhenglin, administrator of the Civil Aviation Administration

Ma Junsheng, director general of the State Post Bureau

Liu Zhenfang, administrator of the National Railway Administration

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office

Date:

Oct. 22, 2020

Hu Kaihong:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). China's transport sector has made remarkable progress during the 13th Five-Year Plan period (2016-2020). I believe people have felt the tangible benefits from it. Today, we are delighted to be joined by Mr. Li Xiaopeng, minister of transport; Mr. Feng Zhenglin, administrator of the Civil Aviation Administration; Mr. Ma Junsheng, director general of the State Post Bureau; and Mr. Liu Zhenfang, administrator of the National Railway Administration. They will introduce the development of China's transport sector during the 13th Five-Year Plan period and answer your questions. First, let's give the floor to Mr. Li.

Li Xiaopeng:

Thank you, Mr. Hu. Ladies and gentlemen, friends from the media, good afternoon. It is a pleasure for us to take part in this press conference and brief you on the implementation of the 13th Five-Year Plan with regards to the transport sector.

General Secretary Xi Jinping pointed out that the 13th Five-Year Plan period is a golden period for developing transport infrastructure, improving service quality, and promoting transformation and development. During this time, we have been implementing Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. Under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, and with wide support from all parts of society and people's active participation, we have been implementing new development approaches and deepening supply-side structural reforms in a united, concerted and determined manner. We anticipate that the targets outlined in the 13th Five-Year Plan will be accomplished, which will provide strong support in winning the battle against poverty and creating a moderately prosperous society in all respects.

The 13th Five-Year Plan period has witnessed the accelerated development of China's transport sector. It is estimated that China's fixed-asset investment in the sector will reach 16 trillion yuan. By the end of the 13th Five-Year Plan period, China's total railway operation length will reach 146,000 kilometers, connecting 99% of cities with a population of over 200,000. China's high-speed railway operation length has reached nearly 38,000 kilometers, ranking first in the world and covering 95% of cities with a population of 1 million and above. China's road network has reached nearly 5.1 million kilometers in length, including 155,000 kilometers of expressways. The length of China's expressways is also the highest in the world, covering 98.6% of cities and prefecture-level administrative centers with a population of over 200,000. The length of high-grade inland waterways has reached 16,100 kilometers, and there are 2,530 berths of 10,000-ton-class or above at costal ports. The length of urban rail transit has reached 7,000 kilometers, and China also has 241 civil airports, covering 92% of prefecture-level cities.

The 13th Five-Year Plan period has witnessed the transport sector's all-round victory in the battle against poverty. Estimates show that during the 13th Five-Year Plan period, over 950 billion yuan of revenue from vehicle purchase tax will have been allocated by the central government to support road construction projects in poor areas, accounting for 68% of the total. This revenue will mainly be used to support the construction of highways in impoverished areas, national and provincial trunk highways, and rural roads. The development of rural roads has quickened during the 13th Five-Year Plan period. By the end of this September, a total of 1.39 million kilometers of rural roads have been newly built or upgraded, with this figure estimated to exceed 1.4 million kilometers by the end of this year. As General Secretary Xi Jinping said, the move to improve rural roads has produced tangible benefits in recent years, bringing more people and wealth to rural areas, especially poor regions, and rallying community support for the CPC. 

The 13th Five-Year Plan period has witnessed the transport sector's firm support in steadily implementing major national strategies. The Beijing Daxing International Airport, the Hong Kong-Zhuhai-Macao Bridge, the Beijing-Zhangjiakou Intercity Railway, the Yanqing-Chongli Expressway, the 12.5-meter deep-water channel of the Yangtze River (from Nanjing to its estuary), and many other major projects have been completed and opened. This has provided firm support to the coordinated development of the Beijing-Tianjin-Hebei region; the construction of Xiong'an New Area, and the Yangtze River Economic Belt; the integration of the Yangtze River Delta, and the Guangdong-Hong Kong-Macao Greater Bay Area; and the ecological protection and high-quality development of the Yellow River basin, the Chengdu-Chongqing economic circle, and the Hainan Free Trade Port. An interconnected framework consisting of six corridors and six channels serving multiple countries and ports has been basically built, contributing to the high-quality development of the Belt and Road Initiative (BRI). 

The 13th Five-Year Plan period has witnessed the transport sector's efforts to improve quality, increase efficiency and reduce costs regarding transport services. High-speed rail has transported nearly 70% of passengers travelling via train, and the punctuality rate of civil aviation has increased from 67% at the end of the 12th Five-Year Plan period to 81.65% in 2019. Reforms of the toll road system have been advanced, and expressway toll booths at provincial borders have been removed, thus greatly improving the operation efficiency of roads. Greater efforts have been made to adjust the transport structure. The railway cargo volume in 2019 accounted for 9.5% of total freight transport, up from 7.8% in 2017. The waterway freight transport volume increased from 14.14% in 2017, to 16.17% in 2019. The annual growth of rail-water freight container transport volume exceeded 20%, and the annual growth of express delivery exceeded 30%. The total volume and growth rate of express deliveries in China have topped the world for five consecutive years. Logistics costs have been reduced by more than 450 billion yuan during the 13th Five-Year Plan period, and the capacity of safety management of all industries has been continuously enhanced.

The 13th Five-Year Plan period has witnessed the transport sector's robust development in new technologies and new forms of business and industry. China ranks among the highest of all countries in terms of technologies for cross-sea bridges and tunnels, deep-water channels, and high-speed railways. Phase IV of the Shanghai Yangshan automated container terminal has been completed. Fuxing bullet trains have officially begun operation. Large passenger jet C919 completed its maiden flight. The BeiDou Navigation Satellite System (BDS) has been applied in related industries. Facial recognition systems have been rolled out for high-speed railways and civil aviation. The number of daily trips for shared bikes has exceeded 45.7 million. New business models have emerged such as ride-hailing, customized shuttle buses, and internet freight transport. Terminals for smart postal and express delivery services have been widely distributed. Drones, unmanned vehicles and unmanned warehouses are being applied in the express delivery sector.

Since this year in particular, in face of the sudden COVID-19 outbreak, over 40 million workers in the transport sector worked in accordance with the Party's commands, and have been able to secure victory against the epidemic. While strictly implementing epidemic prevention and control measures, the transport sector has resumed work and production in a region-specific manner, sparing no efforts to ensure the smooth operation of logistics and supply chains. Firm support has been provided to build connections, ensure supply, and accelerate the pace in establishing a new development pattern. 

Ladies and gentlemen, friends, as China enters the 14th Five-Year Plan period next year, the transport sector will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, implement the new development philosophy, adhere to high-quality development, and establish a new development pattern. The aim is to build China's strength in transportation with wide popularity, strong support and world-leading capacity, and take steps to fully build a modern socialist China. That completes the introduction. Thank you.

Hu Kaihong:

Thanks Mr. Li, and now let's welcome Mr. Feng to give us an introduction.

Feng Zhenglin:

Ladies and gentlemen, friends from media, just now Mr. Li gave us a systematic introduction of the overall achievements of transportation development during the 13th Five-Year Plan period. Now, I would like to make a brief introduction on the development of China's civil aviation industry.

The five-year period of the 13th Five-Year Plan has proved to be very extraordinary and important for the development of civil aviation. Under the strong leadership of the CPC Central Committee and the State Council, the scale of transportation has grown rapidly, the security situation has remained stable overall, and service quality has steadily improved. Guarantee capabilities have been markedly enhanced, and deepening reform has been further promoted. The sector's overall development conforms to the plan, and the comprehensive strength of the sector has stepped up to the front rank globally. China is making efforts to move from a major country to a global power in air traffic.

First, the transportation scale of China's civil aviation industry has grown rapidly. During the 13th Five-Year Plan period, despite the increasing downward pressure of the domestic economy, the civil aviation sector maintained a relatively fast growth rate. From 2015 to 2019, the average annual growth rate of total turnover, passenger and freight transport volume reached 11%, 10.7% and 4.6% respectively. China's scale of air transport has remained the second largest in the world for 15 consecutive years, and the gap to the number one has been narrowing year by year. This year, when the COVID-19 pandemic had a huge impact on global civil aviation, China lead the world in having hit bottom and then rebounded. In September, the total turnover, passenger and freight transport volume recovered to 76.3%, 87.5%, 96.4% respectively of the same period last year. Total turnover of domestic air transport and passenger volume recovered to 96.9% and 98% respectively compared to the same period last year.

Second, accessibility to the airline network has greatly improved. During the 13th Five-Year Plan period, the Civil Aviation Administration of China (CAAC) has taken hub construction as a driving force, actively serving national strategies, supporting local economic and social development, guiding airline companies to optimize their network layouts, and constantly improving the airline network. Up to 2019, there were 234 domestic cities served by regular services and 4,568 domestic air routes (including 111 involving Hong Kong, Macao and Taiwan); there were 167 cities in 65 foreign countries served by regular flights, and 953 international air routes. China has signed bilateral air transport agreements with 127 countries and regions. It has also signed bilateral inter-governmental air transport agreements with 96 countries involved in the Belt and Road Initiative (BRI), and maintained passenger and cargo flights at a regular basis with 54 of them.

Third, the safety level of the industry continues to lead the world. China's civil aviation industry adheres to the bottom line of safety, and has zero tolerance for potential safety risks. It has focused on the grassroots, laid the foundation and practiced the basic skills for safe operations. Through further improving our work style by concentrating on the principles of "reverence for life, rules and responsibilities", the safety governance capability of the whole industry has been greatly enhanced. By the end of September this year, the country had achieved 121 consecutive months of safe flight, total 86.69 million hours of flight time. It has also ensured air defense safety for 18 consecutive years. As for the five-year rolling value of major accident rate per million flight hours of transport aviation, China's civil aviation is 0, while the world average is 0.088. That has enabled the safety level of our civil aviation sector to remain at the forefront of the world.

Fourth, the guarantee capacity of infrastructure has been enhanced significantly. During the 13th Five-Year Plan period, in accordance with the principle of appropriate advance, China has been making efforts to improve functions of international and regional hub airports, promote capacity of large airports, enhance the support capacity of medium and small airports, and build a group of regional and general airports. China is now constructing a modern airport system featuring wide coverage, reasonable layout, advanced functions and intensive environmental protection. The system consists of three world-class airport clusters in the Beijing-Tianjin-Hebei area, Yangtze River Delta region, and Guangdong-Hong Kong-Macao Greater Bay Area; 10 international aviation hubs in Beijing, Shanghai, Guangzhou, Chengdu and Xi'an, 29 regional hub airports, together with a number of non-hub airports, which will meet the anticipated demand created by rapid growth of air transport. Beijing Daxing International Airport, which officially opened in 2019, has become a new power source for national development and new engine for the coordinated development of the Beijing-Tianjin-Hebei region, as well as the construction of the Xiong'an New Area. During the 13th Five-Year Plan period, the expansion projects of 15 large and medium hub airports including Pudong International Airport in Shanghai have been completed. The construction of Chengdu Tianfu International Airport and Jiaodong International Airport in Qingdao, rebuilding and expansion of Guiyang Longdongbao International Airport have been promoted steadily. China's first cargo-oriented airport in Ezhou of Hubei province is under construction. The country's airport network has been improved constantly, and its guarantee capability has been enhanced markedly. At present, there are 39 airports in the country with annual passenger throughput of 10 million, and 11 of them with passenger throughput of 30 million. By the end of 2020, the number of transport airports in the country is expected to reach 241, with 41 new runways, 5.88 million square meters of new terminals and 2,264 new aircraft parking spots being added. This will provide additional capacity of 400 million passengers and a total national capacity of 1.4 billion passengers. In addition, 43 new and expanded airports will be completed, bringing the number of general airports up to 313, surpassing the number of transport airports.

Fifth, the service quality of the industry has improved steadily. During the 13th Five-Year Plan period, CAAC has made great efforts to improve on-time rate of flights. The rate increased from 67% in 2015 to 81.6% in 2019, exceeding 80% for two consecutive years, and reached 87.04% in the first three quarters of this year. CAAC has carried out special initiatives to improve service quality for five straight years. We have promoted "e-ticket" flights, launched a whole-process luggage tracking system, opened the Hotline 12326 for dealing with inquiries and complaints, standardized the price of catering in airports, implemented tiered charge standards for ticket refunds, promoted services for disable passengers, increased servicemen's priority access to flights, and set up an express channel for donated body organs. Through this, we strive to provide a better travel experience and services for all passengers.

Sixth, deepening reform of the industry has been further promoted. During the 13th Five-Year Plan period, CAAC maintained a problem-oriented principle, and promoted development through reforms and deepened the industry reform. We identified 40 specific reform tasks covering 10 aspects, implemented 158 reform measures, and formed an overall framework for deepening reform featuring a "1+10+N" pattern. Breakthroughs were made in important areas and key links, such as reforms of freight rates, regulatory models, reconstruction of the aviation regulation system, and reform of shareholding system of aviation enterprises. Since the beginning of the 13th Five-Year Plan, we have carried out a total of 1,544 reform tasks, and the completion rates in 2017, 2018 and 2019 reached 93.6%, 94.5% and 91.3% respectively. At present, the reform of China's civil aviation industry is still proceeding, the administrative management system is further improving, functions of public service are further strengthening, and its administrative efficiency, regulatory levels and law-based management are also advancing at a faster pace.

Certainly, while noting the achievements made in the past five years, we also acknowledge there are still some weak links in the development of China's civil aviation, which still fall short of the requirements of the central government and the expectation of our people. At present, CAAC is formulating the 14th five-year plan for civil aviation development and the guidelines for the reform of the industry. The sector will resolutely adhere to the bottom line of security, and further promote intelligent civil aviation as the main focus of future development. We will comprehensively enhance the ability of our resource guarantee, create a longer safety period, vigorously improve service quality, and better meet people's diverse air travel demands and development needs of modern aviation logistics, so as to contribute to nurturing a new development pattern that takes the domestic market as the mainstay while letting domestic and foreign markets boost each other. Thank you.

Hu Kaihong:

Thank you, Mr. Feng. Now please welcome Mr. Ma Junsheng, head of the State Post Bureau.

Ma Junsheng:

Ladies and gentlemen, friends from the press, good afternoon. Just now Minister Li gave a general introduction to the transport achievements during the 13th Five-Year Plan period. Now I'd like to add a few points about the development of the postal sector in the past five years, by using a set of data.

Over the past five years, the revenue of the entire postal industry has grown from $403.9 billion in 2015 to $1.1 trillion, a five-year net increase of $700 billion, with an annual growth rate of 22 percent.

Secondly, over the past five years, the industry has created more than one million new jobs, with an annual growth of 200,000.

Third, the annual business volume of express deliveries increased from 20.7 billion in 2015 to over 80 billion this year, quadrupling in five years. Our country's parcel delivery volume exceeds that of the United States, Japan, Europe and other developed economies combined, and our contribution to the world CEP market exceeds 50 percent.

Fourth, the annual number of postal uses grew from 70 billion in 2015 to 150 billion this year.

Fifth, the postal service network has achieved full coverage above the administrative village level, with express delivery outlets reaching 98 percent of the towns and townships. The self-operated international express delivery network now serves more than 60 countries and regions. The industry-wide number of cargo planes for domestic express delivery increased from 71 to 130. More than 400,000 smart boxes for express delivery have come into service.

Sixth, the overall comprehensive strength of enterprises in the sector has increased significantly. China Post Group Corporation ranks 90th among the world's Fortune 500 companies. Seven express delivery companies have been listed through restructuring, among which three branded ones exceeded 100 billion yuan in their business revenue this year. That's all. Thank you.

Hu Kaihong:

Thank you, Mr. Ma. Now please welcome Mr. Liu Zhenfang, head of the National Railway Administration.

Liu Zhenfang:

Ladies and gentlemen, friends from the press, good afternoon. Just now Minister Li introduced the overall development of transport during the 13th Five-Year Plan period. Now I'd like to add several points about the railway sector.

During the 13th Five-Year Plan period, following the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and under the strong leadership of the CPC Central Committee and the State Council, the railway sector has taken a people-centered approach, adhered to the new development philosophy, advanced railway supply-side structural reform, and strived to promote the high-quality development of the sector. We have achieved the relevant goals set in the 13th Five-Year Plan, and played a leading role in building China into a strong country of transportation, serving the national strategy and promoting socio-economic development.

First, railway network construction has been accelerated. The main framework of the "four vertical and four horizontal" high-speed railways has been completed. The construction of the main channels of the "eight vertical and eight horizontal" high-speed railways, as well as normal-speed railways, have been sped up. Rapid advances have been made in building intercity railways in key regions. A large number of new lines, such as the Beijing-Zhangjiakou Smart High-speed Railway and the Haolebaoji-Ji'an Railway, a heavy-load line for transporting coal from the north to the south, were put into operation. The layout of the national rail network was continuously optimized and the network quality was remarkably increased. The rail network in the central and western regions was constantly improved, with hubs and supporting facilities greatly enhanced. By the end of 2019, the length of in-service railways nationwide had reached 139,000 kilometers, including 35,000 kilometers of high-speed rail lines. A well-balanced, wide-ranging, well-organized, safe and efficient rail network will basically take shape by the end of the 13th Five-Year Plan period.

Second, the quality of transportation has improved significantly. The railway industry has focused on meeting the people's growing demand for railway transport, vigorously implementing structural reform of the railway supply side, and continuously improving transport supply capacity, service quality and safety. From 2015 to 2019, the number of passengers and the volume of cargo transported by rail grew at an average annual rate of 9.6% and 6.9% respectively. The greatly improved transport capacity made it more convenient for passengers to travel and strongly ensured the transport of key materials such as energy and resources. With passenger tickets and cargo bills going digital, railway transport services were improved significantly. The ability to provide emergency support has been significantly enhanced, and transport safety has remained stable, and now our high-speed railways lead the world in terms of safety. 

Third, the level of equipment has been comprehensively upgraded. A high-speed rail construction and equipment manufacturing technology system with independent intellectual property rights has been formed. The Fuxing, China's standard high-speed trainset, has achieved a commercial speed of 350 kilometers per hour, and a series of models has basically taken shape. For the first time in the world, intelligent trainsets have achieved automatic driving at a speed of 350 km/h. The levels of high-power locomotives, heavy-haul vehicles, communication signals, traction power supply, equipment for maintenance, repairing and testing as well as construction machinery and apparatus were greatly elevated. Constant innovations were made to the application of new intelligent technologies.

Fourth, railway reform is gradually deepening. The industry regulatory system is gradually improving, and the transformation of government functions and the streamlining of administration and decentralization of power have achieved obvious result. The reform of the railway investment and financing system has been deepening, and the proportion of investment in railways by local governments and social capital has increased significantly. State-owned railway enterprises have established modern enterprise systems. Companies like Beijing-Shanghai High Speed Railway Co., Ltd. have been listed. The law-based and market-oriented reform of railway transportation has been further advanced, further improving the business environment.

Fifth, international cooperation has been fruitful. In serving the construction of the Belt and Road, China has achieved positive results in the internationalization of railway standards and made new breakthroughs in railway connectivity. The landmark projects of the China-Lao Railway and the Jakarta-Bandung High-Speed Railway have made steady progress. Projects including the Addis Ababa-Djibouti Railway and the Mombasa-Nairobi Railway were completed and came into service. Railway technology and equipment have been exported to more than 100 countries and regions. The rapid development of China-Europe class trains, with a total of more than 30,000 trains by the end of September 2020, has become an important achievement and highlight of the "Belt and Road" construction. Especially this year, faced with unexpected COVID-19 pandemic, the China-Europe freight train has played an important role in promoting the resumption of work and production as well as stabilizing the international supply and industrial chain. That's all. Thank you.

Hu Kaihong:

Thank you, Mr. Liu. Now the floor is open to questions.

CCTV: 

Mr. Li, this year is the final year of the 13th Five-Year Plan. We have noticed that many hard targets have been set in the transportation sector. How have those targets been met in the past five years? From the checking lists, can you report the various outcomes? Thank you.

Li Xiaopeng:

Thank you for asking. Regarding the checking lists, we have two. One list is the 13th Five-Year Plan for Economic and Social Development, which refers to the transport section in the national plan and is composed of three hard targets. The second list is the 13th Five-Year Plan for the development of the modern comprehensive transportation system. This list has 24 indicators, of which four are mandatory and 20 are anticipated. On the whole, we have been able to accomplish the goals and tasks of the 13th Five-Year Plan. Overall, the mandatory targets of the national plan have been exceeded, the obliged transportation section targets have been fulfilled, and the anticipated goals have also been mostly fulfilled. Next, I will check the lists in detail. I'll discuss it in three parts:

In the first part, all hard targets set in the country's 13th Five-Year Plan will be exceeded. Among these three targets, the first is the mileage of newly built or upgraded expressways. The target set was 30,000 kilometers, but we have surpassed the target, building 31,000 kilometers. The second target was to increase the operating mileage of urban rail transit by about 3,000 kilometers. Over 3,000 kilometers have since been completed, also exceeding the target. The third target was to build or renovate 1 million kilometers of rural roads. By the end of September, however, 1.388 million kilometers of roads had been completed, and we're expected to exceed 1.4 million kilometers by the end of this year.

In the second part, four mandatory targets in the comprehensive transport development plan have been successfully completed. The first was to ensure administrative villages have access to tarmac and cement roads. That target was to provide 99% of administrative villages with such roads, and the figure now stands at 99.61%. Among these, 100% of administrative villages with the necessary conditions now have tarmac and cement roads. The second target was to ensure shuttle bus access to administrative villages. While the target was to provide 99% of villages with a bus service, now 99.38% of all villages have bus access. Among them, 100% of villages with the necessary conditions have bus access. The third indicator was that bus stations would be available every 500 meters in cities with a population of over one million. That target is at 100% and has been met. The fourth indicator was the reduction rate of the number of deaths caused by traffic accidents at a serious level or above. That target was 20% but we've managed to reduce the number of deaths by over 20%. Therefore, all these four mandatory targets have been fulfilled.

Third, all anticipated indicators have been mostly completed. They involve highway and waterways. The highway mileage target was 5 million kilometers, while 5.1 million kilometers have been completed. The mileage for expressways was set at 150,000 kilometers, with 155,000 kilometers being completed. The high-grade inland waterway mileage was set at 17,100 kilometers but 16,100 kilometers have been completed, for a completion rate of over 94%. Meanwhile, the target for building 2,527 coastal port berths of a 10,000-ton level or above has been exceeded, with 2,530 being completed. The operating mileage for urban rail transit was set at 6,000 kilometers, which reached 7,000 kilometers. The standardization rate for road freight models of 80% was also exceeded. The annual growth rate for container railway-waterway intermodal transportation was set at 10%, with an actual completion rate of 20% or above. Finally, the target for the digitization rate of basic traffic elements was 100%, which was met; the target for electronic toll collection (ETC) utilization rate for road buses was 50%, but actual completion was 70%, and the target to reduce carbon dioxide emissions from transportation by 7% was exceeded for total reductions of 7.5%.

That's the indicators presented. Now I would like to invite Mr. Feng, Mr. Ma, and Mr. Liu to introduce the achievement of targets in civil aviation, postal service, and railways, respectively.

Feng Zhenglin:

Thank you, Mr. Li. The 13th Five-Year Plan of civil aviation covers 14 indicators involving industry scale, development quality, guarantee capability, and green development. From the perspective of lists checking, these are likely to be completed. I will focus on three indicators that directly relate to people's lives.

First, the aviation safety indicators. Safety is the lifeline of civil aviation and we always place people's safety as a top priority in civil aviation work. We always adhere to a "zero tolerance" policy for any hidden dangers, focusing on safety work by improving "junior staff, groundwork, and basic skills," as well as intensifying efforts to improve our conduct. We vigorously promote a civil aviation regulatory model, shifting from a staff-things orientation to an organization-system approach, keeping an eye on system changes, and firmly sticking to civil aviation security. In the past five years, even as the industry's scale has been growing rapidly, the overall aviation safety situation has remained stable. The five-year rolling average of major accident rates per million flight hours is zero, which is higher than the safety target outlined in the 13th Five-Year Plan and also better than the world's average.

Second, the flight on-time rate indicators. Over the past five years, we have adhered to the principle of controlling total flight volume, strengthening our systems, and constantly strengthening control measures all the while. During the 13th Five-Year Plan period, the on-time flight rate increased by 14.65% compared to the end of the 12th Five-Year Plan period. Additionally, the national average on-time flight rate reached 80.13% in 2018 and 81.65% in 2019. In the first three quarters of 2020, due to the impact of the epidemic, the number of flights was relatively small, and the on-time flight rate reached 87%, fulfilling the 80% development target set in the plan two years ahead of schedule.

Third, the target for air passenger turnover ratio. The 13th Five-Year Plan is a crucial stage for comprehensively strengthening the building of a powerful civil aviation country. We adhere to a guideline of making progress while maintaining stability for our work. We also adhere to supply-side structural reform and promote the high-quality development of civil aviation. The comparative advantage of civil aviation in the comprehensive transportation system has been further enhanced. In 2019, the civil aviation passenger turnover within the nation's comprehensive transportation system increased from 24.2% at the end of the 12th Five-Year Plan period to 33.1% today. This target has therefore been met two years in advance.

However, as for the overall planning goal, we should continue to work on one thing: improving the development of general aviation. According to the original development goal, 500 general airports and 5,000 general aircraft should have been built as well as 2 million flight hours clocked. At present, registered general airports number 313. If we add the number of airports currently undergoing verification and certification, the target could be met. However, only 2,777 aircraft have been built so far, which does not include UAVs (unmanned aerial vehicles). If UAVs were to be included, it would exceed the target. Again, fewer than 2 million flight hours have been achieved but if those of UAVs were counted under general aviation, this figure would have been exceeded. At present, the figure stands at around 700,000 hours.

That's all. Thank you.

Ma Junsheng:

Just now, I introduced some indicators of the developments of our industry during the 13th Five-Year Plan period. We have achieved the goals and tasks we set. One of the tasks assigned by the central government to our postal industry is to cover all administrative villages with direct postal services during the 13th Five-Year Plan period. Before this period, about 36,000 administrative villages, 6.6 percent of all villages, did not have direct access to postal services, most of which are located in the western region, areas with ethnic minority populations, old revolutionary base areas, and border areas. Most of these villages are poor with inconvenient transportation and scattered postal service outlets. To achieve the goal of building a moderately prosperous society in all respects, we have earnestly implemented the original mission of "People's Post serves the People" and for five consecutive years given the priority to the task ofcovering all administrative villages with direct postal services, as part of our agenda to serve the people. We increased investment, optimized the network, and overcame all difficulties. In August of 2019, we finally achieved the goal one year ahead of schedule. So far, villagers in 556,000 administrative villages across the country can receive postal services without leaving their village.

At the same time, we continue to optimize the policy environment to promote the platform and intelligent development of express delivery terminals. The layout of public service stations and smart parcel delivery lockers is also more complete. Nearly 110,000 public express delivery service stations have been built across the country, and 93 percent of the outlets are standardized. These service facilities have played a significant role in this year's epidemic prevention and control. With these facilities, effective package delivery services can be provided. Postmen and couriers can collect packages that senders have dropped off at designated outlets, which effectively reduces their face-to-face contact with consumers and minimizes the risk of spreading the epidemic via the delivery process. That's all I want to add. Thank you.

Liu Zhenfang:

Regarding railways, we have resolutely implemented the decisions and arrangements of the CPC Central Committee and the State Council and fully implemented the 13th Five-Year Plan for Railway Development to promote high-quality development of railways. The Plan puts forward 10 main indicators in three aspects, which will be achieved by the end of 2020.

First, in terms of road network construction, the total commercial mileage of the nation's railwayshas reached 146,000 km, an increase of 25,000 kilometers from the end of 2015; among them, high-speed railways made up 38,000 kilometers, an increase of 19,000 kilometers from the end of 2015. The commercial mileage of railways in the central and western regions cover a distance of 90,000 kilometers. The proportion of double-line railways reached 60 percent, and the proportion of electric railways reached 73 percent. The railway network coverage in cities with populations over 200,000 has reached 99%. The coverage of high-speed rail networks in large cities with populations over one million has reached 95 percent.

Secondly, in terms of passenger and freight transport, in 2019, 3.66 billion people traveled by rail, an increase of 44.4percent from the last year of the 12th Five-Year Plan; the volume of passenger transportation reached 1.47 trillion person-kilometers, an increase of 22.5percent; China railways carried 4.389 billion tons of freight, an increase of 30.7 percent while generating 3.02 trillion cargo ton-kilometers, an increase of 26.9 percent.

Transportation capacity has been significantly improved. Electrical Multiple Units (EMUs) have become the main force in passenger transport. The passenger trips delivered by China Railways High-speed (CRH) trains account for approximately 70 percent of all railway passenger trips. The ratio of online ticket sales exceeds 80 percent.

Third, in terms of green development, we have helped win the "fight to keep our skies blue" and further promoted the adjustment of the transportation structure. The railway freight market share has increased from 7.8 percent in 2017 to 9.5 percent in 2019, and the comparative advantages of railways have been given full play. The energy consumption of railway transport has been further reduced. In 2019, the total energy consumption per unit of railway transport was 3.94 tons of standard coal per million conversion ton-kilometers, down by 16.3 percent from 2015. Great efforts have been made in the comprehensive management of the environment along the railway. The green corridors and the most beautiful CRH trains are becoming well known. The green development of the railway has made significant progress. Thank you.

Li Xiaopeng:

Thank you for the additional information. In general, the briefings showed that we can complete the goals and tasks set in the 13th Five-Year Plan. Here, I would like to thank the whole country and news outlets for their attention and support in the transportation sector. Although we can meet the goals of the 13th Five-Year Plan, there is still work to do if we want to meet the requirements of the CPC Central Committee, people's new expectations for a better life, and the requirements of economic and social development. In the upcoming 14th Five-Year Plan, we will continue to build China's transportation industry to provide good service to our people, ensure reliable operations and maintain our international competitiveness. Thank you.

hb.dzwww.com:

During the 13th Five-Year Plan period, new kinds of transport, such as online car-hailing and bike-sharing, have boomed. Can you tell us what other measures the Ministry of Transport will roll out to promote new kinds and models of transport? Thank you.

Li Xiaopeng:

Thank you for your question. Are you also from new media? It is a new form of industry. The transportation industry is an old-established form of business, but the combination of tradition with new technologies and industries, such as information technology and modern financial services, has spawned many developments in the transportation industry, which have played an important role in serving the people and improving the quality of life. The Ministry of Transport has always attached great importance to these new kinds of business. Taking an inclusive yet cautious approach, we support and encourage the development of new kinds of transportation based on the principles of putting people at the center, fostering innovation, seeking benefit and avoiding harm, and regulating the development.

We have established an inter-ministerial joint meeting system for the coordinated supervision of new kinds of transportation and issued many policy documents for the standardized management of new kinds of businesses to promote their healthy and standardized development. So far, more than 190 online car-hailing platforms have obtained operating licenses, and more than 2.5 million online car-hailing driver licenses and about 1.04 million vehicle transportation certificates have been issued across the country. The online car-hailing services receive about 21 million orders daily. A total of 19.45 million shared bicycles have been put into operation in more than 360 cities across the country. 

As I mentioned just now, the average daily shared bicycle rentals exceed 45.7 million, and the industry's regulation has gradually improved. Regarding vehicle sharing, more than 200,000 vehicles have been put onto the streets of over 180 Chinese cities. Internet-based freight service, another new kind of business, has integrated more than 1.72 million freight vehicles, accounting for 15.9 percent of the total number of trucks in operation. The concentration of the freight market has also increased.

Next, we will continue to encourage and support the development of new kinds of transportation. The first objective is to promote innovation. The second is to promote the integrated development of new and traditional business. The third is to optimize the business environment. The fourth is to ensure safety. Working together with other departments, we will enable these new kinds of transportation to deliver higher quality and better serve the people. Thank you.

Bloomberg News:

Europe's aviation regulator said he's satisfied that changes that Boeing has made to the 737 Max have made the plane safe to fly there this year. Does China agree with this position? And what is the timeline and procedure for the 737 Max to be allowed to fly in China? It's a question for Director Feng.

Feng Zhenglin:

Thank you for your questions. The CAAC has paid great attention to the 737 Max 8 investigation because more jets being grounded in China than in any other country. Of course, regarding the 737 Max 8's return to service, we have maintained technological cooperation and communication with the U.S. Federal Aviation Administration (FAA), the Boeing Company, and the European Union aviation regulator. Boeing's CEO has also talked with me twice about this issue. China was the first to halt commercial operations of all Boeing 737 Max 8 airplanes worldwide following the two fatal crashes. The decision was made based on a zero-tolerance attitude toward safety risks and a high degree of professionalism in safeguarding our aviation security, which demonstrated our strong sense of responsibility toward protecting human life and safety. We have also adopted the same attitude regarding the resumption of flights and the safety of the revised design of the 737 Max 8 must be guaranteed before the airplane resumes operation. When exchanging views with the FAA and Boeing, we proposed three principles for Boeing's flight resumption in China, that is: changes to the airplane's design must receive airworthiness approval; the pilots must be trained fully and effectively, and; results of the investigations into the two crashes must be clear and measures for improvement must be comprehensive. Considering these three principles, we have not set a timetable for resuming 737 Max 8 flights in China. However, we are willing to see the jets return to service as long as they meet these requirements. In the meantime, we continue to enforce a strict evaluation of the airworthiness of these airplanes to ensure flight safety. Thank you.

Thecover.cn:

Just now, Mr. Feng said that the service quality of the civil aviation sector has improved significantly nationwide during the 13th Five-Year Plan period, with various public service measures achieving effective results. Could you please give us more details regarding these results? Thank you.

Feng Zhenglin:

Thank you for your question. In the 13th Five-Year Plan period, China's civil aviation sector has considered the provision of comprehensive sincere service a fundamental requirement to improve service quality, give people a stronger sense of security and gain regarding air travel, and maintain efforts to ensure airport on-time performance and service quality. In particular, we have tried to pursue service quality development by increasing the flight punctuality rate. In the 13th Five-Year Plan period, we were committed to seeking improvement in 12 areas of service, and the relevant work is well underway.

First, we have pledged that flight punctuality would reach 80% in the 13th Five-Year Plan period. As I just said, based on an assessment of the current situation, this goal can be achieved thanks to a series of improvement measures that we have adopted. In particular, we have conducted comprehensive management regarding operational bodies, especially airline companies, airports, and air traffic control sectors, so that an effective flight punctuality system has taken shape. At present, the weather accounts for 60% of all factors that affect flight punctuality.

Second, paperless ticketing has been popularized and is now used at 229 airports and across major airline companies nationwide. Passengers at airports, especially Beijing Daxing International Airport and Beijing Capital International Airport, are likely to have noticed the notably shortened waiting times.

Third, luggage services have been improved. The number of bags that are damaged or sent to the wrong destination has decreased significantly. A network of radio frequency identification devices (RFID) is taking shape, enabling whole-journey luggage tracking on some specified air routes. The technology allows air passengers to follow information about their luggage in real-time after baggage check-in, avoiding the possibility of passengers boarding without their luggage in the cargo hold.

Fourth, transfer services are more convenient. At present, eight airline companies and 29 airports are actively conducting a pilot project on luggage check-through services for domestic cross-airline transfer passengers. This transfer service has seen effective results thanks to an active, responsive system. Moreover, airline companies are actively exploring air-rail intermodality, enabling one-stop ticketing, one-pass customs clearance, and seamless passenger transfers at some airports with railway links. 

Fifth, flight information services have been more standardized. Airline companies and ticket agencies are now implementing strict measures to provide information to ticket buyers, establishing dynamic information systems and processes that offer real-time flight information via multiple means. This significantly improves information service quality during ticketing and check-in procedures.

Sixth, we have adopted tiered pricing for ticket changes and refunds. Currently, 41 domestic airline companies have implemented tiered pricing to ensure more reasonable charges and more efficient services for ticket changes and refunds.

Seventh, catering services at airports have adopted a principle of "same price and quality citywide." We have promoted airports to charge consumers the same price for the same catering services within the same city by implementing various means such as catering industry entry standards, alignment with benchmark prices, and certification of shops with price parity. Meanwhile, we have made efforts to offer greater product variety for in-flight catering services to better meet the need of air passengers. Some airline companies also provide offline meal ordering services for in-flight meals.

Eighth, in-flight Wi-Fi construction has been accelerated. So far, 19 airline companies provide in-flight Wi-Fi on 506 of their aircraft, covering 8.55 million passengers. This service allows air passengers to access the internet on their trips, communicate via WeChat, and use other online amenities.

Ninth, the average passenger self-check-in rate has exceeded 70%. At present, passengers' average self-check-in rate stands at 72% across 37 mega airports in China with an annual passenger throughput of over 10 million. Customer satisfaction remains high through self-check-in machines, online, and via smartphone apps.

Tenth, trial implementation of a new security check has been made gradually. Currently, credit-based security checks have been piloted at 15 mega airports, each witnessing at least 10 million passenger trips each year. At some international airports, including Beijing Capital International Airport and Beijing Daxing International Airport, passengers have experienced one-stop security checks, with customs inspection and civil aviation security checks achieving the same check results.

Eleventh, we have accelerated the application of information technology in aviation logistics. In 2019, nearly 1.8 million electronic air waybills were used, which quickened the pace in promoting the modernization of aviation logistics.

Twelfth, the civil aviation service and complaints hotline 12326 has been put into use. By doing so, we have broadened the channels to handle passenger complaints, with domestic airline companies providing an effective response rate of 100%. 

Meanwhile, we have actively promoted various special services in the 13th Five-Year Plan period. As I mentioned, we issued the Management Measures for Air Transport of Persons with Disabilities, offered exclusive access to military personnel in accordance with the law, established mother-and-baby facilities, and opened a civil aviation "green passage" for the transfer of donated organs which has so far been used 5,149 times.

Generally speaking, all public service installations we pledged have been implemented. Thank you.

CRNTT:

High-speed rail has become a calling card for China, with achievements being witnessed by all. What progress has been made in improving rail transport service to meet the people's expectations for a better life? Thank you.

Liu Zhenfang:

Thank you for your question. During the 13th Five-Year Plan period, we have adhered to a people-centered approach and vigorously implemented supply-side structural reform. Continuous improvement has been made in the supply, quality and safety of rail transport.

First, the quality has significantly increased, enabling people to have a much better travel experience. China has built the world's most advanced high-speed rail network. As you said, it has become a calling card for China, winning universal praise for advanced technology, safety, punctuality, efficiency and sustainability. CRH (China Railways High-speed) is now the most popular mode of transportation among Chinese people.

We have improved the overall quality of rail services and upgraded the supply of passenger transport products. A product series has been created covering passenger trains with boast various classes and operating at different speeds and schedules. We have stepped up efforts to make rail passenger transport more market-based, convenient and informationized. E-ticket, facial recognition, railway applications and other innovative services have been rolled out. Other services including the combination of air transportation with high-speed rail, mutual recognition of security checks and online food orders have become more convenient and efficient. The environment of train stations and coaches as well as the quality of services have noticeably improved. All the efforts are aimed at fulfilling passengers' needs for diverse, personalized and high-quality transport products and services.

Second, we have increased the supply capacity regarding railway freight transport and stepped up market-oriented reforms in the sector. A group of trunk railways including the Haolebaoji-Ji'an, Lanzhou-Chongqing and Quzhou-Ningde lines were opened. The operation of newly built high-speed railways has unleashed the capacity of existing lines and further increased the supply of freight transport services. We have boosted the development of multimodal transport and the combination of water and railway transportation. We have made efforts to promote the construction of industrial sidings and logistic bases to remove barriers in both "the first and the last miles". In response to market demand, we have optimized the supply of railway products, improved a market-based pricing system and promoted development of heavy haul transportation and express trains. Container transport, cold-chain transport and high-speed rail express have become current highlights in the growth of railway freight transportation. We have also promoted the application of electronic receipts and improved the quality of services in this sector.

Third, railway transport has played an active role in enhancing public welfare and combating poverty. We accelerated railway development in poverty-stricken areas of western China. The railway length in central and western China has continuously increased, now accounting for 62% of the country's total. We optimized the allocation of railway capacity. The non-commercial "slow-train" and special train for agricultural produce services were launched to ensure passenger travel and cargo transport in poverty-stricken areas. Express lines were made available for supplies needed in disaster relief, public health emergency responses and national defense transport.

Fourth, the foundation for safety was cemented, enabling the rail network to maintain safe and stable operation. We uphold the principle that people's interests come first and life matters most, so that we have sought to promote safe development, and attached great importance to the safe operation of high-speed and express passenger trains. We strengthened risk prevention and the screening of potential safety hazards as well as increased the capacity of equipment technology to guarantee railway safety. We have been urging enterprises to fulfill their primary responsibilities in ensuring safe production and improving the regulatory system for railway safety. We have taken systematic, comprehensive and concerted measures to improve the environment along railway lines. As a result, the network has been able to maintain safe and stable operations. Thank you.

Red Star News:

It is stated in the 13th Five-Year Plan for postal service development that China will have developed a modern postal service industry that conforms to a moderately prosperous society by 2020. What progress has been made so far? What role has it played in meeting the Chinese people's demand for postal services on their way to a better life? Thank you. 

Ma Junsheng:

Thank you for asking. My answer is that we have achieved positive progress. While making the 13th Five-Year Plan for postal service development, we set out the goal of developing a modern postal service industry that conforms to a moderately prosperous society according to China's national conditions and developmental trends in the world's postal industry. Focusing on this goal, we outlined 18 indicators across five aspects, namely measuring scale of development, service ability, service level, innovation capacity, and competitive strength. So far, all of these goals have been reached, with the exception of the international business ratio, which fell short of our expectation due to the impact of the pandemic this year.

The implementation of the plan has played a great role in meeting the Chinese people's demands for postal services. The past five years have seen the strongest sense of gain among the Chinese people; the fastest growth in industry strength; the most solid links among primary, secondary, and tertiary industries; and the biggest international influence exerted. The fundamental strategic role of the industry has also been significantly enhanced. The postal service industry has given more prominent support to the primary, secondary, and tertiary industries with better services, improved timeliness, wider access, and more comprehensive coverage of businesses. In particular, our efficient and cost-effective postal and express services have helped with the prosperous development of e-commerce. Online retail sales, thanks to the support of the postal service, exceeded 8 trillion yuan last year. The figure is expected to exceed 10 trillion yuan this year. By the end of September, the proportion of total retail sales in consumer goods in China had reached 24.3%, demonstrating the significant role of the postal service. Moreover, our services for modern agriculture and advanced manufacturing are moving toward specialization and extending to high-end industries. Meanwhile, two-way circulation channels have been further opened up in the countryside. Last year, we helped to send industrial products to the countryside and agricultural products to cities, with their total output value surpassing 870 billion yuan. Under the leadership of the Ministry of Transport, the level of coordination and integration between postal and transport services has been significantly improved.

Over the past five years, our infrastructure network has been expanded in an all-round way. We have mainly promoted the construction of express logistics parks and air express freight hubs. A total of 313 new hubs equipped with automatic sorting equipment have been built nationwide, raising the overall level of automation. We have also made great efforts to bring express delivery services to towns and villages. Now, express delivery outlets in rural areas cover more than 30,000 towns. We have also stepped up efforts to develop urban and rural terminal service outlets, and their density has been greatly increased. At present, there are 320,000 postal express outlets in China, equating to one service outlet per every 4,500 people (as calculated for a population of 1.4 billion). Such a high density is second to none in the world.

Over the past five years, we have also made remarkable achievements in innovative development. We are accelerating the application of artificial intelligence, big data, the Internet of Things, and blockchain technology. Our intelligent customer and warehouse service as well as the Beidou navigation technology has been put into use, and we have made breakthroughs in the application of unmanned aerial vehicles, unmanned ground vehicles, and unmanned warehouses, as well as in intelligent security inspection technology. Technological iteration and upgrading has indeed greatly improved our operational efficiency.

Over the past five years, we have greatly accelerated the pace toward an environmentally friendly postal service industry. We have made full efforts in promoting projects "9571" and "9792." In the past, postal express waybills were handwritten; now, there is no such need, as almost 99% of waybills are electronic. This move makes the postal service more environmentally friendly and efficient. In the past, it took us approximately 10 minutes to write a waybill for a single express parcel, but now it takes less than two minutes to process an express parcel. The industry now saves significant resources given that 80 billion express parcels are processed per year.

Over the past five years, the industry's security services have remained stable overall. During the epidemic prevention and control this year, delivery persons fulfilled their duty in the face of the epidemic, guaranteeing normal delivery of epidemic prevention and control supplies and basic daily necessities. In addition, the per capita volume of express parcels in China stood at 45 in 2019 and is expected to reach nearly 60 this year, which is about twice the global average.

Over the past five years, delivery efficiency has also increased steadily. More than two-thirds of China's provincial-level regions have realized same-day delivery of Party newspapers and periodicals to areas at and above the county level. Government services for the convenience of the people such as "Internet Plus Postal Service" have been widely promoted throughout the country. More express delivery businesses have offered products to fulfill their promises. Precise delivery services such as scheduled delivery have also developed rapidly. Multiple delivery means, including home delivery, postbox delivery, and delivery to an outlet have been widely put into application. Customer satisfaction with universal post and express delivery services has also increased steadily.

China News Service:

The newly-built Beijing Daxing International Airport epitomizes the rapid development of medium- and large-sized airports across the country during the 13th Five-Year Plan. Could you please give us an overall view of airport construction during this period? Thank you.

Feng Zhenglin:

Thank you for your question. The construction of airports for civil aviation, which is conducive to the fulfillment of the 13th Five-Year Plan, can be defined by their large-scale, fast construction, large investment and efficient operations. By the end of the 13th Five-Year Plan period, the number of airports across the country is expected to reach 241, with 43 new and relocated or refurbished airports. These include an additional 41 runways, 5.88 million square meters of terminal space and 2,264 more aircraft parking spaces to expand airport capacity to 1.4 billion visits. The number of airports in the country with a capacity above 10 million increased from 26 at the end of the 12th Five-Year Plan to 39 by 2019. In addition, 11 of these have reached a capacity above 30 million. This has substantially improved the shortfalls and limited capacity of key airports. 

Second, construction has progressed quickly. The last five years has seen construction of Beijing Daxing International Airport and refurbishment and expansion of 15 medium- and large-sized airports, including in Shanghai's Pudong New Area, Chongqing municipality, Wuhan and Zhengzhou. You will be aware that Beijing Daxing International Airport, the huge top-level international aviation hub, was completed in four and a half years during the 13th Five-Year Plan period. Having been in operation for less than one year by Sept. 22, the airport has seen throughput of more than 10 million passengers, indicating a good momentum for quality development among large-sized international airports in spite of the pandemic's impact. During the same period, nine airports, including those in Urumqi, capital of Xinjiang Uygur autonomous region; Shenzhen, Guangdong province; Xi'an, capital of Shaanxi province; and Guangzhou, capital of Guangdong province, are being expanded. Renovations to Chengdu Tianfu International Airport, the new Qingdao airport and Guiyang Airport are also all well underway. Construction has started on Ezhou Airport in Hubei province, China's first air freight transport center, with modern engineering management. From my own visits, I can assure you of their utmost advanced information technology and engineering application which guarantee the speed and quality of construction. In addition, the expansion or relocation of a number of small or non-key airports has been completed. The year 2017 marked the most fruitful year in China's civil aviation history with 14 additional runways and 11 new air carrier airports under construction or opening to operations. The approval of the third phase of Guangzhou Baiyun International Airport took only four months before construction started recently.

Third, the investment completion efficiency is high. Fixed investment is projected to reach 460 billion yuan by the end of the 13th Five-Year Plan period, registering growth of 26% over the previous five-year plan. During the past three quarters, investment into fixed assets reached 74 billion yuan, marking a rise of around 20% year on year. This achievement symbolizes our efforts in counteracting the pandemic's impact with project coordination and construction monitoring.

Fourth, construction work has been highly effective. The refurbishment and expansion of many key airports has progressed smoothly. As a result, they have played a significant role in ensuring the support of the once insufficient infrastructure capacities of civil aviation by the end of the 13th Five-Year Plan period. The new projects and plentiful reserve have reinforced the foundation for infrastructure construction during the next five-year plan. Following the requirements of General Secretary Xi, who called on us to build high-quality projects with zero accidents and no corruption, we have resolved to win consent from both the Party and the people with our constructions exemplified in particular by Beijing Daxing International Airport. Meanwhile, based on certain prerequisites, we proposed four additional guiding principles of "safe, smart, green and people centered" for future airports. These principles will be applied to the standards and quality designs as well as the functions and effects of airports in the future. 

In addition, our modern large-sized airports will be included in the construction of holistic transport systems, especially the integration with high-speed railways. Centered around the building of large and essential international airports, we will accelerate the construction of our comprehensive transport system. By 2019, 25 out of 39 airports, each with a capacity of over 10 million, have been connected with 37 rail lines. This development is still continuing.

Fifth, this construction work supports the implementation of national strategies. Since the beginning of the 13th Five-Year Plan period, we have built 31 small and non-key airports, relocated eight small airports and expanded the capacity of 34 airports. Among these, 50 are located in western, border or impoverished areas. So far, 92% of prefecture-level cities, 88% of the population and 93% of GDP are within a 100 kilometer radius of civil aviation services, with these figures increasing by 4.8, 3.6 and 2.4 percentage points respectively during the past five years. This work has contributed to the critical phase of China's poverty-alleviation campaign, the development of the western regions and efforts to boost border areas to allow local people to live in abundance. Thank you. 

CNR:

My question is for Minister Li Xiaopeng. You mentioned that the Ministry of Transport has invested a total of 950 billion yuan of vehicle purchase tax revenue during the 13th Five-Year Plan period in the construction of road projects in impoverished areas. Could you please explain in more detail how this money is being spent? Can you also share some highlights and experiences from your work? Thank you.

Li Xiaopeng:

Thank you for your question. During the 13th Five-Year Plan period, the central government has invested a large amount of vehicle purchase tax revenue in supporting road construction projects in impoverished areas. People are very concerned that where the money has been invested and what the results have been. At this stage, as I just said, investment has exceeded 950 billion yuan. So far, the exact figure is 953.8 billion yuan for highway projects in impoverished areas.

In terms of categories, the investment in expressways is 286.9 billion yuan, the renovation of national and provincial roads is 356.7 billion yuan, and the investment in rural roads is 310.2 billion yuan. In terms of different regions, 60.3 billion yuan has been spent to impoverished areas in east China, 146.3 billion yuan in impoverished areas in the central region, and 747.2 billion yuan in impoverished areas in the west. In terms of results, from 2016 to 2019, we supported the construction and reconstruction of 16,900 kilometers of national expressways in poor areas, 52,500 kilometers of ordinary national highways, construction of around 96,000 kilometers of tarmac and cement roads in natural villages with large populations in poor areas, and completed safety and life protection projects along around 458,000 kilometers of countryside roads. A total of 143,000 kilometers of narrow subgrades and pavements were widened and reconstructed, and around 15,000 dangerously dilapidated bridges were rebuilt. These projects have had very good results.

During this work, our main experience has been that the strong leadership of the CPC Central Committee is the fundamental guarantee for doing this work well. Support from all sides and the efforts of the whole industry are a solid foundation for doing this work well. If you would like to know about specific work experiences, I would say there have been four points. First, raising standards and continuing to increase investment. Second, continuing to work hard and insisting on precise policy implementation. Third, carrying out strict supervision and preventing falsehoods. Fourth, making effective connections with the rural revitalization strategy.

Going forward, the Ministry of Transport will continue to implement the spirit of the important instructions made by General Secretary Xi Jinping on poverty alleviation, and maintain the momentum of poverty alleviation in transportation. We should start well and end well; do positive things and achieve good results. We will not retreat until we have achieved victory, and will make greater contributions for the development of transportation in poor areas. Thank you.

Hu Kaihong:

That concludes today's press conference. Thank you, minister and directors. Thank you everyone.

Li Xiaopeng:

Thank you, Mr. Hu Kaihong.

.

Read in Chinese

Speakers:

Wang Zhigang, minister of the Ministry of Science and Technology.

He Defang, vice secretary of the Ministry of Science and Technology.

Xu Jing, director-general of the Department of Strategic Planning, Ministry of Science and Technology.

Qin Yong, director-general of the Department of High and New Technology, Ministry of Science and Technology.

Wu Yuanbin, director-general of the Department of Science and Technology for Social Development, Ministry of Science and Technology.

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office.

Date:

Oct. 21, 2020

Hu Kaihong:

Ladies and gentlemen, welcome to this press conference held by the State Council Information Office. During the 13th Five-Year Plan (2016-2020) period, we have made major achievements in building an innovation-oriented country. Today, we are glad to invite Minister of Science and Technology Wang Zhigang to introduce the strategy of promoting innovation-driven development and our efforts to build China into an innovation-oriented country before answering your questions. Also present are: Vice Secretary of the Ministry of Science and Technology He Defang; Director-General of the Department of Strategic Planning Xu Jing; Director-General of the Department of High and New Technology in Yong; and Director-General of the Department of Science and Technology for Social Development Wu Yuanbin.

First, let's give the floor to Mr. Wang.

Wang Zhigang:

Good afternoon everyone. Firstly, I'd like to thank the media for your objective and professional reporting on our work on science and technology, as well as your attention and support for scientific and technological innovation. I am so pleased to meet you and share information with you about the scientific and technological innovation progress of the 13th Five-Year Plan.

The 13th Five-Year Plan period is a decisive stage in the building of a moderately prosperous society in all respects, and also a critical period for making China a country of innovators. In the face of a complex and severe international situation and the urgent domestic demand for scientific and technological innovation arising from China's pursuit of high-quality development, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the scientific and technological community have implemented the new development concept and carried out the innovation-driven development strategy. Aiming for the frontiers of science and technology, and to support economic development, meet the major needs of the country, and protect people's health, we have strengthened basic research and application-oriented basic research, made greater efforts to achieve breakthroughs in core technologies in key areas, strengthened efforts to build up China's strategic capacity in science and technology, advanced the reform of the scientific and technological system in a systematic manner, and expanded opening-up and cooperation in the field of science and technology. As a result, our innovation system and environment have improved, and innovation ability remarkably enhanced, playing an increasingly prominent role in supporting and guiding China's efforts to foster a new development architecture and promote high-quality development. The COVID-19 epidemic has further tested our building of the innovation system, our scientific ability and level, technology reserve and emergency response capacity. Chinese science and technology workers demonstrated a strong patriotic spirit, a strong sense of responsibility, professionalism and a high level of ethics in the fight against the epidemic, which are respectable and unforgettable. We have gained more confidence and tenacity for innovative development in serving national rejuvenation and tackling the once-in-a-century changes in the world.

I will share some data with you all. The past five years have witnessed an increase of China's R&D spending from 1.42trillion yuan to 2.21trillion yuan. Investment in R&D has risen from 2.06% of GDP to 2.23%.The basic research spending has almost doubled, and reached 133.6 billion yuan in 2019. We have doubled the volume of contracted technology transactions, reaching over 2.2trillion yuan in 2019. The Global Innovation Index issued by the World Intellectual Property Organization (WIPO) shows that China has leapfrogged from the 29th in 2015 to 14th in 2020. In sum, China has seen improvement in both the quality and quantity of technological innovation, making significant progress in becoming technology country of innovators.

Wang Zhigang:

During the past five years, we have strengthened basic research, made technological breakthroughs in key and core areas, and advanced our technological capabilities. We have achieved a group of important results in various aspects, including quantum information, iron-based superconductivity, stem cells and synthetic biology. The Chang'e-4 probe successfully landed on the far side of the moon; the last BeiDou Navigation Satellite System (BDS) satellite has been launched to complete a global navigation constellation; the passenger aircraft C919 completed its maiden flight; the Dark Matter Particle Explorer Wukong and quantum science satellite Mozi were launched; construction of facilities for magnetically confined nuclear fusion and the China Spallation Neutron Source (CSNS)saw significant breakthroughs, and the layout of the key national laboratories has been speeded up, providing more support to high-level scientific research.

During the past five years, we have deepened the integration of science and technology with the overall development of economy and society, and made fresh progress in supporting and leading high-quality development. Major projects in science and technology have been successfully concluded, and major achievements recorded in mobile communications, new medicine development and nuclear power. The high-speed Fuxing bullet trains are now in operation; the Hong Kong-Zhuhai-Macao Bridge was opened to traffic, and the applications of 5G, artificial intelligence, block chain and new energy have been accelerated. The construction of innovation centers in Beijing, Shanghai and Guangdong-Hong Kong-Macao Greater Bay Area have been accelerated. A total of 21 national innovation demonstration zones and 169 new- and high-tech development zones have become pioneers for local innovation and development. The GDP of new- and high-tech development zones increased to 12.2 trillion yuan from 8.1 trillion yuan at the start of the period, an increase of more than 50% in five years. The number of new- and high-tech enterprises increased to 225,000from 79,000. After the outbreak of the epidemic, national new- and high-tech development zones and new- and high-tech enterprises have played important roles in resuming production and supporting the economy to remain stable. From January to June, the operational revenue of national new- and high-tech development zones reached 3.9 trillion yuan, with a year-on-year growth of 14.7%; total profit was 351.58 billion yuan, up 17.7% year-on-year; the number of newly registered enterprises reached 223,000, a year-on-year gain of 11.9%. Innovation and entrepreneurship have showed a strong momentum of development.

During the past five years, we have constantly deepened reform of the science and technology system, and further improved the environment for innovation. We have pushed forward the reform of national science and technology management institutions, and completed the top-level design for innovation-driven development. The framework of reforming the management system for science and technology has been basically established, and reforms in the areas of management for science and technology initiatives, application of scientific and technological achievements, sharing of resources, evaluation and reward, and income distribution, have all made substantial progress. We have press ahead with reforms to streamline administration and delegate power, improve regulation, and upgrade services. We have initiated seven actions to reduce the burden of researchers, and made efforts to change their work and study styles. A favorable environment for innovation and entrepreneurship has been created through the advancement of Science and Technology Innovation Board, or STAR Market, the national seed fund for encouraging the application of scientific and technological advances, and maker spaces.

During the past five years, we have cultivated a large number of scientific and technological personnel, and further improved the talent structure. The number of R&D personnel (full-time equivalent)increased from 3.76 million in 2015 to 4.8 million in 2019.An increasing number of leading professionals and innovation teams keep emerging, and young scientific and technological professionals have gradually become the main force in scientific research. We have established a new talent evaluation system oriented towards innovation ability and quality contribution, and are exploring ways to introduce international peer evaluation. We have also promoted a mechanism for optimizing and integrating work permits, talent visas and permanent residence, and carried out trials of all-in-one cards for providing services for high-end foreign talents.

During the past five years, we have become actively involved in the global innovation network, and formed an open and cooperative pattern of S&T research that is all-dimensional, multi-tiered and wide-ranging. We have further strengthened inter-governmental dialogues on innovation cooperation, and continued to implement S&T cooperation and partnership plans. All the key R&D programs are open to institutions in Hong Kong and Macao SARs. We have made steady progress in major international scientific programs and projects, and the Belt and Road Science, Technology and Innovation Cooperation Action Plan has been further implemented.

All these achievements relied on the correct leadership and scientific decision-making of the CPC Central Committee with Comrade Xi Jinping at its core, benefited from strong support of all local governments and departments, and the hard work and selfless dedication of all S&T workers and R&D personnel. I would like to express my highest respect and heartfelt thanks to all researchers and management staff. At the same time, I would also like to thank friends from all sectors of society, including the media, and friends from other countries for your understanding, respect and support to China's scientific and technological innovation.

In the following five years, under the guidance of the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we will further implement the strategy of innovation-driven development, coordinate development and security, adhere to the principle that "scientific and technological development must target the global science frontiers, serve the main economic battlefield, strive to fulfill significant needs of the country and benefit people's lives and health." We will give full play to S&T innovation in fostering a new development architecture and promoting high-quality development, continuously make progress in building China into a country of innovators, and strive for the goal of developing China into a world leader in science and technology.

Next, I would like to answer your questions, thank you.

Hu Kaihong:

Thank you, Mr. Wang. The floor is open for questions. Please state the news outlet you represent first.

Science and Technology Daily:

My questions are about basic research. General Secretary Xi Jinping called for persistence in strengthening basic research at a symposium attended by scientists in Beijing on Sept. 11. My question is, how does the Ministry of Science and Technology strengthen basic research and applied basic research? What important progress has been made in the field of basic research during the 13th Five-Year Plan period (2016-2020)? For instance, what kind of outstanding achievements have been made through the original innovation from "zero to one?" Are there any new measures in this regard? Thanks.

Wang Zhigang:

I will answer these questions. We all know that basic research, applied basic research, technological innovation, innovative uses of technology and industrialization are all involved in scientific research. Among them, basic research can be likened to the source of a waterway and the master switch of scientific research. In addition, the capability of basic research determines the character and sustainable momentum of a country's sci-tech innovation capability. The first-mover advantages always begin with basic research. People's discoveries, their grasping of the rules, and the summary and application of research approaches and patterns are the basis for, key to and even lie at the core of a country's sci-tech innovation capability. During the 13th Five-Year Plan, implementing the decisions made by the CPC Central Committee and the State Council, we perceived the main trends in new sci-tech revolution and industrial transformation, and met them while adapting to changes at home and aboard. Basic research and underpinning technological research and development have been taken as the breakthrough point for sci-tech innovation. We insist on the combination of free inquiry and goal orientation, focus more on original orientation and questions of basic research found in economic and social development and industrial practice, and promote the integration of basic research, applied basic research and technological innovation, so as to bring into full play the underpinning support and guiding role of basic research to sci-tech innovation.

First, we have strengthened the top-level design and systematic layout. Multiple Opinions on Strengthening Basic Scientific Research was issued, and the Work Programme for Strengthening Basic Research from "Zero to One" established and Multiple Measures on Strengthening Basic Research in the New Era implemented. These documents are first to specially strengthen basic research in the history at the national level. They stress basic research from "zero to one", the importance of maths, and also drive the systematic overhaul of the State Natural Sciences Fund. The Work Programme for Strengthening Maths-based Scientific Research has been issued to strengthen basic subject building. Thirteen national applied maths centers have been set up in cities such as Beijing and Shanghai. A batch of basic research projects have been deployed in major areas such as quantum science, stem cell, synthetic biology and nanoscience. Science satellites involving in dark matter and quantum science including Wukong, Mozi and Huiyan have been successfully launched. A group of internationally-significant original achievements have been introduced in major areas such as iron-based superconductor, quantum entanglement and key distribution, heterogeneous fusion brain-inspired chip, chiral molecular synthesis, heterozygous stem cell and graphene controllable folding, as well as a large number of leading talents and innovation teams in basic research cultivated.

Second, the investment in basic research has been sharply increasing through boosting central fiscal support and motivating local enterprises and social programs with government guidance, effective coordination at central and local levels and tax leverage. Investment in basic research increased from 71.6 billion yuan in 2015 to 133.56 billion in 2019, with an average annual growth rate of 16.9%, which is far greater than that of China's total research spending. In 2019, investment in basic research accounted for 6% of the total for the first time.  

Third, we have stepped up the building and sharing of major science and technology infrastructure. We have deployed and built a number of major science and technology infrastructures, including the Five-hundred-meter Aperture Spherical Radio Telescope (FAST) and the China Spallation Neutron Source (CSNS). We have established 20 national scientific data centers, 31 national biological germplasm and experimental material resource banks, and 98 national field scientific observation and research stations to promote the open sharing of scientific research facilities and instruments. More than 4,000 institutes, 101,000 sets of large-scale scientific instruments and 80 major scientific research infrastructures have been incorporated into the open and shared network.

Going forward, we will put basic research and application-oriented basic research higher on the agenda of China's science and technology work. At the same time, we will reform and improve the mechanism for project development. The ability to accurately raise and describe questions is essential to basic research. We will explore ways to create a mechanism for discovering issues which aim for the frontiers of science and technology. We will establish a mechanism for managing and supporting non-consensus projects and disruptive technologies. We will further increase investment in basic research, optimize the investment structure, and strengthen long-term support for unpopular disciplines, basic disciplines and interdisciplinary work. In this way, we aim to offer better services to scientists and researchers dedicated to their work, and to support them in breaking new ground. Thank you.

CCTV:

Many documents and measures have been introduced in recent years to reform the management system for science and technology. What progress has been made? What steps will be taken to further reform and improve the environment for scientific and technological innovation?

Wang Zhigang:

Thank you for your question. As General Secretary Xi Jinping emphasized, to promote the development of science and technology, we should strive for both scientific and technological innovation and institutional innovation. Reform and innovation are closely connected with each other. Reform is targeted at production relations, and innovation at productive forces. Productive forces determine production relations. Production relations should comply with productive forces and can play an active role in their development. We have been implementing a series of important thoughts on scientific and technological innovation set forth by General Secretary Xi since the 18th CPC National Congress held in 2012. We have been coordinating our work on reform and innovation to spur innovation through reform and promoting development through innovation. The Outlines on National Strategy for Innovation Driven Development and an action plan to deepen the reform of the management system for science and technology have been issued, and the latter introduced a total of 143 specific measures. 

We have been adhering to the principle that the scientific and technological development must target the frontiers of global science, serve the economic battlefield, strive to fulfill the significant needs of our country and benefit people's lives and health. With the goal of building a systematic, complete and efficient national innovation system, we have adopted a coordinated and systemized approach to plan and promote the development of science and technology initiatives. Science and technology have become an established force at the center of our national development. 

Focusing on tapping into the enthusiasm and innovative potential among researchers and innovators, we have been working to optimize the allocation of scientific and technological resources, improve the governance system on scientific and technological innovation, and create a favorable climate for innovation, to push for the reform on the management system for science and technology on all fronts. Significant progress has been made in reform in key areas. A complete implementation system integrating laws, policies, measures and action has been established. The potential of science and technology as the primary forces of production has been further unleashed, so has that of innovation as the primary driving force, and talent as the primary resource.

The following is the major progress we have achieved so far. First, to fulfill urgent strategic national needs, we've improved institutions and organizational systems for advancing scientific breakthroughs and emergency-related research. We strived to build up China's strategic capacity in science and technology by building national laboratories for major fields of innovation and restructuring the system of key national laboratories to meet the demand for scientific R&D concerning major national programs. We organized elite scientists and researchers drawn from all over the country to pursue scientific and technological breakthroughs inCOVID-19 prevention and control. We made result-oriented efforts, aimed for appropriate applications, and combined scientific research with clinical treatment. As a result, we achieved a group of practical and effective outcomes in such fields as drug, vaccine and testing, thus contributing to an overall victory in the battle against the virus.

Second, we worked to see that science and technology become more deeply embedded in the economy and promoted the transfer and commercialization of scientific and technological achievements. The Law on Promoting the Application of Scientific and Technological Advances was amended, and quite a few related policies and regulations were introduced. The right to use, transfer and profit from scientific and technological achievements was delegated, and scientific researchers were granted ownership right and the right to long-term use of the scientific and technological achievements made at their posts. Work began to establish a national technology transfer system and demonstration zones for the transfer and commercialization of scientific and technological achievements. In 2019, there were more than 1,000 technology trading markets in China. For the first time, the total value of contracted technology transactions reached 2trillion yuan, 3.5 times that of 2012. New platforms were set up to strengthen financial support for technological innovation. The Shanghai Stock Exchange launched a sci-tech innovation board, with a registration system being piloted for the listing of companies.185 companies have been listed on the sci-tech innovation board, with a total market value of more than 3 trillion yuan. Basically, all those listed companies are high-tech companies.

Third, we stepped up efforts to develop synergy among industries, universities and research institutes, and to energize various kinds of innovators. We encouraged enterprises to undertake major national scientific and technological programs. More than 75% of key national research and development programs now involve the participation of enterprises. We offered incentives for enterprises to increase investment in R&D, such as raising the portion of spending on R&D by enterprises that are eligible for tax deductions from 150% to 175%. Reforms to streamline administration, delegate powers, improve regulation, and upgrade services continued apace. We helped 44 universities and institutes launch a pilot scheme of increasing autonomy in their research activities, which has produced positive effects. A group of market-oriented research institutions with flexible mechanisms has been established. We made strong moves to encourage scientific and technological innovation and entrepreneurship, such as improving maker spaces, incubators and start-up accelerators.

Fourth, we continued to adopt both incentives and constraints in order to create a favorable climate for innovation. We improved a system for category-based management of scientific and technological personnel which complies with the law of their research activities. We don't resort to administrative staff management measures when handling cases in which scientific and technological personnel go abroad, do part-time jobs or start a business after resignation. Profit distribution policies were improved with the goal of strengthening the value ascribed to knowledge. The assessment system for scientific research was reformed and upgraded. Strong measures were rolled out to get rid of the practice of viewing essays, professional titles, educational backgrounds and awards as overwhelming criteria. We implemented seven initiatives to reduce the bureaucratic burden on scientific researchers. We made efforts to address issues of greatest concern to scientific researchers, including too many forms to fill in, onerous reimbursement procedures and too many inspections to undergo. We reformed and improved the academician selection and management system. We urged action to improve conduct and promote a good style of study among the personnel working in the science community. We promoted integrity and improved joint punishment mechanisms. Many cases, including those related to the retraction of multiple articles in Tumor Biology and genetically-edited babies, were severely punished or prosecuted, with relevant information open to the public in a timely manner. We bear zero tolerance toward research misconduct.

Fifth, we deepened the central fiscal management reform for national science and technology initiatives to improve the allocation efficiency of science and technology resources. We integrated nearly 100 science and technology projects originally undertaken by different departments to make resource allocation more centralized and efficient. We finished building an open and unified national science and technology management platform and entrusted the management of research programs to specialized agencies. We reformed project and economic management, streamlined the compilation of budgets, and increased the proportion of indirect costs. We launched a pilot scheme of lump-sum project-funding at the National Natural Science Foundation. Scientific and technological leaders were granted greater autonomy in the utilization of human, financial and property resources to better serve their creativity.

Meanwhile, we should be aware that much remains to be done regarding the reform of the management system for science and technology, and we need to surmount more difficulties in removing deep-rooted institutional barriers. General Secretary Xi stressed that reform is an on-going process with no end point. We will continue to deepen the reform to ensure that relevant decisions and plans are carried out without fail and areas of weakness are improved. We will further optimize the system for scientific and technological innovation and systematically build up China's strategic capacity in science and technology. We will strive to develop a new type of national system for breakthroughs in core technologies under the conditions of the socialist market economy. We will continue to foster favorable policy, legal, social and cultural environments. Through all these efforts, we aim to provide comprehensive institutional guarantees for building China into a global leader in innovation and allow the country to become a science and technology giant. Thank you.

China National Radio (CNR):

To our knowledge, a number of new key scientific and technological programs and projects were introduced under the 13th Five-Year Plan, and they have played a fairly important role in China's social and economic development. Could you elaborate on some of the typical achievements in cutting-edge technologies? And how big of a part do they play in supporting the construction of major national projects, fostering and developing new growth drivers, and promoting high quality development? Thank you.

Qin Yong:

Thank you for your questions, and I will brief you on the situation accordingly. China's socio-economic development has been transitioning to a high-quality stage under the 13th Five-Year Plan, which requires strong support of technologies and innovation. In accordance with the plan deployment, the Ministry of Science and Technology has been focusing on the development of both emerging and cutting-edge technologies and strengthening R&D efforts on sectors. Positive progress has been made to foster and develop new growth drivers, supporting the construction of major national projects, and promote high quality economic development, specifically in the following aspects:

First, a series of emerging and cutting-edge technologies and major advancements in key areas have been introduced, further enhancing our capacity of sci-tech innovation. During the 13th Five-Year Plan, the Ministry of Science and Technology has redoubled its efforts in planning advances the strategic high technologies, and a series of breakthroughs have been made in fields such as supercomputing, rail transit, quantum information, and additive manufacturing. China remains competitive in supercomputing. The number of our supercomputers accounts for 45% of the world's Top 500 rankings. Meanwhile the country is developing an exascale supercomputer after completing the development of a prototype exascale computer. In terms of advanced rail transit, a prototype magnetic levitation train, with a speed of 600 kph, has completed system checks on a test track. A prototype of a high-speed train with a speed of over 400 kph rolled off the assembly line in Changchun city on Oct. 21. All these breakthroughs contribute to the development of a high-speed rail system with a Chinese brand name. In regard to quantum information, with the experiments including the quantum science satellite Mozi and the line between Beijing and Shanghai, the prototype of the first space-ground integrated quantum communication network has taken shape.

Second, new growth drivers have been fostered and developed to support China's high-quality economic development. During the 13th Five-Year Plan, the distribution of emerging and cutting-edge technologies has been highlighted, and progress made in the fields such as new energy vehicle (NEV), telecommunications, third-generation semiconductors and new-type displays. These have effectively guided the development of strategic emerging industries. With more R&D efforts made in NEV's batteries, electric-powered engines and electronics controllers, China has been working to establish a relatively complete industry chain of NEV, which has enabled it to lead the world for five consecutive years in manufacturing and sales of NEVs. The number of NEVs exceeded four million, accounting for over 50% of the world's total. In terms of telecommunication, China has led the world in 5G technology with the largest number of core 5G patents. It also spearheads the commercial use of 5G technologies. There are over 600,000 5G base stations in China, and the number of users has exceeded 110 million. As for new-type displays, by promoting the integration between the innovation value chain and industry chain, China has quickly improved the overall competitiveness of its new-type displays industry. The sales of this sector in 2019 exceeded 300 billion yuan, ranking first in the world.

Third, efforts have been made to bolster the construction of major national projects in order to meet the strategic needs of the country. For the construction of the Hong Kong-Zhuhai-Macao Bridge, significant technological support was provided by systematically arranging key R&D efforts of the cross-sea cluster project. For the construction of the Sichuan-Tibet railway, MOST has provided sci-tech support for the construction's feasibility study, while planning in advance the study on major equipment. The ministry has intensified efforts to solve difficulties in core technology concerning the whole system of hard-rock tunnel boring machines and their core components. All of these efforts will provide self-reliant equipment support to the construction of Sichuan-Tibet railway, known as "a project of the century."

Looking ahead to high-tech development for the 14th Five-Year Plan, MOST will fully implement General Secretary Xi Jinping's guidance that scientific and technological development must target the global science frontiers, serve the main economic battlefield, strive to fulfill significant needs of the country and benefit people's lives and health. In accordance with the strategic requirement of fostering a new, dual-cycle development architecture, and in order to solve the contradiction between the need for high-quality development and the lack of sci-tech innovation capacity, we will make more efforts to develop high technologies. First, the Ministry of Science and Technology will strengthen its efforts in forward-looking deployment work, developing new-generation high technologies featuring intelligent and quantum technologies, so as to foster China's first-mover advantages in the sector. Second, the Ministry of Science and Technology will strengthen R&D efforts in key fields and links, providing more high-tech supplies for high-quality development. Third, it will accelerate its efforts to develop the new-generation high-tech industries, further fostering the new growth drivers. Thank you.

Guangming Daily:

What is the latest development on the technology front in response to the COVID-19pandemic? Please brief us on this issue. Thank you.

Wu Yuanbin:

Thank you for your question. Since the COVID-19pandemic, China's science and technology community has resolutely implemented the decisions and deployments of the CPC Central Committee and the State Council and set up scientific research teams led by the Ministry of Science and Technology, focusing on five major fields including etiology, detection technology and products, clinical treatment and drugs, vaccine research and development, and animal models. In accordance with the "traceable, diagnosable, curable, preventable, and controllable" prevention and control requirement, we brought together the country's top researchers to conduct scientific research, which yielded positive results. We isolated and identified the pathogen and shared the coronavirus genome sequence with the world, laying a foundation for other countries to carry out coronavirus research, diagnostic reagent development, drug screening, and vaccine development. Within 14 days after the release of the coronavirus genome sequence, we completed the research and development of nucleic acid detection reagents and quickly put it into use. In addition, we have continued to improve the performance of nucleic acid detection products. At present, our testing reagents can meet the testing needs of current epidemic prevention and control under different scenarios.

During the epidemic prevention and control period, we quickly screened various drugs and therapies and put into use effective drugs and therapeutics, including chloroquine phosphate, traditional Chinese medicine, convalescent plasma treatment, and stem cell therapy. We have kept improving the diagnosis and treatment plan to increase the cure rate and reduce the mortality rate. In terms of the COVID-19 vaccines, we have been promoting the research and development of safe and effective vaccines in a scientific and orderly manner. At present, 13 Chinese COVID-19 vaccine candidates in five categories have entered the stage of human trials; four of them have started phase-3 clinical trials. China now has the largest number of vaccine candidates that have been approved for clinical trials, leading the world in this field.

During the epidemic prevention and control period, we have also done other fundamental researches, including developing a variety of COVID-19animal models, which provided key technical support for identifying the pathogenesis and transmission pattern and promoting drugs and vaccines development from laboratory tests to human clinical trials. Under the correct leadership of the CPC Central Committee, the Chinese science and technology community has been dedicated to the fight against COVID-19and made these hard-won gains. During the 13th Five-Year Plan period, the Ministry of Science and Technology has placed technological development that is related to people's livelihood in a more important position, formulated special scientific and technological plans, and fostered innovation in the field of life and health. We have invested more in areas such as prevention and control of major diseases, reproductive health, food safety, and environmental improvement, and enhanced the innovation capabilities in these aspects. All achievements we've made can be attributed to the above efforts. Thank you.

China Education Television:

General Secretary Xi Jinping emphasized that great scientific and technological capacity is a must for China to improve its competitiveness on all fronts. What are the major developments of China's technological innovation capabilities during the 13th Five-Year Plan period? In particular, what progress has been made in the cultivation of high-end talents and the construction of innovation platforms and bases? Thank you.

Xu Jing:

Thank you. During the 13th Five-Year Plan period, China's scientific and technological innovation capabilities have achieved historical, holistic and structural development. Quantitative changes lead to a qualitative leap. With one technological breakthrough after another, China has improved its overall technological innovation capabilities. I will illustrate it with the following four aspects.

The scientific and technological talent teams have been optimized. Talents are primary resources. During the13th Five-Year Plan period, China's total full-time equivalent R&D personnel has increased by 1 million. The number of full-time equivalent R&D personnel per 10,000 employees increased from 48.5in 2015 to 62 in 2019. Fully implementing the national plan for cultivating scientific and technological professionals, we have set up high-level innovation talent teams and helped them hone abilities by undertaking major scientific and technological tasks. We have strengthened the training of young professionals and set up projects for scientists under 35 to carry out. The talent structure has been optimized, and a group of top scientific and technological professionals have made their presence felt in the world. According to data from international organizations, China (including Hong Kong and Macao) has seen 735 researchers named the world's Highly Cited Researchers in 2019, an increase of 3.4 times compared to 168 in 2015. The influence of scientific research results in the international community has grown significantly. The number of highly cited papers in 2019 was 30,755, doubling the number in2015, accounting for 20% of the world's highly cited papers and ranking second in the world. Many outstanding scientists have won international awards, such as the Vega Medal in honor of achievements in geography, the Fritz London Memorial Prize in physics, and the Arthur C. Cope Scholar Awards in chemistry.

Second, we have accelerated the construction of innovation bases and platforms, such as national laboratories and state key laboratories. The construction of major scientific infrastructure has been steadily advanced, providing a good foundation for scientific research.

Thirdly, the status of enterprises as the mainstay of innovation has been strengthened. Enterprises are the most critical players in China's technological innovation. In 2019, 507 Chinese companies were put on the shortlist for Research and Development Investment of Top 2500 Companies Around the World. These 507 companies' business scopes are mainly in modern high-tech fields, such as drones, e-commerce, cloud computing, artificial intelligence, and mobile communications. The number of high-tech companies reached 225,000 in 2019, an increase of 1.8 times from2015. The innovation capability of enterprises continues to increase. China's PCT patent applications had increased from 30,000 in 2015 to 59,000 in 2019, ranking first in the world. The combination of technology and finance facilitates the development of enterprises. In the past five years, technology and finance have developed rapidly, and the multi-level capital market has provided powerful external resources for the application of scientific and technological innovation achievements. For listed companies just mentioned, as of Oct. 14, 183 Chinese science and technology enterprises had been listed on the science and technology innovation board, of which 173 are high-tech enterprises. The capital market and science and technology enterprises have supported each other, creating a virtuous circle.

Finally, we work to accelerate the formation of regional innovation clusters. In the past five years, rapid development has been achieved in the construction of science and technology innovation centers in Beijing, Shanghai, and Guangdong-Hong Kong-Macao Greater Bay Area (GBA). Also, the construction of the Chengdu-Chongqing Science and Technology Innovation Center began recently. According to an assessment of the World Intellectual Property Organization, 17 regions of China have entered the top 100 global innovation clusters list. Among them, the GBA, Beijing, and Shanghai made the top 10. These achievements demonstrate that China's overall technological innovation capabilities have been improved during the 13th Five-Year Plan period. Thank you.

CNS:

We all know that one of China's two centenary goals is to build a moderately prosperous society in all respects by 2020.Science and technology is a primary source of productivity growth. What role has the primary source played in realizing the centenary goal, especially in the fight against poverty in impoverished areas? How can we further leverage the role of science and technology in consolidating the progress in poverty alleviation and realizing the rural revitalization? Thank you.

He Defang：

Thank you for your questions. You are quite right. Since the 18th National Congress of the CPC, the leading Party members' group at the Ministry of Science and Technology has adhered to the important statements of General Secretary Xi Jinping on poverty alleviation work as the basic principle, fully implemented the decisions and arrangements of the CPC Central Committee on poverty alleviation, and adhered to the strategy of targeted poverty alleviation. The group has also organized and mobilized the scientific and technological forces of the entire society, and carried out the "hundred, thousand and ten thousand "scientific and technological project of poverty alleviation, achieving solid progress. I would like to answer your question from two aspects: systematic promotion by the scientific and technological industry and the comprehensive efforts in targeted poverty alleviation.

The scientific and technological industry has systematically promoted the work in poverty alleviation. First, we have focused on the technological bottlenecks appearing in the agricultural sector and empowered the capacity of poverty alleviation programs in a targeted manner. Over the past five years, 37,600 science and technology-related advances have been achieved, and more than 50,000 new varieties and technologies have been popularized, improving industrial quality and efficiency in poor areas. Second, targeting the weak link represented by a lack of sci-tech talents in poor areas, we have selected and dispatched appropriate staff to these regions. Sci-tech personnel of various levels and types have been organized to provide intellectual support for the development in impoverished areas. Technicians providing sci-tech services to ensure full coverage of entrepreneurship-driven development in villages registered as living under the poverty line has been basically achieved. Third, we have focused on the weak link that is a lack of sci-tech resources in impoverished areas and integrated innovation resources in a precise way. China has given preferential support in poor areas to construct national and provincial-level agricultural sci-tech parks and innovation platforms such as maker spaces. The parks and platforms, totaling 1,152 according to preliminary statistics, have promoted the flow of sci-tech elements to needy areas.

Second, comprehensive and redoubled efforts have been made to fight against poverty in designated poverty-stricken counties. I checked the data and found the Ministry of Science and Technology actually started its pairing assistance work in 1989. So far, a total of 30 groups have been sent out. Since the Central Conference on Poverty Alleviation, the sci-tech industry management system has formed a "four-level synergy" mechanism. By attracting and cultivating talents, transforming technological advances and supporting relevant industries, the five designated impoverished counties of Jinggangshan, Yongxin, Pingshan, Zhashui and Jiaxian have all been lifted out of poverty, with Jinggangshan the first to do so in 2017. Since 2016, we have invested 220 million yuan and introduced over 1 billion yuan to pair with and assist the five counties. The vegetables in Jinggangshan, silkworms in Yongxin, tea leaves in Pingshan, edible fungus in Zhashui, coarse cereals in Jiaxian and other poverty alleviation industries with distinctive features have taken shape, fully showing sci-tech elements are indispensable in poverty alleviation and verifying the precision, sustainability and effectiveness of science and technology-based anti-poverty efforts. I am still the head of the 30thpoverty alleviation group sent by the Ministry of Science and Technology to Shaanxi, and I want to share a couple of short stories.

First, in recent years, MOST has helped build Zhashui in Shaanxi province into an innovative county and establish three innovation platforms there, including a big data center of edible fungus and an academician workstation. This has driven growth of 30 demonstration bases and realized an annual output value of nearly 300 million yuan in the edible fungus industry. General Secretary XiJinping commended the edible fungus in Zhashui by noting "small fungus, big industry". Second, we promoted the "hill-drop sowing technology in dry land with permeable mulching film" across Jiaxian county in Shaanxi in 2017.Not long ago, with the approval of Mr. Wang, I went to Jiaxian on an inspection trip, where I witnessed how technological help had secured stable production and income increase despite this year's drought in northern Shaanxi. This stable production was hard-earned. The selling price registered a great increase. However, the situation of the control group was quite different.

In the next step, the Ministry of Science and Technology will further implement the decisions and arrangements of the CPC Central Committee and the State Council on poverty alleviation, leverage the sci-tech advantages, and support and consolidate the progress in fight against poverty. We will continue to promote the organic link-up between poverty alleviation and rural revitalization, and to drive rural revitalization and development through innovation. Thank you.

Wang Zhigang:

I would like to add some information to the poverty alleviation work by MOST. First, as stated, it began in 1989 and Jinggangshan is the first county to shake off poverty. The science and technology-based poverty alleviation stresses helping people increase confidence in their own ability to lift themselves out of poverty and ensuring they can access the education they need to do so. Confidence is closely related with better education. When people acquire more knowledge and skills, have their own perceptions towards a problem and deal with it in their own way, they will become more ambitious and confident. In this sense, we improve people's knowledge and skills through science and technology to boost their confidence to make their own way out of poverty. In this way, they are also more likely to help others to get rid of poverty.

Second, in recent years, MOST has also organized and mobilized innovative resources in the more developed eastern regions to pair with and assist the less developed areas in the central and western regions in a targeted way. Activities of supporting the development of Ningxia Hui Autonomous Region, Inner Mongolia Autonomous Region and Yunnan province through science and technology have been carried out. Science and technology should not only make breakthroughs on the frontiers, but also should be comprehensively upgraded to support and serve national development and security as well as improvement of people's livelihood. Thank you.

Hong Kong Economic Herald:

My question is to Mr. Wang. What achievements have been made in supporting the Greater Bay Area with science and technology, please? What are the next steps in the regard? And what thoughts and considerations do you have in scientific and technological innovation for the 14th Five-Year Plan? Thank you.

Wang Zhigang:

The development of the Guangdong-Hong Kong-Macao Greater Bay Area is a major regional strategy of China. To measure its success, sci-tech development and diffusion as well as its contribution to the area's socio-economic advances, environmental and livelihood improvement are sure to be among the most important criteria. Thus, a very important plan for the area's progress is that of sci-tech innovation. In forming the plan, the combination of sci-tech strength of not only Guangdong, Hong Kong and Macao but also the rest of the country, is crucial to the overall development of the area, ranging from technology, science and research to industries and people's overall improvement. At the same time, a good environment for innovation should be fostered. Widespread, high-quality development of a region largely depends on the high-quality personnel, enterprises, research institutions and universities within it. Therefore, the Greater Bay Area should adopt people-oriented planning, provide a preferential environment for sci-tech research, and build a platform where people can integrate their personal improvement and fulfillment into the national development goal. This is a significant idea in devising the sci-tech innovation scheme for the Greater Bay Area.

We are now cooperating with Hong Kong, Macao, Shenzhen city and Guangdong province as well as sci-tech circles, industrial sectors and local governments to ensure top-level planning for sci-tech innovation. Concrete measures will be adopted to work out a proper scheme, formulate appropriate policies and laws, as well as cultivate a good cultural and social environment. Actions will be further taken to form a platform where sci-tech personnel can gather and build sci-tech infrastructure that can prop up local development. Your attention to these will be welcomed. Again, for the development of the Greater Bay Area, science and technology is one of the decisive factors. In a sense, the sci-tech success can determine the development of the Greater Bay Area. Thank you.

CGTN:

The world has undergone considerable changes which have affected the fields of science and technology. During the 13th Five-Year Plan period, what progress has China made in international scientific and technological cooperation? At the same time, under the current situation, what arrangements have China made in terms of international cooperation? Thank you.

Wang Zhigang:

Thank you for your question. The international situation has indeed affected us. Science and technology play an important role in both international competition and cooperation. The field of technology has become a key battleground, and we must rise to the challenge. Many Chinese companies, and especially high-tech companies and personnel, have been excluded and suppressed by some forces around the world. However, I think that science is in some sense a universal language and has its own objective laws. Therefore, international cooperation is necessary for the development of science and technology and we need to build a scientific community according to developmental laws. In addition, scientific research cannot be conducted behind closed doors. There is a Chinese saying:"When I walk along with two others, they may serve me as my teachers."With this viewpoint in mind, China has always been adhering to the correct path of cooperation in the reform and opening-up process where science and technology take center stage. We also recognize that over the past 40 years of reform and opening-up, including during the 13th Five-Year Plan period, China has not only participated in and benefited from scientific and technological opening-up and cooperation, but also contributed to global technological progress and human development. It is a reciprocal process. During the 13th Five-Year Plan period, we have continued to advance innovation with a global perspective and actively integrated into the global innovation network. We have promoted scientific and technological exchanges and cooperation in fields including basic research and global issues between scientists in China and from around the world, and jointly increased public knowledge and the collective wisdom of human society.

First, a comprehensive and multi-layer cooperation framework covering a wide range of areas has been formed. Bilateral and multilateral inter-governmental exchanges and cooperation in scientific and technological fields have been strengthened. We have established innovative dialogue mechanisms with multiple countries, and extensively participated in and promoted consultations and practical cooperation on issues of sci-tech innovation under multilateral mechanisms. At present, China has established such cooperation relations with 161 countries and regions, and signed 114 inter-governmental scientific and technological cooperation agreements, which are all part of various mechanisms. China has also participated in more than 200 international organizations as well as multilateral mechanisms related to science and technology.

Second, the Ministry of Science and Technology has actively participated and taken the lead in organizing and undertaking international big science research plans and projects. It has also actively undertaken tasks and fully participated in the operational management of major international scientific programs and projects such as the International Thermonuclear Experimental Reactor (ITER) project, Square Kilometer Array (SKA) radio telescope, and International Ocean Discovery Program (IODP). The Ministry of Science and Technology has been solving major technological and engineering difficulties in a proactive manner, and is playing an increasingly important role accordingly. It focuses on major issues concerning sustainable global development, is accelerating efforts to launch international big science research plans and projects which are led by China, and supports scientists of all countries to jointly conduct research. The role China plays in this regard has changed from an increased level of participation to taking the initiative.

Third, the Ministry of Science and Technology has fully implemented the Belt and Road Science, Technology and Innovation Cooperation Action Plan. General Secretary Xi Jinping proposed this action plan during the first and second Belt and Road Forum for International Cooperation (BRF). The plan consists of four aspects: the Science and Technology People-to-People Exchange Initiative, the Joint Laboratory Initiative, the Science Park Cooperation Initiative, and the Technology Transfer Initiative. We have supported over 8,300 young scientists from around the world to work in China, trained 180,000 personnel, and started construction on 33 joint laboratories with countries participating in the Belt and Road Initiative. We have also established official cooperation relations on science parks with eight countries, built five national tech transfer platforms, and launched a Sino-African sci-tech innovation cooperation center. A technology transferring South-South cooperation center has also been established under the UN's South-South cooperation mechanism, and the Belt and Road tech transfer network has been basically established.

We are delighted to see that more and more Chinese science and technology professionals are participating in international sci-tech undertakings, and are contributing Chinese wisdom to addressing major global issues. For example, amid the pandemic prevention and control work, China has earnestly fulfilled its international obligations by actively promoting the sharing of scientific data and information. China has established a scientific literature sharing platform which is open to the world. The platform has provided services for users in 175 countries and regions, with total downloads of data exceeding 160 million times. The platform has helped China share its anti-epidemic experience with the rest of the world, strengthened global R&D efforts and cooperation in vaccine, medicine and COVID-19 testing, and thus contributed to the global anti-pandemic efforts. China also takes the lead in animal models as we mentioned earlier. Not long ago, China officially joined the COVAX initiative, the COVID-19 vaccination plan co-led by the Global Alliance for Vaccines and Immunization, the Coalition for Epidemic Preparedness Innovations (CEPI), and the World Health Organization (WHO). China will resolutely honor its solemn commitment to provide vaccines and other public goods for the world.

Looking ahead, China's resolve to promote the opening-up and cooperation on sci-tech is even stronger. Our determination in this regard is persistent. As I said at the beginning, science and technology requires international cooperation. China will take even bigger steps to promote international cooperation and communication in this regard at both government-to-government level and people-to-people level. China will work to make the BRIa path to innovation, joining hands with the rest of world to address major public health challenges such as COVID-19. China will open its doors even wider to the world regarding its science and technology plans, and provide greater convenience for overseas talents who work and open businesses in China. Through opening-up and cooperation, China will realize mutual benefit, understanding, respect and trust with the rest of the world. China will take on the responsibility of sci-tech innovation to build a community with a shared future for mankind.

China Daily:

The general public pays great attention to issues, such as scientific research ecology and integrity. In recent years, China has issued a series of rules and regulations. What problems do we currently have in terms of building work style and study style in the science and technology community? What can be further improved? Thank you.

He Defang:

Thanks for your questions. I want to make a point before answering your questions. Excellent scientific research work style and study style are the "lifeline" for performing well in science and technology works. General Secretary Xi Jinping has repeatedly emphasized the need to vigorously promote the spirit of scientists and strengthen the construction of scientific research work style and study style. The Ministry of Science and Technology should effectively improve its political position and make the construction of work style and study style a priority. Mr. Wang also introduced these in his statement just now. The Ministry of Science and Technology, in conjunction with relevant departments, will take various measures to advance the implementation.

For publicity and guidance, the "Spirit of Scientists" book series was compiled and published, and a column was set up to vigorously promote not only the spirit of scientists but also the spiritual outlook and innovative deeds of those outstanding scientists. Especially during the COVID-19 pandemic, the Ministry of Science and Technology and other departments issued the "Five Advocacies, "advocating science and technology to serve the country, advocating rigorous truth-seeking, advocating devoted research, advocating rational questioning, and advocating academic democracy. These advocacies actively guide scientific and technological workers to write papers for their motherland and apply the results to the fight against the pandemic. The response is positive.

In terms of environmental construction, the Ministry of Science and Technology has implemented a dual approach. On the one hand, it established an incentive mechanism based on trust. It has continuously deepened reforms on project review, talent evaluation, and institutional evaluation. In conjunction with relevant departments, it also formulated a series of documents for "breaking the four standards," which means China will not just evaluate talents based on thesis, professional titles, education levels, or awards and will carry out seven special actions to reduce the burden on the grassroots and stimulate innovation vitality. On the other hand, it insists that trust is not laissez-faire, and tolerance is not indulgence. Strengthening supervision and restraint is for building better trust and tolerance. We have issued rules for investigating and handling scientific research integrity cases, as well as regulations for handling violations in scientific and technological work, so as to draw red lines, define boundaries, unify standards, and strengthen supervision.

In terms of serious punishment, our attitude towards scientific research violations, such as paper falsification, has always been clear and resolute. That is, once discovered, the case will be dealt with, and we will never tolerate it. On Sept. 16, several scientific and technological violations were publicly revealed. Mr. Wang just introduced the handling of 107 problematic papers on tumor biology, which will shape a regular notification system in the future. Rule-abiding people should be protected, while violators should be restricted everywhere.

Since the 13th Five-Year Plan, various measures for the governance of scientific research work and study styles have been effectively implemented, and some deep-seated problems have gradually been resolved. However, we should also see that the phenomena of exaggeration, quick success, academic misconduct, and even fraud are still happening from time to time, and the task of dealing with work and study styles is still very arduous. In the next step, the Ministry of Science and Technology will work with relevant departments to further transform government functions and shift more energy to making strategies, policies, and guidelines, as well as creating environments and improving service. For some innovative entities, such as universities and scientific research institutions, we must earnestly shoulder the main responsibilities, strengthen education and guidance, enhance academic management, and expose and deal with bad work and study styles and violations. The vast number of scientific researchers must inherit fine traditions, abide by scientific research norms, and cherish academic reputation. The ministry will work with all sectors of society and scientific researchers to form a strong joint force, guard the "lifeline" of scientific and technological work, and promote the construction of China's scientific research style to achieve greater results.

Hu Kaihong:

Does Mr. Wang have anything to add?

Wang Zhigang:

Finally, I would like to express my gratitude to friends in the media, and thank you for your time and questions. Thank you all.

Hu Kaihong:

This concludes today's press conference. Thank you, Mr. Wang. Thank you to our four speakers, and thank you all.

.

Read in Chinese

Speaker:

Zhao Yingmin, vice minister of ecology and environment

Chairperson:

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office

Date:

Oct. 21, 2020

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to the press conference of the State Council Information Office (SCIO). The year 2020 is the final year of the 13th Five-Year Plan. In the following days, the SCIO will hold a series of press conferences to introduce the country's economic and social development over this period.

Today, I am very pleased to invite Mr. Zhao Yingmin, vice minister of ecology and environment, to brief you about issues regarding environmental protection in the 13th Five-Year Plan period and take your questions. First of all, I invite Mr. Zhao to make an opening statement.

Zhao Yingmin:

Thank you. Ladies and gentlemen, friends from the media, good morning! I am very pleased to have the opportunity to brief you about issues related to environment protection during the 13th Five-Year Plan period. First of all, on behalf of the Ministry of Ecology and Environment, I would like to thank you for your concern, support, participation, and guidance in regard to ecological and environmental protection.

Since the 18th National Congress of the Communist Party of China (CPC), under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, historic, transitional and overall changes have taken place in terms of ecological and environmental protection. The government has made greater efforts in this area than ever before. General Secretary Xi Jinping has pointed out on many occasions that China should uphold the concept that lucid waters and lush mountains are invaluable assets, adopt a holistic approach to conserving our mountains, rivers, forests, farmland, lakes, and grasslands, and improve the development of our geographical space so as to enhance ecological conservation and environmental protection.

The 13th Five-Year Plan period now drawing to a close marks the completion of the drive to build a moderately prosperous society in all respects and also in launching and gradually winning the critical battle of pollution prevention and control. In the past five years, we have regarded this as our main task. Major headway has been made in combating pollution and various ecological and environmental protection tasks, and the main objectives and tasks put forward in the outline have been basically accomplished. In the period, we have seen the greatest improvement in the quality of the national ecological environment and the best development of the cause of environmental protection so far. People's sense of gain, happiness and security in regard to their ecological environment has been continuously enhanced.

Compared to five years ago, the overall quality of the ecological environment in China has improved, and the phased goals of pollution prevention and control successfully achieved. As of the end of 2019, eight binding targets set in the 13th Five-Year-Plan for the protection of ecological environment have been completed ahead of schedule, including the desired percentage reduction of PM2.5 concentration in substandard cities at or above prefecture-level, the percentage of surface water with quality at or better than Grade III, reduction in the percentage of surface water with quality worse than Grade V; in addition, the carbon dioxide emission intensity per unit of GDP has been lowered, and there has been significant reduction of major pollutants discharge including chemical oxygen demand (COD), ammonia nitrogen, sulfur dioxide (SO2), and nitrogen oxides (NOx). From January to September this year, further progress has been achieved in terms of eight targets: the number of days with good air quality in cities at prefecture-level and above reached 87.2%, and it is expected that the binding target of 84.5% will be achieved by the end of this year. By the end of this year, the nine binding targets set for protection of the ecological environment established in the 13th Five-Year Plan outline will be fully completed.

At the same time, progress has been made in protection of the ecological environment on all fronts. Reforms to establish a sound ecological environment have gone smoothly. Laws, regulations, standards and policy systems have been continuously improved. Law enforcement in regard to the ecological environment has been continuously increased. Smooth progress has been made in major ecological conservation and restoration projects. Our ability to prevent and manage ecological environmental risks has been continuously improved. We have accelerated improvements in the ecological environment governance system and modernization of governance capacity. With these efforts and progress, we have laid a solid foundation for building of a moderately prosperous society in all respects.

In the next step, following the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly putting into practice Xi Jinping's thinking on promoting ecological progress and the new development philosophy, and fulfilling the requirement for high-quality development, we will place greater importance on ecological restoration and environmental protection. While continuing to advance regular epidemic control, we will also promote economic and social development and ecological environmental protection. We will ensure stability on the six fronts (employment, the financial sector, foreign trade, foreign investment, domestic investment, and expectations) and security in the six areas (job security, basic living needs, operations of market entities, food and energy, stable industrial and supply chains, and the normal functioning of primary-level governments) and accomplish ecological and environmental protection tasks proposed in the 13th Five-Year Plan. At the same time, we will make overall plans of the 14th Five-Year Plan for protecting the ecological environment and scientifically identify the main objectives and tasks. With unremitting efforts, we will adhere to the same working direction and go deeper and further to continue to tackle pollution and promote ecological protection to a new level, establishing a good start for the 14th Five-Year Plan.

I would now like to answer your questions.

Shou Xiaoli:

Thank you, Mr. Zhao, for your introduction. Now, the floor is open for questions. Please identify your news outlet before you raise the question. Let's begin.

China Daily:

During the general debate of the 75th session of the United Nations General Assembly, General Secretary Xi Jinping announced China aims to have CO2 emissions peak before 2030 and achieve carbon neutrality before 2060. What efforts has China made to address climate change during the 13th Five-Year Plan period? What progress has been made? What's the plan from now to implement General Secretary Xi Jinping's requirements on achieving the carbon emission target? In addition, how is the preparatory work proceeding for the 15th Conference of the Parties (COP15) to the Convention on Biological Diversity? What expectations does China have for the event? Thank you.

Zhao Yingmin:

General Secretary Xi Jinping put forward China's new target and vision for carbon emission at the general debate of the 75th session of the U.N. General Assembly, drawing wide attention and winning extensive praise internationally. China has implemented proactive national strategies on climate change, and adopted a series of measures such as adjustments in the structure of industry, improving the energy mix, energy conservation and improvements in efficiency, developing a carbon trading market, and enhancing forest carbon sinks. China has made remarkable progress in addressing the challenges of climate change during the 13th Five-Year Plan period.

First, it has efficiently mitigated greenhouse gas emissions. The carbon dioxide emissions per unit of GDP continue to decline, and the country has basically stopped the rapid increase in overall carbon dioxide emissions. By the end of 2019, we cut the intensity of carbon emission by 18.2% compared with 2015, meeting the binding objective set in the 13th Five-Year Plan ahead of schedule. The intensity of carbon emission is 48.1% lower than in 2005, and the share of non-fossil fuels in energy consumption has now reached 15.3%. These have met ahead of time the 2020 goals China promised to the world.

Second, China has made steady progress in energy conservation in key sectors. In 2019, the energy consumption per unit of added value of industry amongst enterprises above designated size declined by over 15% from 2015, the energy saved being equivalent to 480 million tons of standard coal. About 400 billion yuan was saved in energy cost. Green buildings account for 60% of newly-built civil buildings in urban areas. By renovating existing urban buildings with energy-saving facilities, we managed to improve building energy efficiency and optimize the living environment, bringing benefits to over 21 million households. Since 2010, China's new energy vehicle (NEV) industry has seen rapid growth, and its sales of NEVs account for 55% of the total amount globally. Currently, China also tops the world in terms of NEVs it holds.

Third, renewable energy has achieved rapid development. Since the beginning of the 13th Five-Year Plan period, installed capacity of renewable energy has been growing 12% annually on average, with its newly installed capacity exceeding 50% of the yearly total. Renewable energy has also seen steady increase in its share in China's total installed capacity, and has become an important factor in the country's energy transition and the main contributor to meeting future power needs. New energy represented by wind power and solar energy is growing rapidly, becoming key sources of renewable energy. As of 2019, installed capacity of new energy accounted for 55.2% of the total installed capacity of renewable energy. Hydropower and pumped-storage hydropower have both achieved steady development. By the end of last year, the installed capacity of hydropower accounted for 44.8% of the national installed capacity of renewable energy.

Fourth, China has made steady progress in proactively adapting to climate change. We have strengthened efforts in providing guidance to related sectors, carrying out trials in 28 cities to develop their climate resilience, as well as in 81 cities from six provinces to encourage low-carbon growth. The government has placed great emphasis on coordination between the adaptation to climate change and the conservation of ecology and environment. We have completed nationwide institutional reform and functional adjustment regarding adapting to climate change.

Fifth, China has actively participated in global climate governance. We adhere to multilateralism and contributed to the conclusion of a package of implementing guidelines for the Paris Agreement. China has been working with other countries to implement the Belt and Road South-South Cooperation Initiative on Climate Change. We help other developing countries to build their capacity in adapting to climate change. The announcement made by General Secretary Xi Jinping on Sept. 22 demonstrates China's strategic focus on resolutely adopting a green and low carbon approach. It also shows that China, as a responsible major country, will resolutely adhere to multilateralism and actively work to promote the building of a community with a shared future for humanity. This is greatly boosting confidence in the international community to jointly implement the Paris Agreement and promote green recovery of the world economy in the post-pandemic era. This also represents China's new efforts and contributions to adapting to global climate change, and provides significant political and market growth drivers for promoting sustainable and resilient economic recovery after the pandemic.

Looking ahead, we will continue to strategically focus on ecological conservation, working to deliver China's new Intended Nationally Determined Contributions (INDCs) and goal of carbon neutrality with greater determination and efforts. First, China will resolutely implement proactive national strategies on climate change, comprehensively strengthen efforts to adapt to climate change and work to establish an economic structure that facilitates green, low-carbon, and circular development. Second, China will take effective measures to control the consumption of fossil fuels. Greater efforts will be made to develop non-fossil fuels and carry out green and low-carbon campaigns in key sectors. China will accelerate its efforts to promote a green and low-carbon way of production and life, carry out campaigns for carbon dioxide emissions to peak and then decline, and establish a national market for trading carbon emission rights. China will promote green and low-carbon technological innovation, and effectively improve its climate governance capacity, so as to make greater contributions to the global efforts in addressing climate change.

In regard to the COP15 to the Convention on Biological Diversity that you mentioned, relevant preparations are proceeding, and we are negotiating with the countries involved. The preparatory work is making smooth headway. That's all. Thank you.

China Media Group:

Mr. Zhao, just now you said that the 13th Five-Year Plan period (2016-2020) saw the greatest and most effective environmental improvements. What are the specific achievements? What problems does China still have in matters of ecological environment protection during this period? What better arrangements can be worked out for the 14th Five-Year Plan period (2021-2025)? Thank you.

Zhao Yingmin:

Thank you for your question. This is a very general question. I will give you a brief introduction.

During the 13th Five-Year Plan period, all localities and departments have fully implemented the decisions and arrangements made by the CPC Central Committee and the State Council. We can say that great progress has been made in all aspects of ecological environment protection. The environmental improvement has really benefitted the Chinese people. Critical advances have also been made in other key areas of ecological protection, giving our people a far stronger sense of gain, security and happiness. The accomplishments during the 13th Five-Year Plan period can be summed up in several aspects.

First, strategic arrangements have been strengthened, and the whole society is more aware of the importance of ecological environment protection. Building an ecological civilization is vital to sustain the Chinese nation's development. The statement that "we should fully understand that lucid waters and lush mountains are invaluable assets" was added to the Party Constitution, and the term "ecological civilization" was written into the Constitution. More and more localities are promoting ecological progress as an opportunity and a key driver, striving to set themselves on a path that will achieve both economic development and environmental protection. Enterprises have taken measures to prevent and control pollution and discharge pollutants in accordance with the law. Their awareness of environmental protection laws and their leading role in environmental protection are being fostered at a faster pace. The whole society is more conscious of protecting the environment and is participating in and contributing to environmental conservation.

Second, the battle against pollution has progressed smoothly, and efforts to improve the environment have been intensified. Action plans for the prevention and control of air, water and soil pollution have been fully implemented. The CPC Central Committee and the State Council have published a guideline to comprehensively enhance ecological environment protection and win the battle against pollution of air, water and soil. A three-year action plan has been issued to win the battle for blue skies, together with other targeted action plans. The seven landmark battles (the battles for blue skies, diesel truck pollution treatment, water source protection, black and malodorous water bodies treatment, the Yangtze River conservation and restoration, comprehensive treatment of pollution in the Bohai Sea, as well as pollution treatment in agriculture and rural areas) have gone smoothly. The ecological environment has been continuously improved, giving a strong boost to high-quality development. Just now, I have given a briefing on the improvement of environmental quality during the 13th Five-Year Plan period. 

Third, the continuous enhancement of ecological environment protection has given a strong push to high-quality economic development. Energy conservation has been strengthened to increase energy efficiency. Major adjustments have been made to the energy mix to promote green and low-carbon development. As of 2019 during the 13th Five-Year Plan period, the carbon dioxide emissions per unit of GDP had dropped by a cumulative 18.2%; the installed capacity of the coal-fired power generators with ultra-low emissions nationwide had reached 890 million kilowatts, accounting for 86% of the total; the world's largest clean coal power supply system with ultra-low emissions had been established; our installed capacity and power generation of photovoltaic and wind power leads the world; clean energy had made up 23.4% of the country's total energy consumption; the coal ports in the Beijing-Tianjin-Hebei region had shifted their transportation channels from highways to railways; the railway cargo volume nationwide had increased by 7.2% year-on-year. We have strengthened the ecological red lines, environmental quality bottom lines, resources utilization ceilings, and the strict constraints of the negative list of ecological environmental standards for market access to improve the industrial layout and structure. By vigorously rectifying small, poorly-managed and heavily-polluting enterprises, the problem of the bad driving out the good in the market has been solved, creating a more level playing field for law-abiding enterprises. By gradually tightening pollutant discharge standards, industrial technology has been upgraded and the green development of enterprises has been promoted.

Fourth, a top-level planning system for ecological advancement has been established, which has promoted the fostering of a "general environment" for ecological protection. The systems, including the central inspection system for ecological and environmental protection, have delivered real results. The mechanism, by which both the CPC committees and governments are held accountable for environmental issues and that officials take responsibility for environmental protection in performing their duties, has been greatly strengthened. A number of systems, including pollution discharge permit, comprehensive administrative law enforcement for ecological environment protection, as well as compensation and accountability for ecological environment damages, have been formed. The reforms of examining and assessing ecological progress, river and lake chief systems and the vertical management of environmental monitoring, inspection and law enforcement functions in ecological and environmental departments below the provincial level have been accelerated.

Fifth, China plays an active role in global environmental governance, providing our wisdom, concepts and solutions to the world. China was one of the first countries to release a National Plan on Implementation of the 2030 Agenda for Sustainable Development. We have deposited the instrument of ratification of the Paris Agreement with the United Nations and made contributions to the adoption of the agreement's implementation guidelines. We have reached the 2020 carbon dioxide emissions target ahead of time, and announced that we will scale up our nationally determined contributions, strive to reach peak carbon emissions before 2030, and achieve carbon neutrality by 2060. China was among the first to sign and authorize the Convention on Biological Diversity. We actively prepared and organized the 15th meeting of the Conference of the Parties to the Convention on Biological Diversity, and jointly carried out the International Coalition for Green Development on the Belt and Road. The total amount of ozone-depleting substances eliminated by China accounts for over 50% of the total amount eliminated by developing countries. Hence, we are the country with the largest contribution to protecting the global ozone layer. Furthermore, during the 13th Five-Year Plan period, many projects, including the Saihanba Afforestation Community, the Zhejiang Green Rural Revival Program and Alipay Ant Forest, have been awarded the UN's Champions of the Earth award. 

As we have seen improvements to ecological environment and realized achievements of the 13th Five-Year Plan, we can clearly notice that there is still a gap between the current ecological environment and people's expectations. There is also a gap between the current status and the requirements for building a beautiful China. The domestic ecological environment still faces severe challenges. The pressures of ecological environment protection from many aspects, including structures, origins and trends, have been generally at a high level. The most prominent ones are the "three unchanged aspects." First, no fundamental changes have been made to industrial structures dominated by heavy chemicals, energy consumption which is reliant on coal, and transportation which is dominated by roads. Second, there were no fundamental changes in the serious conditions of environmental pollution and ecological environment protection. Third, the high-risk status and high frequency of ecological environmental incidents also remains fundamentally unchanged. The current international situation is undergoing complex and profound changes, risks and challenges have been gradually increasing, and unilateralism and protectionism are on the rise. Therefore, the work to protect the environment still has a long way to go.

Next, we will designate accomplishing the 13th Five-Year Plan as an important task, especially in terms of completing pollution control and prevention work. We will summarize the successful experiences and methods of preventing and controlling pollution. According to the goals outlined during the 19th National Congress of the Communist Party of China (CPC) to "achieve a fundamental improvement in the ecological environment and basically attain the goal of building a beautiful China by 2035," we should adhere to the orientation of green development and promote the green development transformation. This is also in line with the spirit of the upcoming Fifth Plenary Session of the 19th CPC Central Committee and the requirements of the 14th Five-Year Plan which will be reviewed by the National People's Congress. We should maintain a high-level of ecological environmental protection while promoting high-quality socioeconomic development. We should enhance the endogenous driving force for improving the quality of the ecological environment and adhere to the orientation of the goals and the results. With improving the quality of the ecological environment as the core, we must put equal emphasis on ecological protection and environmental governance, and we also need to coordinate efforts to control air pollution and respond to climate change. In terms of environmental protection, we will strengthen reform, innovation and basic capabilities, and set scientific goals, targets and key tasks in the 14th Five-Year Plan. We will do our best to accomplish the work next year and make a good start toward achieving the second centenary goal. Thank you.

Voice of Economy, China National Radio:

During the 13th Five-Year Plan period, China has made notable improvements to the environment. As a result, our people now enjoy more blue skies and white clouds. Could you please elaborate on the achievements made by our country in addressing air pollution during the 13th Five-Year Plan period? Thank you.

Zhao Yingmin:

Thank you for your question. Air pollution prevention and control has always been a big concern of society. It is also a priority in the tough battle against pollution, which is receiving the close attention of the CPC Central Committee and the State Council. Meanwhile, air quality improvement has been one of the most effective and successful parts of our campaigns in pollution prevention and control.

During the 13th Five-Year Plan period, the Ministry of Ecology and Environment (MEE) has worked together with relevant departments all over the country to fully implement the CPC Central Committee's decision and plan on the fight to keep our skies blue; it has taken decisive steps to ensure the achievement of our objectives. As a result, the air quality throughout the country has been notably improved. Major achievements were made in five aspects:

First, the eco-friendly transformation and upgrading of industrial structures have had substantive results. We cut about 200 million tons of overcapacity in the steel industry and eliminated 140 million tons of substandard steel capacity. By the end of 2019, the capacity of coal-burning power plants that had completed upgrades to achieve ultra-low emissions reached 890 gigawatts. Currently, about 610 million tons of crude steel capacity has been upgraded nationwide to achieve ultra-low emissions. After upgrading the thermal power industry to achieve ultra-low emissions, we are now actively advancing efforts towards ultra-low emissions in the steel industry. We also carried out special actions to review and reorganize more than 70,000 companies that were enlisted as small, poorly-managed, and heavily-polluting enterprises in 2018 and 2019 in 39 cities in the Beijing-Tianjin-Hebei region and surrounding areas and key areas in the Fenwei Plain region. We transferred the problems we found in the process to the local governments in a timely manner and urged them to rectify it.

Second, clean and low-carbon energy structure has been further improved. We concentrated resources to ensure the cleaner use of coal in non-industrial sectors in the Beijing-Tianjin-Hebei region and surrounding areas and the Fenwei Plain region, reducing non-centralized coal burning operations in more than 25 million households. We replaced the use of coal with cleaner energy over an area of 200,000 square kilometers south of Beijing. We provided guidance to the authorities in built-up city areas at the county level and above to help them to eliminate coal-fired boilers with a steam generating capacity of no more than 10 tons per hour. In the Beijing-Tianjin-Hebei region and surrounding areas, the Fenwei Plain region and the Yangtze River Delta, we eliminated coal-fired boilers with a steam generating capacity of no more than 35 tons per hour and upgraded coal-fired boilers with a steam generating capacity of no less than 65 tons per hour to achieve energy conservation and ultra-low emissions.

Third, the transportation system has become more eco-friendly. We stepped up efforts to construct special railway lines accessing major coastal ports and industrial and mining enterprises, thus raising the proportion of inland freight being carried by rail. Last year, China's railway cargo volume rose by 7.2% year on year. Starting from Jan. 1, 2019, we began to provide gasoline and diesel fuel that meets National-VI emission standards nationwide, thus unifying the use of automobile diesel fuels, general diesel fuels and some vessel fuels. The emission standards for general diesel fuels upgraded from National-IV to National-V and then to National-VI standards. We also implemented the National-VI emission standards nationwide for light-duty vehicles and actively promoted the wide use of clean energy vehicles. Since 2010, the number of new-energy automobiles on the roads has risen rapidly, with the proportion of electric buses among all public transport vehicles increasing from 20% in 2015 to the current 60%.

Fourth, pollution emanating from non-point sources has been effectively addressed. We developed a system to monitor dustfall in key regions and reported the dustfall of key cities every month. Last year, the average dustfall in the Beijing-Tianjin-Hebei region and surrounding areas, the Fenwei Plain region and the Yangtze River Delta were 7.5 tons, 6 tons and 4.4 tons per square kilometer, respectively, all meeting the goal. We also worked with other relevant departments to guide local governments to ban straw burning and promote recycling. Last year, the number of straw-burning sites nationwide decreased by 42% compared with that of 2015, according to satellite data.

Fifth, intra-regional prevention and control of air pollution has played an important role. We established a leading group to prevent and control air pollution in the Beijing-Tianjin-Hebei region and surrounding areas, as well as a collaborative group to address air pollution in the Fenwei Plain. We drew up and implemented action plans to comprehensively address air pollution in autumn and winter in the Beijing-Tianjin-Hebei region and surrounding areas, the Yangtze River Delta and the Fenwei Plain. We enhanced pollution treatment at key times and took targeted measures. In order to respond to heavy air pollution scientifically, precisely and effectively, in accordance with the law, we issued guidelines on strengthening heavy air pollution treatment and emergency emission reduction measures. By doing so, we adopted differentiated emission reduction measures based on performance in 39 key industries, curbing pollution in a targeted and scientific way.

Next, we will actively advance the structural upgrading of industry, energy, transportation, and land use; prioritize pollution treatment at key times, in key regions, in key industries to counter key pollutants; and pay special attention to strengthening the coordinated control of PM2.5 and ozone levels. We will also further define the key regions for air pollution treatment, enhance intra-regional prevention and control, and response to heavy air pollution. We will improve environmental monitoring, supervision and law enforcement. We will continuously widen the achievements of air pollution treatment and further improve air quality to provide our people with better and cleaner air. Thank you.

Southern Metropolis Daily:

China piloted an eco-compensation mechanism during the 13th Five-Year Plan period. With lessons learnt and problems identified, what will the country do under the 14th Five-Year Plan? Thank you.

Zhao Yingmin:

The eco-compensation mechanism is a very important initiative of institutional innovation. People have been quite concerned about how to share responsibilities through a market approach while advancing ecological conservation. We have achieved much through pilot programs during the 13th Five-Year Plan period. From now, we will sum up experiences and introduce the mechanism more widely. Particularly, we will motivate all parties along both upstream and downstream areas, left and right banks, and in the areas producing ecological products, and clarify each party's rights and responsibilities. Pursuing a holistic approach to conserving mountains, rivers, forests, farmlands, lakes, and grasslands in a coordinated way, we hope to realize joint protection and common development of all river basins through this mechanism.

www.dzwww.com:

Science and technology (S&T) innovation is the solution to prominent ecological challenges. Can you introduce some important research fruits in ecological S&T achieved during the 13th Five-Year Plan period? And what is the plan of the next five years? Thank you.

Zhao Yingmin:

Thanks for your questions. S&T indeed has become an important and effective means for improving the ecological environment, tackling climate changes, realizing green, low-carbon and high-quality development. 

In recent years, supported by the Ministry of Science and Technology and the Ministry of Finance, the Ministry of Ecology and Environment has been comprehensively implementing the decisions and deployments of the CPC Central Committee and the State Council and undertaking reforms in the S&T system. Through problem-oriented, demand-oriented, and result-oriented approaches, we have made major progress as follows:

First, major research projects have been advanced in an orderly way. Not long ago, I introduced the national research project on air pollution to the public, expounding reasons for the smog blanketing in the Beijing-Tianjin-Hebei region. This is an example of S&T supporting environmental protection. We have also launched major research projects on water pollution control and treatment. During the 13th Five-Year Plan period, the central government allocated more than 10 billion yuan of scientific and technological inputs in improving the ecological environment. 

Second, S&T system reform has proceeded in a smooth manner. To better delegate powers, streamline administration and optimize services, we have introduced a series of documents such as the guidelines on deepening reforms of the system for ecological and environmental S&T to boost innovation, and measures for implementing and deepening reforms of S&T project assessment, talent evaluation, and institutional assessment.

Third, S&T research fruits have been significantly applied and promoted.

Fourth, S&T research and application organizations have made fresh innovations. Under the model of "1 plus X", we have set up a national air pollution control and treatment joint research center, and national joint research center on protecting and restoring ecological environment of the Yangtze River, enabling about 8,000 S&T staff from more than 500 institutions to coordinate their research. Specialists in different fields from different departments and regions are brought together to form a high-level joint research team and play an important role in advancing ecological S&T.  

Thanks to the joint efforts of ecology S&T staff, our research during the 13th Five-Year Plan period has been fruitful. In the area of water environment, we achieved eight important fruits including the development and application of a whole process water pollution control system in key industries. We have also established three major technology systems to control and treat river basin pollution, manage the water environment in river basins, and guarantee the safety of drinking water, contributing to improvement of the water environment of the Taihu Lake, Beijing-Tianjin-Hebei region, Three Gorges Reservoir region, Huaihe River and Liaohe River, supporting key projects such as the South-to-North Water Diversion Project and providing high-quality water to the venues of Beijing International Horticultural Exposition and Beijing Winter Olympics. We have launched demonstration projects to remediate soil contaminated by heavy metals such as chromium and arsenic, providing strong S&T support for the improvements therein and also in people's living environment, as well as quality of agricultural products.

In ecological conservation, we have set up a technological system to draw red lines for protecting the ecosystems, contributing to the establishment of a nature reserve management system composed mainly of national parks. In solid waste, we have achieved breakthroughs in turning bulk industrial solid waste into building materials, waste-to-energy incineration technology, and hazard-free treatment of heavy metals, giving the building of waste-free cities a boost. To protect aquatic life, we have also issued the country's first criteria on cadmium and ammonia nitrogen levels in water bodies.  

To win the fight against pollution and serve high-quality economic development, we will focus our efforts on improving the ecological environment, enhance scientific, precise, lawful, systematic and smart pollution treatment, deepen reforms of the system for ecological and environmental S&T, speed up upgrading the ecological and environmental S&T innovation system in the new era, and ultimately empower the building of a beautiful China. Thank you.

Red Star News:

What progress has been made in regard to the rule of law on the environment? What measures will be taken in the future? Thank you. 

Zhao Yingmin:

Thank you for your question. In the 13th Five-Year Plan period, remarkable achievements have been made in terms of applying the rule of law, which is a very important aspect [when it comes to the protection of ecological environment]. In order to improve environmental quality and prevent water, air, soil and solid waste contamination, we have promoted a sound legal framework in regard to protection of the ecological environment; integrated the rule of law with various reforms; formulated and revised the ecological environment standards; promoted the reform of the compensation system on ecological environmental damage, and set up a sound legal framework to serve the cause of pollution prevention and control. The achievements can be seen in three aspects:

First, we have ramped up efforts to formulate and revise the laws regarding the ecological environment. Many laws and regulations on the protection of the ecological environment have been formulated and revised over the past five years, among them the Environmental Protection Tax Law, the Law on the Prevention and Control of Water Pollution, the Nuclear Safety Law, the Law on the Prevention and Control of Environmental Pollution by Solid Waste and the Biosecurity Law. Revisions to the Law on Prevention and Control of Pollution from Environmental Noise, the Marine Environment Protection Law and the Environmental Impact Assessment Law are still ongoing. The Standing Committee of the National People's Congress (NPC) is deliberating the draft law on Yangtze River conservation. 

Second, we have been improving the environmental standards and policy systems. We have formulated, revised and promulgated 551 national standards for ecological environment, including four environmental quality standards, 37 standards for pollutant discharge, eight basic environmental standards, 305 environmental monitoring standards and 197 technical regulations for environmental management. As many as 122 standards have been promulgated to serve the implementation of the "ten measures for air," 107 to serve the "ten measures of water," as well as 89 to serve the "ten measures of soil" (49 ones concerning soil and 40 concerning solid waste).

Third, achievements have been made in the reform of the compensation system on ecological environment damage. At the end of 2017, the General Office of the CPC Central Committee and the General Office of the State Council issued a reform plan for the ecological environment damage compensation system, to further reform the ecological environment damage compensation system in the pilots nationwide, with the environmental protection inspection being the new measure. Last year, the Supreme People's Court issued the Provisions on the Trial of Cases on Compensation for Damage to the Ecological Environment, and liability for damaging the ecological environment has also been codified in the Civil Code, which is an initial success for the ecological environment damage compensation system. A total of 1,674 cases related to environment damage compensation had been dealt with as of September. 

Next, we will continue to improve the legal framework for the protection of ecological environment by following the principle of coping with pollution in a targeted, scientific and law-based manner. We will establish a sound environmental standard system and an environmental technical management system. Moreover, we will also strictly implement the laws and regulations concerning environmental protection, so as to build new effective services and to ensure meeting new demands of ecological environmental protection. Thank you.

Bauhinia Magazine:

We are very concerned about the progress of the formulation of the plan for the protection of ecological environment in the Guangdong-Hong Kong-Macao Greater Bay Area. What measures will the Ministry of Ecology and Environment take to boost the protection of the ecological environment there? Thank you.

Zhao Yingmin:

The plan for the protection of ecological environment in the Guangdong-Hong Kong-Macao Greater Bay Area has been completed, and our future priority is implementation. Guangdong, Hong Kong and Macao should leverage their own strengths, take responsibility to protect the ecological environment, and work together, so as to contribute to high-quality development in the region. Thank you.

Shou Xiaoli: 

That ends today's press conference. Many thanks to Mr. Zhao as well as our media friends. Goodbye.

Translated and edited by Chen Chao, Wang Qian, Zhang Rui, Zhang Liying, Wang Yiming, Zhu Bochen, Yuan Fang, Xu Xiaoxuan, Zhang Junmian, Yan Xiaoqing, Wang Wei, Li Xiao, Huang Shan, Fan Junmei, Yang Xi, Gong Yingchun, Geoffrey Murray, David Ball, Laura Zheng, and Jay Birbeck. In case of any dispute over a discrepancy, the Chinese version is deemed to prevail.

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Read in Chinese

Speaker:

Ms. Liu Aihua, spokesperson of the National Bureau of Statistics (NBS) and director general of its Department of Comprehensive Statistics

Chairperson:

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office

Date:

Oct. 19, 2020

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this SCIO press conference where we are releasing China's latest economic data. We are pleased to welcome Ms. Liu Aihua, spokesperson of the National Bureau of Statistics (NBS) and director general of its Department of Comprehensive Statistics, to introduce details of the economic performance in the first three quarters of 2020 and answer your questions. First, let's give the floor to Ms. Liu.

Liu Aihua:

Thank you. Good morning, everyone. I'll first give you a brief introduction of economic performance in the first three quarters of 2020, and then answer your questions. The economic growth in the period shifted from negative to positive.

Faced with the great impact of the COVID-19 pandemic and the complicated and severe environment both 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, all regions and departments coordinated their efforts to advance both the epidemic prevention and control and the economic and social development in a scientific way, and effectively promoted restoration of production and life order. Economic growth shifted from negative to positive, the relations between supply and demand gradually improved, the vitality and dynamics of the market were enhanced, and the employment and people's livelihood were well guaranteed. The national economy continued its steady recovery and overall social stability was maintained.

According to preliminary estimates, the gross domestic product (GDP) was 72.28 trillion yuan in the first three quarters, a year-on-year growth of 0.7% at comparable prices. Specifically, the GDP for the first quarter declined by 6.8% year-on-year, increased by 3.2% in the second quarter, and up by 4.9% in the third quarter. By industry, the added value of the primary industry was 4.81 trillion yuan, up 2.3% year-on-year; secondary industry 27.43 trillion yuan, up by 0.9%; tertiary industry 40.04 trillion yuan, up by 0.4%. GDP for the third quarter grew by 2.7% quarter-on-quarter. 

In detail, first, agricultural production maintained good momentum with another bumper harvest expected for autumn grain.

In the first three quarters, the added value of agriculture (crop farming) grew by 3.8% year-on-year, matching the first half of the year. Specifically, that of the third quarter grew by 3.9%. The total output of summer grain and early rice totaled 170.10 million tons, a year-on-year growth of 2.24 million tons. The sown area for autumn grain saw a stable increase, major crops for autumn grain grew well and another bumper harvest is expected for autumn grain. The planting structure was further optimized, with the sown areas of quality rice and soybean continuing to expand. In the first three quarters, the output of milk grew by 8.1%, and that of eggs 5.1%. The output of pork, beef, mutton and poultry dropped by 4.7%, a decline narrowing by 6.1 percentage points compared with that of the first half of this year. Specifically, the output of poultry grew by 6.5%, and output of beef, mutton and pork dropped by 1.7%, 1.8% and 10.8% respectively, a decline narrowing by 1.7 percentage points, 0.7 percentage points and 8.3 percentage points compared with that of the first half of this year. Pig production capacity gradually recovered. By the end of the third quarter, 370.39 million pigs were registered in stock, up by 20.7% year-on-year, among which, 38.22 million were breeding sows, up by 28.0%. 

Second, industrial production continued to accelerate with high-tech manufacturing and equipment manufacturing growing fast.

In the first three quarters, the total added value of industrial enterprises above designated size grew by 1.2% year-on-year, while that of the first half of this year was down by 1.3%. Specifically, the third quarter saw growth of 5.8% year-on-year, 1.4 percentage points faster than the second quarter. In September, the total added value of industrial enterprises above designated size rose by 6.9% year-on-year, growing for the sixth consecutive month, or 1.3 percentage points faster than the growth of August, with month-on-month growth of 1.18%. An analysis by ownership type showed that, in the first three quarters, the added value of State holding enterprises grew by 0.9% year-on-year; that of share-holding enterprises was up 1.5%; that of enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan up 0.3%; and that of private enterprises up 2.1%. In terms of sectors, the added value of mining went down by 0.6% year-on-year, a decline narrowing by 0.5 percentage points compared with the first half of this year; manufacturing was up 1.7% and the production and supply of electricity, thermal power, gas and water rose 0.8%, compared with a decline of 1.4% and 0.9% respectively in the first half of this year. In the first three quarters, the added value of high-tech manufacturing and equipment manufacturing grew by 5.9% and 4.7% year-on-year. In terms of the output of products, in the first three quarters, production of trucks, excavators and shoveling machinery, industrial robots and integrated circuits respectively grew 23.4%, 20.2%, 18.2% and 14.7% year-on-year. In the first eight months, the total profits made by industrial enterprises above designated size totaled 3.72 trillion yuan, down by 4.4% year-on-year, a decline narrowing by 3.7 percentage points compared with that of the first seven months. The Manufacturing Purchasing Managers' Index stood at 51.5% in September, 0.5 percentage points higher than August, staying above the threshold for seven consecutive months.

Third, service sector recovered steadily and modern service industries grew well.

In the first three quarters, the service sector witnessed steady recovery. In the third quarter, the total value added of the tertiary industry grew by 4.3%, which was 2.4 percentage points faster than in the second quarter. In the first three quarters, in the modern service industries, the value added for information transmission, software and information technology services, and financial services grew by 15.9% and 7% respectively, or 1.4 percentage points and 0.4 percentage points higher than that in the first half of the year. The Index of Services Production fell by 2.6% year on year, a decline which narrowed by 3.5 percentage points compared with that of the first half of the year; specifically, that of September grew by 5.4%, 1.4 percentage points faster than that of August. In the first eight months of this year, the business revenue of service enterprises above designated size dropped by 2.5% year-on-year, a decline narrowed by 1.3 percentage points compared with that of the first seven months; specifically, that of information transmission, software and information technology services went up by 11.4%. In September, the Business Activity Index for services was 55.2%, 0.9 percentage points higher than that of August. In particular, the Business Activity Index for transportation, telecommunication, internet and software, and accommodation and catering all remained above 60%. In terms of market expectations, the Business Activities Expectation Index for Services was 62.2%, 0.9 percentage points higher than in August.

Liu Aihua:

Fourth, market sales improved significantly with online retail sales of physical goods sustaining fast growth.

In the first three quarters, the total retail sales of consumer goods reached 27.33 trillion yuan, down by 7.2% year-on-year, a decline narrowed by 4.2 percentage points compared with that of the first half of this year; specifically, that of the third quarter grew by 0.9%, the first positive quarterly growth in 2020. In September, the total retail sales of consumer goods reached 3.52 trillion yuan, up by 3.3% year on year, and 2.8 percentage points faster than that of August, maintaining growth for two consecutive months. In terms of different regions, retail sales in urban areas in the first three quarters reached 23.68 trillion yuan, marking a decline of 7.3%, and retail sales in rural areas reached 3.64 trillion yuan, a decline of 6.7%. Grouped by consumption patterns, the income from catering was 2.52 trillion yuan, down by 23.9%; and retail sales of goods was 24.81 trillion yuan, down by 5.1%. Upgraded consumer goods grew quickly. Retail sales of telecommunication equipment, sports and recreational goods, and cosmetics grew by 7.2%, 6.8% and 4.5% respectively. In the first three quarters, online retail sales reached 8 trillion yuan, a year-on-year growth of 9.7%, and 2.4 percentage points faster than that of the first half of this year. Specifically, the online retail sales of physical goods hit 6.64 trillion yuan, up by 15.3%, and accounting for 24.3% of the total retail sales of consumer goods. 

Fifth, investment in fixed assets shifted from negative to positive growth and investment in high-tech industries and social sector continued to rise.

In the first three quarters, investment in fixed assets (excluding rural households) reached 43.65 trillion yuan, up by 0.8% year-on-year and shifting from negative to positive for the first time in 2020, while that of the first half of this year was down by 3.1%. Specifically, investment in infrastructure grew by 0.2%, shifting from negative to positive for the first time this year, while that of the first half of 2020 was down by 2.7%; investment in manufacturing dropped by 6.5%, a decline narrowed by 5.2 percentage points compared with that of the first half of 2020; and investment in real estate development grew by 5.6%, 3.7 percentage points faster than that of the first half of 2020. The floor space of commercial buildings sold reached 1.17 billion square meters, down by 1.8%, a decline narrowed by 6.6 percentage points compared with that of the first half of 2020; and total sales of commercial buildings reached 11.56 trillion yuan, up by 3.7%, while that of the first half of 2020 fell by 5.4%. By industry, investment in the primary industry rose by 14.5%, a growth of 10.7 percentage points higher than that of the first half of the year; the secondary industry fell by 3.4%, a decline narrowed by 4.9 percentage points compared with that of the first half of the year; and the tertiary industry increased by 2.3%, while that of the first half was down by 1%. Private investment reached 24.39 trillion yuan, down by 1.5%, a decline narrowed by 5.8 percentage points compared with that of the first half of 2020. Investment in the high-tech industry grew by 9.1%, which was 2.8 percentage points faster than that of the first half of the year. Of this total, investment in high-tech manufacturing and high-tech services grew by 9.3% and 8.7% respectively. In terms of high-tech manufacturing, investment in pharmaceutical manufacturing, and the manufacturing of computers and office devices grew by 21.2% and 9.3% respectively. In terms of high-tech services, investment in e-commerce services, information services and services for the commercialization of research findings grew by 20.4%, 16.9% and 16.8%. Investment in social sectors grew by 9.2%, which was 3.9 percentage points higher than that of the first half of 2020. Of the total, investment in the health sector and education sector grew by 20.3% and 12.7% respectively, or 5.1 percentage points and 1.9 percentage points faster than that of the first half of 2020. In September, investment in fixed assets (excluding rural households) grew by 3.37% month on month. 

Liu Aihua:

Sixth, imports and exports of goods shifted from decline to growth and trade structure continued to optimize.

In the first three quarters, the total value of imports and exports reached 23.12 trillion yuan, up by 0.7% year-on-year, shifting from negative to positive for the first time in 2020; specifically, that of the third quarter grew by 7.5% year on year, while that of the second quarter was down by 0.2%. The value of exports rose 1.8% to 12.71 trillion yuan, while the value of imports dropped 0.6% to 10.4 trillion yuan. The trade balance was 2.3 trillion yuan in surplus. In September, the total value of imports and exports was 3.06 trillion yuan, up by 10% year on year. The value of exports was 1.66 trillion yuan, up by 8.7%; and the value of imports was 1.4 trillion yuan, up by 11.6%. The trade structure continued to optimize. In the first three quarters, the import and export of general trade accounted for 60.2% of the total value of imports and exports, 0.8 percentage points higher than the same period last year. Exports of mechanical and electrical products grew by 3.2%, while that of the first half of 2020 was down by 2.3%. Imports and exports by private enterprises grew by 10.2%, accounting for 46.1% of all imports and exports, which was 4 percentage points higher than the same period last year.

Seventh, growth of consumer prices fell and producer prices for industrial products declined year-on-year.

In the first three quarters, the national Consumer Price Index increased by 3.3% year on year, 0.5 percentage points lower than that of the first half of 2020. Specifically, prices rose by 3.1% in urban areas and by 4.1% in rural areas. In September, consumer prices were up by 1.7% year on year, rising by 0.2% month on month. Grouped in terms of commodity categories, in the first three quarters, the prices of food, tobacco and alcohol increased by 10.9% year on year; clothing was down by 0.2%; housing dropped by 0.3%; articles and services for daily use were up by 0.1%; transportation and communication fell by 3.5%; education, culture and recreation rose by 1.4%; medical services and healthcare were up by 1.9%; and other articles and services increased by 5%. In terms of food, tobacco and alcohol prices, prices for grain rose by 1.2%; fresh vegetables increased by 6.1%; and pork increased by 82.4%, down 21.9 percentage points compared with the first half of this year. Core CPI excluding the prices of food and energy went up by 0.9%. 

In the first three quarters, producer prices for industrial products decreased by 2% year on year. Specifically, prices in September were down by 2.1% year-on-year, or up by 0.1% month on month. In the first three quarters, the purchasing prices for industrial producers fell by 2.6% year-on-year; specifically, in September, prices were down by 2.3% year-on-year, or up by 0.4% month-on-month.

Eighth, the surveyed unemployment rate in urban areas dropped, and the employment situation is generally stable.

The first three quarters saw the addition of 8.98 million new urban jobs, meeting 99.8% of the annual target. In September, the surveyed unemployment rate in urban areas was 5.4%, or 0.2 percentage points lower than that of August; the surveyed unemployment rate of the population in the 25-59 age range was 4.8%, lower than that of the surveyed unemployment rate in urban areas by 0.6 percentage points, the same as August. The surveyed unemployment rate in 31 major cities was 5.5%, down 0.2 percentage points from August. The average weekly working hours of employees in enterprises across the country stood at 46.8 hours. At the end of the third quarter, the total number of rural migrant workers stood at 179.52 million, a decrease of 3.84 million compared with the same period of last year, with a year-on-year decrease of 2.1%.

Ninth, the real growth rate of residents' income turned from negative to positive, and the ratio of per capita income of urban and rural residents decreased.

In the first three quarters, the per capita disposable income of all residents reached 23,781 yuan, a nominal increase of 3.9% over the same period of the previous year. Deducting the price factor, the actual increase being 0.6%. It was the first time to turn positive this year, with a decrease of 1.3% in the first half of the year. In terms of permanent residents, the per capita disposable income of urban residents was 32,821 yuan, with a nominal increase of 2.8% and an actual decrease of 0.3%; the per capita disposable income of rural residents was 12,297 yuan, with a nominal increase of 5.8% and an actual increase of 1.6%. The per capita disposable income ratio of urban and rural residents was 2.67, or 0.08 less than that of the same period last year. The median per capita disposable income of all residents was 20,512 yuan, a nominal increase of 3.2% year-on-year.

On the whole, the economic operation in the first three quarters continued a steady recovery, and the overall epidemic prevention and development achieved remarkable results. However, it should also be noted that the international environment is still complicated and with lots of instability and uncertainty; the pressure of preventing both inbound cases and domestic resurgence is huge. The economy is still in the recovery mode, and the foundations for sustainable recovery and improvement still need to be consolidated. The work in the next stage should be guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. We will conscientiously implement the instructions and deployment of the CPC Central Committee and the State Council, sticking to the general line of maintaining steady progress in line with the requirements of promoting high quality development and building a new development pattern, firmly grasp the strategic basis for expanding domestic demand, and do a solid job in ensuring stability on six fronts and maintaining security in six areas while maintaining vigilance against the virus. We will vigorously seek deeper reform and opening up, help enterprises to solve difficulties, strive to smooth over the economic cycle, build a solid foundation for people's livelihood, and strive to complete the annual economic and social development goals and tasks.

Shou Xiaoli:

Thank you. The floor is open for questions. Please state the news outlet you represent first.

CCTV:

In the first three quarters, China's economic growth has turned positive. How do you evaluate the overall economic performance? The growth rate in the third quarter rebounded steadily, and the main indicators improved significantly in September. What do you think of this performance? Thank you.

Liu Aihua:

Thanks for your question. Facing the COVID-19 pandemic and especially complicated and severe environment both at home and abroad in the first three quarters, all areas and departments have made comprehensive arrangements for epidemic prevention and control, as well as promotion of economic and social development. Production and normal life have been restored effectively. On the whole, the economic growth rate in the first three quarters turned from decline to increase, and the economic operation continued to recover steadily. The main characteristics can be seen from three aspects:

First, the growth rate of the main indicators has turned from negative to positive. From the cumulative point of view, GDP in the first three quarters increased by 0.7% year-on-year. Considering the GDP had decreased by 1.6% in the first half of the year, we can say that the decline has been reversed. The added value of the three industrial categories rebounded in an all-round way. The added value of the primary industry increased by 2.3%, that of the secondary industry increased by 0.9%, and that of the tertiary industry increased by 0.4%, all of which were positive. Investment in fixed assets increased by 0.8%, the total import and export of goods increased by 0.7%, and per capita real disposable income increased by 0.6%. From the perspective of the current quarter, GDP in the third quarter increased by 4.9%, 1.7 percentage points faster than that in the second quarter; the added value of industries above designated size increased by 5.8%, 1.4 percentage points faster than the second quarter; the added value of the service industry increased by 4.3%, 2.4 percentage points faster than the second quarter. There are also two indicators turning from negative to positive: first, the total retail sales of consumer goods, which fell 3.9% in the second quarter, but increased by 0.9% in the current quarter; the total import and export of goods, which declined 0.2% in the second quarter, increased by 7.5% in the current quarter. In September, the added value of industries above designated size increased by 6.9%, maintaining positive growth for six consecutive months; the production index of the service sector increased by 5.4%, meaning positive growth for five consecutive months; total retail sales of consumer goods increased by 3.3%, meaning positive growth for two consecutive months; and the total import and export of goods increased by 10%, positive growth for four consecutive months. With the change of these main indicators, we can say that China's epidemic prevention and control and economic recovery are leading the world, demonstrating the strong resilience and vitality of China's economy.

Second, jobs and people's livelihood are well guaranteed. In the face of unprecedented employment pressures at the beginning of this year, all local authorities and government departments implemented a policy giving priority to employment. People's livelihood has guaranteed and improved with the continuous increase of coffer budget. First of all, let's take a look at employment. A total of 8.98 million new urban jobs were created in the first three quarters, almost meeting the annual target. The surveyed unemployment rate is stable with a decline in September in urban areas to 5.4%, compared to 6.2% at the beginning of this year. The national per capita disposable income of residents in the first three quarters witnessed a real increase of 0.6%, roughly in line with the 0.7% of economic growth. Price increases have been moderate. The consumer price in the first three quarters grew by 3.3% year-on-year. Specifically, the consumer price index in September went up by 1.7% year-on-year. Social security has provided particularly strong bottom-line support this year. The national per capita pension and retirement pension posted an 8.7% nominal increase year-on-year; per capita income from social relief and subsidies grew 12.9% and per capita income from policy-based living subsidies expanding 11.1%. They all maintained rapid growth, far faster than the overall growth of residents' income.

Third, new growth drivers are playing a leading role. Under the impact of the epidemic, the impetus for industrial transformation and development has accelerated significantly. New driving forces represented by the Internet economy are growing and have played a positive role in helping the epidemic prevention and control, ensuring people's livelihood and boosting economic growth. In the first three quarters, the added value of high-tech manufacturing and equipment manufacturing grew by 5.9% and 4.7% year on year respectively, both faster than the growth in the first half of the year. Investment in high-tech industry grew by 9.1%, posting big growth of 2.8 percentage points faster than the first half. New business forms and models like online shopping and livestream selling has continued apace. There is a strong emerging demand for working from home, online medical consultation and online education. The online retail sales of physical goods in the first three quarters went up by 15.3% year-on-year, one percentage point faster than the first half of the year, accounting for 24.3% of the total retail sales of consumer goods. The new infrastructure and consumption featured by 5G construction and rail transportation has played an enhanced leading role. In September, the output of urban rail vehicles, smart watches and new energy vehicles increased by more than 50%, 70% and 50% year-on-year respectively. Generally speaking, these new economic sectors are playing a significant role in driving the overall economy.

On the whole, the overall national economy continued a steady recovery in the first three quarters. However, while fully recognizing the trend of recovery, we should also note that the current epidemic situation overseas is still severe and the international environment remains instable and uncertain, together with insufficient effective domestic demands and imbalanced recovery in different regions, sectors and enterprises. The foundation for sustained recovery needs to be consolidated. So, next we would stick to the requirement of promoting high-quality development and building new development pattern, and making solid efforts to stabilize employment, finance, foreign trade, foreign investment, domestic investment, and meeting market expectations, comprehensively, implementing the tasks to safeguard employment, people's livelihood, market entities' prosperity, food and energy security, stability of industrial and supply chains and operations at grassroots levels, forge a solid foundation for safeguarding people's livelihood and assist enterprises addressing difficulties in order to fulfil the whole-year targets for development. Thank you.

Beijing Youth Daily:

Recently, the International Monetary Fund (IMF) raised its forecast for China's economic growth for the whole year. Do you think China's economic recovery will accelerate in the fourth quarter? How would you forecast China's economic trend for the whole year? What do you think the main difficulties are facing China's economic operation at present? Thank you.

Liu Aihua:

Thanks for asking. Given the fact that the economy as a whole showed sustained and steady recovery in the first three quarters, with a growth of 4.9% in the third quarter in particular, people are more concerned about whether the trend will continue in the next stage. In terms of various factors including demand and production as well as the confidence and vitality of the whole market, we believe we have the foundation, conditions and confidence to maintain the current trend in the fourth quarter and even for the whole year.

First, demand is gradually picking up. Investment in fixed assets went up by 0.8% year-on-year in the first three quarters, shifting from negative to positive for the first time in 2020. In terms of leading indicators, the total planned investment in new projects registered year-on-year growth of 14.6% in the first three quarters, a double-digit growth rate that is 1.1 percentage points faster than the first half of the year. The funds actually allocated for fixed asset investment increased by 4.8% this year, flat with that in the first half of the year. Investments will continue the current trend from negative to positive and further rebounding. Regarding consumption, the quarterly growth rate of total retail sales of consumer goods turned positive for the first time this year. In terms of growth, the growth rate of 14 of the 18 surveyed commodity categories turned positive, and six of them achieved double-digit growth. Regarding the service industry, the average daily sales of the national retail and catering businesses under close monitoring grew 4.9% year-on-year during the golden week of the National Day and Mid-Autumn Day holiday, according to data from relevant monitoring authorities. You might have felt the popularity of scenic spots and cinemas during the golden week. On a comparable basis, the number of visitors has rebounded to 80% of that of last year while the revenue has recovered 70%. The recovery is good and indicates that residents' demand for both physical goods and services consumptions is recovering against the context of the current effective epidemic prevention and control.

Second, the industrial cycles continue to improve. We have stepped up efforts this year to break through the industrial and supply chains sticking points in order to ensure the production of key industries and products. Generally speaking, the industrial cycles are gradually improving. Firstly, the rate of capacity utilization is rising quarter by quarter. China's industrial capacity utilization rate was 76.7% in the third quarter, up 2.3 percentage points from the second quarter. Specifically, auto manufacturing rebounded three percentage points, general equipment manufacturing 1.7% points, and computer communications and other electronic equipment manufacturing 0.5% points. The recovery of downstream industries, which had been lagging behind upstream industries, has also improved in recent months. The added value of consumer goods manufacturing above the designated size rose 3.2% year-on-year, compared to the 0.8% decline of last month and shifting to growth for the first time from declines in consecutive months. Most of the service sector registered positive growth. Six of the eight sectors that make up the service production index have registered positive growth, with double-digit growth in information transmission software and information technology services.

Third, market entities are showing rising confidence. In the first three quarters, the sense of gain among enterprises has been significantly enhanced because we have fully implemented policies to provide relief to businesses and advanced reforms to streamline administration and delegate power, improve regulation, and upgrade services. Positive results were achieved in tax and fee reductions. From January to August, the taxes and fees were further cut by a total of 1.88 trillion yuan, effectively reducing the burden on the operations of market entities. In August, industrial enterprises above designated size reduced their costs by 0.47 yuan per 100 yuan of business income on a year-on-year basis. Business profits have also continued to grow. In August, the profits of industrial enterprises above designated size increased by 19.1% year-on-year, with positive growth for four consecutive months. In August, the profits of service enterprises above designated size increased by 15.5% year-on-year, also an encouraging double-digit growth. Among them, profits of high-tech service enterprises increased by 34.7%. In terms of business expectations, the manufacturing purchasing managers' index stood at 51.5% in September, and for the non-manufacturing business activity, the figure was 55.9%, an increase of 0.5 and 0.7 percentage points respectively over August, both staying above the threshold for seven consecutive months. 

In the next stage, the favorable conditions reflected in these three aspects will enable us to further exploit the potential and stimulate the demand of China's super-large market. Generally speaking, we are confident in the economic development of the whole year. Thank you.

Bloomberg: 

In the data, the retail sales were down 7.2% in the nine months through September and real disposable urban income is down 0.3% in the same period. With income falling, it's not surprising that retail sales haven't rebounded. What will the government do to support private incomes so that you can realize the new model of dual-circulation which is meant to boost domestic demand. Thank you. 

Liu Aihua:

Thank you for your question. Indeed, as you said, judging from the figures of the first three quarters, total retail sales of consumer goods fell by 7.2% in the first three quarters. The decline is mainly because of the impact of the epidemic on consumption demand. In recent months, the growth rate of total retail sales of consumer goods has shown a trend of rebounding. As I mentioned earlier, the growth rate in September was 3.3%, and we have achieved positive growth for two consecutive months. Viewed from the trend, it can be said that the current retail industry has managed to get through the heavy blow from the epidemic and is recovering. In terms of actual performance, while online consumption is maintaining rapid growth, consumption in physical stores also shows momentum of accelerated recovery. I said that the online retail sales of physical goods were up by 15.3% year-on-year. Our research shows that consumption in physical stores is also in the process of recovery. For example, the sales of some supermarkets in the first three quarters increased by 2.9%, indicating that, with the effective control of the epidemic, more people are willing to leave their homes and spend money in physical stores. Hence, consumption in physical stores has bounced back to a certain extent.

The second change is that while consumption of physical goods maintains a relatively rapid growth, service consumption is also recovering. The retail sales of consumer goods in September increased by 4.1%, showing positive growth for several consecutive months. In terms of service consumption, industries that were previously hit hard by the epidemic, such as the accommodation and catering sector, have also shown a recovery trend. The income of the catering sector fell by 2.9% in September. The decline has narrowed for several consecutive months, and has gradually returned to normal levels. 

The third is that, while consumption of basic consumer goods has maintained relatively rapid growth, products related to consumption upgrading also saw growing momentum. In the first three quarters, staying at home due to the COVID-19 made people spend more on items such as food, tobacco and alcohol. These kinds of products maintained relatively rapid growth. At the same time, the consumption of products related to consumption upgrading, including cosmetics, gold and silver and jewels, and automobiles, also grew rapidly. These categories realized double-digit returns in September.

Judging from these aspects, the overall recovery of domestic demand is relatively obvious, especially consumption demand. In the second quarter, contribution of final consumption expenditure to GDP growth was a negative 2.3 percentage points, while in the third quarter, the contribution was a positive 1.7 percentage points. From a negative 4.4 percentage points in the first quarter, narrowing down to a negative 2.3 percentage points in the second quarter, to a positive figure of 1.7 percentage points in the third quarter, I think the changes indeed show final consumption expenditure has rebounded after the falls of the previous two quarters. Therefore, generally speaking, the contribution of domestic demand continues to recover and rise. It provides favorable conditions for us to foster a new dual-cycle development architecture. The unlocking of the potential of China's super-large market is not only a manifestation of our strategic focus of boosting domestic demand, but also benefits world economic recovery. Thank you.

CNBC:

I have two questions. The first one is concerned with the employment of graduates and migrant workers. What is the employment situation in the hometowns of those migrant workers who did not choose to return to cities this year? The second question is on consumption. What is the future of e-commerce, after securing rapid growth this year, when its proportion has undergone fewer volatilities than others?

Liu Aihua:

Thank you for your questions. The first one involves the employment status of graduates from institutes of higher education as well as migrant workers. Based on the data, the pressure to ensure fresh graduates' employment has been relieved since September, and the job market has gained good momentum. The pandemic earlier this year has negatively impacted the employment prospects of graduates. However, the turning point appeared in September when the graduation season came to an end, and the employment rate showed robust signs of recovery. In September, the unemployment rate observed for graduates aged 20 - 24 from junior college and above dropped by 2.4 percentage points. Concerning the employment of migrant workers, there were 179 million migrant workers in the third quarter this year, an increase of 2 million compared with the second quarter, which indicates the growth of the migrant labor force. The unemployment rate in cities and towns among migrant workers has continued to decline each month, indicating a good momentum regarding employment in this particular sector.

However, it remains challenging to find employment this year. Despite the monthly drop of 2.4 percentage points of the unemployed graduates aged 20 - 24 from junior college and above in September, the rate remains 4 percentage points higher year on year, indicating a much-strained scene for this year's graduates. Meanwhile, despite the growth of the migrant labor force from the third quarter, employed laborers remained about 3.8 million less compared to last year, registering a year-on-year decline of 2.1%. That is why we need to reinforce the implementation of policies designed to protect market entities, assist enterprises in solving financial problems and stimulate flexible employment so that the employment of those targeted groups can be improved. 

Your second question is on online consumption. Based on today's data, e-commerce retailers are growing against the trend. In the first three quarters, sales of physical commodities from those retailers jumped 15.3% year-on-year, accounting for 24.3% of the total sales. The growth compared to the 7.2% fall of the entire retail sector is both uneasy and remarkable to achieve. So the 24.3% proportion is a result of gradual growth. Generally speaking, e-commerce consumption has played a significant role in upholding people's livelihoods, maintaining economic growth and preventing and controlling the pandemic from further spreading. Thank you.  

Market News International:

Could you please explain in detail how expenditure makes up the entire 1.7% consumption, including the capital formation？

Liu Aihua:

With this year's unique situation, a few contribution rates or three major points of demand turned negative. Therefore, we intended to release the data based on the points. During the first three quarters, the final consumption expenditure dropped by 2.5 percentage points; however, the aggregation of capital formation was up 3.1 percentage points. The net export of both commodities and services was up 0.1 percentage points, registering a GDP growth of 0.7% year-on-year. However, the rates or points are more discernible when we take a closer look at each quarter. During the third quarter, the final consumption expenditure rose by 1.7 percentage points, the capital formation up 2.6 percentage points and the net export of commodities and services up 0.6 percentage points. Compared to the second quarter, the final consumption expenditure increased by 4 percentage points, shifting from minus 2.3 percentage points to 1.7 percentage points. The capital formation fell by 2.4 percentage points from 5 percentage points to 2.6 percentage points. The net export of commodities and services was almost even -- between 0.5 percentage points in the second quarter and 0.6 percentage points in the third quarter. The impact of the coronavirus pandemic at the demand end, especially consumption, was prone to a significant impact in the first quarter. Therefore, with changes in the general situation, especially that in the second and third quarters, the final consumption expenditure grew gradually while the capital formation started to fall, which combined indicate a growing contribution of domestic demand. Thank you.

New York Times: 

The 0.6 percentage points contribution from foreign trade was a considerable widening in the trade surplus. Is that sustainable going forward? Particularly, is it sustainable given that it partly seems to depend on a decrease in the number of imported education services, in effect, due to the decline in students going out? Thank you. 

Liu Aihua:

Thank you for your question. The net exports of goods and services contributed 0.1 percentage points to the GDP growth in the first three quarters, and 0.6 percentage points in the third quarter. China's GDP grew 4.9% year-on-year in the third quarter. Net exports of goods and services contributed 0.6 percentage points; final consumption expenditure and gross capital formation contributed 4.3 percentage points. Generally, domestic demand is the primary driving force behind economic growth. You asked why export performance is good this year, saying that the widening trade surplus may result from a decrease in imports. This seems inconsistent with the statistics of the month. In September, China's exports grew by 8.7%, and imports by 11.6%. Generally, the increase in exports was attributable to some objective factors. For example, China leads the world in epidemic control. Chinese enterprises' returning to normal work contributes to global work resumption and epidemic control. In terms of imports, as China's economy rebounds and domestic demand picks up steam, our demand for imports is also increasing. Overall, China's current economic rebound not only drives its own growth but also boosts global economic recovery.

CNR:

Door-to-door registration for China's seventh national population census has kicked off. Could you brief us on the latest progress? Different from previous ones, this year's census is being taken in the context of epidemic control. Does the NBS have any plan to deal with the special situation? What role does the population census play in formulating China's 14th Five-Year Plan and future targets for 2035? Thank you.

Liu Aihua:

Thank you for your attention to the national population census. As many of you may know, door-to-door registration kicked off on Oct. 11 and will continue until Oct. 31. Some residents have already received phone calls or household visits. I want to share some knowledge about the national population census, as everyone present here is the object of the survey. The population provides the most basic information about the national condition and serves as the most fundamental production factor. China conducts a national population census every 10 years, and the current one is the 7th national population census. The nationwide census is of great significance because it is a major survey of our national condition and strength, conducted as socialism with Chinese characteristics, which has entered a new era during the decisive stage in building a moderately prosperous society in all respects and the period in which the time frames of the two centenary goals converge. From a macro perspective, an accurate census can give a full picture of the population size, structure and distribution, as well as the trend of the demographic change, providing support for formulating China's 14th Five-Year Plan.

An accurate census can also provide local governments with essential information which helps them supply and distribute elderly care and education facilities more reasonably. In this sense, a national population census concerns the interest of everyone. Door-to-door visits are an important exercise ahead of the national population census registration and a comprehensive test on the census' design and preparation work. Door-to-door visits started on Oct. 11 and will continue until Oct. 31. During the 20-day period, about 7 million staff will visit the homes of more than 400 million residents. The staff will introduce registration methods and ask questions about the basic demographic data of the households. For the first time, a population census can be conducted digitally this year. Census takers will offer appropriate assistance when residents choose to use mobile terminals such as cell phones to declare personal and family information. At present, door-to-door registration is being carried out in an orderly and steady manner.

As autumn turns to winter, the 7th nationwide population census being conducted, along with COVID-19 prevention and control, may present challenges to both census takers and residents. We've already developed an emergency plan in response to potential sporadic cases in some locations. The plan introduces registration methods for regions at different risk levels. In high-risk regions, data will be collected through phone calls and online questionnaires. In medium-risk regions, we will gather information by setting up outdoor registration stations and sending out online questionnaires. In low-risk regions, we will continue to make door-to-door household visits. In accordance with requirements for epidemic prevention and control, census takers on duty should be in good health and have normal body temperature. During household visits, they are required to wear masks, perform disinfection, and ensure personal protection for themselves and residents.

Out of concern for their privacy, some respondents hesitate to take part in door-to-door registration. On behalf of the national population census office, I would like to assure you that we will strengthen protection over residents' personal information throughout the census. Census offices at all levels and their staff are obliged to keep the obtained information private or bear the corresponding legal liability. Please feel secure about receiving phone calls and household visits. I hope the large program concerning 1.4 billion people can gain widespread support from the public. Thank you.

Shou Xiaoli:

A census taker has already visited the neighborhood where I live. Please continue. The floor is open for the last two questions. 

Reuters:

In terms of the retail sales of consumer goods, which sectors have experienced comparatively weak growth, and which have seen rapid growth? Is such growth sustainable? What is the situation in retail services in the third quarter? Thank you.

Liu Aihua:

Thank you for your questions. Based on the statistics for September, the retail sales of petroleum and related products saw comparatively slow recovery with the largest decline, followed by that of telecommunication equipment. These two categories of goods experienced negative growth. The decrease in retail sales of petroleum and related products can be mainly attributed to price factors, since the total retail sales of consumer goods are calculated using current prices. The retail sales of petroleum and related products in the first three quarters saw negative growth, down 16.7% year-on-year, which is a larger decrease than that in September. Therefore, the decline is currently slowing. The retail sales of telecommunication equipment in September declined by 4.6%, while the figure in the first three quarters increased by a total of 7.2%. As for the fluctuation this month, our preliminary estimates show that it is a short-term one as the total increase in the first three quarters is relatively high. The fluctuation is probably due to the fact that various companies launched cellphones onto the market in particular months, or because the period for releasing new products is different from last year, changing from September last year to October this year. It has something to do with these factors.

In general, the retail sales of these two categories declined in September; but the trend shows that they are also improving, and that the decline is narrowing. In general, the retail sales of enterprises (businesses) above the designated size in quite a few categories declined in the first three quarters. It is also worth noting that consumer demand is indeed recovering. In terms of monthly fluctuations, the total retail sales of consumer goods have maintained positive growth for two consecutive months, but the growth is relatively weak. The total retail sales of consumer goods in September increased by 3.3% year-on-year, which is still a low level of recovery. In total, retail sales in the first three quarters fell by 7.2% year-on-year, and this is a relatively big decline. Although recovering, the overall level is relatively low, and there remains work to be done to return to normal levels.

Going forward, we will adhere to the strategic focus of boosting domestic demand, and continue to work on aspects such as raising people's income and improving the consumption environment, so as to further promote the recovery of consumer demand. Thank you.

South China Morning Post：

I want to add a question about the outlook for economic growth. The International Monetary Fund (IMF) forecasts that China's economy will grow by 1.9% this year, while other market institutions predict growth of between 2.5% and 3%. I wonder if the National Bureau of Statistics has any forecast for the specific growth rate this year. Is it necessary to reach a level of around 3% to achieve the employment and livelihood targets set in the government work report, and to get close to the goal of doubling GDP set previously? Thank you.

Liu Aihua:

Thank you for your question. Your focus is still on the future economic trends. The IMF's latest growth forecast for China reflects the confidence of the outside world, especially international organizations, in China's economic growth. From the perspective of what I have just described, both the demand and production sides are in the process of recovery to varying degrees, which is reflected in the overall economy. Currently, the trend of a sustained and stable recovery of the economy as a whole is relatively clear. In the fourth quarter, in terms of the external environment of economic growth, there are still uncertainties about the development of the epidemic and its impact on the world economy and trade. Internally, the economy is still in the process of recovery. Most of the indicators have not yet returned to the normal levels, and some of the cumulative growth rates have also declined. Generally speaking, on the one hand, we have the foundation and conditions for the recovery, and the fundamentals for stable growth of the Chinese economy as a whole remain unchanged, but on the other hand, we should also recognize the uncertainties in the domestic and international environments. We must further abide by the decisions and arrangements made by the CPC Central Committee, make solid efforts to stabilize employment, finance, foreign trade, foreign investment, domestic investment, and market expectations. We must comprehensively safeguard residential employment, people's livelihoods, market entities, food and energy security, the stability of industrial and supply chains and operations at grassroots levels in order to fulfil the whole-year targets for economic and social development. Thank you.

Shou Xiaoli:

Thank you, Ms. Liu and our media friends. That's all for today's press conference. Goodbye.

Translated and edited by Chen Chao, Wang Qian, Zhang Rui, Zhang Liying, Zhu Bochen, Duan Yaying, Yuan Fang, Xiang Bin, Fan Junmei, Huang Shan, Gong Yingchun, Wu Jin, Xu Xiaoxuan, Wang Zhiyong, Zhou Jing, Zhang Junmian, Wang Yiming, Geoffrey Murray, David Ball, Laura Zheng, and Jay Birbeck. In case of any dispute over a perceived discrepancy, the Chinese version is deemed to prevail.

.

Read in Chinese

Speakers:

Maj. Gen. Luo Wei, director general of the Peacekeeping Affairs Center of the Ministry of National Defense

Senior Col. Ren Guoqiang, spokesperson of the Ministry of National Defense

Senior Col. Pan Qinghua, officer from the Bureau of Publicity of the Political Work Department of the Central Military Commission

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

Sept. 18, 2020

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). The SCIO today released a white paper entitled "China's Armed Forces: 30 Years of UN Peacekeeping Operation," and we are holding this press conference to introduce and explain some of the details. We are joined by Maj. Gen. Luo Wei, director general of the Peacekeeping Affairs Center of the Ministry of National Defense; Senior Col. Ren Guoqiang, spokesperson of the Ministry of National Defense; and Senior Col. Pan Qinghua, officer from the Bureau of Publicity of the Political Work Department of the Central Military Commission. I'm Hu Kaihong, spokesperson of the SCIO.

First, I will give you a brief introduction on the main content of the white paper.

Hu Kaihong:

This year marks the 75th anniversary of the founding of the United Nations (U.N.) and the fifth anniversary of President Xi Jinping's attendance at the U.N. Leaders' Summit on Peacekeeping. It is also the 30th year since China's armed forces first participated in the U.N. peacekeeping operations (UNPKOs). At this particular historic moment, the Chinese government decided to release a white paper entitled "China's Armed Forces: 30 Years of U.N. Peacekeeping Operations." As the first peacekeeping-themed white paper, it comprehensively reviews the journey and practice of China's armed force in UNPKO activities s over the past three decades, as well as the contributions made. It fully showcases key achievements as China's armed forces have implemented the pledges announced by President Xi Jinping during the U.N. Leaders' Summit on Peacekeeping. The white paper systematically explains the founding mission and propositions of China's armed forces in the UNPKOs. It elaborates on how China's armed forces have engaged in various operations for maintaining world peace, firmly contributing to building a community with a shared future for mankind. The full text of the white paper is about 14,000 Chinese characters. It consists of four parts including preface, main body, closing remarks, and annexes.

Hu Kaihong:

In the past three decades, China's armed forces have always aspired to fulfill their mission of meeting the responsibilities of a major country, safeguarding world peace, contributing to the building of a community with a shared future for mankind, and embarking on missions in this regard. As the white paper explained, China's armed forces participate in the UNPKOs, because the pursuit of peace is embedded deep in the genes of the Chinese nation; that the Chinese people care about the wellbeing of all humanity; that serving the people is the fundamental purpose of the people's armed forces; and that China honors its responsibilities as a major country. Throughout their participation in the UNPKOs, China's armed forces have always upheld the purposes and principles of the U.N. Charter; closely followed the basic principles of the UNPKOs, championing the vision of global governance based on extensive consultation, joint contribution and shared benefits; pursing common comprehensive, cooperative and sustainable security; staying committed to peaceful means in settling disputes; and building stronger peacekeeping partnerships.

Over the past 30 years, China's armed forces have become a critical force in the UNPKOs. The white paper shows how China's armed forces have undertaken diversified tasks and missions, including ceasefire supervision, stabilizing volatile situations, protecting civilians, providing force protection, deploying enabling capabilities, and sowing the seeds of hope. They have made a tremendous contribution to facilitating the peaceful settlement of disputes, safeguarding regional security and stability, and promoting economic and social development in host nations. They have stood firm as a disciplined force for peace and justice.

In the past five years, China's armed forces have fully implemented the pledges announced by President Xi Jinping during the U.N. Leaders' Summit on Peacekeeping. They have honored the commitments with real actions and tangible results and much important progress. The white paper notes that China's armed forces have expanded the composition of their peacekeeping troops from an initial single service into multiple military branches, enabling Chinese peacekeepers to perform diverse tasks in addition to enabling functions. The objectives of China's peacekeeping efforts have extended beyond conflict prevention to building lasting peace. As a result, the peacekeeping capacity of China's armed forces has been further strengthened.

Hu Kaihong:

World peace is the responsibility of all countries and peacekeeping calls for expanding multilateral cooperation. The white paper points out that China's armed forces has been actively working for greater international cooperation. They have cooperated in peacekeeping with over 90 countries and 10 international and regional organizations. They have enhanced mutual understanding, extended practical cooperation, strengthened bilateral and multilateral relations, and continuously promoted peacekeeping capability.

The world is going through profound changes unseen in a century, and there are diverse threats to world peace. The white paper notes that looking back through history, people are more keenly aware that peace has not come easily and to safeguard it requires great efforts. It stresses that, no matter how the international landscape may evolve, China will always strive to maintain world peace, promote global growth, and uphold international order. China's armed forces will always be a force of justice for world peace and development.

The white paper "China's Armed Forces: 30 Years of U.N. Peacekeeping Operation" is published in eight languages – Chinese, English, French, Russian, German, Spanish, Arabic and Japanese. It is published respectively by People's Publishing House and Foreign Languages Press; and is available in Xinhua Bookstores across China. 

That's all for the introduction. Next, let's give the floor to Ren Guoqiang, spokesperson of the Ministry of National Defense.

Ren Guoqiang:

Friends from the media, good morning. Today we officially publish the white paper – China's Armed Forces: 30 Years of UN Peacekeeping Operations. Just as Director Hu has said, this is the first thematic white paper issued by the Chinese government on our armed forces' participation in United Nations peacekeeping operations (UNPKOs). We all know this year marks the 75th anniversary of victory in the Chinese People's War of Resistance Against Japanese Aggression and the World Anti-Fascist War, as well as the 75th anniversary of the founding of the United Nations and the 30th year since China's armed forces first participated in UN peacekeeping operations. It also marks the fifth anniversary of President Xi Jinping's attendance at the Leaders' Summit on Peacekeeping at U.N. headquarters (UNHQ). We are releasing the white paper at this critical moment mainly to review the glorious journey of involvement by China's armed forces in the UNPKOs, to expound our ideas, policies and practices regarding safeguarding of world peace in the new era, to present the new actions being undertaken, new responsibilities assumed and new contributions made since President Xi's attendance at the summit, and to reveal a vision for future participation in UNPKOs, and to call on the international community to work together to safeguard world peace and build a community with a shared future for mankind. 

This white paper comprises of 14,000 Chinese characters in four parts – the preface, the main body, the closing remarks and annexes. The main body is made up of five chapters:

The first is "Embarking on Missions for World Peace." This chapter mainly introduces the original aspirations and the mission of China's armed forces taking part in UNPKOs, and expounds the policies and ideas they have upheld through the process of safeguarding world peace. This chapter also raises issues such as upholding the purposes and principles of the U.N. Charter and following the basic principles of the UNPKOs, emphasizing a vision of global governance and new concepts of security issues, advocating peaceful means in settling disputes and cementing peacekeeping partnerships. 

The second is "A Key Force in UNPKOs." This chapter introduces the important practices of China's armed forces while participating in UNPKOs, shows the diversified tasks they have undertaken, reflects on their achievements and contributions from different angles through data and examples, and tells touching stories of Chinese military peacekeepers. 

The third is "Implementation of the Pledges Announced at the U.N. Summit." This chapter presents the progress that has been achieved in the past five years in the thorough implementation of the pledges made by President Xi Jinping at the Leaders' Summit on Peacekeeping at UNHQ, so as to show that, as a responsible major country, China has taken on international responsibilities through the new actions taken, new responsibilities assumed and new contributions made by China during the process of participating in UNPKOs.  

The fourth is "Active Efforts for Greater International Cooperation." This chapter states that China's armed forces have been upholding the principles of reciprocity, mutual trust, and cooperation for win-win results and have proactively carried out exchanges and cooperation with the international community in close strategic communications, the sharing of experiences and building on developing greater capabilities. It shows the global image of China's armed forces which is open and confident, and demonstrates the efforts they have made and the sincerity they have entertained in jointly improving international peacekeeping capabilities and in contributing Chinese wisdom. 

The fifth is "Contributing to Building a Community with a Shared Future for Mankind." This chapter introduces the future vision and initiative of China's armed forces in participating in UNPKOs, highlights how they are contributing to building a community with a shared future for mankind, and lets the international community see that they will actively participate in UNPKOs as usual to make new and more important contributions to safeguarding world peace. 

Next, my colleagues and I will answer your questions.

Hu Kaihong:

Now you may ask questions. Please state the news outlet you represent first.

CCTV:

We have noticed that many concepts contained in this white paper haven't been seen in previous news coverages regarding Chinese military peacekeepers' operations, such as the original aspirations and the mission of China's armed forces in participating in UNPKOs and the types of tasks the Chinese military peacekeepers have undertaken. Could you give us a comprehensive introduction of the main features of the peacekeeping-themed white paper? Thank you.

Luo Wei:

With the title of China's Armed Forces: 30 Years of UN Peacekeeping Operations, the first thematic white paper on the participation of China's armed forces in UNPKOs takes an overall view of the glorious journey of China's armed forces in the UNPKOs over the past 30 years and expounds on their ideas and practices of safeguarding world peace in the new era, with a strong approach that is systematic, authoritative and innovative. I think the main features of white paper can be categorized into "five firsts":

First, the white paper, for the first time, clarifies the original aspirations and the mission of China's armed forces' participating in UNPKOs. It clearly states that the nature, the original aspirations and the mission of China's armed forces to participate in UNPKOs was to meet our responsibilities as a major country to safeguard world peace, and contribute to the building of a community with a shared future for mankind. The formation of the original aspirations and mission evolved from the pursuit for peace in the genes of the Chinese nation, that the Chinese people care about the wellbeing of humanity, that serving the people has always been the fundamental purpose of the people's armed forces, and that China honors its responsibilities as a major country. 

Second, the white paper, for the first time, offers a structure for the system of policies regarding China's armed forces' participation in UNPKOs, which can be summarized into "six insistences", namely, insisting on the purposes and principles of the U.N. Charter, insisting on closely following the basic principles of the UNPKOs, insisting on the vision of global governance based on extensive consultation, joint contribution and shared benefits, insisting on the pursuit of common, comprehensive, cooperative and sustainable security, insisting on peaceful means in settling disputes, and insisting on building stronger peacekeeping partnerships.

Third, the white paper, for the first time, explores the main tasks undertaken by China's armed forces in UNPKOs. It systematically analyzes all sorts of peacekeeping tasks undertaken by China's armed forces in UNPKOs over the past 30 years, and divides them into six main types - ceasefire supervision, stabilizing volatile situations, protecting civilians, providing force protection, deploying enabling capabilities, and sowing the seeds of hope. Among the six, the last on sowing the seeds of hope contains distinctive Chinese characteristics. 

Fourth, the white paper, for the first time, introduces the full implementation undertaken in the past five years of the pledges made by President Xi Jinping at the Leaders' Summit on Peacekeeping at UNHQ in 2015. There, he announced six measures that China would take to support U.N. peacekeeping. Over past five years, the Chinese government and armed forces have faithfully implemented the decisions and directions of President Xi Jinping, and taken concrete steps to honor the promises. We have set up a U.N. peacekeeping standby force of 8,000 personnel, deployed more enabling troops to participate in UNPKOs, trained large amounts of peacekeepers for foreign countries, offered free military aid to the African Union, deployed a first peacekeeping helicopter unit, and established a China-U.N. Peace and Development Fund to support peacekeeping efforts. All of these represent the new actions taken and new contributions made by China's armed forces in support of UNPKOs in the new era.

Fifth, the white paper, for the first time, presents the vision and initiative of China's armed forces in participating in UNPKOs. The world is going through profound changes unseen in a century, and the COVID-19 pandemic is accelerating such changes. The white paper calls for the international community to uphold the vision of a community with a shared future for mankind, proposing Chinese ideas and Chinese solutions for strengthening and improving UNPKOs on six aspects. 

China News Service:

We learn from the white paper that the Chinese armed forces completed the registration of an 8,000-strong peacekeeping standby force at the U.N. in 2017. There were comments then saying this was an attempt to present a more positive international image. Could you introduce the force's development at present? And how does China plan to use this force? Thank you. 

Luo Wei:

When attending the U.N. peacekeeping summit in 2015, President Xi Jinping made a solemn pledge that China would assemble a standby force of 8,000 peacekeepers. The Chinese government and the military have resolutely implemented President Xi's decisions and plans and set high standards in planning and implementation. Based on an in-depth review of the achievements and experiences drawn from previous participation in U.N. peacekeeping operations, we enhanced communications and coordination with the U.N., scientifically planned the types and numbers of the members of China's peacekeeping standby force, and strived to develop it as suitable for U.N. peacekeeping operations. In September 2017, registration was completed with the U.N. of the standby force of 8,000 peacekeepers, which has a total of 28 units in ten categories and then conducted targeted training in accordance with the requirements and conditions required. In October 2018, 13 of these units were elevated to PCRS Level 2 after passing an assessment approved by the U.N. Later, six units were upgraded to PCRS Level 3 from Level 2 successively. Since the Chinese peacekeeping standby force was assembled, it has always taken peacekeeping capacity building as a priority in its training and development, including the study of the theories, laws and regulations of U.N. peacekeeping operations as well as improvement of professional operational capacity, emergency response and international communications capacity.

We are confident that the Chinese peacekeeping standby force will respond to the U.N. needs at any time and become a reliable, well-equipped, well-trained and disciplined professional force for U.N. peacekeeping operations. Thank you.

Global Times:

The West has been accusing China of using its participation in peacekeeping operations to expand its military strength. As mentioned in the white paper, China will continue to increase its support and participation in U.N. peacekeeping operations. Does it mean that China will send more forces to carry out overseas missions? Do you have any plan for participating in combat missions? Besides, I'd like to take this opportunity to ask a question on a hot issue. The U.S. and Taiwan recently have had frequent interactions, including U.S. Under Secretary of State Keith Krach's visit to Taiwan yesterday. What is your comment? What is the response of the PLA? Thank you.

Ren Guoqiang:

With regard to your first question, the People's Republic of China has steadfastly followed a road of peaceful development and resolutely safeguarded its sovereignty and security as well as promoted world peace and stability since its founding more than 70 years ago. In the face of the once-in-a-century transformations unfolding in our world, China's great journey of development over some 70 years, together with the participation of the Chinese army in U.N. peacekeeping operations for 30 years, fully demonstrates that China has all along played its part in promoting world peace and development and upholding the international order. Entering the new era, the Chinese military is actively striving to promote the building of a community with a shared future for mankind, and is willing to provide strategic support for world peace and development.

First, we will continue to fully fulfill the important pledges made by President Xi Jinping at the U.N. peacekeeping summit in 2015 to dispatch more peacekeepers to U.N. operations and provide personnel and equipment within our capacity to support U.N. and regional organizations in their peacekeeping missions.

Second, we will continue to actively participate in U.N. peacekeeping operations, support reasonable and necessary reform of U.N. peacekeeping operations, actively respond to the Action for Peacekeeping initiative, improve the efficiency of peacekeeping operations and better play the role of U.N. peacekeeping operations.

Third, we will continue to enhance international cooperation in peacekeeping. U.N. peacekeeping operations in themselves are a model and outcome of international cooperation. We will further conduct peacekeeping exchanges and cooperation with international and regional organizations and countries and peoples committed to the cause of world peace based on the principles of mutual trust, mutual benefit and win-win cooperation. We will enhance mutual understanding, exchange experiences and practices and strengthen practical cooperation to jointly promote the sound and sustainable development of U.N. peacekeeping operations through visits of delegations, exchanges of experts, joint exercises and training, and personnel training.

As for your second question, I would like to respond by saying the PLA's Eastern Theater Command conducts a real-combat exercise near the Taiwan Strait starting from today, a legitimate and necessary move aimed at coping with the current situation in the Taiwan Strait to safeguard national sovereignty and territorial integrity. Taiwan is an inalienable part of the Chinese territory. The Taiwan question is purely China's internal affair and allows no outside interference. The United States and the Democratic Progressive Party authority in Taiwan have recently intensified their collusion, often creating trouble. Trying to use Taiwan to contain China or relying on foreign strength to build itself up is wishful thinking and doomed to fail. Those who play with fire will get burnt. The PLA has the firm will, abundant confidence, and enough capabilities to thwart any interference by foreign forces or "Taiwan independence" activities and resolutely safeguard national sovereignty and territorial integrity.

Asahi Shimbun:

What is the impact of the COVID-19 pandemic on China's U.N. peacekeeping operations? Has anyone been infected among the overseas force? Thank you.

Luo Wei: 

Since the outbreak of COVID-19, President Xi Jinping and the leadership of the Central Military Commission have attached great importance to the prevention and control of the epidemic among military staff carrying out overseas missions. In this regard, we have adopted four main measures as follows:

First, we established an epidemic response mechanism. We have maintained close communication and coordination with the U.N. and peacekeeping missions and set up an emergency response mechanism for reporting cases among overseas peacekeeping forces, and kept close track of the epidemic prevention and control and staff health in the host countries and areas for missions.

Second, we have conducted stricter staff control. We have strengthened the self-protection awareness and ability of overseas peacekeeping forces to conduct strict individual protection and organized epidemic prevention and control drills. We have undertaken strict review of personnel into and out of the camps by setting up temperature checkpoints at the camp entrance. We have special places to receive visitors from outside, and have strictly controlled gathering activities.

Third, we have enhanced the raising of materials and medical treatment. In accordance with the needs of epidemic prevention and control and carrying out missions, we have organized materials, equipment and related drugs, purchasing masks, protective suits, and disinfectants. We have standardized the procedures for receiving patients during the epidemic, required medical staff to carefully protect themselves from the epidemic and strengthened remote medical assistance.

Fourth, we have conducted strict quarantine before dispatching peacekeepers or after their return. Prior to the dispatch of peacekeepers, we strictly implement the requirements of a 15-day quarantine for medical observation, strengthen professional training in epidemic prevention and control, equip them with personal protective gear and necessary epidemic prevention equipment, carry out nucleic acid testing for all of them and conduct disinfection and protection treatment for materials transported by sea and air. All the peacekeepers have been strictly quarantined upon their return to China. All Chinese peacekeepers overseas are in good health. Thank you.

China Daily:

A certain foreign research institute said China's peacekeeping troops were the most professional, well-trained, and most disciplined force. At the same time, we noticed that a recent TV documentary entitled "In the Course of Peace" focused on peacekeeping troops. How are China's peacekeeping troops trained? What is the secret behind their success? Thank you.

Pan Qinghua:

The Chinese army has an open secret, which is the political work. This is the major source of the professional ability of Chinese troops, and also the biggest feature and greatest superiority they possess. No matter what tasks Chinese troops are asked to perform and in whatever environment, the political work will always help them strengthen their ideals and beliefs and be united with strong morale, implementing strict discipline; it enables us to cultivate soldiers to fight against hardship and face death bravely. All this provides a strong ideological and political guarantee for the troops to effectively fulfill their missions.

China's peacekeeping troops have creatively carried out political work by facing the harshest environments, heaviest tasks, security threats, life or death situations in participating UNPKO. We have guided soldiers to safeguard the purposes and principles of the U.N. Charter, strictly implement U.N. guidelines and disciplinary requirements, strictly abide by the laws and regulations of the host country, respect the ethnic, religious and cultural norms of the people in the host country, and provide public services including protection, medical rescue, road and bridge construction, transportation support, agricultural planting, and improvement of living standards. For example, the Chinese medical team sent to the Democratic Republic of the Congo teamed up with SOS Children's Village in the city of Bukavu to help children receive a proper education and ability to cope with life's challenges. Meanwhile, Chinese female soldiers were called "Chinese mothers" by the children for care shown. The action of love has been going on for 17 years, wining a great reputation among local people.

Over the past 30 years, Chinese troops have participated in 25 UNPKOs involving more than 40,000 personnel to perform various activities. There is no war in China, but Chinese soldiers have sacrificed their lives on occasions for a wider cause. So far, 16 Chinese soldiers have sacrificed their lives for the cause of peace. Their names are recorded in the white paper on page 39, forming a historical monument. China commemorated and paid tribute to the heroes in a solemn way. No matter which country they are in, no matter how complicated and difficult the mission they are undertaking, China's peacekeeping troops have always performed their duties and lived up to the trust placed in them. They have always maintained a good ideological and political performance, good work style, good discipline requirements, and good mental state. One of our peacekeepers wrote in his diary: "If someone asks us why we travel so far and undertake peacekeeping work in such a dangerous place, please tell him, because we want to maintain the bottom line of human civilization."

China's peacekeeping troops is working for peace and justice. In the past 30 years, groups of Chinese peacekeepers have marched forward bravely and forged ahead for world peace, and accomplished their mission in the risky peacekeeping battlefield. The lifeline of political work is fully demonstrated in the front line of peacekeeping. Thank you.

Xinhua News Agency:

At the U.N. commemorative ceremony of the International Day of UN Peacekeepers held on May 29 this year, a female Chinese military officer received the honorary certificate of the U.N. Military Gender Advocate Award. As we know, China dispatched a large number of female medical workers as part of its peacekeeping medical team, and there is a female infantry squad in the South Sudan peacekeeping infantry battalion. Please introduce some details about the female Chinese peacekeepers. Thank you.

Luo Wei:

There are many female journalists participating in this press conference today, and I would like to answer the question. A writer in the former Soviet Union wrote a documentary book called The Unwomanly Face of War, mainly about Soviet women in World War II. In China, we all know that, in ancient times, Hua Mulan joined the army in place of her aged father, and today there are female peacekeepers working for the people. These stories are well-known to the public. Today, all the positions in the UNPKOs, female soldiers are also playing unique and important role in promoting gender equality and protecting women's rights, and even in preventing and managing conflicts and promoting peaceful development. 

China firmly supports the Women, Peace and Security Agenda of the United Nations and implements the UNSC Resolution 1325 on women, peace and security by action. Over the past 30 years, the Chinese military has sent more than 1,000 female officers and soldiers to participate in UNPKO. Currently, we have 85 female soldiers performing peacekeeping tasks at the U.N. headquarters and multiple missions, mainly participating in medical support, liaison and coordination, mine sweeping and explosive ordnance disposal, patrol and observation, promotion of gender equality and protection of women and children.

This journalist mentioned the deeds that led to the award of a certificate of honor by the United Nations. I will give you a brief introduction. The female soldier who was awarded the honorary certificate is Major Xin Yuan. She was assigned to the United Nations Interim Force in Lebanon (UNIFIL) last October as a senior mine clearance staff officer of the Combat Engineering Office and is also the only female officer to be in charge of mine sweeping. Her main job is to undertake mine sweeping planning, supervising and managing troops' mine sweeping operations. After arriving in the mission area, the first task she received was to organize and implement a humanitarian mine sweeping mission. In order to complete this task with a high standard, Xin took risks in going into the minefield with a mine-sweeping squad. She acquired first-hand information and formulated a thorough plan, which was completed 34 days in advance and swept more than 1,500 square meters of minefields. Her work has also received special awards from UNIFIL. This year, on the International Day of UN Peacekeepers on May 29, she received the honorary certificate of the United Nations Military Gender Advocate Award. Xin is a young female soldier born in the 1990s, and is also the mother of a two-year-old child. As far as I'm concerned, her deeds vividly showed the spirit of brave and dedication of contemporary Chinese female peacekeepers.

Shenzhen Satellite TV:

Some people believe that, since the launch of the UN peacekeeping operations (UNPKOs), the world is far from being peaceful. Conflicts and wars still exist in many regions. They believe that the peacekeeping operations have failed to fully play their desired role. What's your comment on this?

Ren Guoqiang:

A few days ago, the Ministry of Foreign Affairs (MFA) issued the Position Paper of the People's Republic of China on the 75th Anniversary of the United Nations, which clearly pointed out that the UN has always taken peace as its mission over that past 75 years. The practice of the UN peacekeeping operations over the past seven decades shows that, despite some insufficiencies, it still plays an instrumental role in preventing new world wars, mitigating regional conflicts, alleviating humanitarian disasters, and promoting world peaceful development. In response to the challenges and difficulties faced by the UN peacekeeping operations, we believe that countries should continue to uphold the purposes and principles of the UN Charter, work to build a new type of international relationship structure featuring mutual respect, equity, fairness, justice and win-win cooperation, further strengthening the central role of the UN in peacekeeping operations, and fully leverage the role of peacekeeping operations in safeguarding international peace and security. All members of the international community should join hands to build a community with a shared future for mankind. Thanks. 

Thecover.cn:

It is noted that complex and profound changes have occurred in the international landscape. The same is true for UN peacekeeping operations. Given that, how does the White Paper assess the current international peacekeeping situation? Thanks.

Luo Wei:

About the situation of peacekeeping operations across the world, we didn't dedicate a specific chapter to discussion of it. However, we do believe that the world is going through profound changes not seen in a century, and the COVID-19 pandemic is impacting on and accelerating such changes. Uncertainties and destabilizing factors in the international security situation are on the rise, and there are diverse threats to world peace. The UN peacekeeping operations are faced with multiple challenges, including increasing constraints, heavier tasks and a more complex security environment. China will continue to play its part as a permanent member of the UN Security Council, firmly support and participate in peacekeeping operations, actively respond to the Action for Peacekeeping (A4P) initiative, and support reasonable and necessary reforms in the UNPKOs. China will contribute its fair share to building an open, inclusive, clean, and beautiful world that enjoys lasting peace, universal security and common prosperity.

Hong Kong Economic Herald:

There are opinions that participation of Chinese peacekeeping troops in UN efforts presents a window for the world to gain better understanding of China's armed forces, maybe in many different ways. So, what does the rest of the world see through the window? Thanks. 

Pan Qinghua:

As the world is moving toward multi-polarity, China's armed forces have been taking a more active part in shouldering responsibilities and playing an increasingly important role in international affairs. 

Over the past three decades, China's armed forces have continuously in upholding ideas such as "harmony without uniformity" and "harmony for common development" and committed to spreading the policies and decisions, and achievements and contributions of UN peacekeeping operations. We actively support and work towards creating a good neighborly environment for UN peacekeeping operations. In February, 2019, the Political Work Department of Central Military Commission (CMC) held a themed exhibition at UN headquarters to showcase Chinese armed forces' contributions in safeguarding world peace, which were lauded by UN officials and diplomats. Atul Khare, UN under-secretary-general, said China was a major force supporting peacekeeping operations and promotion multilateralism. Carlos Humberto Loitey, UN military adviser from the Department of Peacekeeping Operations, said China's contribution to peacekeeping operations should be well valued. Without China's support, there would not have been able to achieve the level peacekeeping operations have achieved.

For a long time, China's armed forces have taken part in ceasefire supervision, stabilizing the situation, protecting civilians, providing force protection, supporting various peacekeeping operations. We have demonstrated our willingness to promote international cooperation on peacekeeping operations and worked hard to build a community with a shared future for all humanity. We pass on hope and love, and safeguard peace. Our actions have been highly commended by the UN and people of the host countries. A Kenyan military officer once said that, during difficult times, China's armed forces not only bring security but also kindness. People in Lebanon gave Chinese peacekeeping troops a lovely name "the most admirable friend from the east". A UN official said he was able to discover the most precious virtues of the Chinese nation from the Chinese peacekeeping troops, which are the kindness and ingenuity. He also expressed his appreciation for China's efforts to make our world a better place.

Time will tell. Our actions over the past 30 years have presented to the world that the Chinese military is a force for safeguarding security and respecting for the lives. And through contributions and dedications, we demonstrated to the international community our loyalty and strength and will always preserve our nature, purpose and character as the undefeated forces of the people from a major responsible country. Thanks.

China Review News:

The White Paper mentioned several times that Chinese peacekeeping troops have made important contributions to safeguard the regional peace and security. We know that UN peacekeeping operations is an important part of the international collective security. My question is that what kind of role that Chinese peacekeeping troops play in the UN peacekeeping mechanism? And what are their contributions? Thanks. 

Luo Wei:

It has been 30 years since China began to take part in the UN peacekeeping operations. Over the past three decades, we have stepped up fulfillment of our responsibilities as a major country and taken concrete actions to honor our promise to safeguard world peace. Chinese military peacekeepers have made a tremendous contribution to facilitating the peaceful settlement of disputes, safeguarding regional security and stability, and promoting economic and social development in host nations.

Here I would like to share with you some figures. Over the past 30 years, China's armed forces have contributed more than 40,000 service members to 25 separate UN peacekeeping missions. Sixteen Chinese military peacekeepers have sacrificed their lives for the noble cause of peace. China's armed forces have cooperated in peacekeeping with over 90 countries and 10 international and regional organizations. In 2015, President Xi Jinping attended the UN Peacekeeping Summit and made a six-point commitment to support peacekeeping operations. Over the past five years, a peacekeeping standby force of 8,000 troops has been generated. Twenty-five enabler troops totaling over 7,000 individuals have been committed to missions. China has provided training programs to over 2,800 peacekeepers from more than 60 countries, including more than 1,000 peacekeeping police officers and more than 300 professionals for mine sweeping. The PLA helicopter unit, with four helicopters, made its first flight on a peacekeeping mission. The PLA has honored China's commitment of free military aid to the value of $100 million to support the African Union. China has established a China-UN Peace and Development Fund. The fund has financed 23 projects to support peacekeeping operations, which cost more than $10 million. As of now, 2,521 Chinese military peacekeepers have been serving on eight UN peacekeeping missions and at UN headquarter.

In addition, China is the second largest contributor to UN peacekeeping operations, and the largest troop-contributing country among the permanent members of the UN Security Council. I believe that all these figures fully demonstrated that, in the past 30 years, especially in the recent five years, China has made great contribution. Thanks.

Beijing Daily:

The White Paper points out that "to contribute to building a community with a shared future for mankind, China's armed forces have stepped up their support for and participation in the UNPKOs". In the fifth chapter, it is stated that, "to participate in the UNPKOs is integral to China's joint efforts with other countries to build a community with a shared future for mankind." How should we interpret these words?

Ren Guoqiang:

In today's world, we have increasingly become a community with a shared future of intertwined interests, shared security and prosperity. Peace has been people's most enduring aspirations. Only by achieving peace is it possible to guarantee progress and development, bring prosperity to all. History, with its periods of peace and war, tells us that peace needs to be fought for and safeguarded, and that comes from cooperation. UN Peacekeeping, as an instrument developed for peace, is an important means to safeguard world peace and security .

China's armed forces are always a key force for safeguarding world peace and building a community with a shared future for mankind. Over the past 30 years, China's armed forces have resolutely delivered on the purposes and principles of the UN Charter, faithfully performing their duties, and making a significant contribution to world peace and stability. In the new era, the world is going through profound changes unseen in almost a century, and the COVID-19 pandemic is accelerating such changes. China's armed forces actively contribute to building a community with a shared future for mankind , resolutely uphold the UN Charter and basic principles of the UNPKOs, firmly support the core role of the UN in peacekeeping operations, and promote sound and sustainable reforms of UN peacekeeping. China's armed forces will remain as a steadfast force safeguarding world peace. Thank you.

DZwww.com:

The white paper states that China's armed forces have cooperated on peacekeeping with a number of countries and international and regional organizations. The UNPKOs are led by the UN, and Chinese peacekeeping troops are just one of the participants. So, why do we need to exchange and cooperate with other countries? Thank you.

Ren Guoqiang:

As I just mentioned, the UNPKOs are a successful example and product of international military and security cooperation. China's armed forces believe that advancing cooperation in regard to peacekeeping is beneficial to mutual understanding, strengthened bilateral and multilateral relations, as well as sound and sustainable development of the UNPKO mission. Therefore, Chinese peacekeeping troops will continue to uphold the principles of mutual trust and prosperity through win-win cooperation, and further promote international communications and cooperation in regard to peacekeeping. We will: first, continue to strengthen communication with the UN and support reforms of its peacekeeping operations; second, actively boost communication through the exchange of visits, share experiences and practical cooperation with other troop-contributing countries; third, organize joint peacekeeping exercises and training, including table-top and real exercises, so as to enhance the coordination capacity of peacekeeping forces of participating countries.

In a word, China's armed forces will continue to support the UN in upgrading its peacekeeping training level, exchange experiences with other troop-contributing countries, hold peacekeeping training courses on a regular basis, and enhance the peacekeeping capacity of the international community. Thank you.

Hu Kaihong:

The last question, please.

Red Star News:

We have noted that there is a provision entitled "sowing the seeds of hope" encompassed in the chapter on "A Key Force in UNPKOs", which reads so different from the rest of the parts on mission. Would you please tell us what prompted you to say this? Thank you. 

Luo Wei:

As you pointed out, and the rest of you may take note of it, there is a special section named "Sowing the seeds of hope" in the second chapter focusing on the mission concept held by China's peacekeeping troops. We added this part to identify the distinctiveness of our own contribution to the mission. Under the UN's general framework of peacekeeping operations, China's peacekeeping troops have strengthened coordination and cooperation with various international organizations and humanitarian agencies, and have actively facilitated post-conflict reconstruction, livelihood improvement and social development in host nations. We have played an active role in providing humanitarian assistance, and public services in infrastructure construction, medical care, health education, gender equality promotion, environmental awareness promotion, vocational training.

During UN peacekeeping missions, Chinese peacekeeping troops provide public services and "sow the seeds of hope", which was determined by their original aspiration. It embodies the concept that serving the people wholeheartedly is the fundamental purpose of the people's armed forces, and loving and helping the people is their fine tradition. For example, Sudan's Darfur is one of the regions in the world's facing the most severe water shortage, which is a main cause of many armed conflicts. Since arriving in the mission area in 2007, besides fulfilling its commitments to the UN, Chinese peacekeeping troops made every effort to find water and drill wells for local villages to alleviate drinking water difficulties for people and livestock. From 2007 to 2013, the Chinese military has sent seven batches of specialized water supply forces to the region and Chinese military engineers drilled 14 wells, effectively alleviating the problem of water scarcity for the locals. Such efforts have been acclaimed by local people. There are numerous examples like this. Over the past 30 years, Chinese peacekeeping troops have safeguarded peace with their perseverance and sowed the seeds of hope with their love, leaving touching stories one after another in host nations. Thank you.

Pan Qinghua:

I would like to add something. As one of our peacekeepers who sacrificed their lives during their missions once said, the highest value of a soldier is not only winning a war, but also preventing a war, and seeking great harmony for the whole world. Wining a war asks for strength, but wining peace calls for greater strength, as well as goodwill toward the world, love and responsibility. Love can light hope. I think this is why we introduce "Sowing the seeds of hope" in the second chapter. Thank you.

Hu Kaihong:

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

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Read in Chinese

Speakers:

Yang Xiaowei, vice minister of the Cyberspace Administration of China;

Zhao Long, member of the Standing Committee of the CPC Fujian Provincial Committee, vice governor of Fujian province;

You Mengjun, deputy secretary of the CPC Fuzhou Municipal Committee, mayor of Fuzhou Municipal People's Government;

Shen Zhulin, deputy director general of the Department of High-Tech Industry of the National Development and Reform Commission (NDRC);

Xie Shaofeng, spokesperson for the Ministry of Industry and Information Technology (MIIT), director of MIIT's Department of Information Technology Development.

Chairperson:

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office.

Date:

Sept. 17, 2020

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). The 3rd Digital China Summit will take place in October in Fuzhou, the capital of east China's Fujian province. Today, we are delighted to be joined by Mr. Yang Xiaowei, vice minister of the Cyberspace Administration of China; Mr. Zhao Long, member of the Standing Committee of the CPC Fujian Provincial Committee and vice governor of Fujian province; Mr. You Mengjun, deputy secretary of the CPC Fuzhou Municipal Committee and mayor of Fuzhou Municipal People's Government; Mr. Shen Zhulin, deputy director general of the Department of High-Tech Industry of the National Development and Reform Commission (NDRC); and Mr. Xie Shaofeng, spokesperson for the Ministry of Industry and Information Technology (MIIT) and director of MIIT's Department of Information Technology Development. They will brief you on issues regarding this year's summit and answer your questions.

Yang Xiaowei:

Ladies and gentlemen, friends from the media, good afternoon. First, I would like to thank you for your interest in the 3rd Digital China Summit. The previous two summits have played a significant leading role in promoting both the application of information technology in China and the development of a "digital Fujian."

The sudden outbreak of the COVID-19 pandemic at the beginning of 2020 has brought unprecedented disruption to economic and social development. Due to its impact, the 3rd Digital China Summit, which was originally slated to open in April, was unable to be held as scheduled.

At present, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core and with the joint efforts of people across the nation, China has taken a major step forward in its nationwide virus control efforts. The economy is developing in a steady manner, and the normal order in work and daily life has been fully restored. With the approval of the CPC Central Committee, the 3rd Digital China Summit will be held in the city of Fuzhou from Oct. 12 to 14. This year's summit is co-organized by the Cyberspace Administration of China (CAC), NDRC, MIIT, and People's Government of Fujian Province; and will be hosted by the Fuzhou Municipal People's Government and relevant institutions. General Secretary Xi Jinping made important instructions on developing a "digital Fujian" back on Oct. 12, 2000 when he worked in the province. This October marks the 20th anniversary of the province's digital agenda, and the summit's opening ceremony will take place on Oct. 12, the same day the instruction was made 20 years ago.

General Secretary Xi Jinping recently chaired a symposium on economic and social work, and made the significant assessment that China's development is entering a new stage. He stressed establishing a new development pattern which takes the domestic market as the mainstay, while allowing domestic and foreign markets to boost each other. Currently, China has taken a major step forward in its nationwide virus control efforts, and has made significant progress in coordinating prevention measures with economic and social development. The year 2020 marks the successful conclusion of both the 13th Five-Year Plan and the dawn of the 14th Five-Year Plan. This year's Digital China Summit will thus further boost all sectors' creativity and their active participation in building a "digital China," and is of crucial importance in unleashing the potential of the nation's digital development.

The theme of the 3rd Digital China Summit is "digital transformation driven by innovation; high-quality development led via intelligence." The summit aims to act as a platform which releases national policies on information technology; showcases the latest achievements of "digital China"; boosts communication regarding theories, experiences and practices of e-government and digital economy; and promotes global cooperation to build a "digital China" and "digital Silk Road." The summit, to be held both online and offline, will consist of seven sessions: opening ceremony, main forum, sub-forums, exhibition, innovation contest, launch event for application scenarios, and closing ceremony. In the meantime, a series of events commemorating 20 years of digital development in Fujian will also be held to review the digital progress in the province and look ahead to the country's digital agenda.

The 3rd Digital China Summit will commence in less than a month, with preparations for the event progressing steadily. The organizing committee will strictly observe the central Party leadership's eight-point decision on improving work conduct, implement regular prevention and control measures, and ensure the summit is economic, efficient and safe. People from all sectors are very much welcome to participate. Let's look forward to the successful convening of the 3rd Digital China Summit. Thank you.

Shou Xiaoli:

Next, let's give the floor to Mr. Zhao Long.

Zhao Long:

Friends from the press, ladies and gentlemen, good afternoon.

I am very pleased to brief you about the preparations for the 3rd Digital China Summit. First of all, on behalf of the CPC Fujian Provincial Committee and the Fujian provincial government, I sincerely extend my invitation to you all to visit Fujian province and Fuzhou city, and experience the vitality and infinite charm brought by digital China.

Twenty years ago, when General Secretary Xi Jinping worked in Fujian, he established a major strategic and forward-looking plan for the construction of digital Fujian, which was the prelude to the construction of digital China. In the past two decades, we have seen the development of digital Fujian and digital China; and China, as one of the world's key players in cyberspace, has set out a national strategy for cyber development. Under the guidance of General Secretary Xi Jinping's important thoughts on cyber development, we have fostered new growth drivers based on information technologies, which in turn promote new development and create new glory. The construction of digital China is now showing great vitality. At this historic moment, it is of great significance to hold the 3rd Digital China Summit. Under the careful guidance of the relevant ministries and commissions such as the Cyberspace Administration of China, the National Development and Reform Commission, and the Ministry of Industry and Information Technology, we will go all out to do our best in preparing for the summit and strive to come out with new features, new results, and new influences.

First, we will highlight high-tech and smart conferences. In line with the development trends of pandemic prevention and control as well as digital exhibitions, the summit will set up a "cloud summit" platform to broadcast the grand scenes of the summit simultaneously online and offline. As for the achievement exhibition, we will simultaneously launch a "cloud exhibition" to fully demonstrate the latest achievements in the construction of digital China through cloud computing, virtual reality (VR), artificial intelligence (AI), and other methods. We will use new technologies such as touch-free face recognition and digital identity authentication to further improve our conference services. Smart application scenarios including full 5G coverage, subway facial recognition, and smart parking lots will be unveiled during the summit, allowing guests to experience the limitless capabilities of digital empowerment.

Second, we will hold colorful activities. We will arrange a series of exciting and fascinating activities at the 3rd Digital China Summit, focusing on the development and application of digital technologies such as AI, big data, cloud computing, and blockchain. The NDRC will also release hundreds of application scenarios for the digital economy and launch the digital transformation partnership action among the second batch of enterprises. Meanwhile, the National Health Commission will host a special exhibition on the "Application of Digital Technologies for Epidemic Prevention and Control," displaying the achievements of how digital technologies can be applied to coordinate the advancement of epidemic prevention and control as well as economic and social development, and showing the great anti-epidemic spirit. Leading enterprises in the industry such as Huawei, Alibaba, and Tencent will hold special ecological exhibitions to showcase their latest scientific and technological achievements, and 50% of their new products at the summit will be unveiled for the first time. The summit will host a main forum with the theme of "innovation drives digital transformation, intelligence leads high-quality development" as well as 12 sub-forums that span topics such as e-government, digital economy, blockchain and financial technologies, and digital ecology. A group of heavyweight guests will deliver visionary speeches, looking forward together to a bright future for China's cyber development, a digital China, and a smart society. The summit will also host other important events such as the mayors' dialogue on digital cities, an academicians summit, a dialogue on the future, and an innovation contest, to introduce guests to new technologies.

Third, we will give full play to the role of the summit as a platform. During the summit, we will introduce activities related to the 20th anniversary of the construction of digital Fujian. We will invite guest provinces Hainan, Shandong and Henan to introduce their outstanding achievements in digital construction and industrial development. We will provide a more open platform for deepening government-enterprise and enterprise-enterprise exchange and cooperation, and promote the signing of digital economy deals by various localities during the summit.

Media friends, digital technology has risen strong and digital applications are infinitely attractive — the digital future is full of vitality. The 3rd Digital China Summit will kick off in 25 days. For it, we will practice General Secretary Xi Jinping's important thoughts on cyber development and major expositions on digital China, and present a wonderful, high-quality event. We sincerely welcome all old and new friends to gather in Fujian to renew their friendship and jointly contribute wisdom and strength to the construction of digital China. Digital Fujian welcomes you!

Thanks again to our media friends for your long-term care and support for the economic and social development of Fujian. Thank you all!

Shou Xiaoli:

The reporters can now ask questions. According to the usual practice, please name the news organization you work for before asking your question. The floor is now open.

CCTV:

My question goes to Vice Minister Yang. As the 3rd Digital China Summit is approaching, could you elaborate on the achievements that have been made in the past three years to build digital China? Thank you.

Yang Xiaowei:

Thanks for your question. Since the 18th CPC National Congress, the CPC Central Committee, with Comrade Xi Jinping at its core, has attached much importance to the development of information technologies (IT). China's IT industry is developing at a rapid pace, and the country has published the Outline of National IT Development Strategy and the 13th Five-Year Plan on IT Development. To serve the overall strategy of the great rejuvenation of the Chinese nation and in the face of profound changes rarely seen in a century, the 19th CPC National Congress outlined the strategic arrangements for building strength in cyberspace, a digital China and a smart society. In the past three years, we have made much headway in this respect. From 2017, the Cyberspace Administration of China has begun publishing progress reports on digital China every year in collaboration with related departments. As seen in the newly published 2019 Digital China Development Report, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, significant progress has been made in IT development in different regions and departments, and the industry is trending from larger quantity to higher quality.

Progress can be seen from the following five aspects:

First, IT infrastructure has improved. IPv6 deployment is gathering momentum. By the end of last year, the number of IPv6 active users reached 270 million, accounting for one third of China's total number of internet users; over 1.39 billion IPv6 addresses have been distributed nationwide. 5G commercial use is also gathering pace. By the end of 2019, China had a total of 130,000 5G base stations. The number of 5G users is also rapidly increasing. The BeiDou-3 satellite navigation system, with all its key components independently developed by China, went fully operational on July 31, offering a global positioning service with 10-meter or less accuracy. Products linked to the BeiDou Navigation Satellite System have been exported to over 120 countries and regions.

Second, innovations are driving IT development. According to the World Intellectual Property Organization (WIPO), China was ranked 14th in Global Innovation Index among other leading innovative nations in 2019, moving up three spots from last year and marking a rise for the fourth consecutive year.

Third, the digital economy is developing in full swing. In 2019, the digital economy maintained high growth as its added value reached 35.8 trillion yuan, accounting for 36.2% of the GDP and contributing 67.7% to GDP growth. The structure of the digital economy is also improving. The value added in industrial digitalization accounted for 80.2% of the overall digital economy, promoting high-quality development of China's industries.

Fourth, digitalization is increasingly benefiting the general public. In the newly published e-government development index ranking by the UN, China was ranked 45th compared with 65th in 2018, joining the very high performing group in e-government. Poverty reduction through internet services is also making tangible progress as an IT service system for alleviating poverty has been largely established nationwide. China is also implementing the digital village strategy, which has brought fresh momentum to rural vitalization. The internet has empowered the disabled to enjoy equal access to all kinds of social activities. On China's main e-commerce platforms, the number of online stores run by the disabled has reached over 170,000, with a combined sales revenue of nearly 30 billion yuan.

Fifth, digital development along the Belt and Road is making new progress. The construction of the China-ASEAN Information Harbor and the China-Arab Online Silk Road is in full swing as China continues to build partnerships in promoting digital economic growth. By the end of last year, China had signed 197 Belt and Road cooperation documents with 137 countries and 30 international organizations, as well as bilateral e-commerce cooperation documents with 22 countries. China has also built terrestrial and submarine cables with countries along the Belt and Road to improve connectivity.

The Cyberspace Administration of China will continue to implement the arrangements made by the CPC Central Committee and the State Council and plan ahead for the IT development in the 14th Five-Year Plan period to boost high-quality digital development in China. We'll mainly carry out the work in the following aspects.

First, draw up the plan for national IT development during the 14th Five-Year Plan period. Second, seize opportunities and speed up new infrastructure development. Third, improve capacity building and advance core technology breakthroughs. Fourth, boost digital transformation in the real economy. Fifth, promote poverty alleviation through internet services. Sixth, enhance governance capacity and speed up the building of e-government. Seventh, embrace innovation and advance rural development through digitalization. Eighth, stay committed to openness and cooperation, and press ahead with digital development in building the Belt and Road. Thank you.

CNR:

In recent years, the integrated development of the real economy and the internet, big data and artificial intelligence (AI) has been accelerating. Could you please introduce the progress in promoting the in-depth integration of informatization and industrialization? What new steps will be taken in the future? Thank you.

Xie Shaofeng:

Thank you for your question. The integrated development of informatization and industrialization refers to the application of new-generation information technology — such as the internet, big data, AI and blockchain — in the industrial sector. It serves as a "connection point," connecting the targets for developing the country into a manufacturing and internet technology-power. It also showcases the path of the new-style industrialization with Chinese characteristics. The Party Central Committee and the State Council have attached great importance to the integrated development of informatization and industrialization. General Secretary Xi Jinping has, on numerous occasions, stressed that industrialization and the use of information should be integrated deeper. In recent years, China's integration of informatization and industrialization has entered a period of fast development where application, innovation and transformation have become priorities, and the manufacturing industry has become smarter and more interconnected with digital and information technology, which are promoting the fundamental changes in production models and forms of enterprises. The main achievements are as follows:

First, the integration of informatization and industrialization has witnessed remarkable achievements. In 2019, China's digital economy accounted for more than one third of GDP. As of this June, the penetration rate of applying digital R&D tools for enterprises reached 71.5%, and the digitalization of key processes hit 51.1%. Integrated development has accelerated the growth of the information technology industry. Given the impact of the pandemic, the revenue of software businesses reached 4.2 trillion yuan between January and July, marking an increase of 8.6% year on year. Software has been playing a bigger role in enabling industries to become more competitive and the economy to become more dynamic and intelligent.

Second, industrial internet platforms and applications have witnessed further development. In the wake of the pandemic, some enterprises have distributed their resources on industrial internet platforms, made flexible adjustments to their manufacturing facilities, and turned to producing other products in the fight against the coronavirus, so as to maintain supply chains. This has provided support for the control and prevention of the virus, as well as the resumption of work. At present, there are over 70 influential industrial internet platforms across the country, connecting more than 40 million industrial devices and providing services for over 400,000 industrial enterprises. In addition, more than 250,000 industrial apps can be found on these platforms.

Third, new models and forms of business continue to emerge. New business models, such as digital management, intelligent production, online collaboration, personalized customization services, and extension of intelligent services have become more popular. As of this June, the penetration rate of industrial e-commerce nationwide had reached 63%, and the penetration rate of entrepreneurship and innovation platforms for key enterprises in the manufacturing industry had surpassed 84.2%.

In the future, the Ministry of Industry and Information Technology will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, seizing the opportunities of the new industrial revolution, so as to promote integration between industrialization and informatization on broader, deeper and higher levels. Our priorities will be as follows:

First, we will accelerate the transformation of manufacturing processes and enhance the level of digital, networked and intelligent manufacturing models. We will continue to establish and promote the standard system for the integration of industrialization and informatization. The new generation of information technology will also be further applied and promoted rapidly in the manufacturing industry when enterprises implement the standards.

Second, we will establish multi-tiered and systematic industrial internet platforms, and further promote the industrial internet innovative development program, so as to foster cross-sector and cross-industry comprehensive industrial internet platforms, as well as distinctive and specialized platforms. We will increase efforts to turn the assembly line production model into a networked manufacturing model, and supply chains to supply networks.

Third, we will continue to foster and integrate new models, forms and industries. We will give full play to the exemplary role of pilot programs and promote the development of personalized customization services, industrial e-commerce, shared manufacturing and the gig economy.

Thank you.

People's Daily:

This year marks the 20th anniversary of digital Fujian development. Could you brief us on its major achievements as well as specific measures for the next step? Thank you.

Zhao Long:

Thanks for your question. Deputy Director Yang Xiaowei has just expounded on the development of digital China from a national perspective. The same developments apply to Fujian Province. Since General Secretary Xi Jinping put forward the important strategic plan for digital Fujian development in 2000, the Fujian Party committee and provincial government have attached great importance to it ever since. As we strengthen top-level planning and enhance the integration of resources, the digital Fujian development has made remarkable achievements, injecting strong impetus into the high-quality development of Fujian province.

Here is a figure that I think illustrates this point. In 2019, the total digital economy of Fujian province reached 1.73 trillion yuan, accounting for 40 percent of the provincial GDP, with the growth rate ranking second nationwide. Meanwhile, the digital government service index of Fujian province topped the national ranking. I'd like to elaborate on those in four separate aspects:

First, the provincial information infrastructure construction registered leapfrog growth. At present, all of the province's prefecture-level cities have reached the standard of an optical-network city while urban and rural areas have realized full 4G network coverage, especially that all villages within the province are equipped with fiber-optic networks. Additionally, the Narrow Band Internet of Things (NB-IoT) covers the whole province and commercial use of 5G network has been speeding up. The province's internet penetration rate ranks fourth in the country. The e-government service network has covered five administrative levels of Fujian, including the provincial, city, county, town, and village levels.

Second, the province's digital government service has improved. Fujian has developed a network for government approvals that spans the entire province, with 97 percent of government approvals and services now available online. Over 90 percent of government services require no physical presence of the applicants, or need one visit at most. Improved functions of the province's all-in-one mobile service platform, the MZT App, have allowed public access to handy services basically anytime online. The wide use of electronic certificates enables the public to access services using their ID numbers and allows enterprises to handle business through their legal person codes.

Third, the province's digital economy has grown rapidly. At present, the province is home to 13 registered electronic information manufacturing enterprises with an output value of over 10 billion yuan, as well as seven of the top 100 internet enterprises in China. The province's online retail sales volume ranks sixth in China. Also, the province is top in the number of enterprises that have reached the national implementing standards for the integration of information and industrialization. A number of 100-billion-yuan digital industry clusters are growing fast. Over the past two summits in particular, the province has registered a total of 462 signed digital economy projects with a total investment of 382.6 billion yuan, of which 130 projects have been completed and 295 others are underway. The digital economy has brought about an increasingly cumulative, amplifying, and multiplying effect on high-quality development.

Fourth, a smart society has brought added convenience to the public and enterprises. The internet has been widely applied to social services in the province. In particular, the province accelerates the sharing of high-quality educational resources between urban and rural areas via a network. It has introduced equipment for sharing educational resources to all the middle and primary schools in the region, offering a strong guarantee for students' continued studies during class suspension due to the epidemic. Remote medical services cover the province's tertiary public hospitals and 83 percent of its community medical institutions, which has effectively alleviated public concern over difficulties in receiving medical treatment. Social security cards are widely used by the province's urban and rural residents, having realized medical treatment and settlement with one card. The payment by a smart transportation card enables the interconnection between cities and prefectures throughout the province. The construction of a smart society gives people an increased sense of gain, happiness, and security.

Next, we will earnestly implement General Secretary Xi Jinping's important thought on cyberspace development and the spirit of his congratulatory letter to the first Digital China Summit, deepening the digital Fujian development in the new era. We will make additional efforts in the following four areas:

First, we will accelerate the construction of the national pilot zone for developing digital economy innovatively. Since Fujian has been listed among the national pilot zones, we will further implement plans for the digital economy to take the lead as well as initiatives regarding cloud services, big data application and intelligent transformation so as to further integrate the digital economy with the real economy.

Second, we will speed up the construction of new infrastructure. The province has just set out a three-year new infrastructure initiative, in which we plan to implement a number of new infrastructure projects, including new network, new technology, new computing power, new security, new integration, and new platform.

Third, we will speed up the development of digital government capacity. We will promote enhanced government services online, so as to make services for businesses and the public as convenient as online shopping.

Fourth, we will accelerate data development in the province. We are working on the effective integration of government data, social public data, and business data. We will further accelerate the development of a data factor market and clarify data property rights and data value to promote data trading and maintain data security, as well as to further release data resource dividends. We will strive to build Fujian into a national digital economy development highland and a model and demonstrative zone for digital China development, injecting new impetus into the promotion of high-quality development across the board.

Thank you.

Hong Kong Economic Herald:

Fujian province is the starting point where the idea of Digital China took shape and was first put into practice. Several achievements have been made here in digital science and technology. What role have these achievements played in helping micro and small businesses overcome difficulties? Thank you.

Zhao Long:

Thank you for your question. As we all know, Fujian has a prosperous private economy with a great number of micro, small, and medium-sized enterprises (MSMEs). To fully implement the deployment and requirements of the CPC Central Committee and the State Council, we have made great efforts to help MSMEs. Specifically, since the COVID-19 outbreak this year, we have advanced epidemic control and promoted economic and social development, making solid progress in stabilizing the six fronts -- employment, finance, foreign trade, inbound investment, domestic investment, and market expectations, and guaranteeing the six priorities -- jobs, daily living needs, food and energy, industrial and supply chains, the interests of market players, and the smooth functioning of grassroots government. We have deepened our efforts to assist sectors that face operation difficulties, as well as MSMEs, to ensure that enterprises can survive and develop. In the first half of this year, more than 47 billion yuan has been saved for enterprises throughout the province through tax and fee cuts, burden easing, and cost reduction. Meanwhile, based on the province's strengths as Digital Fujian, we have made full use of various digital technologies, including big data, to help MSMEs effectively offset the impact of the epidemic. Our efforts were mainly focused on these four areas.

First, by making full use of Financial Services Cloud as a platform. We established a cloud platform for financial services by integrating finance, technology, data, and policies. The platform pooled enterprise data on nearly 4,400 items from 17 government departments covering electricity, taxation, commerce, etc. It then addressed information asymmetry between banks and firms and provided cloud financing services to thousands of enterprises, to effectively address the difficulties and high costs of financing for MSMEs. To date, the Financial Services Cloud platform has helped more than 7,100 enterprises secure their financing needs, totaling 30 billion yuan. During the epidemic, in particular, the platform has seen an explosion in user growth, with a more than 20-fold increase in newly registered users and helped address over 26 billion yuan worth of financing needs.

Second, by encouraging MSMEs to use our cloud service platform. We established a resource center for the industrial internet, introducing them to leading domestic industrial internet companies. We provided enterprises with services, including cloud computing, cloud storage, cloud security, and digital production through the joint efforts of industrial enterprises on the cloud platform and cloud services providers. Some big enterprises are capable of establishing cloud services platforms of their own, while many MSMEs are unable to do so. As a result, we established public services platforms based on the resources of big enterprises and provided services to MSMEs. Up to now, Fujian province has introduced more than 600, high-quality cloud service institutions, launched more than 500 cloud service products and attracted more than 44,000 enterprise users from cloud platforms.

Third, by establishing service platforms including a communication channel connecting enterprises to the provincial government and an app informing users of beneficial policies for enterprises. Using big data technology, these platforms published more than 800 pieces of enterprise-related policies pooled from various government departments, through which people got to know related beneficial policies provided to enterprises by the country and the province in a direct and timely manner. The platforms removed the last crucial hurdle in policy transfer and implementation, ensuring that MSMEs could access policy information more rapidly, conveniently, and precisely. Meanwhile, we strengthened big data analytics and quickly pooled monitoring data on 167 items from 14 departments, including electricity, telecommunications, and taxation, to precisely keep abreast of production resumption and help decision-makers provide targeted assistance to enterprises.

Fourth, by deepening the application of big data in promoting employment. We planned and established a provincial employment database, through which employment information in different regions could be posted and shared by users all over the province, helping to address the needs of both enterprises and job seekers. To provide effective employment services to MSMEs, we enhanced the application of big data analytics in employment, precisely assessed the demand of the human resources market, and forecasted the total demand for the next year, as well as the separate demand of different sectors and professions based on a big data forecasting model. Up to now, the database has provided services to 437,000 enterprises and 24.91 million people from various groups in cities and townships.

The Poster News APP:

Data shows that by March 2020, China's rural online population had reached 255 million, with a rural internet penetration rate?of 46.3%. How will we narrow the gap between the rates in urban and rural areas so as to "balance out" the online population?

Yang Xiaowei:

Thank you for your question and your interest in the internet penetration rate in rural areas. We're proud to say that China tops the world in internet development and internet infrastructure. Looking at the situation abroad, we can see that almost no other country can provide such 4G network coverage as China. The optical-fiber penetration rate in China also ranks number one in the world. Your question shows you care about whether rural residents can enjoy our latest achievements regarding the internet.

The "Broadband China" initiative was launched nationwide because of the priority given to the matter by the CPC Central Committee and the State Council. Following are the major steps taken so far:

The first is improving the level of network coverage. There are five batches of nationwide trials into universal telecommunications services, providing optical fiber to a total of 43,000 poverty-stricken villages and 4G base stations for 9,200 such villages. Currently, over 98% of administrative villages in China are covered by optical fiber or 4G, and generally speaking, there is no gap between urban and rural areas.

The second is reducing expenses. Relevant departments have supported basic telecom operators in cutting expenses, which has benefited over 12 million poor families, changing their way of life and narrowing the urban-rural gap at a lower cost after receiving access to the internet and various information apps.

Next, the relevant departments will further carry out the decisions and deployments of the CPC Central Committee and the State Council to constantly improve rural broadband networks. The sixth set of trials into universal telecommunications services is underway, and its compensation system will be improved. With the aim of allowing people in both cities and the countryside to enjoy the same smooth internet access under the same network, the optical-fiber and 4G coverage of administrative villages, and poverty-stricken villages in particular, will be raised.

Bauhinia Magazine:

We all know that Fuzhou, the capital of Fujian province, is an important city along the Maritime Silk Road. My questions are: What role will the Digital China Summit, known as a foundation for global cooperation, play in building the Digital Silk Road? And, what achievements has it made in recent years? Thank you.

You Mengjun:

Thank you very much for your questions and interest in Fuzhou. Five years ago, the city was designated as one of the strategic hubs of the development of the Maritime Silk Road. From then on, we have kept firmly in mind the Party Central Committee's plans and strived to add new substance to the summit and enhance its influence, so as to share the benefits of digital economy development with other countries and regions along the Maritime Silk Road.

There are two major points which demonstrate the role played by the summit in building the Digital Silk Road:

First, it has promoted the communication and interaction of ideas and thoughts related to the digital world. Proposals regarding the Belt and Road Initiative and the application of digital technologies were deliberated during the previous summits by leading entrepreneurs, investment institutions and high-level experts and scholars. Thanks to such exchanges, the concept of the Digital Silk Road has been promoted, and a wide consensus has been reached that digital technologies can empower social and economic development.

Second, it has stimulated the cooperation and application of digital technologies. Agreements on digital projects were reached during the previous summits, fostering cooperation among countries and regions along the Maritime Silk Road in sectors of business, trade, finance, education and culture. Local Fuzhou enterprises have received positive results from their various explorations. For example, the digital products of NetDragon Websoft Holdings Limited have reached over 100 million users in more than 190 countries. The Newland Group has spread mobile payment technology to almost all countries involved in the Belt and Road Initiative. In addition, the one-stop purchase model of Yonghui Superstores has been welcomed by both retailers and customers, thanks to its construction of global supply chains for consumer goods.

It has been proved that countries and regions along the Maritime Silk Road are looking to share in the dividends produced by the new generation of information technologies, illustrated by the high demand for smart cities and digital applications. Therefore, we hope to take advantage of the summit to reinforce mutual trust and cooperation and share the dividends of advanced digital technologies with countries along the Maritime Silk Road through exploration of new technologies, new business forms and models.

Thank you.

Southern Metropolis Daily:

It is noted that the digital economy has maintained a strong momentum of growth since the start of the COVID-19 outbreak this year. Would you like to brief us on what innovative measures were put in place to develop the digital economy? Thank you.

Shen Zhulin:

Thanks for your question. Since the start of the COVID-19 outbreak this year, the digital economy has grown rapidly, bucking the trend of economic slowdown, which plays a vital role in our fight against the COVID-19 outbreak and promoting the resumption of work and production. I believe the achievement is evident. From health code and online education to expos held on the cloud, the digital economy changes the way we live and work, giving strong impetus to socioeconomic development. General Secretary Xi Jinping pays great attention to the development of the digital economy. This March, during his inspection in Zhejiang Province, General Secretary Xi Jinping pointed out that we should seize the opportunities of industrial digitization and digital industrialization to deploy digital economy. The National Development and Reform Commission (NDRC) has fully implemented the guidance made by General Secretary Xi Jinping and carried out the policy decisions and plans of the CPC Central Committee and the State Council. We have remained sensitive to changes, responded to them with well-judged actions, been ready to adjust the approach when necessary, and actively promoted the development of the digital economy. The measures we have taken are mainly in two aspects, which are as follows.

First, we have faced up to the difficulties and stepped up efforts to promote the digitalization of industries. We know that digital transformation has always been a problem for small and medium-sized enterprises (SMEs). In particular, they were not active in digital transformation. The COVID-19 outbreak has made them realize the benefits that digital transformation can bring. In the past, many enterprises regarded digital transformation as one of their options for development. Now it has become their first choice. However, prominent problems emerged as some of these enterprises have been hesitant to transform or have found it hard or impossible to transform. To solve such problems, the NDRC worked with the Cyberspace Administration of China (CAC) and other related departments to issue an initiative of cloud services and big data application as well as making enterprises smarter. By cooperating with nearly 150 institutions, we launched a digital transformation partnership action plan, mobilizing all sectors of society to drive change. We carried out over 500 measures to support companies to transform. And more than 300 free or discounted services were provided to SMEs. Preliminary statistics show that, since the action plan was launched four months ago, about 3 million individuals and MSMEs have received the support, and their digital transformation problems have been effectively solved.

Second, we have followed the trends and actively promoted the industrialization of the digital economy. While the outbreak has imposed a crisis for us, it has also created new opportunities. New business forms and modes, such as online education, remote work and telemedicine, have emerged quickly, playing an important role in supporting the epidemic prevention and control work, improving people's livelihoods, promoting economic recovery, and stabilizing employment. To seize the opportunity, the NDRC and 12 other departments jointly issued the Opinions on Supporting Sound Development of New Business Forms and New Modes, and Activating the Consumer Market to Drive and Increase Employment to support 15 new business forms and modes. These measures covered 19 aspects, focusing on fostering a healthy environment for development through reform of government functions and accommodative and prudential regulation, in order to energize market entities and drive the sound development of the digital economy.

According to recent statistics, digital economy has maintained a good momentum of growth. In the first eight months of this year, the online retail sales of goods grew by 15.8% year-on-year, accounting for nearly a quarter of total retail sales of consumer goods, which means that the digital economy plays a vital role in stimulating the public's consumption potential and fostering the market. Meanwhile, some of the new business forms and modes have attracted more private investors, enabling some internet platform firms to achieve business revenues of more than 170 billion yuan in the first half of this year, up 13.6% year-on-year.

From the data application perspective, the digital economy also plays an important role in stimulating economic growth and encouraging enterprises to migrate to the cloud and use digital tools. In the first half of this year, the revenues of internet data services was up by 14.3% year-on-year. I believe the statistics show again that the digital economy maintains a robust momentum of growth and offers great potential. We have reason to believe that the digital economy will further inject real momentum into high-quality development. Thanks.

Red Star News:

Mr. You, my question is: How have the previous two summits hosted in Fuzhou influenced the city's social and economic development? Thank you.

You Mengjun:

Thank you for your question. In my opinion, the previous two Digital China Summits have had a deep and lasting impact on Fuzhou in the following four main areas:

First, the summit has helped reach a consensus about development in Fuzhou. General Secretary Xi Jinping put forward the digital Fujian strategic decision 20 years ago, which has proven to be insightful, significant and influential. In sponsoring the summit, we understand and focus more on the necessity, urgency and importance of the city's digital development. Following decisions made last year by the municipal party committee and local government on Fuzhou's strategic digital development, 141 key projects with investment totaling 140 billion yuan were launched there. This year, in line with new decisions by local authorities, we launched 175 cutting-edge information technology projects, including 5G base stations, AI and the industrial internet, with total investment approaching 230 billion yuan. A consensus has been reached that these projects have reinforced the engine of Fuzhou's economy.

Second, the summit promotes Fuzhou's development. With the influence of the Digital China Summit, a number of leading companies in the field, including Huawei, Alibaba, Baidu, ByteDance, Ant Financial and Bitmain, have launched business operations in the city. Over the past few years, the overall investment of Fuzhou's 159 major digital economic projects reached a total of nearly 160 billion yuan. This year, the local digital economy is expected to rise to 450 billion yuan, accounting for 45% of the city's GDP. The number of high-tech enterprises will increase from nearly 700 in 2016 to 2,000 today.

Third, the summit has stimulated industrial upgrading. Concrete progress has been made in the integration of informatization and industrialization. For instance, the establishment of "internet plus textiles" through a cloud service platform that enables enterprises to complete seamless procedures from product promotion and two-way communication to bill confirmation, has saved costs amounting to tens of millions of yuan. Meanwhile, according to our calculations, the Fuyao Glass Industry Group Co Ltd has raised its production efficiencies by 30.5%, thanks to the industrial internet platform which enables its data-based, internet-supported and smart-operated R&D, design, production and sales sectors to run more smoothly. Industrial upgrading can also be seen by the swift bulk transactions of food worth trillions of yuan at the Yuanhong International Food Industrial Park which has partnered with JD.com. Last but not least, the Foxconn Industrial Internet Co Ltd in Fuzhou has integrated manufacturing industry with industrial big-data, industrial AI and 5G technologies, enabling an interconnected network between manufacturers, suppliers and customers. In doing so, production resources are distributed more efficiently.

Fourth, the summit has helped promote more tech-applications in the city. As Mr. Zhao just said, Fuzhou has spearheaded the application of digital technologies in different realms, receiving a warm welcome from the public. For instance, we have created a QR code for our "e-Fuzhou" app, which allows local residents easy access to hundreds of public services, such as public transportation, social and medical insurance, payments and consultations. With data facilities, we provide credibility scores for local enterprises on our "Jasmine Credit Platform" and allow those with high marks to pay after consumption. We also launched a facial recognition service platform which lets passengers take the subway by simply having their face scanned. In addition, our smart parking lots allow drivers to leave and then pay fees later. These scenarios demonstrate the wide range of uses for digital technologies. In the upcoming third summit to be hosted in Fuzhou, a digital asset operation company focused on exploring data-based asset management is scheduled to open. It is the first of its kind to be set up in the country.

Please allow me to take this opportunity to emphasize one more point. During the epidemic outbreak early this year, we adopted diverse and effective approaches to prevent and control the disease from spreading further using the wide range of digital technology applications. With our timely response, the anti-epidemic efforts received positive results. Applications included booking nucleic acid tests via "e-Fuzhou," issuing guidelines via the "e-Prevention" mini program, and fulfilling remote treatments using "internet plus" technologies. All these demonstrate our digital-buttressed anti-epidemic efforts.

The two previous summits have created opportunities that have transformed Fuzhou. We believe that with the hosting of more summits, growing impact will be felt, and we will improve the social and economic development through the meeting.

Thank you.

Cover News:

We know that the digital upgrading of small and medium-sized enterprises is of great significance to the economic and social transformation. What are the difficulties and keys to such digital upgrading? How will the Ministry of Industry and Information Technology push forward such upgrading? In addition, I would like to ask the NDRC to introduce what innovative measures have been carried out to promote the development of digital economy since the epidemic outbreak? What are the main directions in promoting the digital economy development in the next step? Thank you.

Xie Shaofeng:

Thank you for your question. At present, digitalization provides an important driving force for the high-quality development of economy. I should say there are bright prospects to empower SMEs with digitalization and accelerate their recovery and transformation and growth. The difficulties and keys of digital transformation and upgrading of SMEs are mainly reflected in the following aspects:

First, the digitalization and networking of the underlying equipment of some small and medium-sized manufacturing enterprises have not been fully popularized, and the foundation for implementing digital transformation is relatively weak. Second, the degree of digitalization in the R&D and production lags behind that in the management. Third, the cost of digitalization is still relatively high for some micro and small enterprises. Fourth, there is a shortage of talents at this disposal. There is a lack of compound talents who understand both industry and digital technology. Therefore, professional digital talents with strong learning ability and knowledge in many fields are urgently needed to provide services for the transformation of SMEs.

Facing these difficulties, the Ministry of Industry and Information Technology vigorously promotes the SMEs to seek access to cloud computing and various platforms, which are helping to promote digital transformation of SMEs, and also promotes the financing and development of large, medium and small-sized enterprises. It has issued a special action plan for digital empowerment of small and medium-sized enterprises. It focuses on promoting the digital transformation of SMEs in four ways. First, widely soliciting and promoting a number of digital service providers and excellent digital products and services for SMEs. Second, summarizing and introducing a number of cases of digital enabling benchmarking SMEs to promote more SMEs to accelerate the transformation to digitalization, networking and intelligence. The third is to organize a series of activities, such as "a trip of innovation in China" or a high-end forum on digital empowerment of SMEs that promotes the docking of supply and demand, and the application of various digital products. The fourth is to carry out a number of digital, network and intelligent technical training by using online platforms such as " micro classes for enterprises."

By far, the Ministry of Industry and Information Technology has printed and distributed two issues of recommended catalogue of digital enabling service products and activities for SMEs through local governments, industry associations, relevant units and self-recommended enterprises, and has introduced 223 service providers and 254 service products and activities, encouraging local departments supervising SMEs and relevant units to promote the independent selection, docking and use. The ministry has also guided small excellent enterprises and SMEs to become the first to establish a benchmark through digital empowerment. At the same time, in accordance with the idea of "enterprises spend a little more, service providers earn a little less, and the government gives a certain amount of subsidy," we encourage local governments to increase financial support for the digital transformation of SMEs so as to promote such companions to accelerate their digital transformation and achieve high-quality development. Thank you.

Shen Zhulin:

I'll answer the second half of your question first. As for the work we undertook during the epidemic, I have already answered that aspect just now. As the next step, we will seize opportunities provided by the development of the digital economy, maintaining the current good momentum of the development of the digital economy, and further stimulate its potential, further demonstrating its driving forces for industrial development and social transformation. Next, the National Development and Reform Commission (NDRC) will follow the decisions and deployments of the CPC Central Committee and the State Council, and further implement relevant arrangements together with other government departments. Our work will focus on the following five aspects.

First, it is necessary to accelerate the establishment of the data factor market. This is a new task set out at the Fourth Plenary Session of the 19th CPC Central Committee, which is also a fundamental system for the development of the digital economy. We will work with relevant departments to improve standards, regulations and systems on data rights confirmation, sharing, circulation, trading, income distribution, and so on. All these are expected to effectively promote and give full play to data circulation.

Second is to strongly boost construction of the innovative development pilot zones of digital economy. During the World Internet Conference (WIC) last year, the NDRC and the Cyberspace Administration of China (CAC) jointly launched the first batch of digital economy pilot zones, and Fujian province is a focus of such activity. Just now, Governor Zhao have a comprehensive introduction on Fujian's efforts in promoting its development. In this and the following years, we will encourage more pilot zones to innovate boldly on areas such as digital transformation, cultivation of digital new industrial forms, elements circulation, and construction of digital infrastructure. By doing so, we hope to accumulate and sum up more experience that can be copied and spread, so as to advance digital transformation in more regions.

Third, there is a need to improve the digital infrastructure, which is a topic we all concerned about. We will focus on accelerating the building of integrated big data centers around the country, and speeding up the layout of national nodes and key regional clusters of the integrated big data center. All these developments should help improve the utilization efficiency of the data center, deepen data innovation and application, and support digital transformation in all industries and fields.

Fourth is to boost digital industrialization and industrial digitization. I have already introduced this part in answering previous questions. We have launched the SMEs partnership initiative of digital transformation and the initiative of cloud services and big data application as well as making enterprises smarter, and have carried out relevant measures about cultivation of new industrial forms and modes. Next, we will continue to deepen our work. Taking the partnership initiative as an example, we will launch the second batch, and maybe even to a third batch, in order to implement both digital industrialization and industrial digitization pragmatically.

Fifth is to speed up the formulation of the digital economy plan during the 14th Five-Year Plan period (2021-2025), which will be the first special plan on digital economy in China's history. In the plan, we will define the main goals and tasks for the development of digital economy during the 14th Five-Year Plan period, and deploy major constructions, projects and reform measures. Thank you.

Phoenix TV:

From digital Fujian to digital China during the past two decades, what experience and highlights can Fujian province share with us? Thank you.

Zhao Long:

Thanks for your question. Since the digitalization construction is under rapid development, I'd like to talk about some preliminary experience based on our practice, mainly in the following three aspects:

First, the vision and foresight of General Secretary Xi Jinping and the CPC Central Committee. As I mentioned previously, 20 years ago, the Internet and the computer has not been fully popularization, many people even didn't know what was the digital economy. General Secretary Xi Jinping proposed the strategy of building digital Fujian when he worked there, and also worked as the group leader to guide its construction. The group set construction targets for digitalization, network, visualization and intelligentization, and proposed a series of requirements to strengthen top-level design, resources integration, scientific and technological innovation, data sharing, and data security guarantee. Since then, 20 years have passed, and the statements made and requirements raised by the General Secretary are still important for us to follow in today's work. During the two decades, digitalization has penetrated into various areas, including the economy, politics, society, culture and ecology. From digital Fujian to digital China, from technological innovation to wide application, the leapfrog development of digitalization in China has fully demonstrated the vision and foresight of the General Secretary and the CPC Central Committee, as well as the profound connotation and scientific guidance of General Secretary Xi Jinping's thought of building China into a cyber power, which have provided us the foundation and guidance for the construction of informatization.

Second, digital transformation is the trend of economic and social development in the future. During the China International Fair for Trade in Services (CIFTIS) that closed on Sept. 9, General Secretary Xi Jinping delivered a keynote speech. I was deeply impressed by one sentence that, "a new round of technological and industrial revolution in recent years has spurred a boom in digital technologies." Although we can't predict its final outcome, digital technology and digital application will certainly change our way of life and production, and even the shape of economic and social development, and profoundly impact competitive visions in the future. In terms of government management, the application of digital technology will further optimize business environment, enhance government services, and modernize the government's governance system and capacity. In terms of social governance, the application of digital technology will further optimize the distribution and effective allocation of public resources, transform the social governance model from the current one-way management to two-way interaction, from offline to online and offline integration, so as to greatly enhance the sense of gain, happiness and security of our people. In terms of economic high-quality development, the application of digital technology will, on one hand, give birth to a number of digital enterprises, and promote the digital industrialization and development of digital industry and new infrastructures including artificial intelligence, 5G, industrial Internet, big data, cloud computing and blockchain. On the other hand, it will accelerate industrial digitalization, further change industrial forms, boost reorganization of production factors, and especially speed up deep integration of production and service, blur the distinction between production and service, and promote high-end, personalized and customized services. At the same time, intelligent manufacturing will emerge as a new force. Through digital application, enterprise production efficiency has been constantly improved, bringing about new industrial forms and modes such as smart factories and "turn-off-lights factories". It will further bolster leading industries, cultivate emerging industries, as well as promote the transformation and upgrading of traditional industries.

The third thing we have learned is that in this era when the digital construction is developing rapidly, the person successfully seizing this opportunity will gain the initiative in pursuing development. Digital technologies are advancing rapidly, digital applications keep emerging and industrial iteration is accelerating. Pursuing digital development and digital construction is like sailing against the current: you either forge ahead or drift back downstream. One either accelerates one's development or is quickly surpassed, left behind, marginalized and even eliminated. For example, optical film left the stage of history after the emergence of the digital camera which, in turn, was soon replaced by smart phones, indicating the rapid progress brought about by digital technologies. As a result, only those able to keep pace with the development of technological innovation and application coverage can gain the initiative in the fierce competitive environment. Learning from Fujian's experience, the key to promoting digital construction is to uphold the principle of government guidance, businesses as the major actors and market mechanism. Government should provide guidance for digital construction by constantly improving the rules and standards of information application management; stepping up policy incentives for technology research and development, transformation and application; accelerating distribution of new types of infrastructure; and building a favorable environment for the development of new infrastructure. Meanwhile, the government should further promote the orderly and open sharing of digital resources to provide general, high-quality and efficient services for MSMEs through various platforms. To rely on enterprises as the major actors is to stimulate their enthusiasm for innovation and entrepreneurship. In the course of digital construction, enterprises should seek solutions in response to market demand, and then promote implementation. Meanwhile, we encourage digital enterprises to boost the scale and strength, promote the digitalization of traditional enterprises, lower the cost of resources and accelerate transformation to smart manufacturing.

Finally, to uphold market mechanism is to foster an open, fair and just market environment. We will step up our efforts in four areas. First, lowering institutional transaction costs; second, clarifying big data property rights; third, evaluating data resources to promote orderly transaction; fourth, guaranteeing data security. In my opinion, digital-driven development and digitalization are the order of the day. We should ride on the trend of the times, providing new drivers and making more contributions to the economic and social development of Fujian.

Thank you.

Shou Xiaoli:

Please go on. The last question.

Beijing Daily:

The digital economy has attracted wide attention from all sectors of society. Recently, the CPC Central Committee proposed to foster a new, dual-cycle development architecture with domestic and international development reinforcing each other. How will the digital economy promote the building of this new, dual-cycle development pattern? Thank you.

Yang Xiaowei:

Thank you for your question. Facing the complicated COVID-19 epidemic control situation and the conditions of economic and social development, General Secretary Xi Jinping has overseen the general situation, kept pace with the main trend, comprehensively coordinated China's domestic and international efforts, and made a thorough analysis of the challenges and opportunities before us. Meanwhile, he has proposed to make full use of the strengths of China's mega-sized market and the huge potential of domestic demand, and set out the goal of fostering a new, dual-cycle development architecture with the domestic cycle as the mainstay and with domestic and international development reinforcing each other. Combining this key strategic goal with our practice, the Cyberspace Administration of China has fully implemented the deployment of the new development architecture proposed by General Secretary Xi Jinping, and drawn up an outline for our work to further optimize the digital business environment and dual-cycle development of digital economy. For the domestic cycle, we will foster a fair, just and non-discriminatory digital business environment, punish misconducts such as unfair competition and monopoly in the platform economy, safeguard privacy and personal information of consumers, and ensure various rights and interests of consumers in the digital economy. For the international cycle, we will improve rules of digital governance through international cooperation and avoid closed-door development, ensuring the safe and orderly utilization of data. Meanwhile, we understand that as a major nation in digital economy, China should foster a market-oriented, law-based, and internationalized digital business environment that is commensurate with the level of its economic development. Also, China should draw up a new development architecture for digital economy. China is willing to strengthen cooperation with other countries, uphold open market and pursue win-win cooperation.

Thank you.

Shou Xiaoli:

The 3rd Digital China Summit will be opening soon. Let's look forward to this event. Today's news conference concludes here. Many thanks to our speakers as well as our media friends. Goodbye.

.

Read in Chinese

Speaker:

Liu Aihua, spokesperson of the National Bureau of Statistics (NBS), and director general of the Department of Comprehensive Statistics at the NBS.

Chairperson:

Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office.

Date:

July 16, 2020

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Ms. Liu Aihua, spokesperson of the National Bureau of Statistics (NBS), and director general of the Department of Comprehensive Statistics at the NBS. Ms. Liu will introduce China's economic performance in the first half of 2020, and answer your questions.

First, let's give the floor to Ms. Liu Aihua.

Liu Aihua:

The coordinated efforts for epidemic control and economic development delivered notable results with the national economy gradually recovering in the first half of 2020. In the first half of 2020, faced with serious challenges posed by the COVID-19 outbreak and a complex and fast-changing environment both at home and abroad, under the strong leadership of the Central Committee of the Communist Party of China with Comrade Xi Jinping at the core, the whole nation coordinated efforts to advance both the prevention and control of the epidemic and socioeconomic development, and firmly implemented the decisions and arrangements made by the Central Committee and the State Council. Sustained improvements were made in epidemic prevention and control, and the resumption of work, production, business and market was advanced at an accelerated pace. As a result, the national economy shifted from slowing down to rising in the first half of 2020 with economic growth in the second quarter changing from negative to positive and main indicators showing restorative growth. The national economy recovered gradually, the basic livelihood was ensured effectively, market expectation was generally good, and the overall social development was stable.

According to preliminary estimates, China's gross domestic product (GDP) was 45.66 trillion yuan in the first half of 2020, a year-on-year decline of 1.6% at comparable prices. The GDP for the first quarter declined by 6.8% year on year and that for the second quarter grew by 3.2%. The value added of the primary industry was 2.61 trillion yuan, a year-on-year growth of 0.9%; that of the secondary industry was 17,28 trillion yuan, down by 1.9%; and that of the tertiary industry was 25.78 trillion yuan, down by 1.6%. The GDP in the second quarter grew by 11.5 % quarter on quarter.

First, agricultural production was sound and bumper harvest of summer grain was continued.

In the first half of 2020, the value added by agriculture (crop farming) grew by 3.8% year on year, 0.3 percentage points higher than that in the first quarter; specifically, the figure grew by 3.9% in the second quarter, 0.4 percentage points higher than the growth in the first quarter. The overall output of summer grain was 142.81 million tons, an increase of 1.21 million tons over that of the previous year, up 0.9%. The structure of crop farming was further optimized, as areas sown with cash crops such as rapeseed increased. In the first half, the output of milk grew by 7.9% year on year and that of eggs grew by 7.1%. The output of pork, beef, mutton and poultry fell by 10.8%, the decrease of which narrowed by 8.7 percentage points compared with that of the first quarter. Specifically, the output of poultry increased by 6.8%, up 5.7 percentage points; that of mutton, beef and pork dropped by 2.5%, 3.4% and 19.1% respectively, the decrease of which narrowed by 5.2 percentage points, 3 percentage points and 10 percentage points respectively. The production capacity of pigs continued to recover. By the end of the second quarter, 339.96 million pigs were registered in stock, an increase of 5.8% over the end of the first quarter, among which 36.29 million were breeding sows, up by 5.4% year on year, an increase of 7.3% over the end of the first quarter. 

Second, industrial production recovered quickly and high-tech manufacturing and equipment manufacturing registered growth.

In the first half of the year, the total value added by industrial enterprises above designated size declined by 1.3% year on year, 7.1 percentage points slower than the decline of the first quarter; specifically, the figure grew by 4.4% in the second quarter and declined by 8.4% in the first quarter. In June, the total value added by industrial enterprises above designated size grew by 4.8% year on year, 0.4 percentage points faster than that of May, growing for the third month in a row, or up by 1.3% month on month. An analysis by types of ownership showed that the value added by state holding enterprises decreased by 1.5% year on year; that of share-holding enterprises decreased by 0.8%; enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan decreased by 3.4%; and private enterprises decreased by 0.1%. In terms of sectors, the value added from mining went down by 1.1%, from manufacturing down by 1.4%, and the production and supply of electricity, thermal power, gas and water declined by 0.9%, 0.6 percentage points, 8.8 percentage points and 4.3 percentage points slower than the decline of the first quarter respectively. The value added by high-tech manufacturing and equipment manufacturing grew by 4.5% and 0.4% respectively in the first half; specifically, the figures went up by 10% and 9.7% respectively in June. The output of some engineering machinery and new products witnessed fast growth. In the first half of the year, the production of excavators and shoveling machinery, integrated circuits, industrial robots and trucks grew by 16.7%, 16.4%, 10.3% and 8.4% year on year, respectively. In the first five months of 2020, the total profits from industrial enterprises above designated size totaled 1.84 trillion yuan, down by 19.3 percent year on year, the decline of which continued to narrow. Specifically, the figure went up by 6% year on year in May, while that in April decreased by 4.3%. The Manufacturing Purchasing Managers' Index stood at 50.9% in June, 0.3 percentage points higher than that of the previous month, staying above the threshold for the fourth consecutive month.

Third, the decline of service sector narrowed and modern service industries demonstrated favorable momentum.

In the first half of the year, the total value added by the tertiary industry dropped year on year, 3.6 percentage points less than the decline of the first quarter; specifically, the figure grew by 1.9% in the second quarter and dropped by 5.2% in the first quarter. By sectors, the value added by information transmission, software and information technology and that of financial services grew by 14.5% and 6.6% respectively; wholesale and retail trades, accommodation and catering declined by 8.1% and 26.8% respectively, 9.7 percentage points and 8.5 percentage points slower than the decline in the first quarter. In the first half of 2020, the Index of Services Production decreased by 6.1% year on year, 5.6 percentage points slower than the decline of the first quarter; specifically, the figure in June grew by 2.3%, 1.3 percentage points higher than that in May. In the first five months, business revenue of service enterprises above designated size dropped by 6.4%, the decline of which narrowed by 2.2 percentage points compared with that in the first four months; specifically, that of information transmission, software and information technology services grew by 8.4%. In June, the Business Activity Index for services was 53.4%, 1.1 percentage points higher than that in May. Specifically, the Business Activity Index for railway transportation, road transportation, air transportation, postal services, telecommunication, broadcasting, television satellite transmission services, internet, software and information services, monetary and financial services, capital market services and insurance stood at 55% and above. In terms of market expectation, the Business Activity Expectation Index for services was 59%.

Fourth, market sales gradually improved and online retail sales grew fast.

In the first half of 2020, the total retail sales of consumer goods reached 17.23 trillion yuan, down by 11.4% year on year, or 7.6 percentage points slower than the decline in the first quarter; specifically, the figure decreased by 3.9% in the second quarter, the decline of which narrowed by 15.1 percentage points compared with that in the first quarter. In June, the total retail sales of consumer goods reached 3.35 trillion yuan, a year-on-year decline of 1.8%, 1 percentage point slower than the decline in May, or a month-on-month growth of 1.34%. In the first half, analyzed by different areas, retail sales in urban areas reached 14.93 trillion yuan, down by 11.5%, and retail sales in rural areas stood at 2.29 trillion yuan, down by 10.9%. Grouped by consumption patterns, the income of catering was 1.46 trillion yuan, down by 32.8%; and the retail sales of goods were 15.76 trillion yuan, down by 8.7%. The retail sales of goods for basic living and medical supplies grew quickly. The sale of grain, oil and food, beverages and traditional Chinese and Western medicines by businesses above designated size grew by 12.9%, 10.5% and 5.8% respectively, 0.3 percentage points, 6.4 percentage points and 2.9 percentage points higher than the growth in the first quarter. Upgraded consumer goods grew fast. The retail sales of sports and recreational items and that of telecommunication equipment by businesses above designated size grew by 6.1% and 5.8% respectively, despite a decline of 5.1% and 3.6% in the first quarter. Online retail sales reached 5.15 trillion yuan, growing by 7.3% year on year, while that fell by 0.8% in the first quarter. Specifically, the online retail sales of physical goods was 4.35 trillion yuan, up by 14.3%, 8.4 percentage points higher than that in the first quarter, accounting for 25.2% of the total retail sales of consumer goods, or 1.6 percentage points higher than that in the first quarter.

Fifth, the decline of investment in fixed assets narrowed remarkably and the investment in high-tech industries and the social sector picked up.

In the first half of the year, the investment in fixed assets (excluding rural households) reached 28.16 trillion yuan, down by 3.1% year on year, the decline of which narrowed by 3.2 percentage points compared with that in the first five months, or 13 percentage points compared with that in the first quarter. Specifically, the investment in infrastructure was down by 2.7% and that in manufacturing down by 11.7%, the decline of which narrowed by 17 percentage points and 13.5 percentage points respectively compared with that in the first quarter; real estate development went up by 1.9% and down by 7.7% in the first quarter. The floor space of commercial buildings sold reached 694.04 million square meters, down by 8.4%, and the total sales of commercial buildings were 6.69 trillion yuan, down by 5.4%, 17.9 percentage points and 19.3 percentage points slower than the decline in the first quarter respectively. By industries, the investment in the primary industry grew by 3.8% despite a decline of 13.8% in the first quarter; that in the secondary industry went down by 8.3% and that in the tertiary industry down by 1%, 13.6 percentage points and 12.5 percentage points less than the decline in the first quarter respectively. Private investment reached 15.79 trillion yuan, down by 7.3%, 11.5 percentage points slower than the decline in the first quarter. The investment in high-tech industries went up by 6.3%, while that in the first quarter went down by 12.1%; specifically, the investment in high-tech manufacturing industries and high-tech services went up by 5.8% and 7.2% respectively. In terms of high-tech manufacturing, the investment in pharmaceutical manufacturing and the manufacturing of computers and office devices grew by 13.6% and 8.2% respectively. In terms of high-tech services, the investment in services for e-commerce services and commercialization of scientific and technological research findings grew by 32% and 21.8% respectively. Investment in the social sector increased by 5.3%, while declining by 8.8% in the first quarter. Specifically, investment in the health sector and education sector grew by 15.2% and 10.8% respectively, despite a decline of 0.9% and 4% in the first quarter. In June, the investment in fixed assets (excluding rural households) grew by 5.91% month on month. 

Sixth, imports and exports exceeded expectation and the trade structure continued to be optimized.

In the first half of the year, the total value of imports and exports of goods was 14.24 trillion yuan, a year-on-year decline of 3.2%, 3.3 percentage points slower than the decline in the first quarter; specifically, that in the second quarter dropped by 0.2%, and that in the first quarter dropped by 6.5%. The total value of exports was 7.71 trillion yuan, down by 3%; the total value of imports was 6.52 trillion yuan, down by 3.3%. The trade balance was 1.19 trillion yuan in surplus. The trade structure continued to be optimized. In the first half, the import and export of general trade accounted for 60.1% of the total value of the imports and exports, an increase of 0.4 percentage points compared with that in the same period last year. The exports of mechanical and electronic products accounted for 58.6% of the total value of exports, an increase of 0.5 percentage points compared with the same period last year. In June, the total value of imports and exports was 2.70 trillion yuan, a year-on-year increase of 5.1%. The total value of exports was 1.51 trillion yuan, up by 4.3%, and the total value of imports was 1.18 trillion yuan, up by 6.2%. In the first half, the export delivery value of industrial enterprises above the designated size reached 5.43 trillion yuan, a year-on-year decline of 4.9%, 5.4 percentage points slower than the decline in the first quarter. In June, the export delivery value of industrial enterprises above the designated size shifted from a year-on-year decline of 1.4% in May to a growth of 2.6%.

Seventh, consumer prices rose slightly and producer prices for industrial products declined year on year.

In the first half of the year, the consumer price increased by 3.8% year on year, 1.1 percentage points lower than that in the first quarter. Specifically, the price went up by 3.6% in urban areas and up by 4.7% in rural areas. Grouped by commodity categories, prices for food, tobacco and alcohol went up by 12.2% year on year; clothing down by 0.1%; housing down by 0.1%; articles and services for daily use up by 0.1%; transportation and communication down by 3.2%; education, culture and recreation up by 2%; medical services and health care up by 2.1%; and other articles and services up by 5%. In terms of food, tobacco and alcohol prices, prices for grain increased by 1%, fresh vegetables up by 3.4%; and pork up by 104.3%, 18.2 percentage points lower than that in the first quarter. Core CPI excluding the price of food and energy went up by 1.2%. In June, the consumer price went up by 2.5% year on year, and down by 0.1% month on month. 

In the first half of the year, the producer prices for industrial products decreased by 1.9% year on year. The figure in June dropped by 3% year on year, or up by 0.4% month on month. In the first half, the purchasing prices for industrial producers decreased by 2.6% year on year. The figure in June dropped by 4.4% year on year and up by 0.4% month on month. 

Eighth, the urban surveyed unemployment rate declined slightly and employment was generally stable.

In the first half, the newly increased employed people in urban areas totaled 5.64 million, accounting for 62.7% of the whole-year target. In June, the surveyed unemployment rate in urban areas was 5.7%, 0.2 percentage points lower than that in May. Specifically, the surveyed unemployment rate of population aged 25-59 was 5.2%, 0.5 percentage points lower than that of the surveyed unemployment rate in urban areas, or 0.2 percentage points lower than that in May. The urban surveyed unemployment rate in 31 major cities was 5.8%, 0.1 percentage points lower than that in the previous month. The employees of enterprises worked an average of 46.8 hours per week. By the end of the second quarter, the number of rural migrant workers reached 177.52 million.

Ninth, the decline of residents' real income narrowed and urban-rural per capita disposable income ratio dropped.

In the first half of the year, the nationwide per capita disposable income of residents was 15,666 yuan, a nominal growth of 2.4% year on year, 1.6 percentage points faster than that in the first quarter, or a real decrease of 1.3% after deducting price factors, a decrease of which narrowed by 2.6 percentage points. In terms of permanent residence, the per capita disposable income of urban households was 21,655 yuan, a nominal growth of 1.5%, or a real decrease of 2%. The per capita disposable income of rural households was 8,069 yuan, a nominal growth of 3.7%, or a real decrease of 1%. By sources of income, the nationwide per capita wage income went up by 2.5% in nominal terms, net operating income down by 5.1%, net property income up by 4.2%, and net transfer income up by 8.2%. The per capita disposable income of urban households was 2.68 times that of the rural households, 0.06 less than that of the same period last year. The median of the nationwide per capita disposable income was 13,347 yuan, a nominal increase of 0.5% year on year. 

Generally speaking, the national economy gradually overcame the adverse impact of the epidemic in the first half of the year and demonstrated a momentum of restorative growth and gradual recovery, further manifesting its development resilience and vitality. However, we should also be aware that some indicators are still in decline and the losses caused by the epidemic need to be recovered. Given the continuous spread of the pandemic globally, the evolving huge impact of the epidemic on the global economy and the noticeably mounting external risks and challenges, the national economic recovery is still under pressure. Next, we should take Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guideline, coordinate efforts to advance routine epidemic prevention and control and economic and social development, stay goal-guided and problem-oriented, gather strength and strategize moves, recognize, seek and respond to changes, focus on key areas, address inadequacies and shore up weaknesses. We must make solid efforts to stabilize employment, finance, foreign trade, foreign investment, domestic investment, and market expectations, comprehensively implement the tasks to safeguard residential employment, people's livelihood, market entities, food and energy security, stability of industrial and supply chains and operations at grassroots levels, and ensure the implementation of decisions and arrangements so as to win the battle against poverty, achieve the goal of building a moderately prosperous society in all aspects and promote the long-term and stable growth of the economy.

Shou Xiaoli:

Now the floor is open for questions. Please identify your news outlet before asking questions.

CCTV:

The economy has improved significantly in the second quarter. How would you evaluate the overall performance in the first half? Thank you.

Liu Aihua:

Thank you for your question. According to the data presented in the initial briefing, since the beginning of this year, the impact of the COVID-19 outbreak is unprecedented, plunging the world economy into its worst recession since World War II. In the first half, facing severe risks and challenges, the entire nation coordinated its efforts to advance both prevention and control of the epidemic and continue to promote economic and social development. With the implementation of a series of policies, China's economy shifted from slowdown to gradual recovery. The characteristics of economic performance in the first half are mainly reflected in following five aspects:

First, the main indicators showed restored growth. GDP for the first quarter declined by 6.8% year-on-year, while the second quarter saw growth of 3.2%; The total added value of industrial enterprises above designated size declined by 8.4% in the first quarter, but then grew by 4.4% in the second quarter; The total added value of tertiary industry fell by 5.2% in the first quarter, yet then grew by 1.9% in the second quarter; The decline of total retail sales of consumer goods narrowed by 15.1 percentage points in the second quarter compared to the first quarter; The decline of investment in fixed assets narrowed by 13 percentage points from the first to the second quarters. Therefore, the quarterly indicators showed the economy has obviously improved. Looking at the monthly figures, the total added value of industrial enterprises above designated size grew for three consecutive months. The Index of Services Production increased for two consecutive months. The decline of the total retail sales of consumer goods narrowed for four consecutive months. The total value of exports increased for the third straight month. It is by no means easy for China, a large developing country with a population of 1.4 billion, to effectively control the epidemic in a short period of time and ensure its economy can be shifted from slowdown to a rise. China has made it, which shows the strong resilience and potential of the national economy and reflects the effect of the policies issued by the CPC Central Committee and the State Council in a holistic way.

Second, employment levels and consumer prices are generally stable. In June, the surveyed unemployment rate in urban areas was 5.7%, a slight decrease for the second straight month. Specifically, the surveyed unemployment rate of population aged from 25 to 59 was 5.2%, 0.5 percentage points lower than the overall urban rate. In June, enterprise employees worked on average 46.8 hours per week, up by 0.7 hours from the previous month. The increase of consumer prices showed a downward trend. In the first half-year, consumer price went up by 3.8% year-on-year, 1.1 percentage points lower than the first quarter figure; the core CPI rose 1.2% year-on-year, achieving basic stability. In June, consumer prices rose by 2.5%, within the range of a moderate rise.

Third, basic livelihood was ensured effectively. The poverty alleviation drive has achieved outstanding results. In the first half of the year, in places with a large number of poor people such as Sichuan, Guizhou, and Guangxi, the nominal annual growth of per capita disposable income of rural resident was between 5.5% and 7.6%. We continued to strengthen social security and assist those most in need. In the first half of the year, the nominal growth of per capita transfer income reached 8.2%, of which per capita old-age pension and retirement pensions increased by 9.3%, and social assistant grants and subsidies per capita increased by 13.2%. Basic living consumption of residents maintains rapid growth. In terms of the retail sales of goods above designated size in the first half of the year, grain, oil and food grew by 12.9% year-on-year and daily necessities increased by 5.2%.

Fourth, new growth drivers have become stronger in various emerging fields. In the first half, the added value of high-tech manufacturing and equipment manufacturing grew by 4.5% year-on-year, accounting for 14.7% of the added value of industries above designated size, an increase of 0.9 percentage points from the same period last year. Investment in the high-tech sector continued to increase. In the first half, investment in high-tech manufacturing industries and high-tech services went up by 5.8% and 7.2% year-on-year respectively. Investment in the pharmaceutical industry increased by over 10%, and the e-commerce service industry achieved a gain of over 30%. New infrastructure and other related products grew relatively fast. In the first half, urban rail vehicles in service increased by 13%, and the output of charging piles increased by 11.9%. In the first half, online retail sales of physical goods increased by 14.3% year-on-year, accounting for 25.2% of the total retail sales of social consumer goods, up by 5.6 percentage points from the same period last year.

Fifth, market expectation was generally good. The Manufacturing Purchasing Managers Index stood at 50.9% in June, staying above the threshold for the fourth consecutive month. The Business Activity Index for the non-manufacturing sector was 54.4%, achieving a rise for the fourth straight month.

In general, judging from these five characteristics, it can be seen that China's economy overcame the adverse impact of the epidemic in the first half of the year and rebounded gradually. However, we should also be aware that some indicators in the first half, including GDP, industry, service industry, consumption, and investment, are still in decline. Therefore, growth in the second quarter is just a matter of restorative growth. The losses caused by the epidemic still need to be recovered and there is much work to be done to get the economy back to normal.

CNBC:

I have two questions. First, please introduce the consumption situation in first-tier cities. Second, what impact will the pandemic have on economic growth in the third and fourth quarters?

Liu Aihua:

Thanks for your questions. Let me answer the second question first, which is about the trend of economic growth in the third and fourth quarters. 

The recovery of economic indicators in the first half of the year, especially in the second quarter, shows that the economy's sustained recovery in the second half of the year has foundations. 

First, the stable economic recovery in the first half of the year has laid a solid foundation for a sustained recovery in the second half of the year. Since March, many indicators have seen significant gains or narrower declines, which indicates that the impact of the pandemic is generally controllable, and the Chinese economy has a strong capacity for self-adjustment. Our country has a perfect industrial system, increasingly sophisticated infrastructure and the advantages of a super large market, which will continue to help respond effectively to the impact of the pandemic in the next stage.

Second, during the pandemic, many new industries, business forms and business models have been created, which will continue to provide strong support for the economic recovery. During the first half of the year, we noticed that new business models, such as working from home, online education, intelligent construction, and driverless delivery, have efficiently resolved some problems in our lives. New technologies, such as cloud computing, big data and artificial intelligence, are developing rapidly. New industries, such as the digital economy, smart manufacturing and life and health, have become new growth poles, which will provide more support for economic growth in the next phase. 

Third, the effect of macro policies will further pay off. During the first half of this year, to deal with the pandemic's impact, our country has provided fiscal and taxation support, financial support and comprehensively strengthened the policy of giving top priority to employment. All these policies have paid off so far, which provided experience for better responding to the outbreak's impact in the second half of the year and further strengthened our confidence. Meanwhile, the epidemic has exposed some problems, which prompted us to further address problems and reinforce weak links. We will step up innovation to strengthen the basis for sustained growth and vitality of the economy. 

Given these favorable conditions, we are confident of a sustained economic recovery in the second half of the year. Meanwhile, economic recovery has its foundations, potential and conditions to be realized. However, it must also be emphasized that the rapid spread of the pandemic in other countries has made it difficult for the world economy and trade to recover. The recovery of domestic demand is constrained to some extent, and there is still considerable pressure to keep businesses and employment stable. So we must think about worst-case scenarios, fully understand the breadth, complexity and persistence of the impact of the outbreak, focus on ensuring the six priorities of employment, people's livelihoods, development of market entities, food and energy security, stable operation of industrial and supply chains, and smooth functioning at the community level, and ensuring stability in the six areas of employment, finance, foreign trade, foreign investment, domestic investment, and market expectations. We should pay close attention to the implementation of policies and work hard to fulfill the goals of economic and social development set for the year. 

Your first question is about consumption in first-tier cities. We need to make a new statistical grouping based on your question and redefine the first-tier cities. You can contact the information office of the NBS after the press conference, and we will reorganize the statistics. Thank you. 

Market News International:

As the speaker said just now, China's economic rebound is expected to continue in the second half of 2020. If so, will the emergency policies adopted in the first half, such as expansionary fiscal and monetary stimuli, be slowed down or phased out? In H1, China's real estate investment registered robust growth, providing considerable support for economic recovery. Will real estate investment remain strong in H2? The total retail sales of consumer goods still suffered a year-on-year decline in June. Do you think China's domestic demand is now obviously weak? What policies will be taken to boost domestic demand?

Liu Aihua:

Thank you for your questions. The first question is whether the policies introduced in H1 will be adjusted. We need to have a correct understanding of the current economic situation. China's economy showed a significant recovery in the second quarter. Most economic indicators improved or declined at a slower pace in H1. Meanwhile, we also need to be aware that, judging from the cumulative speed seen in H1, GDP and most other indicators in such areas as industry, service, investment and consumption are still in a state of decline. Therefore, we define the current economic recovery only as restorative growth. As for policy adjustment in H2, the Government Work Report has made specific plans. Macro policies should be both forceful and sustainable, and they may be adjusted as called for. In other words, the polices we've adopted are flexible, and they will be moderately adjusted according to future developments in H2, as well as the implementation of measures to ensure stability on six fronts and maintain security in six areas.

The second question is about the current situation regarding real estate investment and its trend in H2. China's real estate investment rose 1.9% in the first six months year-on-year. However, many other indicators are still flat, such as floor space under construction , land purchased and sales of commercial housing. So, further observation is required to judge the trend in real estate development in H2.

The third question is about the total retail sales of consumer goods in H1. The total fell 11.4% year-on-year in the first half. It shows that there are still constraints on the recovery of consumption. As regular COVID-19 control is continued, some forms of consumption involving gatherings or human contact are still being restricted. So, catering industry revenue is still only moving towards restorative growth. Concerning the development of the consumer market in H2, as effective epidemic control measures continue to deliver progress, people will find it more convenient to go out for purposes of consumption. In addition, as supply-side structural reform is further advanced, there will be constantly optimized provision for high-quality goods and services. Despite these favorable conditions, we also need to recognize unfavorable ones. As you noticed, China's per capita disposable income increased in nominal terms in the first half of this year, but fell 1.3% in real terms. So, greater efforts will be needed to boost consumption in the second half of the year.

China News Service:

The NBS released data on its surveyed urban unemployment rate for June. Does this truly reflect the current job market situation in China? As college graduates leave university, are they going to face bigger pressures in finding jobs? Thank you.

Liu Aihua:

Thank you for your question. According to the figures, in the first half of this year, the surveyed urban unemployment rate continued a downward trend. China has adopted some strong measures at various levels to stabilize employment and ensure people's well-being, and the employment-first policy is being fully implemented. These efforts have proved to be effective as the surveyed urban unemployment rate kept declining in recent months. The figure was 5.7% in June. The labor participation rate was also similar to last year's level, at only 0.5 percentage point lower than the same period last year. The proportion of furloughed employees, which people concern a lot, also declined to 0.8% in June, basically matching the figure last year. Even without the COVID-19 outbreak, there are also some people on furlough due to various reasons in daily life. Therefore, as we prioritize employment, the situation has made a positive turnaround in the first half of the year.

We can also see that the COVID-19 outbreak has had a significant impact on the job market. In the first half of this year, the number of newly increased urban jobs was 1.73 million lower than the same period last year. Meanwhile, some major groups such as migrant workers have been impacted disproportionally. By the end of the second quarter, the number of rural migrant workers dropped 2.7% year on year, with a reduction of 4.96 million. The unemployment rate of college graduates also hit a record high compared to the same period in previous years due to a decline in demand and certain restrictions in job seeking and interviews caused by the coronavirus outbreak. The surveyed unemployment rate among those with a junior college or higher degree aged 20-24 (mostly new graduates) was 19.3% in June, up 2.1 percentage points compared with the previous month, and 3.9 percentage points higher than the same period last year. Therefore, as we see some positive changes in the employment situation, some major groups still face significant pressures in finding jobs. Our surveyed urban unemployment rate also reflects this trend.

Next, according to the government work report, we will fully implement the employment-first policy, and continue to work hard to stabilize and expand employment. First, we must implement policies to reduce taxes and fees, social security spending and rents to help businesses navigate difficulties in order to stabilize employment. Second, we should encourage market-based employment and solve the employment problem among college graduates through measures such as expanding enrollment in graduate schools. Third, we must provide greater assistance to job seekers, encourage employment in new business models and in flexible forms, and help rural residents seek jobs or start businesses in places close to their homes. Thank you.

South China Morning Post:

Right now, large parts of southern China are hit by severe flooding, and so I wonder whether you have estimated the disaster's impact on the overall economy? Have the impact been taken into account when you estimated GDP data for the second quarter of 2020? How much impact will the disasters, including the current flooding and the COVID-19 epidemic, impose on Chinese economy in the second half of the year?

Liu Aihua:

Thank you for your questions. Recently, there are many reports about the flooding in China's southern regions. I have paid close attention to the impact of the disaster just as has everyone else. The currently released statistics for June reflect the impact on some fields such as consumer prices. The consumer price index (CPI) data in June showed that prices for fresh vegetables rebounded in that month compared to month-on-month and year-on-year declines registered in May. Prices for fresh vegetables went up 4.2% year-on-year in June, compared with the 8.5% decline in May. However, the impact of flooding in other fields is still being closely monitored. We will continue to keep a close watch and take such impact into account in the future calculations.

For the second question, you asked how the flooding in southern regions would affect economic prospects in the second half of the year. Currently, in some flood-hit areas, people's daily life and work indeed have been greatly affected. In the first half of the year, during the fight against the COVID-19 epidemic, we adopted many macroeconomic policies to strengthen counter-cyclical adjustments, and accumulated rich experience in macro-regulation and ensuring policy space. We will pay close attention to and promptly reflect the impact in this regard. Thank you.

China Mining News:

In the first half of 2020, the mining sector provided coal, nonferrous metals and other energy raw materials for the resumption of work and production, making contributions to the gradual recovery of China's economy. We noticed that from January to May, profits from the mining sector decreased by more than 40% compared with the same period last year, and the rate of decline expanded. What is the reason for this? And, do you predict that the profitability of the mining sector will improve in the second half of the year?

Liu Aihua:

Thank you for your question. The profit level of coal and nonferrous metal industries decreased by a large margin from January to May. The profits of enterprises are affected by many factors such as market demand, price, and production and operation costs. The price factor, especially the international imported price, has had a greater impact on these two industries. There was a dramatic fluctuation in international energy prices in the past six months, and April in particular, with a year-on-year decrease of more than 30% in the first half of the year. Therefore, the price has had a great impact on these two industries. Right now, there are many uncertain factors influencing the international price. We need to further observe the trends for profits in the mining sector. Thank you.

Phoenix TV:

We have noticed that the supply-side has recovered faster than the demand-side, as shown by the statistics. What problems will this imbalance in recovery bring? And what policies will be adopted as part of your efforts to deal with these problems? In particular, what efforts will be taken to make up for the lack of domestic demand? Thank you.

Liu Aihua:

Thank you for your question. Your observation is well noted and it is indeed a matter of public concern. Since this year, the supply-side has been recovering faster than the demand-side as far as the cross-sectional data is concerned. I would like to share my views on this matter from several aspects:

First, the COVID-19 epidemic in the first half of this year had an unprecedented impact on the economy, production and people's lives, including their decision-making toward production and life. Its impact on different sectors and various decisions may be due to our lack of experience. So far, the industrial sector has seen better recovery with positive growth for three consecutive months. The production index of the service sector has registered positive growth for two consecutive months, with some businesses in this sector recovering faster, while other sectors such as accommodation and catering are still in deep decline. In comparison, we have also observed that the supply-side has been recovering faster than the demand-side at present. This may be related to the impact of the epidemic on decision-making by different market players. For instance, the production organization on the supply-side may be a process of centralized decision-making, while on the demand-side it may be more a case of decentralized decisions. That is why there have been some differences in the effects of policies.

Second, cross-sectionally speaking, the supply-side recovers faster than the demand-side, and there are differences even within supply and demand respectively. On the supply-side, the recovery of the industrial sector is faster than that of the service sector, with different performances at different stages. For example, when industrial production slumped after being hit hard by the epidemic, some businesses in the service sector, including financial services, information transmission, software and information services, have indeed shown strong resilience. This shows that some businesses have risen against the tide and bucked the trend during the epidemic. The demand-side is also out of sync. Although the retail and investment data is declining, investments are recovering better than consumption, which reflects that the epidemic's impact on investment is smaller than on consumption. Now, there are still some restrictions on consumption involving contacts and gathering, such as accommodation and catering. This recovery will come slowly.

Third, let's look at the longitudinal trends. In terms of time longitudinally, both the supply-side and the demand-side have shown a trend of rebound or narrowing decline. Despite their different paces, the overall recovery cannot be denied. This may be an objective manifestation of gradual economic recovery from the impact of the epidemic. In terms of macro-policies, a total of 90 policies have been adopted involving enterprise bailouts. We will adhere to the fundamental strategy of expanding domestic demand on the demand-side. With these policies, we will gradually realize unimpeded flow in the economy and production demand, thus finally pushing the overall economy back onto a normal track.

Reuters:

2020 is a very important year for competing the building of a moderately prosperous society in all respects. Do you have confidence that China can achieve the goal of doubling GDP and the per capita income of urban and rural residents compared with those of 2010?

Liu Aihua:

Thank you for your question. You are very concerned about the realization of the goal of building a moderately prosperous society in all respects this year.

First, let me talk about the understanding of a moderately prosperous society in all respects. Since the start of reform and opening up, our understanding of building a moderately prosperous society in all respects has been continuously enriched. Already, the supply of adequate food and clothing has been guaranteed for the people. On this basis, the report to the 19th CPC National Congress pointed out that by the time the CPC celebrates its centenary, we will have developed our society into a moderately prosperous one with a stronger economy, greater democracy, more advanced science and education, thriving culture, greater social harmony, and a better quality of life. Therefore, building a moderately prosperous society in all respects is an intact, systematic and comprehensive set of targets.

Second, the goal of building a moderately prosperous society in all respects is consistent with the goals and tasks of the Five-Year Plans. The 13th Five-Year Plan also includes the goal of building a moderately prosperous society in all respects. This year is the final year of the 13th Five-Year Plan. Judging from the current indicators, after much hard work, most of the quantitative indicators set in the 13th Five-Year Plan will be exceeded or fully completed. For example, the task of doubling GDP and the per capita income is currently close to completion. 

Third, this year's Government Work Report pointed out that winning the battle against poverty is a sign of achieving the goal of building a moderately prosperous society in all respects. After years of hard work, by the end of 2019, the country's rural poor population was 5.51 million, and the poverty headcount ratio fell to 0.6%. Alleviating poverty among these people is the hardest nut to crack. The sudden COVID-19 outbreak this year has also caused certain difficulties and challenges for farmers' income, farmers' out-of-town work as well as the sale of agricultural products in poor areas. Therefore, we must adhere to the current goals and standards in accordance with the established deployment, and take effective measures to resolutely win the battle against poverty.

Generally speaking, the decisive foundation for completing the building of a moderately prosperous society in all respects has been laid. As long as the deployment and policy measures set in the Government Work Report are implemented, the goal of building a moderately prosperous society in all respects will surely be achieved on schedule.

China National Radio (CNR):

We have noticed that prices have remained stable in the first half of this year. At present, we are experiencing a flood disaster, as well as the uncertainties in the epidemic situation at home and abroad. What will happen to our prices in the second half of the year? Recently, due to the impact of the COVID-19 outbreak at Xinfadi market in Beijing, pork prices have shown signs of rising. What will happen to pork prices in the second half of the year?

Liu Aihua:

Thanks for your questions about the consumer price. As you mentioned, consumer prices remained generally stable in the first half of this year, with an overall price rise of 3.8% year-on-year, 1.1 percentage points lower than the first quarter. In terms of monthly changes, the price level has been showing a basical downward trend. In June, the consumer price index rose 2.5% year-on-year, growing within a moderate range. The COVID-19 pandemic and heavy floods posed challenges in maintaining stability. However, we made significant progress in this regard by taking various effective measures. Looking at the composition of the consumer price index, the major growth factor is structural, coming mainly from rising food prices. Among the overall growth of 3.8%, food contributed about 80% of the overall growth, having risen by 16.2% in the first half of the year. In June, the food price rise was 11.1%, and the CPI was 0.1 percentage point higher than the previous month. Food costs also form a major contributor to the overall price level. Looking at the major factors influencing prices in the next half-year, prices of industrial products and consumer goods will not see great changes as the supply and demand situation is basically balanced. Food prices will continue to be a major factor. Yesterday, data from the National Bureau of Statistics showed that the overall output of summer grain increased by 0.9%, creating a pretty solid foundation to maintain grain prices and keeping overall food prices stable. So, there is no reason to expect the price of grain to grow significantly, which means that we are capable of maintaining a moderate growth range.

Your second question is about the trend in the price of hogs. Over the past two years, governments at all levels have taken a series of measures, such as increasing the subsidies and ensuring the level of land used for hog production is sufficient. By the end of the second quarter, the number of pigs registered in stock had grown for three consecutive quarters, measured on a quarter-to-quarter basis. Hog production capacity continues to recover. However, there are challenges in recovering the hog production capacity, such as the impact brought about by heavy floods on the number of pigs that are sent to slaughter in some areas. In June, the pork price increased by 81.6% year-on-year, roughly the same as that of May, which was 81.7%. Positive month-on-month growth was recorded. On the one hand, the measures we took previously are taking effect and the hog production capacity is recovering gradually. On the other hand, we should take notice that the floods affected hog production capacity and hence the pork price. Overall, we have seen notable progress in recovering hog production capacity, and the recovered production capacity will have positive impact on the pork price in the next stage.

Third, there is the impact on vegetable prices caused by floods. Recently, the production, storage and transportation of vegetables in some areas have all been affected by floods. The vegetable price this month reported a positive growth compared to last month. Floods are a temporary problem that may heavily influence the supply of vegetables in the short run, especially in certain areas. However, we all know that the cycle for supplying vegetables is relatively short. And with the supportive policies regarding to production and redistribution of vegetables among different areas, we do not expect great fluctuations in vegetable prices and the vegetable prices will not have a significant influence on the overall price trend in the second half of this year.

Currently, fruit prices are still declining and the price for aquatic products remains stable. Taking these aspects into consideration, food prices overall may fluctuate in the short run but will basically remain stable, with some declines. The overall consumer price will continue to remain stable. Thanks.

Hong Kong Economic Herald:

My question is about employment. The word "employment" was mentioned in the Report on the Work of the Government in 2019 for 30 times, while it was mentioned in this year's government work report for 39 times, with an increase of 30 percent in its frequency. It's clear that the employment pressure is severe in the process of economic downturn. What's your opinion on the employment situation in the next half of this year? Thank you.

Liu Aihua:

Thank you for your question. Employment is indeed the focal point of this year, as it was mentioned many times in the government work report. Stabilizing employment and ensuring people's livelihoods are the focus of this year and also the priority of the tasks of ensuring security in the six areas and stability on the six fronts. Focused on stabilizing employment, governments at all levels have taken active measures. Right now, the trend of economic recovery is obvious and the change of the fundamentals will help stabilize and boost employment.

On the basis of a quick survey conducted by the National Bureau of Statistics, the resumption of work and positions maintain a good momentum; enterprises in many industries are adding new job opportunities. Of course, some industries now do not have a strong need for fresh recruitment. However, as the strengthened employment-first policy continues to work, and with the gradual recovery of the fundamentals and enhanced developmental capacities of enterprises, we are confident we can maintain the overall stability of employment in the next half-year. Thank you.

Shou Xiaoli:

Ms. Liu is very familiar with statistics and the situation. With a sheet of paper in hand, she has answered so many questions over the past hour. That's the end of today's press conference. Thank you, friends from the media. See you next time.

Translated and edited by Zhu Bochen, Li Huiru, Wang Yiming, Wang Qian, Yang Xi, Fan Junmei, Zhang Liying, Zhang Rui, Guo Yiming, Wang Wei, Li Xiao, Wang Yanfang, Duan Yaying, Xiang Bin, Zhang Junmian, Yuan Fang, Cui Can, Huang Shan, Mi Xingang, Jay Berbeck, David Ball, Laura Zheng, Geoffrey Murray. 

In case of any dispute over a discrepancy, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Shen Chunyao, director of the Legislative Affairs Commission of the National People's Congress (NPC) Standing Committee

Zhang Xiaoming, deputy director of the Hong Kong and Macao Affairs Office of the State Council

Chairperson:

Guo Weimin, vice minister of the State Council Information Office of China (SCIO)

Date:

July 1, 2020

Guo Weimin:

Ladies and gentlemen, good morning. Welcome to this press conference. Yesterday, June 30, Chinese lawmakers voted to adopt the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region (HKSAR) at the 20th session of the Standing Committee of the 13th National People's Congress, China's top legislature. A decision was also made to list the law in Annex III to the HKSAR Basic Law.

Today, we have invited Mr. Shen Chunyao, director of the Legislative Affairs Commission of the NPC Standing Committee, and Mr. Zhang Xiaoming, deputy director of the Hong Kong and Macao Affairs Office of the State Council, to introduce the law and to take related questions you might have.

First, we will ask Mr. Shen Chunyao to provide an introduction.

Shen Chunyao:

Friends from the media, good morning! Today marks the 99th anniversary of the founding of the Communist Party of China (CPC), and the 23rd anniversary of Hong Kong's return to the motherland. I'd like to take this opportunity to express my congratulations !

On June 30, 2020, the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region (HKSAR) was passed unanimously at the 20th session of the 13th NPC Standing Committee. The adoption of the law fully represents the will of the people, and reflects the wishes and aspirations of all ethnic groups in China, including our Hong Kong compatriots. President Xi Jinping signed a presidential order to promulgate the law, which goes into effect on the date of promulgation. On the same day, the 20th session of the 13th NPC Standing Committee also adopted the Decision on the Addition to the List of National Laws in Annex III to the Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China, listing the law in Annex III to the HKSAR Basic Law. The decision stipulates that the law shall be applied locally in the HKSAR by way of promulgation by the region. According to the latest information, the HKSAR government completed the procedure for promulgation in the gazette at 11:00 p.m. local time yesterday. The law thus comes into effect in the HKSAR and the rest of the country.

Formulating the law on safeguarding national security in Hong Kong is a major step, a key procedure and an important legislative initiative to implement the spirit of the fourth plenary session of the 19th CPC Central Committee and the third session of the 13th NPC. The promulgation and enforcement of the law will effectively prevent, suppress and impose punishment for offences endangering national security in relation to the HKSAR, as well as plug institutional loopholes in safeguarding national security in the HKSAR. The promulgation and enforcement of the law is of profound and far-reaching significance for upholding and improving the institutional system of "one country, two systems" under new circumstances, and safeguarding China's sovereignty, security and developmental interests, as well as maintaining lasting prosperity and stability in Hong Kong.

On Oct. 31, 2019, the fourth plenary session of the 19th CPC Central Committee adopted the Decision of the CPC Central Committee on Major Issues Concerning Upholding and Improving the System of Socialism with Chinese Characteristics and Advancing the Modernization of China's System and Capacity for Governance. The decision vows to uphold and improve the system of "one country, two systems," establish and improve the legal system and enforcement mechanisms for special administrative regions in safeguarding national security, as well as supporting them in strengthening law enforcement. The decision stipulates there can be no tolerance shown in regard to any act designed to challenge the bottom line of the "one country, two systems" principle and advocate secession. Considering Hong Kong's current situation, and in order to implement the spirit of the plenary session, efforts must be made at national-level to promote the development of systems and mechanisms for safeguarding national security, and to establish and improve the legal system and enforcement mechanisms for the HKSAR to safeguard national security. Multiple measures for this purpose are available at national-level. For example, the NPC and its standing committee can make decisions, enact, amend and interpret laws, as well as list national laws in Annex III to the HKSAR Basic Law. The Central People's Government can also issue directives. Related departments of the CPC Central Committee and the State Council undertook earnest study, discussion and evaluation, and, considering various factors, they proposed an approach combining "decision plus legislation" to advance the issue. As you know, on May 28, 2020, the third session of the 13th NPC adopted an important decision, namely, the Decision on Establishing and Improving the Legal System and Enforcement Mechanisms for the Hong Kong Special Administrative Region (HKSAR) to Safeguard National Security. It is an important institutional arrangement made by China's top legislature in accordance with the Constitution and the HKSAR Basic Law, to meet the needs created by new circumstances. The decision provided a constitutional basis for the NPC Standing Committee to formulate related laws.

Shen Chunyao:

The Standing Committee of the National People's Congress (NPC) held its 19th and 20th sessions in mid- and late June successively, and adopted the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region. With the promulgation and implementation of this law, the important institutional arrangements for safeguarding national security in regard to the HKSAR have been shown completely, firstly through the decision of the NPC and then by the law adopted by the NPC Standing Committee. The newly-adopted law consists of 66 articles forming six chapters. These are Chapter I General Principles, Chapter II The Duties and the Government Bodies of the Hong Kong Special Administrative Region for Safeguarding National Security, Chapter III Offences and Penalties, Chapter IV Jurisdiction, Applicable Law and Procedure, Chapter V Office for Safeguarding National Security of the Central People's Government in the Hong Kong Special Administrative Region, and Chapter VI Supplementary Provisions.

This is a comprehensive law displaying three types of legal norms, namely, substantive law, procedural law and organic law, that are fully reflected in the various provisions. The text of the law has been promulgated. Let me provide you with a brief summary of the contents. Firstly, the law clearly defines that the Central People's Government has an overarching responsibility for national security affairs relating to the HKSAR, and it is the duty of the latter under the Constitution of the People's Republic of China to safeguard national security. Second, it clearly defines the important principle of the rule of law to which Hong Kong should adhere so as to safeguard national security. Third, it clearly defines the duties and functions of governmental entities in Hong Kong for safeguarding national security. Fourth, it clearly defines the four categories of offences endangering national security that must be prevented, suppressed and punished, including activities promoting secession, subversion, terrorist activities and collusion with a foreign country or with external elements to endanger national security. It also sets out corresponding penalties in every regard. Fifth, it clearly defines the jurisdiction over cases, applicable law and related procedural matters. Sixth, it clearly defines that an office for safeguarding national security of the Central People's Government in the Hong Kong Special Administrative Region is to be established, and the office is to be known as the Office for Safeguarding National Security of the Central People's Government in the Hong Kong Special Administrative Region. It also defines the circumstances in which this office and relevant national authorities will act to exercise jurisdiction over a case concerning any offence deemed to endanger national security, and the procedures to be followed.

In short, we believe that, with strong leadership and effective measures undertaken by the central authorities and with the extensive support of people across the country, including our Hong Kong compatriots, the promulgation and implementation of this law will effectively safeguard the national security in the HKSAR and ensure the steady implementation of the policy of "one country, two systems" there.

That's all I would like to introduce at this stage.

Guo Weimin:

Thank you, Mr. Shen. Now let's welcome Mr. Zhang Xiaoming to give his introduction.

Zhang Xiaoming:

Good morning, friends from the media. Today marks the festive 23rd anniversary of Hong Kong's return to the motherland and the establishment of the Hong Kong Special Administrative Region. Let us first offer wishes for a happy holiday to more than 7.5 million residents there. Many friends here may have noticed two identical numbers in the topic of today's press conference, that is, we have waited for 23 years for implementing Article 23 of the Basic Law of the Hong Kong Special Administrative Region. Now, finally, we have the promulgation and implementation of the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region. It can indeed be said that it was bound to happen like this, and that is just the way it is. It is an incident in history, yet being inevitable as it is in line with the law of development. Taking this opportunity, I would like to share thoughts on four points in regard to the significance and influence of this law.

First, the law marks a milestone in advancing the cause of "one country, two systems."

We were bound to encounter many challenges when pushing forward the unprecedented "one country, two systems" cause, with a need to address new problems continuously. Since the return of Hong Kong, the central government has made five interpretations and four decisions on issues related to the implementation of the Basic Law of the Hong Kong Special Administrative Region. However, this time, it was the NPC that made the decision and the NPC Standing Committee that enacted the law, making it the most important measure taken by the central government in handling Hong Kong affairs. This is the second important law undertaken by the Central Government tailored to the needs of Hong Kong after the Basic Law of the Hong Kong Special Administrative Region. It embodies the general requirements for the comprehensive and accurate implementation of the "one country, two systems" policy, further incorporating its principles and the fundamental bottom line into law, and building a firm institutional protective screen to prevent and control national security risks in the region, with far-reaching influence for the steady implementation of "one country, two systems."

Second, this law represents a new landmark in the central authorities' efforts to improve the governance of Hong Kong.

The central government has long been exploring a major topic: how could we under the principle of "one country, two systems" improve the governance of Hong Kong, a city that retains a capitalist system and has a complicated social and political situation? Last fall, the fourth plenary session of the 19th Central Committee of the Communist Party of China (CPC) came up with important measures for improving the framework of "one country, two systems," bearing in mind the overall picture of advancing the modernization of China's system and capacity for governance. This law constitutes an important step to implement these improvements. The legislation embodies the growing importance the central authorities attach to the top-level design of the system for the governance of Hong Kong, to the rule of law mentality, to addressing in a flexible way both the symptoms and root causes of a problem, to better utilizing the rights provided to the central authorities by China's Constitution and the HKSAR Basic Law and effectively integrating them into the city's governance system so that the overall development of the situation in Hong Kong is well reined in. All of them will be transformed into governance efficacy in the future.

Third, this law is the protector of Hong Kong's prosperity and stability.

Although Hong Kong was under British rule for over 150 years, the city didn't begin to really thrive until the 1980s. It is a thought-provoking fact. One of the most important things we've concluded is that Hong Kong must rely closely on the Chinese mainland and connect with the rest of the world; consolidate its status as an international financial, trade and shipping center; and make use of its unique status and advantages to serve the country's reform and opening-up and modernization drive, thus better interacting with the Chinese mainland and other countries. This is of key importance to Hong Kong's prosperity and stability. If we sit back and let various anti-China and separatist forces stir storms in Hong Kong and even turn the city into a base to launch penetrative and subversive activities against the Chinese mainland, it will by no means be a blessing but a misfortune for Hong Kong, and it will destroy not only the "one country, two systems", but also Hong Kong's prosperity and stability and the well-being of its residents. This law, which will only target a tiny number of criminals endangering national security, will serve as a "sharp sword" hanging over their heads to deter any external forces that interfere in Hong Kong affairs. The law will fully protect not only the life and property and the various rights and freedoms of the vast majority of Hong Kong residents, but also the legitimate rights and interests of foreign investors in Hong Kong. Therefore, the law will stabilize Hong Kong's prosperity and stability. 

Fourth, this law is a turning point for Hong Kong to get back to the right track.

A week ago, at a seminar in Hong Kong to solicit opinions on the draft of the law, Hong Kong people from all walks of life, including businessmen, professionals, schoolmasters and taxi drivers, expressed their dismay at the turbulence and chaos triggered by the now-withdrawn extradition bill last June. Some of them still feel disheartened. They said, some Hong Kong residents want to emigrate because they fear violence and riots and see no way out. A member of Hong Kong's Legislative Council told me that one of his good friends recently applied for immigration to Singapore and got his application approved. However, when he learnt that the country was in the process of drafting a law on safeguarding national security in Hong Kong, he tore his application paper into pieces right away and exclaimed with excitement, "there is way out for Hong Kong." At the seminar, many Hong Kong friends expressed the same view. It is high time for Hong Kong to turn chaos into order and emerge stronger. I believe this law can turn things around and produce game-changing effects. In a word, this very law can help restore order in Hong Kong. 

Just as Mr. Shen said just now, today is also the 99th founding anniversary of the CPC. The CPC has not only created the grand vision of "one country, two systems", but also steadfastly steered the ship of "one country, two systems" to break the waves. I remember that ever after the "one country, two systems" principle was proposed, there were more than one waves of emigration and divestment, but all the fears and misgivings have been erased by time and facts. The introduction of this law today will probably fuel misgivings and uncertainties among some people, which is normal. But I firmly believe that time and facts will prove us right. On the 23rd anniversary of the establishment of the HKSAR, we have sent Hong Kong a "birthday present" in the form of this law. It will surely continue to show its precious value.

That's all I'll say for now, thank you all.

Guo Weimin:

Now it's time for questions. Please indicate the news organization you represent before raising a question. Let's begin. 

CCTV:

It took the NPC Standing Committee just one month to complete legislation for the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region and to add it into Annex III to the Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China. Please introduce the legislative procedures of the law. And, did you listen to and seek opinions from the HKSAR during this process?

Shen Chunyao:

It was indeed quite unusual for the NPC and itsstanding committee to issue the Decision of the National People's Congress on Establishing and Improving the Legal System and Enforcement Mechanisms for Safeguarding National Security in the Hong Kong Special Administrative Region and the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region successively, like you said, in just over a month. Several factors have played very important roles in this process.

First, there had been widespread demand for legislation. When explaining the draft decision at the third session of the 13th NPC, Vice Chairman of the NPC Standing Committee Wang Chen stated that after the promulgation of the decision, the NPC Standing Committee would actively advance related legislative procedures toward plugging the institutional loopholes in safeguarding national security in the HKSAR, enhancing law enforcement agencies, enforcement mechanisms and law enforcement capabilities for safeguarding national security in the HKSAR, and ensuring the effective implementation of relevant laws in the HKSAR. You might remember that, more than a month ago, when the "two sessions" took place this year, NPC deputies, members of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) and all sectors of society called for speeding up relevant legislation. The department in charge of legal affairs at the NPC Standing Committee had received many similar demands from different sectors before and after that period. The NPC Standing Committee's work report, delivered by Standing Committee Chairman Li Zhanshu and approved at the third session of the 13th NPC, made clear requirements for this year's legislative work, including expediting relevant legislative process. So for some time, people from all walks of life across the nation, including in the HKSAR, had expressed the same demand and wish. This broad social consensus and legislative demand was the first important factor. 

Second, we laid a solid foundation for completing the task. Taking two steps - making the decision and making the law - to advance work concerning the legal system and enforcement mechanisms for safeguarding national security in the HKSAR was a holistic and systematic approach. The NPC was simultaneously studying the drafting of the relevant law while taking the first step to make the decision. The relevant documents of the third session of the 13th NPC demonstrate the close relationship between the making the decision and making the law. In the explanation to the draft decision at the third session of the 13th NPC, there were clear overall requirements for conducting the task, which included adhering to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implementing the spirit of the 19th CPC National Congress and the second, third and fourth plenary sessions of the 19th CPC Central Committee, and upholding and improving the system of "one country, two systems", as well as the five important principles that should be carefully adhered to and understood in conducting the task. The decision is made up of seven articles. These basic points in the new institutional arrangements had been fully reflected during the NPC session. The second step, making the law, was the inevitable requirement, key link and important component for implementing the NPC's relevant decision. In other words, it was a step to fully implement, fully embody and carry out the spirit and requirements of the third session of the 13th NPC in law. So, when laying the foundation for completing the task, we were considering the second step while taking the first. 

The central government and relevant departments organized competent personnel and legal experts, including those very familiar with the laws of Hong Kong, to form a team focusing on completing the text of the draft law in a short time. This was the result of collective wisdom and efforts. Several time points in the process are worth mentioning. Before the formulation of the draft, we listened to and sought opinions. After the draft was formulated, we also listened to opinions through various methods and channels by presenting the draft text. During the deliberation of the NPC Standing Committee, we also listened to opinions through various methods and channels, including the leadership of the central leading group on Hong Kong and Macao work, competent departments, and the legal affairs organs of the NPC, and the Liaison Office of the Central People's Government in the HKSAR. In Beijing, Shenzhen and Hong Kong, before and after the formulation of the text of the draft law and during the deliberation of the NPC Standing Committee, we all listened to opinions from various groups, especially those from the HKSAR, including the chief executive, other relevant top officials, the president of the Legislative Council, representatives of the pro-establishment camp, NPC deputies from the HKSAR, members of the CPPCC National Committee from the HKSAR and some provincial-level CPPCC members from the region, the legal profession, and other sectors of society, including people from economic, education and business circles. This was a very important feature in the deliberation and formulation of the draft law.

Third, the NPC Standing Committee placed great emphasis on the important legislative agenda of the law on safeguarding national security in the HKSAR. The NPC plenary session and the NPC Standing Committee adjusted their work arrangements according to the regulations of the Legislation Law, so as to accelerate the legislation process. Generally speaking, a draft might become a law after being deliberated one, two or three times, depending on specific cases, by the NPC Standing Committee. According to Article 30 of the Legislation Law, a draft can be submitted for voting after two deliberations if there is a broad consensus. The law on safeguarding national security in the HKSAR was adopted after two deliberations at the 19th and 20th sessions of the 13th NPC Standing Committee.

In general, after the first deliberation, a draft law will be released on the official website of the NPC to solicit public opinions. However, according to Article 37 of the Legislation Law, it can also be withheld from public view on the decision of the meeting of the Council of Chairpersons of the NPC Standing Committee. As the national security legislation for Hong Kong was considered very special and sensitive, the meeting of the Council of Chairpersons, after taking all aspects into consideration, decided not to release the full text of the draft law for public response. Instead, it was decided to listen to and solicit opinions from all relevant subjects, especially those in Hong Kong, through various channels and means. Opinions were also solicited from dozens of central and state organs, relevant provinces, autonomous regions and municipalities, as well as cities with districts in the vicinity of Hong Kong and Macao. Moreover, opinions from experts and scholars were closely studied. During the deliberation process, opinions from all walks of life, including those from members of the NPC Standing Committee, were also closely studied. Therefore, this law gathered a broad consensus, reflecting the spirit of the CPC Central Committee, as well as the common will and aspirations of the Chinese people including our Hong Kong compatriots. The law was drawn up in full compliance with the legislative procedures of China.

There was one more job after the adoption of the law, which I mentioned just now, that is, the newly-adopted law should be added to Annex III of the HKSAR Basic Law. This was based on the stipulations and requirements of the NPC decision and the HKSAR Basic Law. It involved a very important procedure: The NPC Standing Committee, before adopting a decision to add the law to Annex III of the HKSAR Basic Law, should consult its HKSAR Basic Law Committee and the HKSAR government. This was also a very important channel to solicit the opinions of a wide range of Hong Kong society including its government. The process was completed before June 30, in a short period of time, though. Therefore, the legislation and relevant decisions of the NPC Standing Committee were strictly in line with the legal procedures of China.

TASS:

Media outlets in some countries have recently published editorials claiming the law on safeguarding national security in HKSAR is a move that is against the principle of "one country, two systems". What's your comment on this? In addition, the same countries even threatened that China would become subject to severe sanctions. What's your take on that?  

Zhang Xiaoming:

First, the law on safeguarding national security in the HKSAR fully complies with the "one country, two systems" principle. It perfectly combines upholding the "one country" prerequisite and respecting the differences between "two systems". The purpose of the legislation is actually to safeguard "one country, two systems", and the content of the law does not go beyond the established framework. Its legislative effect is now foreseeable, and it will ensure the steady and long-term implementation of the "one country, two systems" policy. Certain occurrences deviating from the right track of the "one country, two systems" principle have occurred in Hong Kong, including some that have even challenged the bottom line of this policy. This law, to some extent, is intended to correct these deviations. Figuratively speaking, it intends to move closer to the side of "one country". This is ultimately to uphold and improve the "one country, two systems" policy rather than change it.

I noticed that certain politicians in some countries said we are now practicing a policy of "one country, one system" in Hong Kong. If that was so, it would be easy. We could simply implement China's national laws, including the Criminal Law, the Criminal Procedure Law and the State Security Law, in the HKSAR. Why would we go to such lengths to tailor-make a specific law on safeguarding national security in Hong Kong? A key issue lies in whether one understands the "one country, two systems" policy fully and faithfully. We all know that the central government has been repeatedly stressing the importance of fully and faithfully implementing this policy, because some people in Hong Kong and somewhere else in the world always intentionally distort it. Every time when the central government exercises certain powers, some people in Western countries will jump out and unwarrantedly accuse it of undermining the "one country, two systems" policy and of eroding Hong Kong's high degree of autonomy. It seems to them that the central government of China should keep out of Hong Kong's affairs, while they can point their fingers at will. But, how could it be possible for the central government to sit and do nothing when the anti-China forces seeking to disrupt Hong Kong are rampantly carrying out acts and activities to split the country and jeopardize national security? Is there any country in the world that would turn a blind eye to the constant occurrence of crimes endangering its security?! "One country, two systems" is our national policy. No one cherishes it more than us; no one understands its true essence better than us; and no one enjoys more rights to define and interpret it than us.

As for the comments you have just mentioned, that some countries are threatening to impose severe sanctions on certain Chinese officials, I think that is the logic of banditry. What we are doing right now is formulating a law on safeguarding national security in one of China's local administrative regions. It's none of your business, because it's entirely our own domestic affair. What I have done should not offend you, so why should you use force against me? Hong Kong people like to ask, "Is there any mistake?" and say, "It's none of your business!" It is certain that we are not scared by these threats. The days when Chinese people took cues from others and were at their beck and call are long gone.

Sing Tao Daily:

Hong Kong society pays much attention to the issues of law enforcement and jurisdiction over criminal cases. Does the Office for Safeguarding National Security of the Central People's Government in the HKSAR belong to the entities set up in the HKSAR by departments of the Central Government, covered in Article 22 of the Basic Law of the HKSAR of the People's Republic of China? According to Article 60 of the Law of the People's Republic of China on Safeguarding National Security in the HKSAR, the acts performed in the course of fulfilling the duty by the office are not to be subject to the jurisdiction of the HKSAR. So, how should we understand this? With the Law of the People's Republic of China on Safeguarding National Security in the HKSAR coming into force, how will the office perform its duties? Will criminal suspects be sent to Chinese mainland for trial? Will they be tried in accordance with the Law of the People's Republic of China on Safeguarding National Security in the HKSAR or the law prevailing in the Chinese mainland? Thank you.

Zhang Xiaoming:

The central authorities have the power and the responsibility to take all necessary measures to safeguard national security. This is a general principle and the basic starting point in considering specific issues. According to the Law of the People's Republic of China on Safeguarding National Security in the HKSAR, the Central People's Government establishes in the HKSAR an office for safeguarding national security. The name of the office is specified in the Law as the Office for Safeguarding National Security of the Central People's Government in the Hong Kong Special Administrative Region. This office is established on the basis of the decision taken by the National People's Congress last month, and the just adopted The Law of the People's Republic of China on Safeguarding National Security in the HKSAR. Its name also shows it is an organ of the Central People's Government. Thus, it's different from "offices set up in the Hong Kong Special Administrative Region by departments of the central government, or by provinces, autonomous regions, or municipalities" as written in Article 22 of the Basic Law of the HKSAR of the People's Republic of China. They are not the same thing.

According to Article 60 of the Law of the People's Republic of China on Safeguarding National Security in the HKSAR, actions performed in the course of fulfilling the duties of the Office for Safeguarding National Security of the Central People's Government in the Hong Kong Special Administrative Region and its staff in accordance with this law, are not subject to the jurisdiction of the HKSAR. This is very clear, and it means the executive, legislative and judicial organs of the HKSAR cannot intervene. In other words, they have no means to seek to govern the acts performed by the office and its staff, deemed necessary by the office in performing its duties in accordance with the law. Because the power exercised by the office extends beyond the autonomy of the HKSAR, and many of the cases the office will investigate involve state secrets, it's entirely reasonable that the exercise of its legal duties should not be subject to the jurisdiction of the HKSAR. This provision also refers to the relevant provisions of the Law of People's Republic of China on Garrisoning the Hong Kong Special Administrative Region as well as certain international practices. As we know, there were three organs dispatched by the Central People's Government to the HKSAR. These are the Liaison Office of the Central People's Government in the Hong Kong Special Administrative Region, the Office of the Commissioner of the Ministry of Foreign Affairs in the Hong Kong Special Administrative Region, and the Hong Kong Garrison of the Chinese People's Liberation Army. The Law of People's Republic of China on Garrisoning the Hong Kong Special Administrative Region has such provisions. Since the establishment of the Office for Safeguarding National Security of the Central People's Government in the HKSAR, the number of the organs dispatched by the Central People's Government to HKSAR has, therefore, become four. In the United States, there exist federal and local state judicial systems. In regard to some issues, the states have no rights to assume overall governance. However, this does not mean that no one is responsible to the Office for Safeguarding National Security of the Central People's Government in the HKSAR. The Law of the People's Republic of China on Safeguarding National Security in the HKSAR provides strict regulations on the procedures and supervisory mechanisms for the office in performing its duties.

You have asked several questions on how the Office for Safeguarding National Security of the Central People's Government in the HKSAR will perform its duties. According to Article 55 of the Law of the People's Republic of China on Safeguarding National Security in the HKSAR, the Office for Safeguarding National Security of the Central People's Government in the HKSAR will exercise jurisdiction in three specific situations. The law enforcement work of the office mainly focuses on initiating investigation into specific cases, taking necessary investigatory measures, and arresting relevant criminal suspects after submitting the case to the designated people's procuratorate for approval. As for the following steps, including "Jian Kong" in Hong Kong law or "Qi Su" in law on the mainland, as well as trials, the law clearly stipulates that the Supreme People's Procuratorate designates a prosecuting body to undertake this role, and the Supreme People's Court designates a court to adjudicate on it. The reason why the law has such provisions is that Hong Kong has a different legal system from that of Chinese mainland. The relevant authorities of the central government and the relevant authorities of the HKSAR form two different law enforcement and judicial bodies that should, and indeed can only enforce their own laws. It is impossible to ask Hong Kong police, prosecutors or judges to enforce the law of Chinese mainland, nor ask police, prosecutors or judges of Chinese mainland to enforce the law of Hong Kong. Due to lack of understanding, such activities will lead to conflicts and confusion in terms of jurisdiction and application of the law. Therefore, in accordance with the design and provisions of the Law of the People's Republic of China on Safeguarding National Security in the HKSAR, the law enforcement and judicial teams of the central government and the HKSAR authority will have separate but complete jurisdictional processes consisting of case filing and investigation, examination and prosecution, trial and punishment. The two teams will be responsible for themselves, featuring clear division of labor and jurisdiction. Meanwhile, they will support, coordinate with and complement each other, establishing a relationship of support, coordination and complementarity, and jointly constituting a system and mechanism for safeguarding national security in the HKSAR. That's my answer.

Guangming Daily:

As we know, the law is called the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region, and it not only covers the Hong Kong Special Administrative Region (HKSAR). How do you interpret safeguarding national security in the HKSAR? Thank you.

Shen Chunyao:

The key words are safeguarding national security in the HKSAR. Let us take a minute to look back over progress that has been made. According to the Decision at the fourth plenary session of the 19th Central Committee of the Communist Party of China (CPC) last year, efforts must be made to establish and improve the legal system and enforcement mechanisms for the special administrative regions to safeguard national security. Later, efforts were focused on the HKSAR — because we another special administrative region. The third session of the 13th National People's Congress (NPC) this year decided, at the national level, to establish and improve the legal system and enforcement mechanisms for the HKSAR to safeguard national security. As you said, the Law of the People's Republic of China on Safeguarding National Security in the HKSAR includes, but is not limited to, the HKSAR. So, we can interpret safeguarding national security in the HKSAR from the following three levels:

First, the HKSAR should safeguard national security in accordance with the law. It has been made clear in the Decision at the national people's congress and the newly adopted law that the HKSAR should fulfill its constitutional duty. The HKSAR's administrative, legislative and judicial bodies should fulfill their duties in safeguarding national security in accordance with this law and other related laws and regulations. The HKSAR is extremely important and assumes major responsibilities.

Second, national security should be safeguarded in the HKSAR. As Mr. Zhang said, the central government will set up an office, called the Office for Safeguarding National Security of the Central People's Government in the Hong Kong Special Administrative Region. Several existing offices of the central government in Hong Kong are also, to some extent, related to safeguarding national security. As such, the second interpretation is that it is regional, but is not limited to safeguarding national security in the HKSAR.

Third, the Central People's Government has an overarching responsibility for national security affairs relating to the HKSAR. What is the overarching responsibility? It is the top responsibility, the ultimate responsibility, and the overall responsibility. This level contains more meaning than the previous two - the HKSAR itself should safeguard national security and safeguarding national security in the HKSAR. The central government is in Beijing and it has overarching responsibility for national security affairs related to the HKSAR. As such, we should understand the law in a broader sense. All six chapters in the law have clear stipulations. The second chapter specifies the HKSAR's duties and institutions of safeguarding national security, while the fifth chapter specifies the institutions of the Central People's Government in the HKSAR for safeguarding national security . So overall, the law has a broad significance.

Reuters:

Could you please elaborate on the definition of collusion with foreign forces? Specifically, what actions constitute inciting hatred towards the central government or the Hong Kong government? How broadly will this collusion with foreign forces be applied? 

Zhang Xiaoming:

First of all, Article 29 specifies the meaning of "collusion with a foreign country or with external elements to endanger national security." "Collusion" here does not refer to normal international exchanges, which do not involve suspected crimes. Some people in Hong Kong may not be familiar with the word "collusion." Actually, it can be found in the criminal law of China and other countries as well. "Collusion," a derogatory word, literally means a secret agreement between two or more parties to do bad things. But in criminal law, collusion is not about merely doing bad things, but committing criminal offenses. Article 29 specifies acts that could be classified as collusion and what kind of collusion may constitute a crime.

I have the legal text here and it specifies very clearly. It includes two main kinds of misdeeds. The first involves those who steal, spy, obtain with payment, or unlawfully provide State secrets or intelligence concerning national security for a foreign or external institution, organization or individual. It is similar to what we usually call espionage. The second involves those who request a foreign or external institution, organization or individual, or conspire with them, or directly or indirectly receives instructions, control, funding or other kinds of support from them to commit crimes. Collusion here involves committing criminal acts with a foreign country or with external elements. "Collusion with a foreign country or with external elements to endanger national security" should involve misdeeds done deliberately. Article 29 lists five acts that may constitute this crime.

Just now you asked what the term "provoking hatred" refers to. First, I would like to say that the word "hatred" or the term of "provoking hatred constitutes a crime" is taken from the laws of Hong Kong. There is the Crimes Ordinance in Hong Kong's existing laws. Article 9 and Article 10 of the Crimes Ordinance stipulate that it may constitute a crime to incite hatred among residents and against the government. This shows that, in the process of enacting this law, the actual situation of Hong Kong, the provisions of Hong Kong's existing laws and some concepts and customs of Hong Kong's common laws, were fully considered and adopted as much as possible. Of course, a general sense of "hatred" will not constitute a crime. In this law, it is clearly stipulated that "provoking hatred" which may cause serious consequences may constitute a crime. For example, inciting the whole society's hatred against the government by spreading rumors may constitute a crime, similar to a case in the turbulence over the amendment bill last year that impressed me deeply. Last year, there was a rumor about the killing of people at the Prince Edward Station in Hong Kong, which led to social discontent against the Hong Kong police. It was groundless. Some rumors may be made against the central government, and those malicious ones that cause serious consequences may constitute a crime. Acts or activities of colluding with foreign forces to endanger national security can be treated and punished as a crime. For example, in last year's turbulence over the amendment bill, some people went abroad to implore foreign governments to enact laws to impose sanctions on the Chinese government. This was intentional, and can be punished as a crime if it causes serious consequences.

China Daily:

Article 23 of the Basic Law of the HKSAR stipulates that the HKSAR shall enact laws on its own to prohibit any act and activity endangering the national security. After the Standing Committee of the NPC completes this particular piece of legislation, will the HKSAR still need to complete the legislative process in regard to Article 23? How should the relationship between Article 23 and relevant laws passed by the NPC Standing Committee, as well as the existing laws in Hong Kong be handled? Thank you.

Shen Chunyao:

Article 23 of the Basic Law of Hong Kong is the most well-known clause both in Hong Kong and on the mainland. Therefore, when our country is taking legislative measures this time, including decisions made by the NPC and the promulgation of laws by the NPC Standing Committee, many people are concerned about Article 23. This issue has been studied seriously in the process of forming, proposing and promoting the work plan of "decision plus legislation." Article 3 of the NPC Decision on Establishing and Improving the Legal System and Enforcement Mechanisms for Safeguarding National Security in the Hong Kong Special Administrative Region adopted at the third session of the 13th NPC made clear requirements. And Article 7 of the newly adopted Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region has also clearly stipulated that HKSAR shall complete, as early as possible, legislation for safeguarding national security as stipulated in the Basic Law of Hong Kong and shall refine relevant laws.

Just now, Mr. Zhang mentioned 23 years, which is a long period of time indeed. Article 23 also happens to relate to the same number. So, the requirement for HKSAR to complete the legislative process as early as possible is very clear. HKSAR's chief executive and the HKSAR government have also made clear statements that relevant laws will be refined after the promulgation of national laws. I would like to explain the following situations, as many Chinese people including Hong Kong compatriots are very concerned about.

First, what does Article 23 stipulate? It stipulates that HKSAR should enact laws on its own to prohibit seven types of acts, including treason, secession, sedition, subversion against the Central People's Government, and theft of state secrets, as well as two types of activities related with foreign political organizations or bodies. Article 6 of the decision adopted by the third session of the 13th NPC authorized the NPC Standing Committee to enact relevant laws to effectively prevent, suppress and impose punishment for four types of acts and activities endangering national security, namely, secession, subversion of state power, organization and perpetration of terrorist activities, and collusion with a foreign country or with external elements to endanger national security in relation to the HKSAR. So, Article 23 lists seven types of acts and activities, whereas the national security law stipulates four. Secession and subversion are included in both. As for the elaboration of subversion, it is "subversion of the Central People's Government" in Article 23; while it is "subversion of state power" in the national security law, whose connotation is more extensive and comprehensive.

Second, the two are very different. In addition to the four categories of crimes endangering national security that are punishable, the newly introduced law also includes a lot of other important content. I just mentioned that the newly introduced law displays three types of legal norms, namely, substantive law, procedural law and organic law. To expand my interpretation a little bit, I would say the content has "two levels," including institutional arrangements at the special administrative region level and at the national level. And "two aspects:" one is to establish and improve the legal system, and the other is to establish and improve the enforcement mechanisms. Namely, the two aspects of the legal system and the enforcement mechanisms. The legal norms of substantive law, procedural law and organic law I just mentioned are all included. That is to say, the newly introduced law contains much broader content than that originally envisaged for Article 23 of the HKSAR Basic Law.

Third, it is not a replacement. Neither the Decision of the NPC nor the law promulgated by the NPC Standing Committee can replace the provisions of Article 23 in the HKSAR Basic Law that require the HKSAR to make legislation on its own.

Fourth, the HKSAR shall perform its duties of safeguarding national security, including completing the relevant legislation as stipulated in the Basic Law as soon as possible. There is also a sentence clearly stated in the law, "refine relevant laws," which means that the establishment and improvement of the legal system for safeguarding national security at the level of the HKSAR may not be limited to the legislation as stipulated by the Article 23. Last year, there was a case in the HKSAR, which was based on the current Societies Ordinance and the Crimes Ordinance. There are still some local laws in Hong Kong that are also related to national security. Therefore, improving the legal system at the special administrative region level certainly includes enacting the legislation required by Article 23 of the Basic Law as soon as possible, as well as other aspects.

Finally, there is one more important point. Any legislation of the HKSAR to safeguard national security and its implementation must not conflict with the NPC's Decision and the law newly adopted by the NPC Standing Committee, which are at the national level. These are important institutional arrangements. The third session of the 13th NPC, and the 19th and 20th sessions of the Standing Committee of the 13th NPC have made clear judgments: The Decision and the law are in compliance with China's Constitution and the HKSAR Basic Law. The law is also in compliance with the spirit of the NPC's Decision. Therefore, this is an overall and closely-related institutional arrangement that should be able to be effectively implemented.

Hong Kong Ta Kung Wen Wei Media Group:

The law on safeguarding national security in Hong Kong stipulates that a resident of the Region who stands for election or assumes public office shall confirm in writing or take an oath to uphold the Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China and swear allegiance to the Hong Kong Special Administrative Region of the People's Republic of China in accordance with the law. It also stipulates that a person who is convicted of an offence endangering national security by a court shall be disqualified from standing as a candidate in the elections and from holding any public office upon conviction. Is this to disqualify the opposition before the Legislative Council election in September? Will opposition candidates lose their eligibility for opposition to the law on safeguarding national security in Hong Kong? Does allegiance to the HKSAR mean allegiance to the People's Republic of China? Thank you.

Zhang Xiaoming:

The public servants' oath and allegiance system is standard international practice. The public servants' oath and allegiance system stipulated in Article 6 of the law on safeguarding national security in Hong Kong refer to the provisions of public servants' oath and allegiance in Article 104 of the Basic Law. There are two differences between what is in the law on safeguarding national security in Hong Kong and Article 104 of the Basic Law. First, the scope of sworn allegiance has been broadened, and it is not about just a few objects defined by the Basic Law, including the chief executive, principal officials, members of the Executive Council and the Legislative Council, judges of the courts at all levels and other members of the judiciary. The new scope is not limited to these categories of people, but includes all public servants. Second, the national security law clearly stipulates that people who assume public office through election shall confirm in writing to uphold the Basic Law of the HKSAR of the People's Republic of China, and are willing to swear allegiance to the HKSAR of the People's Republic of China when they stand for election. In fact, the HKSAR government adopted this approach back in 2016. Whether you stand in the Legislative Council election or the district council elections, you must sign a document making such a commitment. Now, Hong Kong's national security law actually legalizes practices already effective in the region. This is entirely reasonable and very necessary.

I need to add one point here. Whether it is the oath and allegiance system stipulated in Article 6 of the law on safeguarding national security in Hong Kong or the content of the allegiance swearing stipulated in Article 104 of the Basic Law, the words "allegiance to the HKSAR of the People's Republic of China" mentioned there undoubtedly include the meaning of allegiance to the country. The reasoning for this is also obvious and is determined by the legal status of the HKSAR. It is an inseparable part of the People's Republic of China and a local administrative region enjoying a high degree of autonomy in the People's Republic of China. Of course, the objects of public servants' oaths of allegiance should first include the state. You cannot separate the HKSAR from the People's Republic of China, and understand the oath of allegiance merely as allegiance to the HKSAR. I am not saying this pointlessly: some people in Hong Kong do have such an opinion. There is a legal basis for my understanding. In addition to my interpretation of some basic provisions of the Basic Law just now, the NPC Standing Committee previously explained the provisions of Article 104 of the Basic Law concerning oaths in November 2016. The explanation made it clear that swearing allegiance refers to the legal commitments to the People's Republic of China and its HKSAR, which is legally binding. It clearly clarifies the two subjects.

As for your question about whether the national security legislation will be used to provide legal basis for disqualifying opposition candidates in September's Legislative Council election in Hong Kong, I have to say, such speculation about the purpose of the legislation is of an ultra-utilitarian and short-sighted nature. The fundamental purpose of the central government's legislation of such an important law is to safeguard China's national security, restore stability in the HKSAR, and ensure the sound and sustained implementation of the "one country, two systems" principle, which is a much higher purpose than all the speculations. 

You have just asked whether opposition candidates would be disqualified due to their negative attitude to the national security law for Hong Kong. This question needs to be seriously considered. However, I believe that the HKSAR government will provide a specific definition in this regard in accordance with the Basic Law of the HKSAR, the national security law for the HKSAR and relevant provisions of other laws in force there. I would like to stress that the national security legislation doesn't target the opposition or the "pan-democratic" camp in the HKSAR as a hypothetical enemy. This is not our point. The legislation targets only a very few criminals that seriously undermine national security, and does not focus on the entire opposition camp. Hong Kong is a pluralistic society with diverse political views. The implementation of the "one country, two systems" in Hong Kong already speaks volumes regarding the political tolerance of the central authorities. Different political views, including those not favoring the government's approach, can still exist. Comrade Deng Xiaoping once said that, after the return of Hong Kong, the local people could still condemn the CPC if they so wished; however, they should not take any actions or turn Hong Kong into an anti-mainland base under the pretext of promoting "democracy". That is to say, there are bottom lines and boundaries that cannot be crossed in regard to the "one country, two systems". A capitalist society also has political game rules and bottom lines. Therefore, all parties should abide by the rules and avoid breaching established bottom lines. In this regard, I think the opposition in Hong Kong should undertake reflection and make appropriate adjustments.

Xinhua News Agency:

According to the law on safeguarding national security in the HKSAR, the central government have jurisdiction over four categories of crimes endangering national security. What principles and approaches will the central government follow when exercising jurisdiction in regard to such cases? How will the central government and the HKSAR define their respective jurisdiction in this regard?

Shen Chunyao:

This question is very important. Article 55 of the national security law makes stipulations concerning the circumstances under which the central government will exercise jurisdiction over cases concerning offences endangering national security as defined under this law. First, it is the duty of the HKSAR, under the constitution, to safeguard national security. The law stipulates that the HKSAR establishes the Committee for Safeguarding National Security. Its nature is also defined. Article 12 stipulates that the committee assumes primary responsibility for safeguarding national security in the region "under the supervision of, and accountable to, the Central People's Government". This is the overall requirement to be followed in exercising jurisdiction over handling and trial of cases. Article 40 stipulates that the HKSAR has jurisdiction over cases concerning offences as defined under this law, which is one of the general provisions. However, this also includes the following proviso: "except under the circumstances specified in Article 55 of this law" that makes stipulations concerning the specific circumstances under which the Office for Safeguarding National Security of the Central People's Government in the HKSAR will exercise jurisdiction over a case involving an identified offence under this law. What are the specific circumstances? Under the law, the office exercises jurisdiction over a case concerning any offence deemed to endanger national security, in the following circumstances: if the case is complex due to the involvement of a foreign country or external elements, thus making it difficult for the region to exercise its jurisdiction; a serious situation occurs where the government of the region is unable to effectively enforce this law; or a major and imminent threat to national security has occurred. Realistically speaking, we are unwilling to see Hong Kong facing such difficulties and major and imminent threats, but institutional building must take all risks and factors into consideration.

Under these specific circumstances, the initiating procedure of the jurisdiction of the office for safeguarding national security in regard to cases has very strict and specific stipulations. What procedures should be followed? First, the Government of the Hong Kong Special Administrative Region or the office itself shall make a request. Second, the request, no matter who makes it, will be approved by the Central People's Government. Following such procedures, and only under the three circumstances already mentioned, can the jurisdiction of the central authorities over relevant cases be initiated and exercised. When the office exercises jurisdiction over a case concerning any offence endangering national security, the enforcement of this law consists of a series of related links. The office first initiates an investigation into the case, the Supreme People's Procuratorate designates a prosecuting entity to prosecute it, and the Supreme People's Court shall designate a court to adjudicate it. The Criminal Procedure Law of the People's Republic of China and other related national laws shall apply to procedural matters, including those related to criminal investigation, examination and prosecution, trial, and execution of penalty. Overall, this is a complete set of law enforcement and judicial activities, which are stipulated in Articles 55, 56 and 57 of the law.

It is important to note that the Office for Safeguarding National Security of the Central People's Government in the HKSAR and the relevant national authorities only exercise jurisdiction over a very small number of cases that may leave the country's national security in grave peril, as stipulated in the law. Although these cases are rare, the legal institutional arrangements must exist. This is also the manifestation of constitutional order of the HKSAR as mandated by the Constitution and the Basic Law, and the central government's overall jurisdiction over HKSAR. It supports and strengthens the effective law enforcement and judicial activities of the law enforcement and judicial authorities of the HKSAR. It can help prevent the possible situation or the situation that may invoke Article 18(4) of the Basic Law of Hong Kong, where a "State of Emergency" is declared. Once that happens, the situation would be pretty serious. The central government exercising jurisdiction over certain cases under certain circumstances can help avoid the severe situation, as stated under Article 18(4) of the Basic Law. So that we can try to avoid such severe situations and safeguard national security in the HKSAR with low-intensity approach. In conclusion, this institutional arrangement is an integral part of the legislation.

The Times:

What measures in the national security law can guarantee judicial independence in Hong Kong? The national security law stipulates that the chief executive designates judges. Does this violate the spirit of judicial independence? Thank you.

Shen Chunyao:

The Constitution of China clearly stipulates that the people's courts and the people's procuratorates exercise power independently, free from interference by any administrative organ, public organization or individual. This is the clear provision on the independent exercise of judicial power and procuratorial power in the country's rule of law. There are also very clear provisions in the Basic Law of the HKSAR. It is clearly stipulated under Article 85 of the Basic Law that the courts of the HKSAR shall exercise judicial power independently, free from any interference. Members of the judiciary shall be immune from legal action in the performance of their judicial functions. The Basic Law also has clear provisions for prosecution. Article 63 clearly stipulates that the Department of Justice of the HKSAR shall control criminal prosecutions, free from any interference. Judicial independence is clearly stipulated and implemented in accordance with the Constitution, the Basic Law, and other relevant laws.

Just now, you have mentioned the judges who handle cases concerning offence endangering national security. There is a relevant provision in the national security law, which is also an institutional rule. Under Article 44 of the national security law, the chief executive shall designate a number of judges from the magistrates, the judges of the District Court, the judges of the Court of First Instance and the Court of Appeal of the High Court, and the judges of the Court of Final Appeal to handle cases concerning offence endangering national security. It will not affect the independent exercise of judicial power by court judges and is an issue in different dimensions.

Designating judges has the following implications: (1) Judges to be designated will be existing judges, not other people who are not judges. (2) The designated judges are responsible for cases concerning offences endangering national security. Other judges, not so designated, will still be able to handle other cases. The types of judicial cases are quite diverse. Cases concerning offence endangering national security are only one of them. (3) Designating a number of judges from the magistrates, the judges of the District Court, the judges of the Court of First Instance and the Court of Appeal of the High Court, and the judges of the Court of Final Appeal means making a list within a certain range. In specific trials, the judges will be chosen according to the arrangements of existing provisions. (4) The law clearly stipulates that before making such designation, the chief executive may consult the Committee for Safeguarding National Security of the Hong Kong Special Administrative Region and the Chief Justice of the Court of Final Appeal. (5) Speaking specifically about the trial of the case, it is still an independent trial without any interference. Therefore, such an institutional arrangement reflects the HKSAR's constitutional responsibilities, especially the main responsibility of maintaining the national security of the Committee for Safeguarding National Security of the Hong Kong Special Administrative Region. At the same time, it takes the actual situation of Hong Kong's judicial and judge system into consideration. It would also be conducive to improving the efficiency of trials, as the designated judges on the list may have rich experience and be good at handling such cases, which could help unify judgment standards because this is a type of case and this type of case may have relevance and its characteristics.

Take the characteristic of cases of "committing secession" and "subverting the state power." We can't let these offences happen. If the country is divided and the state power is subverted, how can you prosecute the crimes? This is a characteristic of this type of crime. The state power of the People's Republic of China, be it the Central People's Government or the local government authorities at all levels, including the HKSAR government -- the whole country will never tolerate the offences of secession and subversion. We cannot allow criminals to achieve such an ultimate goal. This is the characteristic of cracking down on such crimes. We determine the legal standards which apply to the relevant crime based on the characteristics of such cases. Therefore, the system of designating judges is conducive to formulating a relatively unified standard of judgment and making clear the rules and norms of specific applications of the law.

CGTN:

Article 66 of the HKSAR national security law states that this law shall come into force on the date of its promulgation. Does this mean that crimes endangering national security will not be prosecuted if they were committed before the law is promulgated? Thank you.

Zhang Xiaoming:

Concerning retroactivity, the HKSAR national security law is consistent with the common practices in international criminal laws, that is, the law is not retroactive. It is clear and also shows that the law follows the principle of modern rule of law. Meanwhile, it must be noted that the laws in force in the HKSAR, including the Crimes Ordinance, the Public Order Ordinance, the Societies Ordinance, and the Official Secrets Ordinance, contain provisions concerning national security. These provisions shall be applied to punish crimes that have already been committed which endanger national security. Article 8 of the HKSAR national security law reads: "In order to safeguard national security effectively, the law enforcement and judicial authorities of the Hong Kong Special Administrative Region shall fully enforce this Law and the laws in force in the Region concerning the prevention of, suppression of, and imposition of punishment for acts and activities endangering national security." This shows that it is the legal responsibility of administrative, law enforcement and judicial authorities of the HKSAR to punish acts and activities endangering national security by applying the laws in force in the HKSAR. 

Of course, the function of a criminal law is not limited to the punishment of crimes, but more importantly, it shall be applied to prevent crimes. Therefore, we sincerely hope that after the HKSAR national security law is promulgated, the Hong Kong society can seriously study and understand this law, and enhance the national consciousness, and the awareness of national security and the rule of law. In particular, the missed lessons in this regard shall be made up in school education. We hope that all young people in the HKSAR can love both our country and the region, observe disciplines and obey laws, and have a promising and bright future.

Phoenix TV:

Since the HKSAR national security law came into force, people have been concerned about whether the rights and freedoms of Hong Kong residents will be restrained in the prevention of, suppression of, and imposition of punishment for acts and activities endangering national security in the HKSAR. Will the law conflict with some international covenants and local laws on human rights in the HKSAR? Thank you.

Shen Chunyao:

In studying and drafting laws, China attaches great importance to the principle that human rights shall be respected and protected. The HKSAR and the whole country have placed great emphasis on promoting all-round progress on human rights. The Constitution of the People's Republic of China clearly states that the People's Republic of China shall practice law-based governance and that the state shall respect and protect human rights. Relevant provisions are also found in other Chinese laws such as the Criminal Law of the People's Republic of China and the Criminal Procedure Law of the People's Republic of China. It is also clearly defined in the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region and placed in a prominent position. The law's General Principles, which govern the full text, clearly state that human rights shall be respected and protected in safeguarding national security in the HKSAR and the principle of the rule of law shall be adhered to.

Important principles of criminal law shall be implemented in handling cases and imposing punishment for offences that endanger national security. These are clearly defined in the General Principles section of the HKSAR national security law, including the principle of legality, which is also known as "no crime without the law and no punishment without the law." A person who commits an act which constitutes an offence under the law shall be convicted and punished in accordance with the law. No one shall be convicted and punished for an act which does not constitute an offence under the law. Another very important principle is presumption of innocence. The law stipulates that the rights in judicial proceedings that a criminal suspect, defendant, and other parties in judicial proceedings are entitled to under the law shall be protected. The principle of protection against double jeopardy is also reflected in the law, where it is clearly prescribed that no one shall be liable to be tried or punished again for an offence for which he or she has already been finally convicted or acquitted in judicial proceedings. All of these important principles are stipulated in the General Principles section of the law.

Moreover, respect for and protection of human rights shall not be limited to criminal proceedings. The law also clearly stipulates that the rights and freedoms enjoyed by HKSAR residents under the Basic Law of the HKSAR and the provisions of the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights as applied to Hong Kong shall be protected in accordance with the law. Hence, the law is in line with the relevant provisions and principles of the Basic Law of the HKSAR and protection of human rights under the law is not just limited to criminal proceedings, but also widely covers rights and freedoms of speech, of publication and of assembly.

To safeguard national security, it is necessary to impose punishment for offences endangering it in accordance with the law. Law enforcement and judicial authorities shall prevent and suppress such offences according to law and those who are involved in them shall be investigated for criminal responsibility in accordance with relevant provisions of the criminal law. Therefore, many people are concerned about the impact on human rights, especially in regard to personal freedom, right to free expression, including press and publication work, freedom of assembly, and so on. Any right has clear boundaries and their scope is prescribed by law. As Mr. Zhang Xiaoming mentioned, "one country" has a bottom line, and "two systems" has a certain boundary. It is not permitted to breach the bottom line and the boundary required by rule of law. That is the case for the HKSAR, and the same also goes for China and any other country in the world. Rights and freedoms should be fully exercised, but within the scope of the law and in accordance with legal requirements. People who breach the bottom line and challenge its scope should bear corresponding legal responsibility. In terms of the bottom line and requirements of safeguarding national security, the relevant provisions of the International Covenant on Civil and Political Rights are very clear, fully guaranteeing the exercise of these rights and freedoms while stipulating the exercise of them should be within the scope as prescribed by law. Some people have wondered whether legal provisions are arbitrarily introduced. It does not work like that. Legal provisions have requirements and scope. For example, in the areas of national security, public order, public health, and even social decency, there are limits, a distinct bottom line and boundaries that cannot be crossed. Absolute rights and freedoms are impossible. 

Today, our friends from the press here are wearing masks, except for the few of us. In order to prevent and control COVID-19, we acted quickly in January. One of the measures taken, which seems simple but actually is of great importance, is that everyone is required to wear a mask. However, some countries don't see it that way, and they think it limits people's freedom and rights. I just take this as an example, since everyone has personal experience in regard to epidemic prevention. Likewise, there are boundaries and requirements for national security and public order. The situation varies from country to country. Just now, Mr. Zhang Xiaoming talked about the United States. Americans have the freedom to carry guns; however, is this true in other countries of the world? During the formation of China's newly adopted Civil Code, there were opinions calling for the legal recognition of same-sex marriage. We were talking about heterosexual marriage. Some might say same-sex marriage has been legalized in a certain country, and that might be possible. However, rights and freedoms have boundaries, and the situation varies from country to country. So, in safeguarding national security in the HKSAR, there are certain limits, a bottom line and boundaries, and we must strive to achieve a balance. In safeguarding national security, human rights must be respected. To respect human rights, national security must be maintained. These two are basically consistent and complement each other.

Lianhe Zaobao:

As China enacted the law on safeguarding national security in the HKSAR, the United States recently announced a string of sanctions, including restrictions on visas for Chinese officials and abolishing special treatment for Hong Kong. How will China respond? What specific countermeasures will be taken? There are also concerns that a financial war may break out between the two countries due to the escalating sanctions imposed by the U.S. and China's countermeasures, which may undermine Hong Kong's status as a financial center. What is China's response to that? Thank you. 

Zhang Xiaoming:

I have already stated China's attitude towards the so-called sanctions when answering questions from TASS news agency just now. Some people in the United States do like to stretch their hands too far. If they continue such bullying actions, if they don't think they have enough chaos at home, if they don't care that the so-called sanctions may do more damage to themselves than to others, if they want to shift the crisis onto others and shirk their responsibilities, then they should certainly go ahead and try. They will just give us a chance to demonstrate our determination and ability to fight back in self-defense. In fact, everyone may have noticed that U.S. Secretary of State Mike Pompeo and U.S. Secretary of Commerce announced several so-called sanctions in the past two days, and China has also decided to impose visa restrictions on U.S. individuals who have acted maliciously on Hong Kong-related issues. As an old saying goes in China, we will "answer blows with blows." As long as the United States takes actions, the Chinese government and the HKSAR government are bound to react with countermeasures. Relevant measures will be taken according to circumstances.

The HKSAR's special economic status, including its status as an international financial center, has been formed over a long period, and forged through the hard work of several generations of Hong Kong people. Its status has been widely recognized by international society and guaranteed by the Basic Law, and certainly cannot be plundered by any country or group. We are not worried about maintaining its international status, because its position as an international financial center, and its prosperity and stability, basically depend on two factors: whether Hong Kong's own advantages in regard to its business environment and financial system will be weakened, and whether the momentum of China's economic development and the central government's support for Hong Kong will continue. We have confidence in these two factors, and so we have full confidence in Hong Kong's future.

Guo Weimin:

Today's press conference concludes here. Thank you all！

In case of any dispute over a discrepancy, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Lin Nianxiu, deputy director of the National Development and Reform Commission

Zou Jiayi, vice minister of finance 

Wang Shouwen, vice minister of commerce, deputy China international trade representative 

Pan Gongsheng, deputy governor of the People's Bank of China and head of the State Administration of Foreign Exchange

Li Guo, deputy head of the General Administration of Customs

Liu Cigui, secretary of the CPC Hainan Provincial Committee and chairman of the Standing Committee of the People's Congress of Hainan Province

Shen Xiaoming, deputy secretary of the CPC Hainan Provincial Committee and governor of Hainan 

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

June 8, 2020

Hu Kaihong:

Good morning, ladies and gentlemen. Welcome to this press conference held by the State Council Information Office. A master plan for the Hainan Free Trade Port (FTP) was officially released on June 1. The plan drew considerable public attention and is very important. Today, we are pleased to invite Liu Cigui, secretary of the CPC Hainan Provincial Committee and chairman of the Standing Committee of the People's Congress of Hainan Province; Shen Xiaoming, deputy secretary of the CPC Hainan Provincial Committee and governor of Hainan; Lin Nianxiu, deputy director of the National Development and Reform Commission; Zou Jiayi, vice minister of finance; Wang Shouwen, vice minister of commerce, deputy China international trade representative; Pan Gongsheng, deputy governor of the People's Bank of China and head of the State Administration of Foreign Exchange; and Li Guo, deputy head of the General Administration of Customs. They will brief you on the plan and then take your questions. First, I will give the floor to Mr. Lin.

Lin Nianxiu:

Ladies and gentlemen, friends of the media, good morning to you all. The construction of a free trade port in Hainan is a major reform and opening-up initiative personally planned, deployed and promoted by General Secretary Xi Jinping. The Central Committee of the Communist Party of China (CPC) has made this strategic decision with an eye on the domestic and international situation, and with in-depth research, overall consideration and scientific planning. Recently, at the critical moment when the construction of the Hainan FTP is about to start, General Secretary Xi Jinping gave important instructions to point out the direction for building the Hainan FTP. On June 1, the CPC Central Committee and the State Council issued a master plan for its construction. The following is the main contents of the plan, which I will make to you in the light of the important instructions of General Secretary Xi Jinping. 

The general plan can be divided into three key points. First, it adheres to the Party's centralized and unified leadership, and insists on the system of socialism with Chinese characteristics; second, it aligns with the high-standards of international economic and trade rules, prioritizing the innovation of institutional integration and promoting the smooth flow of production factors; and third, it highlights ensuring enduring progress. I would like to sum it up very simply by saying that it is all about right direction, innovation of institutional integration, liberalization and facilitation, and a step-by-step approach.

The main content of the plan can be summarized as "6+1+4".

"6" means liberalization and facilitation on six fronts, including trade, investment, cross-border capital flows, the movement of people, the movement of transport and the secure and orderly flow of data. Centering round these six aspects, a series of institutional arrangements have been made in the plan. I will give you a brief introduction.

In terms of trade liberalization and facilitation, the arrangement will feature zero tariff for the trading of goods and relaxed restrictions on both market access and business operations for trading services. 

In terms of investment liberalization and facilitation, to put it simply, the market access of Hainan will be significantly expanded to further boost the vitality of various market entities.

In terms of cross-border capital flow, the plan emphasizes that financial services must serve the real economy. Based on the liberalization and facilitation of trade and investment, capital projects will be launched in stages to promote free and convenient capital flow of Hainan FTP and overseas in an orderly manner.

In regards of the free and easy entry and exit of people, we have implemented a more open talent and residency policy for attracting talent in high-end industries, with the aim of creating a highland where talents can gather.

With regard to the freedom and convenience of transport exchanges, a highly liberal and open transport policy will be implemented to promote the construction of a new western land-sea corridor and an international shipping and aviation hub.

In terms of the secure and orderly flow of data, we will expand openness in the data sector, and cultivate and develop the digital economy on the premise that the data flow is secure and under control.

"1" refers to the building of a modern industrial system. Particular emphasis is placed on highlighting Hainan's advantages and characteristics, vigorously developing tourism, modern service industries and high-tech industries. We will also be further consolidating the foundations of the real economy and strengthening economic innovation and competitiveness.

The "4" is to strengthen the institutional arrangements in the four areas of taxation, social governance, rule of law and risk prevention and control. 

The first is to gradually establish a tax system compatible with a high-level free trade port in accordance with the principles of zero tariffs, low tax rates, a simplified tax system, strong rule of law, and a phased implementation.

Second, efforts will be made to promote the reform of government agencies and the transformation of government functions, and to build a governance system for free trade ports that is systematic, complete, scientifically standardized and effectively operated.

Third, a free-trade port rule of law system based on the Hainan FTP law and consisting of local regulations and an economic settlement mechanism for commercial disputes will be established to create a world-class free-trade port rule of law environment.

Fourth, effective measures have been formulated and implemented to prevent and mitigate major risks in the areas of trade, investment, finance, public health and ecology, so as to firmly hold the line against systemic risks.

There are two phases in implementing the master plan — laying the foundation and carrying it out in an all-round manner.

The first phase runs from now until 2025, during which the main work involves laying the foundation and making preparations. The tasks of this phase include highlighting liberalization and facilitation of trade and investment, orderly promoting opening-up on the basis of effective supervision, yielding early results by promoting the convenient and efficient flow of various production factors, and launching the island-wide special customs clearance operation in due course. We will carry out relevant work in a timely manner and strive to make breakthroughs within around three years, so as to lay a solid foundation for launching of the special customs clearance mechanism.

The second phase, which will run until 2035, involves promoting the implementation of a set of free trade port policies in an all-round manner. The tasks during this phase include further optimizing and improving opening-up policies and relevant institutional arrangements; realizing free and convenient trade, investment, cross-border capital flow, personnel movement, and transportation; achieving the safe and orderly flow of data; ensuring a complete system of laws and regulations, a modern industrial system and a modern social governance system are basically formed; and creating a new highland of open economy for China.

In the next step, guided by the spirit of General Secretary Xi Jinping's important instructions, the NDRC will work with Hainan province and relevant departments to give priorities to important links and key areas in line with the requirements of the master plan, adhere to the principle that regulatory streamlining can only serve its purpose when supported with enhanced compliance oversight, implement the plan in steps and phases with all-out efforts in a steady and sound manner, and make a big push to ensure that various policies and measures can come into effect and produce positive results as soon as possible, so that we can build Hainan into a high-quality free trade port with high standards. That concludes my introduction. Thank you.

Hu Kaihong:

Thank you, Mr. Lin. I will now give the floor to Mr. Liu.

Liu Cigui: 

Ladies and gentlemen, friends, good morning. First, thank you for your interest in and support of Hainan's comprehensive deepening of reform and opening-up. I would like to take this opportunity to extend my sincere thanks to all the global investors and various sectors of society.

Building the Hainan FTP is an important national strategy designed, arranged and promoted by General Secretary Xi Jinping. It is a major measure to show that "the door of China's opening-up will not close, but will only open wider and wider." Hainan is the southernmost province of China. It has been supported by the CPC Central Committee and the country's people ever since it became a province and a special economic zone (SEZ) in 1988. On April 13, 2018, General Secretary Xi Jinping delivered an important speech at a conference celebrating the 30th anniversary of the island province and SEZ, announcing the decision to support developing Hainan into a pilot free trade zone and gradually into a free trade port with Chinese characteristics. Hainan was positioned as a pilot zone for comprehensively deepening reform and opening-up, a national demonstration area for the construction of ecological civilization, an international tourism and consumption center, and a zone offering services and support for the country's major strategies. During the past two years, we have pushed forward the high-standard construction of the FTZ in strict accordance with a series of important deployments by General Secretary Xi Jinping and the CPC Central Committee. As such, the development of the FTZ has laid a solid foundation for the building of a free trade port.

We are adhering to high standards and high quality in building the pilot FTZ, and have identified 18 pivotal projects. Guided by the central government's "1+N" policy system, we have refined and promoted its implementation in accordance with the situation in Hainan. Over the past two years, we have laid a solid foundation for the coordinated development across the island in terms of constructing infrastructure for the "five networks" of optical network, power grid, gas network, road network and water network. We held a plenary session to study and implement the important speech delivered by General Secretary Xi Jinping, during which an important decision was made to attract one million talents to Hainan. At the same time, we are planning to promote the Smart Hainan plan. The development of Hainan requires high standards, which means we should have a high starting point. With the support of the NDRC and other departments, the plan has already been approved by the central government.

Liu Cigui:

We highly value institutional innovations in the past two years. We released 77 institutional innovations successively, many of which were national firsts. We formulated 69 measures on business environment meeting World Bank standards. Now, Hainan has made remarkable achievements in streamlining approval procedures, allowing all of them to be handled on a single online platform, with a single approval seal, and at a single window. At the same time, we have strictly controlled the real estate sector. Hainan did not develop the sector by building as much as was wanted and thus turning itself into a promotional vehicle for the real estate sector. In view of the limited land available and drawing on the lessons of history, Hainan should not lack variety when developing a modern industrial system. In the past two years, we have vigorously attracted foreign investment and key market players, with an additional 444,000, up 65%, compared to the period before the April 13 speech in 2018. There are 572 new projects worth over 100 million yuan, registering a total investment of 582.8 billion yuan. Among them, 125 projects are worth over 1 billion yuan, registering a total investment of 443.1 billion yuan; there are even five projects worth over 10 billion yuan. While undertaking all this development, we have attached great importance to environmental protection. Any regulatory streamlining can only serve its purpose when supported with enhanced compliance oversight. To this end, we have established a sound social governance system, under which customs across the island would be closed after implementing zero tariffs at the free trade port, mainly aiming to prevent smuggling. We have been working on prevention in these past two years, and building prevention and control zones for nearshore, offshore, coastline and island areas. The master plan for the free trade port has been released, and we will convene the eighth plenary session of the seventh provincial Party committee shortly to fully implement the important instructions of the General Secretary and the master plan released by the central authorities. It will focus on how to put it in place, and how to make every effort count. Here are a few key points:

First, while always adhering to the Party's leadership, developing a comprehensive leadership, over the construction of the free trade port. We will firmly pursue the correct direction in all aspects of construction, take the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as our guide, further strengthen our consciousness of the need to maintain political integrity, think in big-picture terms, follow the leadership core and maintain constant alignment with the central Party leadership, stay confident in the chosen path, theory, system, and culture of socialism with Chinese characteristics, uphold General Secretary 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, and resolutely ensure the construction to be pushed forward always under the leadership of the Party Central Committee. Under the direct leadership of the leading group overseeing Hainan's comprehensive reform and opening up, we have broken down the tasks in the plan, worked out timetables and the paths to be followed, specified responsibilities at different levels, and carried out activities across the province calling for contributions to the construction funds. Our motto is: dare to venture, dare to try, dare to be first, and work hard, fully expressing the spirit of the special economic zone. We will try to make each day really count to ensure that all policies are well put in place.

Second, we are committed to adhering to a high-level opening up policies. To attract global investors to invest in Hainan, we will pay more attention to introducing foreign capital and overseas talents, and fully implementing the policies of the free trade port. We will give full play to integrated institutional innovation. The high-standard and high-quality construction of Hainan Free Trade Port requires us to liberate our minds at the systemic grassroots level, and constantly innovate and reform. Of course, we will not launch a policy until it becomes mature, so that we can develop on a steady and sustained course through constant efforts, because the policies of the entire free trade port should form a complete, science-based and efficient whole. We will focus on trade and investment liberalization and facilitation, and set up various systems in an integrated manner, rather than dealing from a single perspective . These systems will include the management system as well as laws and regulations. In particular, it will help to address the relationship between easy access and tight regulation, promote the free flow of production factors and prevent or mitigate various risks, so as to achieve a high level of openness, and make Hainan Free Trade Port a leading light in China's reform and opening up. We will always give top priority to the interests of the people. Building a free trade port will bring a sense of happiness and gain to 9.4 million people in Hainan, as well as the entire national population. Therefore, when constructing the relevant urban and rural systems, especially when we aim for a moderately prosperous society in all respects this year, Hainan must ensure nobody is left behind. We should make investors feel that, through this process, they are here in Hainan to share the dividends of Hainan Free Trade Port.

Third, everything we undertake will fully adhere to bottom-line thinking, and doing a good job in preventing and controlling various risks. We will draw on lessons from the ups and downs experienced by Hainan in the past, uphold the premise that "any regulatory streamlining can only serve its purpose when supported by enhanced compliance oversight," and strengthen the awareness of risk prevention and mitigation. We will carry out science-based anticipation, targeted response, and proper management and control, so as to prevent and mitigate risks in trade and investment, personnel entry and exit, capital flow, ecology, and public health, and put the construction of the free trade port on a stable and sustained course.

Dear friends, Hainan Free Trade Port invites global investors and all kinds of talents to invest and operate business, actively participate in its construction, and share the development opportunities and fruits of China's reform and opening up. Thank you.

CCTV:

It is often said that human resources are most in-demand in the 21st century. Just now, you talked a lot about the demand for talented people. There is an urgent need for human resources in Hainan as it develops itself into a free-trade port. What specific measures will Hainan introduce to attract competent personnel to participate in its free trade port development? Thank you.

Liu Cigui:

Thank you for your question. Hainan has been at the forefront of China's reform and opening up endeavor for more than three decades. Around 100,000 people once crossed the Qiongzhou Strait to start businesses in Hainan. However, Hainan, formerly an administrative region of Guangdong, became a province in 1988. Therefore, human resources are inadequate to meet the needs in its development.

As I introduced just now, we have launched an action plan of bringing 1 million talented people to settle in Hainan by 2025. The Organization Department of the CPC Central Committee and other government departments have offered strong support for Hainan in attracting competent personnel. In recent years, about 200 officials, who served in leadership teams of other places, have been selected and transferred to work in Hainan for two to three years in the leadership of governments and departments at provincial，municipal and county level. This represents an effort of central government departments to firmly implement the important speech by General Secretary Xi Jinping at the celebration of the 30th anniversary of the founding of Hainan province and the Hainan Special Economic Zone on April 13, 2018. General Secretary Xi said, deepening overall reform and opening-up in Hainan is a major national strategy, which requires rallying support from the entire country as well as global talented people. Here I would like to thank the various central government departments for their support to Hainan in this regard.

To implement General Secretary Xi's speech and our action plan for 2025, the CPC Hainan Provincial Committee established a working committee on human resources for which I act as the director. After regular studies, we have unveiled a series of measures on how to fully utilize talents and provide assistance with their housing and children's education. In the last two years, more than 100,000 people have come to Hainan to find jobs or start their own business. When 100,000 people crossed the Qiongzhou Strait to Hainan 30 years ago, people with PhDs had to work as shoe-shiners since there were no jobs for them. In contrast, all 100,000 people who've settled in Hainan today can secure employment. We've recently released 40,000 job vacancies for global recruitment, and more will be available by the end of this year. Hundreds of thousands of talented people are expected to apply for jobs.

To address the shortage of competent personnel, we need to make Hainan an attractive destination, where worries about life can be lifted and talent realized. Hainan boasts a good ecological environment , clean air, clean water, and delicious food. But most importantly, there need to be enough job opportunities. As I've explained, to attract talented people, we need to ensure there are jobs for them.

We are helping them solve problems regarding the education of their children. We have introduced more than 80 top kindergartens, primary and middle schools from home and abroad. Many of those who came to Hainan to start businesses worry about whether their children can receive quality education. They also worry about whether there are sound health services. We have introduced over 50 top medical institutions worldwide. So, I think talented people are now willing to work in Hainan.

In addition, we must find ways to retain them and put their talents to best use. Low employee mobility in recent years showed that Hainan is able to retain talented professionals. With favorable policies and a pleasant climate, Hainan has attracted a large number of talented people. The master plan for the free trade port and related policies will surely attract more competent personnel to work in Hainan.

Hainan focuses on the development of tourism, modern services and high-tech industries. Apart from individual companies, many teams, headquarters, and high-end enterprises have settled in Hainan. An enterprise may bring hundreds or thousands of talents. As I introduced just now, we had 444,000 new market entities launched in the past two years, an increase of 66%. In fact, the number has grown more than 30% every year. Hainan, with over 9 million people, has more than 1 million market entities. I believe the unique policies will attract more market players to start businesses in Hainan.

While attracting competent personnel from outside, we also leverage the role of local talented people, who are currently the mainstay of Hainan's development. Over the past two years, the CPC Hainan Provincial Committee has attached equal importance to these two aspects of work related to human resources. To leverage the role of local talented people, we provide them with training opportunities. Each year we send hundreds of people to attend training programs organized by national government agencies and overseas institutions. 

The Hainan FTP involves the development of the whole island. The majority of Hainan people live in rural areas, which account for most land in the province. The development of rural areas determines the success of the Hainan FTP. We provide education and training to residents, including those living in rural areas. We've introduced a package of preferential policies for village teachers and rural doctors in terms of professional titles, salary, and housing so that they are willing to stay in rural areas. 

Hainan will promote the integration of urban development across the entire island in its construction of a free trade port. So, we must improve the quality of personnel in rural areas. We've recently honored artists, craftsmen, and other talented rural residents, encouraging them to play a more significant role in Hainan's development. We will continue to make efforts in the two aspects of work related to human resources. Thank you.

China News Service:

We know the construction of Hainan FTP with high quality and high standards cannot go forward without the active participation of a large number of high-quality market players. What are the core policies of Hainan FTP that enterprises can directly enjoy? Thank you.

Shen Xiaoming:

I remember that in the important speech made by General Secretary Xi Jinping on April 13, 2018, he stated: "China welcomes investors worldwide to invest and start businesses in Hainan and participate in the building of a free trade port, thus sharing the country's development opportunities and outcomes of its reform." The construction of the FTP requires market entities, and they need to understand what policies we have established for them. As soon as the master plan was announced on June 1, we extracted 60 pieces of essential information about preferential policies from the master plan and publicized them via the WeChat public account platform. In the first 40 minutes, the article attracted over 100,000 views, and after two-and-a half hours that exceeded 500,000. This indicates market players are very concerned about the policies of Hainan FTP. As there are many policies, here I will choose four of them for simple interpretation.

First is the freedom and convenience of investment. The Hainan FTP will implement a policy of "all can enter if not prohibited," which means that, unless there are compulsory standards and legal prohibitions involved, the government, in principle, cancels permits and approvals, and replaces this with a system of filing and commitment by enterprises. If the commitment meets the conditions, then the business can begin operating. The government agency handling the filings will fulfill its regulatory obligations through supervisions during and after completion of the investment. It implements a pre-entry national treatment plus a special FTP negative list management system for foreign investment. We will further reduce restrictions and prohibitions on the basis of the normal procedures of a free trade zone. For domestic enterprises registered in the FTP, we will support them to raise funds by issuing shares overseas. In addition, if they are engaged in tourism, a sector of the modern service industry, high-tech industries and other areas we wish to encourage, the direct investment income from abroad can be exempted from corporate income tax. Therefore, in terms of investment freedom and convenience, this is a very complete system.

Second is the zero tariffs on trade in goods. After the whole island seals the customs, except for a few special products, no more import tariffs will be imposed. However, before the whole island was closed for the FTP, we also set four types of items exempt from customs duties through list management. They are production materials, raw and auxiliary materials, transportation vehicles, and consumer goods for island residents. I have roughly calculated that the tax cost of importing yachts, for example, can be reduced by about 38%. Originally, when you spent 10 million yuan in importing a yacht, you needed to pay 3.8 million yuan in taxes. But if you buy a 10-million-yuan imported yacht in Hainan, you don't need to pay the 3.8 million yuan in taxes. So you save 3.8 million yuan here, than buying yachts elsewhere. In addition, for the tax on imported entertainment equipment, you can save about 20%. Just a few days ago, I went to a biopharmaceutical R&D service outsourcing company in Haikou to undertake a survey. The person in charge told me that he planned to buy R&D equipment. Before the zero tariffs policy, he would have needed to spend 300 million yuan; now, the cost is only 200 million yuan, saving him one-third. Thus, the cost of building a R&D center in Hainan is lower, and he could buy more equipment and hire more people for the same amount of money. What's more, the Yangpu Bonded Port Area and other special areas will be the first to implement the rules of origin. What does this mean? It's when you have imports among your raw materials for production, if you can achieve more than 30% in added value in a designated sector, the products you produce will not need to pay tariffs when they enter the Chinese mainland market again. Let me give you an example for frozen products. The annual import of frozen products of beef, mutton and pork in our country is about 6 million tons. The import of frozen products in 2019 increased by 45% compared with 2018, and it is growing rapidly each year. Taking beef as example, the general import tariff for whole or half cattle is 70%, and the import tariff for most-favored nations is 25%. If the whole or half cattle are imported through Yangpu Port, they will be divided into thigh meat, beef tendon, etc. through preliminary processing, making it easy to add 30% in value. If that is achieved, the beef will enter Chinese mainland market avoiding 70% or 25% of the tariff. Therefore, the profit margin of the enterprise is very huge, and the common people can eat cheaper imported beef. This means the rules of origin are extremely important monetarily.

Third is the tax rate of income tax . From now until 2025, we will reduce or exempt income tax for eligible companies and individuals. For example, for enterprises from encouraged industries, registered and operating in Hainan FTP, we will reduce the enterprise income tax by 15%. Also, for high-end and urgently needed talents working in Hainan FTP, if they stay in Hainan Island for a minimum of 183 days, in regard to their actual personal income, the portion above standard rate of 15% on that income will be exempted. Therefore, it is also very attractive for high-end talents in short supply.

Fourth is service industry opening. We will greatly reduce market access barriers and intensify the opening for the service industry in the three major sectors of tourism, modern services and high-tech industries, especially the key areas of planting, shipping, telecommunications, business services, finance, medical treatment, education, culture, sports, etc. Let us take the example of basic telecommunications. The policy of our country so far is that basic telecommunications require Chinese control. In the new version of the FTP master plan, it mentions the orderly opening of basic telecommunications for the first time. For another example, we support overseas securities, futures and fund management institutions to set up wholly-owned or joint venture financial institutions. And for another example, we allow foreign universities of science, technology, agriculture, medicine and vocational education to be able to establish and run schools independently in Hainan. These opening policies have never been seen before.

There are many specific contents of the policies. During this time, we will continue to interpret them to society in different forms and answer questions for everyone. If you have any questions, you can check our website www.contacthainan.gov.cn. or you can leave your questions with us. We will answer you in due time. Recently, Hainan has been organizing various forms of investment promotion briefings. The media are welcome to actively participate.

Nikkei:

The objective of this plan is to turn Hainan into an international hub of trade and finance. Does that mean Hainan will replace some of Hong Kong's function and status in the future? Thanks!

Lin Nianxiu:

Thanks for your question. As we know, Hong Kong port, Singapore port and Dubai port are model high-level international free trade ports, each boasting distinctive modes of development, polices and institutions of its own. Hong Kong, as an important international hub of finance, shipping and trade, has been rated by multiple international organizations as one of the freest and most competitive regions in the world. In particular, since its return to the motherland, Hong Kong has remained stable and prosperous under the system of "one country, two systems." It has integrated itself into the great endeavor to realize the rejuvenation of the Chinese nation.

In order to turn Hainan into a free trade port, we should study well-known international free trade ports, integrate high-standard international economic and trade rules and explore a system of institutions featuring openness and international competitiveness. Meanwhile, we should make full use of the island's advantages, including its abundant natural resources, unique geological location and the super-huge domestic market and hinterland economy backing it. Focus should be placed on trade and investment liberalization and facilitation, as well as such industries as tourism, modern service and high and new technology. We should quicken our steps to foster new advantages with Hainan characteristics that inject vigor into the development of global free trade ports.

In this sense, Hainan FTP is different from Hong Kong both in terms of positioning and priority industries. The two are more complementary than competing. Therefore, Hainan will not have a negative impact on Hong Kong. In the process of building Hainan FTP, we will strengthen coordination with the Guangdong-Hong Kong-Macao Greater Bay Area and proactively push forward pragmatic and effective cooperation to help ensure Hong Kong's long-term security, stability and prosperity. We will also smooth the implementation of "one country, two systems." Thanks.

Hainan Television:

The master plan for the Hainan Free Trade Port has decided to establish a system of policies and institutions that will build Hainan FTP with a focus on trade liberalization and facilitation. Could you shed some light on consideration taken when designing policies and institutions related to trade liberalization and facilitation throughout the course of building Hainan FTP? What features will there be? Thanks.

Wang Shouwen:

Thanks for your question. Trade liberalization and facilitation is a basic and common feature of all advanced free trade ports in the world. Today, a lot of regional and bilateral free trade agreements have stressed trade liberalization and facilitation. Of course, trade liberalization and facilitation will be a very important element in the institutional design for Hainan FTP. Actually, it is a focus.

When it comes to institutional design, we attach high importance to innovation. We will not only draw on experience of other countries, but also make it embody Chinese characteristics and suit Hainan's positioning. Trade liberalization and facilitation should align with China's broader efforts to comprehensively deepen reform and expand opening-up. Trade liberalization and facilitation has two aspects: First is goods trade liberalization and facilitation, and second is service trade liberalization and facilitation. The goods trade liberalization and facilitation has several features. First, we will work toward "zero tariffs." That means that we will establish a list of goods to be tariffed in Hainan FTP. All imported items excluded from the list will enjoy "zero tariff" status. Second, we will work toward "zero barriers." In terms of non-tariff measures, such as license and quotas, we will establish a list of exported and imported goods and items to be restricted or forbidden in Hainan FTP. All goods and items excluded from the list will be free to come and go. Third, we will promote facilitation. All imported goods will be handled through a single window of international trade, which will be very convenient. We will put in place effective and convenient customs supervision to facilitate the flow of goods. Fourth, under the circumstances of trade liberalization and facilitation, we will ensure that risks can be prevented and controlled. We will build high-standard port infrastructure and regulate it in a smart and targeted way.

Service trade has four modes. Cross-border supply, overseas consumption and the movement of natural persons constitute cross-border service trade. With regard to the three forms, we will establish a negative list for cross-border service trade. Entry of all service trades of these three forms outside the negative list will be allowed. The fourth mode is called commercial presence, which means providing services locally. Once entry is allowed, persons will have to meet proper standards and qualifications to receive operation permits. Some technologies will have to meet certain criteria for transparency and supervision. We will update regulations to liberalize and facilitate a commercial presence. In terms of service trade, we will make sure entry and operation are both allowed.

According to the master plan for the Hainan Free Trade Port, development will proceed in two phases. The first phase is expected to be completed by 2025. Three aspects of work will be done. First, we will pilot the policy of "opening up at the first line and strengthening regulation at the second line" in the Yangpu Bonded Port Area. Second, we will establish the "One Negative and Three Positives" list. As Secretary Liu and Governor Shen mentioned just now, the "One Negative and Three Positives" list will be put in place before the free trade port system. It focuses on trade and investment liberalization and facilitation to be basically established in Hainan by 2025. The "Negative" list refers to administrative measures for the import of equipment used by enterprises themselves. Goods not on the list will be exempt from tariffs. The "Three Positives" will be established to regulate the import of transportation tools, raw materials to be processed for export goods and everyday use items for the people of the island. Goods on the three lists will be exempt from tariffs. Third, within this year we will put in place a negative list for cross-border service trade, which I just mentioned. Any restrictions concerning the three forms of service trade will be included in the negative list. Those not on the list will be free from restrictions. This institutional innovation is a highlight for Hainan FTP. It will become China's first negative list for cross-border service trade. It's worth looking forward to. Thanks.

China Financial News Agency:

I have a question for Minister Zou. Hainan FTP will adopt a "zero tariffs" policy to have an early harvest before the free trade port system is established in 2025. Could you shed some light on the considerations made by the ministry of finance? Thanks.

Zou Jiayi:

Thanks for your question. All my colleagues have mentioned the "zero tariffs" policy, which is a very important institutional design of the Hainan FTP. To be specific, we will take phased measures to promote trade liberalization and facilitation. This process will feature "zero tariffs." Initial achievements of the "zero tariffs" policy include some of the imported goods becoming exempt from tariffs, import VAT and consumption taxes. The policy covers the following aspects: 

First involves production equipment. A "zero tariffs" negative list will be applied to production equipment used by enterprises. Second involves transportation tools. A "zero tariffs" positive list will be applied to ships and aircraft used for transportation and tourism purposes, as well as yachts. Third, raw materials. A "zero tariff" positive list will be applied to the raw materials used for production within the island and the raw materials to be processed for export goods. Fourth is everyday consumption items. For items of everyday use, we will put in place a "zero tariff" positive list to allow island residents to buy them tariff free. These four kinds of goods, which were mentioned by Mr. Wang just now, will be covered by the "One Negative and Three Positives" list. Fifth, we will relax the duty-free shopping policy to a great extent. The duty-free shopping quota will be raised from 30,000 yuan per person per year to 100,000 yuan per person per year. The scope of duty-free items will be expanded from the existing 38 kinds of goods. We will improve management to provide more convenience to customers. If you want to travel to Hainan, I advise you to take extra money and do a lot of shopping. Sixth, we will support Hainan to develop a convention and exhibition center economy to promote international exchanges. We will study and formulate duty-free policies for the import and sales of exhibited items abroad during nation-level conventions and exhibitions. Such can also be classified as an early harvest.

When conditions are ripe, we will, based on a simplified tax regime after 2025, exempt from tariffs all imported goods beyond the catalog of imported goods to be tariffed. This marks the final arrangement towards "zero tariff." Just as Mr. Wang said, the country needs to establish a catalog of imported goods to be tariffed. Only the goods in the catalog will be tariffed, and the majority of the goods that are not in the catalog will be exempt from import tariffs.

The "early harvest" in the "zero tariffs" policy are wide-ranging, covering nearly all aspects of Hainan's economy and social life. Those who will benefit include manufacturers, such as enterprises, and such consumers as residents and tourists. The industries that will be underpinned include material production enterprises and service enterprises. The scope of goods involved is wide, including large production equipment, transportation tools, and items of everyday consumption. In the future, we will establish a "One Negative and Three Positives" list that focuses on such industries as those of new and high technologies, ecological protection, and those with Hainan characteristics. By doing so, we will lay a solid foundation for the development of Hainan's real economy. In the meantime, we will adjust the "One Negative and Three Positives" list according to the island's actual conditions. In general, we will gradually shorten the negative list, expand the positive list and unleash more benefits of the "zero tariffs" policy. 

What we initially learned from "zero-tariff" policy is to act early, that is, to implement the policy as early as possible so as to see its effects at an early date. On the one hand, it can attract more people, logistics and capital flows to Hainan province, and provide economic support for the development of the Hainan FTP as well as increase people's confidence in Hainan's development. On the other hand, the move will help gain experience and get prepared for the independent customs operations in the whole island after 2025. 

We will follow the requirements of the master plan and actively promote the early implementation of the fiscal and taxation policies of the free trade port to build a high quality and standard construction. The Hainan FTP will be made into a distinctive example of reform and opening up in the new era. Thank you all.

Economic Daily:

The master plan proposes to build a risk prevention and control system to specifically address risks in key areas. What risks are there in promoting the development of the Hainan FTP? How will Hainan enhance its risk prevention? Thank you.

Liu Cigui:

Thank you for your question. The Hainan FTP, which emerges in an era of China's national rejuvenation with the most profound changes of a century, has become a distinctive feature of China's opening-up and reform. Hainan is just getting started as a free trade port. As a free trade port, Hainan is now pulling off a great undertaking as it will be the only free trade port on the Chinese mainland. Nobody has ever experienced this before. Despite that, we will make sure to give top priority to the risk prevention and control measures you just mentioned. There is a saying that goes, "any regulatory streamlining can only serve its purpose when supported with enhanced compliance oversight." There are some risks that can be expected. Mr. Zou just mentioned the negative list and three positive lists. We have analyzed the risks and developed measures to prevent and control them. There are also risks that may come up during development. We will prepare for these too. 

First of all, it must be made clear that the Hainan FTP is administered under the socialist system with Chinese characteristics, which means it will follow the path of socialism with Chinese characteristics. In other words, despite many free trade ports around the world existing in capitalist countries, Hainan's free trade port will exist under a socialist system. Hence, we will uphold the leadership by the CPC and follow the path of socialism with Chinese characteristics. There are some acts that will not be allowed. These include any acts to endanger national security; ideologically undermine the socialist system; smuggle goods and pornography; gambling, drug abuse and trafficking; any act that destroys Hainan's ecological environment; and finally, corruption during construction. We will formulate and make corresponding prevention and control measures to deal with these matters. 

For more than a year, the Hainan Provincial Party Committee has attached great importance to the risk prevention and control of free trade port, and has done a careful analysis, broadly summarizing 13 categories. There are more than 100 risks, large and small. There may be others we can't think of in the development process, but fear not! As long as we have a strong sense of prevention and resolution, we will continue to improve our ability to prevent and resolve risks and improve social governance.

Many are concerned about Hainan's real estate. One has to work in Hainan for at least one year before getting qualified to buy a house there. The Hainan island-wide purchase restriction was implemented gradually. As a matter of fact, it is also a process of risk prevention and control. Earlier in 2015 when General Secretary Xi Jinping presided over the meeting of the Central Commission for Deepening Overall Reform, Hainan was designated to be a pilot zone for integrating multiple regulations. From then on, we suspended land use approval and building approval for real estate developers. At that time, real estate developers had tens of thousands of hectares of land resources that could be used for the construction of commercial housing. Later, we abolished the assessment of fixed asset investment and fiscal revenue in two thirds of local cities and counties, a move which actually served as a fundamental restriction to the local real estate industry. We did this based on the principle that "houses are for habitation not speculation" and given the facts that there were more than 20,000 real estate developers then in Hainan and that many local cities and counties had their taxes and fixed assets investments rely on selling land for real estate development. After General Secretary Xi Jinping delivered an important speech on April 13, we made a tough decision of implementing home-purchase restrictions across the island in June 2018. Now it seems that we have experienced a great pain, but we believe that the risks historically emerging from real estate with several big ups and downs will not appear again after the release of the free trade port policy. That's why we said some risks can be expected and should be prevented in advance. There are many in this case, so we will start with a mechanism for managing risks.

Second, legislatively speaking, Hainan is implementing its anti-smuggling ordinance with clear provisions against smuggling. After a zero-tariff policy is adopted, the free trade port will enjoy the free flow of goods at the frontline of the territory of China while efficient controls must be put in place at the secondary line of the Customs of China. The control measures mainly target smuggling of goods. Hence, the Standing Committee of Hainan Provincial People's Congress has formulated relevant regulations. As for risks from anti-corruption and integrity I mentioned just now, there will not be a good business environment if these risks cannot be controlled as the public power expands with more projects and investments. In this regard, the provincial commission for discipline inspection and supervision and the auditing office of Hainan has formed a group to supervise over the whole bidding and tendering process of all investment projects in Hainan. 

We have established a social management information platform, not just talking about what we can manage, but also being our hardware. Online anti-smuggling controls have been put in place 12 nautical miles out to sea. This covers 1,944 kilometers of coastline. Our entire shoreline can be monitored seamlessly via satellites, shore-based radar and remote capturing. This is our managing mechanism for controlling risks and anti-smuggling. Thank you.

China Daily:

Judging from the experience of the construction of mature international free trade ports, an open financial policy is a basic feature. In the future construction of Hainan FTP, what are the considerations of the People's Bank of China in terms of financial policy design? Thank you.

Pan Gongsheng:

Thank you. The free movement of elements is an essential feature of a high-level free trade port, of which the free movement of capital is the most basic and central element, as well is a fundamental condition for trade and investment facilitation. In the process of building the Hainan FTP, the design and promotion of financial policies will follow three principles: first, the establishment of a free trade port policy and system will be carried out gradually step by step in accordance with the master plan. Second, finance will be positioned to serve the liberalization and facilitation of cross-border trade and investment. Third, the bottom line is that there will be no systemic financial risk. 

The overall framework of monetary policy includes the opening-up of high-level current accounts and capital accounts to facilitate cross-border trade, investment and financing. It also includes the opening-up of the financial services industry, financial reform and innovation to support the development of real economy, and the construction of a financial risk prevention and control system.

Above all, finance is positioned to serve the liberalization and facilitation of cross-border trade investment and financing. The high-level current accounts and capital accounts, opening-up policies and the cross-border fund flow managing policies are the most important and core financial policies in the construction of the Hainan FTP. In terms of cross-border trade, China's fund exchange for current accounts is fully open. Hence, a high-level of fund exchange facilitation can be expected at the Hainan FTP. The authenticity verification conducted by commercial banks will fully shift from pre-audit to post-audit. Meanwhile, we will improve policies for managing new forms of cross-border trade, such as cross-border payments from offshore trade and transit trade, and develop a policy environment that facilitates the operation of the global settlement center for transnational corporations.

In terms of cross-border direct investment, we will fully implement the pre-entry national treatment plus negative list foreign investment management system, exploring new forms of cross-border direct investment to meet market demand. We will also put QFLP (Qualified Foreign Limited Partner) and QDLP (Qualified Domestic Limited Partner) systems into trial application in the Hainan FTP.

Regarding cross-border financing policies, a new institution will be launched to facilitate cross-border capital raising on the island where the administrative framework in charge of transactions will be streamlined on a trial basis. A unified macroprudential management policy will be implemented to empower market entities with greater autonomy, and broader access to foreign currency exchange will be provided to local residents. Given that open financial policies usually lead to strong spillover, a fundamental platform, constituting established domestic and foreign currency, and free trade accounts as well as a holistic digital monitoring network of fund flows, will be created to ensure Hainan's financial openness.

Second, our efforts will be dedicated to securing Hainan's openness by providing financial services and upgrading financial prowess. The Hainan FTP will take the lead in implementing policies designed to expand local financial services and increase financial diversity. Meanwhile, the open economy is expected to be supported by financial institutions such as commercial banks, which are supposed to grow with stronger competences. Moreover, platforms involved in transactions of productive factors, such as global energies, shipping and bulk commodities, will also be buttressed.

Third, policies will be created to promote key areas encompassed in Hainan's modern industrial layout. Reforms, innovation and financial assistance will be fostered to expand essential industrial clusters and upgrade industrial competences. Financial services are expected to focus on trade and consumption, as well as ecological, scientific and technological development.

Fourth, a prevention and control system will be developed at the Hainan FTP to guard against financial risks. Monitoring alarms and evaluation systems as well as the macroprudential management system will oversee cross-border capital flows, and supervisory mechanisms established to counteract money laundering, terrorist financing and tax evasion will come into effect. In addition, a supervisory, administrative and coordinative scheme will be introduced to fortify the Hainan FTP's development.

In the next phase, the People's Bank of China (PBOC) and the State Administration of Foreign Exchange (SAFE) will take every opportunity to support the reform and opening-up of Hainan province by coordinating with local government and financial administrative bodies in accordance with the deployments made by the CPC Central Committee and the State Council and the schedules stipulated in the master plan. Thank you.

People's Daily:

What significant roles will the free trade port with Chinese characteristics play following the master plan released despite the multipronged impacts caused by the pandemic which has brought about immense pessimism towards globalization among some scholars?

Lin Nianxiu:

Based on my introduction of the major issues incorporated in the master plan, we fully understand that the construction of the Hainan Free Trade Port demonstrates the CPC Central Committee's major strategic decisions implemented to advance the development and encourage innovation of socialism with Chinese characteristics amid the current situations both home and abroad. The plan also represents a milestone in China's reform and opening-up during the new era. Its realistic significance and strategic implications can be concluded in the following four aspects:

First, the plan is designed to meet the fundamental requirements of developing an open economy. The Hainan FTP has been built since the country embarked on its epochal journey for the overall development of a modern socialist country. While building the Hainan FTP, we will learn from advanced experiences abroad, meet the international high-end standards on economy and trade, and develop internationally competitive opening-up policies and institutions. The Hainan FTP will lead a wave of deeper opening-up nationwide to pave a new path and accumulate experiences so as to advance reform and opening-up to a higher level.

Second, it is imperative for the plan to create a market-oriented, law-based, and internationalized business environment. The Hainan FTP is expected to promote the openness based on the flow of commodities and productive factors, and expedite the openness of rules, regulations, administrations and standardized institutions. It can propel the government to alter their role of governance, ensure market competition acts on a level playing field, promote innovations in social governance, and establish modern legal systems, to name just a few. Generally speaking, a high-standard of opening-up will be secured to deepen reform so that a world-class business environment can be created.

Third, the plan is a strategic choice for high-quality development. The Hainan FTP is designed to ensure free cross-border fluidities of multifarious factors, introduce advanced technologies, management concepts and administrative practices from abroad, and create a global cluster of high-end productive factors, including capitals, knowledge, technologies, management and talents. Acting as a model for high-quality economic development around the country, the Hainan FTP is expected to chart a distinctive modern industrial layout with the characteristics of Hainan.

Fourth, the Hainan FTP is being established in accordance with the concept of building a community with shared future for mankind. The construction of the Hainan FTP shows China's resolve in continuing its policies of opening-up, signaling broader access rather than a closed door. China will continue to promote the liberalization and facilitation of investments and trade exemplifying inclusive international cooperation, and play a leading role in advancing economic globalization. As an important platform, the Hainan FTP will deepen China's involvement in global economic governance and enable China's participation in making international economic and trade rules so as to contribute a Chinese proposal and wisdom to building a community with shared future for mankind. Thank you.

CRI:

What will the Yangpu bonded port advance during the early stages of constructing the Hainan Free Trade Port?

Li Guo:

Thank you for your question. The master plan stipulates that the construction strategy of the Hainan FTP will be divided into several different steps and phases. For instance, according to the master plan, 18 highlighted programs are scheduled to be rolled out by 2025. Among them, the first is to place several qualified special customs oversight areas, such as the Yangpu bonded port, under the jurisdictions of first-and-second-line customs with institutionalized administration working on imports and exports. The first-line concentrates on openness, and the second-line on monitoring and regulations. This means that Yangpu can be one of the areas running with special customs jurisdictions. In other words, Yangpu will be the Hainan FTP's pilot zone. In this particular zone, an innovative management institution with liberalizing (the first) and controlling (the second) lines will be launched to yield positive policy-related interests during the early stages. The zone will also act as a trailblazer in taking a raft of measures to reinforce the facilitation and liberalization of trade so as to stimulate and improve the Hainan FTP's development in accordance with the experiences it has gained. From this point of view, the construction and implementation of the Yangpu bonded port will play significant roles in exploring and ensuring the operation of Hainan's closed-off and free trade port policies. 

In accordance with the deployment made by the CPC Central Committee, the General Administration of Customs (GAC) issued the "Regulatory Measures on Yangppu Bonded Port" ("The Measures") on June 3, 2020, after several rounds of research and deliberations. Despite focusing on liberalization and facilitation of free trade, the GAC has abided by the principle that the pursuit of overall openness depends highly on administrators' good command of situations. Therefore, "The Measures" is learning from the experiences of customs administrated with special jurisdictions. While looking into "The Measures," people may notice that Article 31 of Chapter Seven features a number of points regarding trial operations:

First, the pilot processing value-added tax (VAT) policies stipulated in the master plan will exempt a number of enterprises in highly-needed industries from import tariffs. More specifically, processing enterprises with no imported raw materials, or those with imported materials but whose processing value added surpasses 30%, in the Yangpu bonded port, can sell their products to the rest of the country free of import taxes. However, import VAT and consumption tax still need to be levied. There are two critical points in this provision that require pointing out: first, the enterprises should be entitled to the preferential policies, and second, the tax exemption refers to customs duties.

Second, reports submitted to the first-line customs will be streamlined. With risks being controlled, a certain number of commodities transferred between the Yangpu bonded port and overseas markets will no longer need to be reported to customs. Reports will be validated only for goods in need of being checked or quarantined by the entry-and-exit administrations, including those stipulated by international conventions, treaties or agreements, or those on the security list. Despite this, access will be maximized as much as possible at the first-line customs.

Third, the liberalization of the zone will be highlighted with enterprises being dutybound to self-operate and manage. In most cases, enterprises in the zone can transfer, merge, cooperate, process, transact, research, develop, redevelop, inspect, test and change without needing to undertake any customs procedures. Meanwhile, their commodities in the zone can be stockpiled with no time limits. Customs has revoked registration procedures to enable enterprises to forgo the previous normal regulatory procedures, including write-off procedures. At the same time, customs will utilize a big data platform for risk evaluation and artificial intelligence identification to launch critical inspection, and practice precision-targeted administration.

Fourth, the second-line management will be accentuated. The digital network should be strong and passes should be monitored flawlessly with customs inspections being launched for every vehicle (including those for official use), commodities, belongings and people entering and exiting the zone, in accordance with laws and regulations. 

Fifth, the statistical approaches will be reformed. The real-time single-ticket calculation at customs will be substituted by a digital information management platform which enables automatic mathematics to be applied by the administrative bodies in the zone. 

Sixth, the development of interim consolidation services will be supported. International shipping can be streamlined with interim consolidations backed by a digital platform based on which warehouse receipts will be sent online. 

Seventh, a coordinated mechanism will be established. Based on the holistic digital information management services platform established by the regulatory bodies of Yangpu bonded port, a mechanism will be formed using unified regulations and reliable data stock in terms of original accounts. Based on the mechanism, the interconnection among administrative bodies, border regulatory authorities and enterprises in the zone, can be achieved and the responsibilities can be precisely targeted thanks to available data. Therefore, the mechanism will enable local governments to have a big say, ensure coordination between multifaced administrations and regulatory bodies, and promote greater autonomy for enterprises.

Eighth, no facilities established by local residents for commercial use will be prohibited. In view of the business nature of the Hainan Free Trade Port as well as indigenous commerce and consumptions, the facilities for commercial use in the Yangpu bonded port will not be embargoed. This is a major breakthrough since residences and business facilities are not allowed to be established at places under the special jurisdiction of customs. This is an initial attempt.

In the next phase, customs will improve their regulatory work to support the high-quality opening-up and development of the Yangpu bonded port. We will evaluate the pilot performance inside the zone in a timely fashion before expanding and implementing a more mature scheme under the special jurisdiction of customs to the rest of the zones, such as the Haikou Integrated Free Trade Zone. Thank you.

The Poster News APP:

The official release of the master plan is a very important opportunity for Hainan's development. How will Hainan province make use of this policy advantage to further improve its business environment? What benefits will the policies bring to the people through the development of Hainan free trade port? Thank you.

Shen Xiaoming:

The comparative advantage of Hainan is its environment covering three aspects, including its ecological environment, business environment and policy environment. It's fair to say that the business environment is one of the key issues essential to the success of Hainan free trade port. The general goal in this regard is to create a world-class business environment governed by rule of law, meeting international standards, and business-friendly. When optimizing the business environment in Hainan, we've attached great importance to two aspects. The first is fairness, transparency and predictability. Fairness means that all parties will be treated in the same way, regardless of whether it involves domestic or foreign investment, State-owned or private business, local or outside company, and people familiar or unfamiliar to us. Transparency and predictability mean government needs to be transparent about whether a thing can be done or not and how, including the standards, procedures, and courses of action that need to be taken, so that market entities can feel the entire process and results are predictable. The second requirement is to clarify the roles of government and enterprises. The concept of respecting enterprises and entrepreneurs should be reinforced. They have the final say on whether the business environment is good or not. Government, officials, or even the evaluation system itself cannot be the judge. 

Just now you've raised a very interesting question about the benefits for the people brought about by the policies adopted for the development of Hainan free trade port. The reason I think it is interesting is that, if you read the master plan literally, it seems that this document has nothing to do with the people as all it talks about are policies and market activities such as investment and trade. However, a more careful analysis will show the public benefits the free port will bring. For people in Hainan province, statistics show that, over the two years since General Secretary Xi Jinping's important speech in Hainan on April 13, 2018, the number of market entities has increased by 444,000, which is a gain of 66% from the previous level. Among them, the number of businesses has increased by 144,000 (up 68%), creating 400,000 jobs. That's a direct benefit for Hainan people. Among the 144,000 new businesses, 117 were investments by Global 500 companies. Thus, in addition to the increase of jobs, the quality of the jobs has improved, and there are more options available. Of course, benefits brought to local people are not limited only to employment. In terms of consumption, just now Mr. Zou mentioned that the master plan will allow the local community to purchase some imported daily necessities in a tax-free way in Hainan island under a list-based management system. We believe this will mean the price for some imported daily necessities will be much lower than that outside of the Hainan free trade port. 

What does the Hainan free trade port have to do with people across China? First, we will optimize to a great extent the existing Hainan offshore duty-free policy. Just now Mr. Zou elaborated on this topic. Hainan will become an important destination of tourism and shopping. We hope it can become a paradise not only for tourists, but also for shoppers across China. Second, Hainan free trade port will provide unprecedented opportunities for talents in China and around the world. My colleagues have also covered this topic, so I'll not repeat what they have said. Recently people are talking about the old and new generations. This is a relative concept. Whatever generation, you're equally welcome to Hainan free trade port. Thank you.

Bauhinia Magazine:

It has come to our knowledge that, in the recently-released master plan on the development of Hainan free trade port, many policies concerning trade, investment, finance and other aspects have been mentioned. How will the leading group office implement and facilitate these policies in the master plan? Thank you.

Lin Nianxiu:

Thank you for your question. In order to strengthen leadership over the development of Hainan free trade port, the CPC Central Committee set up the Leading Group for for Comprehensively Deepening Reform and Opening up in Hainan Province. Its office is placed in the National Development and Reform Commission, and will take charge of daily work. To better implement General Secretary Xi Jinping's important instructions and facilitate the master plan, the leading group office will further act as a "service provider" and an "accelerator". We will work to provide various services, coordinate relevant parties in a timely manner and exercise strong oversight. We will work closely with Hainan province and relevant government bodies to do the job well. The work of the leading group office in the next step can be briefly concluded in the following four aspects:

First, the list-based management will be strengthened, and the accountability of every task should be clearly stated. The master plan has already been published. Next, we will detail every task specified in the plan, and make arrangements for annual key tasks, including specific requirements, work division and accountability, forms of results, and deadlines. We will make ledgers and advance each and every task to the letter so that we can effectively implement them with practical achievements. We know from the master plan that much work needs to be done to develop Hainan free trade port, thus this project requires arduous efforts. It will be very challenging during the process. The leading group office will list every task and carry out effective efforts to make sure nothing is overlooked.

Second, we will strengthen our study and research efforts and introduce forward-looking policy recommendations. Building a free trade port in Hainan is a new exploration, during which challenges will inevitably occur. Therefore, we think it is particularly important to carry out study and research. The office will regularly visit Hainan to carry out field studies, listen to the opinions of frontline workers, identify and analyze potential problems, and provide suggestions accordingly. We plan to arrange for some staff to work on Hainan island during most of the year to carry out field studies. This is not just an empty slogan; it is tangible work. We will listen to the suggestions of the local party committee and government as well as the demands and voices from market players, especially entrepreneurs. We will listen to people's expectations, collect first-hand materials, and make policy recommendations to the central government.

Third, we will strengthen coordination and create a synergistic policy. The construction of the Hainan FTP is a systematic project, which involves many fields and aspects, and requires coordination and cooperation. The office of the leading group will further improve service and actively communicate with Hainan province and relevant departments. In particular, we will go to the frontline to coordinate on-site and remove the last crucial hurdle for policy enforcement. To speed up the construction of the Hainan FTP, we will make special arrangements and open a green channel to ensure every task is implemented with the fastest speed, the highest efficiency, and the best service.

Fourth, we will strengthen supervision and inspection to ensure policies are fully implemented. The office will track the implementation of the work in a timely manner, coordinate the completion of key tasks on a quarterly basis, carefully investigate inadequacies in work implementation, and introduce improvement measures item by item. At the same time, the office will also establish a work notification system, and particular supervision will be given over the handling of major tasks. It will report important matters to the leading group in a timely manner.

To sum up, under the unified leadership, the office will actively cooperate with relevant departments and Hainan province and promote the construction of the Hainan FTP. Thank you.

Hu Kaihong:

The last question.

Hong Kong Economic Herald:

We all know that Hainan has the best natural environment, air and water quality in the country. How can Hainan balance economic development and environmental protection during the construction of the Hainan FTP? Thank you.

Liu Cigui:

Thank you for your question. In the construction of the Hainan FTP, we must protect the environment. This is the bottom line. The ecological environment of Hainan will only get better and will not deteriorate. This has always been our philosophy guiding economic development. During his inspection tour of Hainan in April 2013, General Secretary Xi Jinping emphasized that green mountains, clear water and blue sky are Hainan's biggest strength in building an international resort island, and must be cherished and taken good care of. We have kept General Secretary Xi Jinping's instructions in mind. No matter how much GDP the project can generate or how much tax we can collect, as long as it affects and harms the environment, we don't do it. In recent years, we have taken a series of measures following General Secretary Xi Jinping's instructions. People are particularly concerned about air quality. The average PM2.5 concentration in 2017 was 18 micrograms per cubic meter; in 2018, it was 17 micrograms; in 2019, it was 16 micrograms. The 1 point drop per year entailed a lot of hard work. We have set a goal that by 2030, the PM2.5 in Hainan will be in the single digits. How can we achieve this goal? We have already taken a series of measures. First, we are using clean energy. By then, the whole island will be using clean energy. Second, we will no longer sell gas-powered cars by 2030. Third, starting from the end of this year, we will prohibit the use of non-biodegradable plastic products, including plastic bags and plastic tableware. Fourth, to address the problem of firewood burning in rural areas, we have built more than 2,000 kilometers of LNG gas supply pipelines. By 2030, we can basically replace firewood with gas. Fifth, our forest coverage rate remains above 62%. We will protect the 4,400 square kilometers of tropical rainforest, which are the "lungs" of Hainan. The Hainan tropical rainforest national park project is under construction upon approval. Sixth, we will continue to improve people's living environment, including the remediation of coastal areas and polluted water and the demolition of illegal buildings. This is our development philosophy.

In terms of the development area, we have restrictions on the locations of the projects. We have established 20 industrial parks. On June 3, 11 of them officially opened at the same time. The projects will be operated inside these industrial parks, and the provincial-level approval authority will be given to the parks. This is what we call, "streamlining the permitting process." There will be supporting facilities like top kindergartens, primary and secondary schools to attract entrepreneurs.

In selecting industries, we mainly focus on three major areas: tourism, modern service, and high-tech industry. For the high-tech industry, we focus on the development of the three well-known industries of land, sea, and air. Land refers to growing hybrid rice at the famous Nanfan Scientific and Research Breeding Base. Sea refers to deep-sea research and development and marine economy. Air refers to the satellite launch at Wenchang Satellite Launch Center on Hainan island and the satellite-related industry. We choose the industries with care. Thank you.

Hu Kaihong:

Today's press conference ends here. Thank you to our seven speakers. Thank you all. 

.

Read in Chinese 

Speakers:

Xu Lin, deputy head of the Publicity Department of the Communist Party of China (CPC) Central Committee and minister of the SCIO

Wang Zhigang, minister of science and technology

Ma Xiaowei, director of the National Health Commission

Ma Zhaoxu, vice minister of foreign affairs

Wang Chen, academician and vice president of the Chinese Academy of Engineering, and president of the Chinese Academy of Medical Sciences

Chairperson:

Guo Weimin, vice minister of the SCIO

Date:

June 7, 2020

Guo Weimin:

Ladies and gentlemen, good morning. Welcome to this press conference.

This morning, the SCIO released a white paper entitled "Fighting COVID-19: China in Action." During this press conference, we will introduce you to its content and provide necessary explanations.

Present at this press conference are Mr. Xu Lin, deputy head of the Publicity Department of the CPC Central Committee and minister of the SCIO; Mr. Wang Zhigang, minister of science and technology; Mr. Ma Xiaowei, minister of the National Health Commission (NHC); Mr. Ma Zhaoxu, vice minister of foreign affairs; and finally, Mr. Wang Chen, academician and vice president of the Chinese Academy of Engineering (CAE), and president of the Chinese Academy of Medical Sciences (CAMS). I'm your host, Guo Weimin, vice minister of the SCIO. 

First, we will give the floor to Mr. Xu for an introduction.

Xu Lin:

Ladies and gentlemen. Friends from the media.

The COVID-19 outbreak is the most widespread global pandemic to hit mankind in the last hundred years and represents a serious crisis and a significant global threat. The virus is currently wreaking havoc throughout the world, and lives are being lost every day. We grieve for those who have been killed and those who have sacrificed their lives during the fight. We extend the greatest respect to those who are struggling to save lives around the clock, and offer true moral support to those who are infected and receiving treatment.

Humanity is at war with the novel coronavirus. Facing this unknown, unexpected, and devastating disease, the CPC and the Chinese government put people's lives and health first. They adopted the most extensive, stringent and thorough containment measures. By working together to overcome the difficulties, the Chinese people have succeeded in containing the spread of the virus. Today, the SCIO releases the white paper entitled "Fighting COVID-19: China in Action," to share China's experience in epidemic control and medical treatment with the rest of the world. The paper introduces what the Chinese people have learned from their adversity, and is intended to bolster confidence and strength in defeating the virus through solidarity and cooperation.

China's painstaking efforts to fight against the disease deserve to be remembered forever. The white paper points out that, "the virus spread faster and wider than any other since the founding of the People's Republic in 1949, and proved to be the most difficult to contain. It was both a crisis and a major test for China." The epidemic outbreak coincided with the Lunar New Year, therefore the massive population movements made the situation extremely grave and complex. The sudden appearance of the previously unknown virus in Wuhan put an overwhelming strain on its medical resources. Restrictions on outbound traffic from Wuhan city and Hubei province were imposed. 60 million people experienced huge physical and psychological stress. Meanwhile, there was enormous demand for daily necessities and supplies to ensure epidemic control and medical treatment. Quarantine and isolation on an unprecedented scale were enforced. The economy faced downward pressure and even a temporary shutdown. In the face of the complex situation and serious challenges, the Chinese people, under the leadership of the CPC, fought the epidemic courageously. We made tremendous sacrifice, and paid a heavy price. However, the decisive results of the defensive battles of Wuhan and Hubei led to major strategic achievements in the prevention and control of the epidemic. The arduous history of China's struggle against the epidemic is the unforgettable common memory of 1.4 billion Chinese people, and they will always remember this part of their history.

China's fight against COVID-19 fully demonstrates the outstanding leadership and science-based decisions of the CPC Central Committee with Comrade Xi Jinping at its core. According to the white paper, since the outbreak of the epidemic, the CPC and the Chinese government have attached great importance to the issue and responded swiftly. General Secretary Xi prioritized the well-being of people and oversaw the general situation. At the critical moment, he made major decisions and led an all-out people's war on the virus. As the virus spread rapidly in Wuhan city and Hubei province, General Secretary Xi sized up the situation and made a resolute decision to close outbound traffic from Wuhan and Hubei, employing extraordinary measures to deal with an extraordinary emergency. General Secretary Xi assumed full command over the control efforts. He chaired many important meetings, including meetings of the Standing Committee of the Political Bureau of the CPC Central Committee, and meetings of the Political Bureau. He inspected the COVID-19 response in Beijing and Wuhan. He ordered major guidelines and overall requirements on the fight against the virus, as well as important principles on epidemic control and medical treatment. Based on changes in the situation, he made major decisions to coordinate epidemic control with economic and social development, as well as take unremitting and meticulous efforts in prevention and control work on an ongoing basis. General Secretary Xi Jinping's personal command and deployment have boosted the confidence of the Chinese people in the fight against the epidemic, gathered strength and set a clear direction.

China's fight against the pandemic demonstrates that it has put the people's interests first and that it considers nothing more precious than people's lives. According to the white paper, China has taken every possible measure to treat patients and save lives at all costs. The country has put in place a centralized and efficient command system to effectively coordinate prevention, control and treatment. It has ensured that no coronavirus patient is left unattended and that all those in need have been tested, quarantined, hospitalized or treated. Severe cases were treated by the best doctors using the most advanced equipment, and critical supplies were pooled to save lives. By doing so, it has improved patient admission and cure rates to the maximum extent possible. As of May 31, 2020, the recovery rate for COVID-19 has reached 94.3% on the Chinese mainland.

China's fight against the epidemic demonstrates its governance capacity and its composite national strength. According to the white paper, the entire country acted promptly after the outbreak to muster the support of the whole country to assist Hubei, and Wuhan in particular, to combat the disease. A total of 346 medical teams composed of 42,600 medical workers and more than 960 public health professionals from across the country and the armed forces were dispatched to assist Hubei during the coronavirus outbreak. To increase the production and supply of medical supplies, medical enterprises operated at full capacity and expanded capacity; meanwhile, enterprises in other industries made rapid adjustments to their manufacturing facilities and turned to producing products for the fight against the epidemic. The country stepped up efforts to ensure material supply in Wuhan and Hubei. From the days when outbound traffic from the city and the province was closed to the days when such restrictions were lifted, millions of tonnes of epidemic prevention and control materials, producer goods and daily necessities were transported to Hubei from across the country.

The Chinese people are the main source of confidence and strength in China's fight against the epidemic. According to the white paper, the 1.4 billion Chinese people represented a formidable force in the fight against COVID-19. After the outbreak, the Chinese people, irrespective of their gender, age or occupation, joined the battle against the epidemic with tenacious, unified willpower. Heedless of their own safety, medical workers headed for the frontline against the virus. The people in Wuhan and other parts of Hubei fought against the new coronavirus with grit in their hearts and the wider interests of others in their minds. Community workers, primary and community-level officials, officials sent to work in communities, police, and customs officers worked day and night. Couriers, sanitation workers, transport employees, enterprise employees, media workers, volunteers and many people from other sectors of society devoted themselves to the fight against the epidemic and bore no grudges. The general public shouldered their responsibilities and united as one, demonstrating two defining values of Chinese culture – solidarity and mutual assistance; and the profound love of the Chinese people for their family and their country.

The Chinese government has made persistent efforts to release information on COVID-19 in a timely, open and accurate manner as required by law. According to the white paper, while making an all-out effort to contain the virus, with a keen sense of responsibility to humanity, its people, history and the international community, China has improved its system of releasing information on COVID-19 and effectively responded to public concern. China wasted no time in releasing information such as the whole coronavirus genome sequence and the specific primers and probes for detecting the coronavirus to the World Health Organization (WHO) and other relevant countries and regional organizations, thus providing fundamental support to global virus prevention and control.

China appreciated the valuable support from the international community during its COVID-19 fight, and it is reciprocating the same goodwill. According to the white paper, the Chinese nation will never forget the help and generosity it received. When the situation in China was at its most difficult point, the international community provided valuable support and assistance to our people, for which China is deeply grateful. Facing a prolonged global pandemic, China has actively carried out exchange and cooperation with the international community, shared information and experiences and done everything it can to provide humanitarian assistance, thereby contributing its methods and strength to the global fight against the coronavirus.

Solidarity and cooperation are the most powerful weapons available to the international community in the war against the pandemic. According to the white paper, the global spread of COVID-19 is currently causing great concern. Every country should make the choice that is right for the interests of humanity and the wellbeing of our future generations. Upholding the vision of a global community of shared future, we should support each other and join hands to build a global community of health for all. As long as the international community maintains its firm confidence, solidarity and cooperation, we will succeed in overcoming the pandemic, and will emerge from this dark moment in human history into a brighter future.

Thank you.

Guo Weimin:

Thank you. The floor is now open for questions. Please identify your media organization before raising your question. Let's begin.

Reuters: 

Chinese scientists have been racing to develop a vaccine for the new coronavirus, and Chinese researchers have launched separately five clinical trials on humans. That's about half of all such trials globally at the moment. So my first question is: Does China plan to conduct such trials overseas, including Belt and Road countries? When China does eventually develop a vaccine, who will it prioritize the shots for, mainland China first, and then outside mainland China afterwards? Lastly, how will China make domestically produced vaccine global public good, as promised by President Xi Jinping, maybe which countries will get them first? The United States? The Belt and Road countries? How would that happen? Thank you. 

Wang Zhigang:

Thanks for the questions from Reuters. Every country has been concerned about the vaccine since the outbreak of COVID-19. The white paper introduced efforts in fighting the pandemic by utilizing science and technology. For example, there are questions that how scientific research, such as medicine and vaccine work, can be integrated into clinical treatments; and how big data and artificial intelligence can be utilized for pandemic control. According to people's understanding of pandemic responses in history, a vaccine currently remains critical to beating the new coronavirus. All countries have prioritized vaccine development in their battle against the COVID-19 pandemic. However, we must understand that vaccine research and development is a very rigorous and complex scientific activity. It is a long and difficult task. Such scientific research is also full of challenges and uncertainties. Some scientists describe vaccine research and development as a carefully-rehearsed dance and not an impromptu performance. Consequently, we must prioritize safety, effectiveness and accessibility during vaccine research and development. Throughout human history, vaccine research and development has played a vital role, but sometimes this process requires taking a few unintended detours. 

A successful vaccine must be secure, effective and accessible. Vaccine research and development generally needs to go through several stages, including virus separation, vaccine construction in the lab, cell experiments, animal trials, clinical trials and then large-scale production. A vaccine must be registered with and approved by the drug administration before it enters the market. Vaccines in China are being developed in five categories, including inactivated vaccines, adenovirus vaccines, recombinant protein vaccines, live attenuated influenza vaccines and nucleic acid-based vaccines. Vaccine research and development and clinical trials both require international cooperation. We have been making efforts toward global cooperation on vaccine research and development, and Chinese scientists and their counterparts from other countries all wish to contribute to building a community with a shared future for mankind in terms of health. Next, once vaccine research and development and clinical trials are completed and China's vaccine is ready to be applied, we will strictly implement the commitment made by President Xi Jinping at the 73rd session of the World Health Assembly by making it available to the world as a public good. 

Thank you.

The Asahi Shimbun:

Premier Li Keqiang said in the Government Work Report at the "two sessions" that many weak links have been exposed in public health emergency management during the COVID-19 response. And academician Zhong Nanshan also said in February that the role of the CDC is too weak, and it should be granted certain administrative powers. Regarding this weakness, what are you going to do to improve it? Thank you. 

Ma Xiaowei:

The COVID-19 global pandemic is a major public health emergency. The virus has spread faster and wider than any other since the founding of the People's Republic in 1949, and has proven to be the most difficult to contain. It is both a crisis and a major test for China. It is also a test for the development and reform of China's medical and health projects. Under the firm leadership of the CPC Central Committee and the State Council, and with joint efforts made by the Chinese people, we made strategic epidemic prevention and control achievements in roughly three months, effectively bringing the outbreak under control and protecting people's lives and their health. Practices in the battle against the epidemic show that China's medical and healthcare system along with its public health emergency management system is generally effective. However, some problems and weaknesses have been exposed.

General Secretary Xi Jinping called for efforts to develop a strong public health system to safeguard the people's lives and their health when he presided over a symposium attended by experts and scholars on the afternoon of June 2. The NHC and relevant departments will shift towards a greater focus on more precise and effective prevention measures, and they will make more efforts to streamline institutional mechanisms, elaborating on the functions of related parties, strengthening early warning capabilities, improving the quality of personnel and reforming mechanisms to ensure related budgetary support. In general, we will strengthen the construction of the public health system and the public health emergency system in the following aspects:

Firstly, we will further improve the mechanism for ensuring related budgetary support. With basic conditions for disease prevention and control improved, we will be able to further implement and improve public health service projects.

Secondly, we will clarify the functions and positions of the CDCs of different levels. In China's four-level disease prevention and control system — namely, national, provincial, municipal and county-level system — we will work to further strengthen the prevention and control of acute infectious diseases and emergency response capabilities. We will also clarify the respective functions and positions of the national CDCs, provincial CDCs, municipal CDCs and county-level CDCs. The national CDC shall be responsible for crucial tasks such as research and development, laboratory testing, professional guidance and etiology and pathogenic analysis. The provincial CDCs shall further strengthen their guidance, supervision, quality assessment and personnel training of regional prevention and control work. The municipal and county-level CDCs shall further strengthen the local epidemiological investigation and improve their daily supervision and monitoring of the local infectious disease spectrum. The county-level CDCs and community-level medical institutions shall strengthen community management and prevention and control work so as to lay a solid foundation for disease prevention at the grassroots level. Therefore, we need to clarify the respective functions of the CDCs at all four levels and streamline institutional mechanisms. In this way, higher and lower level CDCs can work in unison.

Third, we will build up an innovative mechanism combining medical care with disease control and prevention. We will connect the country's system covering the latter with medical care to achieve the smooth flow of personnel, information and resources. As everyone knows, if you are sick, you will go to a hospital. So, the disease will be first found and reported within confines of a hospital. The CDC system has to be closely connected with hospitals, and we intend to ensure that from the perspectives of institutional innovation, guarantee mechanism and personnel management. This is one of our weak spots. This issue has existed for a long time, and there is still some room for improvement.

Fourth, we will work to optimize the monitoring system and enhance our early warning capabilities. Early detection is the essential element within the principle of early detection, reporting, quarantine and treatment, and the key to controlling a major infectious disease. As for early warning, in addition to the online direct reporting system of notifiable epidemics developed after the 2003 SARS outbreak, we now have an administrative reporting system of public health emergencies. And we intend further enhance and improve these two systems. For example, we will establish a public opinion monitoring system, a reporting system for medical personnel, diversified information collection channels for scientific reports, and a multiple trigger mechanism for intelligent early warning. We will improve the emergency plan, establish health emergency teams based on levels and categories, and strengthen overall ability to detect, report, give early warning of, and respond to major public health events.

Fifth, we will enhance the building of the talent pool and develop better ways to motivate them. We attach great importance to cultivating professionals on pathogen detection, epidemiological investigations, laboratory testing, and study and analysis of the overall epidemic situation. It will improve our efficiency and level in routine surveillance, emergency warning, field investigation, situation study and epidemiological survey of major infectious diseases. Moreover, new policies will be formulated to improve public health, personnel training, admission procedures, talent use, salary structure, ongoing evaluation, and an incentive mechanism. As reported, there was once a brain drain in China's disease control and prevention system. We need to improve personnel training and increase the salary structure so that our teams can fully play their role in routine surveillance and management, and can handle emergencies under virtual wartime conditions. Then, we will see a great progress and improvement in our ability of effectively responding to major public health emergencies. Thank you.

NBC News:

There seems to be an information war going on regarding the causes and responsibility for the coronavirus pandemic with the main battle being between the western media on one hand and Chinese state, official media on the other hand. So, it's a very difficult moment when the world needs truthful reporting. Why should people believe in China's official media? How do you respond to accusation that China's official media are apparently engaging in misinformation and propaganda that promote China's image in an attack on the West? Thank you. 

Xu Lin:

Since the outbreak of the epidemic, Chinese media workers together with their international counterparts have undertaken in-depth interviews and delivered reports in a timely manner. They have told stories of fighting COVID-19 in China and all over the world, spread knowledge of epidemic prevention and control, exchanged experiences with other countries, and responded to concerns from society and the public. Their efforts not only help the international community to learn more about China's fight against COVID-19, but also enhance the Chinese people's understanding toward other countries' efforts to contain the virus. In particular, a total of 480 Chinese journalists resolutely went to the front and risked their lives to carry out in-depth reporting in Wuhan, Hubei province, hardest hit at one time by the epidemic. They made a true record of the Chinese people's hard battle against the virus, timely reported problems, and promoted the settlement of these issues. Chinese media workers fully adopted a scientific attitude while reporting on this fight. They are professional and dedicated, and fully deserve our respect. Chinese media's reports about COVID-19, based on facts, are objective. Allegations that Chinese media are making so-called "false propaganda" are not grounded in fact and so are totally untenable. 

We have seen that some foreign politicians and media created a presumption of guilt regarding the origin of the virus, attached a stigma to it, politicalized the outbreak, and even fabricated and spread the so-called theories that "the coronavirus originated in China," "China concealed the facts about COVID-19," or "China should be held accountable for the outbreak." These accusations are groundless, unreasonable and show no respect to science. They have aroused strong indignation of the Chinese people. Chinese media have no interest in the so-called "information war." In fact, in the face of many rumors, slanders and attacks against their country, Chinese media felt bound to respond. Of course, our response does not aim to form part of any "rhetorical war," but aims to tackle problems at the root, make a clear distinction between right and wrong, restore the facts and establish the full truth, spread justice and legal evidence, and uphold morality and conscience.   

As you mentioned, it's now a very difficult moment when the coronavirus is still spreading across the world. In our joint battle against COVID-19, we need unity and cooperation, rather than "playing a blame game," provoking stigmatization, or turning it into a political virus. This virus is the common enemy of humanity, so is misinformation. Now, what the people need most is true, comprehensive and objective information, as well as strength and confidence. The media should show their responsibility in and commitment to reporting global solidarity and achievements in the fight against COVID-19. They should take the initiative to exchange the practices and experiences of various countries in epidemic prevention and control, convey the warmth and strength of all peoples in helping each other in times of difficulty, and inject more confidence and hope into the current global fight. Chinese media have already done this, and will continue to do so. Thank you. 

CCTV:

We have seen that the white paper mentions certain ideas about medical treatment such as "improving the patient admission and cure rates and reducing the infection and fatality rates" and that "the infected were treated in dedicated medical facilities where medical specialists from all over the country and all the necessary medical resources were concentrated." Which of these measures can be shared with the international community? Are there other measures that may be followed in future epidemic treatment? Thank you.

Ma Xiaowei:

In the medical response to COVID-19, the Chinese government has put the people's interests first — nothing is more precious than people's lives. The government introduced the strategy of "early detection, reporting, quarantine and treatment" and the principle of ensuring that "the infected were treated in dedicated medical facilities where medical specialists from all over the country and all the necessary medical resources were concentrated." We have focused on improving the patient admission and cure rates and reducing infection and fatality rates as a major task. Through the strenuous efforts of medical workers, all COVID-19 patients in Wuhan were discharged from hospital by April 26. As of June 2, the recovery rate of COVID-19 patients in the country reached 94.3%, surpassing the average cure rate of viral pneumonia. Since the treatment of COVID-19 patients, we have raised that of severe cases of viral pneumonia to a new level. 

The main measures we have taken are as follows:

First, we have taken resolute and strong measures to control sources of infection and lower the infection rate. We have developed a COVID-19 prevention and control protocol, and this has been updated five times. We have implemented rigorous quarantine and management measures among four categories of people – confirmed cases, suspected cases, febrile patients who might be carriers, and close contacts, making sure that all those in need are tested, isolated, hospitalized or treated in some other away. Under the guidance of the Central Working Group, Wuhan conducted community-based mass screenings twice across the city, leaving no person or household unchecked. This was done in order to rule out all potential sources of infection and make sure all patients and sources of infection among residents and mobile personnel were included, hospitalized and under control where necessary. This played a very important role in the prevention and control of the epidemic. According to the general law of epidemiology, once the source of infection is brought under control, the situation will be hugely different after two recognized latent periods. The measures we have taken have proved to be effective. 

Second, we have speeded up testing. In modern medicine, the testing capacity is essential for identifying and stemming any epidemic. After arriving in Wuhan, the working group on the frontline strengthened guidance in this regard, let China CDC devolve the authority for testing to all hospitals of Grade B and above, expanded laboratories, trained personnel, and involved qualified third parties to enhance testing. The testing period was shortened from two days to four to six hours in Wuhan, and the daily capacity expanded from 300 samples to more than 50,000. A closed-loop system was established, with online reports of cases identified at the fever clinics of medical facilities being submitted to higher authorities within two hours, the test results of such cases being sent back to reporting clinics within 12 hours, and on-site epidemiological investigation being completed within 24 hours. This played a big role in controlling sources of infection. In the early stage of the epidemic, the average time to diagnose a patient was 15.4 days. By the middle stage, it had been shortened to three days. The possibility of transmission was thus reduced significantly. The establishment of the closed-loop system combining epidemiological investigation and testing helped us to have the initiative of epidemic control. 

Third, we have used all available means to guarantee the supply of medical services and improve the cure rate. Across the country, more than 2,000 medical institutions and hospitals for treating severe cases were designated for the treatment of the disease, along with over 10,000 fever clinics. In Wuhan, the Central Steering Group pushed for an increase in hospital beds and the establishment of a network for emergency treatment layered with designated hospitals, temporary treatment centers and isolation points. We built the Huoshenshan Hospital and the Leishenshan Hospital, and transformed a group of general hospitals such as the Tongji Hospital, the Union Hospital and the Hubei General Hospital. The number of designated hospitals increased from 35 to 86. During the prevention and control of the epidemic, we built temporary treatment centers, or Fangcang shelter hospitals, which played a very important role in admitting huge numbers of patients with mild conditions. Because of the construction of temporary treatment centers, we were able to provide hospital beds for confirmed cases identified during community-based screenings. We decided to build temporary treatment centers on Feb. 3. On Feb. 5, the treatment centers started to admit patients. By Feb. 16, we had built 16 such facilities and added 12,000 hospital beds, enabling all those in need at that time to be hospitalized. We realized the goal for available hospital beds to outnumber patients on Feb. 16, and had got the initiative to control the epidemic since then. On Feb. 19, the number of patients discharged from hospitals equaled the number of confirmed cases, thus establishing a turning point. 

Fourth, we have added a group of isolation points. More than 630 guesthouses, schools, training centers and medical facilities were remodeled to host close contacts and suspected cases under isolation. In order to implement epidemic prevention and control work, we have taken effective measures for isolation. Increasing beds was a very important task we have conducted to ensure service provision in the early stage.

Fifth, we have pulled out all the stops to treat and cure patients, improving the cure rate and lowering the fatality rate. Minister Xu Lin just said that we have conducted a massive task of medical care. A total of 346 national medical teams that comprised 42,000 medical workers including 19,000 for treating severe cases were dispatched to Wuhan. The national medical teams took charge of all severe cases and administered the wards as a whole. We let doctors of intensive care unit, respiratory department, cardiovascular department, and infectious disease department take the lead. Large numbers of nurses for intensive care were dispatched to Wuhan. Every patient with severe conditions was looked after by three nurses. We put severe cases together for treatment and continued to improve the level of care. While treating patients with mild conditions at temporary treatment centers, we combined traditional Chinese medicine with Western medicine so as to prevent them from turning into severe cases. With these measures, we significantly improved the level of medical treatment. 

Regarding medical treatment for COVID-19 patients, integrated efforts have been made in the following five aspects. First, the treatment applied has involved a mix of basic medical science and clinical medicine. COVID-19 cases have been studied jointly by doctors and clinicians in virology, anatomical pathology, immunology, and pharmacology. The research in anatomical pathology has played an important role in this aspect. Second, frontline and rear-based medics have made coordinated efforts. When frontline medics encounter problems, those in the rear provided multi-disciplinary support via videoconferencing. Efforts in major medical disciplines throughout China have been organized to support Wuhan. Third, both medical treatment and nursing have been well applied. Nursing is utterly important for patients with severe respiratory diseases. Nursing cares at the early stage to keep the respiratory tract smooth can greatly relieve symptoms amongst COVID-19 patients. Fourth, the combination of medical treatment and management is a very important characteristic. Over 42,000 medics carried out medical treatment in an orderly manner, which demonstrated strong professionalism and administrative and command abilities. Five systems for critically-ill patients were established within a week. The first was a 24-hour report system of critically ill patients. The second was a discussion system of COVID-19 deaths. The third was an inspection system by top experts covering critically-ill patients not only in Wuhan, but also in another 19 cities. The fourth was the management system concerning medical nursing care. A set of unified standards and procedures were applied to nursing care. The fifth was a vertical administrative command system, under which hospitals established medical affairs, nursing and hospital-acquired infection control departments. There were no infections among the 42,000 medics, and no deaths, infections, or relapses among the patients treated in the temporary treatment centers. China's medical treatment in this regard made remarkable progress.

I also want to mention that traditional Chinese medicine has played a very important role in treating both mild and critical COVID-19 patients. This is one aspect that should be thoroughly reviewed and learnt at this time. In addition, when treating COVID-19 patients, medics have fearlessly devoted themselves to saving lives. This reflects the long-built achievement of our medical teams, and it should be inherited. That's all for my introduction. Thank you. 

The Kyunghyang Shinmun:

I have two questions. First, in order to prevent and control the COVID-19 pandemic, personnel exchanges between different countries have been largely impeded. As China has achieved major strategic results in combating the pandemic, when will the existing visa suspension measures be eased? In addition, as China conducts virus control on an ongoing basis along with its economic development, to what extent should the prevention and control work be carried out? Can people take off their facial masks during the Dragon Boat Festival holiday, for example? Thank you. 

Guo Weimin:

There are two questions. The first one is about international personnel exchange, and Mr. Ma will answer that. The second one concerning epidemic prevention and control will be answered by Mr. Wang.

Ma Zhaoxu:

Epidemic knows no border. Since the start of the COVID-19 outbreak, countries have followed the instructions of the World Health Organization (WHO) and adopted some necessary measures concerning personnel exchange including entry and exit control, in order to better prevent and control the epidemic. This is an international practice. Speaking in regard to China's situation, we adopted a targeted, law- and science-based approach, and introduced public health emergency response measures on an unprecedented extensive scale across the country. All those measures aimed to safeguard not only the health and safety of the Chinese people and foreigners in China but also regional and global public health. The COVID-19 pandemic is still spreading across the world, and China is facing increasing pressure to prevent imported cases. Under no circumstance should we slack off. In the meantime, we will pay close attention to the global epidemic situation, and strengthen communication and coordination with various parties and improve in a timely way the prevention and control measures concerning imported cases. On the premise of ensuring the overall situation of domestic epidemic prevention and control, we will coordinate epidemic prevention and economic and social development, making dynamic adjustment to relevant policies and measures. 

We are working with various countries to strengthen cooperation. This includes joint prevention and control on an international level. We aim to restore personnel exchange between China and other countries in a steady, gradual and orderly way and help resume normal work and production and ensure the safety and steadiness of the international industry chain and supply chain. In the meantime, we have provided a "fast channel" for urgently-needed personnel concerning business, logistics, production and technological services, in order to minimize the impact of the epidemic on society and economy. You (the journalist raising this question) come from South Korea, and should know that China and South Korea first established such a "fast channel," and it has so far been doing fine. Based on our experiences with South Korea, China then established "fast channel" with Germany and Singapore. We will discuss with other countries around the world to establish "fast channel" on the premise of ensuring epidemic prevention and control in order to meet the needs of work and production resumption, and further boost the economy of China and the world. 

Wang Chen:

Prevention and control on an ongoing basis are a very important issue. It should first depend on the overall evaluation of the level of epidemic risks and emergency response. Correspondingly, there are relevant measures at each level. The whole society should act systematically based on the requirements of these rules and social management. We should find a balance between effective prevention and control and people's life and production. On May 7, upon the approval of the Central Leading Group for Novel Coronavirus Prevention and Control, through the Joint Prevention and Control Mechanism, the State Council released Guidelines on Conducting COVID-19 Prevention and Control on an Ongoing Basis. The document puts forward a series of measures and guidelines from five aspects and 20 key points as follows:

First, the emphasis is on prevention. It refers to measures taken to prevent the emergence of cases and their spread when there is no case. Wearing masks is recommended among citizens. Social distancing is encouraged and extra protection should be given to vulnerable groups. We should work to further improve people's health literacy through the COVID-19 pandemic, such as frequent hand-washing, mask-wearing when it is necessary, using serving chopsticks when dining in public places, covering up when sneezing or coughing, smoking control and quitting, to name a few.

Second, we should be extra careful that if new COVID-19 cases emerge, timely and effective measures must be taken. The principle of "early in four aspects" should be observed. First is early detection and response. Second is early reporting and swift social actions. Third is early quarantine to stop the virus from spreading. Fourth is early treatment to improve the effectiveness and prevent mild cases from turning critical.

Third, we should highlight the prevention and control of key links. We need to pay special attention to crowded locations, such as hospitals, nursing homes and schools and adopt special measures. We need to raise prevention and control awareness and we need to introduce reinforced measures. For vulnerable populations, such as the elderly and patients with chronic conditions, we will provide them with special protection measures, for if they are infected they are likely to become sicker and have a higher fatality rate than healthy people and those with relatively stronger bodies. The community is the key to pandemic prevention and control work, and it is often the starting place for the spread of the pandemic. It is necessary to make appropriate work arrangements according to the situation of the pandemic and the unique condition of each community. China has good experience with pandemic prevention and control at the grassroots level. These will be better reflected and put to use in future prevention and control work.

Fourth, we should provide more supportive measures. As General Secretary Xi Jinping emphasized, science and technology constitute mankind's most powerful weapon against diseases. As mentioned by Minister Wang Zhigang just now, a series of deployments and advancements have been made in scientific research and development, and many achievements have been made, too. Some available modern methods, such as big data, can be employed to improve the efficiency and effectiveness of pandemic prevention and control. In terms of international cooperation, in addition to China's own experience, it is crucial to develop international cooperation and learn from the pandemic prevention and control efforts of other countries as well as their scientific and technological progress. In promoting the building of a human community with a shared future, special emphasis should be given to international cooperation.

Fifth, we should strengthen organization and leadership. Party committees and governments played a key role during our fight against the COVID-19 pandemic. Governments make judgments on the risk level and response level so as to mobilize all parties in society to better prevent and control the epidemic, allowing for a sound arrangement of life and work.

Regarding the question about masks, Beijing has lowered its COVID-19 emergency response to level III. In this level, most people can actually choose not to wear a mask on most occasions. But it depends on the situation. First, one should be clear when and under what circumstances one needs to wear a mask as well as when they can abstain. For example, one does not need to wear a mask at open places, well-ventilated places or when proper social distancing is maintained. But when facing a patient with respiratory symptoms, staying in an enclosed and crowded space or at a hospital, one should still wear a mask. There is science behind wearing a mask. The Bureau of Disease Prevention and Control of the National Health Commission of the PRC and other relevant international healthcare institutions have all issued guidelines suggesting people should wear masks. In addition, people can always keep a mask at hand in case it is needed. Some key groups of people should wear masks, including those with certain occupations, such as people working in hospitals or in enclosed places, police, community workers who have close contact with others and vulnerable groups who are high risk if infected with the coronavirus, such as patients with chronic diseases and the elderly. Also, people with respiratory symptoms should certainly wear masks. Therefore, whether to wear a mask or not should depend on one's specific situation. Generally speaking, though, as China has achieved remarkable pandemic prevention and control progress, more people are able to take off their face masks on more occasions. Thank you.

The Times:

I have one question regarding China's relationship with the rest of the world, which has been negatively affected by the coronavirus outbreak. What measures will China take to repair its relationship with the rest of the world? 

Ma Zhaoxu:

I disagree with your assertion that China's relationship with the rest of the world has been negatively affected by the coronavirus outbreak. It is not true. The fact is that China's relationship with the majority of countries throughout the world has not been negatively affected by the outbreak; rather, its relationship has been further consolidated and improved. Our friends have become closer and our circle of friends has expanded. This is the truth. 

A friend in need is a friend indeed. As was especially noted in the white paper, when the situation in China was at its most difficult point, leaders of more than 170 countries, heads of 50 international and regional organizations and more than 300 foreign political parties and organizations expressed solidarity and support for China through phone calls, letters and statements. 77 countries and 12 international organizations donated emergency medical supplies to China. People of all countries supported China in different ways. We will never forget these precious acts of friendship.

Therefore, in the face of the increasingly severe global pandemic, China empathizes with other countries and reciprocates the same goodwill. We will do our best to provide support and assistance to all parties and share China's experience and solutions without reservation. The white paper elaborates on this. For example, as of May 31, China had offered aid supplies to 150 countries and four international organizations, sent medical expert teams to 27 countries and held more than 180 expert video conferences with more than 170 countries and international organizations. Local governments, enterprises, non-governmental organizations and individuals in China have donated materials to more than 150 countries and regions as well as international organizations through various channels. We have also facilitated the commercial procurement of Chinese products in China by various countries around the world. From March 1 to May 31, China exported protective materials to 200 countries and regions, including 70.6 billion masks and 340 million protective suits. These facts show that China shoulders its responsibility as a major country. The friendly relationship and practical cooperation between China and other countries in the world have also been greatly promoted. All of this proves that the COVID-19 outbreak actually improved the development of China's relationship with other countries in the world.

The international community has spoken highly of China's outstanding contributions to the global COVID-19 response. Let me quote from a leader of a developing country: "At this difficult time, China has not stayed on the sidelines, but stood with us and helped us. I would like to sincerely thank President Xi Jinping, the Chinese government and Chinese people." We have seen people in many countries hitting the "like" button for China on the internet, illuminating the lights of "China Red" in their cities, playing the Chinese national anthem in their communities and cheering "thank you China" on the streets. There are many more examples.

In sharp contrast, certain countries have gone against the historical tide. In order to shift the blame for their inadequate response to COVID-19, they pulled out all the stops to attack and smear China, creating and spreading political viruses. China will resolutely fight back against such buck-passing behavior. I want to emphasize that when faced with COVID-19, solidarity and cooperation are the most effective weapons. Surmounting difficulties by pulling together is the right way to go. 

Bloomberg News:

I want to ask about the search for the origins of the virus. Are there any updates you can share with us about how that is progressing? And how is international cooperation working to that effort?

Wang Zhigang:

Thank you for your question. As COVID-19 has spread around the world, we should search for its origin, trace its progression, find out where it came from and where it will go, and identify its transmission routes. These are the responsibilities of scientists around the world, and are also a key part of the scientific research into the pandemic. Since the outbreak, China has attached great importance to researching the origin of the virus, in order to study the natural history of its outbreak and progression, and discover the underlying scientific rules. We have made arrangements in this regard since the outset.

In terms of internal logic, determining the origin of a virus is a scientific issue that involves multiple disciplines, including epidemiology as Mr. Ma Xiaowei and Mr. Wang Chen mentioned just now, as well as pathogenic biology, molecular informatics, mathematical statistics and big data. In addition, the whole process of tracing the virus' origins requires very strict logic and solid evidence. So, we should rely on scientists and adopt a science-based attitude and approaches in our work.

At the same time, the only purpose of tracing the origin of the virus is to scientifically respond to the common threat against humankind, namely the novel coronavirus. Specifically speaking, on the one hand, it will allow us to prevent similar outbreaks from happening again. We need to find out where it came from, where it will go, how it parasitizes as a protein, how it poses a threat to human health, and how it is transmitted from animals. There are many assumptions. In short, we should serve one general purpose, which is to prevent similar outbreaks and learn how to deal with them if they happen. On the other hand, if we want to work out a scientific plan for preventing and controlling epidemics and treating diseases, we must trace the virus' origin in a more scientific way. Only by making the tracing work more scientific, effective and targeted, can we carry out the vaccine research and development, drug screening, new drug development, and the scientific research of testing reagents according to developments and changes in the virus. Therefore, that is our only purpose. This is a scientific issue, which should be carried out mainly by scientists. It is a scientific question that needs to be solved and answered. It is science that should be used to support the human response to the pandemic, and eventually stop it. 

The work to trace the origin of the virus is mainly being carried out by scientists, including those from the Chinese Academy of Sciences, the Chinese Academy of Medical Sciences, universities, and enterprises. They are playing a leading role by using various scientific methods, including pathogenic biology, molecular informatics, mathematical statistics, artificial intelligence, big data and other methods just mentioned, and focusing on tracing animals, crowds of people, molecules and the environment in a science-based way.

At present, some achievements have been published in academic papers. By the end of May, Chinese scientists had published 206 papers, overseas research teams published 282 papers, and Chinese scientists, U.S. scientist and British scientists jointly published 19 papers on the origin of the virus. A global information database has been built, collecting 36,442 COVID-19 gene sequences shared worldwide, of which 18,967 are high-quality virus sequences. These achievements are contributions made by scientists to determine the origin of the virus.

But we must recognize that tracing the origin of a virus has always been a scientific challenge throughout human history, especially when it comes to a new virus like the novel coronavirus. We still have a lot to learn about it. Next, we will continue to adopt a science-based attitude, rely on scientists, and carry out more research using scientific methodology. We should also respect science and hold a pure and simple attitude towards the research, that is, it should support our response to COVID-19 — the common threat to humankind. I mentioned this when answering questions on vaccines earlier: whether it is vaccines, drugs, prevention and control plans, diagnostic methods, or the construction of animal models — all of them need the backing of virus source tracing. Therefore, we are still working on it. The entire Chinese science and technology community is still researching and developing vaccines, screening drugs, and developing new drugs, as well as antibody drugs. These also need the support of virus origin tracing. 

Thank you. 

CRNTT:

Some foreign media have said that the Chinese government delayed releasing the genome of the virus for one week, and it is because China covered up the virus and its outbreak that caused it to spread across the globe. What do you think of this? Thank you. 

Ma Xiaowei:

I don't agree with what this foreign media had said, because it goes against the facts. Mr. Xu Lin responded to this earlier: the Chinese government did not delay or hide anything. Instead, it informed the international community of the virus data and the outbreak, making a great contribution to the global prevention and control work. The COVID-19 pandemic is the most extensive to afflict humanity in a century. It is a serious crisis and a daunting challenge for the entire world. Faced with such an unprecedented new virus, there were many things we didn't know during the initial outbreak, including its pathogen, incubation period, transmission methods, pathogenesis, its ability of transmission, source of infection, immunity of people, and so on. This is a process of accumulating evidence, of deepening our understanding, and of learning about its characteristics. We could say that even today, mankind still has a lot to learn about the virus.

Since the onset of the epidemic, acting with openness, transparency, and a high sense of responsibility, the Chinese government has quickly established a coping mechanism and has been carrying out aetiological and epidemiological studies in a race against time. It took eight days to identify the pathogen, and 16 days to successfully develop the detection kit. The Chinese government has informed the WHO and relevant countries about the epidemic outbreak, shared the genome sequence of the novel coronavirus, and launched international epidemic prevention and control in the first instance.

Here, I would like to give you a brief overview of the basic process. On Dec. 27, 2019, the Hubei Provincial Hospital of Integrated Chinese and Western Medicine reported the "pneumonia of unknown etiology" to the Center for Disease Control and Prevention in Jianghan district, Wuhan city. On Dec. 30, 2019, the Wuhan Municipal Health Commission issued an urgent notification to medical institutions under its jurisdiction, ordering efforts to appropriately treat patients with pneumonia of unknown cause. On Dec. 31, 2019, the National Health Commission (NHC) sent a working group and an expert team to Wuhan to guide an epidemic response. On Jan. 1, 2020, the NHC set up a leading group to determine the emergency response to the epidemic. On Jan. 3, 2020, China began to regularly inform the WHO, the U.S., and other countries about the pneumonia outbreak. On Jan. 7, 2020, the China CDC and other research institutions succeeded in isolating the first novel coronavirus strain. On Jan. 9, 2020, China shared with the WHO the initial progress in determining the cause of the viral pneumonia outbreak in Wuhan. On Jan. 12, 2020, China submitted the genome sequence of the novel coronavirus to the Global Initiative on Sharing All Influenza Data (GISAID) and shared globally about the information on the genome sequence of the novel coronavirus. In such a short time, China has identified a new infectious disease, including its pathogen and transmission route, and shared the information with the world. We can see that the Chinese government has adopted an open, transparent, and responsible attitude. On Dec. 31, 2019, the Hubei provincial government released its first briefing on its official website. Beginning Jan. 21, 2020, the NHC started to provide daily updates on epidemic activity on its official website. From Feb. 16 to 24, the China-WHO joint expert team conducted field visits to Beijing, Sichuan, Guangdong, and Wuhan. The team stated that China's decisive, powerful and timely measures had prevented hundreds of thousands of cases. This is a brief timeline of the early stages of the epidemic outbreak.

The timeline is very clear. The work of the Chinese government and Chinese scientists will stand the test of history and time. The virus knows no borders, and the pandemic knows no race. It's a challenge faced by all human beings, and only solidarity and cooperation can be the most powerful weapon for the international community to defeat the epidemic. This is the experience we have learned from our previous work with the international community in the fight against other major epidemics, including AIDS, Ebola, influenza A, and the H1N1 flu. The path we followed then is the correct one to continue to follow in the face of the current pandemic. Since the outbreak of the epidemic, upholding the concept of a community with a shared future for mankind, we have actively fulfilled our international obligations, closely cooperated with the WHO and relevant countries, shared epidemic and virus information with the international community, and provided material and technical assistance to more than 100 countries and international organizations within our capacity.

We will continue to fulfill our international obligations and make due contributions to epidemic prevention and control. Thank you.

The Associated Press of Pakistan:

China's epidemic prevention and control has been successful. Some media outlets believe that China has placed more emphasis on its institutional advantages and the roles of the Party and the government in the fight against the epidemic and has relatively ignored the overall efforts of the people. Do you have any comment on it? What role did the Chinese people play in the fight against the epidemic? Thank you.

Xu Lin:

First of all, I would like to point out that in China, the Party, the government, and the people are an entirety that is closely linked by flesh and blood. During the fight against COVID-19, Chinese people have played an enormous role. Doing all for the people and by the people is the starting point and goal of all the work of the CPC. The fight against the epidemic is no exception. In the battle against the epidemic, General Secretary Xi Jinping made two remarks that I think many of you are familiar with. One is that people come first, and lives come first. We are willing to protect people's life and health at all costs. The other one is that China will resolutely win the all-out people's war against the epidemic. These two remarks fully reflect the purpose and governing philosophy of the CPC and the main role of our people play in the fight against the epidemic. Under the strong leadership of the CPC, Chinese people have united as one and gained great strategic achievements in the fight against COVID-19 through arduous efforts. 

The general public served as the mainstay in the fight against COVID-19. Faced with the outbreak of an unknown virus, the Chinese people showed great faith in the leadership, the Party and the government. They courageously shouldered their social responsibility in the country's fight against the pandemic. The 1.4 billion Chinese people, irrespective of their gender, age, and occupation, shared a consensus that "protecting oneself was protecting others and making contribution to the country." They acted in unity, followed various measures on epidemic prevention and control, and voluntarily acted against the virus. People of different occupations joined the battle against the epidemic and contributed their due share. They united and cooperated to mount a collective response, demonstrating the profound love of the Chinese people for their family and their country. I would like to share with you stories of two persons in their 20s and how they showed their love and care for families and the nation.

One is about a young girl born after 1990 whose family of three were all diagnosed with COVID-19 and treated in different hospitals. In mid-February, her father died of severe symptoms. While coping with grief and her own illness, she pretended to be the father by signing on to his WeChat account every day and talked with her mother, giving her courage, strength and love. The mother and daughter were both discharged from their respective hospitals after the treatment. The strong-minded and smart girl has provided her mother with a will to carry on in the darkest moment.

Another story is about a young man from Changsha, Hunan province. Having known that people in Wuhan faced difficulty in carrying on essential outings after the lockdown, he posted "I do not fear death, but regret in this life" on social media. He then left his friends and family and drove to Wuhan. For a period stretching over dozens of days, he voluntarily drove medical workers to and from their work, and provided convenience to Wuhan residents in need. He was later named as the most lovable driver in Wuhan.

The two young persons are just examples of the national battle against COVID-19. This is also a true picture of the 1.4 billion Chinese people fighting the epidemic. All citizens share a responsibility for the fate of their country. They are filial, patriotic, kind-hearted, diligent, brave and tolerant. The Chinese people represent a formidable force in the fight against the virus. They are the source of strength in the development of the Chinese nation. Thank you.

Russian News Agency TASS:

At the 73th World Health Assembly, President Xi Jinping said China will provide US$2 billion over two years to help with the COVID-19 international response and with economic and social development in affected countries. What is China's plan to deepen and expand international cooperation in the COVID-19 response. Is China planning to work with Russia or other countries in vaccine research and development? Thank you.

Ma Xiaowei:

The global epidemic situation remains complex and grave. In the face of the most serious international public health emergency after the Second World War, many people are concerned about the future of the human community. At this historic moment, President Xi delivered an important speech at the virtual opening event of the 73rd World Health Assembly, introducing China's stance on fighting COVID-19 as well as a series of important initiatives and measures from the perspective of building a global community of health for all, which is of great and far-reaching significance to boost confidence, advance international cooperation in the battle against the COVID-19 and even strengthen global public health governance.

China has always been true to its words and resolute in its deeds. The measures announced by President Xi are now being implemented and making good progress. I would like to share with you some details about the implementation. The US$2 billion package not only includes providing anti-epidemic materials but also supporting economic and social development of the affected countries. China is negotiating bilateral aid arrangements with needy recipient countries in an equal manner to identify assistance projects to help developing nations improve their public health standards, people's livelihood, reduce poverty and resume normal economic activities. On the multilateral front, China has provided two batches of cash support totalling US$50 million to the WHO and made donations to international organizations like the Global Alliance for Vaccines and Immunizations. We also helped WHO's COVID-19 Solidarity Response Fund to raise funds in China. The establishment of a global humanitarian response depot and hub in China in cooperation with the United Nations is under discussion and preparations are under way. China has announced the suspension of debt repayments for 77 developing countries and regions and actively participated in and implemented the Debt Service Suspension Initiative for the poorest countries together with other G20 members. A cooperation mechanism for Chinese hospitals to pair up with 30 African hospitals is also in the pipeline.

Regarding your question about vaccines, Mr. Wang just explained that China has given high priority to international cooperation in terms of vaccine R&D. Our country has participated in the global initiative organized by the WHO for the R&D of specific medicines and vaccines. Not long ago, China joined hands with the WHO to hold a video conference aiming at promoting R&D from which experiments worldwide should be undertaken in great solidarity. China has committed to providing safe, effective and high-quality public products to the world once it has completed the R&D process and put the vaccine into use. It has also promised to contribute to the availability and affordability of vaccines for developing countries. These are commitments that we must fulfill.

China and Russia, in accordance with their comprehensive strategic partnership, have assisted and cooperated with each other since the outbreak of the pandemic. In the next phase, we will follow the significant consensuses reached between the leaders of the two states to expand our cooperation in pandemic prevention and control, including the vaccine R&D. That is how we are contributing to cementing the anti-pandemic efforts being taken by the entire international community. 

China Daily:

Following a series of efforts derived from the R&D for effective medicines and treatments against the COVID-19, China has formed its own anti-virus guidelines. Will China recommend its achievements abroad? How have these approaches, if they have been introduced, worked in other countries? Thank you. 

Wang Zhigang:

Medicine plays a fundamental role in ensuring people recover. Since the start of the pandemic, the R&D of drugs has been prioritized as the most critical effort and involves numerous essential projects being undertaken by more than 160 research institutes and enterprises. We commenced our efforts with "three medicines and three treatments." Specifically speaking, the three existing medicines we experimented on were supposed to take on new clinical efficacies, and the three treatments have been a combination of medical and therapeutic treatments. In different phases and trials that have been developed and refined around the principles of safety and efficacy, our scientists have worked day and night with the pharmaceutical industries which have demonstrated their strong will to join in making relevant products. In this way, we have made remarkable scientific achievements while experimenting on Resochin, favipiravir, carrimycin, tocilizumab, convalescent plasma therapy and stem cell treatment, to name just a few. Among them, 10 medicines and therapies have been included in the treatment plan. They acted as key scientific and technological approaches to save lives on the frontlines where the recovery rate has risen and mortality has fallen.  

We have taken several concrete steps in exploring the potential efficacy of existing drugs. These can be illustrated as follows: first, through the selection of medicines. By applying big data, we have filtered a wide range of medicines available on the market both based on our experience and by using a modern selective approach to identify which drugs are most likely to be effective. Second, we have conducted in vitro experiments, including cell and animal experiments, which have been followed up by small and scaled-up clinical trials before being incorporated in diagnostic and clinical treatments. Through these steps, we have identified specific medicines and recommendable treatments.

In addition to old drugs being used in new treatments, certain breakthroughs have been made in pharmaceutical research that were mentioned by both Mr. Ma at the NHC and Mr. Wang at the CAMS. First, TCM has played a vital role, which can be demonstrated by its own competence as well as by the synchronized efforts taken between it and western medicine, as the impact is indeed hard to ignore. Second, we have done a good job in taking simultaneous steps to both develop medicines and provide clinical treatments. The efficacy of medicines cannot be proven by molecular, animal and small-sized clinical experiments only — they should also be subjected to clinical trials. Only with a continuous cycle of reaction and improvement can the R&D and treatments be coordinated well. Third, interdisciplinary efforts including supercomputing, animal models and artificial intelligence have contributed significantly to selecting medicines and working on their efficacies. Fourth, the application of existing drugs for new uses has brought us some effective medicines, especially some antibody medicines for prevention and treatment, even though, they are not specific ones. Recently, a major breakthrough has been made with an antibody medicine being proven by the National Medical Products Administration and taken for clinical trials.

Regarding your question about recommending our achievements to the world, my answer is that we have been actively sharing our experiences in pharmaceutical R&D and clinical trials with other countries for them to choose whatever they find useful based on their own needs. In this aspect, we have communicated deeply with the rest of the world. As I mentioned, we have published many articles, communicated via numerous video conferences and held face-to-face meetings for exchange. Chinese research teams have published innumerable papers, shared scientific research achievements with more than 200 countries and regions, and supported international multi-center clinical trials with enterprises and relevant institutes. Notable progress has been made in view of these aspects. However, it is up to scientists and medical personnel overseas to tell whether the efforts can pay off in their countries through their practices and improvements while using our experiences. Thank you.  

Guo Weimin:

That concludes today's press conference. Thank you all.

.

Read in Chinese 

Speakers:

Ning Jizhe, deputy head of the National Development and Reform Commission (NDRC)

Cong Liang, secretary general of the NDRC

Zhao Chenxin, deputy secretary general of the NDRC

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

May 24, 2020

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are delighted to invite Mr. Ning Jizhe, deputy head of the National Development and Reform Commission (NDRC); Mr. Cong Liang, secretary general of the NDRC; and Mr. Zhao Chenxin, deputy secretary general of the NDRC. They will introduce China's efforts to accomplish its economic and social development goals for 2020, namely to ensure the six priorities and stability in six areas (employment, finance, foreign trade, foreign investment, domestic investment, and market expectations). They will also answer your questions.

First, let's give the floor to Mr. Ning Jizhe.

Ning Jizhe:

Friends from the media, my colleagues and I are pleased to be taking part in this press conference during the "two sessions." Currently, under the personal command and deployment of General Secretary Xi Jinping, positive results have been achieved in coordinating epidemic controls, and economic and social development. On the morning of May 22, Premier Li Keqiang's report outlined deployments and arrangements for the government's work this year. Also, on May 22, NDRC head He Lifeng took part in the "ministerial interview." The plans and report have been submitted to the "two sessions" for review and discussion. The NDRC will fully implement the decisions and deployments made by the CPC Central Committee and the State Council, adopting effective measures to ensure the accomplishment of the economic and social development goals for 2020. We also thank our friends from the media for their consistent support and understanding of the work of the NDRC. Next, we will answer your questions.

Hu Kaihong:

Thank you, Mr. Ning, for your brief opening remarks to allow us more time for questions. Now the floor is open for questions.

CCTV:

Economic statistics from the first quarter of 2020 show that consumption recovery has generally been comparatively slow. Therefore, many people online have spoken of their desire to indulge in "retaliatory consumption" after the epidemic situation improves. However, in the meantime, statistics from China's central bank also show an increase in deposits during the first quarter. Some people have therefore said that "retaliatory saving" is taking place. So, what exactly is happening? is it "retaliatory consumption" or "retaliatory saving"? How does the NDRC evaluate the epidemic's impact on consumption? What measures will be introduced next to boost consumption? Thank you.

Ning Jizhe:

That is a good question, and one which is of great concern to people both in China and overseas. As you've said, the COVID-19 pandemic has had a huge impact on the economy, primarily affecting consumption sectors. People's aggregate, liquidity, and contact consumption behaviors, as well as the consumption of non-essentials, have been affected. In the meantime, we should also note that new consumption models are expanding, such as online consumption and e-commerce. These have ensured the basic needs of 1.4 billion people, and contributed to the resumption of work and production of companies.

China's retail sales of consumer goods dropped 7.5% in April year-on-year, the decline of which narrowed by 8.3 percentage points from March. This also indicates that as the economy continues to recover and work and production resume, the general trend of expansion and structural upgrading of China's consumption remain unchanged. We believe that consumption data for May will be better. As for whether this is "retaliatory consumption," that is not necessarily correct. Consumption is certainly moving towards recovery. Next, the NDRC will follow the requirements set out in the Report on the Work of the Government, adopting multiple measures to help consumption recover.

First, the NDRC will make greater efforts to promote the optimization and upgrading of commodity consumption mainly concerning people's everyday lives. In terms of diets, the NDRC should ensure people are not only well-fed, but also eating in a healthy manner. As for clothing, the NDRC should work to ensure that people can dress both warmly and decently. In terms of items people use, the NDRC should work to ensure that things provided to people are not only useful, but also diverse and of high-quality. The housing and rental markets need to be further developed. Greater efforts need to be made to renovate the city's old neighborhoods in a more convenient and age-friendly way, so that residents can live comfortably. The NDRC will further promote the optimization and upgrading of car consumption, as well as the circulation of second-hand vehicles. It will work to implement favorable policies concerning fiscal and taxation support regarding the purchase of new energy vehicles (NEVs), so as to make traveling easier for people. In the meantime, the NDRC will comply with the trend of people's consumption being upgraded, strengthening the development and supervision efforts of commodity brands, quality, and manufacturing standards, so as to continuously optimize people's consumption environment and improve the level of consumption.

Second, the NDRC will work to improve the quality and scale of consumption-related services in a comprehensive manner. Considering the progress of supply-side reforms in the service industry, the NDRC will release the potential in consumption-related services at an accelerated pace, such as those in the culture, tourism, sports, elderly care, child care, housekeeping, education and training sectors. It will work to diversify the supply of cultural and tourism products, improving the quality of tourism in China and promoting the development and prosperity of China's cultural undertakings and culture industry. The NDRC will also make greater efforts to boost sports-related consumption, making fitness programs and sports-watching activities accessible to all. Currently, 400 million people exercise daily in China. If this figure reaches 800 million, then the sports market will double. The NDRC will work to improve effective supplies for elderly care services, supporting private sectors in making affordable child care services accessible to all. It will carry out the "leading" campaign to improve the quality and scale of housekeeping services. The NDRC will promote integration between industries and schools, supporting private sectors in launching educational and training programs.

Third, we will boost new forms of consumption, including digital consumption, online consumption and information consumption. From January to April of this year, online retail sales of physical goods increased nationally by 8.6% year-on-year, accounting for 24.1% of the total retail sales of consumer goods — which increased by 5.5 percentage points year-on-year — and showing the strength of new forms of consumption. We must take the opportunity to further promote the integration of online and offline consumption and advance the digital upgrading and transformation of traditional in-store consumption. We will innovate non-contact and reduced-contact consumption patterns and explore the new retail models, such as smart supermarkets, stores and restaurants. We will vigorously develop the "internet plus social service" consumption model and expand forms of online consumption, such as online education, telemedicine and online entertainment. We will actively develop new information products, such as mid- to high-end mobile communication terminals, wearable devices and ultra-high-definition video terminals, to promote the upgrading of information consumption.

Fourth, we will actively expand green, healthy, energy-saving and environment-friendly consumption. Guided by green development, we will promote the production, supply and consumption of green, organic ecological and agricultural products. We will step up the improvement of the recycling network to facilitate resource recycling and promote the upgrading of motor vehicles, home appliances and electronic products. For some idle home appliances and electronic products, we can recycle them as a contribution to consumption upgrading. We will optimize the standard system of industrial energy saving and green manufacturing, and promote the application of green and energy-saving products. While responding to the COVID-19 epidemic, we will call for all of society to develop a rational concept of consumption and a healthy lifestyle, and encourage families to keep medical kits that include masks in reserve. Our nation is home to more than 400 million families, and everyone should develop the awareness and habit of storing up medical supplies. We will integrate and optimize medical and health resources and relevant supply chains, and improve the health industry system to expand health services consumption.

Fifth, we will strengthen the infrastructure and service systems of consumption. We will accelerate the construction of new infrastructure that can support 5G networks, data centers, industrial internet, the Internet of Things, etc. We will improve the urban and rural logistics distribution system and promote resource sharing and the construction of smart parcel delivery lockers and other facilities. We will optimize the consumer network, turn more cities into international consumption centers and build a number of regional centers equipped with advantages in resource integration that can drive consumption. We will promote the construction of urban and rural commercial outlets and optimize the planning and distribution of commercial retail enterprises; this will include developing the small business economy and the night economy. These are all promising areas. Thank you.

Nihon Keizai Shimbun:

China didn't set an economic growth target this year, which is something that has rarely been seen in history. When was the last year that China abandoned a GDP target? In addition, facing unprecedented challenges, how can China ensure the achievement of its economic and social development goals and tasks this year? Thank you.

Ning Jizhe:

I am happy to answer questions from Japanese reporters. A few months ago, anti-epidemic supplies from our Japanese friends with the poem "Miles Apart but Close at Heart" written on the boxes were donated to China, and got a positive reaction. I would like to take this opportunity to thank our Japanese friends and thank you for your question.

Speaking of the economic growth targets, this is not the first time that we have dropped a specific target in a government work report. Since the reform and opening-up, there have been three years — 2000, 2001 and 2002 — when we set no annual growth targets in our government work report. It is the fourth time this year. You can check the reports. 

We have not set a specific target for economic growth this year because our country is facing some factors that are difficult to predict in its development due to the great uncertainty surrounding the COVID-19 epidemic and the world economic and trade environment. The targets for development outlined are "giving priority to stabilizing employment and ensuring living standards, winning the battle against poverty, and achieving the goal of building a moderately prosperous society in all aspects." This shows that our development is centered on improving people's lives, and we consider employment to be a priority. It also reflects that our key goal and task is to win the battle against poverty — one of the three tough battles. It points to the connection of development goals set in the final year of the Twelfth Five-Year Plan and the first Centenary Goal of building a moderately prosperous society in all respects.

No mentioning of a specific economic growth target in this year's Government Work Report by no means indicates a less essential role of growth, which serves as an underpinning for ensuring people's livelihood, employment and poverty alleviation. We should pursue reform and opening up as a means to stabilize employment, ensure people's wellbeing, stimulate consumption, energize the market, and achieve stable growth. Though no growth target was set in the Report, it is in fact reflected in relevant indicators for other economic and social development goals.

Now, I will respond to your question about how to achieve our goals. Since the beginning of the year, we have been facing an extraordinary environment both at home and abroad due to the unprecedented impact of the COVID-19 outbreak, and our economic development also been exposed to unprecedented challenges. However, there are always opportunities arising amid crises so long as we surmount the difficulties. After effectively bringing the outbreak under control, China is regaining a steady momentum for economic recovery and improvement. In our next phase, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the NDRC will, in accordance with the requirements in the Government Work Report delivered by Premier Li Keqiang, make solid efforts to ensure stability on the six fronts and security in the six areas, maintaining security to deliver the stability needed to pursue progress and striving to accomplish our annual economic and social development goals. We will strengthen our efforts in the following six aspects: 

First, increasing efforts will be made to secure employment and livelihood. This year, we will give priority to stabilizing employment and ensuring living standards, with a focus on key groups including college graduates, migrant workers and laborers from poverty-stricken areas. In regard to the employment of 8.74 million college graduates this year, we will increase job vacancies in enterprises, expand enrollment in postgraduate schools and open more positions at community-level units. Meanwhile, we will encourage business start-ups as a means to create more jobs. Our public employment services will cover all urban and rural permanent residents (including migrant workers), so as to help more than 200 million migrant workers and tens of millions of workforce in poverty-stricken areas find jobs. We will encourage infrastructure projects to employ more rural labor force and ensure they can work locally and close to their homes. With proper jobs and income, people can enjoy a better life.

Second, we will strengthen our poverty-alleviation efforts. Winning the fight against poverty is an important target and arduous task we must fulfill this year, and we will enhance our poverty-alleviation efforts with employment, industrial development and consumption. We will utilize investments and construction to help people shake off poverty, and exert efforts to overcome the epidemic's impact and accelerate launching or resumption of poverty relief projects. We will expand the scope of the work-relief programs to cover more beneficiaries, and the NDRC has already allocated relevant funds to be distributed in batches throughout the year. Last year, we generally completed our task to relocate people from inhospitable areas a year ahead of schedule in accordance with the "13th Five-Year Plan". From this year on, we will establish more detailed follow-up supportive measures to improve services and facilities including education and healthcare in large resettlement areas, and consolidate our progress in poverty alleviation.

Third, focused policies will be introduced to mitigate the impact of the outbreak. We will pursue a more proactive and impactful fiscal policy, as well as a prudent monetary policy that is more flexible and appropriate, and another package of policies devised to prioritize employment, stimulate consumption, calibrate investments for vulnerable areas, refine industrial structures, differentiate targets for different regions and promote market-oriented pricing. When combined, they can effectively reduce the epidemic's impact.

Fourth, we will strengthen domestic demand to support the economy. We will continue to deepen the supply-side reform, hold firm to the strategy of expanding domestic demand, expand consumption, promote investment and explore potential markets in both urban and rural areas. Based on a population of 1.4 billion people, including a more than 400 million middle-income group, we will promote both traditional and new consumption areas. In regard to investment, we will leverage the 600 billion yuan for investment from the central government budget, special local government bonds worth 3.75 trillion yuan, government bonds approximating hundreds of billions yuan to be issued especially for anti-epidemic efforts and additional financial funds and social capital to address inadequacies and shore up points of weakness.. In this way, we can take great strides in terms of both traditional and new investments. In regard to urbanization, we will endeavor to bring 100 million rural residents to settle down in cities and towns, renovate 39,000 old urban residential communities and support the construction of a new-type urbanization piloted in about 100 counties and county-level cities.

Fifth, assistance to enterprises will be reinforced. We will accelerate our implementation of the policies assisting the development of enterprises and launch a new package of policies as outlined in the Government Work Report. We will adopt multi-faceted measures to help 100 million market entities, especially micro, small and medium-sized enterprises and self-employed people, resume work and production to foster the micro-economic basis that can guarantee employment and stabilize economic growth.

Sixth, the reform and opening up will be strengthened. We will fully implement two major documents recently issued – "The Guideline on Accelerating the Improvement of the Socialist Market Economic System in the New Era", and "The Guideline on Improving the Market-based Allocation Mechanism of Production Factors" – to deepen our reforms to streamline administration and delegate power, improve regulation, and upgrade services. That is how we can improve our business environment, and unleash and develop productive forces. We aim to raise our new institutions of the open economy a notch higher and to continue overall opening-up in a wider, broader and deeper way. Thank you.

Economic Daily: 

The epidemic has had great impact on global supply chains and industrial chains, and some countries have accelerated the withdrawal of their enterprises. My question, therefore, is: what challenges might be imposed on China's supply chain and industrial chain? How can we further upgrade the supply and industrial chains while ensuring their stability and competitiveness? Thank you.

Cong Liang:

Thanks for your questions. As you mentioned, the sudden outbreak has had great impact on China's economic and social development. Under the leadership of the CPC Central Committee and the State Council, regions and departments together have rolled out 90 targeted and powerful policies and measures covering eight aspects, including alleviating the difficulties facing enterprises, smoothing circulation of the supply chain, working in a synergistic way to achieve full resumption of production, and accelerations in the resumption of work on major projects. As things stand, the measures have taken effect as the enterprises resumed work so that production has been enabled to gradually approach or has reached the normal level. The statistics on electric power production is the most telling. According to statistics, this contracted by 4.6% in March year-on-year, and then increased by 0.3% in April year-on-year. The latest figures show that energy production in the first 20 days of May increased by 5.2% year-on-year, and was a gain of nearly 10 percentage points compared to March.

At the same time, however, the outbreak has continued to spread overseas, and this has severely hindered global economic and trade activities, interrupted global industrial and supply chains and increased uncertainty and instability. Our country has become deeply integrated with global industrial chains, so, inevitably, it has been impacted and influenced. It's necessary to spare no effort to ensure the stability of both the industrial and supply chains, which is one important part of the work of maintaining security in six areas as well.

At the same time, while consolidating and expanding the anti-virus achievements, the National Development and Reform Commission intends to further implement the details of the established policies, go all out to maintain the stability of all industrial and supply chains and constantly improve their competitiveness.

We have to ensure that all the various chains involved can circulate in an unimpeded way, by further alleviating the difficulties faced by enterprises and implementing the established policies on fiscal taxation, finance, social security, labor and rentals. These policies have already been introduced and are to be retained until the end of the year. The key is fully implementing the policies to help enterprises, especially these micro, small, and medium-sized ones to stabilize production and overcome any hardships they face. We should focus on getting through any bottlenecks and overcoming barriers appeared in the major industrial chains and significant investment programs, strengthening the key support elements for leading enterprises, synergistically promoting holistic work resumption in regard to upstream-downstream industries, production, sales and supplies as well as large, medium and small enterprises. Although some large enterprises have resumed production, the lockdown of some small enterprises can impact the circulation involving the whole industrial chains. Only by achieving synergy among large, medium and small enterprises can we achieve a full resumption of work and production. At the same time, we should optimize the supply chain system, coordinating domestic and overseas logistic resources to guarantee there are no blockages in railways, civil aviation and sea transportation. 

We also should make efforts to improve the various industrial and supply chains. It requires us to consolidate the advantages of traditional industries, strengthen the leading role of competitive industries, and support enterprises to upgrade their technologies and overcome bottlenecks. It also demands us to improve weak links and increase the resilience of industrial chains. We should also focus on advancing the development of industrial bases and modernizing industrial chains. Meanwhile, we should promote the digitalization, encourage enterprises to accelerate this aspect in their supply chains and improve flexibility and collaborative capacity. Additionally, we should launch pilot projects deeply integrating an advanced manufacturing industry and a modern service industry, striving to develop new industries, new business forms and new patterns, and fostering and expanding new growth points and poles.

Lastly, I would like to emphasize that ensuring the stability of global industrial chains and supply chains cannot be done by one country. The international community needs to enhance cross-border cooperation, jointly confront the challenges, contain the virus as soon as possible, push forward the return of industrial development back onto the normal track and promote dynamic circulation and healthy development of economic and social systems. Thank you.

Reuters:

The government work report has set a target of adding over nine million urban jobs. How many of these job opportunities are expected to be given to migrant workers? Many migrant workers received no income in the first quarter of 2020. What was the extent of their losses? Thanks.

Zhao Chenxin: 

Thanks for your question. You are mainly interested in jobs, especially the employment of migrant workers. Actually, what Mr. Ning said just now did touch upon some employment issues. The CPC Central Committee and the State Council attach high importance to employment. Among the "six areas" and "six fronts" on which the government has vowed to maintain security and ensure stability, job security and employment are first. In the face of the COVID-19 epidemic this year, many enterprises have struggled and some jobs have lost. As Mr. Cong Liang said, various departments, under the leadership of the CPC Central Committee and the State Council, have issued a series of policies and measures to cushion the impact of the epidemic. The aforementioned policies and measures include 90 items focusing on eight aspects. They have been adopted to help enterprises solve real problems and tide over their difficulties. All in all, the focus is to maintain employment stability and ensure people have access to jobs and steady income.

In fact, these policies and measures offer huge supports to enterprises in terms of tax and fee cuts and financial support. As we have learnt from field investigations, many enterprises have seen tremendous improvement in terms of their business operations and employment. The latter has changed for better. I would like to share a figure with you. Between January and April, a total of 3.54 million urban jobs were added nationwide, which I think is a very outstanding report card. In the face of the epidemic, the job growth in China is awe-inspiring compared with that in other countries and regions. From this record card and other data that Mr. Ning and Mr. Cong mentioned, we can see that Chinese enterprises do face some difficulties and every possible means should be taken to help them resolve their problems. At the same time, we should have confidence that the Chinese economy will sustain sound development, and we should have confidence in the resilience of the Chinese economy and the vitality of Chinese enterprises.

As you said, the government work report does set the target of adding over nine million new urban jobs this year. I would like to give you a breakdown. A large portion will go to graduates from colleges and vocational schools and demobilized military personnel. Of course, some of them will go to migrant workers. I would like to share another figure. As the resumption of work and production progresses, over 90% of migrant workers have returned to their posts, and this figure will surely increase as we advance our work in this regard.

You also asked about the income of migrant workers. Affected by the epidemic, some migrant workers have seen their incomes drop temporarily. As China has established a regularized epidemic prevention and control mechanism, along with restoration of economic and social order, the economy will prosper and migrant workers' income will surely increase.

In addition, I would like to add four points in regard to employment. First, we should strengthen macro-regulation with employment as a priority. This is what various departments are doing right now. We will continue to give priority to employment in all our policy tools. Second, we will further promote full resumption of work and production and reach targeted production capacity as soon as possible. Though the overall situation is good, we should pay more attention to "synergy." We should strengthen synergy between upstream, midstream and downstream industries, between production, supply and sales chains, and between small, medium-sized and large enterprises. Only through synergy can we truly realize full resumption of production and restore the targeted production capacity. Third, as Mr. Ning said, we will boost employment through encouraging entrepreneurship, press ahead with reforms to streamline administration, delegate powers, improve regulation, and upgrade services to create a good environment for businesses. Fourth, we should pay attention to key enterprises, industries and social groups. As Mr. Cong said just now, key enterprises and industries include foreign trade companies, micro, small and medium-sized businesses, and private companies. Key social groups include graduates from colleges and vocational schools, demobilized military personnel and migrant workers. We will boost support for all of them. 

In the end, I would like to say that employment is the root of people's well-being and the source of fortune. The NDRC will work together with other relevant departments to unswervingly implement the decisions made by the CPC Central Committee and the State Council. We will do a better job in securing employment to make sure "people will always hold firm their rice bowl." Thank you!

China News Service:

We noticed that a large number of large-scale foreign investment projects were launched in China since last year. What are the prospects for China to attract foreign investment this year amid the pandemic? Will there still be large projects implemented in China? Thank you.

Ning Jizhe:

As China opens its market and improves its investment environment, it is seeing an increase in large-scale foreign investment projects, which has become a prominent feature in use of foreign capital in the past two years. For example, during last year, Samsung's $15-billion flash memory chip project (phase II) in Xi'an completed plant construction, and BASF's $10-billion petrochemical project in Zhanjiang was officially launched. Tesla's $7-billion super factory project in Shanghai was built and went into production and delivered products to customers in the same year. During this year, BMW Brilliance's third factory project in Shenyang held a ceremony marking the start of the construction on April 1. ExxonMobil's petrochemical complex project in Huizhou held a "cloud construction" ceremony at three localities in the two countries on April 22. These all play a demonstrative and leading role in stabilizing foreign investment and promoting opening up. There will be a number of major foreign investment projects successively implemented this year, involving electronic information, new materials, advanced manufacturing and other fields. The NDRC will promote opening up, and maintain stable foreign investment, industrial chains, and supply chains in accordance with the requirements in the government work report, so as to achieve the "four furthers":

First, further promoting the implementation of major foreign investment projects. In addition to advancing the previous 18 projects in three batches, the fourth batch will be launched this year. We will coordinate services and offer support in land use, environmental impact assessment, planning, energy consumption and other aspects. We will increase the reserves of various projects in advanced manufacturing and production-oriented service industries. We will establish and improve the local leadership mechanism for major foreign investment projects, so as to comprehensively improve services. We will also facilitate the exchanges of international economic and trade personnel of some projects through a "fast-track lane" and charter flights, so as to support a faster implementation of the projects. Over 1,000 South Korean technicians working in China have resumed their work through charter flights. The efforts we have made have worked.

Second, further shortening the negative list for foreign investment. We will release the 2020 version of the negative list. The number of items in the negative list has already been cut to 40 over the past three years from 93. We will continue shortening it in accordance with the requirements in the government work report, further open up the service industry, manufacturing and agriculture, continue experiments in the pilot free trade zones, and fully implement the negative list management system. No separate restrictions on foreign investment beyond the list will be imposed. The NDRC has organized the removal of dozens of restrictions set by some organizations and government departments to put the foreign investment law into practice.

Third, further encouraging foreign investment. We will also release the 2020 catalogue of industries in which investment is encouraged. More items will be added to promote higher-quality manufacturing and tap into the potential of the country's central, western and northeastern regions in accepting relocated industries, so that more foreign investment can be covered by the preferential tax policies.

Fourth, further improving the foreign investment environment. Taking the opportunity of implementing the foreign investment law and its implementation regulation, we will improve systems of investment promotion, protection and management, improve foreign investment services, comprehensively promote equal treatment of Chinese and foreign enterprises, protect the legitimate rights and interests of foreign investors in making investment, and promote consistent and coordinated law enforcement in different localities. We will also strengthen exchanges with foreign chambers of commerce and foreign enterprises, and continue addressing problems encountered by foreign enterprises in China in resuming work and production. Thank you.

Bloomberg:

Earlier, you mentioned special bonds and how China is increasing them at the local level to deal with the impact of the COVID-19 pandemic. Is there concern that this will add to local debt pressure, and how can you balance the need for growth with the need to address problems with debts? Thank you.

Ning Jizhe:

This question is very important. I would like to invite Mr. Cong to answer it.

Cong Liang:

Thanks for your question. This is an excellent question, which focuses on a hot issue that has raised a lot of concern. Maintaining a reasonable debt level is conducive to social and economic development, and appropriate social and economic development is also conducive to controlling debt levels. I want to use some data to answer your question from three perspectives:  

First, we will be realistic and raise or reduce debt levels in line with different situations. When the economic performance is declining and demands in domestic and foreign markets are decreasing or contracting, it is necessary to increase government debt levels and increase effective demand appropriately. However, if the economic performance is increasing and demands in domestic and foreign markets are sufficient, government debt levels will be appropriately reduced to reduce total demands. This is something inherent in counter-cyclical adjustments. Currently, raising government debt levels is an extraordinary measure for an unusual time, which has been explained clearly in the government work report delivered by Premier Li Keqiang. Given the sudden impacts caused by the COVID-19 pandemic, a proactive and impactful fiscal policy must be more effective. These fiscal and tax measures were made after careful research, repeated calculations, and comprehensive consideration. They are in line with both China's economic development and the need for debt risk prevention and control. The extra one trillion yuan of fiscal deficit and the one trillion yuan of government bonds for COVID-19 control will be transferred in full to local governments and go straight to prefecture and county governments to directly benefit businesses and people. These funds will be primarily used to ensure employment, meet basic living needs, and protect market entities. This includes giving support to cut taxes and fees, reduce rents and interest on loans, and increase consumption and investment. These special local government bonds should produce benefits, and the financial size shall be balanced with project benefits, which will give rise to financial assets. 

Second, we shall understand this issue in a dialectical manner. China's current deficit ratio is not very high globally. In response to the COVID-19 pandemic, deficit ratios among nations are increasing dramatically. The IMF expects that global fiscal deficits will increase from 3.7% in 2019 to 9.9% in 2020, and deficits in developed economies will jump to 10.7% from 3%, with the United States increasing by nearly 10 percentage points to 15.4%, France to 9.2%, the Untied Kingdom to 8.3%, and Japan to 7.1%. The average fiscal deficits of emerging markets and middle-income countries will reach around 9%. Therefore China's overall deficit level is relatively low. 

Third, we shall be cautious to ensure that the debt risk is controllable overall. The CPC Central Committee and the State Council have attached great importance to the debt risk prevention and control, and regard it as one of the major tasks of the "three tough battles" (preventing financial risks, reducing poverty and tackling pollution). China's government debt ratio was 38.5% by the end of 2019, much lower than that of major developed and emerging economies. For example, the debt ratio of the United States was 106%, the European Union 80%, Japan 238%, India 69%, and Brazil 92%. 

In general, it is feasible, safe, and necessary to raise deficit ratio appropriately and issue special bonds to deal with the COVID-19 pandemic. Such fiscal policies are not only conducive to stabilizing China's economy, but also the global economy. Thank you.  

Ning Jizhe:

Please allow me to add one more point. To deal with the relationship between debt and economy, and give full play on the proactive role of local government debt in boosting social and economic development, the funds coming from the special bonds at the local level will be used for projects in three categories. First, they will be used for major strategic projects designed by the CPC Central Committee and the State Council. Second, they will be used for public welfare projects with certain returns. Third, they will only be used for capital expenditure, not for running expenses. These funds will mobilize private capitals to promote effective investment, expand domestic demand, and maintain growth, which will produce more effective assets.  

I want to make clear that the market economy, from the perspectives of accounting and statistics, is an economy of assets and liabilities. Every company has a balance sheet, so does a country. According to requirements of the Third Plenary Session of the 18th CPC Central Committee, the National Bureau of Statistics has compiled national balance sheets. The latest balance sheet shows that China's total assets have surpassed 1,300 trillion yuan. This asset did not come out of thin air. It is the achievement of years of investment and development. Our infrastructure construction, including transportation, telecommunication, energy, water conservancy, and municipal engineering, has produced effective assets thanks to the support of such investment. We have the most complete industrial system in the world with the most sophisticated classification. Therefore, we will promote some reasonable debt investment to produce a large number of effective assets, which will lay a more solid foundation for economic development and ensure people's well-being. Thank you. 

People.com.cn: 

China has made significant achievements in its response to COVID-19, which have been highly commended by the international community. However, throughout the course of fighting COVID-19, many weak links were also exposed, such as response to major epidemics, emergency medical aid and the emergency supplies reserve. What will you do next to strengthen weakness? Thank you.

Zhao Chenxin:

Thank you for your question. You made a very good point that the international community has highly commended China's epidemic prevention and control. And that is true. In the face of COVID-19, which is a common enemy of the whole world and mankind, we have pooled an unprecedented energy from all reaches of the country. General Secretary Xi Jinping has personally taken charge and planned our response. Under the strong leadership of General Secretary Xi Jinping and the CPC Central Committee, the overall epidemic response has demonstrated China's strength, spirit and efficiency. China's contribution to the global fight against COVID-19 is known to all countries and highly appreciated by forces of justice around the world. Currently, we have entered a stage of further consolidating our gains in epidemic response and conducting a review of our work. During this time, we should review effective practices and successful experiences gained from our epidemic prevention and control work.

At the same time, as you just said, we are also keenly aware of some weak links in responding to major epidemics and ensuring an emergency supplies reserve. We should consider this practically and clear-headedly. In compliance with the requirements of the CPC Central Committee and the State Council, the National Development and Reform Commission (NDRC) has been making adjustments in light of these weak links to optimize the composition of investments from the central government budget. We are now focusing on five major tasks in order to close loopholes and strengthen points of weakness in related areas. Here I would like to brief you on five major tasks.

First, we will build capacity for testing of major infectious disease as well emergency response. We will accelerate improving conditions and promoting upgrades at facilities and for equipment at disease prevention and control institutions. We will also strive to ensure that each province (the autonomous region, municipality) has a biosafety level 3 (P3 laboratory) laboratory and each prefecture-level city has a biosafety level 2 (P2 laboratory) laboratory as soon as possible. By doing so, we will significantly raise the country's ability of rapidly testing, identifying and responding to major epidemics.

Second, we will enhance our capabilities for centralized treatment of patients with major infectious diseases. We will set up a centralized treatment system for major infectious diseases that supports municipalities, provincial capitals and large-scale prefecture-level cities. We will build infectious disease hospitals or relatively-independent infectious disease wards in comprehensive hospitals. Prefecture-level cities with small populations will be required to select qualified hospitals as designated hospitals for the treatment of infectious diseases. Considering our campaign to strengthen points of weakness, we will also ask county seats to build more county-level hospitals. Through capacity-building at different levels, we will establish a tiered, classified system for large-scale infectious disease treatment. Meanwhile, we should increase the flexibility and resilience of the system so that we can be well prepared and able to act with confidence in the event of a sudden epidemic outbreak.

Third, we will upgrade and revamp treatment bases for major epidemics. We will give full consideration to the specific situations of different provinces, such as their population size, and support each province (including autonomous regions and municipalities) to upgrade one to three treatment bases for major epidemics based on their local high-level medical institutions, whether these institutions of a TCM and Western medicine focus. The construction of such treatment bases should take into account their operation both in normal times and during major epidemics. In normal times, the bases will admit and treat those who are severely and critically ill; during major epidemics, however, they will provide centralized treatment of patients. In addition, these bases will build up emergency supplies for the treatment of severe patients and the care of ordinary patients. They will also store the facilities and equipment for makeshift hospitals. These resources should meet the demands of local hospitals for their regular operations, and in the event of a major epidemic outbreak, they will operate according to national deployment. 

Fourth, we will upgrade and construct quarantine sites for major infectious diseases. After accumulating experience from the construction of makeshift hospitals in Wuhan, we will encourage local authorities to fully consider the emergency demand of newly built or under construction projects, including large gyms, sports facilities, exhibition halls and convention and exhibition centers. They should take into account venue design, ventilation systems, logistical systems, water and sewer pipes and reserved access points. Meanwhile, contingency plans should be developed in case major epidemics or emergencies occur, allowing these sites to be quickly transformed into places where mild cases are treated or quarantines are carried out.

Fifth, we will establish a solid system that ensures emergency supplies are on hand. This includes three parts. First, improvements to the purchase and supply system of emergency resources should be made. We will coordinate domestic and international suppliers to ensure the purchase and supply chain is safe and reliable. Second, a relatively strong emergency supplies reserve system should be set up. To do this, we encourage the participation of multiple parties in order to create synergy between the government, enterprises and public institutions, society itself and households. Third, our capacities to produce, allocate and transfer emergency supplies should be raised so that we can produce, supply and replenish emergency materials quickly and constantly whenever needed. In addition, a multi-party coordination mechanism is needed for the allocation and transfer of emergency supplies.

The said five major tasks is I want to introduce. These tasks are both very important and very urgent. We will conscientiously implement the requirements of the CPC Central Committee and the State Council, and we will make all-out efforts to complete the five tasks successfully as soon as possible. This will allow us to build a firm protective barrier that safeguards the lives and health of people, and it will also safeguard our national security. That's all for my answer. Thank you.

The Poster News APP:

China has put forward a series of significant regional development strategies, and regional economic structure is increasingly optimized. What new measures will be adopted to balance regional development this year? 

Cong Liang: 

Thank you for your question. General Secretary Xi Jinping stressed that in view of the new conditions efforts should be made to improve regional economic planning featuring complementary advantages and high-quality development according to objective economic rules. This year, the pandemic heavily impacted social-economic growth, and have a severe effect on regional development. This situation requires us to expedite the implementation of regional development strategies and boost balanced growth so as to accelerate the cultivation of growth drivers that will ease the effect of the pandemic. Efforts should be made in the following four respects:

My first point is this: High-quality growth drivers should be fostered around the country. In 2019, the GDP of the Beijing-Tianjin-Hebei region, the Yangtze River Delta region and the Guangdong-Hong Kong-Macao Greater Bay Area reached 8.5 trillion yuan ($1.19 trillion), 23.7 trillion yuan and 11.4 trillion yuan respectively. This accounts for 44% of the national total, and these three major drivers of the economy have come to constitute an "engine" of economic development. We must bring into full play the leading role of the above regions in order to achieve a high-quality regional development of the entire country.

One aspect of this is that we should push forward the coordinated development of the Beijing-Tianjin-Hebei region. We should make policies that aim at and create pressure for an orderly relocation of all non-essential functions from Beijing, the national capital, to neighboring locations. Major construction projects in the Xiong'an New Area should be expedited to build a structure. The high-quality development policies will be tailored for the Beijing's sub-center.

Another aspect is that we should press ahead with the construction of the Guangdong-Hong Kong-Macao Greater Bay Area. We should continue to uphold the policy of "one country, two systems," act in accordance with laws and regulations, promote scientific innovation and upgrade industries. We should advance the combination and coherence of rules, particularly those between Hong Kong and Macao, and the Chinese mainland, which will improve the happiness, sense of gain and security of the residents living in the Greater Bay Area.

A third aspect is that we should speed up the coordinated development of the Yangtze River Delta region. Initial progress should be made in demonstration zone of the Yangtze River Delta region, the Shanghai pilot Free Trade Zone and other major zones by implementing the coordinated development planning outline.

My second point is this: We should strengthen the ecological protection and quality development of major rivers, particularly the Yangtze River and the Yellow River. On the one hand, we should accelerate the development of the Yangtze Economic Belt, increase funds provided by the central government for its ecological environment restoration and protection, jointly improve the mechanism of well-coordinated environmental conservation and accelerate the cultivation of a number of advanced manufacturing clusters. On the other hand, we should speed up ecological protection and the high-quality development of the Yellow River basin. We will press ahead with the formulation and submission of the development outline on Yellow River basin ecological protection and high-quality development for approval, and we will also accelerate the formation of a system anchored by the guidelines as well as other supplementary planning and policies. This will allow for a number of major projects in ecological and environmental protection to be carried out.

My third point is this: We should strive to narrow the gap between regional development by focusing on four key areas. First, we should promote the development of the western region to form a new pattern. A bi-city Chengdu-Chongqing economic circle will be actively promoted to build and China's inland areas such as Shaanxi province will be opened wider. A number of regions in western areas have been at the forefront of China's reform and opening up endeavor thanks to the rollout of the Belt and Road Initiative, including the operation of China-Europe cargo trains. We need to further narrow the gap there, particularly in the three regions and three prefectures affected by extreme poverty. Second, we should reinvigorate the northeastern region in a comprehensive way. The key lies in continuously improving the business environment and establishing an open and coordinated platform in the face of Northeast Asian countries. Third, we should advance high quality growth in the central part of China. We should organize to implement the package police of Hubei for its economic and social development in accordance with the documents issued by the State Council. Special policies have been rolled out for the province's development for it has been badly affected by the epidemic. Meanwhile, we should make development policies that touch on central areas. Fourth, we should continue to support the eastern areas that are taking the leading role in development, put policies in place regarding the rise of the marine economy and expediting the construction of strategic marine measures.

My fourth point is this: we should bring into full play the leading role of the functional platform. We should establish and improve policies of national-level new zones and induce key areas to perform as industrial relocation platform and build infrastructure projects with investment funds from the central government budget and special development funds. We will move forward with the development of state-level new areas, demonstration zones for industrial relocation. Thank you.

Hong Kong's Bauhinia Magazine:

Mr. Ning, in face of the impact brought by COVID-19 on international economic and trade relations, how should we better play the role of the Belt and Road Initiative in order to promote mutual benefit and win-win results among countries and build a community with a shared future for mankind? Thank you. 

Ning Jizhe:

As you said, the COVID-19 outbreak came unexpectedly and ravaged the world, dealing a severe blow to international economic and trade relations. Thankfully, although economic and trade cooperation along the Belt and Road has also been hit, it was relatively less severe. 

In the first quarter, China's imports and exports with Belt and Road countries registered a positive growth of 3.2%, which is 9.6 percentage points higher than overall trade. This bucked the downward trend, and played a positive role in openness and cooperation. Next, we will follow the principle of extensive consultation, joint contribution and shared benefits. We will promote policy, infrastructure, trade, financial and people-to-people connectivity. We will uphold the philosophy of open, green, and clean cooperation. We will pursue a high-standard, people-centered, and sustainable approach to promote high-quality Belt and Road cooperation. Ultimately, we will build a community with a shared future for mankind. This includes the following aspects: 

First, we will coordinate pandemic prevention and control and Belt and Road construction. We will work on pandemic prevention and control in overseas projects, abide by the laws, regulations and pandemic control rules in those countries, let enterprises play their principal role, and carry out targeted pandemic prevention and control, in order to ensure people's safety and health. We must actively guard against all possible risks, promote work and production resumption in an orderly manner, and help countries along the Belt and Road with their economic stability and recovery work. 

Second, we will promote smooth logistics in the economic and trade cooperation with countries along the Belt and Road. We will support foreign trade companies to resume work and reach their target output, maintain their market and orders, and ensure the stability of the industrial chain and supply chain. This is not only for our own sake, but also to benefit countries that cooperate with us. As of May 10, China-Europe freight train services had registered 3,320 trips. This is a year-on-year increase of 24%, which is also bucking the downward trend. We will enable China-Europe freight trains to better play their role of connecting Europe and Asia. We will consolidate and expand our mutually beneficial economic and trade cooperation with Belt and Road countries, enhance the construction of free trade zone networks, and improve trade and investment liberalization and facilitation. 

Third, we will expand the cooperation fields of the Silk Road of Health and the Digital Silk Road. We will actively participate in global public health governance, provide anti-pandemic assistance to developing countries as much as we can, strengthen medical and health cooperation with Belt and Road countries, promote the construction of the Silk Road of Health, and build a public health community of a shared future for mankind. We will also promote cooperation in big data, the Internet Plus, and smart cities. We will also promote cross-border e-commerce, online exhibitions, online investment promotion campaigns and cloud-based videos, and jointly build the Digital Silk Road. 

Fourth, we plan to strengthen exchanges and cooperation in people-to-people and cultural fields. We will further carry out cooperation in education, science, culture, sports, tourism, archaeology and so on. We will also strengthen exchanges among parliaments, parties, non-government think tanks and media, in order to bring people closer. We will promote soft connectivity such as policies, rules and standards, follow market rules, and match international rules and standards, in order to promote the integration of soft and hard connectivity. This includes promoting cooperation in design, consulting, accounting, legal and other production-oriented services, which are aimed at promoting overall connectivity. 

I took part in the second, third, and fourth Hong Kong Belt and Road Summit. The summit improved each year and attracted more and more participants each time. I observed that most of the participants were small- and medium-sized business owners, freelancers and professionals. They were very interested in it and ready to join in, and they had the strength and capacity in the fields that I mentioned earlier. So, I believe the summit will become better and better. Thank you.  

Hong Kong Economic Herald:

This year marks the finish line for the building of a moderately prosperous society in all respects and achieving the goals laid out in the 13th Five-Year Plan. What are the arrangements of the NDRC in the fight against poverty and how will the remaining poor population be lifted out poverty this year? Thank you. 

Cong Liang:

Thank you for your questions. Mr. Ning Jizhe and Mr. Zhao Chenxin have touched upon this question previously, and I will introduce the following four aspects of the work the NDRC is doing: 

First, we are promoting the completion of poverty alleviation and relocation work. As Mr. Ning Jizhe just said, our construction tasks were roughly finished one year ahead of schedule. But the work that comes after relocation, especially follow-up support, is still under way this year. We have done the following three things. First, we have formulated policies. We worked alongside 12 departments to map out 25 policies and measures for providing post-relocation aid and support. Second, we enhanced supervision. We urged and directed local authorities to fulfill their responsibility, overcome the impact of COVID-19, and expedite the work on the remaining projects as well as the post-relocation support in accordance with different regions and categories. We also carried out supervision over the remaining work at resettlement areas, as well as urging the related provincial-level regions to finish their projects and put them into operation as soon as possible. Third, we coordinated funding. We coordinated and arranged 26.4 billion yuan of general bonds issued by local governments and 4.8 billion yuan of poverty alleviation fund provided by the central government. All of it went to post-relocation support. As of the end of April, decisive progress had been made in the relocation campaign. A total of 9.515 million people from registered poverty-stricken families had been resettled, accounting for 99.4% of the whole. The remaining 0.6% of people will resettle as soon as possible this year. In addition, 17 out of 22 provincial-level regions had completed their resettlement tasks, and in the resettled families with an available labor force, more than 90% of the families had at least one person in employment. 

Second, give play to the role of poverty-relief employment programs in creating more employment opportunities and increasing incomes. Just now, Mr. Zhao also mentioned this issue. We have allocated capital amounting to 5.6 billion yuan in batches for poverty-relief employment programs, especially in extremely poor areas, including Tibet autonomous region, Xinjiang Uygur autonomous region, and parts of Sichuan, Yunnan and Gansu provinces and Hubei province and other areas seriously affected by the COVID-19 pandemic. People living in poverty, especially those who cannot travel to work because of the pandemic, are being widely organized to participate in the programs. The percentage shares of incomes among investment by the central government increased to 15% from 10%. In the past, the lowest share was 10%. These programs are expected to help 300,000 poor people who cannot make it to work because of COVID-19 find jobs in their hometowns and increase their income.

Third, promote poverty alleviation by consumption. We have cooperated with 27 central government departments and units and conducted 30 specific actions to increase the consumption of special products and services in poor areas and relieve the negative impacts of the pandemic. We have coordinated 23 central government departments to utilize the advantages of their own system, industry and sector to directly purchase more than one billion yuan of special agricultural products from Hubei province and help the province sell products of 10 billion yuan worth; these efforts were effective. 

Fourth, coordinated steps will be taken in other poverty alleviation efforts. We will continue to increase support for safe drinking water, education and medical projects in poor rural areas, and we will speed up the construction of roads, power grid and water conservation projects in rural areas. New funds, projects and measures should be weighted toward areas in deep poverty.

In the next phase, the National Development and Reform Commission (NDRC) will fully implement the spirit of General Secretary Xi Jinping's important speech at the symposium on securing a decisive victory in poverty alleviation and Xi's instructions given during his inspection tours in Shaanxi and Shanxi provinces. We will ensure the completion of projects and the follow-up support in order to accomplish targets of relocation during the 13th Five-Year Plan period. Thanks.  

Xinhua:

At the meeting of the Political Bureau of the CPC Central Committee, it was proposed that timely action must be taken to drive reform, and problems in China's development should be solved through reforms. My questions are: What is China's economic reform focused on, and what kind of reforms will the NDRC roll out? Thank you.

Zhao Chenxin:

Thank you for your questions. General Secretary Xi Jinping stressed that the more severe and complex the developmental environment is, the more important it is to deepen reform, improve institutions, improve the governance system, and make good use of institutional strengths to respond to risks and challenges. I think many friends concerned with the reform, such as this journalist, have noticed two important documents on reform issued by the State Council in April and May. One was the guideline on improving the market-based allocation mechanism of production factors, which was issued on April 9. The other one is the guideline to accelerate the improvement of the socialist market economy in the new era that was issued on May 11. These two very important documents were issued at the right moment, which evoked a favorable response. I believe that these two documents illustrate that reforms are under way and are being deepened unswervingly. 

You are concerned about the focus of this year's reform of the economic system and major measures. I think that the focus of reforms has been detailed in the documents. Regarding the measures, I will summarize them in "four focuses" and give a brief introduction here. 

First, the high-standard market system will be promoted and encouraged to build. We will construct a more complete market-based allocation mechanism of production factors. This is a great target. Comprehensive reform pilot projects will be launched, and policies will be set to speed up the cultivation of a data factor market and attract enterprises of different ownerships to take part in building marketplaces for factor trade. This year, we will reform methods of land planning and management, and the provincial-level governments will be given more autonomy over land use. In addition, we will revise the negative list on market access and issue the 2020 version. The list will focus on the service sector, and pilots will be run to relax the restrictions on market access and remove hidden barriers.   

Second, improve the quality and efficiency of the reform of state-owned asset and SOEs. This year, we will formulate guidelines on optimizing the distribution and structuring readjustment of the state-owned economy, and we will push forward 210 mixed-ownership reform pilots. With respect to mixed-ownership enterprises, a governance mechanism and regulatory mechanism that are different from those of common state-owned enterprises should be explored, and we must make efforts to gain experience that can be copied and popularized. We will research and formulate the guidelines of deepening the mixed-ownership reform of SOEs and upgrade the related policies to give better guidance and enable the mixed-ownership reform to better play the role of a breakthrough and feature prominently in the reform of state-owned asset and SOEs. 

Third, we will work to improve the environment for the development of the private sector. First of all, we will carefully implement concrete measures in supporting the development of the private sector in fields such as transportation infrastructure and manufacturing, open up competitive aspects in sectors of power, telecommunications, railways, oil and gas, so as to attract more private capital to participate in project operation and construction in these fields. We will also comprehensively implement business environment regulations and clean up unreasonable discriminatory regulations and practices concerning different types of the enterprises. In addition, we will also work to form a new type of cordial and clean relationship between government and business, and improve the mechanism for entrepreneurs to participate in the formulation of enterprise related policies. We will also make great efforts to solve practical difficulties for private businesses.

Fourth, we will strive to improve the system and mechanism of basic public services. This year, we will promote the introduction of the national standard system for basic public services, through which we can make clear the scope of the basic public services governments at different levels should guarantee, especially making clear the bottom line. This year, the impact brought by the epidemic and the experiences we gained from fighting it, created opportunities for precious thinking. We need to let local governments at all levels know the key point of ensuring basic people's livelihood, and to what extent it should be ensured. We must benchmark the national standard so as to make up for any deficiencies and optimize resource allocation, so as to put the limited capital and resources available into the areas of most concern and most needed by the people.

In addition to the aforementioned four aspects, we will also launch reforms in other areas, including the regulation and control of the price of commodities concerning people's livelihood and green development. In short, to reform is the requirement of General Secretary Xi Jinping and the CPC Central Committee. It represents the shared aspiration of all peoples and is the trend of the times. The NDRC will, together with relevant departments, unswervingly deepen the reform of the economic system, and meet the expectations of the people. Thank you.

Hu Kaihong:

This concludes today's press conference. Thank you, speakers. Thank you all.

Translated and edited by Zhu Bochen, Wang Qian, Wang Yiming, Li Huiru, Wu Jin, Zhang Junmian, Qin Qi, Fan Junmei, Liu Qiang, Zhang Jiaqi, Huang Shan, Gong Yingchun, Zhou Jing, Li Xiao, He Shan, Zhang Tingting, Wang Yanfang, Zhang Lulu, Zhang Rui, Yang Xi, Laura Zheng, Jay Birbeck, David Ball, Geoffrey Murray, Scott Rainen. In case of any dispute over a discrepancy, the Chinese version is deemed to prevail.

Read in Chinese

The State Council Information Office holds a briefing on the annual Report on the Work of the Government on May 22 in Beijing. [Photo by Jiao Fei/China SCIO]

Speakers:

Huang Shouhong, head of the drafting team of the Report on the Work of the Government and director of the State Council Research Office

Sun Guojun, member of the drafting team of the Report on the Work of the Government and member of the Leading Party Members Group of the State Council Research Office

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

May 22, 2020

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this briefing held by the State Council Information Office. The third 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. The public is paying great attention to this report. In order to help people better understand its content, we are very pleased to invite Huang Shouhong, head of the drafting team of the Report on the Work of the Government and director of the State Council Research Office, and Sun Guojun, member of the drafting team of the Report on the Work of the Government and member of the Leading Party Members Group of the State Council Research Office. They will elaborate on the report and take your questions. First, we will give the floor to Mr. Huang for an introduction.

Huang Shouhong:

Good morning, friends from the media!

This year's "two sessions", the annual sessions of the National People's Congress (NPC) and the Chinese People's Political Consultative Conference (CPPCC), are very unusual and draw attention from not only Chinese citizens but also the international community. The Report on the Work of the Government delivered by Premier Li Keqiang follows the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era; adheres to the guiding principles of the 19th National Congress of the Communist Party of China (CPC), the second, third, and fourth plenary sessions of the 19th CPC Central Committee and the Central Economic Work Conference of last year; and abides by a series of major decisions and deployments made by the CPC Central Committee with Comrade Xi Jinping at its core on coordinating the advancement of epidemic prevention and control with economic and social development. The report reviews the government work in 2019 and the situation of epidemic control and prevention as well as the resumption of work and production so far this year. It also lays out this year’s main targets and tasks and macro policies and measures for economic and social development, and the overall plan for the next stage of work. Some of you were on the scene while some watched the delivery of the report via video link. Either way, you all could feel the atmosphere and heard the applause the delivery produced. This shows that the report has been well received by the NPC deputies and CPPCC members. Before coming to the briefing, I read some comments about it on the Internet. I feel that the report responds to public concerns and reflects their expectations. It serves to bind people together, warm people’s heart, boost their confidence, and unite them.

We all know that this COVID-19 outbreak is a public health emergency of international concern, which has changed a lot of things. In terms of the drafting of the report, we have also encountered an unprecedented new situation. Since the end of last year, we have drafted the report following due procedures, in accordance with the decisions and deployments made by the CPC Central Committee with Comrade Xi Jinping at its core and the spirit of the Central Economic Work Conference. After deliberation and approval by the CPC Central Committee and the State Council, the draft was sent to all regions, departments, and units to solicit opinions. We then revised the report based on the opinions received. However, influenced by the COVID-19 outbreak, major changes have occurred both at home and abroad, and the "two sessions" were postponed. According to the CPC Central Committee's decisions and deployments, recently we made major adjustments and amendments to the report. General Secretary Xi Jinping chaired two meetings of the Standing Committee of the Political Bureau of the CPC Central Committee and also presided over a meeting of the Political Bureau of the CPC Central Committee to deliberate the draft report and issued clear requirements and important instructions for the drafting and revision work, which provided a fundamental basis for the drafting work . Premier Li Keqiang took charge of the drafting and revision of the report and other leading officials of the State Council offered specific guidance. Premier Li Keqiang presided over two State Council executive meetings and one plenary meeting of the State Council to deliberate the draft.

In the process of drafting and revising the report, Premier Li Keqiang chaired several special symposiums, reaching out to the grassroots and directly listening to the opinions and suggestions of ordinary citizens. Other leaders of the State Council have also listened to people's opinions and suggestions in various ways and forms. All organs of the CPC Central Committee and the State Council have put forward opinions and suggestions, as have so done all sectors of society including a vast of number of netizens. Many opinions and suggestions have been put forward, especially since the outbreak of the COVID-19 epidemic, concerning the trend of China’s economy, the setting of the targets for economic and social development, and the policy-making at the macro level. From the perspective of the drafting group, we certainly paid great attention to the responses from all sectors of society, especially those from netizens. For example, the online portal of the Chinese government (Gov.cn) has worked with 25 internet media platforms and government websites of all regions and departments, launching the "Share your ideas with China's Premier" internet suggestion-box event for the sixth time. The focus of the suggestions collected slightly changed after the pandemic. The recent focus has lain in five aspects, including employment, medical care, housing, income and consumption, and market entities. Gov.cn selected nearly 1,400 suggestions of a highly representative nature that were submitted to us. We have also collected netizens' opinions via the suggestion column on major portal websites such as Xinhuanet.com and People.com.cn.

In addition, as the leading organ to draft the report, the Research Office of the State Council followed the practice of recent years and held symposiums with the Ministry of Science and Technology and the State Administration of Foreign Experts Affairs to listen to the advice of various foreign experts. With a global view and from the perspective of international comparison, 13 renowned experts from nine countries have put forward some extraordinary opinions and suggestions for the work of Chinese government as well as for report drafting. It took us an extensive amount of time to draft the report this year, and this hasn't happened often since the reform and opening-up over 40 years ago. Correspondingly, we've spent much time to listen to opinions from various aspects, and have received a lot of suggestions from different sectors. Based on these, we constantly revise the report as the situation is changing. The global pandemic situation is changing. The achievement of domestic epidemic prevention and control is constantly expanding. The economic situation both within and outside of China also keeps changing. In order to make better judge of the economic and social development, and to better respond to the concerns of all sectors of society, we've engaged in constantly revisions. We have been revising it almost on a daily basis recently. In the coming days, we will continue our revision efforts based on the opinions of the deputies to the NPC and members of the CPPCC National Committee. That's all for the brief introduction of the drafting and revising of the Report on the Work of the Government.

The report briefly reviewed the work and achievement in 2019 and the first few months of 2020. Last year, the growth of the world economy was the slowest in the decade since the global financial crisis. International economic and trade fractions intensified. China's GDP reached 99.1 trillion yuan, nearly 100 trillion yuan, representing a 6.1% increase over the previous year. Around 13 million new jobs were added. These admirable achievements have not come easily. Originally, the economic situation in the fourth quarter is turning toward a promising side. If without the impact of the COVID-19 pandemic, China's economic prospects in the first half of 2020 were expected to be fairly good. The epidemic certainly changed the situation. After the outbreak, the CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to the situation. General Secretary Xi Jinping has been personally commanding and deploying the deeply moving battle against the epidemic by mobilizing all resources, and blocking the spread of the virus. With the arduous efforts of people across the country and the great price we've paid, the fight to defend Wuhan city and Hubei province, the main battlefields of epidemic, has achieved decisive results. Epidemic prevention and control in China have seen a strategic achievement, and the coordinated development of economy and society has also seen a positive progress. "It is only by overcoming enormous difficulties that China has been able to contain COVID-19 in such a short time…" as stated in the report when considering these achievements. Everyone here has experienced this process, and should deeply understand this sentence. All of these fully demonstrate that the CPC Central Committee with Comrade Xi Jinping at its core has extraordinary capabilities to manage complicated situations, firm determination to solve difficulties and face challenges, and farsighted vision to analyze and judge the situations and to implement work. In the meantime, this also fully shows the resilience, potentials and risk-resistance of China's economy, reflecting China's unique political and institutional advantages.

Based on the analysis of both domestic and international situation, the Report on the Work of the Government presents an overall plan for the next stage of work. My understanding is, in order to comprehend the policies and arrangements for the next stage, we should follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and focus on the targets and tasks for completing the building of a moderately prosperous society in all aspects. We should pay close attention to the following five points:

First, we should make sure that implementing regular COVID-19 control measures is the major premise of all our work. The epidemic is a true wild card in the next stage of our development. We have made major strategic achievements in our response to COVID-19. However, the risk of imported cases always lurks as the pandemic continues to spread across the world. Clusters of infections were reported occasionally in China and it has become more complex in regard of the possible resurgence of epidemic. China has switched the epidemic prevention and control measures from "emergency" to "regular," which will possibly be in place for quite a long time. General Secretary Xi Jinping has repeatedly stressed that we should stay alert against the epidemic, because once it rebounds, and gets out of control, the whole economy and society will again be disrupted. We must stay alert, but we also cannot afford further delaying our economic and social development and putting aside people's livelihood and employment. What shall we do? The CPC Central Committee proposed to improve our regular epidemic prevention and control mechanism to ensure timely detection of infections, rapid response, targeted control, and effective treatment, and ensure no possibility of an epidemic rebound. Under such premise, we should enhance our efforts to promote the comprehensive resumption of work, production, market and business, and smooth the circulation of industry, market, economy and society. All the conclusions, policies and measures regarding economic and social development presented in the work report should be implemented and advanced under the premise of regular epidemic control.

Second, we should prioritize efforts to maintain security in six areas. Facing complex and severe external environment and great downward pressure on domestic economy, the CPC Central Committee and the State Council in 2018 proposed to ensure stability on six fronts - employment, the financial sector, foreign trade, foreign investment, domestic investment, and expectations. To cope with unprecedented difficulties and challenges this year, the CPC Central Committee and the State Council are insisting on maintaining security in six 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, with the core objective being stabilizing economic fundamentals, ensuring the bottom line in regard to people's livelihood and achieving poverty reduction goals. They are positive and progressive targets and tasks set under new circumstances. Some people seem to think those measures are passive, defensive, and negative. Actually, this is not the case. It is a progressive and forward-looking approach when we can run a little bit faster in ordinary situation. However, severely impacted by external factors, it is also a positive signal if we are able to stand fast and not retreat or fall back even slightly, but at least get ready to stride forwards as soon as possible. Facing an unprecedented impact, stabilizing the economic fundamentals means to protect social productivity as well as ensure the foundations for further development. We have nothing else to worry about when this foundation has been properly secured. The basis of economic and social development will be guaranteed if the bottom line of people's livelihood is ensured. This is done out of concern for overall stability and economic growth. You are aware that we have realized a virtuous cycle featuring improved people's livelihood and boosted consumption and economy. Therefore, when we endeavor to ensure people's basic living needs, we are securing the bottom line as well as stabilizing consumption and promoting economic development. Achieving poverty reduction goals marks completing the building of a moderately prosperous society in all aspects. Poverty-stricken areas are the greatest challenge facing us. It is our most important task to eliminate poverty, a mission we must fulfill. That's why this year's policies are concentrating on ensuring stabilities on six fronts and maintaining security in six areas particularly, highlights job security, ensuring basic living needs and operations of market entities.

The third is about our understanding of poverty alleviation as an obligatory task. When defining a moderately prosperous society, the key is to observe the condition of farmers. Poverty alleviation is a symbolic benchmark of our efforts to build a moderately prosperous society in all respects, to which the CPC Central Committee attaches great importance. Since the 18th National Congress of the CPC, General Secretary Xi Jinping has personally commanded and supervised the battle to eliminate poverty. We have made decisive achievements thanks to our unremitting efforts. According to the report, the poverty headcount ratio had fallen to 0.6% at the end of last year. The number of impoverished people in China dropped to 5.51 million from the figure of 98.99 million at the end of 2012. On March 6, General Secretary Xi Jinping attended a symposium on securing a decisive victory in poverty alleviation and delivered an important speech, issuing a mobilization order to clinch a complete victory in the fight against poverty. More than 10 million people have been lifted out of poverty each year in recent years, and only over five million people now need to achieve their own transformation. However, the COVID-19 pandemic has had a negative impact on the poverty alleviation efforts. For example, the workforce is facing difficulties in going back to work, and sales of agricultural products in some impoverished regions also encounter challenges. Therefore, people face a rising risk of falling into or returning to a state of poverty. In order to ensure final victory, according to the deployment of the CPC Central Committee, major targeted and forceful measures have been put forward in the report. China will attain its poverty alleviation target this year, which means achieving the poverty reduction goal set in the United Nations 2030 Agenda for Sustainable Development 10 years ahead of schedule. This is China's great contribution to the cause of global poverty reduction.

The fourth aspect relates to understanding of how to expand domestic demand as a strategic focus. China is a country with 1.4 billion people and a per capita GDP of more than $10,000. Its consumer spending has been optimizing and upgrading, and its consumer market is the world's largest, with the greatest potential. Moreover, China has gained momentum in its development in terms of new type industrialization, informatization, urbanization and agricultural modernization, and the demand for effective investment is enormous. The two points will unleash the huge potential of domestic demand. This is the biggest advantage for a major economy. As long as we unleash such potential, a constant and powerful driving force for economic growth will be created. Therefore, the report proposed implementing the strategy of expanding domestic demand, in view of the need to cope with the impact of the pandemic, the need to maintain long-term, sustained and sound economic development, and the importance of meeting people's increasing need for a better life. How to implement the strategy? The report has laid out a roadmap, which focuses on deepening supply-side structural reform, improving people's wellbeing, and boosting consumption and investment in a more coordinated, mutually-reinforcing way. Major measures have also been put forward. Economic development in different regions in China is unbalanced, representing a huge potential for economic growth and many growth drivers to expand domestic demand.

You must have paid close attention to the construction of "new infrastructure, new urbanization initiatives and major projects" put forward in the report. It refers to development of new infrastructure projects, new urbanization initiatives and traditionally defined key projects, such as railways, highways, airports and water conservancy projects. There is a broad consensus that we should expand effective investment, but here are various ideas on what should be the priority areas. The report, aiming to promote the high-quality development of the economy and meet people's needs, proposed taking the construction of "new infrastructure, new urbanization initiatives and major projects" as investment priorities. The CPC Central Committee and the State Council made this decision after much study and consideration. Moreover, it was also determined after listening to the views of all sectors of society. Such priorities will not only boost consumption and benefit the people, but also facilitate structural adjustments and enhance the sustainability of growth. It will serve multiple purposes. The construction of new infrastructure serves as a driver to promote high-quality development and meet people's demand for consumption upgrading. Counties are priorities in development of new urbanization. In order to meet the growing demand of rural residents to work and settle in county seats, it is necessary to support them to improve services and carrying capacity. It is also necessary to begin the renovation of old urban residential communities. In regard to the construction of railways, highways, airports, as well as water conservancy projects and energy projects, many are closely related to people's quality of life. Therefore, the construction of "new infrastructure, new urbanization initiatives and major projects" is a major measure which not only prioritizes people's wellbeing, but helps support expansion of domestic demand.  

Fifth, grasp the greater logic of reform and opening up. Previously, some people worried that in order to cope with the impact of the epidemic, we might take the old path of initiating rash and ineffective projects while adopting extensive growth, or take measures to maintain short-term growth but which would harm long-term development. Because some measures are conducive to stabilizing growth in the short term, but if they are handled badly, they will leave residual effects. To cope with unprecedented challenges and achieve our development goals and tasks, there are many specific policies and measures we can take, but what should be the basis? According to the decisions of the CPC Central Committee, the report clearly states that we need to "pursue reform and opening up as a means to stabilize employment, ensure people's wellbeing, stimulate consumption, energize the market, and achieve stable growth. We need to blaze a new path that enables us to respond effectively to shocks and sustain a positive growth cycle." Relying on the approach of reform and opening up, we can stimulate creativity in all aspects of society, stabilize employment and protect people's livelihood, then there will naturally be consumption. And with consumption, the market will be stimulated, effective investment will be driven, and growth will be stabilized. The reform and opening up policy has been an amazing weapon for China to make tremendous achievements over the past 40 years. No matter what difficulties and challenges it has encountered during this time, this effective weapon has been tried and has succeeded again and again, with no exception. The new measures proposed in the report to promote socioeconomic development include ensuring stability on the six fronts and security in the six areas. (The six fronts refer to employment, the financial sector, foreign trade, foreign investment, domestic investment, and expectations. The six areas refer to job security, basic living needs, operations of market entities, food and energy security, industrial and supply chains, and the normal functioning of primary-level governments.) It can be said that they follow the "scriptures" of reform and opening up, use the "approaches" of reform and opening up, and "walk the path" of reform and opening up. This allows the market to play a decisive role in the allocation of resources and the government to better play its role.

Next, my colleague Mr. Sun Guojun and I are willing to answer any questions you may have on the drafting of the report.

Hu Kaihong:

Thank you, Mr. Huang, for your introduction and interpretation. Let's start the questions.

CNR:

I noticed that this year's Report on the Work of the Government did not propose specific GDP targets. Why is that? In addition, how should the current economic situation in China be seen? Thank you.

Huang Shouhong:

This is one of the most prominent issues that society is concerned about. Please allow my colleague Mr. Sun Guojun to answer the question.

Sun Guojun:

Your question is uppermost in everyone's minds. Before I came here, I watched CCTV's "livestream room" program and its "ministers' passage" broadcast. The first question raised by a reporter was regarding this year's report not putting forward a quantitative economic growth target, as the annual Report on the Work of the Government usually proposes an expected target for GDP growth rate that year. Of course, there have been occasions in the past when one was not mentioned.

Why didn't we mention economic growth this year? In fact, the biggest factor is uncertainty. This uncertainty comes mainly in two aspects: one reason is the uncertainty in the pandemic’s development trend. There are now nearly five million confirmed cases worldwide, and large increases of almost 100,000 new cases every day. No one can predict the next development trend of the pandemic. The other reason is the uncertainty in the world economy. The pandemic is currently the biggest factor affecting global economic activities. If we cannot accurately estimate the progress of the global pandemic, we cannot accordingly estimate how the pandemic control measures will be adjusted for each country. In the first quarter, the major global economies have experienced relatively large negative growth. Much analysis concludes that the world economy has experienced a severe recession, and even suggest that it may be no less severe than the Great Depression in the 1930s. The economies of all countries are in great uncertainty.

Not setting a specific target for economic growth this year does not mean we are ignoring economic growth or letting economic growth decline. There is a very important sentence in the report, which reads "ensuring stable economic performance is of crucial significance."

At present, there are two aspects that need to be underpinned by economic growth. First, this year, we must give priority to stabilizing employment and ensuring living standards, win the battle against poverty, all of which need to be underpinned by economic growth. Based on the empirical data of previous years, one percentage point of growth corresponds to about two million new jobs. From the perspective of poverty alleviation, there are nearly 30 million members of the labor force who are impoverished and working away from their hometown. Labor income is an important source of income for many rural residents and an important path to poverty alleviation. If there are difficulties attaining employment, people will also have difficulties receiving income, leading to a whole range of problems related to consumption; thus, growth is critical. Second, economic downturns often lead to the emergence of certain risks. For example, in finance and other fields, new potential problems and risks may emerge during economic downturns. Take financial resources at a basic level as another example: If there is no growth in the economy, there will then be difficulties in financial resources, leading to a series of chain reactions. Therefore, ensuring stable economic performance is of crucial significance. 

We have paid a great price for our efforts to prevent and control the COVID-19 pandemic. In the first quarter, the economy posted a negative growth of 6.8%. But considering the health and safety of our people, this is a price that we must pay. It is a price that is worth paying. With the outbreak of the pandemic effectively under control in China and efforts to resume work and production accelerating, the whole Chinese economy is gradually beginning to recover. In April, the industrial growth was at 3.9%, and the growth in electricity consumption, electricity generation and rail freight volume turned from negative to positive, which is a positive sign. Although some indicators, such as total retail sales of consumer goods and investment, were still declining, the rate of decline is slowing down. All this shows that the policies we implemented previously, such as cutting taxes and fees, supporting finance and providing assistance to enterprises to stabilize employment, have paid off.

The report sets out a number of policies to be implemented in the next phase of the year. For example, the fiscal policy focuses on spending money to stabilize employment and ensure people's wellbeing; the financial policy focuses on protecting market entities; the employment and social security policies focus on unfailingly meeting the basic living needs of our people. I believe that with the implementation of these policies, the economy will gradually stabilize and recover. The base of the economy will not have any problems this year, and the people's wellbeing won't have any problems either. Thank you.

Nihon Keizai Shimbun:

You just mentioned that 1% growth will create two million new jobs. In this year's report on the Work of the Government, the target was to create more than nine million new jobs, thus the actual growth target should be around 4.5%. Is this a reasonable understanding? My second question touches on the one trillion yuan of government bonds that are going to be issued. The forecast of the financial market is at about three trillion yuan. How is the actual issuance amount estimated? What are your considerations behind this? Thank you.

Sun Guojun:

You asked two questions. First, I mentioned that one percentage point of GDP growth corresponds to about two million new jobs. This is based on empirical data. In different economic growth ranges, the corresponding number of new employment is different. For example, when GDP grows at around 6%, one percentage point of growth corresponds to about two million new jobs; but when the range is widened, there is no absolute linear relation. When economic growth is relatively low, the policies focus on stabilizing employment. At the moment, the corresponding relationship between one percentage point of growth and new employment differs from what it would be during relatively high economic growth.

This year's employment is under great pressure. The credit policy and policies including unemployment insurance refunds are all related to stabilizing enterprise employment rates and reducing the number of layoffs, so as to ensure the bottom line of employment. This year, we have made proper adjustments to the employment target, so creating over nine million new urban jobs is realistic. More than nine million new jobs and a surveyed urban unemployment rate of around 6% is consistent with the current economic situation.

The second issue is the issuance of 1 trillion yuan of special anti-pandemic bonds, with some expectations in the market being a bit higher. Fiscal policies in a broader sense cover four major budgets, including general budgets and budgets for government funds, all of which will be taken into consideration. The point of issuing the government bonds for COVID-19 control is to "fight the epidemic". The issuance of special bonds for combating the epidemic is a special means taken during a special time. Part of the money will be used directly to cover local spending for combating the epidemic, including expenditures to bolster weak spots. Another part of it will be directly transferred by the central government to local governments. 

In the case of COVID-19 government bonds, I believe the scale is appropriate. Because this year, a total of 3.75 trillion yuan of special local government bonds will be issued, an increase of 1.6 trillion yuan over last year. The use of these bonds should be coordinated. There will also be investment in the central government budget. We cannot simply look at one item to determine the strength of fiscal policy. Instead, we should take the fiscal policies presented in this year's Report on the Work of the Government into thorough consideration. This includes the coordination of monetary policies and the implementation of fiscal policies. For example, the prefecture-level and county-level governments are directly responsible for making efforts to stabilize employment and ensure people's wellbeing. However they currently face direct pressure, so a special transfer payment mechanism will be set up to ensure that the funds will not be withheld by provincial-level governments but go straight to prefecture and county-level authorities. This is a mechanism we have not been seen before. 

Huang Shouhong:

I'd like to add something. Mr. Sun Guojun said that the use of the COVID-19 bonds and fiscal deficit this year would be a reform and innovation that will go straight to the grassroots and directly benefit enterprises and people. As for the relation between employment and growth rate, Mr. Sun just said that under normal conditions, economic growth and employment had a corresponding relationship, but in an unusual time, this corresponding relationship will change. For example, in the first quarter, China's GDP lowered by 6.8%, but we added 2.3 million new jobs. The relationship between the economic growth rate and employment is very complicated and the two factors cannot maintain a corresponding relationship all the time. Employment lags behind and the fluctuations of the two factors do not correspond either. We should see that economic laws are different when under special conditions than during normal conditions. That's what I have to add.

CCTV:

Recently there have been talks across the world regarding the end of globalization, decoupling from China and evacuating from China. I'd like to get your opinion on these remarks. Another question is what China will do to stabilize the overall performance of foreign investment and foreign trade. Thank you. 

Sun Guojun:

Whenever problems or frictions emerge in the global economy, economic arguments such as decoupling from China come to the fore. We should look at the big picture when discussing globalization. Globalization is a general trend. It is hard to imagine what the world would be like without the globalization of investment, trade and movement of people. In the long term, globalization is certain to bring benefits to each nation and all people. That is why the Chinese government unswervingly supports globalization. Small problems are inevitable in the process, but these will not halt the general trend. 

There have been reports about outflows of foreign capital. Some foreign investments have even been moving out. As the economy develops, China's overall development has been improving and a country's comparative advantages differ in different stages of development. There are outflows of foreign capital, but there are also inflows of foreign capital. In the first quarter, our country attracted foreign investment contracted, but in April, we saw sound growth in foreign investment. We also saw that, many surveys, including the ones by some foreign chambers of commerce, showed that more than 70% of multinational enterprises are still bullish about the Chinese market and decide to make investments in the country. Enterprises see China's market as a long-term strategic investment. I think it requires strategic foresight to see this. We should base decisions on strategy and not be subject to the influence of petty remarks. 

I think China has two advantages in this respect. After several decades of reform and opening up, it is fair to say that China has developed the only most complete industrial support system in the world. China is the only country that boasts all the 41 sections, 191 divisions and over 500 groups in the international standard of industrial classifications. It is the biggest trading partner of over 120 countries and its economic growth accounts for 30% of the world's total every year. So, it has a very big market in terms of the supply side. On the demand side, the domestic market is also growing. Either from the supply or demand side, anyone can be optimistic.

This year's Report on the Work of the Government attaches much importance to opening up. First, it makes clear that the Chinese government remains committed to further opening up despite the changing global economy and complex external environment.

Second, it also seeks to expand both exports and imports. On one hand, we need to promote market diversification. For example, our exports to Belt and Road countries now account for 30% of our total. On the other hand, we need to involve more market entities in import and export business. Supporting policies in finance and insurance will benefit more small and medium-sized companies in the foreign trade sector. More support will be channeled to new foreign trade businesses like cross-border e-commerce and new trials of trade in services.

Third, the Report on the Work of the Government also supports investment. This year, the negative list for foreign investment will be significantly shortened, and a negative list will also be announced for cross-border trade in services. Greater autonomy in reform and opening up will also be granted to pilot free trade zones. Both the manufacturing and service sectors will embrace further opening up.

Fourth, China is already seeing an improved business environment, and the Report on the Work of the Government again highlights the need to create a market-oriented, law-based, and internationalized business environment. Also, the Report on the Work of the Government stipulates the need to build a fair business environment in line with the international community. This is important as fair competition meets the demands of both foreign and domestic businesses. We will conduct impartial regulation to ensure fair competition.

Thank you.

Huang Shouhong:

The objective law and historical trend are independent of people's wishes. People's opinions may differ, but facts speak louder than words. Business leaders choose where and how to make investments depending on their own considerations. In the past two years, China has introduced a large proportion of foreign investment at a fast pace in the international community. It means that foreign business leaders are optimistic of the Chinese market.

As Mr. Sun Guojun said, China will further open its market despite great difficulties this year. We did not slow down or cut back opening up, but instead decided to adopt major policy measures to open our door wider to foreign businesses and foreign investment. For example, we will shorten the negative list for foreign investment, further open up service and manufacturing industries, and establish new pilot free trade zones. The idea of reform and opening up is run through the whole work report.

CNBC:

You said you have collected considerable local feedback in preparation for this report. What is the local attitude toward employment and collaborations between SMEs and foreign businesses? What is their plan to boost employment? Thank you.

Huang Shouhong:

One of pressing problems arising in China's current economic development is employment and people's wellbeing. Impacted by the pandemic, some industries, especially in the service sector, and certain enterprises, especially micro-, small and medium-sized businesses, are facing great difficulties. Some companies have laid off employees or reduced pay rates. Why does the report speak of maintaining security in six areas and placing employment at the top of the list under such circumstances? Because employment provides our people a steady livelihood, and it is the most fundamental factor underpinning economic development. What do we rely on to maintain security in employment? The answer is to protect enterprises and market entities, especially micro-, small and medium-sized businesses. These are major channels for people to get jobs, and more than 80% of employment depends on them.

In response to the current difficulties facing enterprises, especially those micro-, small and medium businesses, the report set out a series of measures aimed at maintaining employment security. We have cut taxes and fees for enterprises on a large scale, especially for the vulnerable ones I have mentioned. We cut taxes and fees by 2.36 trillion yuan last year, and we expect that these measures will see additional savings of more than 2.5 trillion yuan for enterprises throughout this year. In addition, there are some policies to reduce enterprise operating costs. For example, the policy of reducing electricity prices will be extended to the end of the year, and the rates for internet access services will be cut by 15% on average. A hot issue in the reports of the recent two years has been the continuous decrease of the rates. Everyone has benefited and happily enjoyed the increased convenience.

The report also specified a series of measures in the financial sector to alleviate the current difficulties of small and micro-enterprises and employment difficulties. In macro policies in particular, it specified development of new monetary policy instruments that can directly bring benefits to enterprises. Stabilizing employment is the most important task for China this year, which will ensure the wellbeing of the people. It is the most important task and where the greatest achievement lies. The reason why we have not set a specific target for economic growth is largely that we aim to focus everyone's enthusiasm, attention and energy on ensuring employment, ensuring the wellbeing of the people, and protecting market entities. All our policies must directly work on the six areas, especially job security, basic living needs, and operations of market entities. We have many measures to maintain employment security.

However, we all know that the unemployment rate will definitely rise this year. Unemployment is a global problem, and the unemployment rates in countries around the world are much higher than usual. For China, although we are making our best efforts and adopting all possible measures, the unemployment rate may still increase slightly, and there will be more people out of work. What should we do in this situation? We have measures not only in expanding employment, but also in extending the coverage of unemployment insurance.

According to the report, the coverage of unemployment insurance will be extended to ensure that all those underwriting the insurance are provided for, and there are some new measures being introduced this year. For example, it was stipulated in the past that people who were in the unemployment insurance scheme for less than a year were not qualified to claim benefits, but they will be covered this year. Another example is that rural migrant workers will be covered in the locality where they are living, and that subsistence allowances will be made promptly available to eligible urban unemployed people and migrant workers who have returned home.

Some people are concerned about our ability to achieve this. Please rest assured. We now have a surplus of over 460 billion yuan in the unemployment insurance fund, and over two trillion yuan of strategic reserves in the social security fund. We will also promote provincial-level coordination of unemployment insurance this year. Through such a series of measures, we have the ability and the means to address the unemployment trend. In the past two years, we have been transferring a portion of state capital to top up social security funds and increasing the centrally-regulated share of basic aged-care pension funds. This year it will be increased to 4%. The people's quality of life will be ensured and improved. In the special and difficult period of this year, governments should take the lead in tightening their belt. As the economic situation improves, employment, especially the operations of small and micro enterprises, will certainly improve accordingly. Thank you.

Southern Metropolis Daily:

According to the Report on the Work of the Government today, the strategy of expanding domestic demand will be steadfastly pursued, but now, consumer spending and investment are declining. How can domestic demand be effectively expanded? How will the relationship between expanding domestic demand, and ensuring and improving the people's quality of life be handled? Thank you.

Huang Shouhong:

Some aspects of this issue has already been mentioned just now. Let's invite Mr. Sun to give a brief introduction.

Sun Guojun:

Let me first add something on the employment. Searching through an electronic version of the report before coming here, I found that the most frequently used word was "employment". This might be the first time in history that the word appeared 39 times.

Regarding the question just now, expanding domestic demand is what China has been doing to develop its economy for a long time. The strategy of expanding domestic demand has also been put forward before. The whole second section of the report in 2000, for example, was about this topic. That was during the ninth Five-Year Plan period. The strategy was put forward again in 2011 during the 12th Five-year Plan period. In fact, we have been insisting on expanding domestic demand, because it is a unique advantage of a populous country, and can provide stable support for economic growth.

Consumption now contributes to more than 60 percent of economic growth. This year, we put forward the strategy to vigorously boost domestic demand. In terms of understanding this strategy, this is not a case of expanding domestic demand merely because there is insufficient demand. Mr. Huang also discussed this issue when he made his introductory remarks earlier. From what I understand, there are a few points as follows:

First, expanding domestic demand must be combined with supply-side structural reform. The supply-side structural reform can both meet the needs of the upgrade in demand and create demand. After China's per capita GDP exceeded $10,000, many residents' demand for mid-to-high-end products increased. The production and supply also need to keep pace. The expansion of domestic demand required the entire industry’s supply system to upgrade at the same time, pushing the economy to realize a high-level of dynamic balance.

Second, we need to increase domestic demand to improve people's living standards. It would be meaningless to expand domestic demand just for the sake of expanding domestic demand. We developed to improve people's living standards, and the ultimate goal of expanding domestic demand is also centered around improving people's living standards. In essence, this is a demonstration of a people-centered approach. We should work to expand domestic demand and improve people's living standards.

Third, in terms of combing consumption and investment, we should make investments to expand domestic demand. For example, new investments could be made on new infrastructure, new urbanization initiatives and major projects.

Fourth, boosting domestic demand and expanding external demand should advance in a parallel fashion. Some people mistakenly think that there is no need for external demand if there is domestic demand, but this is actually not the case. The total amount of China's imports and exports accounts for 30 percent of GDP. We must promote the domestic market along with the external market. We expand domestic demand to promote our openness to the outside market. The ultimate goal of expanding domestic demand is not only bringing good opportunities to domestic enterprises, as it will also present opportunities to companies across the world. Expanding domestic demand in China holds great significance. Thanks.

China News Service:

I'd like to hear about the stories behind this year's Report on the Work of the Government. In particular, is there anything different in the drafting process compared with before? Thanks. 

Huang Shouhong:

Year after year, the flowers are always alike, but people are not the same. Such is the case with this year's report. The drafting of the Report on the Work of the Government is a hard process, especially for this year.

I just provided a brief introduction to this matter earlier. Due to the great changes that happened this year, the drafting of this year's report took quite a long time, which has been rare since the reform and opening-up began. Acting in line with the decisions and plans of the CPC Central Committee, the draft we see today is quite different in terms of form and content when compared to the report we drafted before the Spring Festival. Some of these parts in the report have been completely changed. In terms of content, you may notice that the word count of this year's report is about 10,400 Chinese characters. It is roughly half the length of the reports issued at the annual sessions in previous years when the word count was around 19,500 Chinese characters. Reports in previous years set the work agenda for the whole year, but this year's work agenda is just for the immediate seven months. As the situation has changed, revisions to the Report on the Work of the Government have increased and many parts of the report have been redrafted.

Take a look at the content of this year's Report on the Work of the Government. In the past, our reports offered an introduction to the major work carried out in the previous year in addition to the progress we made in that year. However, this part was not included in this year's report. Another example is that in previous years, reports included regular work arrangements and projects that need to be continually pushed forward. But this year we lack the length and capacity to provide such content, so we didn't deliberate on these parts. You may notice that this year the part on reviewing work mainly talks about landmark achievements from the previous year, pandemic prevention and control and resumption of work and production during this year. This information is provided in a brief introduction. About the part on reviewing the work: The word count of this part was usually about 4,000 Chinese characters in past reports, which were about 19,500 Chinese characters long in total. But this year, the word count is much lower than it was in previous years. Consider the section on the work agenda. In recent years, we usually used three parts to introduce it; namely, there was a part on reviewing work from the previous year, a part presenting general thoughts and an introduction of major work from the year at hand. This year, considering the present state of affairs, we used a list to introduce the work agenda in an attempt to keep the report concise and highlight the next steps of our work. There are many changes in the report, including changes to the content, form, length and so on.

Some explanation needs to be provided here. We still have many work projects that are in progress, such as work that has been pushed forward in the medical and healthcare sector in recent years. This includes the construction of regional medical centers, reform of public hospitals and regulation of health insurance. Given the limited length of the report, we didn't include such matters in this year's report. This year's report focused on new approaches and new measures for coping with the changing situations. The parts we didn't mention in the report still matter and still require continuous effort from us. It should be made clear that just because certain projects were not included in the report does not mean they will not be carried out. Given this year's situation, the report must focus on the major projects and issues that require urgent concern. This reflects the expectations from all sides of society. Similar requirements were put forward in the process of soliciting public opinions.

For a document such as the Report on the Work of the Government, the shorter the version is, the more difficult it is to draft, because we need to convey massive amounts of information and respond to requirements raised by all parties. According to the procedure, after the Report on the Work of the Government is approved at the annual session of the National People's Congress (NPC), all the targets and tasks set by it will be subdivided into more specific ones. Meanwhile, more policies and measures that weren't made into the original version will also be included. Currently, the State Council has been making plans. I trust that you will witness a series of specific policies issued by the CPC Central Committee and the State Council, which stay on the course charted by the Report on the Work of the Government.

It should be noted that all policies proposed in the Report on the Work of the Government are based on the analysis and judgment on the current situation regarding the spread of the pandemic globally, domestic epidemic prevention and control, and the momentum of economic development. If unexpected changes occur, relative policies "may be adjusted as called for," as mentioned in the Report on the Work of the Government. When we adopt a policy, we should both look ahead into the future and back into the past, taking into account both its effectiveness to address the current significant challenges and its sustainability. Just as a military campaign has to be carefully planned out, we also have a host of plans and measures at our disposal in response to possible crises. We have not fired all our bullets in one battle. There are ample room for future policy options. 

Hu Kaihong:

We will invite a reporter from the foreign press to take the final question. 

Reuters:

If there is no national economic growth target set for this year, how will local governments set their targets for local economic growth or fiscal expenditure? Thank you.

Huang Shouhong:

It seems that everyone is concerned about China's economic growth rate. Mr. Sun Guojun has just explained the situation. Normally, the economic growth rate serves as a comprehensive and fundamental indicator based on which arrangements will be made in many aspects. Therefore, it plays a vital role in guiding our efforts moving forward. However, due to the uncertainties this year, all parties have paid great attention to the economic situation before the session. Some suggested a specific target for economic growth should be set, with heated debates about the specific figure. There was also argument suggesting that no specific target should be set due to the current situation. As the question put it, without a specific national target for economic growth, local governments may lack references and basis in their work. Thus, those who advocate setting a growth target also make sense. As we all know, China's economy has been transitioning from a phase of rapid growth to a stage of high-quality development. In this regard, we should treat the economic growth rate in an objective manner and shift away from the GDP-focused growth model. On the other hand, economic growth is important. Facing the current economic decline, we must fulfill our duties and prevent the economy from falling out of control. After all, our efforts to ensure employment and living standards must be underpinned by economic growth.

What should local governments and departments do without a specific GDP growth target as a quantitative indicator? The answer is to continue the work which needs to be done and focus on strengthening efforts to ensure stability on six fronts and maintain security in six areas. Not setting a specific target for economic growth will help ease the burden of local governments for solely pursuing high speed growth. In line with the plans of the CPC Central Committee and the State Council, local governments should concentrate on ensuring job security, basic living needs, and operations of market entities.

The growth rates and GDP figures are final results, rather than the direction of our development. We will not lose direction just because of a lack of growth target. Our direction is clear: In accordance with the decisions and plans of the CPC Central Committee with Comrade Xi Jinping at its core, we will apply the new development philosophy, pursue supply-side structural reform, and promote high-quality development. At present, our focus is to maintain security in the six areas. After the "Two Sessions," through serious discussions and deep speculation, we will share a higher degree of consensus, further clarify the direction of future work, and take actions in all aspects more consciously. Therefore, we will not lose direction without setting a GDP growth target. Thank you.

Hu Kaihong:

Today's press briefing is hereby concluded. Thank you to Mr. Huang and Mr. Sun. Thank you all.

.

Read in Chinese

Speaker:

Liu Yongfu, director of the State Council Leading Group Office of Poverty Alleviation and Development

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

May 18, 2020

Hu Kaihong:

Ladies and gentlemen, good afternoon. Welcome to the press conference held by the State Council Information Office. In 2020, China will finish building a moderately prosperous society in all respects and meet the targets of the 13th Five-Year Plan. This is also the year for the completion of China's poverty alleviation tasks. Today, we have invited Mr. Liu Yongfu, director of the State Council Leading Group Office of Poverty Alleviation and Development. He will brief you on how we are securing the timely realization of China's poverty alleviation goals. He will also take your questions. Now, I give the floor to Mr. Liu.

Liu Yongfu:

Ladies and gentlemen, friends from the media, good afternoon. Welcome to today's press conference. I would like to thank all of you for your long-term concern and support for China's poverty relief work.

This year, China will finish building a moderately prosperous society in all respects and meet the targets of the 13th Five-Year Plan. This is also the year for the completion of China's efforts in poverty alleviation. The Central Economic Work Conference held at the end of last year set out an overall plan for this year's work. The sudden outbreak of COVID-19 has had a major impact on China's economic and social development, and posed new difficulties and challenges for poverty alleviation. The outbreak made it hard for poor laborers to go outside of their hometowns to seek jobs and for village-based officials to promote poverty alleviation. It impaired the business production and operation of impoverished households, and delayed the commencement of projects focused on poverty alleviation as well as the work and production resumption of such key businesses and workshops. At a symposium on March 6 dedicated to securing a decisive victory in poverty alleviation, General Secretary Xi Jinping stressed that lifting all rural residents living below the current poverty line out of poverty by 2020 is a solemn promise made by the CPC Central Committee, and it must be fulfilled on time. The CPC Central Committee has coordinated pandemic prevention and control with economic and social development, making plans and policies to eliminate poverty - a critical task that must be completed this year. Per important instructions given by General Secretary Xi Jinping and plans made by the CPC Central Committee and the State Council, all regions and government departments at all levels, especially those responsible for poverty alleviation, have risen to challenges and worked tirelessly to promote poverty alleviation.

With concerted efforts on all sides, positive progress has been achieved in poverty alleviation despite the impact of COVID-19. As of April 30, all officials assigned to work in poverty-stricken villages had reported for duty. Under the supervision of relevant authorities, a time limit had been set to promote poverty relief work in an orderly manner. The number of impoverished people going outside of their hometowns to seek jobs had reached 95.4% of last year's total. In central and western regions, 3.43 million poor laborers had taken rural public welfare posts. Additionally, 97.5% of leading companies and 97% of workshops dedicated to poverty relief had resumed work, and 82% of poverty alleviation projects had started construction. Sales of products contributing to poverty alleviation had reached 32.3 billion yuan. Funds and human resources allocated for coordinating poverty reduction efforts between eastern and western regions had been put in place, with both figures surpassing target goals. On the whole, the pandemic will not change the general course of poverty elimination, with its impact gradually being overcome. The goals and tasks involved in defeating poverty will remain unchanged, and we will never leave any loose ends, no matter the impact of the pandemic. The current poverty alleviation standard will remain unchanged and without any drop or increase. The timetable for eliminating poverty will also remain unchanged.

Next, we will take the following measures:

First, we will set a time limit on poverty relief work in designated areas and intensify supervision there. We will continue to oversee the poverty relief work in 52 poor counties and 1,113 villages where there are large impoverished populations and it is difficult to shake off poverty. We will urge the seven provincial-level regions that are involved to act on implementation plans, and we will encourage all counties and villages to implement their specific plans. We will focus on ensuring access to compulsory education, basic medical services, safe housing and drinking water for the poor, as well as providing follow-up assistance for residents who have been relocated from inhospitable areas. We will mobilize private enterprises and social organizations to aid poverty relief in designated villages. All of these efforts aim to ensure the timely achievement of all remaining poverty alleviation goals.

Second, we will strengthen poverty alleviation through employment. The number of migrant laborers in poverty in the country this year will exceed 28 million. The total number of migrant laborers in poverty from the central and western regions absorbed by the eastern regions this year will be on par with last year. The total number of poor migrant laborers from the central and western regions this year will be not less than last year. For enterprises to resume work, production and project constructions, the first priority will be arranging for laborers in poverty to work. And enterprises must continue to implement effective point-to-point connections, especially by generating employment for the laborers from the counties listed as impoverished. We will also strive to stabilize available jobs for poor migrant laborers who have gone out of town to work, and we will facilitate work for poor laborers who are willing to travel to work. We will support leading poverty alleviation enterprises and poverty alleviation workshops in the resumption of work and production, make good use of poverty alleviation public welfare posts, mobilize and organize the poor laborers, marginalized individuals, etc., to participate in the construction of projects that offer jobs as relief and, lastly, we will promote employment locally and in nearby regions.

Third, we will strengthen poverty alleviation by consumption. Poverty alleviation by consumption is an important measure to overcome the impact of the pandemic and boost the development of poverty alleviation industries, which should be combined with the "vegetable basket (non-staple food supply)" and "rice bag (grain supply)" programs in the eastern region and cities. The central and western regions should do their best in the production and identification of poverty alleviation products, while eastern regions should increase the sales of such products and solve the problem of poverty alleviation product sales through various methods, including purchases made by budget units, the establishment of a trading market and social participation in sales.

Fourth, we will bolster assessment and aids. We will enhance the assessment of households that are unstable during progress toward poverty alleviation - along with those that are vulnerable to or on the brink of poverty and those whose income has sharply decreased or whose expenditure has suddenly increased due to the pandemic or other reasons - and enact targeted assistance measures for them in advance. We will support the population segments that are on the brink of poverty but have the ability to work via various poverty alleviation policies, such as small-sum poverty alleviation loans with interest subsidies, skill training and poverty alleviation public welfare working posts. For the impoverished people who are unable to work, we will reinforce comprehensive supporting measures, such as minimum living support, medical insurance, and old-age insurance. 

We believe that with the strong leadership of General Secretary Xi Jinping and the CPC Central Committee, together with the joint efforts of the whole Party, country and all of society, and with the solid foundation laid by previous poverty alleviation efforts over the years, we have the confidence, conditions and abilities to win the battle against poverty on schedule!

Next, I am happy to answer your questions.

Hu Kaihong:

Thank you, Mr. Liu. Please ask your questions. Before you do, let us know the news organization you represent.

CCTV:

We know that the central government has set a time limit to promote poverty relief work in the remaining 52 counties and 1,113 villages this year. The State Council Leading Group Office of Poverty Alleviation and Development has also deployed and arranged this work in 2020. May I ask, Mr. Liu, what is the current progress and actual result of speeding up efforts in lifting poor counties and villages out of poverty? Thank you.

Liu Yongfu:

Thank you. There were 832 poverty-stricken counties in our country. As of April 15, 780 counties have announced that they have been lifted out of poverty. Fifteen out of 22 provinces in the middle and western parts of China have no more poverty-stricken counties, while there are 52 poor counties left in the remaining seven provinces. At the same time, we had 128,000 impoverished villages. At the end of last year, there were 2,707 poor villages. Among these 2,707 impoverished villages, there were 1,113 villages each with more than 1,000 poor people and a poverty incidence rate of more than 10%. A time limit had been set to promote poverty relief work in the 52 counties and 1,113 villages. The plan to urge these efforts onward was issued by the central government at the beginning of the Chinese lunar new year, and we printed and distributed it on the third day of the lunar new year. So far, seven provinces have formulated implementation plans. All counties and villages have also formulated operational plans that detail aspects from what the problems are that must be solved to how to solve them, when to finish them and who will do it - a series of measures that are very practical and specific. In addition, the central and provincial governments have increased investment in these listed counties, and they have invested 30.8 billion yuan in these 52 impoverished counties. Each province has also given preferential poverty relief funding to the more than 1,000 villages.

There has also been an increase in the force of help and support, as we can see that there are fewer and fewer poverty-stricken counties and fewer and fewer impoverished villages. Some counties that have been removed from the poverty list have transferred their forces to these places to provide aid. On April 8 of this year, when some of China's private enterprises knew that there were still more than 1,000 villages being listed as impoverished, 31 companies proposed that each Chinese enterprise could help one poor village. After the proposal was sent out, there was a wide response from private enterprises and social organizations. There are now 833 private enterprises and 228 social organizations that have signed up to participate, and the two sides are negotiating how to cooperate, which has also strengthened efforts. 

The focused acceleration of poverty alleviation efforts has already had some effects. For example, the number of poor laborers from listed counties who left their hometowns to work has reached 102% of last year's total, which is seven percentage points higher than the national number. In the process of exporting laborers, our country established a point-to-point system. Throughout the pandemic, the listed counties have 105,000 people travelling to work. For example, Xinjiang Uygur autonomous region has relatively more poverty relief work. There are more than 300 villages in Xinjiang, as there are more than 300 villages in Liangshan Yi autonomous prefecture, Sichuan province. In those 300 villages of Xinjiang, all the cadres who came to aid did not return to their hometowns during this year's Spring Festival and instead stayed in the villages to perform poverty alleviation work, helping to ensure that the tasks can be completed this year. Thus, overall progress has been smooth. Thank you.

Reuters:

Affected by the epidemic and economic downturn, will those who have been lifted out of poverty fall into poverty again? This has already happened this year. What do you think of this risk? Thank you.

Liu Yongfu:

As I just mentioned, due to the impact of the epidemic, migrant workers in poverty were stuck in their hometown. In previous years, after the 15th day of the first lunar month, poor people would go out to work, but this year, their work time has been postponed. By the end of February, the number of poor people who left for work only accounted for 40% of last year's total. After two months of efforts in March and April, the ratio rose to 95%, basically reaching the same level as last year. However, the income lost over the past two months cannot be compensated. In addition, the production is damaged. Farmers who resumed production and prepared for spring plowing were faced with the shortage of production supplies. Now that we have addressed the issue, it can be said that throughout the country, the spring plowing among the poor is basically unaffected. What we need to prevent is a backlog of produce. Will it push people into poverty or make people return to poverty? We found that only a small number of people fell into poverty again. The reason is not entirely due to the epidemic; some of them were influenced by disasters and diseases. According to data, this year, the number of people who are prone to return to poverty and those who live on the edge of poverty has increased by 380,000. They have been included in the monitoring and assistance system along with millions of people who had been registered last year. Even if there was no COVID-19, there would still be people returning to poverty, and those on the edge of poverty would become poor. The epidemic becomes a driver for the increase of that number. For example, by the end of last year, 150,000 rural poor people had not met the goal of "free from worries over food and clothing and having access to compulsory education, basic medical services, and safe housing." This year, the number has increased to 340,000. Now, 250,000 people have achieved the goal, and there are still 90,000 people left across the country. We are clear of the number of people who are prone to return to poverty and those who are on the edge of poverty and their situation. Therefore, we will take measures accordingly. For example, if there is a reduction in the number of people leaving home for work, we will create jobs locally. We can make up for not being able to leave home for work by creating opportunities locally for them. The epidemic did exert influence, but we can take measures to counter the fallout. Thank you.

Farmers' Daily:

Concerning the epidemic's impact on the production and sales of products in impoverished areas, the State Council Leading Group Office of Poverty Alleviation and Development and relevant government bodies have made deployments and arrangements specifically to boost consumption as a way of poverty alleviation. What are these specific measures? How well do these measures work?

Liu Yongfu:

Over the years, some local industries have been developed to help poverty alleviation, such as the production of apples, walnuts, and Chinese dates, which have come onto the market this year. Of course, there will be products associated with poverty alleviation every season, and these products must be sold. Due to the impact of the COVID-19 pandemic, a series of works have been carried out under the joint efforts among the National Development and Reform Commission, the All China Federation of Supply and Marketing Cooperatives, the Ministry of Agriculture and Rural Affairs, the Ministry of Commerce, the Office of the Central Cyberspace Affairs Commission, as well as other government bodies concerning e-commerce and consumption to help poverty alleviation.

First, we have carried out the verification work of poverty alleviation products in Western China. What are poverty alleviation products? They refer to the products produced either by impoverished people, villages, and relevant cooperatives or by leading enterprises that help poverty alleviation. In short, poverty alleviation products are those which are associated with impoverished people and can also help lift people out of poverty. We've put effort into carrying out this verification. The verification is not a one-time thing. It will be constantly carried out all year round. So far, over 40,000 products have been verified, and the total value reached 390 billion yuan. We will continue to carry out the verification work in the future. As of now, the sales of these products reached 32.3 billion yuan.

As we all know, Hubei province is the worst-hit region of the epidemic this year. Our support for Hubei started in March with the improvement of the epidemic situation. Seven provinces in East China helped impoverished workers in Hubei go out for jobs. We've also helped Hubei sell its poverty alleviation products. According to the statistics from Hubei, the sales of well-known poverty alleviation products, such as crayfish, tea, and mushrooms, reached nearly 3 billion yuan. The working committee of the central and state organs has called on all units of the central and state organs to purchase the products overstocked in Hubei province. From mid-March, in less than two months, 99 government bodies have bought 186 million yuan of products. Each of them made a purchase of 1.87 million yuan on average. Therefore, first, we need to carry out verification of the poverty alleviation products. Second, we need to take various measures to consume these products.

Next, there are still several models regarding our work, such as government procurement and market trading. We can also encourage e-commerce companies to sell these products. Some social organizations are also working on public welfare projects in this field. In short, we will come up with various measures to help sell these high-quality products produced by impoverished people in impoverished areas.

The work in this field should be connected with the "rice bag" (i.e., grain supply) and "vegetable basket" (i.e., non-staple food supply) projects in cities of East China. These products from impoverished areas are of high quality, and sometimes people may find it difficult to buy these products. We need to step up our organizing efforts. Impoverished people are the producer, while people living in East China are the consumer. Thus, the sale and purchase of goods are not a burden, but a perfect match between them. We will continue our works in the next step. Of course, the quality must be ensured, and the price must stay reasonable. It is necessary to prevent seeking personal gain in the name of helping poverty alleviation. We've got a head start. Thank you.

Hong Kong Commercial Daily:

Since the beginning of this year, unemployment has reached relatively high levels as the number of job vacancies has been decreasing, and the manufacturing and catering industries - the two major employers of migrant labor - are still recovering. Therefore, my question is: What multipronged efforts are being taken to help migrant workers get employed? And, how are the funds designated for poverty alleviation being pooled?

Liu Yongfu:

I'll start by addressing the question about funding. The funds provided by the central government for poverty alleviation this year have increased 15.8%. Meanwhile, regions are required to increase rather than reduce their financing for the program, which can also receive support from the central government when necessary. In fact, we have pooled substantial funds that consist of agricultural funds, financial funds and aggregated social funds, in addition to the designated funds. When combined, these can remove the obstacles that impede the poverty alleviation work. Although it is true that there is never enough money, we still can evaluate the outcome using general standards. That is the situation with regards to funds.

Second, I will respond to your concern about employment. It is a fact that under the impact of the global pandemic and downward economic pressure, enterprises have received fewer purchase orders, which in turn has strained the operations of manufacturers and business entities. As a result, the unemployment rate has risen, with job markets around the world being affected - in this, China is no exception. However, whilst trying to avoid volatility in general, we have focused on the employment of migrant workers from poverty-stricken regions. With the goal of strengthening poverty alleviation through employment that I mentioned in the introduction , we have prioritized the impoverished labor force in the resumption of work and production. For instance, the number of rural workers on the move through chartered transportation since the outbreak of the pandemic, particularly across provinces, has reached 6.02 million. Of these, 1.52 million have been impoverished migrant workers, accounting for 25.2%, or over one quarter of the entire flow. You are aware that impoverished people accounted for 10.2% of the rural population as of 2012, however, now the exported labor force moving through "point-to-point" chartered transportation has reached 25.2%. This percentage shows the efforts of different localities in focusing on mobilizing impoverished populations.

Our efforts also focus on intra-provincial employment. Take the Xinjiang Uygur Autonomous Region for example. As a result of constant labor force demands from the northern and eastern parts of the region, more than 50,000 impoverished people from the south have been provided with job opportunities in these two areas. In addition, newly launched enterprises, poverty-alleviation workshops and leading enterprises have also provided jobs to the local labor force. So far, the autonomous region has created more than 3 million poverty-alleviation charitable posts, including, more than 1 million forest rangers, 850,000 photovoltaic workers - whose number is expected to reach 1 million by the first half of this year - and 250,000 road maintenance staff.

We have been overseeing these three efforts, namely, migrant labor force, charitable posts and localized employment. China has 290 million rural migrant workers, among which, about 26 million impoverished laborers have been mobilized. However, the rest, estimated at around 2.01 million, are still awaiting relocated job opportunities that have yet to be realized. The situation requires us to secure employment for these 26 million migrant workers before creating opportunities for the remaining approximately 2 million. Among the 290 million migrant workers, around 9% are classed as impoverished. These people will be given priority for employment with our preferential policies and solutions provided for employment issues. However, this does not mean that we will give every job opportunity to those classed as impoverished. But they will be given priority in the labor force market. Thank you.

Insight China:

Mr. Liu, what preferential policies and specific measures are the central government taking to help disadvantaged groups and poverty-stricken areas in Hubei province? Thank you.

Liu Yongfu:

Regarding supporting Hubei, the region hit hardest since the outbreak of COVID-19, General Secretary Xi Jinping visited the province to call for concerted efforts, not just within Hubei, but also in Eastern China and the central government bodies which are both supposed to help Hubei revive in terms of economic and social development in a timely fashion. In accordance with the instructions of the CPC Central Committee and the State Council, a full range of policies targeting economic recovery and poverty alleviation have been carried out headed by the National Development and Reform Commission (NDRC). In addition, the province will enjoy preferential policies in terms of designated poverty-alleviation funds distributed by central finance.

The Ministry of Human Resources and the State Council Leading Group Office of Poverty Alleviation and Development have initiated a labor force cooperation program entitled "Seven Plus One" between Hubei and seven eastern provinces with high numbers of impoverished migrant workers. In addition to poverty relief through consumption which has facilitated sales of commodities in poverty-stricken areas, financing and labor force coordination have also propped up the economy on the basis of the multipronged poverty alleviation scheme. The impoverished local labor force that has left home for work has approached to 90% of the same period last year. I predict that it will have reached the same level as last year by the end of this month and losses are likely to be restricted to the previous three months, from February to April. Thank you.

Hu Kaihong:

That concludes today's press conference. Thank you, Mr. Liu and thank you all.

.

Read in Chinese

Speakers:

Zhong Shan, minister of commerce

Wang Shouwen, vice minister of commerce, deputy China international trade representative

Wang Bingnan, vice minister of commerce

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

May 18, 2020

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). From today, we will hold more press conferences and invite officials from relevant departments to brief you on China's economic and social development. This morning, we are delighted to have Mr. Zhong Shan, minister of commerce and secretary of the leading Party group of the Ministry of Commerce, Mr. Wang Shouwen, vice minister and deputy China international trade representative, and Mr. Wang Bingnan, vice minister of commerce. They will brief you on stabilizing the fundamentals of foreign trade and investment and promoting the quality development of commerce as well as take your questions.

First, I will give the floor to Mr. Zhong.

Zhong Shan:

Thank you. I notice that you are all wearing masks, showing that you are dedicated to working cautiously. 

On behalf of the Ministry of Commerce, I would like to extend gratitude to friends from the media, for your attention, concern, assistance and support.

Last year, against the backdrop of a complex and severe domestic and international situation, China achieved positive results in commerce reform and development, with consumption, foreign trade, and foreign investment all hitting record highs. This year, the COVID-19 epidemic exerts a great impact on China's economic and social development. The situation of commerce reform and development has become more severe and complex, and we are facing greater challenges.

Under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, we have coordinated the work of epidemic prevention and control and commerce reform and development. Efforts have been made to expand domestic demand, promote consumption, and stabilize the fundamentals of foreign trade and investment. We have worked to promote the quality development of commerce, minimize the impact of the epidemic, and make new contributions to completing building a moderately prosperous society in all respects.

Next, my colleagues and I will answer your questions. Thank you.

Hu Kaihong:

Thank you, Mr. Zhong, for your very brief introduction. We will leave more time for questions. Please.

CCTV:

We all know that during the epidemic, securing the residents' basic necessities is a big challenge. In many countries, there are cases of panic buying and items running out of stock. But China did well in ensuring necessary supplies earlier. What did the Ministry of Commerce do in this aspect? Thank you.

Zhong Shan:

Ensuring the supply of the country's basic necessities is a tough task concerning people's livelihood and an important part of winning the battle against the epidemic. Generally speaking, China's market is in abundant supply amid the outbreak. Basically, the supplies weren't stopped or out of stock and prices were stable. The work we have done under the leadership of the CPC Central Committee is mainly in the following three aspects:

First, we worked to ensure supplies in key areas, including Wuhan, Beijing, and the other cities in Hubei province. On January 23, the Ministry of Commerce established a "nine-province joint supply mechanism," aimed to keep track of the supply and demand situation, secure the supply of daily necessities in key areas, and better deploy resources in a timely manner. At the same time, in order to implement various tasks concerning ensuring supplies, the Ministry of Commerce sent three batches of working teams to Wuhan, mainly for coordination and supervision. During the epidemic, the "nine-province joint supply mechanism" came into play when Wuhan was in short supply or in need of certain items. For example, when the epidemic broke out, vegetables in Wuhan were in shortage. Within two days, Chongqing city sent 400 tons of vegetables to Wuhan. During that time, Wuhan's disposable lunch boxes were also inadequate, and Hunan province collected enough boxes for them within 10 hours. In addition, provinces, such as Guangxi, Shandong, and Yunnan, that produce a large amount of vegetables all sent vegetables and basic necessities to Wuhan, and there were even special trains running to transport these supplies. After the joint supply mechanism was put into operation, the supply of daily necessities in Wuhan city and Hubei province was basically sufficient amid the epidemic. Apart from Hubei Province, eight other provinces whose supplies were limited chose to provide supplies to Wuhan and Hubei first as long as they were in need. Wuhan's supply was more abundant than the country's average level during its lockdown. We stocked more than one week's worth of daily necessities, such as rice, noodles, oil, meat, eggs, milk, fruits and vegetables, and the longest could last over 30 days. These supplies were much ampler than the national average.

Second, we have strengthened market coordination across the country. We have established a nation-wide daily briefing system that monitors and displays inventory information on eight key daily necessities. At the same time, we also made a list of 500 major businesses, including every link of the supply chain (production, wholesale, online and offline retail, and transportation) to ensure adequate supplies. For example, there was a time when Beijing had a shortage of instant noodles and meat, but the demand was quickly met through coordination. Similar demands of certain necessities were also met in other parts of the country through market coordination. In general, we have managed to ensure market supply across China.

Third, we have introduced new business and delivery models. After the COVID-19 outbreak, especially when communities in Wuhan were locked down, there was a time when the residents had problems buying groceries. In response to this, the Ministry of Commerce, in collaboration with other ministries, as well as the Hubei and Wuhan authorities, organized group buying or mass buying to help local communities reduce unnecessary outings. Moreover, we also mobilized over 1,100 vehicles and more than 20,000 volunteers to send vegetables and other needed groceries to communities. 

All of this could not have happened without the firm leadership of the CPC Central Committee with Comrade Xi Jinping at its core, as well as the concerted efforts of the whole country. It also fully demonstrated the advantages of socialism with Chinese characteristics and its mass mobilization ability to combat the epidemic. Thank you.

Market News International:

The foreign trade sector employs 180 million people. But some businesses have been forced to suspend production due to sluggish foreign demand during the COVID-19 outbreak. What will the Ministry of Commerce do to reduce the number of bankruptcies and stabilize foreign trade？

Zhong Shan:

Thanks for your question. As the COVID-19 outbreak spreads across the globe, China's foreign trade faces unprecedented challenges due to a large reduction of international demand. Our ministry will do the utmost to stabilize foreign trade according to instructions from the central government.

First, we will help businesses navigate their challenges. As you just said, many Chinese businesses now face difficulties like lack of funds, reduced orders, and risks in the industry and supply chains. In the early period of the outbreak, many businesses had difficulties sending out overseas orders due to logistical problems. While they have resumed productions, they now face reduced orders. Some of them could solve their problems through their own efforts, while some need government assistance in terms of financing, taxation and insurance. After the COVID-19 outbreak, the CPC Central Committee and the State Council have been trying to solve the issues businesses face and help them navigate the challenges. We have now seen that some of the policy measures are working. For example, it used to take over 10 days to complete the tax rebate procedures but now it only takes around a week, which helps export-oriented businesses with capital turnover. Credit scale is also expanded to help businesses with financing difficulties. Credit insurance coverage have also been enlarged. China Export & Credit Insurance Corporation has now provided help to around 110,000 businesses. Meanwhile, some firms that used to only focus on exports are now shifting to the domestic market with the help of the government. We have seen some good results. Domestic sales of those formerly export-oriented businesses grew by 17% in April. This means that their products are also popular among domestic consumers.

Second, we will refine the layout of the international market. Falling demand in the international market due to the pandemic by no means indicates a void of demand and market. While attempting to reinforce traditional markets abroad, we have also explored new ones. As the Chinese saying goes, "when one door closes a window opens." Therefore, despite plummeting demand from major developed countries, we still have other markets to tap into. Although imports and exports dropped 4.9% during the first four months of the year, trade with countries along the Belt and Road soared with an increasing share. More to the point, the Association of Southeast Asian Nations (ASEAN) has become our top trade partner. In addition to expanding exports, we have taken proactive measures to promote imports. We will hold the third China International Import Expo (CIIE) to satisfy domestic demand and facilitate open global economic cooperation.

Third, we will foster new forms and models of business. In recent years, cross-border e-commerce and market purchase trade have developed rapidly. This year, we accelerate the pilot work, and the number of comprehensive cross-border e-commerce pilot zones, in particular, has increased from an initially planned 59 to 105. We will support the growth of those new forms of business, foster new driving forces for foreign trade, and develop them into new highlights in foreign trade development. Thank you.

China Daily:

You just mentioned the countries along the Belt and Road. Last year, General Secretary Xi Jinping called for joint efforts to promote the high-quality development of the Belt and Road while addressing the second Belt and Road Forum on International Cooperation. My questions are: Has the pandemic created challenges that stand in the way of economic cooperation along the Belt and Road, especially regarding major projects? How will the Ministry of Commerce continue to help build the Belt and Road? Thank you.

Zhong Shan:

Thank you for your questions. We invite Mr. Wang Bingnan to answer them. 

Wang Bingnan:

Thank you for your questions. Since the Belt and Road Initiative was proposed more than six years ago, China and involved countries have followed the principle of extensive consultation, joint contribution and shared benefits. Notable achievements have been made in deepening pragmatic cooperation and promoting the high-quality development of the Belt and Road. Statistics show that from 2013 to 2019, the trade of commodities between China and the countries along the Belt and Road hit $7.8 trillion, direct investments from China to those countries exceeded $110 billion, newly contracted projects reached nearly $800 billion, and a huge number of major projects and industrial zones were set in motion. These have greatly helped to promote win-win cooperation and common development among them. The influence and appeal of the Belt and Road Initiative have continued to grow.

Just as the reporter mentioned, the impact of coronavirus on the world economy has been massive, and it has exacerbated the sluggishness of international trade and investments. The economic and trade cooperation along the Belt and Road has also been affected to some extent. For example, some projects have been obstructed by the loss of personnel and the lack of logistic supplies. And at the same time, epidemic prevention and control efforts have also put much pressure on them. 

While confronting such complexities, China and the countries involved have provided mutual assistance to surmount the difficulties and mitigate the impact of the pandemic. Generally speaking, the economic and trade cooperation along the Belt and Road has so far secured sound momentum. From January to April, commodity trade between China and the countries involved has climbed up 0.9% year on year by RMB, and China's direct investment in the non-financial sector to those countries rose 13.4% by US dollars. In the next phase, the Ministry of Commerce will follow the major polices and plans made by the CPC Central Committee and the State Council to advance the work of both epidemic prevention and control and economic and trade cooperation along the Belt and Road, promote its high-quality development, and contribute to building a community with a shared future for mankind. Our work will be carried out in four aspects as follows:

First, we will make more efforts to cope with the pandemic. We will continue to keep a close eye on the overseas situation of the pandemic and promptly work out policies and solutions that are targeted at solving difficulties and problems faced by enterprises that invest abroad. At the same time, we will deepen our communication and cooperation with involved countries, jointly working to ensure the security and stability of global industrial and supply chains.

Second, we will further promote trade cooperation. We will make full use of open platforms such as the China International Import Expo (CIIE) and the online Canton Fair, and further develop Silk Road E-Commerce. We will also promote the construction of "commodity passageways", such as China-Europe freight train services and new land-sea transit routes, and establish high-standard free trade zones in cooperation with more countries, so as to further promote trade liberation and facilitation to a higher level.

Third, we will expand investment cooperation. In accordance with the requirements to jointly promote high-quality BRI cooperation, we will work to carry out a batch of projects with sound overall benefits welcomed by all parties. We will implement a batch of aid projects helpful in developing the local economy and improving local people's livelihood. We will further promote the development of overseas economic and trade cooperation zones, and establish third-market cooperation with more countries, in order to continuously improve our capacity of outward investment cooperation.

Fourth, we will work to do a better job of telling BRI stories. Last year, we looked in detail at typical BRI projects and organized foreign and domestic experts to write, edit and publish the book A Bright Shared Future, Stories Along the Belt and Road in six languages. Launched both online and offline, these books have found a wide audience in and outside China. This year, we will continue to publish a series of books, and present vivid stories of BRI and international cooperation in fighting the COVID-19 pandemic, so that people around the world can gain a better understanding of the overall significance of a community with a shared future for all humanity, as well as about the operation of the BRI. In this way, we will jointly push forward the implementation of BRI. Thank you.

Phoenix TV:

Mr. Zhong, as the consumer market is gradually picking up, what measures will the Ministry of Commerce take to boost consumption? Thank you.

Zhong Shan:

Thank you for your question. China is the second largest consumer market in the world. For six consecutive years, consumption has been the biggest driving force for economic growth. The CPC Central Committee has taken expansion of domestic demand as a major strategy. The Ministry of Commerce will work to further expand domestic demand and boost consumption in the following aspects:

First, we will work to establish the "15-minute convenient life circle". Although there are many convenience stores in China, the sector is not fully developed. The number of chain stores in China, for example, only reaches 130,000, and this is far from enough to meet people's everyday needs. Next, we will optimize the layout of convenience stores, promote the development of convenience store chains. This will also be applied to farmers markets, because their quality varies despite of their obvious size, and they remain under-developed. Next, we will work to promote the standardized renovation of farmers market, optimizing the environment, increasing the variety, and improving the quality.

Second, we will work to transform and upgrade pedestrian streets in cities because they have a huge impact on urban consumption and are of high demonstrative significance. The Ministry of Commerce launched 11 pilot projects at the end of 2018 concerning the transformation and upgrading of pedestrian streets, and achieved excellent results. The total pedestrian flow of these 11 streets exceeded 900 million last year, increasing by 22.6% from 2018. Total income reached 125 billion yuan, up 17%. Next, the Ministry of Commerce will launch a second batch of pilot pedestrian streets, and work to turn them into a platform of consumption upgrading, a carrier of high-quality development, and a window for opening-up.

Third, we will work to develop the life service industry. This sector has seen rapid growth in recent years. However, the COVID-19 has had huge impact on catering and housekeeping services. The income of the catering sector in the first four months of this year fell 41%, whilst that of the housekeeping services also decreased drastically. We need to help related enterprises to develop in this difficult time. The catering industry is both a traditional and a "sunrise" industry. As the saying goes, "Food matters." The catering industry in China still has huge potential of development. It accounts for 11% of total retail sales of consumer goods, creating 21 million jobs. We need to support its development across China, and make it greener, healthier and safer. Another point is the development of housekeeping services. This is an industry with the countryside and cities at each end. China has abundant resources in this regard. There is much spare labor in the countryside and also huge demand in the city. Last year, the income of China's housekeeping services exceeded 690 billion yuan. We need to continue work in this field. The Ministry of Commerce has established a credit platform of housekeeping services. The move aims to regulate the operation of housekeeping companies, better protect the rights and interests of labor in this sector, and provide better services to urban families. Thank you.

CGTN:

We know the spread of the COVID-19 pandemic has had a great impact on the global industrial and supply chains, which mainly benefited from the free trade and transnational investment under the framework of multilateral trading system under the WTO. However, some days ago, the director-general of WTO, Roberto Azevedo, announced he would step down in advance of his full term. What kind of influence will his resignation pose for the global multilateral trading system and the work of WTO? Will it have an impact on the safety of global industrial and supply chains? Thank you.

Wang Shouwen:

Thank you for your question. You are right. The pandemic has had a huge impact on the world economy and its trade, global industrial and supply chains. Since the outbreak of the virus, the WTO has taken active actions and implemented a series of measures, such as appealing to its members not to adopt protectionism, so as to guarantee unimpeded trade. If they decide to carry out trade restrictive measures in order to address the consequences of the pandemic, these should be reported to the WTO to ensure openness and transparency. The WTO also specifically established a response team and set up a topical website, playing important roles in the fight against the pandemic.

To address the crisis more effectively, the WTO primary members decided the organization should play a greater role. Last Thursday, the Second Extraordinary G20 Virtual Trade and Investment Ministerial Meeting was convened with the participation of Minister Zhong Shan. The meeting passed the "G20 Actions to Support World Trade and Investment in Response to COVID-19." Its announcement called for widespread support to promote the WTO in playing an even greater role in advancing international trade stability and predictability. It also requested the exploration of more WTO initiatives related to tackling the consequences of the COVID-19 outbreak, so as to ensure related supply chains became more open and resilient, especially in expanding production and trade of medicines, medical and health products.

You've just mentioned the WTO director-general proposed to resign before expiry of his tenure. China respects his decision and will endeavor to ensure the smooth operation and the role of WTO together with other members. Against the backdrop of the ongoing pandemic, we hold that jointly safeguarding the openness, safety and stability of international industrial chains serves the interests of all parties. We also appeal to WTO members to oppose unilateralism and protectionism, maintain open domestic markets and support the stability of international trade industrial and supply chains. We also called on all parties to enhance coordination in creating economic and trade policies so as to ensure smooth international transportation, normal operation of international logistics, and safe, stable, open and smooth trade, industrial and supply chains between nations. Thank you.

Hong Kong Commercial Daily:

Since the outbreak of the COVID-19 pandemic, the production and operation activities of some foreign-invested enterprises has been impacted. It is being suggested some will transfer outwards, raising some concerns about the prospects of China's utilization of foreign capital. What's your opinion on that, Minister Zhong Shan? What measures will the Ministry of Commerce take to stabilize foreign capital. Thank you. 

Zhong Shan:

Thank you for your question. The spread of the pandemic truly has had an impact on transnational investment and China's utilization of foreign capital also faces great challenges. Under the leadership of the CPC Central Committee, we will focus on three key tasks regarding stabilizing foreign capital.

First, we will expand opening-up to a greater extent. The more difficult the situation, the greater the needed openness. We will continuously relax restrictions on the market access, reduce negative lists and expand openness of the service sector. Some of these works are already underway and some will be conducted soon. We will enhance regional synergy openness and promote implementation of significant strategies like the integrated development of Beijing and Tianjin municipalities and Hebei province, the Yangtze Economic Belt, and the Guangdong-Hong Kong-Macao Greater Bay Area, so as to advance regional interaction and openness, and bring along all-round opening. We will step up opening of the central and western regions and old industrial bases, which now have better development conditions. What's more, many supportive polices have been issued by the central government targeting these regions. We encourage more foreign businessmen to invest in central and western China and the old industrial bases in Northeast China.

Second, building an open platform. The pilot FTAs and free trade ports are the new heights of reform and opening up in the new era. We must build these open platforms well so that they can play a demonstrative and leading role. The 18 pilot FTAs established since 2013 have produced a batch of replicable and transferable outcomes by using foreign investment that accounts for 15% of the country's total. Next, we will expand the pilot FTAs, give them greater freedom in reform, and promote new opening up measures. At the same time, we will further accelerate the construction of Hainan Free Trade Port.

Third, improving the business environment. China has seen an increasingly better business environment in recent years. The world ranking of the country's business environment increased from 46th to 31st in 2019, which is great progress. This year, we will focus on implementing the Foreign Investment Law, creating a market environment for fair competition, protecting the legitimate rights and interests of foreign investors as well as intellectual property rights, and enhancing the confidence of foreign investors in long-term investment in China, so that they are willing to come, stay, and develop here.

I would like to emphasize that China has obvious advantages in the use of foreign capital. The country has rich and high-quality labor resources, sound capabilities in offering industrial support, and a market of 1.4 billion people. I believe smart entrepreneurs will not give up the huge Chinese market. Thank you.

CNBC:

As the pandemic spreads around the world, countries are paying more attention to this year's China International Import Expo (CIIE). How is the preparation for the third CIIE going? Will it be affected by the pandemic? What differences do you think there will be between this year's expo and the previous ones? Thank you.

Wang Bingnan:

Thank you for your question. The CIIE was planned, arranged and promoted by President Xi Jinping. It is China's major initiative to pursue opening up and widen market access to the rest of the world. Successfully held for two sessions, the expo has seen its role as the platforms for international procurement, investment promotion, people-to-people exchanges and open cooperation increasingly highlighted. It brings along increasingly higher comprehensive benefits. It has a great impact and has been widely praised worldwide.

The third CIIE will be held in Shanghai, China, from Nov. 5 to 10 this year. Its overall framework will be roughly the same as the previous two, comprising three major sections – National Trade Investment Comprehensive Exhibition, Corporate Business Exhibition, and Hongqiao International Economic and Trade Forum.

All the preparations are underway in an orderly and smooth manner. Compared with the previous two sessions, it has the following characteristics in general:

First, a larger scale. Companies worldwide showed great enthusiasm for the expo, with many of them saying that the third CIIE is one of the most important exhibitions in the world this year. We plan to further expand the exhibition area based on the previous session. The current exhibition area under contracts signed so far already exceeds that of the same period last year.

Second, a higher quality. More first-class companies and products will participate in the third CIIE. The world's top 500 and leading companies in their industries will continue participating in the expo with new products, technologies and services. New exhibitors and "hidden champion" companies will also bring featured products to the expo this year.

Third, a better structure. Considering the new development and new requirements of the global economy, we have also set up exhibition areas for public health and epidemic prevention, energy conservation and environmental protection, as well as smart travel. More than 30 Fortune 500 companies and leading companies in the public health field have signed up for the expo, whose exhibition area has already surpassed 5,000 square meters. Work related to the National Trade Investment Comprehensive Exhibition, Hongqiao International Economic and Trade Forum, and urban service guarantee are all underway steadily as planned.

As the pandemic hits the economy and trade, we will hold the third CIIE this year to continue expanding imports and opening up the Chinese market. This move fully demonstrates China's role as a major responsible country and its importance in accelerating the recovery and growth of the global economy and building an open global economy.

We have formulated a thorough work plan and implemented stringent measures for epidemic prevention and control. By working with various parties, we are confident in making it a first-class international expo featuring a larger scale, better quality, stronger innovation, higher level, and greater achievements.

Friends from the media strongly supported the previous sessions. More than 4,000 Chinese and overseas journalists cover the events every year, making significant contributions to the expo's success. I would like to express my heartfelt thanks to you and send you an invitation to the third session. Thank you.

CRNTT:

We have seen that the pandemic has had a huge impact on the global economy as well as international trade and investment. Will this affect the scheduled signing of the RCEP agreement? How are RCEP negotiations progressing？And what is your opinion on India's pulling out of signing the pact? Thank you.

Wang Shouwen:

Thank you for your questions. At the third RCEP Leaders' Summit held last November, leaders of countries taking part announced a joint statement that 15 participating countries had concluded text-based negotiations, which substantially concluded all negotiations on market access and called for participating parties to begin a legal review of the text for signing in 2020. The statement also mentioned that India had some outstanding issues to be resolved and that all RCEP members would work together to resolve these issues in a mutually satisfactory manner.

The COVID-19 pandemic this year has indeed impacted negotiations and the organizing of conferences. However, RCEP members have improved their work plan by holding video conferences instead of face-to-face meetings, and increased the frequency of video conferences. Negotiations on the RCEP are still underway, with a few remaining issues in intensive negotiations by all participating countries. We have completed the legal review of approximately 80% of the text and plan to fully complete the review by the end of June.

During RCEP negotiations, the Association of Southeast Asian Nations (ASEAN) has played a central role, with the constant support of China. We continue to support such a role in promoting legal review of the text and signing of the agreement this year. We will work towards the agreement being signed at this year's RCEP Leaders' Summit. We believe the signing of the RCEP agreement this year in the context of the pandemic will be hugely significant to the region's efforts in dealing with the pandemic's negative impact on trade and investment. More importantly, the signing of the agreement will be of great importance to the rapid and robust recovery of the regional economy after the pandemic.

As for India, RCEP members have been working on India's concerns in a bid to find and promote a mutually satisfactory approach to these issues as required at the RCEP Leaders' Summit held last year. Not long ago, a letter sent by the 15 RCEP nations via the RCEP's trade negotiating committee chairperson included an offer for India to rejoin the RCEP talks. China welcomes India's return to the talks at an appropriate time. Thank you.

Hu Kaihong:

Now for the final question due to time constraints. If you have more questions, please contact the information office of the Ministry of Commerce.

Economic Daily:

As we all know, 2020 is the crucial year for completing the building of a moderately prosperous society in all respects and winning the final battle against poverty. During his inspection tour of Zhashui County in Shaanxi province, General Secretary Xi Jinping emphasized that e-commerce is an emerging business with great potential, which can promote sales of agricultural products. Mr. Zhong, what work has been done by the Ministry of Commerce to reduce the impact of the epidemic, win the final battle against poverty, and especially to promote targeted poverty alleviation through e-commerce? And what have been the achievements? Thank you.

Zhong Shan:

Thank you for your questions. Over the past three years, the Ministry of Commerce has carried out five measures to boost commerce in order to reduce poverty, and they are all making good progress.

The first is to alleviate poverty through e-commerce. Last year, we worked with related departments to achieve full coverage of all national-level poor counties in the development of e-commerce. That is to say, all poor counties now have e-commerce operations. Local governments have focused on this work and it has received positive reviews from people in the areas. Last year, the national e-commerce sales of impoverished counties reached 239.2 billion yuan, which marked a year-on-year increase of 33%. Introducing e-commerce to rural areas has indeed benefitted farmers. China has a large population and covers a vast area, so transportation can be inconvenient, particularly in many mountainous areas. These areas have high-quality agricultural products and local specialty products. However, limited transportation and promotion have made it difficult for people to sell their goods, while urban customers had no way to access these products. E-commerce provides a solution to these problems. For instance, fruits, vegetables and eggs from rural areas have huge markets in urban areas. 

You just mentioned that farmers in the area where General Secretary Xi Jinping went on an inspection tour have become prosperous by utilizing e-commerce. In fact, there have been many cases of this. For example, in one family from Huan County in Gansu province, a father had been raising sheep his whole lifetime, but he could only sell them to the sheep dealers. After his son graduated from university and returned home to start a business, he reached the market through e-commerce. Last year, the son sold all the sheep raised by his father through e-commerce, and helped to sell all those raised in neighboring villages. In total, they sold 13,000 sheep for 20 million yuan. This is a typical example. This year, we will scale up efforts to reduce poverty through e-commerce, promote the development of e-commerce in poor areas to increase the income for the 5 million farmers in poor areas.

The second is to alleviate poverty through household services. We carried out a series of poverty alleviation measures, encouraging city households in over 100 cities to employ people in the registered poverty-stricken families for housekeeping services. This has helped over 500,000 people in these villages and poor areas to find jobs. Last year, I travelled to Guang'an in Sichuan province to conduct inspection and research works. There, we visited one family which had got out of poverty. The hostess worked in the household service industry. She explained that the local government had helped her find a housekeeping job in the city, thereby increasing the family's income and allowing the whole family to get out of poverty. Having escaped poverty, she brought eight friends from her village to find housekeeping jobs in the city, all of whom were happy and satisfied. This year, the Ministry of Commerce will scale up efforts to reduce poverty through household services and strive to help 700,000 people in villages and poverty-stricken areas to find jobs. 

In addition, we are also alleviating poverty by providing labor services overseas, through industrial development as well as border trade. These works are currently being carried out in full swing. For example, in achieving poverty alleviation through foreign labor service cooperation, we had 9.92 million workers overseas last year, including over 50,000 people from poverty-stricken counties. For poverty alleviation through industrial development, we have launched programs connecting farm to supermarkets and wholesalers, thereby expanding sale channels of farm products. For poverty alleviation through border trade, last year, our border trade reached $51.5 billion. At the same time, we have also provided assistance to border economic cooperation zones and offered jobs to over 180,000 people. This has helped promote the vitality of border areas and enriched the people living there. 

Faced with huge task of poverty alleviation, we will continue to follow the important instructions made by General Secretary Xi Jinping. We will do our best to work on the five measures for poverty alleviation and make more contributions to the work in order to win the final battle against poverty and achieve a moderately prosperous society in all respects. Thank you.

Hu Kaihong:

On the topic of poverty alleviation, we will hold another press conference this afternoon. Mr. Liu Yongfu, director of the Office of State Council Leading Group of Poverty Alleviation and Development, will brief the media on it. We welcome your attention.

That concludes today's press conference. Thank you, Minister Zhong Shan. Thank you, Vice Minister Wang Shouwen and Wang Bingnan. Thank you all.

.

Read in Chinese

Speakers:

Zeng Yixin, vice minister of the National Health Commission (NHC)

Cui Gang, class-II counsel of the Bureau of Disease Prevention and Control of the NHC

Guo Yanhong, supervisor of the Bureau of Medical Administration of the NHC

Liu Dengfeng, supervisor of the Department of Health Science, Technology and Education of the NHC

Li Mingzhu, supervisor of the Department of International Cooperation of the NHC

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

May 15, 2020

Hu Kaihong:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Through arduous efforts, China's fight against COVID-19 has achieved major results with strategic significance. The prevention and control measures have also been normalized. Today, we have invited Mr. Zeng Yixin, vice minister of the National Health Commission (NHC), who will introduce China's regular prevention and control of COVID-19, and also answer some of your questions. Also present with us today are Mr. Cui Gang, class-II counsel of the Bureau of Disease Prevention and Control of the NHC; Ms. Guo Yanhong, supervisor of the Bureau of Medical Administration of the NHC; Mr. Liu Dengfeng, supervisor of the Department of Health Science, Technology and Education of the NHC; and Mr. Li Mingzhu, supervisor of the Department of International Cooperation of the NHC. First, let's give the floor to Mr. Zeng Yixin.

Zeng Yixin:

Friends from the media, good afternoon.

Since the outbreak of COVID-19, under the strong leadership of the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, and through the nationwide arduous efforts, China's fight against the pandemic has achieved major results with strategic significance. Recently, General Secretary Xi Jinping has chaired a series of meetings of the Standing Committee of the Political Bureau of the CPC Central Committee, studying how best to deploy and improve the normalized prevention and control measures. Aiming at "forestalling imported infections and domestic resurgence," these meetings have strengthened guidance of the prevention and control efforts in key areas, consolidated current results and provided strong support for the comprehensive resumption of the social and economic order. On May 14, General Secretary Xi Jinping chaired another meeting of the Standing Committee of the Political Bureau of the CPC Central Committee, studying effective implementation of regular epidemic prevention and control measures. It was stressed that we must never allow our hard-earned previous achievements on epidemic control to be made in vain, and we must ensure the victory in the battle against extreme poverty and the completion of the building of a moderately prosperous society in all respects.

Recently, the Central Leading Group for COVID-19 Prevention and Control issued guidelines in regard to promoting orderly resumption of work and production whilst effectively preventing and controlling the epidemic. It requires coordination between epidemic prevention and control and social and economic development, accelerating restoration of normal daily life and carrying out orderly resumption of work and production with a normalized situation of epidemic prevention. The State Council Joint Prevention and Control Mechanism also issued guidelines on the work to implement regular epidemic prevention and control. Specific measures include focusing on precautions; implementing early detection, reporting, isolation and treatment; prioritizing key steps; ensuring support and supply, and strengthening leadership, to name a few. Notices have also been issued to further build the capacity of medical institutions in regard to reducing the risk of nosocomial infection. Efforts are being undertaken to inspect the resumption of work and production as well as epidemic prevention and control in enterprises and institutions. The Ministry of Education and the NHC also jointly issued a technical plan for epidemic prevention and control in primary and middle schools, as well as nurseries and kindergartens, to help ensure orderly reopening of educational institutions. In accordance with the requirement of the CPC Central Committee, regions across China have been working promptly to implement various epidemic prevention and control works.

The NHC has been actively carrying out international cooperation to tackle the COVID-19 pandemic, sharing "China's experience" and "Chinese methods" with the rest of the world, and providing as much assistance and technical support to countries and regions as possible. Over the past week alone, the NHC talked over the phone and via video links with health ministers from Central and Eastern Europe, Germany, the U.K., Japan, and South Korea. It also held technical communication with African countries, during which China introduced its experiences in dealing with the novel coronavirus. Many experts have been sent to a number of countries to support their work.

Currently, China's epidemic prevention and control work is being carried out in a steady and orderly manner, whilst the resumption of production and everyday life has been accelerated. However, we must still be aware that there are sporadic cases domestically, and there is still an arduous task in preventing any rebound. Clustered infections have been reported in parts of China's Heilongjiang and Jilin provinces, promoting further continuous spread of the virus. In addition, the epidemic situation outside China is still severe, imposing great pressure on efforts to prevent imported infections. The future trend of the COVID-19 pandemic contains many uncertainties. We need to raise awareness of the severe situation of "forestalling imported infections and domestic resurgence," as well as various potential risks. We also need to avoid carelessness, slackness and taking chances, and further secure the current achievement being made under the joint prevention and control mechanism. 

Next, the NHC will continue to implement the decisions and deployments of the CPC Central Committee and the State Council in regular epidemic prevention and control. The NHC will work hard to help establish a regular epidemic prevention and control mechanism in which cases are detected in a timely way, are promptly handled, precisely prevented and effectively treated. The prevention efforts in key regions and places will be prioritized. The NHC will continue to help enterprises, institutions and various types of public places to implement the prevention requirement, providing guidance to people regarding their personal protective measures. The NHC will also help schools to work out details of their reopening plans in order to ensure the safety and health of teachers and students. Although the epidemic prevention and control in Hubei province and Wuhan city has turned from an emergency plan to a normalized one, we exert every effort to strengthen and improve community-based prevention and control, and conduct nucleic acid tests and other works. The clustered infections in Heilongjiang and Jilin provinces need to be handled in a timely and prompt manner. The cause for the infection should be quickly investigated so as to curb any further spread. We need to strengthen the epidemic prevention and control efforts during the "Two Sessions." Border cities also need to build their capacity in epidemic prevention and control, improving their ability in monitoring, testing and treating, in order to effectively forestall the spread of imported cases. The implementation of all these measures will effectively protect people's safety and health, accelerate the restoration of production and everyday life, and provide strong support for the orderly resumption of work, production and schools.

Hu Kaihong:

Thank you, Mr. Zeng. Now the floor is open for questions.

CCTV:

Wuhan is conducting nucleic acid testing on all its residents. Why is the city doing this? The State Council joint prevention and control mechanism recently issued a guideline on regular prevention and control of COVID-19, stipulating that key groups will all be tested and other groups will all also gain access to testing. Can you please explain, in detail, how this will be implemented? Thank you.

Zeng Yixin:

The purpose of arranging nucleic acid tests for all residents in Wuhan is to better understand the range of the epidemic, proactively spot the infected, and strengthen the work of nucleic acid testing and infection screening. The massive testing aims to implement the principle of early detection, reporting, isolation and treatment. It also provides a vital guarantee for the coordinated resumption of work, production and schools and regular epidemic prevention and control. Based on a comprehensive and scientific evaluation of infection risk and testing capacity, the expanded nucleic acid testing will facilitate the work of targeted prevention and control of the pandemic, safeguard people's health, promote a reasonable flow of the population and accelerate restoration of social and economic activities and normal daily life in a comprehensive way. Other regions can also adjust and improve their epidemic prevention and control measures according to their own situations, just like Wuhan. The measures and ranges of nucleic acid testing can be dynamically differentiated in accordance with specific needs and testing capacity. It is a very arduous task to conduct nucleic acid testing for all residents in Wuhan. To guarantee the testing is effective, we have to make sure that the group of people tested earlier have no close contact with the following group of people tested. Technically, we also have to ensure a stable sensitivity if we adopt the sample-integrated solution in testing. It is indeed tough work, but we will make efforts to complete it. 

On May 7, the State Council joint prevention and control mechanism listed a range of targeted and practicable measures in its guideline on regular prevention and control of COVID-19. We have taken the following steps to implement the guideline.

First, we are expanding the testing range to lower the risk of the pandemic spreading. Various regions shall set and dynamically adjust their testing strategies and ranges while ensuring key groups are all tested and other groups also have access to testing.

Second, we are improving testing capacity to satisfy demand. We will enhance lab facilities in disease control institutions, medical establishments and customs; encourage social institutions to provide testing services; make more efforts in research, approval and marketization of testing equipment, solutions and detection reagents; and improve the production capacity of relevant equipment, testing kits and consumable materials. Quite a few approved testing kits have entered the market, but we still have lots of work to do to ensure they are constantly upgraded via unremitting research and development. 

Third, we are improving work mechanisms to improve testing efficiency. Relevant departments should shoulder their responsibilities and conduct testing in an orderly and organized manner. Residential communities should mobilize residents to assist in and cooperate with testing work and, in accordance with the law, observe prevention and control measures, such as sample collection, detection, isolation and treatment. The support and cooperation of the people are badly needed to ensure this work is properly carried out.

Fourth, we are reinforcing organization and management to further consolidate the work of testing. Governments at all levels should make strengthened testing an important part of their work for regular prevention and control of COVID-19, provide more policy and financial support and rapidly improve nucleic acid testing capacity, which will cement the achievements we have made in epidemic control and effectively prevent a rebound of the epidemic. 

That's it. Thank you.

TASS:

What do you think of China's cooperation with the WHO and relevant countries since the outbreak of the epidemic? I heard that China rejected the WHO's request to send a mission to visit the P4 lab in Wuhan. Is it true? Thank you.

Zeng Yixin:

Mr. Li Mingzhu will answer your questions.

Li Mingzhu:

Thank you for your questions. Amid the grave and complex global epidemic situation, China is faced with arduous tasks of preventing imported cases and guarding against domestic resurgence. While ensuring effective prevention and control of the disease at home, we have actively carried out international cooperation. At the multilateral level, we have worked closely with the WHO and the G20, implementing cooperation initiatives proposed by the two organizations. At the bilateral level, recently we held a video conference of health ministers from China and central and eastern European countries, a China-U.K. health ministers dialogue and a video conference for the health ministers of China, Japan and South Korea. These are all exchanges at the government level. In terms of technical issues, we have held video conferences with 12 African countries on the sharing of experience in fighting COVID-19. In addition, at the request of relevant countries, we have sent 21 teams of medical experts to 19 countries to help fight against the virus. Their work has been highly appreciated at the local governmental and public levels.

The WHO, as a specialized agency of the United Nations, plays an important leading role in coordinating global health issues. China attaches great importance to its cooperation with the WHO, and firmly supports the organization in organizing global anti-epidemic cooperation. Since the outbreak began, we have been sharing information with it, as well as the broader international community with an open, transparent and responsible attitude. We have established a mechanism for technical exchanges with WHO experts, and held many technical exchange meetings. We also invited WHO experts to conduct field visits in China. From Jan. 20 to 21, we received a team of its experts for a field visit in Wuhan. The team visited medical and health institutions, including laboratories. The members of the team had in-depth exchanges with local experts. From Feb. 16 to 24, we received the WHO-China Joint Mission on COVID-19. The mission conducted on-site visits in Beijing, Sichuan, Guangdong and Wuhan, and undertook comprehensive and in-depth investigations into the epidemic situation, prevention and control measures, medical treatment as well as scientific research. They also gave China and other countries valuable and constructive advice on the prevention and control of the outbreak. The WHO has never asked to visit a specific lab in China, so the allegation that China rejected WHO's request to visit a lab in Wuhan goes against the facts. Thank you.

The Straits Times:

I have two questions. The first question is: Can you please comment on two specific allegations made by U.S. State Secretary Mike Pompeo that the National Health Commission had ordered virus samples destroyed on Jan. 3 and that China had not shared virus samples with other countries? My second question is: Why does the NHC insist on not including asymptomatic cases in its official tally, when such cases are proven to be infectious and clearly a cause for concern? Thank you. 

Zeng Yixin:

Mr. Liu Dengfeng will answer the first question.

Liu Dengfeng:

The allegations disseminated by these U.S. officials are purely out of context and intentionally mislead people. In the face of the pneumonia outbreak of unknown cause, pathogen identification was the primary task, which was also the basic work for scientific prevention and control. We attached great importance to this, and we immediately organized national high-level professional institutions to conduct the parallel identification of the pathogen. They worked around the clock, day and night, to identify the pathogen as soon as possible. In this case, we also maintained a high degree of vigilance against the pathogenicity of the virus, and organized experts to conduct comprehensive research and evaluation. To prevent the leakage of biological pathogen samples and ensure biological safety — and based on the comprehensive research and opinions of experts — we determined to handle the pathogen causing unexplained cases of pneumonia temporarily as class II highly pathogenic, and we made clear biosafety requirements for collection, transportation, experimental activities and destruction, etc. According to the relevant requirements of the "Law of the People's Republic of China on Prevention and Treatment of Infectious Diseases" and "Regulation on the Bio-safety Management of Pathogenic Microbe Labs," we issued relevant documents on Jan. 3 with the major aim of guarding against the risks of laboratory biosafety and preventing secondary hazards caused by unknown pathogens.

At the same time, in order to further strengthen and regulate laboratory biosafety work, we issued laboratory biosafety guidelines for pandemic prevention and control, which also played an important role in preventing biosafety risks. In fact, China's laws and regulations have set clear requirements for the storage, destruction and experimental activities of highly pathogenic microorganism samples. If the laboratory conditions cannot meet the requirements for the safe preservation of samples, the samples should be destroyed on the spot or transferred to a professional institution for safekeeping. All of these measures are clearly stipulated. At the same time, these are also work requirements set by laws and regulations for laboratory biosafety supervision departments.

Regarding the sharing of pathogenic microbial strains, China has always maintained an active and open attitude. China has always been an active contributor in the sharing of pathogenic microbial strains. For example, in recent years, in order to prevent a global influenza pandemic and under the WHO framework, we have provided many highly pathogenic influenza virus strains to the U.S., Japan, the United Kingdom, Australia, Canada and Russia. Regarding the sharing of novel coronavirus strains, we also have an active and open attitude and are willing to share novel coronavirus strains in an orderly manner within the framework of the WHO, further strengthen international cooperation and scientific research and promote the development, production and equitable distribution of COVID-19-related vaccines, diagnostic tools and therapeutic drugs. Thank you.

Zeng Yixin:

Let me answer the question regarding the reporter's concern about asymptomatic cases. In fact, this issue has been specifically studied by the NHC, mainly based on three considerations.

First, the asymptomatic infected people we are talking about actually comprise two groups. The first group includes the so-called recessive infected people. After they are infected with the virus, they have no symptoms from beginning to end, or the symptoms are very mild. The other group of people includes those who are still in the incubation period after infection. Symptoms may appear later, but there may be no symptoms at the time of testing, which is considered part of the incubation period. As such, they are neither appropriately classified as confirmed cases nor recessive infections because they are undergoing changes. So we refer to all these people as "asymptomatic cases," and this is how we handle them from a managerial perspective.

Second, you may notice that we report asymptomatic cases who are detected every day, in addition to the confirmed cases and suspected cases. There is a particular part of our reports dedicated to reporting asymptomatic infected people, so our information is open. We are also reporting how many asymptomatic cases have turned into confirmed cases on a daily basis. Our information is open, intact and complete.

Third, we pay the same attention to asymptomatic cases as to suspected and confirmed cases, and we are also taking corresponding isolation measures and strict medical observation measures. Some individuals gradually develop symptoms and become confirmed cases, while some of them merely recover. We have been paying close attention and we are taking very strict measures to supervise these people.

This is why we still use the term "asymptomatic cases." We have studied this issue repeatedly, and this is why we do it this way. Thank you.

Bloomberg:

There have recently been media reports saying that on Jan 14 the NHC predicted an outbreak would occur. Six days later, on Jan 20, China publicly confirmed the existence of the human-to-human transmission of the novel coronavirus. What's your comment on this? Some American officials have claimed that China didn't share materials and data about the virus in a timely fashion. What's your response? Thanks.

Zeng Yixin:

I'd like to make an introduction first. The term "human-to-human transmission" you just mentioned is a simplified way of describing this phenomenon. The accurate and scientific way of saying this should be 'the abilities and means of the virus to spread among people.' Technically, bacteria and viruses both have the potential to spread among people, but they spread with different abilities and in different ways. Some of them indeed work in very different ways. For example, tuberculosis is a disease caused by bacteria that easily spreads through the respiratory system. Norovirus is highly contagious and commonly spreads through the fecal-oral route. Hepatitis B is an infectious disease caused by a virus that can be passed on through blood and from a mother to her child. AIDS is also caused by a virus, and it can be transmitted through sex and blood contact. The latter two diseases are not easily transmitted from one person to another. I want to first be clear about these distinctions.

At the earlier stage of the virus outbreak, it was hard to ascertain the causative agent, incubation period, spreading abilities, transmission ways and origin of the virus. The NHC immediately organized experts from multiple disciplines to study the etiology and epidemiology with limited clinically diagnosed cases to find out the manifestation of the disease and offer a scientific solution for outbreak control and prevention.

On the evening of Dec. 30, 2019, the NHC learned that there were patients with pneumonia of an unknown cause in Wuhan city. The leading Party members' group of the NHC attached great importance to this information. In the wee hours of the morning of Dec. 31, the NHC sent a working group and an expert team to Wuhan to conduct an investigation and guide the epidemic response.

On Jan. 1, 2020, the NHC set up a leading group to determine the emergency response strategy for the epidemic, carry out research and make arrangements. The NHC led experts and workers to provide guidance and urge Hubei province and Wuhan to carry out epidemic prevention and control along with relevant medical treatments.

On Jan. 3, the NHC organized scientific research institutions to carry out parallel laboratory testing of the samples for pathogen identification.

On Jan. 5, laboratory test results ruled out respiratory pathogens, such as the Severe Acute Respiratory Syndrome coronavirus (SARS-CoV), influenza, avian influenza and adenovirus. On Jan. 7, the Chinese Center for Disease Control and Prevention (China CDC) succeeded in isolating the first novel coronavirus strain. On Jan. 9, the expert team from the NHC made public research result of the pathogen, saying a new type of coronavirus was initially identified as the cause of the pneumonia of unknown cause.

On Jan. 10, testing kits were developed, which were then improved over almost seven days. Wuhan city organized tests of the relevant cases that had been admitted at hospitals in the city. On Jan. 12, the NHC shared with the WHO the genome sequence of the novel coronavirus in order to help other countries quickly diagnose patients and ring the alarm bell to the world.

On Jan. 13, Thailand reported the first imported case from Wuhan city. The NHC paid great attention to this development and requested that Wuhan city further intensified epidemic prevention and control. This firstly involved handling 'the entrance.' Wuhan strictly managed farmers markets and wildlife. Secondly it involved handling 'the exit.' Wuhan further strengthened body temperature monitoring of people at airports, train stations, bus stations and ports. Thirdly it involved reducing crowd gatherings. In addition, the NHC standardized local authorities' reporting and releasing of the information on the epidemic, meanwhile explaining to the public relevant policies and measures and providing them with knowledge on disease prevention.

We held a teleconference on Jan. 14 to deploy epidemic prevention and control efforts and stressed that there was huge uncertainty when it came to the emerging infectious disease caused by the novel coronavirus. Further in-depth research was needed to know the human-to-human transmission capacity of the virus and the way the virus passed between humans. The possibility of further outbreaks could not be ruled out. We also made clear requirements for Wuhan city and Hubei province. At that time, we were still in the process of further understanding the virus. There were many unsolved questions, and we were working hard to get answers.

We got a relatively accurate understanding of the human-to-human transmission capacity of the virus on Jan. 19 thanks to the unremitting efforts of expert groups and local medical workers. On Jan. 20, the executive meeting of the State Council classified COVID-19 as a Category-B infectious disease and took preventive measures against it on the level of a Category-A infectious disease. After that, the nationwide situation with respect to epidemic prevention and control became better known to all.

Now, when we look back, it was the first time in human history that we have faced COVID-19. In the early stages, under the strong leadership of the CPC Central Committee and the State Council, we accumulated evidences as fast as we could, deepened our understanding of the virus and explored methods of prevention and control. At the same time, by sticking to bottom-line thinking, we were highly aware of risks and focused on people's safety and health. We made prevention and control policies in accordance with the law and science and performed our duties to strictly implement them.

You mentioned the communication and exchanges with the United States. Mr. Li Mingzhu has offered some descriptions just now. I should say that we started communicating with the U.S. very early. We communicated in multiple ways and with high frequency. There were communications between health ministers, the ones between directors of the CDCs and those between experts and professors of the two countries. We had no reservation or hesitation in communicating. We did our best to share information and boost pandemic prevention and control efforts in the two countries and all over the world.

Beijing Youth Daily:

According to current data, the COVID-19 pandemic is still serious, but most countries in Europe and the United States have now gradually relaxed their control measures. Clustered infections have occurred successively in some parts of China, and this raises concerns about the possibility of a second outbreak. What is the Health and Safety Commission's stance on this? What countermeasures are being taken? Thank you.

Zeng Yixin:

For this question, I'll give the floor to Cui Gang.

Cui Gang:

Thank you for your question. At the beginning of the press conference, just now, Mr. Zeng has briefed us on the pandemic situation at home and abroad in recent times. You can also learn from various media outlets about the current pandemic situation. Generally, pandemic prevention and control efforts are still severely complex. Different countries have adopted varied prevention and control strategies and specific measures based on national willingness, social systems, economic development, public health resources and emergency response capabilities. You have just mentioned that some European and American countries, especially some countries where the pandemic situation is still serious, have loosened control measures for various reasons. At present, if the research on vaccines and specific drugs yields no results, the relaxed measures will increase the risk of a rebound in local cases and strengthen the complexity and duration of pandemic prevention and control. This will lead to greater challenges in prevention and control in our country.

Right now, our country has achieved periodic achievements and victories through prevention and control efforts. Our monitoring and early warning capabilities have been significantly improved, and our professional teams for disease prevention and control and medical treatment have been well-trained. We have accumulated effective experience in joint and group prevention and control, and the public's awareness and preventive capabilities have improved significantly. At the same time, with the implementation of regular pandemic prevention and control measures in China, we have determined that we will be able to manage the risks of a resurgence caused by imported cases.

Recently, secondary cases of imported cases have appeared in some parts of our country. This reminds us that, in the entire chain of enclosed management for prevention and control, if any link possesses weaknesses or blind areas, there will be a risk of disease transmission. In accordance with the decisions and arrangements of the CPC Central Committee and the State Council, all relevant departments are being integrated into the actual prevention and control work, carefully investigated hidden risks and further-improved prevention and control measures. We have implemented the enclosed management from the doorsteps of the country to the doorsteps of family homes. There are several primary measures that we have adopted. They are as follows:

First, we are strengthening joint prevention and control efforts. The National Health Commission and other departments, such as foreign affairs, customs, immigration inspection, civil aviation, and railways, have given full play to prevention and control efforts and further strengthened measures to prevent imported cases. For example, we have been insisting on a 14-day medical observation at quarantine sites for all people entering China, and we have been developing these measures.

Second, we are highlighting key links. We have implemented "four early measures," which are early detection, early reporting, early quarantine and early treatment. We have strengthened the monitoring of fever clinics and infectious disease reporting online, and we have implemented the enclosed management of "screening-diagnosis-reporting-quarantine". At the same time, we have further expanded the scale of testing. Just now, Mr. Zeng introduced the overall arrangement and measures for promotion.

Third, we are strengthening targeted control. According to laws and regulations, we have scientifically delimited the area of prevention and control. If instances of community spread or clustering cases occur, we will take the most effective measures as soon as possible, promptly deal with cases, identify the origin of infection and effectively cut off the transmission route.

Fourth, we are strictly implementing the responsibilities of local areas, departments, institutions, and individuals. We will strengthen the management and prevention in key regions, key institutions, key places, key populations, fully implement all measures and leave no stone unturned. At the same time, we also continue to widely promote scientific publicity and knowledge on prevention and control, actively guide the public in scientific prevention and control and jointly create a good environment for all members of society to participate in together. Thank you.

Hong Kong Economic Herald:

Since the outbreak of the pandemic, China has taken a series of effective medical treatment measures. Currently, as the pandemic continues to spread globally, are there any medical treatment experiences or achievements that can be shared? Thank you.

Zeng Yixin:

Ms. Guo will answer this question.

Guo Yanhong:

Thank you for the question. Regarding the medical treatment of COVID-19, we always stick to the goal of increasing hospital admission and recovery rates and lowering the rates of infections and fatalities. We also adhere to the principles of "early detection, reporting, isolation and treatment" and "pooling together patients, experts and resources for centralized treatment;" thereby improving the results of treatments. Our experience can be summarized in the following aspects:

First, we work to ensure early diagnosis and treatment. Pre-screening and separating patients are emphasized, and new fever clinics and observation wards have been set up to detect and isolate suspected cases in a timely manner. The diagnosis and treatment processes have been further standardized and optimized. We have also strengthened laboratory capacity and opened up qualified laboratories of medical institutions. At the same time, third-party testing institutions have been encouraged to provide testing services to maximize testing efficiency and ensure that cases can be detected, reported, isolated and treated at an early stage.

Second, medical resources have been expanded rapidly to ensure the admission and treatment of patients. Faced with a situation wherein cases increased rapidly, we expanded resources in the following three aspects in order to improve the admission and treatment of patients. First involved rapidly expanding hospital beds. Huoshenshan Hospital, Leishenshan Hospital and makeshift hospitals were built in a very short period of time. At the same time, some hospitals with a comprehensive capacity converted certain wards into intensive care units. In a short time, the number of beds in Wuhan, Hubei province, expanded to more than 41,000 beds, including more than 9,100 beds for critical cases. Second involved quickly bringing together health care workers. From the first batch of medical teams dispatched on New Year's Eve (January 24), the number of medical staff that went to support Wuhan mounted up to 42,000 in less than a month. Third involved quickly mobilizing medical materials and equipment, including protective supplies. By expanding resources in these three aspects, the patients were admitted and treated appropriately.

Third, diagnosis and treatment plans have been constantly optimized and improved. The diagnosis and treatment plans and guidelines are not only a summary of the new achievement of clinical research and practice, but also serve to guide medical treatment and improve the level of standardization of diagnosis and treatment. In this process, we have been constantly applying the results of clinical studies and technological innovations, selecting effective drugs and treatment methods and incorporating the diagnosis and treatment strategies of clinical practice into the protocols. We have updated the diagnosis and treatment plan to the 7th version, and this version has been translated into multiple languages to be shared across the world.

Fourth, we have pooled medical resources on treating critically ill patients. According to the principle of "pooling together patients, experts and resources for centralized treatment," we assigned the most professional medical staff to treat severe cases. In the treatment of these cases, we have combined preclinical medicine knowledge and clinical practice, frontline treatment experience and multidisciplinary studies, medical treatment and management as well as medical treatment and nursing — using a combination of traditional Chinese and Western medicine, in particular. When treating severe cases, we also emphasized admitting and treating mild cases to prevent their symptoms from progressing to severe. In this way, we increased the recovery rate and reduced the mortality rate.

Fifth, we strengthened management for the whole process of treatment. We set strict standards for discharging patients. After the discharge, a series of work procedures were also carried out, which included following up on the situation of patients, conducting psychological counseling and more; these procedures were performed in order to strengthen the overall management of patients and promote the full recovery of the patients both physically and mentally. Thank you.

Hu Kaihong:

Due to time constraints, we will only take two more questions.

Cover News:

With the normalization of pandemic prevention and control, the public is growing more concerned about the development of vaccine research. Can you give an overview of recent development? Thank you.

Zeng Yixin:

We are all very concerned about vaccines. Since the outbreak of the pandemic, under the joint prevention and control mechanism and led by the Ministry of Science and Technology, we have set up a scientific research team. Under this team, we have a special sub-team that is responsible for organizing, coordinating and serving all units to promote vaccine research and development. At present, overall development is going smoothly. We have made such progress largely thanks to our institutional advantages. We can fully integrate resources and coordinate advantages in all aspects. Medical institutions, for example, can obtain viral samples from infected cases, cooperation between medical institutions and scientific research institutions is enabled, and cooperation between scientific research institutions and enterprises is also possible. Government departments also play a vital role. The whole process of vaccine development must be strictly examined and approved by the National Medical Products Administration (NMPA), the National Institutes for Food and Drug Control, and the Center for Drug Evaluation under the NMPA. Therefore, it is very important to take joint actions with these government departments. The Ministry of Science and Technology has been supportive in project establishment and security of funding. With its timely help, we have made further progress in vaccine research. This fully reflects the institutional advantages of our country.

We now have one recombinant adenovirus vector vaccine and four inactivated vaccines, which have been approved successively by the NMPA. As the NMPA has innovated its emergency approval procedure, we have been able to carry out the clinical trials of phase I and phase II simultaneously. So far, 2,575 volunteers have been vaccinated. Phase I includes 539 volunteers, some of whom have provided preliminary safety and protective antibody data. The other 2,036 volunteers in phase II are participating in the whole process of vaccination and the evaluation of safety and effectiveness. Volunteers will take two or three injections during the entire process of vaccination. We have not received reports of major adverse reactions up to now, and if all goes well, we will complete the clinical trials of phase II in July as planned. 

In addition to the adenovirus vector, we have also pushed ahead with other technical routes of vaccine research and development in a smooth and orderly manner. Some of them have been adjusted quickly when they were found to have unsatisfactory effects, as the research on this vaccine is both a scientific exploration and a skilled technique. Those institutions that have made rapid progress have started to continually submit application materials, such as pharmaceutical research, preclinical research and clinical trial schemes to the Center for Drug Evaluation under the NMPA. It is expected that some projects will be approved by the NMPA from June and will then enter the clinical trial stage. This is the overall situation. Thank you.

Hu Kaihong:

The last question, please.

Economic Daily:

We know that the epidemic prevention and control steps have now become a regular practice, and the economic and social order is recovering. The public is very concerned about when hospitals could resume their normal diagnosis and treatment work. Can you share with us the details of this? Thank you.

Guo Yanhong:

Thank you for your question. Medical institutions undertake the dual tasks of epidemic prevention and control and providing normal medical services. As epidemic prevention and control has now become a regular practice, medical institutions should focus on the following aspects in order to provide normal services again:

The first is to fully implement the requirements of early detection, early reporting, early isolation, and early treatment, especially to ensure full promotion of the role of medical institutions in the detection of cases. Medical institutions should ensure they can provide timely detection, rapid treatment, accurate control and effective treatment. 

The second is to reinforce the infection prevention and control measures in a targeted manner. In particular, medical institutions must put in place adequate zoning management, environmental ventilation, disinfection and isolation, and make comprehensive investigation of infection risks. At the same time, it is necessary to improve escort and visit management, strengthen the scientific protection of medical personnel, and implement standard preventive measures.

The third is to innovate medical service methods. The medical institutions should fully implement appointment-based treatment, and treat patients in different time periods. They should provide one-stop services by optimizing processes to reduce staff gathering and infection risks. At the same time, we must also make full use of the Internet in medical treatment and promote integration of online and offline treatment.

People's demand for medical treatment is rigid. In order to meet their needs, consideration must be given to the regular practices required for epidemic prevention and control, and the service normalization. For now, all localities are working to resume the normal state of medical services in accordance with the deployment and requirements of the NHC. Our statistics have shown that the current overall situation of medical services nationwide has recovered to a level of 85% compared to the same period last year, and in some areas, the medical service has been completely restored. Thank you.

Hu Kaihong:

This concludes today's press conference. Thank you all.

.

Read in Chinese

Speaker:

Liu Aihua, director general of the Department of Comprehensive Statistics and spokesperson of the National Bureau of Statistics (NBS)

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

May 15, 2020

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office. Today, we have invited Liu Aihua, director general of the Department of Comprehensive Statistics and spokesperson of the National Bureau of Statistics (NBS), to brief you on the national economic performance in April. She will also take your questions. Now, I give the floor to Ms. Liu. 

Liu Aihua:

The country's economic performance continued to improve with major indicators manifesting positive changes in April. Under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the whole nation coordinated efforts to advance the work both of epidemic prevention and control and economic and social development. The positive momentum of domestic epidemic prevention and control was further consolidated and the resumption of work, production and market activities advanced steadily. Production demand improved gradually, basic industries provided strong support, and market expectations were generally stable. New driving forces appeared among the trends, and the economy showed more vitality. Major economic indicators show a sustained improving situation from March.

First, industrial production shifted from decline to growth and the growth rate of manufacturing rebounded noticeably. 

The total added value of industrial enterprises above designated size, which dropped 1.1% in March, grew 3.9% year on year in April, or up 2.27% month on month. In the first four months of this year, the total added value of industrial enterprises above designated size fell 4.9% year on year, which was 3.5 percentage points lower than the decline seen in the first quarter. An analysis by types of ownership showed that, in April, the added value of state holding enterprises went up by 0.5%; share-holding enterprises by 4.0%; enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan by 3.9%; and private enterprises by 7.0%. In sectoral terms, the added value of mining enterprises increased 0.3% year on year; that of manufacturing, which declined 1.8% in March, grew 5.0%; the production and supply of electricity, thermal power, gas and water grew 0.2%. High-tech manufacturing and equipment manufacturing witnessed fast growth. In April, the added value of high-tech manufacturing and equipment manufacturing grew 10.5% and 9.3% respectively, 6.6 percentage points and 5.4 percentage points respectively higher than industrial enterprises above designated size. Specifically, the production of cables, excavators and shoveling machinery, integrated circuits, industrial robots and micro-computers grew 43.8%, 40.8%, 29.2%, 26.6% and 26.2% respectively. 

Second, the decline of the service sector narrowed and the modern service industry showed good growth.

In April, the Index of Services Production dropped 4.5% year on year, 4.6 percentage points lower than in March. In the first four months, the Index of Services Production declined 9.9% year on year, 1.8 percentage points less than in the first quarter. Specifically, in April, information transmission, software and information technology services, financial services and real estate grew 5.2%, 4.4% and 1.1% year on year respectively; transportation, storage and post, wholesale and retail trades, and accommodation, restaurant and food service declined 5.0%, 6.6% and 33.7% respectively, which was actually a narrowing decline of 9.7 percentage points, 8.1 percentage points and 15.4 percentage points compared with that in March respectively. In the first quarter, business revenue of service enterprises above designated size dropped 11.5% year on year, of which that of information transmission, software and information technology services grew 4.0%. In April, the Business Activity Index for services was 52.1%, 0.3 percentage point higher than in March. Business activities for the majority of sectors were restored steadily. Among 21 sectors surveyed, there were 14 registering on the Business Activity Index at above 50.0%. The New Orders Index for services reached 51.9%, 2.6 percentage points higher than in March; the Business Activity Expectation Index stood at 59.2%, 2.4 percentage points higher than in March.

Third, market sales picked up and the proportion of online retail sales of physical goods continued to grow.

In April, the total retail sales of consumer goods reached 2.8178 trillion yuan ($396.84 billion), a year-on-year decline of 7.5%, which was 8.3 percentage points less than in March, or a month-on-month growth of 0.32%. In the first four months, the total retail sales of consumer goods reached 10.6758 trillion yuan, down 16.2% year on year, a narrower decline of 2.8 percentage points compared with the first quarter. Analyzed by different areas, in April, the retail sales in urban areas reached 2.4558 trillion yuan, down 7.5% year on year, and that in rural areas stood at 362 billion yuan, down 7.7%. Grouped by consumption patterns, the revenue of restaurant and food service was 230.7 billion yuan, down 31.1%; and the retail sales of goods were 2.5871 trillion yuan, down 4.6%. The retail sales of goods for basic living grew fast. Among the retail sales by businesses above designated size, that of grain, oil and food and that of beverages grew 18.2% and 12.9% respectively. Sales of upgraded consumer goods improved in April. Telecommunications equipment and cultural and office appliances rose 12.2% and 6.5% respectively, 5.7 percentage points and 0.4 percentage point respectively higher than in March. Online retail sales were active. National online retail sales in the first four months reached 3.0698 trillion yuan, up 1.7% year on year, while that in the first quarter dropped 0.8%. Of the total, the online retail sales of physical goods grew 8.6%, 2.7 percentage points higher than in the first quarter. And it accounted for 24.1% of the total retail sales of consumer goods, which was 0.5 percentage point higher than in the first quarter.

Fourth, investment in fixed assets improved and the decline of investment in high-tech industries narrowed significantly.

In the first four months, investment in fixed assets nationwide (excluding rural households) was 13.6824 trillion yuan, a year-on-year decline of 10.3%, which was narrowed by 5.8 percentage points compared with that in the first quarter; the month-on-month growth in April was 6.19%. Specifically, investment in infrastructure was down by 11.8% year on year, that in manufacturing fell by 18.8% and that in real estate development was down by 3.3%; however, these declines were narrowed by 7.9 percentage points, 6.4 percentage points and 4.4 percentage points respectively compared to the first quarter. The floor space of commercial buildings sold reached 339.73 million square meters, down by 19.3%, and the total sales of commercial buildings reached 3.1863 trillion yuan, down by 18.6%; these figures were 7.0 percentage points and 6.1 percentage points slower than the decline in the first quarter. Investment in the primary industry went down by 5.4% year on year; that in the secondary industry down by 16.0%; that in the tertiary industry fell by 7.8%. The decline was narrowed by 8.4 percentage points, 5.9 percentage points and 5.7 percentage points respectively compared with the fall in the first quarter. Investment in high-tech industries went down by 3.0%, 7.3 percentage points slower than the decline of the total investment and 9.1 percentage points slower than the decline seen in the first quarter, of which investment in high-tech manufacturing industries and high-tech service industries went down by 3.6% and 1.7% respectively. In terms of high-tech manufacturing, investment in manufacturing of computers and office devices grew by 15.4%. In terms of high-tech services, investment in services for commercialization of scientific and technological research findings, e-commerce services and professional technical services grew by 28.0%, 25.6% and 12.5% respectively. Investment in social sectors fell by 3.1%, which was 5.7 percentage points less than the decrease in the first quarter. Specifically, the year-on-year growth of investment in health sector and education sector shifted from negative to positive, standing at 4.7% and 2.9% respectively.

Fifth, the rise of consumer prices continued to fall and the decline of producer prices for industrial products expanded. 

In April, consumer prices went up by 3.3% year on year, 1.0 percentage point lower than that in March, or down by 0.9% month on month. For the first four months, consumer prices rose by 4.5% year on year. Grouped by commodity categories, in April, prices for food, tobacco and alcohol went up by 11.3% year on year; clothing went down by 0.4%; housing fell by 0.3%; articles and services for daily use rose by 0.1%; transport and communications were down by 4.9%; education, culture and recreation up by 2.0%; medical services and health care up by 2.2%; other articles and services up by 4.8%. Among the prices for food, tobacco and alcohol, prices for grain went up by 1.2% year on year, fresh vegetables fell by 3.7%, pork up by 96.9% and fresh fruits dropped by 10.5%. Core CPI excluding the price of food and energy went up by 1.1%, 0.1 percentage point lower than in March.

In April, producer prices for industrial products went down by 3.1% year on year, a decline expanded by 1.6 percentage points compared with that in March, or down by 1.3% month on month. Purchasing prices for industrial producers went down by 3.8% year on year, or down by 2.3% month on month. For the first four months, producer prices for industrial products and purchasing prices for industrial producers went down by 1.2% and 1.5% respectively year on year.

Sixth, the urban surveyed unemployment rate rose slightly and the employment for major labor force was generally stable. 

In the first four months, newly-increased employed people in urban areas numbered 3.54 million, 1.05 million less than in the same period last year. In April, the urban surveyed unemployment rate was 6.0%, 0.1 percentage point higher than in March, among which, the surveyed unemployment rate for population aged from 16 to 24, and from 25 to 59 was 13.8% and 5.5% respectively, 0.5 percentage point and 0.1 percentage point higher than in the previous month. The urban surveyed unemployment rate in 31 major cities was 5.8%, 0.1 percentage point higher than that in March. In April, the employees of enterprises on average worked 44.3 hours per week, 0.5 hour less than in March. 

Seventh, exports of goods witnessed a year-on-year growth and the trade structure continued to be optimized. 

In April, the total value of imports and exports of goods was 2.4966 trillion yuan, down by 0.7% year on year, 0.1 percentage point slower than the decline in March. Specifically, the total value of exports was 1.4074 trillion yuan, up by 8.2%, while that in March had been down by 3.5%; the total value of imports was 1.0892 trillion yuan, down by 10.2%. The trade balance was 318.1 billion yuan in surplus. In the first four months, the total value of imports and exports was 9.0713 trillion yuan, down by 4.9% year on year. Specifically, the value of exports was 4.7435 trillion yuan, down by 6.4%; the value of imports was 4.3278 trillion yuan, down by 3.2%. The trade structure continued to be optimized. In the first four months, the imports and exports of general trade accounted for 59.8% of the total value of imports and exports, 0.2 percentage point higher than in the same period last year. The imports and exports by private enterprises accounted for 43.2% of the total, 2.3 percentage points higher than in the same period last year.

Generally speaking, with main economic indicators improving in April, the national economy is gradually returning to normal. However, we should be aware that given the continuous spread of the pandemic abroad, the steady recovery of the domestic economy still faces multiple challenges. Under the complicated circumstances, we must coordinate efforts to advance both the prevention and control of the epidemic and the economic and social development under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. In the context of regular epidemic prevention and control, we must follow the general working guideline of making progress while maintaining stability, adhere to the new development philosophy, focus on the supply-side structural reform, make solid efforts to stabilize employment, finance, foreign trade, foreign investment, domestic investment, and market expectations, and comprehensively implement the tasks to safeguard residential employment, people's basic livelihood, market entities, food and energy security, the stability of industrial and supply chains and the operation at grassroots level. We must expand domestic demand, address difficulties facing enterprises, ensure economic fundamentals remained stable, facilitate stable and sound economic development, so as to ensure the victory of the fight against poverty and to build a moderately prosperous society in all respects.

Hu Kaihong:

Thank you, Ms. Liu. Now the floor is open for questions.

CCTV:

Good morning, Ms. Speaker. From the data you released just now, we can see the major economic indicators continued to improve in April. Is the recovery as expected? What's your overall opinion? Thank you.

Liu Aihua:

Thank you for your question. As is seen from the key data and the circumstances I just introduced, overall, the economy in April sustained the recovery and improvement first noticed in March, with major indicators showing positive changes. The main characteristics can be summed up in the following four aspects:

First, solid progress was made in the resumption of normal work and production. According to a quick survey by the National Bureau of Statistics in late April, approximately 85% of industrial enterprises above designated size, and over 70% of service enterprises above designated size, as well as more than 60% of qualified construction enterprises, resumed more than half their normal production level. Market expectations also show a month-on-month improvement. In April, the manufacturing purchasing managers' index (PMI) stood at 50.8%, which is within the "booming" range. The non-manufacturing business activity index registered 53.2%. The construction business activity index reached 59.7% and the service business activity index was 52.1%, both a slight rebound from March. This indicates enterprises expectations have improved month-on-month to some extent.

Second, production demand gradually improved. . The total added value of industrial enterprises above designated size grew by 3.9% year-on-year, shifting from a decline of 1.1% in March to a growth trend. From a sectoral perspective, the total added value in 28 of the 41 sectors recorded year-on-year growth and this is expanding. Regarding products, the total added value of 60% of 612 goods surveyed achieved year-on-year growth, 20 percentage points higher than the previous month. As far as related indicators are concerned, the industrial consumption of electricity in April grew 1.6% year-on-year, compared with a 2.8% decline in March. The decline also narrowed in the service sector. The service production index in April went down 4.5%, narrowing by 4.6 percentage points from March. Specifically, the decline in wholesale and retail trade as well as the transportation is narrower than the overall figure for the service sector. Investment activity is recovering. In the first four months of this year, investment in fixed assets registered a year-on-year decline of 10.3%, 5.8 percentage points narrowing compared to the figure in the first quarter. Specifically, the decline of investment in manufacturing, infrastructure and real estate narrowed at a rate between 4 and 8 percentage points. Market sales are improving, too. In April, the total retail sales of consumer goods fell by 7.5%, a decline narrowing by 8.3 percentage points compared with March. Among them, sales of upgraded consumer goods grew fast, especially telecommunication appliances, up by 12.2%. The total value of exports grew more than expected - up by 8.2% year on year.

Third, transformation and upgrading have continued. In the first four months of this year, new forms and models of online business continued to emerge. Online sales of physical goods during the first four months grew by 8.6%, which is 2.7 percentage points higher than in the first quarter, accounting for 24.1% of the total retail sales of consumer goods and a year-on-year rise of 5.5 percentage points. In terms of industries, the added value from high-tech manufacturing in April grew 10.5%, which was 1.6 percentage points higher than in March. High-tech products continued to maintain robust growth, with the production of cables, excavators and shoveling machinery for example increasing by more than 40% and industrial robots rising by 26.6%.

Fourth, employment and the price of commodities remained generally steady. In April, the unemployment rate in surveyed urban areas was 6.0%, which was 0.1 percentage points higher than in March, marking a slight month on month rise. In terms of unemployment figures, the rate of unemployed amongst those surveyed aged from 25 to 59 stood at 5.5%, 0.5 percentage points below the average unemployment rate. Regarding the price of commodities, prices continued to fall steadily. In April, the price of commodities increased by 3.3% year on year, which was 1 percentage point lower than in March. Food price in April saw an increase of 14.8% year on year, down 3.5 percentage points from March. The rise in prices of major agricultural products and byproducts including pork, fruit and fresh vegetables began to fall, with the decline expanding.

From the four aspects above, we can see that the national economy in April continued the momentum of recovery and improvements from March. Meanwhile, we can also see that these indicators were improving as a compensatory recovery. In terms of the performance of major indicators in the first four months of the year, the major indicators were still in decline. In the first four months, the total added value of industrial enterprises above designated size decreased by 4.9% year on year; the index of services production (ISP) declined by 9.9%; the investment in fixed assets decreased by 10.3%; the total retail sales of consumer goods went down by 16.2%; and the total value of imports and exports decreased 4.9%. These cumulative rates showed that the overall economy continued to decline, indicating that the overall economy has not yet returned to normal levels of previous years. Now that the epidemic is spreading overseas, its huge impact on the global economy is still evolving, which poses new challenges for steady economic recovery at home. Faced with such a complex situation, we have to consider the bottom-line when dealing with difficulties. We will continue to deepen counter-cyclical adjustments and carry out solid work to achieve stability in six key areas: employment, finance, foreign trade, foreign investment, domestic investment, and market expectations. We must also fully safeguard six key areas: jobs, people's basic livelihood, market entities, food and energy security, the stability of industrial and supply chains, as well as the smooth running of communities so as to accelerate the unleashing of potential in domestic demand and promote more bailouts for enterprises as well as maintain smooth circulation in industry, markets and the economy and bring economic development back to normal in all respects. This is my summary of the overall economic performance in April. Thank you.

China News Service:

Will the economic performance be stabilized in the current second quarter of this year despite continuation of the pandemic spreading in other countries, but with the prevention and control efforts expected to be normalized in China? Rebound in consumption and investment in April was modest, how would you forecast the economic trend in the ensuing phase? Thank you.

Liu Aihua:

Thank you for your questions. At present, the epidemic situation at home and abroad is relatively complex and grim, the future trend of the economy has concerned us a lot. Based on the data released over the past two months, I will explain my views on three points regarding the forthcoming economic performance.

First, we have shown we are capable of tiding over difficulties. The capability has come from our holistic industrial system developed over a long period, with a constantly-improving infrastructure and huge market. These advantages, which have not been seriously jeopardized or fundamentally changed, have played an essential role in supporting the economy. Over the past few months, when fighting against the pandemic, we have noted that all key industries critical to the national economy and people's livelihood have managed to maintain production which has ensured the rapid growth of medical supplies and the stable provision of daily necessities meeting the needs of 1.4 billion Chinese. More to the point, the trend of transformation and upgrading has been basically established. The major economic indices in April suggest that, despite the disruptions caused by the pandemic, industries that were emerging as new economic driving forces have kept on growing.  

Second, we are confident as we move forward. Our confidence develops from the coordinated prevention and control efforts as well as economic policies and measures that have proved effective. In March and April, the economy has shown signs of recovery, which itself shows the resilience of economic growth, giving us more confidence in hedging policies issued as macro-economic guidelines and expanding the resumption of normal work and production. From January to April, total planned investment in new projects have changed from negative to positive, rising 1.1% from a decline of 22% in the previous month, a turning point in terms of project reserves and capital support. Industrial electricity consumption achieved a positive rate in April. Based on the latest monitoring results in early May, growth in electricity consumption has continued to grow slightly. These indicators are evidence that there are conditions and a solid foundation for sustained economic recovery and improvement.

Third, we still face challenges. Because the pandemic has not been controlled effectively abroad, we remain uncertain of the impact of the epidemic on the global economy. Despite the strategic achievement made in preventing and controlling the virus at home, the momentum of recovery in the economic sector has yet to achieve a return to normalcy. Since the risks and challenges, such as the enormous employment pressure and the difficulties impeding the development of businesses and enterprises, remain huge, we should keep our bottom line thinking and enhance our awareness of risks. Therefore, we should promptly implement the existing macro-economic hedging policies, and on the other hand, make timely adjustments to our policies in response to changing situations and the demands of our enterprises, in order to help the economy return to normal. Thank you. 

New York Times:

The services number was not bad last month, but retail sales looked much weaker. If you take out groceries, they were quite weak. Are consumers in China becoming more cautious about making large value discretionary purchases? Thank you.

Liu Aihua:

Thanks for your question and for looking at the data carefully. Under current background of implementing regular epidemic prevention and control measures, we must view the economic situation under a bigger picture. The outbreak of COVID-19 has affected both production and consumption. At present, the recovery of production is slightly faster than that of consumption, which is related to the characteristics of the impact caused by the outbreak. Although the epidemic has now moved from a state of emergency to regular prevention and control, consumption and services based on gatherings and direct contact still need time to recover. The changes in the data also show that there is a gap between the recovery in the retail sales and that in the services sector. In April, the total retail sales of consumer goods declined 7.5% year on year, while the Index of Services Production dropped by 4.5% year on year. What's the difference between these two bits of data? The service industry is a multi-faceted industry, which includes not only direct contact and gatherings, but also services based on information technology. For example, some industries such as online education and telecommuting have benefited during the response to the outbreak of the epidemic. I think this can partly explain why the recovery in services sector is better than that in retail sales. That is the difference between the two indicators. Thank you.

CNR:

We noticed that in April, the total retail sales of consumer goods declined 7.5% year on year, down 8.3 percentage points from March, indicating that market sales are picking up. May I ask whether this recovery is sustainable? Given the continuous spread of the epidemic abroad, how will you further expand domestic demand in the next step? Thank you.

Liu Aihua:

Thanks for your question. In April, the total retail sales of consumer goods declined 7.5% year on year, a narrowing of 8.3 percentage points compared with March. Structurally speaking, the sale of goods for basic living grew fastest: grain, oil, food and beverages maintained double-digit growth. Second, sales of upgraded consumer goods maintained the momentum of accelerated growth. Meanwhile, sales of telecommunication equipment maintained double-digit growth, while the growth of cultural and office appliances also accelerated. Third, retail sales of some important items are actually recovering. For example, sales of automobiles were steady in April. The recovery of these goods with high proportion has helped the overall recovery of retail sales, and slowed down the decline.

For the next step, the momentum of current consumption upgrading will continue. The retail changes from month to month this year shows that the general trend has not changed. The retail sales of goods for basic living maintained steady growth, and that of upgraded consumer goods continued to grow rapidly. The industries and product sales once affected by the outbreak have shown momentum in their recovery under the current situation of epidemic prevention and control. Therefore, we think that the recovery of consumption still faces some challenges, and pressure still exists. However, in the short term, as the work and production gradually resume and the order of production and life gradually return to normal, the consumption environment will gradually improve. In the long run, there are conditions for the recovery of the consumption to be sustained. Thank you.

Economic Daily:

A continuous fall in the PPI shows although enterprises have now resumed work and production, there are still difficulties in restoring full capacity. Some have reported decreases in orders. Does this mean that China's industrial chains have not yet fully recovered from the impact of COVID-19? Also, how can our advantages in industrial chains be strengthened? Thank you.

Liu Aihua:

Thank you for your questions. In April, the PPI dropped 3.1% year on year, a larger decline than that in March. Structurally speaking, this decrease can largely be attributed to outside factors. Internationally, global crude oil prices fell sharply in April. The price of OPEC basket crude oil declined more than 70% in April compared to the high at the beginning of the year. As for other indicators, West Texas Intermediate crude oil futures dropped more than 40% in April compared with the previous month. The slump in the price of international crude oil has impacted prices in oil-related industries, thereby causing a drop in the PPI. At the same time, we should be aware of the decline in the demand in industrial markets. As I mentioned regarding restoring production capacity, nearly 85% of enterprises above designated size achieved 50% of their previous levels, which does indeed represent a certain gap from normal times. The construction and service sectors have shown similar features reaching even lower levels of production capacity. Changes in demand have influenced production to a certain extent. From the changing tendency of the PPI, on the one hand, we need to solidly promote the resumption of work, production and the markets, and release the huge potential in domestic demand. On the other hand, we must pay close attention to changes in the prices of major international commodities as well as the country's PPI. Generally, there is upward support for the PPI as order gradually returns to people's lives and production. 

Reuters:

Judging from the current trends, during which quarter do you expect the economy to come out of negative growth? Where should efforts be directed in expanding domestic demand? Investment or consumption? Thank you.

Liu Aihua:

Thank you for your questions. Your questions are focused on future trends. At present, on a monthly basis, industrial production achieved positive growth of 3.9% in April despite the gap from normal levels in former years and long-term trends. Other indicators such as investment, retail, exports and the service sector were all in a state of decline. In spite of the narrowed declines and positive growth in some indicators compared with the previous month, it is still a challenge to eliminate all the negative effects brought about by the epidemic during the early stages. It not only depends on the progress in domestic work resumption, but also the impact brought about by the international pandemic situation and external economic changes. Given the current situation, it remains to be seen how the economy will progress. However, as I said earlier, we have confidence, capacity and a solid base to maintain the momentum of restoration and improvement. 

Additionally, we will adhere to the strategy of expanding domestic demand amid the huge uncertainty of overseas demand. On one hand, we need to consolidate the basic function of consumption. On the other, we must strengthen the key role of investment. With regards to consumption, it is important to maintain growth in online consumption, whilst also recovering offline consumption. Key investment indicators have shown signs of recovery with many investment activities improving. Next, we will focus on strengthening public health governance capacity, upgrading industrial chains, consolidating the industrial development base, and fully allowing investment to play a key role. Thank you.

CNBC:

I have two questions. The first is about employment. What has the quality of employment been according to the current survey? The second question is about consumer spending. What is the current situation of consumer spending in first-tier cities?

Liu Aihua:

Let me answer your first question. As we mentioned, the surveyed urban unemployment rate shows small monthly changes, 6.2% in February, 5.9% in March, and 6.0% in April. The small fluctuations demonstrate overall stability. However, if we look at more indicators, there is still a large pressure on employment.

First, the scale of employment was lower compared with the same period last year. According to the statistics of the China's human resources and social security authorities, a total of 3.54 million new urban jobs were created in the first four months, a reduction of 1.05 million compared with the same period last year.

Second, the surveyed unemployment rate in urban areas was also higher compared with the same period last year. As mentioned, the figure for April was 6.0%, 1 percentage point higher than in the same period last year, indicating a large pressure on employment.

Third, there is a large pressure on employment for the major labor force. Take migrant workers as an example. We organized a quick survey at the end of April to determine the employment status of migrant workers. From what we learned, the employment of migrant workers improved to a certain extent after a series of measures to promote local employment. The number of migrant workers leaving home to work returned to about 90% of that in the previous year by the end of April, but there is still a gap from the normal level. As for college graduates, 8.74 million will enter the job market this year. So, there is a large pressure on employment for the major labor force.

This year, to show the great importance attached to employment, we put it at the top of the list of aspects to be stabilized and guaranteed. We adopted a series of targeted measures, under which some positive changes have taken place, although there is still a relatively high pressure on employment. Our quick survey showed that the rate of "unemployed on the job" in urban areas fell from 18.3% in March to 3.5%, reflecting an improvement in the quality and level of employment.

Your second question is about consumer spending in first-tier cities. I only have national data here. If you want to look at relevant data for a specific city, please contact the information department of the NBS, and we will provide you with an answer after the press conference. Thank you.

China Economic Information Service:

The turning point at the macro level during the second quarter is called the "second quarter phenomenon," but this year's situation may be slightly special. Judging from the trend so far, will there be a "second quarter phenomenon" this year? Thank you.

Liu Aihua:

Thanks for your question. It looks like everyone is concerned about the trend in the second quarter. I made some explanations based on the changes in indicators, the situation in China and overseas, and the overall context for next-stage development. I also introduced some of our views. On the one hand, we have the conditions, the foundation, and the confidence to achieve sustained economic recovery and growth under various policies and with market players' joint efforts; however, on the other hand, there are indeed large instabilities and uncertainties. Therefore, we must uphold bottom-line thinking, seize favorable conditions, use inherent strengths in economic operation, release the potential of domestic demand, and help companies overcome current difficulties. Eventually, the economy will return to normal.

Hu Kaihong:

The last question.

Hong Kong Economic Herald:

It is already May, and there is only one month left in the first half of this year. What do you think of the economic trend in the second half of this year? Exports account for a large proportion of China's GDP. Is there any hope for this year's GDP growth rate to maintain at least 6% as the pandemic continues spreading overseas? When will the global economy recover? Thank you.

Liu Aihua:

Thanks for your questions. The first question is about the future trend of the economy and the prospects for domestic economic growth, and you also touched upon changes in exports. There is indeed great instability and uncertainty in the prospects for exports. Many international agencies or organizations recently published forecasts for economic growth this year. The International Monetary Fund (IMF) forecasted that the world economy will decline by 3%, and the World Trade Organization (WTO) and the United Nations (UN) also made their predictions on global economic and trade activities. It is a large decrease. China's exports indeed face large risks and challenges as the risks of a global economic recession increase. Although the exports of goods increased by 8.2% in April, we cannot be overly optimistic about the prospects. Supported by a series of export stabilization policies, foreign trade companies have strengthened their adjustment capabilities, exerted their competitiveness, and diversified their arrangements, resulting in hard-won results. Despite this, it is difficult for China's exports to be spared from global economic contraction. Therefore, we should fully estimate the risks and challenges in this regard.

The second question is about predictions on economic growth for the whole year. I would like to highlight that we need to use our advantages, unleash our potential, actively respond to the current risks and challenges, help companies with current difficulties, and facilitate the Chinese economy to its normal track again. Thank you.

Hu Kaihong:

Today's press conference ends here. Thank you, Ms. Liu. Thank you all.

SCIO briefing on scientific research into COVID-19. [Photo by Jiao Fei/China SCIO]

Read in Chinese

Speakers:

Jin Qi, president of the Institute of Pathogen Biology, Chinese Academy of Medical Sciences;

Yan Jinghua, researcher at the Institute of Microbiology, the Chinese Academy of Sciences;

Wang Guiqiang, director of the Infectious Disease Department, Peking University First Hospital.

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office of China

Date:

April 27, 2020

Xi Yanchun:

Ladies and gentlemen, friends from the media, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Since the COVID-19 outbreak, Chinese scientific researchers and experts have been going all out to make scientific breakthroughs in the prevention and control of COVID-19. Today, we invited three scientists to meet with you and brief you on the scientific research into COVID-19. They are: Jin Qi, president of the Institute of Pathogen Biology at Chinese Academy of Medical Sciences; Yan Jinghua, researcher at the Institute of Microbiology at the Chinese Academy of Sciences; and Wang Guiqiang, director of the infectious disease department of Peking University First Hospital. They will first introduce themselves before taking your questions. 

Jin Qi:

Friends from the media, good afternoon. I am from the Chinese Academy of Medical Sciences, and my specialty is research into the pathogenic biology of infectious diseases. I'm very happy to have the opportunity to be here today and to speak with you, from a scientific point of view, on the issues that currently concern us. Thank you.

Yan Jinghua:

Friends from the media, good afternoon. My name is Yan Jinghua, and I'm from the Institute of Microbiology at the Chinese Academy of Sciences. My focus is vaccine development and therapeutic antibodies. I'm very happy to be able to speak with you this afternoon. Thank you.

Wang Guiqiang:

Good afternoon, friends from the media. My name is Wang Guiqiang, and I'm from the infectious disease department of Peking University First Hospital. I have 36 years of experience working in diagnosing and treating infectious diseases. I've worked on the frontline to guide the treatment of critical and severe cases, and have engaged in scientific research into medication. Thank you.

Xi Yanchun:

Have two of you been to Wuhan?

Jin Qi:

Yes, I was working in Wuhan from early February to early April.

Wang Guiqiang:

No, I went to Anhui province at the request of the National Health Commission to guide the treatment of critical and severe cases there.

Xi Yanchun:

Thank you for your hard work. Now, let's open the floor to questions. Please identify yourself before asking your questions. 

Sputnik:

How is the vaccine research progressing? What kind of technologies are being used? Is there any need to conduct collaboration? If so, which countries will China collaborate with? Will China cooperate with Russia on inactivated vaccine development? Which aspects will the cooperation cover? Thank you.

Wang Guiqiang:

Let me answer first and Professor Yan can add something. First, vaccines have attracted a lot of attention from the public. In terms of epidemic control and prevention, vaccines are an important element, so everyone is greatly interested. The Chinese government launched the vaccine R&D plan at the very outset. Currently, China has supported vaccine research in five routes, including adenovirus vector vaccine, inactivated vaccine, nucleic acid vaccine and others. They are all making progress now. We have noticed that the fastest one is the adenovirus vector vaccine developed by Academician Chen Wei as it was the first to enter phase-I clinical trials and has now entered the second round of clinical trials. The vaccines being developed by the China National Biotec Group and Sinovac Biotech are also under clinical research.

As for your second question, I'm not clear about the situation regarding cooperation with Russia, but the R&D of a vaccine is a big project and a COVID-19 vaccine has no successful precedent to follow, therefore, it's a systematic project. We are currently cooperating with the U.S., Germany, U.K. and some other countries. As for cooperation with Russia, Professor Yan will fill you in on that.

Generally speaking, vaccine R&D is a systematic project. We all anticipate it will be successful and contribute to the epidemic control and prevention. Thank you.

Yan Jinghua:

Let me add something. As a researcher into vaccine R&D, I'm currently very eager to cooperate with international counterparts as different labs and enterprises each have their own advantages. If we can combine those advantages together, the process will be accelerated and we can acquire a safe and effective vaccine much sooner. Thank you.

Bloomberg:

I have two questions. The first is about the asymptomatic carriers. Is there any update concerning the way asymptomatic cases spread or about their causes? Also, there are patients in many places who have developed symptoms after 14 days of isolation. Does this indicate that the incubation period of the novel coronavirus is longer than 14 days? Thank you.

Wang Guiqiang:

This is also a problem concerning epidemiology. First of all, there are indeed asymptomatic carriers both in China and the rest of the world. Currently, many of the imported cases in China are asymptomatic carriers. Statistics from the U.S. also show that random testing in the street has found many asymptomatic carriers. There are two groups of people among asymptomatic carriers. The first group are those who tested positive in the nucleic acid tests whilst still in incubation period, thus haven't yet developed any COVID-19 symptoms. As time goes by, some of them will develop symptoms. Therefore, these people are actually typical cases in incubation period, rather than asymptomatic carriers in a true sense. However, currently we are still not able to distinguish them, thus they are categorized as asymptomatic carriers.

The second group are asymptomatic carriers in a true sense. This is a common feature of epidemics. While the epidemic rages, many patients get the virus but develop no symptoms, which is called a subclinical infection. Thus, these patients don't go to hospitals for medical treatment, but when we take a look back at the end, we may find that these patients were indeed infected. These two groups are similar in terms of the physical performance. 

The main problem of an asymptomatic infected person is actually the problem of contagion. We believe that asymptomatic carriers are clearly infectious, and they should be treated equally with other COVID-19 patients. The infectivity during the incubation period is relatively stronger, and the viral load of asymptomatic carriers is generally lower. Still, this is only a relative number, and it cannot represent the relationship between infectivity and non-infectivity. Therefore, a part of asymptomatic carriers may appear as a latent infection, meaning they will become patients later. Thus, isolated observation is very important.

So far as the asymptomatic carriers can only be detected by means of testing, China has made it very clear that the role of large-scale nucleic acid testing should be much strengthened with the hope that those asymptomatic infections can be discovered as soon as possible. At present, we do routine screening for those who come back to China from outside the country, and it is precisely this routine screening that has found so many asymptomatic carriers. We also conduct general screening of the general population and high-risk groups, with the aim of finding asymptomatic infected persons, and then isolating and observing them in time to avoid further transmission. Thank you.

Jin Qi:

Professor Wang has made some very marvelous remarks while answering those questions. I would like to add a few of words concerning the onset of the disease after the 14-day quarantine. My general point of views consists of two aspects. First, the cases are quite rare, and, second, they are normal. Why should I hold such views? Because people differ greatly in routes of transmission and degrees when they have been infected by the disease. More to the point, for each individual, the infection routes, immune systems and body reactions are different. All those factors combined lead to a variety of incubation periods, say, one, three or ten days. It also leads to different symptoms, such as diarrhea or fevers, tested at 37, 37.5, 38 or 39 degrees Celsius. I see nothing unusual from this point of view that an incubation period can still run over 14 days, though, in accordance with the statistics and dynamic layouts, the occurrence is extremely rare. Therefore, a quarantine for a given incubation period of 14 days is completely rational. Thank you.

Lianhe Zaobao:

The scientific community has yet to come to a definitive conclusion on the origin of SARS-CoV-2. There have been allegations that the virus may be man-made. What is the possibility of that? We also want to know if Chinese scientists are still tracing "patient zero" and if there is any progress? Lastly, the COVID-19 epidemic was first detected in Wuhan at the end of December 2019, and the Chinese authorities have taken very proactive anti-epidemic measures since Jan. 20, 2020. Looking back, could Chinese experts have done a better job, between the end of December and Jan. 20? Thanks.

Xi Yanchun:

We have invited Dr. Liu Peipei of the National Institute for Viral Disease Control and Prevention of China CDC. He will answer some questions related to virus research.

Liu Peipei:

Your first question is about whether SARS-CoV-2 is man-made, which is a hot topic of concern. In fact, as some of you may have noticed, there is a general consensus in the scientific community that the probability is very low. A Lancet paper co-signed by scientists from various countries illustrates this. In a word, the possibility that SARS-CoV-2 was engineered is extremely low. The most probable possibility is that the virus was transmitted from a natural host to an intermediate host and then to humans.

The second question is about the tracing of "patient zero", which many countries around the world are actively working on. Of course, we are also pressing ahead with this. Tracing "patient zero" is an arduous task, involving intricate data. In addition, as the epidemic lingers, a seropositive background is present in the population, but it is difficult to specify when people became infected.

Just as Director Wang mentioned, at the early stage of the epidemic, many people who were very likely asymptomatic have no medical records, which increases the difficulty of finding "patient zero". These two aspects have thus added to the difficulty. We hope scientists worldwide can press ahead with tracing "patient zero", and work together to fight the epidemic.

Xi Yanchun:

The last question remains unanswered. Experts sitting on the podium may add a few words to answer that question.

Jin Qi:

Just now, Professor Liu made a very good point that after every epidemic, the scientific and medical communities, as well as the people and society, will be concerned about one word, that is: "patient zero". It is a question that we can't evade in terms of epidemiological investigation. As Professor Liu said, it is a very difficult question for science to answer. For example, has the "patient zero" of the 1918 Spanish Flu ever been found? As for AIDS, "patient zero" contact with the disease was conjectured to have occurred in 1930, but later, new evidence emerged and the disease was suspected to have originated from a hunter in 1920 in a certain country. But that's just speculation.

One could say, this is the story from 100 years ago, and hasn't there been a breakthrough in science and technology since then? Let me give another example. In 2009, the H1N1 virus originated in the Americas and evolved into a worldwide pandemic. Has "patient zero" of the 2009 H1N1 pandemic ever been found? The answer is no. We can see that it is a really difficult task. The difficulty lies in the fact it requires a considerable amount of work and interdisciplinary collaboration.

I'll give you a hypothetical example to help you understand it. If "patient zero" was asymptomatic or had mild symptoms then he or she may not have seen a doctor at all. In that case, how could we identify him as "patient zero"? Even if we suspected he was the "patient zero" then he would be likely to deny it since there are no medical records to reference. Some may ask, will the serological epidemiologic investigation help as we have well-kept medical records. But if both A and B test positive for IGg, how can we determine which one contracted the virus earlier without additional information? We can't. The task is tricky. The medical and scientific circles are looking for an answer. Chinese scientists are also working on that. This is the first aspect. 

Second, as to what Chinese scientists did at the beginning of the outbreak, I can give you an example. My institute worked on the task of identifying the pathogen in the early days. For an infectious disease, that is the first priority in prevention and control. It is extremely important because only after finding the pathogen can we decide on treatment and other response measures. Since we got the samples on Jan. 2, our scientists slept for only three to four hours each day for a week. At an advanced age, I was burned out staying there. My colleagues did their utmost, and we identified the pathogen within a week. Was it fast? I think so. Thus, we can see from this example that Chinese scientists did play a big role in dealing with the outbreak at the early stage and made key contributions. 

Of course, if we are faced with similar problems in the future, we will be even more hardworking. And as science and technology advance, I believe it will take even less time to identify such a pathogen. This time it took us a week, but next time it might be only three or four days, or even less than that. 

Wang Guiqiang:

First of all, everybody pays a lot of attention to "patient zero", and that is certainly important for tracing the origin of the disease, containing the pandemic and preventing the next possible epidemic. But China is not the only country with a "patient zero" — each and every nation has its own "patient zero", and all of them need to be traced. This is important. 

Second, for any disease, people's understanding develops day by day. People say this new coronavirus is very cunning, and that's true. As we do more research on it, we find that it is different from other viral infections. Other infections may take one or two weeks to cure, and they are self-limited diseases. But this new coronavirus has a long clinical course, and that is obviously different from other coronaviruses. Also, the rate of asymptomatic cases is quite high, which indicates that the virus does indeed have a cunning side to it while interacting with our bodies. Etiology is an important part of the development of a disease, and so is the human body's reaction. If the immune system recovers, then the virus will be contained easily; if it does not, then one can remain infected for days, and the virus can be spreading for days on end. Thus, our understanding of the disease is a gradually developing process. Chinese experts did a great amount of work at the outbreak's early stages, and their research gradually progressed from etiology to epidemiology and clinical manifestation. Thank you. 

Reuters: 

How many new coronavirus tests have been done in China? Do you think the growth rate of testing in China is adequate or not? Should China carry out mandatory testing? Thank you. 

Jin Qi:

Testing technology, along with the implementation of testing, is an important part of the overall prevention and control of the pandemic, and it is also an important part of our pandemic containment strategy. How many people need to be tested, and what kind of people need to be tested? I think it depends on the prevention and control measures in place at the given time. Currently, new indigenous cases come in single digits, and the outbreak has been generally contained. What are our prevention and control measures now? We are guarding against imported cases from abroad and preventing a resurgence of the outbreak at home. Based on that, the testing strategy is currently "letting those who need to be tested get tested." This focuses on the key sections of the population. Who are they? They include, for instance, those who are infected, close contacts who are symptomatic and asymptomatic, people who come from hard-hit regions, and people who manifest similar symptoms like fever, etc. Also, we must consider people in nursery homes, schools that are recently reopened and hospitals. There are a lot of in-patients in the hospitals. If one virus carrier visits the hospitals and gets others infected, that causes hospital-acquired infection. This is why these people are the key populations that need to be tested. 

In addition, as the resumption of work and production continues, we will also try our best, for the sake of safety, to meet the needs of coronavirus testing in densely populated areas. The current testing strategy, including for those priority groups, aims to help guard against imported COVID-19 cases and a rebound in domestic cases. This is also scientific in my opinion. 

Regarding your question about how many people have undergone coronavirus testing in China, the statistics should come from relevant departments. I'm a scientist, so I have no idea about the accurate number. Overall, our current testing strategy matches that of pandemic control and suits China's national conditions. Thank you. 

ITAR-TASS:

China now has a good bit of experience facing the pandemic. Many Russians wonder whether we should wear face masks or stay at home, and which major methods do Chinese experts think can be adopted for COVID-19 treatment? Thanks. 

Wang Guiqiang:

Thanks. I will take your questions first. It's very important to wear face masks. At first, there was some misunderstanding that wearing masks did not reduce the incidence of respiratory infections. However, China's experience has proven that wearing them is definitely effective. We knew that those asymptomatic carriers would be a key source of infection and lead to transmission of the virus if they didn't wear masks. There were many such cases in China at the very beginning. It is therefore crucial to wear a mask. Currently, China is taking regular pandemic prevention and control measures. Just as Mr. Jin mentioned, we are now working against imported COVID-19 cases and a rebound in domestic cases. Under current conditions, China has effectively controlled the outbreak. However, we still emphasize that people need to wear masks in public places. Unless in large squares or parks, you may be allowed to take off the masks, but you still have to wear masks at small-space gatherings. As previously mentioned, there are still some imported cases in China, and a very small number of individuals have even shown a relatively long incubation period of the virus. Hence, China still attaches importance to wearing masks, and so do other pandemic-affected areas, in particular. In this way, patients will prevent the transmission of the virus, and healthy people will protect themselves from being infected. The Chinese University of Hong Kong has carried out research on this aspect, and the results show that wearing a mask can effectively curb viral spread via droplets. Therefore, it's one of the most effective measures to prevent the spread of COVID-19. Of course, we also emphasize hand hygiene and ventilation, among other preventive measures, which are very important too. 

Your second question concerns China's treatment experience. It's true that since the outbreak began, we have launched plans for diagnosis and treatment and continually revised them. Within around two months, we have come up with seven versions of treatment plans. This timeliness shows that we are continuing to adjust with real-time diagnostic and treatment strategies, especially treatment plans, according to our latest evidence and experience. At the very beginning, we didn't know which drugs worked, so we looked at the treatment of SARS and MERS for reference, and we recommended some medications that were already on the market, including Kaletra, interferon and others. With the increasing data, more drugs were later included, such as chloroquine phosphate. And then came the use of more technologies, including stem cell therapy, convalescent plasma therapy and blood purification treatment. All of these are based on our continuous understanding of COVID-19. The mortality rate of the disease is relatively high among the elderly and those who have underlying health conditions, so we also put emphasis on effective strategies, such as oxygen therapy, standard ventilation treatment and multi-disciplinary cooperation. Chloroquine phosphate is a distinctive treatment method. Objectively speaking, we are still recommending the use of chloroquine phosphate. Base on the initial data ranging from the experience at the cellular level to preliminary clinical studies, we have seen the certain efficacy of chloroquine phosphate. The drug has been sold on the market for many years, and we are relatively confident in its safety. Of course, we should also pay attention to its side effects and make risk evaluations on the elderly and those who have underlying health conditions. However, considering that there are no specific drugs yet, it can be recommended for use. 

In addition, convalescent plasma therapy has shown clinical efficacy against COVID-19. We have collected plasma from almost a thousand convalescent COVID-19 patients and offered the therapy for more than 800 patients. It has proved effective. What's more, for the first time Chinese researchers have conducted clinical studies on the use of stem cell technology in the treatment of COVID-19 cases. More than 200 critically ill patients in Wuhan have received stem cell treatment, which has shown apparent efficacy. Now we are summarizing the results. These preliminary studies can serve as a reference for other countries. We still need to accumulate more evidence and more carefully analyze our previous studies. We hope we can publish these studies so as to provide more experience and references that other countries can use when diagnosing and treating COVID-19.

Yan Jinghua:

Convalescent plasma therapy, which Mr. Wang explained, has proved effective in China. There is actually another therapy, which has not yet been put into clinical use. You might have noticed that many international companies, such as Pfizer, are developing COVID-19 monoclonal antibodies, which, compared to plasma, are easier to produce and have clearer targets. Researchers of the Chinese Academy of Sciences are also carrying out similar studies. The results of animal testing have been positive, and the treatment has proved safe from a toxicological perspective. As a result, large companies worldwide will probably work on monoclonal antibody therapy. It provides a good direction for treating COVID-19 before we have a vaccine. Thank you.

Associated Press:

You've mentioned that China is cooperating with the U.S. and Germany to develop a vaccine. I heard that a German company called BioNTech is working together with a Chinese company, and the vaccine candidate is ready for human testing. Could you elaborate on their cooperation? What role does the Chinese side play? Will China join the Solidarity Trial launched by the WHO?

Yan Jinghua:

Drug development involves huge projects. Vaccines are broadly defined as drugs. The development of drugs and vaccines takes a lot of time and requires a massive investment. So usually good products are derived from cooperation among large companies. As you said just now, more and more international companies are cooperating on vaccine development. The cooperation you just mentioned is between two companies, BioNTech and China's Fosun Pharma. The future of their cooperation and the point at which clinical trials will be held depends on BioNTech's R&D progress.

As to the Solidarity Trial launched by the WHO, I think it's a very good idea. If realized, the initiative will strengthen our communication with other countries and help us greatly accelerate vaccine development. As researchers working on vaccine development, we hope international organizations, including the WHO, can maintain close communication and cooperation with each other, thereby improving global access to vaccines. Thank you.

The Asahi Shimbun:

There are many papers on the mutation of the virus. According to a paper that was published by an expert Chinese team, there are two subtypes of the virus. One is an older S subtype, and the other is an L subtype that is more infectious. Which one do you think is mutating? Is there any new mutation of the virus? Do you think the virus has the same virulence and is equally contagious in other countries? Thank you.

Liu Peipei:

Different research teams around the world have suggested various methods for typing and subtyping viruses, and the method of subtyping S and L is just one of them. Regarding this method, you will understand after you finish reading the paper, as the author has attached an explanation that has clearly explained there is no evidence about any direct relation between the virulence of the virus and these two subtypes.  

Jin Qi:

I would like to add something more in terms of the aspect that Dr. Liu has mentioned. If my memory serves me right, this paper was published at the very early stages of the COVID-19 outbreak. From a scientific perspective, having enough strains available is a prerequisite for any evolutionary analysis of the virus. However, that paper was published very early on, and researchers had only obtained 100 or 200 strains for the analysis. But up to now, how many strains are there in the public database? I believe the media must know well of the number. Moreover, given the same data, different statistical methods and algorithms will lead to different results, and this has been widely recognized in the field of evolutionary analysis. Consequently, different papers, in terms of their results or assumptions, can be explained from different perspectives. I, personally, believe that this paper currently shows some limitations in terms of the number of virus strains and locations affected by the virus, as the virus had just occurred in some regions at that moment. But now the pandemic has swept the world, including Europe and America, so you can get more strains at different times and from various locations, and the results will accordingly be more accurate. When we look at the paper right now, we may interpret it in a different way. I think that with the large increase in the number of virus strains in the public database, the results of papers published in the future will be more accurate and precise. Thank you.  

Wang Guiqiang:

I agree with Mr. Jin. First, the mutation of pathogenic microorganisms is a very normal phenomenon. After mutations, you need a lot of data to prove whether a strain variation can be defined as a subtype. Hepatitis B has different genotypes, as well as different subtypes, and there are basic definitions for them. I'm also aware of this paper. As to whether the mutations mentioned in the paper can be defined as subtypes, the author later corrected his conclusion and called them lineages — not subtypes. This is because to define a mutation as a subtype, you need to have a large number of virus strains to make comparisons and find out those variation sequences; then you can determine whether to call it a subtype or not.  

Second, these two lineages are not directly related to the virulence or the contagion of the virus, which was also pointed out by the author of the paper. Of course, we cannot rule out the possibility that some variations may become more contagious, which is possible, but we need more samples to prove that. Thank you. 

Yan Jinghua:

The relations between mutations and pathogenicity rate and contagion, from a biological perspective, must go through sequence analysis and bioinformatics analysis, and the final results must be verified from a biological perspective. For example, a mutation of a virus, according to epidemiology or animal models, does have increased infection or virulence. This is my point of view. Thank you.

CRNTT:

We noticed some experts, including WHO Director-General Dr. Tedros Adhanom Ghebreyesus, have pointed out that the novel coronavirus might be with us for a long time. Many people fear that the epidemic may easily re-ignite. It may retreat in summer and return in winter. What's your opinion on it? Is it possible for this to happen? If this is the case, how can people protect themselves from the virus? The SARS outbreak in 2003 dissipated as the weather warmed up. Will COVID-19 transmission also change with fluctuations in daily temperature? Thank you.

Wang Guiqiang:

Thank you for your question. This is a question that many people are concerned about. As you mentioned, SARS disappeared in a relatively short time and hasn't returned so far. However, the novel coronavirus is quite different from SARS and MERS. It can remain active for longer and has a higher ratio of asymptomatic infection. More importantly, although the novel coronavirus is sensitive to heat (and can be inactivated) at 56 degrees Celsius for 30 minutes, it is impossible for the weather to be that hot. Therefore, it is unlikely to see a significant decline in COVID-19 cases in summer around the world. 

As for whether the COVID-19 might be with us for a long time, we can't exclude such a possibility. It is possible for it to re-ignite in crowded and stuffy places in fall or winter. That's why we think it is crucial to take globalized prevention and control measures. Having put COVID-19 under control domestically, China is facing a surge of imported cases. The world is not safe even if there is one country incapable of curbing the spread of the virus. China has made a phased achievement with a huge expense. Looking at the trend of the COVID-19 pandemic, I hope the whole world can band together, follow WHO advice, and confront the global fight together. This is very important.

Jin Qi:

I want to share my thoughts on this as well. I have met many people with a "SARS mentality," which means they take it for granted that the novel coronavirus came without casting a shadow and will disappear without leaving a trace, just like SARS in 2003. In fact, the two are totally different. We have been trying to find out whether a virus can be harbored in a human body and cause chronic diseases or seasonal epidemics. Once a person was infected with SARS, he or she developed a fever. That's why we could curb the spread of SARS after we put all patients with a fever under control. The precondition was that SARS-infected patients displayed an obvious symptom—fever.

Now, the situation with the novel coronavirus is far more complex. We have seen asymptomatic infection, also called subclinical infection or inapparent infection. It is challenging to spot asymptomatic patients when they show no symptom of infection at all. So, can you expect such a virus to easily disappear from human society? Unlike SARS, it is somewhat likely for COVID-19 to co-exist with us for a long time and cause seasonal epidemics, just like other coronaviruses do. Thank you.

Xi Yanchun:

I think we are still making progress into the scientific research of the disease, and constantly deepening our understanding of it. I believe that as time goes by, we will develop an increasingly clearer picture of the virus.

NHK:

With regards to the origin of the virus, scientists believe that the novel coronavirus most probably originated in bats from Yunnan province. However, it seems unlikely that the bats flew to Wuhan over such a long distance. Therefore, there are suspicions that the virus could have leaked from the Wuhan Institute of Virology during research. As specialists, what is your take on this? Thank you. 

Xi Yanchun:

Another question about the origin of the virus. Let's hear from Dr. Liu Peipei once again, and then our specialists here could add something.

Liu Peipei:

With regards to these conspiracy theories, the scientific community has reached a basic consensus, which is, the possibility of the virus being man-made is very low. Scientists from multiple countries co-signed a statement published in The Lancet elaborating on that. I also notice that a recent report by the WHO responded again to the conspiracy theories. It is generally believed that the possibility of the virus being engineered or leaked from the laboratory is very, very low. Thank you.

Wang Guiqiang:

Thank you for your question. You mentioned just now that bats are highly likely to be the host of the virus. And bats are found flying in every part of the world. Nowadays, infectious diseases know no borders because of such well-developed transportation. The momentum of the fast global spread of infectious diseases has been extremely obvious. People have often spoke of the concept of the world being a "global village." Infectious diseases used to spread locally within specific regions, from specific ecological reservoirs to specific human populations. Now, with such convenient transportation, any infectious disease can spread around the globe in 24 hours.

So why is the world concerned about the prevention and control of infectious diseases? Because its epidemic status has changed. At present, global transportation has become convenient and advanced, meaning any infectious disease can quickly spread worldwide. Thus, as COVID-19 spiraled into a pandemic, it has become difficult to say where the etiology is, which requires a thorough tracing back to the origin. Thank you.

Jin Qi:

Relating this question to previous ones, all of them are asking about tracing the origin of the virus. Here I would like to share my opinion on this topic. Why do we need to trace to the origin? Or, what is the purpose of tracing the virus? From my point of view, one of the main purposes is to find out the source of the pathogen of COVID-19. What will we do after finding the origin? We can formulate targeted strategies for epidemic prevention and control, so as to prevent similar epidemics from harming human society. I think that is one of the main purposes in tracing the origin. However, virus origin tracing is a very difficult scientific issue, as I mentioned previously when answering the question about "patient zero." Have we finished the virus origin tracing for the 1918 influenza pandemic, or AIDS, or the H1N1 flu that broke out in 2009? Scientists all over the world are working on it, but I think it's a difficult problem. Some scientists have suggested it could take decades, even a century. Just now I mentioned the 1918 influenza pandemic, which was a hundred years ago; sometimes we may never get the result. However, we are still working on it, which is important. Therefore, with regards to this issue, Chinese scientists are doing the same thing as scientists all over the world, which is making all efforts to discover the answer. By integrating multiple disciplines, including computational biology, bioinformatics, epidemiology and molecular epidemiology, we can get some clues to interweave into a mutual support network. On the basis of this network, we may finally find the result we're looking for. Thank you.

Xi Yanchun:

I would also like to add that there is a consensus that we need to respect and believe in science. And I don't think it is a responsible attitude for a media outlet or relevant individual to make hasty judgments without any facts. We need to give scientists enough time and respect. I believe that they will help us know more about the virus and prevent and control it more effectively. This will be the last question due to time constraints. 

CGTN: 

What has struck experts like you most in your research since the outbreak of COVID-19? Many topics were mentioned just now, including the origin of the virus and how its pathogenicity was identified quickly at the early stage. What's your task or target in the future? Could you give us a list of priorities?

Xi Yanchun:

Let's invite each expert to have some words. 

Jin Qi:

I certainly have a lot of feelings that I'd like to share with you. At the beginning of February, we drove 16 hours from Beijing to Wuhan with a mobile negative pressure lab in preparation for a Fangcang shelter hospital. I came across no more than 10 automobiles while making the nearly 750-mile journey. This was a big shock to me. What's even more shocking was that when I arrived at the Fangcang shelter hospital, which was then the biggest one in Wuhan, I walked straight into the lobby — where no partition had been set up yet — only to find that it was packed with rows of beds without a single patient. I stood there for 20 minutes. It reminded me of a faded photo taken during the 1918 flu pandemic. Many of you may have seen it. I was deeply touched standing there. What moved me most was that we as human beings need to unite against the sudden outbreak of infectious diseases, and we have a lot to do. Thank you.

Yan Jinghua:

I have no experience like Mr. Jin's in Wuhan. I'd like to talk about my experience as a vaccine developer. We, as vaccine developers, have in fact been stressed and nervous since the outbreak of the new coronavirus. As you know, there are many infectious diseases, including HIV, Ebola and Zika. But we seldom find vaccines for them. No vaccine is available for MERS, and the same is true for HIV and Zika. No vaccine candidates for these diseases are available on the market. Since the outbreak of COVID-19, none of the new coronavirus vaccine candidates have gone to the market. So what's the effect of a vaccine? Will it protect people and eventually become available on the market? That's the biggest concern of every vaccine developer. Even now, it is unknown if the vaccine for COVID-19 will succeed. Hence, we have a lot of work to do. We need verification during the process. We want it to succeed. But science is science, and the pathogen has its own characteristics. We look forward to our success. Thank you.

Wang Guiqiang:

I have been involved from the start in the control and prevention of the COVID-19 pandemic, and I genuinely feel its impact on humans. At the time of the SARS outbreak, Beijing's streets were also empty. I believe the success of China's anti-epidemic work lies in top-down unity and concerted efforts. We should cherish our achievements. During the outbreak, the Chinese people have played important roles and made tremendous sacrifices, including our medical workers who braved the risk of infection to provide relief in Wuhan; our scientific and technological workers who worked round the clock on diagnostic reagents, pathogen screening and vaccine development; as well as ordinary people who stayed at home to contribute to the fight against the disease. It's safe to say that everyone is working together. Therefore, I think it is not easy for China to achieve such results. I also hope that the whole world can come together as one to fight the pandemic. It is far from being enough for a single country to work hard because COVID-19 is a global challenge, and we are a global family. All countries should unite to fight the disease so we can achieve victory together. Thank you.

Xi Yanchun:

OK, it is precisely one hour into the press conference. Three experts and Dr. Liu Peipei have responded to questions from ten reporters, and the exchanges were sufficient. In the future, we will create more opportunities to communicate with you. I want to say that in the face of the sudden outbreak, Chinese scientists and researchers have worked hard. They are dedicated, rigorous, and realistic. They have played a vital role in the prevention and control of the epidemic. I want to take this opportunity to salute and thank all scientists and researchers who are working hard on the frontlines in the field of scientific research on the epidemic prevention and control.

I also want to stress that the virus knows no borders. Solidarity and cooperation are the most powerful weapon for the international community to overcome the pandemic. China is willing to continue to work with the international community and provide Chinese wisdom and strength. Thanks again to the experts, and thank you all. Today's briefing ends now. Thank you.

Translated and edited by Wu Jin, Zhu Bochen, Li Huiru, Zhang Liying, Wang Yanfang, Gong Yingchun, Zhou Jing, Fan Junmei, Huang Shan, Li Xiao, Lin Liyao, Zhang Rui, Zhang Junmian, He Shan, Liu Qiang, Wang Qian, Wang Wei, Duan Yaying, Yang Xi, Zhang Lulu, Guo Xiaohong, Wang Yiming, Mi Xingang, Jay Birbeck, Laura Zheng, David Ball, Scott Rainen. In case of any dispute over a discrepancy, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Huang Libin, spokesperson of the Ministry of Industry and Information Technology (MIIT) and director general of MIIT's Performance Inspection and Coordination Bureau;

Wen Ku, MIIT spokesperson and director general of MIIT's Department of Information and Communications Technology Development.

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office

Date:

April 23, 2020

Xi Yanchun:

Ladies and gentlemen, friends from the media, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we are delighted to invite Mr. Huang Libin, spokesperson of the Ministry of Industry and Information Technology (MIIT) and director general of MIIT's Performance Inspection and Coordination Bureau; and Mr. Wen Ku, MIIT spokesperson and director general of MIIT's Department of Information and Communications Technology Development. They will introduce China's industrial and communications development in the first quarter of 2020, and also answer some of your questions.

First, I'll give the floor to Mr. Huang.

Huang Libin:

Ladies and gentlemen, friends from the media, good afternoon. First of all, thank you for your interest and support in the development of industry and communications. Next, I will brief you on the basic situation during the first quarter of 2020, and then my colleague Mr. Wen and I will answer some of your questions.

Since the beginning of this year, the unexpected outbreak of the COVID-19 epidemic has severely affected China's economic and social development. All sectors of society have been earnestly implementing the overall deployments made by the Central Committee of the Communist Party of China (CPC) and the State Council to coordinate the epidemic prevention and control work with economic and social development. Through hard work, China has achieved sustained improvements regarding the epidemic situation, and accelerated the restoration of economic and social orders. In the fields of industry and information technology, work and production have been resumed at an accelerated pace. The information and communications industrial sector has maintained overall stability.

First, the MIIT has ensured the supply of key materials in an orderly and vigorous manner. Since the start of the COVID-19 outbreak, the MIIT has been leading the State Council medical supplies group, and strengthening collaboration with other member units. Multiple measures have been taken to increase production and expand capacity concerning the efficient production and effective supply of key medical materials. During the peak period, the daily output of medical protective clothing exceeded 700,000 pieces, which was more than 50 times that during the early stage of the epidemic. The production of masks, medicine, infrared thermometers, ventilators and negative pressure ambulances has quickly increased, which has been indispensable in the domestic fight against the epidemic. Whilst working to meet domestic demand, the MIIT has also provided assistance within our capabilities to countries suffering from COVID-19. More efforts have been made to increase the supply of active pharmaceutical ingredients and anti-epidemic materials to the international market, so as to help prevent and control the pandemic globally.

Second, the MIIT has accelerated and further expanded work and production resumption. With a correct understanding of the relationship between epidemic control and production resumption, the MIIT has worked to promote the orderly resumption of work and production of the manufacturing industry through differentiated strategies and whole-industrial-chain coordination on the premise of strictly implementing COVID-19 control measures. Based on the concept of coordinated development between large and small companies, upper- and lower-stream enterprises, as well as domestic and foreign trade sectors, the MIIT has focused on key sectors, major industries and leading enterprises, highlighting the bottlenecks, difficulties and pains they have encountered in resuming work and production. More efforts have been made to conduct supervision and provide guidance accordingly. The MIIT has also introduced a series of policies and measures to further support medium, small, and micro enterprises (MSMEs). Through targeted coordination and assistance, the MIIT has been working to comprehensively help the manufacturing industry resume work and production. To date, industrial enterprises above designated size have basically resumed work and production. As of April 21, the average operating rate of enterprises and reinstatement rate of employees reached 99.1% and 95.1%, respectively, while the figures in Hubei province stood at 98.2% and 92.2%.

Third, economic performance has seen some positive changes. In order to cope with the economic impact of COVID-19, the CPC Central Committee and the State Council quickly proposed a series of counter-cyclical macro-policy adjustments, in order to ensure that economic fundamentals have remained steady. As these policies have gradually taken effect, major industrial indicators have improved significantly. In the first quarter of 2020, the added value of industrial enterprises above designated size dropped by 8.4% year-on-year. The figure in March dropped by 1.1%, the decrease of which narrowed by 12.4 percentage points compared with that of the previous two months. Investment in the manufacturing sector fell 25.2% year-on-year, the decrease of which narrowed by 6.3 percentage points compared with that of the previous two months. In March, the purchasing managers' index (PMI) for the manufacturing sector rose to 52% from 35.7% in February.

Fourth, the new economy and new momentum are growing against the trend. We strongly support 5G, artificial intelligence, Industrial Internet, Internet of Things, Internet of Vehicles, big data, blockchain, and other technological innovations and industrial applications; we accelerate the progress of 4G and 5G base stations construction. During the prevention and control of the epidemic, emerging demands, such as remote education, online medical service, and online video, have expanded rapidly, and internet applications have played an essential role in meeting people's everyday needs. In the first quarter, the added value from information transmission, software, and information technology services industries grew by 13.2% year-on-year; mobile internet traffic increased by another 39.3% on the basis of an increase of 129.1% in the same period last year. The national online retail sales of physical goods increased by 5.9%. In terms of industrial development, the output of integrated circuits, vending machines and ticketing machines, and electronic components increased by 16%, 35.3%, and 16.2%, respectively, in the first quarter. The value added from high-tech manufacturing in March increased by 8.9% year-on-year.

At present, China's domestic epidemic situation has been effectively controlled, and the orders of production and livelihood have been resumed in an accelerated way. However, the international epidemic is still expanding, the risk of a downturn of the world economy is increasing, unstable and uncertain factors have increased significantly, and the industrial economy is facing new difficulties and challenges. The situation is still not optimistic. From the perspective of long-term trends, we can see the impact and influence of the epidemic are staged and generally controllable and will not change the fundamentals of China's long-term economic growth. In the next step, in accordance with the overall arrangement of the CPC Central Committee and the State Council to coordinate epidemic prevention and control and economic and social development, our ministry will strengthen the "six stabilities," implement the "six guarantees", and comprehensively promote the manufacturing industry to resume work and production and reach its production goals, ensuring the stability of the supply chain and the industrial chain and promoting the stable and orderly development of the industrial economy in the normalized epidemic prevention and control.

I have finished my introduction. Now, Mr. Wen Ku and I will answer your questions.

Xi Yanchun:

Thank you, Mr. Huang Libin. Next, please ask your questions, and please identify your media outlet before asking questions.

CNR: 

I have two questions. First, we have noticed that the value added of industries above designated size in the first quarter fell by 8.4% year-on-year, and this was a significant decline. Will this trend continue? How do you view the trend of the industrial economy in the first half of this year and the whole year? Second, at a meeting yesterday, the Central Leading Group of COVID-19 Prevention and Control proposed a large-scale nucleic acid and antibody testing. Key populations will be tested, and large companies and organizations will be tested if they are willing. Can you tell us about the production and supply situations of our nucleic acid test kits? Thank you.

Huang Libin:

Thank you for your question. I will answer your first question first. I want to explore it from four aspects: the first is objective analysis, the second is a dialectical view, the third is to turn crises into opportunities, and the fourth is to maintain composure.

First of all, it is necessary to objectively analyze the impact and influence of the epidemic on economic operations, accurately assess its trends, and lay a good foundation for macro-control. Looking at the industrial economy in the first quarter, the added value of the nation's industries above designated size fell by 8.4% year-on-year, and for the first two months, it dropped by 13.5% year-on-year; the utilization rate of industrial capacity was only 67.3%, down 8.6 percentage points year-on-year; and the percentage of loss incurring China's enterprises reached 36.4%. The sudden outbreak of COVID-19 has had a huge impact on the operation of China's industrial economy. In accordance with the unified deployment of the CPC Central Committee and the State Council, on the premise of strict prevention and control of the epidemic, we orderly promote the coordinated resumption of work and production nationwide by region and by scale. The value added of industrial enterprises above designated size in March narrowed its decline to 1.1% year-on-year. PMI rebounded 16.3 percentage points from February. The flash report indicated that in the early and middle of April, the growth rate of electricity generation and consumption has changed from negative to positive, and the industrial economic operation is developing in a positive direction. The current global pandemic is spreading rapidly. Since mid-March, there are more and more canceled orders as well as cargo jettisons and rejections in foreign trade. As the order problems emerged, pressures on enterprise production and management have increased. Industrial economic operations still face significant challenges.

Second, by taking advantage of our industries, markets and institutions, we will respond precisely to the proactive changes in economic performance, securing stable expectations and boosting confidence. Generally, the impact of the epidemic, which is short-term and basically controllable, will not change the upward trend of our economy in the long run. However, its impact, resulting in a drop in supply and demand, and causing unsmooth internal and external business cycles, has affected our economy in the first quarter of this year. The driving force of consumption slackened as the national per capita consumption expenditure declined by 12.5% compared with last year after deducting price factors and the consumption of traditional bulk commodities, such as, vehicles and housing, dived. The launch of investments, with those in fixed assets sliding by 16.1% year on year, including a drop of 25.2% in the manufacturing industry, made it difficult to secure growth. Overseas demand dwindled greatly with export delivery value from industrial enterprises above designated size showing a year-on-year fall of 10.3%. The three demands, which slowed simultaneously, led the manufacturing industry to slump in the first three months. Nevertheless, with the successful containment of the epidemic and the resumption of economic and social normalcy in an orderly manner, proactive changes have emerged in the market. In March, investments into fixed assets and retail sales of consumer goods dropped by 8.8% and 15.8%, respectively, registering declines narrowed by 15.7 and 4.7 percentage points compared to the previous two months. Moreover, the decrease of added values of industrial enterprises above designated size narrowed by 12.4 percentage points. These changes mirror the resilience of our economy. With the implementation of a raft of policies and arrangements adopted by the CPC Central Committee in an effort to expand domestic demand, an increasing number of positive factors with consolidated market expectations and confidence will work together to improve the complete resumption of production, helping it fulfill the target output.

Third, while perceiving the opportunities and challenges brought forth by the pandemic in an objective and dialectical way, we should seize the opportunities of the crisis to develop and sustain the upward trend of the economy in the long run. With the global economy still being affected by the pandemic, the negative repercussions should be examined in terms of their extensiveness, sustainability and complexity in order to minimize the losses and impact that continue to affect China's economy. Therefore, we need to seize the window of opportunity by changing passive reactions into proactive ones, strengthening our areas of weakness, smoothing business cycles, and promoting industrial upgrading. Our holistic industrial chains should continue to play an increasingly important role in unclogging global supply chains, addressing underlying problems, undertaking productions of transferred overseas bills, and supplementing global supply scarcities. Considering the weaknesses exposed amid the pandemic, we should accelerate progress in core technologies from key industries, continue to upgrade fundamental industry capacities, promote industrial chains to pursue modernization and advancement, and ensure the safety of supply chains. With new forms of industry booming amid the pandemic, such as remote online diagnoses, office management, education and shopping, we will step up our efforts to support and direct them, awaiting full-fledged development, to become new backbones and driving forces that stimulate the economy to make further progress.

Fourth, with a resolution to defend the bottom line and maintain strategic focus, we should be capable of coping with the impact of the pandemic, preventing the short-term hit from developing into an unpredictable situation and maintaining stable fundamentals to confront challenges caused by external uncertainties. The Political Bureau of the CPC Central Committee convened on April 17, 2020, for a meeting on regular COVID-19 epidemic prevention and control measures and deployment of the current economic work. At the conference it was stressed that the country will "offset the impact of the pandemic with stronger macro policies" and "resolutely implement strategies to expand domestic demand." The Ministry of Industry and Information Technology (MIIT) will adhere to the deployment made by the CPC Central Committee and the State Council to strengthen our efforts to ensure stable performance in six key areas, namely, stability in employment, finance, foreign trade, foreign investment, domestic investment, and market expectations, and implement concrete measures to ensure employment for residents, basic wellbeing of the people, development of market entities, food and energy security, stable industrial and supply chains, and operation at the grassroots level. In doing so, we will continue with the complete resumption of work and production, fulfilling target output, and ensuring stable industrial and supply chains that allow the industrial economy to develop in an orderly manner. First, we will use all means to create an environment that is conducive to the resumption of work and production and the fulfillment of target output, and support economic recovery by ensuring smooth cycles of industrial and supply chains. Second, we will strengthen our areas of weakness, foster new driving forces to create high-quality supplies to lead and create new demands, and boost the high-quality development of the manufacturing industry. Third, we will ensure the implementation of policies and measures adopted consecutively to offset the pandemic's impact, precisely addressing the difficulties of micro, small and medium-sized enterprises to guarantee the stable fundamentals of economic development. Fourth, we will continue to deepen market-oriented reforms to improve the business environment, pursue high-level opening-up, lessen burdens on enterprises, and stimulate market vitality.

As for the second question, some 29 types of COVID-19 test kits produced by 25 companies have been approved to come to market. The daily production capacity is now 5 million. The Ministry of Industry and Information Technology (MIIT) is monitoring its production and supply every day. Based on current conditions, production is normal and inventory is sufficient. Thank you.

Phoenix TV:

During the pandemic, people have all stayed at home in quarantine and handled official business and classes online, which has contributed to the surge in network demand. What has the MIIT done to guarantee normal network operation under the high load? Thank you. 

Wen Ku:

Thank you for your question. For a long time, China's network infrastructure lagged far behind that of some developed countries. But during the pandemic, we've witnessed that China's network has undergone drastic changes. There are several signs. First, we have moved from the back of the pack to a leading position. By now, China has established the optical broadband network and 4G network with the largest scale in the world. Optical broadband users have accounted for more than 93% of broadband users, and the ratio of 4G users has reached 80%. Second, network use was formerly a luxury, but now it's a common commodity. As the quality and service level of telecommunication products continue to improve and charges decline, ordinary families now have access to the internet. During the pandemic, quarantine measures brought about the skyrocketing growth of network flow. The statistics showed that network flow during the pandemic increased by 50% compared with the end of last year. We did some statistical analysis in certain areas, and the growth rate in Wuhan during the same period reached 60-70%. Reports on some media outlets mentioned that some countries were not adapted to the high load and that skyrocketing household network use caused high-definition videos to degrade in quality. However, our online videos are all high-definition and can be broadcasted smoothly. I think the reporters here have experienced the quality. Yesterday, the China Academy of Information and Communications Technology released the "Suspending classes without stopping learning" network experience monitoring report. According to the report, the download speed of the national online education platform reached 97.7 Mbps, and that of the provincial platform reached 89.2 Mbps. Right now, 85% of online users have accesses to speeds of more than 100 Mbps on average. We are gradually promoting the piloting of 1,000 MB broadband, and there have been 1.61 million users. Rome was not built in one day. The information and communications industry has made long and painstaking efforts. Especially since the 18th CPC National Congress, we have accelerated our pace of catching up with advanced technology and made plans in advance, thus achieving our current accomplishments in dealing with the pandemic.

In summary, the achievement today is attributed to four aspects. First is the support of national policies. We've given full play to the guiding role of national development plans. We set goals based on policies, plans and standards, and we drove effective investment through policy guidance, creating a favorable policy environment. For example, we started the Broadband China Strategy in 2013 that for the first time listed broadband as a kind of new-era strategic public infrastructure along with traditional elements, including water, electricity and roads. Since 2015, we've increased network speed and lowered charges continuously, advanced the high-speed broadband construction represented by optical fibers and 4G, encouraged telecommunication corporations to cancel mobile phone domestic toll call roaming fees and internet usage roaming fees and lowered international toll call fees, offering cheap and effective network services for the general public.

At the same time, the 13th Five-Year Plan put forward the index of the internet availability rate. It was the first time for a national plan to utilize this as a clear index. Under this guidance, all the market entities gave full play to their roles and developed the industry rapidly. Right now, China has constructed high-quality integrated urban-rural network infrastructure, which has helped accelerate industrial development, technology innovation and service improvement. 

Secondly, we have made moderately advanced developments in network construction. Telecommunications technology follows its own law of evolution. We have experienced the changes of 2G, 3G to the present 5G, and from copper wire to optical fiber. We have also seen the development of more advanced network construction, and have established a principle of maintaining moderately advanced development in the process. Our motivation can be interpreted as: "we would rather build roads first, than vehicles first." Due to this, we shifted from copper wire to optical fiber in advance and issued national mandatory standards for the "Fiber to the Home" network. Developers of residential communities have been required to complete the construction of optical fiber connectivity. Full coverage of optical fiber-based broadband network has been realized in urban areas. The optical fiber network access ports accounted for 91%, all with access capability of 100 megabits per second and above. We have also launched a program to upgrade the speeds of both fixed and mobile networks to one gigabit per second, and published goals for the construction of cities with full optical fiber coverage and one gigabit per second access speed. Local governments were encouraged to participate proactively. Amid the epidemic, the development of the 5G network and the one gigabit per second network has enabled 5G network-based remote medical treatment and infrared temperature measurement, working online, and learning online. 

Thirdly, we have realized universal service of telecommunications, seeing the weakness of broadband network in remote areas. We have made great strides in telecommunications across the entire country. In the meantime, even though the operation of telecom industry observes market rules, remote rural areas are places where the market rules don't apply because the construction costs of telecom projects there can't be recovered as the profits are comparatively low. As of the end of 2014, a total of 50,000 administrative villages in China had no access to the broadband network, while 150,000 administrative villages had to endure network access capability of less than four megabits per second. The digital gap between urban and rural areas was obvious. Since then, we have launched six projects to pilot universal service of telecommunications. The general approach has been for the central government to channel funds, while local authorities provide coordination and support, and enterprises playing the major role of advancing development. The projects began at places where they were easier to carry out and then tapped into places with difficulties to make advancement. For example, expanding from administrative villages to human settlements with larger populations than others, and expanding from inland areas to border areas and islands. At present, 98% of administrative villages have been covered with optical fiber and 4G networks. Full coverage of 4G network has been realized across all inhabited islands and reefs in Sansha, the youngest city of our country, and 5G signals are now available at Yongxing Island and Yongshu Reef.

Fourthly, we have pushed forward with co-construction and sharing. As we encouraged telecom enterprises to compete with each other, we also pushed for China Telecom, China Mobile and China Unicom to cooperate in setting up a new company by integrating their communications towers. The result was China Tower. This move accelerated cost reduction and efficiency in the industry, and offered support for the fast and massive layout of the mobile network in the country. As of the end of 2019, the sharing rate of newly-built communications towers had increased to 80%, in comparison to 14% before the establishment of China Tower. This effectively made the competition in the industry more balanced, so now vast numbers of telecom users can fully enjoy the benefits of market competition. 

If not for the leapfrog development of network construction in recent years, people wouldn't have been able to live such rich lives during the epidemic; tens of millions of enterprises and government-affiliated institutions wouldn't have been able to handle businesses online with convenience; people wouldn't have been able to work at home via the internet without difficulty; and hundreds of millions of students wouldn't have been able to continue to attend classes online without encountering problems. 

Next, we will accelerate the construction of new infrastructure projects including the 5G network, a 1-gigabit per second optical fiber network and data centers, according to the arrangement of the central government. In particular, we will speed up the coverage of 5G in major cities and gradually extend the coverage to important counties and towns, with the aim of building an independent 5G network. Through these efforts, we will continue to improve the level of network construction in the country and provide a driving force to step up high-quality development. Thank you. 

Xi Yanchun: 

I would also like to echo Mr. Wen's words. Relying on the strong support of the highly stable 5G network, we successfully hosted press conferences in Wuhan via video links and hosted press conferences simultaneously held in Beijing and Wuhan, so we extend our gratitude to the Ministry of Industry and Information Technology. Please continue with questions. 

CNBC:

How did the new energy vehicles (NEVs) industry perform in the first quarter? And what are your expectations for the second quarter? Thank you!

Huang Libin:

Representing a significant pillar industry in China's national economy, the auto sector connects upstream and downstream industry chains and involves a wide range of sectors. The outbreak of COVID-19 has hit it severely. In the first quarter of this year, the output and sales volume stand at 3.474 million and 3.672 million, down 45.2% and 42.4% compared with a year earlier, respectively. Among them, sales of NEVs are hit heavier because the sector is still in the initial development stage. The output and sales volume of NEVs are 105,000 and 114,000, dropping 60.2% and 56.4% year-on-year respectively in the first quarter. Meanwhile, we should note that the output and sales volume dropped by 56.9% and 53.2% in March, respectively. The decline is narrowing compared with that in February, thanks to the effective pandemic prevention and control measures and the well-planned resumption of work and production.

Motivating consumer demand to spur auto sales is a fundamental policy in combating the impacts of the epidemic. In the early stage, the MIIT actively coordinated with relevant departments to develop policy proposals for stabilizing and expanding auto consumption, which were approved by the State Council executive meeting on March 31. These measures include: firstly, NEV purchase subsidy and vehicle purchase tax exemption policies will be extended for two years; secondly, the central government will replace subsidies with monetary rewards to support Beijing, Tianjin, Hebei and other key regions to phase out diesel trucks that only satisfy emission standards of China III and below; thirdly, the value-added tax on the sales of second-hand cars sold by second-hand car dealers is to be reduced to 0.5% of sales volume from May 1 this year to the end of 2023. Meanwhile, the MIIT encourages all localities to introduce measures to promote auto consumption market. Guangdong, Shandong, Jilin, Hainan, and Zhejiang provinces and Beijing, Shenzhen, Hangzhou, Ningbo, Nanchang, Guangzhou, Foshan, and other cities have officially issued specific measures. We believe more provinces and cities will follow suit. Auto output and sales volume will be restored and improved with the gradual release of consumption demand as well as the implementation of policies on expanding car spending.

In the next step, the MIIT will follow the arrangements made by the CPC Central Committee and the State Council in implementing related policies and measures and keeping a sustainable development of the automobile industry while ensuring powerful epidemic prevention and control, maintaining market order, and supporting work resumption. First, we will put into practice the requirements made at the State Council executive meeting to draft and issue specific policies and work to publicize notice and management of NEVs types and their subsidy and liquidation in coordination with the Ministry of Finance and other relevant ministries. Second, we will expedite the release of the New Energy Vehicle Industry Development Plan（2021-2035）and consolidate our efforts to achieve goals; meanwhile, we will work out a action plan on electrification of vehicles in public areas and give a boost to electrification level in buses, public sanitation patrol, post-delivery, taxies, commuting, light logistics distribution, and so on. Third, we will encourage the implementation of specific policies and measures to spur car sales in the related regions by offering electricity subsidies and convenient usage, as well as forming a complete vehicle set and expanding its application. Thank you!

National Business Daily:

We noticed that 5G has played an important role both in the epidemic prevention and control work and in the resumption of work and production. Can you explain the progress in promoting the 5G network?

Wen Ku:

Thank you for your question. We really value the development of 5G technology, and have been issuing 5G licenses since June 6, 2019. Three enterprises officially launched 5G networks on Oct. 31, 2019. Since then, 5G in China has grown rapidly. Generally speaking, although we have been impacted by the COVID-19 pandemic this year, the development of 5G has so far gone fairly smooth, and we have been making clear achievements for a while. As a matter of fact, 5G has now gradually permeated into people's everyday lives. 

First, we are "close to the network." Construction of the 5G network has been progressing rapidly. By the end of March, 198,000 5G base stations had been set-up across the country, and the number of 5G package users exceeded 50 million. We have observed from the network that currently over 20 million 5G devices have actually been connected to the 5G network. 

Second, we are "close to the products." The development of devices has entered a boom period, which is very good news for the people. By April 22, a total of 96 models of 5G cellphones have received the network permits. Compared to the number at the end of December last year, which was 39 models, this is a significant development. The price of 5G cellphones has also dropped quickly. Some 5G cellphones currently available on the market are priced at under 2,000 yuan. 5G business-use professional modules, telecommunication modules in cellphones, and modules on devices installed in industrial productions have also been introduced. They support various apps used on 5G 8K televisions, 5K industrial production lines, intelligent transportation systems and more. 

Third, we are "close to apps." Multiple applications have started to be launched. The apps installed in consumer spending areas, such as ultra high definition (UHD) videos, cloud games, AR and VR, are being implemented much more widely. 5G technologies have also been embedding deeper in key areas like car-networking, industrial internet and medical health areas on a trial basis. In particular, since the COVID-19 outbreak, the implantation of apps in 5G plus remote medical cares, intelligent medical treatment robots, sterilizing drones, online education, and home working has been accelerated. They have brought more visual 5G experiences for a vast number of customers.

At present, faced with the huge impact of the COVID-19 pandemic, 5G technologies, which have served as a key engine for the digital economy, are providing significant new infrastructures and assuring everything can be connected. They have played an important role in the aspects of stabilizing investment, stimulating consumer spending and helping in updating. Next, we will continue to speed up the construction and promotion of the 5G network, optimize the environment for innovation, and inject new energy into economic growth. We will conduct our work in the following aspects:

First, we will strengthen the basis and build a high quality network. To promote the development of the 5G network, the MIIT implemented the Notice for Accelerating 5G Network Development. According to this document, while assuring basic telecommunication enterprises market entities play their part and are secured by local governmental policies, we will push telecommunication enterprises to make use of these local policies. Many local governments have established special policies to speed up the development of 5G-related economies. We hope that enterprises will prioritize their construction in these areas with maximum support. In the meantime, these enterprises should launch the outbreak prevention and control work smoothly as a basis, and their resumption of work and production must be well conducted. During construction of the 5G network, a series of procedures will be carried out, such as designing, investigating and bidding. This requires enterprises to further optimize their working procedures, push working schedules and pool resources in order to accelerate the construction of the 5G network. We expect to accomplish this year's goals and hope that 500,000 new 5G base stations will be constructed. We also encourage both upstream and downstream businesses in the industrial chain to enhance cooperation, perfect their R&D and testing of 5G, and ensure the quality of 5G network constructions. We will also continue to perfect the equipment of independent networking modules and speed up the transition from dependent networking to independent networking.

Second, we will focus on innovation to unleash the potential of consumption. Manufacturers are encouraged to strengthen research, development and innovation, which will allow them to provide a variety of cost-effective 5G-supported smartphones to a huge number of costumers. Meanwhile, the telecommunication operators will take certain measures, such as gradually reducing internet charges and allowing purchases of handouts with credits, to boost consumption of 5G-based technologies. Additionally, we will bolster the integrated research and development of 5G modules and industrial terminals to promote the innovation and large-scale applications of ambient intelligence supported by 5G. We will stimulate the rapid growth of information consumption, seizing emerging opportunities with 5G applications such as online education, online medical care, and remote work, and enhancing the development of virtual and augmented realities plus 5G, livestreaming contests, games and entertainment, and virtual shopping. 

Third, we will address underlying problems, especially those of a general scope. 5G technologies are being applied not only to households but also to businesses and industries. For the use of 5G technologies in various industries, we will launch pilot programs to create virtual private networks through engineering-based approaches. Simultaneously, 5G network structure and its technological solutions will be made available and adaptable to the various demands of users from vertical industries, responding particularly to enterprises' concerns over localized data and independent network access control. The expansion and exploration of 5G technologies, from being applied to pure individual clients to covering both personal and corporate customers, will accelerate, and a consensus will be reached on standards, construction and business models concerning the application of 5G technologies across industries. Therefore, this development can be advanced from a nascent stage and put into real use. Thank you.

CCTV:

At the conference of the Standing Committee of the Political Bureau of the CPC Central Committee held on April 8, General Secretary Xi Jinping pointed out that we should take every possible opportunity to create conditions that support the resumption of work and production and seize every opportunity to enable smooth industrial, market, economic and social cycles. Then, what kind of work has the MIIT done to help resume the work and production of the holistic industrial chain?

Huang Libin:

General Secretary Xi Jinping has reiterated that industries should be coordinated in resuming work and production. The State Council's executive meetings on March 10 and 24 also focused on the resumption of work and production. Following the decisions and deployments made by the CPC Central Committee and the State Council, we promoted the industries' resumption of work and production under principles that included big enterprises taking a leading role in helping smaller ones, the coordination between upstream and downstream industries, and the cooperation between domestic and foreign trade firms. Our efforts can be elaborated in four aspects, as follows:

First, leadership is strengthened to cover all the horizontal and vertical industrial layouts. Led by Minister Miao Wei, a steering group consisting of 18 department directors has been established to focus on the resumption. Meanwhile, we have cooperated with 15 other ministries and commissions, including the National Development and Reform Commission, as a designated team to foster cross-departmental and cross-regional coordination. We have also sent teams to seven provinces, including Guangdong, Jiangsu, Shandong, Zhejiang, Fujian, Sichuan and Hunan to ensure that the resumption proceeds in an orderly fashion. Officials at provincial, autonomous regional and municipal levels have been sent to enterprises to help with their operation and assist employees to return to position, addressing the problems related to the labor force, logistics, funds, raw materials and parts supply.

Second, the leading enterprises take a leading role in the resumption, and the smaller ones follow suit. At the very beginning, we made a list of 51 leading conglomerates and more than 7,300 core supporting enterprises to address the blockages, difficulties and underlying problems encountered during the resumption of work and production. Local governments, departments and industrial guilds were also called on to provide targeted services. On such a basis, we then sorted out 41 other leading enterprises and 379 more core supporting partners and helped them to coordinate precisely with the resumption. The production of those enterprises has now been much restored when compared to the same period last year. The 92 leading enterprises combined have led more than 400,000 small and medium-sized companies from both upstream and downstream industries in making solid achievements during the resumption of work and production.

Third, we have made great efforts to aid, help and benefit enterprises by offering targeted services to small and medium-sized enterprises (SMEs) for their return to work and production. SMEs, with a large number of establishments covering a wide range of sectors, are an indispensable part of the manufacturing industry chain. The Ministry has given full play to the coordinating mechanism of the Leading Group Office for Promoting the Development of Small and Medium-sized Enterprises under the State Council, and has promoted the promulgation and implementation of a series of fiscal, tax and financial policies to support the production resumption of SMEs and to help them withstand difficulties. Through an online platform, online training and other ways, we have provided support for more than 200,000 SMEs and allowed them to enjoy these preferential policies. We have organized local governments to provide targeted docking services for SMEs in resuming their work and production through the opening of platforms that allow enterprises to connect supply and demand, as well as the launching of cloud services and resource matching meetings. We have also stepped up efforts to clean up the arrears that government departments and large state-owned enterprises owe to private enterprises and SMEs in order to prevent new arrears caused by the pandemic. In the first three months of this year, we have cleared up 28.8 billion yuan in arrears to private enterprises and SMEs.

Fourth, we have implemented policies and measures to help the manufacturing sector resume production, increase efficiency and achieve full capacity. In order to promote automobile consumption, an executive meeting of the State Council recently announced a two-year extension of the new energy vehicle purchase subsidy and purchase tax exemption policies, which were set to expire at the end of this year. The Ministry is working with relevant departments on detailed implementation plans. In light of the problem of poor offline sales in textiles and clothing, light industrial products, toys, furniture and other industries, we, along with several industry associations and e-commerce platforms, have held special online sales activities to promote consumption. To boost new drivers of the new economy, we have accelerated the construction of infrastructure, such as 5G networks, the Internet of Things, big data, artificial intelligence and smart cities, so as to promote the coordinated development of related industries in the upstream and downstream sectors. Thank you. 

Guangming Daily: 

Media reports say that the COVID-19 pandemic will accelerate the migration of China's manufacturing industry chain. How does the Ministry of Industry and Information Technology view this issue? A meeting of the Political Bureau of the CPC Central Committee mentioned the "six safeguards" (safeguarding jobs, livelihood, market entities, food and energy security, the stability of industrial and supply chains, and the smooth running of communities) for the first time. How do you plan to ensure the stability of industrial and supply chains? Thank you. 

Huang Libin: 

The outbreak of COVID-19, alongside the Lunar New Year holiday factor, has had serious impacts on people's lives and jobs, as well as on various sectors and industries. The manufacturing industry chain has been severely affected, the circulation of people and logistics are not smooth, and the upstream and downstream enterprises in the industrial chains are out of sync in production resumption. Apart from these prominent problems, factors such as stagnation in production of some important industrial products and obstruction of exports have also affected the international supply chain to some extent. In China, we see the continuous improvement of the pandemic prevention and control situation and the accelerated recovery of production and daily order. But the overseas pandemic situation has been accelerating and spreading. The manufacturing industries in countries and regions with serious pandemic conditions, such as the United States and European countries, have been shut down on large scales and production has been suspended, leading to serious breakups of the global supply chain. These situations force people to think about the safety of the industrial chain, and the globalization of labor division may face a new pattern adjustment.

At present, the global industrial chain layout and supply chain structure, formed as a result of the free flow of production factors in the most efficient way, in addition to the optimal allocation of resources over the decades, are rather stable and interdependent. For a long time, multinational companies have paid more attention to efficiency and costs when allocating production factors globally. Future adjustment is the choice of enterprises — not the will of the government. China is an indispensable and important pillar of the global industrial chain, and being "made in China" has its unique advantages. The super large market size is a decisive factor in ensuring the global industrial chain stays in China. The complete industrial system and well-developed infrastructure give us great confidence to further integrate into the global industrial chain. The pandemic could lead to a more diversified and resilient global industrial or supply chain, and we will retain foreign businesses in China with greater efficiency, higher-quality services and a better business environment.

China's economy is still growing on strong fundamentals and with unchanged overall competitiveness. Multinational companies still have confidence in the Chinese market, and their investment strategies remain unchanged. According to a survey released by the American Chamber of Commerce in China (AmCham) on March 25, 40% of AmCham members will maintain previously planned levels of investment, up by 17 percentage points from February. Tesla's gigafactory in Shanghai was built and started mass production in just under a year. In March, Tesla sold more than 10,000 vehicles in China, hitting a record high. An integrated global supply chain has proved to be more resilient and flexible than a fragmented one. Integration is more conducive to maintaining international security and stability, as well as ensuring and improving well-being for people around the world.

A meeting of the Political Bureau of the Communist Party of China (CPC) Central Committee held on April 17 emphasized efforts to maintain stability and the competitiveness of China's industrial and supply chains, as well as to promote coordinated work and the resumption of production across the industrial chain. In accordance with the decisions and plans made by the CPC Central Committee and the State Council, the MIIT will focus on the following priorities to ensure stability in industrial and supply chains.

First, we will keep connected with global industrial and supply chains, and contribute to international cooperation in fighting COVID-19. We will increase the supply of active pharmaceutical ingredients, life necessities and medical equipment, and ensure the production and exportation of key products and firms with major influence in the global industrial chain in an effort to keep the global supply chain stable.

Second, we will smooth domestic industrial and supply chains to stimulate the vitality of the domestic market. We will advance Internet Plus initiatives to boost traditional consumption and vigorously support the development of new forms and models. We will accelerate the construction of new infrastructure, speeding up the commencement of key projects in the industry and communications sectors and strictly ensuring the implementation of key foreign-funded projects.

Third, we will smooth out blocks in industrial and supply chains and promote the resumption of work and production in key sectors and areas. We will strengthen coordinated efforts and improve follow-up services. We will leverage the role of leading enterprises in driving the development of businesses in the upstream and downstream of industrial and supply chains. We will help large, medium-sized and small enterprises achieve integrated development, and we will work to stabilize the fundamentals of industrial operations.

Fourth, we will enhance capacity-building for the security of industrial and supply chains. We will make efforts to establish mechanisms operating across regions, departments and sectors in the aspects of information sharing, infrastructure connection, unimpeded logistics, financial integration, people-to-people ties and coordinated administration. We will also strengthen the risk-warning management of core sectors and key regions. Thank you.

Xi Yanchun:

I noticed that some reporters didn't get a chance to raise questions. For any inquiries, please feel free to contact the information office of the MIIT. Thanks again to the speakers and everyone else. Today's press conference is hereby concluded.

Translated and edited by Zhu Bochen, Li Xiao, Zhang Rui, Guo Xiaohong, Wu Jin, Wang Yanfang, Mi Xingang, Fan Junmei, Liu Sitong, Zhou Jing, Zhang Tingting, Li Huiru, Yan Xiaoqing, Wang Zhiyong, Zhang Junmian, Zhang Liying, Wang Wei, Jay Birbeck, Laura Zheng, David Ball, Scott Rainen. In case of any dispute over a discrepancy, the Chinese version is deemed to prevail.

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Read in Chinese 

Speakers:

Shen Changyu, director of the National Intellectual Property Administration

He Zhimin, vice director of the National Intellectual Property Administration

Yu Cike, director of the Copyright Administration under the Publicity Department of the CPC Central Committee

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office

Date:

April 23, 2020

Xi Yanchun:

Ladies and gentlemen, friends from the media, good morning. Welcome to this press conference. This week marks China's 2020 National Intellectual Property Publicity Week. Today, we are delighted to invite Mr. Shen Changyu, director of the National Intellectual Property Administration (NIPA) to brief you on the development of China's intellectual property rights (IPR) in 2019. He will also answer some of your questions.

Also present at the press conference today are Mr. He Zhimin, vice director of the NIPA, and Mr. Yu Cike, director of the Copyright Administration under the Publicity Department of the Communist Party of China (CPC) Central Committee.

Now, Mr. Shen will give us a brief introduction.

Shen Changyu:

Thank you, Ms. Xi. Friends from the media, good morning. Let me begin by thanking all of you for your concern and support of IPR-related work over the years. I would now like to brief you on China's IPR development in 2019.

IPR played a more prominent role in China's system for governance in 2019. General Secretary Xi Jinping gave a series of important new instructions on IPR-related work on several occasions, including at the 2nd Belt and Road Forum for International Cooperation and the 2nd China International Import Expo. He presided over the ninth meeting of the CPC Central Committee for deepening overall reform, which reviewed and approved "The Guideline on Strengthening Intellectual Property Rights Protection." The document was jointly issued by the General Offices of the CPC Central Committee and the State Council.

The fourth plenary session of the 19th CPC Central Committee made important new plans for appropriately strengthening the power of the CPC Central Committee in IPR protection, setting up a punitive damage compensation system for IP infringement and enhancing the protection of enterprise trade secrets. 

Premier Li Keqiang presided over a State Council executive meeting, making arrangements to improve IPR protection, promote intellectual property pledge financing and boost innovation and development of the real economy.

IPR is playing a more important role in modernizing China's system and capacity for governance. Fresh progress has been made in IPR-related work on various fronts.

First, efforts have been stepped up to transform China into a country that is strong on IPR. In accordance with the plans made by the CPC Central Committee and the State Council, we comprehensively started formulating an outline for building China into a country that is strong on IPR for the 2021 to 2035 period, and we have finished the first draft. We developed and implemented last year's plan on advancing national IPR strategy, and we acted on the plan for IPR protection and utilization in the 13th Five-year Plan Period (2016-2020). 

We continue to improve the quality and efficiency of patent and trademark examination. The period for examination of high-value patents has been reduced to 17.3 months, and the average time for trademark registration is 4.5 months. These numbers exceed the annual target set by the State Council. The cuts and exemptions in fees related to patents and trademarks amounted to 7.93 billion yuan. 

We accelerated the building of provinces, cities and enterprises that are strong on IPR. We selected another 18 demonstration cities, 88 pilot demonstration counties, 35 pilot demonstration parks and 2,239 demonstration enterprises. We have made steady progress in national copyright demonstration work and selected another two demonstration cities, eight demonstration parks (bases) and 69 demonstration work units.

Second, laws and regulations for IPR protection have been improved. An amendment to the Trademark Law was completed that increased the amount of statutory compensation for malicious infringements from less than three times the damage to less than five times. The compensation upper limit was raised from 3 million yuan to 5 million yuan. Revisions to the Law Against Unfair Competition was also completed, further strengthening the protection of trade secrets. 

Continued efforts were made to promote amendments to patent law and guidelines were provided for implementation of the Copyright Law as well as the Protection of New Varieties of Plants. The Regulation on the Management of Human Genetic Resources was also published. Multiple regulations and rules were formulated or revised regarding patent commissioning, patent agent examination, trademark application and registration and management of China offices of authentication institutions for foreign copyrights. The Guidelines on Anti-Monopoly Law Enforcement in the Field of Intellectual Property Rights was introduced, and research on the fundamental legal system for IPR protection was deepened.

Third, the protection of intellectual property rights (IPR) has been comprehensively strengthened. The General Office of the CPC Central Committee and the General Office of the State Council issued "Opinions on Strengthening the Protection of Intellectual Property Rights" and have put forth a series of notable policies and measures. The 2020-2021 Implementation Plan has been issued recently. The number of IPR protection centers and IPR rapid response centers has reached 46. We have launched targeted campaigns, such as "Iron Fist," "Sword Net," "Net Sword" and "Dragon Fly." A total of 32,000 trademark infringement cases and 7,000 cases of trademark counterfeiting were handled worth a total of 510 million yuan. 39,000 administrative cases for patent infringement disputes were handled. 10,000 cases of unfair competition were handled, with a value of 3.16 billion yuan. Public security authorities in China registered 24,000 criminal cases of IPR infringement as well as production and sale of counterfeit goods, with 16,000 cases solved and 29,000 criminal suspects arrested, involving 8.67 billion yuan. China's customs seized 51,000 batches of infringing goods. The people's courts in China registered 480,000 new IPR cases and closed 475,000 cases. The people's procuratorates in China approved the arrest of 7,430 people in 4,346 criminal cases of IPR infringement and charged 11,000 people involved in 5,433 cases. The level of social satisfaction with IPR protection in China increased to 78.98 points.

Fourth, the quality of intellectual property rights has improved steadily. There were 1.862 million invention patents from the Chinese mainland, 13.3 patents for every 10,000 people, achieving the goal set in the nation's 13th Five-Year Plan ahead of schedule. China's total number of effective registered trademarks reached 25.219 million, with every 4.9 market entities owning one registered trademark. A total of 2,385 products of geographical indication were approved, 5,324 geographical indication trademarks registered, and 8,484 enterprises with special marks of geographical indication products approved. Additionally, 8,319 layout designs of integrated circuit were registered. 2,288 new species of agricultural plants and 439 new species of forest plants were approved. Copyrights for 2.702 million pieces of works and 1.484 million pieces of computer software were registered. According to the World Intellectual Property Organization, China ranked 14th in the 2019 Global Innovation Index, moving up three spots from 2018 and ranking first among middle-income economies. In 2019, China filed 59,000 international patent applications via the Patent Cooperation Treaty (PCT), becoming the world's top patent filer. In 2019, China also filed 6,339 international trademark registration applications via the Madrid System, ranking third globally. 

Fifth, the effectiveness of IPR application has improved remarkably. A set of statistical categories for IPR (patent)-intensive industries has been released. According to the statistics, the added value of China's patent-intensive industries topped 10.7 trillion yuan in 2018, accounting for 11.6% of the country's GDP, becoming a key pillar of high-quality economic development. The added value of China's copyright industry reached 6.6 trillion yuan in 2018, accounting for 7.37% of the country's GDP. In 2019, with the implementation of the trademark and brand strategy, the shift from "Made in China" to "Brand in China" was accelerated and the application of geographical indications boosted targeted poverty alleviation and rural vitalization. The patent and trademark pledge financing reached 151.5 billion yuan, an increase of 23.8% from 2018. Copyrights worth 7.3 billion yuan were used as collaterals for financing, which helped nearly 10,000 enterprises solve financing problems. Technical contracts concerning IPR with a total value of 928.69 billion yuan were signed, up 137.7% year on year. The total trade of China's intellectual property royalties in 2019 reached $41 billion. The export volume of intellectual property royalties, in particular, stood at $6.6billion, up 18.8% year on year. 

Sixth, international cooperation on IPR protection has been strengthened. A number of IPR cooperation documents have been signed, such as the joint statement on the conclusion of the negotiations of an agreement between China and the European Union on cooperation on, and protection of, geographical indications and the agreement between China and France on cooperation on geographical indications. We have made solid progress in IPR cooperation under the Belt and Road Initiative, with eight cooperation programs yielding outstanding results. We have strengthened cooperation with the World Intellectual Property Organization and the World Trade Organization and actively participated in the global governance of IPR. We have made preparations for China's entry into the Hague Agreement Concerning the International Deposit of Industrial Designs. The Beijing Treaty on Audiovisual Performances will enter into force on April 28, 2020, as 31 eligible parties have deposited their instruments of ratification or accession. The Treaty is the first international agreement on IPR named after a Chinese city.

These are China's IPR developments in 2019. We would like to answer your questions. Thanks.

Xi Yanchun:

Thank you for Mr. Shen's introduction. Now it is time for questions. Please indicate the media organization you work for before raising a question.

CCTV:

We learned from General Secretary Xi Jinping's speech at the Belt and Road Forum for International Cooperation held last year that China would make more efforts to step up international cooperation in IP protection. What progress has the NIPA made in these aspects, especially in the Belt and Road cooperation on IP? Thank you.

Shen Changyu:

Thank you for your question. To implement the important instruction made by General Secretary Xi Jinping, the NIPA is actively advancing related work around the following aspects:

First, we are working to enhance multilateral cooperation and deepen ties with the World Intellectual Property Organization (WIPO) to take an active part in the global governance of IPR. We will steadily advance China's preparations for joining the Hague Agreement Concerning the International Deposit of Industrial Designs and work to bring into force the Beijing Treaty on Audiovisual Performances (BTAP), the first international treaty on IPR named after a Chinese city. Second, we will boost cooperation with our neighbors. We will actively participate in negotiations on the Regional Comprehensive Economic Partnership (RCEP) and the China-Japan-South Korea Free Trade Agreement, and we will promote mutual recognition and protection of geographical indication between China and Thailand. Third, we will strengthen small-scale multilateral cooperation. We will play an active role in IPR cooperation among China, the United States, Europe, Japan and South Korea, as well as among BRICS countries and among China, Mongolia and Russia. We will hold the Meeting of China-ASEAN Heads of Intellectual Property Offices. Fourth, we will enhance bilateral cooperation to complete the negotiations on the agreement of China-Europe geographical indications protection, concerning a mutual recognition and protection of 275 total products of geographical indications from each side, respectively. We will promote bilateral cooperation with the European Patent Office and the European Union Intellectual Property Office, as well as the IP authorities of Britain, France and Germany. Generally speaking, we will accelerate building a new pattern of linked and coordinated international cooperation on IPR.

In terms of international IP cooperation, the cooperation among the Belt and Road countries is a top priority. We have worked with relevant parties to map out eight practical cooperation projects covering IP protection, review services, development of foundational capabilities and the improvement of public awareness of IPR. These projects have now come through with significant achievements. The number of patent and trademark applications between the Belt and Road cooperation partners and China has maintained rapid growth. Last year, the number of patent applications from those countries increased by 9.7% in China, while that of patent applications China filed in those countries went up 8.5%. The deepening cooperation has been a forceful driver of the Belt and Road's development.

Next, the NIPA will make greater efforts to step up international cooperation on IP protection to promote common development. Thank you.

Beijing Daily: 

The BTAP is an international treaty on IP named after a Chinese city. There were reports that the treaty would take effect by April 28. Could you share with us some details about the treaty? What has the National Copyright Administration of China (NCAC) done? Thank you.

Yu Cike:

Thanks for your question. The BTAP is an international copyright treaty administered by the WIPO. It aims to protect the spiritual and economic rights to their recorded or unrecorded performances that performers enjoy.

From June 20-26, 2012, the WIPO held a diplomatic conference on the protection of audiovisual performances, which ended with them entering into the BTAP. On Jan. 28, 2020, Indonesia submitted its instrument of ratification to the WIPO, becoming the 30th key member of the treaty. According to the BTAP's operative clauses, the treaty will take effect three months after the date on which 30 eligible parties have deposited its instrument of ratification or accession. Hence, the BTAP is scheduled to take effect going forward from April 28, 2020. 

The conclusion and entry into force of the Beijing Treaty on Audiovisual Performances will comprehensively improve the level of protection offered to performers by the international community, and promote the development of the audiovisual industry. The positive effects of the Beijing Treaty are as follows: First, it will fully protect the rights of audiovisual performers, further improve their industrial status and stimulate their enthusiasm for creativity; second, it will enrich spiritual and cultural products, and promote the healthy development of the audiovisual industry; third, it is conducive to the protection of traditional culture, and folk literature and art, and will promote the development of cultural diversity.

Mr. Francis Gurry, director general of the WIPO, explained that the Beijing Treaty strengthens the rights of audiovisual performers, which can be translated into income growth, and will promote the economic sustainability of the audiovisual industry that brings pleasure to all of us.

The Beijing Treaty is the first international intellectual property treaty concluded in China and named after a Chinese city since the founding of New China. The National Copyright Administration has carried out a series of fruitful tasks in promoting the conclusion and entry into force of the Beijing Treaty.

In 2012, the National Copyright Administration and the Beijing Municipal People's Government jointly organized the "Diplomatic Conference on the Protection of Audiovisual Performances," with the approval of the CPC Central Committee. During the meeting, the Chinese government pushed for the successful conclusion of the Beijing Treaty through mediation, negotiation and coordination, which was highly appreciated by Mr. Francis Gurry. He believes that this diplomatic conference embodies the "Beijing Spirit" featuring understanding, support, inclusiveness and cooperation, which will continue to promote international intellectual property cooperation.

On April 24, 2014, the eighth meeting of the Standing Committee of the 12th National People's Congress approved the Beijing Treaty. On July 10 of the same year, Mr. Cai Fuchao, then-director of the National Copyright Administration, submitted a government statement on ratification of the Beijing Treaty to the WIPO on behalf of the Chinese government.

After the conclusion of the Beijing Treaty, the National Copyright Administration actively promoted its early entry into force. The National Copyright Administration and the WIPO have hosted multiple international copyright forums to discuss the protection of performers' rights and reach a consensus. The National Copyright Administration has also actively engaged in bilateral cooperation on copyright, and carried out exchanges into strengthening the protection of performers' rights. In addition, the National Copyright Administration, alongside WIPO officials, met with ambassadors of relevant countries in China to accelerate the process of the treaty's ratification; and worked with agencies of the Beijing municipal government to hold commemorative activities or seminars on the conclusion of the treaty and the copyright protection of audiovisual performances.

The Beijing Treaty is a milestone in China's copyright cause and a new starting point for benefitting global performers. China will continue to cooperate with the WIPO, actively promote more countries to ratify and join the Beijing Treaty, and solidly implement the protection of performers' rights. China will also take the treaty's entry into force as an opportunity to continuously improve the copyright protection system, further enhance the protection of performers, and promote the high-quality development of the copyright industry, including audiovisual performances. Thank you.

Economic Daily:

We have noticed that China recently published data on the added-value of patent-intensive industries. What are the main areas covered by these industries? As for the development of related industries, in what areas is China lagging behind developed economies such as Europe and the U.S.? Thank you.

Shen Changyu:

Thank you for your question and interest. As I just mentioned, not long ago, the National Intellectual Property Administration and the National Bureau of Statistics jointly released data on the added-value of national patent-intensive industries. The data showed that the added-value of China's patent-intensive industries was 10.7 trillion yuan in 2018, accounting for 11.6% of GDP. These industries contributed 15.7% to GDP growth, thereby bolstering high-quality economic development.

The term "patent-intensive industries" refers to a collection of sectors in which the intensity and scale of invention patents meet prescribed standards, rely a lot on intellectual property rights in market competition, and pursue innovation development. Examples include information and communications, new equipment manufacturing, new materials, medicine and medical care and environmental protection sectors, which all reflect the new progress in improving economic structure and transforming growth drivers, as well as the new outcomes in innovation-driven development.

In recent years, developed economies, such as Europe and the U.S., have also paid increasingly more attention to patent-intensive industries and have carried out regular statistical research and published the data. For example, according to the latest report released by the EU in 2019, the share of its patent-intensive industries in GDP already reached 16.1%, 4.5 percentage points higher than China's 11.6%.

However, China is expected to see its patent-intensive industries maintaining stable growth while playing a greater role in transforming the pattern of economic growth and developing the real economy in the future. Thank you.

CRI:

In recent years, reforms to streamline administration, delegate powers, improve regulation, and upgrade services continued in the field of intellectual property rights, and reforms to facilitate trademark registration also intensified, delivering continuous benefits. How effective are the trademark registration facilitation reforms in promoting innovation and entrepreneurship? What are the future steps? Thank you.

Shen Changyu:

Let's invite Mr. He to answer your question.

He Zhimin:

Thanks for your questions. In recent years, the National Intellectual Property Administration has been prioritizing the reforms to streamline administration, delegate powers, improve regulation and upgrade services, and it has also been facilitating intellectual property services. We released implementation opinions on deepening the reforms in the field of intellectual property and creating a good business environment, with 78 specific measures proposed in 14 aspects to realize more convenient applications, more efficient review, fuller use, stronger protection and better service. At present, we are actively building an intellectual property big data center and public service platform to offer multiple services at one stop. As for the reforms to facilitate trademark registration, we have done a lot for a better and quicker trademark review, and we have made great progress.

First, we shortened the average review period of trademark registration to four and a half months, a level that is close to the world's fastest under the same system. The review period of trademark change, transfer, and international registration under the Madrid System has also been reduced. The review period for dismissed cases is now reduced from 12 months to seven months, and for complex cases, it has been reduced to 10 months.

Second, we are facilitating trademark services. Applicants can handle major trademark-related business that includes registration, change, transfer and international registration under the Madrid System both online and offline. Last year, the online application rate reached 94.5%; among the 212 trademark service windows nationwide, 103 can handle trademark pledge financing. We helped companies raise about 41.1 billion yuan last year, effectively addressing their financing difficulties.

Third, we made trademark review procedures more open and transparent, published trademark review and adjudication documents, conducted review hearings orally and on circuit and disclosed information on all of the more than 40 million trademarks. We have actively accepted societal supervision while offering better services.

Fourth, we carried out vigorous actions in the Trademark Review Quality Improvement Year, and strictly combated trademark hoarding and malicious registration. From April 2019 to the end of the year, 39,000 applications for abnormal trademarks were rejected during the review stage alone.

In addition, we also improved the quality and efficiency of patent review. By the end of March this year, the average review period for invention patents had been cut to 20.5 months, and the review period for high-value patents had been reduced to 16.6 months.

This year, we will further promote reforms to facilitate trademark registration and streamline procedures by improving online trademark services. At the same time, we will further improve review and adjudication standards, continue to curb the hoarding and malicious registration of trademarks that are not for use purposes, regulate trademark agency and promote high-quality trademark review and adjudication. Thank you.

Macau Monthly:

The World Intellectual Property Organization (WIPO) held another video conference on April 20 to discuss interim policies and remedies on intellectual property rights (IPR) for the international community during the outbreak of the pandemic. As the director of China National Intellectual Property Administration (CNIPA), Mr. Shen attended and spoke at the meeting. Could you give us a brief introduction about how China plans to handle problems related to the delay and extension of application time limits for the Patent Cooperation Treaty (PCT)? Thank you.

Shen Changyu:

Thanks for this good question. As COVID-19 has spread across the world, it has brought challenges to the operation of the WIPO, intellectual property authorities across the world, and the WIPO's PCT and other global IPR service systems. On April 6 and April 20, WIPO Director General Francis Gurry called together the heads of intellectual property authorities in 16 countries and regions to discuss how to deal with the impact of the pandemic. On April 9, WIPO issued the Interpretative statement and Recommended Patent Cooperation Treaty (PCT) Practice Changes in light of the COVID-19 Pandemic. The statement wrote that "the current global pandemic should be considered to be a 'natural calamity'" and it "will treat favorably any PCT Rule 82quater request made citing COVID-19 related issues and not require evidence to be provided that the virus affected the locality in which the interested party resides."

As you just mentioned, I attended the two conferences on behalf of the CNIPA, and I expressed China's support for the WIPO to play an active coordinating role during the pandemic so as to unite intellectual property authorities in the world to fight the crisis together and effectively protect the rights and interests of all applicants and rights holders.

Next, the CNIPA will follow the WIPO's interpretative statement and recommended practice changes to properly cope with problems related to the delay and extension of application time limits of the PCT. In the meantime, we will continue to support the WIPO to play an active role by strengthening information communication with intellectual property authorities in various countries and regions so as to jointly respond to the challenges COVID-19 poses to the international IPR system. Thank you.

China Daily:

We all know that the Outline of National Intellectual Property Strategy, which was released in 2008, will expire this year. Have the major goals set for 2020 been realized as scheduled? You just mentioned that you are working hard to formulate the Outline of National Intellectual Property Strategy for 2035. Is there any progress in this work? And what are your next steps? Thank you.

Shen Changyu:

Thanks for your questions. Since the Outline of the National Intellectual Property Strategy was issued in 2008, especially after the 18th CPC National Congress, under the strong leadership of the CPC Central Committee and the State Council, China's IPR work has achieved great results. The goal of "building China into a country with a comparatively high level in terms of the creation, utilization, protection and management of IPRs by 2020," which was set out in the 2008 Outline, has been basically achieved, as is shown in the following aspects:

First, the quantity of IPR creation has increased substantially, making China a major IPR country. From 2007 to 2019, the number of valid invention patents in the Chinese mainland increased from 84,000 to 1.862 million, and the number of valid registered trademarks increased from 2.353 million to 25.219 million. The number of IPR types concerning copyrights, new plant varieties, geographical indications and layout designs of integrated circuits has also increased notably. The number of core patents, famous brands, copyrights of high-quality IP contents and fine new plant varieties has continued to increase.

Second, remarkable results have been achieved in IPR application, effectively promoting economic and social development. As I just mentioned, in 2018, the added value of the patent intensive industry in China reached 10.7 trillion yuan (US$1.51 trillion), accounting for 11.6% of the national GDP. In 2019, China's box office sales reached 64.3 billion yuan (US$9.09 billion), nearly 20 times that of 2007. The total import and export volume of IPR royalties increased nearly fivefold from US$8.5 billion in 2007 to US$41 billion in 2019.

Third, the protection of intellectual property rights (IPR) has been strengthened, and the business environment has been improved. We have established fully-fledged intellectual property laws that are consistent with international norms, and administrative and judicial protections has been improved. The overall score of social satisfaction with intellectual property protection in China reached 78.98 points.

Fourth, public awareness of intellectual property rights has been significantly improved. Public awareness of IPR strategy has seen a remarkably improved rate increase from 3.7% in 2008 to 86.3% in 2017. More and more people are getting used to innovative development, brand consumption, and paying for knowledge. Moreover, the public has realized that it is important to show respect to knowledge and innovation, practice honesty and abide by the law.

Fifth, we have expanded and deepened international cooperation on intellectual property rights, and our international influence in terms of IP protection has been improved significantly. Currently, China has been working with more than 80 countries, regions and international organizations around the globe to protect IPR. It has become an important participant in international rule-making and global governance of intellectual property rights. More and more Chinese enterprises have improved their intellectual property applications overseas. China's number of Patent Cooperation Treaty (PCT) international patent applications topped the world list last year. As I've mentioned just now, the number of applications for international trademarks via the Madrid system ranked third in the world last year.

All these achievements have laid a solid foundation for us to build China into an intellectual property rights powerhouse. To ensure the continuity of the implementation of the Outline of National Intellectual Property Strategy issued in 2008, and following the deployment of the State Council, we are working hard to formulate another outline designed to help China grow into an IP powerhouse by 2035. This is of great significance to better promote the implementation of the two-step approach adopted at the 19th National Congress of the CPC to build China into a strong and modern socialist country by the middle of the century. The National Intellectual Property Administration has been engaging in this assignment since last year. The first draft of the outline has been finished after going through a series of research, study, expert consultation and international comparison and opinions have been preliminarily solicited within a certain scope. Next, we will improve and modify the draft, which is scheduled to be submitted for further review in the second half of this year. Thank you. 

Xinhua News Agency:

The theme of this year's National IP Publicity Week is "IP and a healthy China." What measures can be adopted to build a healthy China in the area of intellectual property rights? Thank you.

Shen Changyu:

Thanks for your question, and also thanks for your attention and support for the campaign. The theme of this year's campaign is "IP and a healthy China," a theme with special significance that was decided based on the current situation of pandemic prevention and control, as well as the theme of the World IP Day 2020 — "Innovate for a Green Future." The theme also shows the important impacts that the protection of IP has on public health. Our work will be carried out in the following aspects: First, we will strengthen IP protection to boost innovative development in the medical sector, develop more new drugs and sophisticated medical devices  and improve the ability and level of treatment. In this regard, we are accelerating amendments to the patent law, and we are establishing a compensation system for the duration of drug patent protection. Second, we will better protect Traditional Chinese Medicine (TCM) to leverage its unique role in medical treatment and disease prevention and control. We have been enhancing the protection of TCM patents and also cooperating with relevant authorities to roll out regulations to protect TCM knowledge. Third, we will boost the geographical indications industry, cultivate more plant species and create more famous brands to ensure food safety. Fourth, we will step up efforts to protect trademarks, copyrights and special symbols to boost cultural and sports industries and enrich people's spiritual and cultural lives. Regarding the IP of the Beijing 2022 Winter Olympics and Paralympic Winter Games, we have achieved all-around, comprehensive protection for the relevant patents, trademarks and special symbols. Fifth, we will protect human genetic resources to build a special shield for people's health. The State Council issued a regulation last year on the management of human genetic resources that went into great detail on the protection of said resources. We will step up efforts to protect IP in terms of the above-mentioned aspects to ensure the development of a healthy China. Thank you. 

Insight China magazine, Chinaxiaokang.com:

The IP operation system is an important guarantee supporting IP utilization. What new progress was made in building China's IP operation system in 2019? The year 2020 will see the completion of the building of a moderately prosperous society in all respects. Does the NIPA have any plans for the next step? Thank you.

Shen Changyu:

Thank you for your questions. As you just said, IP operation is an important part of our IP-related work, which includes IP creation, protection, utilization, management and services. We often say that creation is the source, utilization is the goal, protection is the core, and management is the key. IP utilization mainly aims to realize the value of IP and promote innovative economic development. Statistics show that China's comprehensive IP development index continues to improve, and IP utilization has achieved remarkable progress. 

In 2019, patents were transferred, granted and pledged all over China a combined 307,000 times, up 21.3% compared with the previous year. The pledge financing of patents and trademarks amounted to 151.5 billion yuan, up 23.8% year on year. The turnover of all technology contracts involving IP reached 928.69 billion yuan, up 137.7% year on year. We also accelerated the construction of a group of projects and platforms for IP operation. By the end of 2019, a total of 26 cities had been given priority to building a service system for IP operation. The nine national-level platforms for IP operation housed 121,000 IP registrations, and the number of registered users reached 284,000. Therefore, we have achieved new progress in building the IP operation system.

Next, we will continue to focus on these major cities and promote the common development of operation platforms and pilot projects. We will improve the IP operation system, and promote the realization of the IP value so that it can better support economic and social development. Thank you.

China News Service: 

Mr. Shen mentioned several times just now that China ranked first globally for PCT international patent applications in 2019. My questions are: How will the NIPA consolidate and maintain the No.1 position in the future? And how will we strengthen IP protection overseas? Thank you.

Shen Changyu:

Thank you for your interest. Last year, China filed the highest number of PCT international patent applications, which also aroused worldwide attention. This was the first time that China ranked first. According to the WIPO's annual report released on April 7, China filed a total of 58,990 international patent applications under the PCT System in 2019, ranking top in the world. We attribute this achievement to the country's guidelines on implementing its innovation-driven development strategy and IP strategy. The whole society's innovation capacity and awareness of IP protection continue to improve, and enterprises are also attaching more importance to their IPRs overseas.

China has been a member state of the PCT since 1994, and is also a major participant in the PCT. In the future, China will continue to promote innovative development, expand its opening-up, and further implement relevant programs to improve the quality of patents. 

You also asked how we will help enterprises with IP protection overseas. To this end, we will encourage them to develop global patents portfolio, make further improvements in their PCT international patent applications in terms of both quantity and quality, and promote worldwide innovative development. In order to help enterprises safeguard their rights, we have also established the National Guidance Center for Handling Overseas Intellectual Property Disputes. The center offers guidance to Chinese enterprises on resolving overseas IP disputes. Of course, it also helps them to better understand local IP laws and regulations, and carry out relevant overseas work involving IP.

Xi Yanchun:

Today's press conference is hereby concluded. Thanks again to the speakers, and thank you all. 

Translated and edited by Liu Qiang, Zhou Jing, Duan Yaying, Li Huiru, He Shan, Huang Shan, Wang Wei, Zhang Jiaqi, Wang Qian, Yang Xi, Gong Yingchun, Lin Liyao, Zhang Junmian, Laura Zheng, David Ball, Scott Rainen. In case of any dispute over a discrepancy, the Chinese version is deemed to prevail.

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Read in Chinese

Speakers:

Huang Hong, vice chairman of the China Banking and Insurance Regulatory Commission (CBIRC);

Cao Yu, vice chairman of the CBIRC;

Xiao Yuanqi, chief risk officer and spokesperson of the CBIRC.

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office of China

Date:

April 22, 2020

Xi Yanchun:

Ladies and gentlemen, friends from the media, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Huang Hong, vice chairman of the CBIRC, Cao Yu, vice chairman of the CBIRC and Xiao Yuanqi, chief risk officer and spokesperson of the CBIRC. They will brief you about the operations and performance of the banking and insurance sectors in the first quarter. They will also answer your questions. 

First, I will give the floor to Mr. Huang.

Huang Hong:

Friends from the media, good morning. First, I will brief you on the prevention and control of the pandemic situation within banking and insurance institutions. As of yesterday, a total of 1,065 people in banking and insurance institutions nationwide had a confirmed COVID-19 infection, including 933 people in Hubei province, and a total of 1016 people have recovered, including 887 in Hubei. 42 people have died, including 41 in Hubei. Some family members of employees of banking and insurance institutions have died from COVID-19. We mourn the loss of them and we will work harder and provide better service to the public to commemorate their death. Currently, seven employees of the banking and insurance institutions are still being treated in the hospital and 8 people are asymptomatic cases, including six in Hubei. One of them has recovered. Up to now, except for Hubei, the resumption rate of banking and insurance institutions across the country is at about 97%, and the resumption rate of banking and insurance branches has reached 99%. More than 60% of banking and insurance institutions, and 90% of banking and insurance branches in Hubei, have resumed work. The resumption rate of banking and insurance institutions and branches in Wuhan have steadily increased, and basic financial services are guaranteed.

Currently, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the progress in prevention and control of the COVID-19 epidemic in China has been further enhanced, and economic and social operations have gradually returned to normal. The CBIRC has resolutely implemented the decisions and deployments of the CPC Central Committee and the State Council. In accordance with the requirements of "maintaining stability in six key areas, namely with respect to employment, finance, foreign trade, foreign investment, domestic investment and expectation" and "ensuring the employment of residents, the basic livelihood of the people, the support for market entities, the security of food and energy, the stability of the supply chain and industrial chain and the operation at grassroots level," we have successively issued many policies and measures to increase financial support for pandemic prevention and control as well as economic and social development. We have been working to facilitate the resumption of work, production, business and the market. We have focused on preventing and defusing financial risks while also ensuring the stable operation of the banking and insurance sector.

First, all-out efforts have been made to provide financial services for pandemic prevention and control. By reducing the deposit reserve ratio, relending and rediscounting, banking institutions have effectively reached out to enterprises that manufacture and transport important medical supplies and daily necessities, providing preferential interest rates and special credit quotas for them. Insurance institutions have set up fast tracks for customers who have been affected by the epidemic to settle claims, appropriately expand the scope of insurance compensation liability and strive to provide insurance for all the insurable and settle the claims that should be settled.

Second, we will provide liquidity support for enterprises in a timely manner and help small and medium-sized enterprises (SMEs) surmount their difficulties. We have increased support for SMEs in terms of credit: inclusive loans for SMEs have increased by 25.93% year-on-year at the end of the first quarter; the interest rates of the inclusive loans issued by the five large banks is 4.3%, 0.3% down the level of 2019. We have also increased credit loans. In the first quarter, credit loans issued to enterprises and individual business owners increased by 2.5 trillion yuan, with the increment almost twice the level of the same period last year. We have optimized loan renewal arrangements, expanded the scale of renewal and helped ease pressure on cash flow among enterprises. In the first quarter, a total of 576.8 billion-yuan loans were renewed, of which nearly 90% went to micro, small and medium-sized enterprises and individual business owners. Business are allowed to defer principal and interest payments, and we have deferred the payments on about 880 billion yuan worth of loans. There are also flexible arrangements for paying mortgage loans and consumption loans, which effectively reduce the pressure on enterprises and residents. 

Third, we are looking to maintain the stability of industrial chains and supply chains, as well as support all links in industrial chains to help them resume work and production in a coordinated way. We are taking significant steps to develop supply chain finance, and we have taken the initiative to connect with core enterprises of the industrial chain. Financing support is also being provided for upstream and downstream enterprises of the industrial chain to ensure the smooth flow of funds by means of receivables, orders and warehouse receipt pledges. By the end of the first quarter, banks provided capital turnover to 218,000 core enterprises of the industrial chain, with a balance of 21.4 trillion yuan. Banks also provided financing support to 297,000 upstream enterprises, with a balance of 5.8 trillion yuan. And banks provided financing support to 353,000 downstream enterprises, with a balance of 9.3 trillion yuan.

Fourth, we want to increase financial support for the real economy and promote the expansion of domestic demand. In the first quarter, new yuan-denominated loans hit 7.1 trillion yuan, an increase of 1.3 trillion yuan year-on-year. The new loans were mainly invested in the manufacturing, wholesale and retail and infrastructure sectors, with increased lending in these sectors of 1.1 trillion yuan, 0.9 trillion yuan, 1.5 trillion yuan, respectively, which has effectively supported the development of high-tech manufacturing, the upgrading of traditional industries, household and public consumption and investment in infrastructure. We support direct financing, such as bonds and equity, and provide comprehensive financing services for enterprises. In the first quarter, banks and insurance institutions increased bond investment by 2 trillion yuan, of which more than 360 billion yuan was invested in corporate credit bonds. An additional 126.3 billion yuan of equity investments was invested in insurance.

Fifth, we are seeking to guarantee the functions of the insurance sector. We will actively expand the scope of claims, increase speed and improve the efficiency of claim settlement. Insurance claims in the first quarter totaled 301.9 billion yuan. We will actively deal with social risk protection needs during the pandemic and develop and promote security insurance products, such as health insurance. The health insurance business grew by 21.5% year-on-year. We gave full play to the role of credit guarantee insurance in sharing credit losses. In the first quarter, the payment of credit guarantee insurance was 16.1 billion yuan, which was up 50% year-on-year.

The outbreak of COVID-19 has had an unprecedented impact on China's economic and social development. Loan delinquencies and defaults increased, and non-performing loans increased as a result of the pandemic. The banking industry still maintains a strong ability to withstand risks, and various regulatory indicators are operating at a high level.

Next, CBIRC will earnestly implement requirements for handling trade frictions and keeping employment, the financial sector, foreign trade, foreign and domestic investments and expectations stable, as well as ensuring the employment of residents, the basic livelihood of the people, the support for market entities, the security of food and energy, the stability of the supply chain and industrial chain, and the operation at grassroots level. We will work in a coordinated manner to provide financial support for the prevention and control of the pandemic and to serve the real economy and stave off risks. We will work hard to maintain economic development and social stability, and we will provide strong financial support to win the battle against poverty and for building a moderately prosperous society in all respects. 

Thank you！

Xi Yanchun:

Thank you, Mr. Huang. Let's move on to the question and answer section. Please inform us of your news organization before asking questions.

CCTV: 

A series of financial support policies for the resumption of production have been issued by CBIRC and other related departments since the outbreak of COVID-19. However, some enterprises said they have not yet felt or seen the effects of these policies. How about the implementation of these policies? What are the concrete plans to accelerate the implementation of the policies in the near future? Thank you. 

Huang Hong:

Thank you for your questions. Since the outbreak of COVID-19, the CBIRC has earnestly implemented the decisions and arrangements of the CPC Central Committee and the State Council, and it has also made overall plans for the prevention and control of the pandemic and the financial services related to economic and social development. A series of measures to support the resumption of work and production has been issued by CBIRC or other related ministries, which can be summarized as follows: 

First, we will optimize financial services in the field of pandemic prevention and control. Financial institutions are required to actively meet reasonable financing needs of health and pandemic prevention, pharmaceutical product manufacturing and procurement, public health infrastructure construction, and scientific research. We encourage financial institutions to help enterprises overcome the impact of the pandemic by appropriately lowering loan interest rates, improving policies on loan renewal, and increasing credit loans, along with medium- and long-term loans. According to statistics from the China Banking Association, bank institutions alone have provided more than 2.5 trillion yuan in credit to help fight the pandemic.

Second, a provisional deferment policy for both principal repayment and interest payment has been implemented for micro, small and medium-sized enterprises. In accordance with market principles and law, loan principal repayments that have matured since January 25, as well as interest payments, have been deferred provisionally for virus-stricken micro, small and medium-sized enterprises, with penalty payments exempted; their loan risk classification and credit records will not be affected. As of the end of March, banking institutions had deferred principle and interest payments on nearly 880 billion yuan (US$125.7 billion) of loans to micro, small and medium-sized enterprises.

Third, all links in the industrial chains have been pushed to resume work and production in a coordinated way. Banks have been encouraged to follow up and meet upstream and downstream enterprises' needs for work and production resumption and support them to raise funds through approaches including receivables, warehouse receipts and inventory pledges. The core businesses, after getting financing, have been encouraged to promote cash transactions between upstream and downstream companies as a way to reduce capital pressure and financial costs of micro, small and medium-sized enterprises.

Fourth, we have continuously improved quality and efficiency of inclusive financial services for small and micro enterprises. In the light of the overall goal of "increasing quantity, expanding coverage, improving quality and reducing costs," we have strengthened supervision of classified assessment, and urged banking institutions to stabilize credit supply and enhance the financial support to small and micro enterprises. By the end of March, the inclusive small and minor businesses loans stood at 12.55 trillion yuan (US$1.79 trillion), with a 25.93% jump year-on-year, which is much higher than the increases for other types of loans. 

Generally speaking, these policies have been implemented quite smoothly, and produced initial effects. However, we still found some problems in the following four aspects. First, some enterprises are not eligible to apply for loans; second, some cannot enjoy the policy support due to factors such as a third party's guaranteed renewal; third, there are some firms that did not apply because they were not aware of the specifics of these policies; fourth, some banking and insurance institutions have been negligent and failed to offer desirable services — responsibility for this final factor lies squarely on our shoulder. As a result of the above-mentioned problems, some enterprises felt they didn't enjoy the policy support, as you just mentioned.

The China Banking and Insurance Regulatory Commission (CBIRC) has attached great importance to these problems and taken actions to address them. Today, let me take this opportunity to invite our media friends to help by publicizing the financial supportive policies to more enterprises. Next, we will continue efforts to implement our policies and take such measures as window guidance, policy guidance, monitoring and statistical analysis, and summary and assessment to guide banking and insurance institutions to ensure flexible and efficient use of these policies. Efforts will also be exerted to promote coordination between banks and enterprises. By so doing, we will ensure that the policies are well-implemented and highly-effective, increasing enterprises' sense of gain. Thank you.

China News Service:

We know that the governance of small- and medium-sized banks and institutions is one of the key tasks of the supervision work. So, what are the specific measures being taken for this year's supervision? For those non-compliant shareholders, how is the work clearing their equities progressing?

Huang Hong:

Thank you for your question. I'll let Mr. Cao Yu take this one.

Cao Yu:

Thank you for interest in small- and medium-sized banks. The Central Committee of the CPC and the State Council have attached great importance to the supervision of small- and medium-sized banks and institutions. At the 2017 National Financial Work Conference, General Secretary Xi Jinping explicitly stated that we must improve the governing work of financial institutions' legal persons. In November 2019, the Financial Stability and Development Committee held its 9th conference and conducted a special study on deepening the reform of small- and medium-sized banks and resolving financial risk. The committee also emphasized the practice of sound corporate governance. Accordingly, the CBIRC cooperated with relevant departments to establish specific work plans and refine the governance requirements in detail.

Our current priorities for the governance of small- and medium-sized banks and institutions are: deeply integrating the Party's leadership and the governance of these banks and institutions, developing an evaluation system for their governance, and strengthening the "three boards and one management" system of supervision and accountability. The shareholders' structure must be optimized, the qualification of shareholders must be strictly checked, and their behavior must be regulated. A series of policies and regulations has been issued by the CBIRC, such as equity management measures, corporate governance supervision and evaluation measures. These documents have been laid as the regulation foundations for carrying out relevant works.

So far, initial progress has been achieved in the governance of small- and medium-sized banks and institutions. First, we have scaled up efforts to restrict irregularities and illegal equity-related actions, and constrain non-compliant shareholders. Last year, the CBIRC launched a campaign focused on regulating non-compliant shareholders and their affiliate transactions. Over 3,000 violations were found, and punishments were meted out. Over 1,400 non-compliant shareholders acting as natural persons or legal persons were cleared out. Since 2018, we have launched special investigations into small- and medium-sized banks and institutions within rural areas. So far, we have ordered non-compliant shareholders to transfer 3.3 billion equities, and we have punished 74 institutions to the value of 51.65 million yuan. Second, we have steadily conducted governance work to remove non-compliant shareholders and transfer their equities in high risk institutions. During the process of dissolving the risks in Baoshang Bank, the CBIRC prioritized governing non-compliant shareholders' equities and launching market oriented mergers and restructures. So far, progress has been made both in tackling risks for Baoshang Bank and in its reformations and reorganization work. For other institutions which have problems and have gained the attention of society, equity restructure plans have been enacted, and non-compliant shareholders have been removed and asked to withdraw their equities.

Although we have made some progress, we still face challenging tasks in enhancing the governance of small- and medium-sized banks and institutions. Next, the CBIRC will continue to act in accordance with market- and law-oriented policies to strengthen the regulation work and step up the centralized custody of equities. We will also further strictly check the qualifications of shareholders and reinforce pass-through management. Thank you.

The New York Times:

Many commodity exporting nations are running into difficulties now with low prices for oil and other raw materials. How would you handle impaired loans by Chinese banks to developing countries? And you are already saying there are impaired loans. Thank you.

Huang Hong:

Thanks for your question. We will have Mr. Xiao Yuanqi, chief risk officer of the CBIRC, take the question.

Xiao Yuanqi:

Thanks for your question. Both in China and overseas, Chinese banks have various business dealings, including loans. Affected by the COVID-19 outbreak and other factors, the global market has seen some turbulence, including in the financial sectors and the world economy as a whole. This has inevitably had an impact on the banks' overseas loans. This is not an issue limited to Chinese banks, as foreign banks are facing it too.

On the one hand, our banks should act in line with the market principles and laws in order to continue their normal operations in other developing countries and developed countries. On the other hand, we must bolster the risk assessment. Risk management in various sectors will be improved based on customer segmentation for banks. More importantly, these banks should strictly abide by Chinese laws and regulations, as well as those laws and regulations enforced in host countries and regions. Meanwhile, Chinese banks must carry out normal commercial activities in foreign countries in strict accordance with international rules. Thanks.

CRI:

How will the pandemic affect China's property and life insurance sectors? What roles will they play in boosting economic development? Thanks.

Huang Hong:

Thanks for your questions. I will take this one. As the pandemic continues to spread across the world, the global economy is facing mounting downward pressure. In China, the outbreak has posed new challenges and difficulties to the resumption of work and production , as well as domestic economic and social development. Economic fallout from COVID-19 has also weighed heavily on China's insurance industry with increasing uncertainties and instabilities. The impacts can be summarized as follows:

First, the growth of the insurance industry was under pressure. The epidemic caused a negative impact on production and people's life, as well as mounting downward pressure on the economy. As a result, the operation of insurance services was restrained and the growth of the industry faced great pressure. In the first quarter of 2020, the original insurance premium income grew just 2.3% year on year to 1.67 trillion yuan. Growth in original premium income plunged 13.6 percentage points in the quarter. The growth of property and life insurances decreased by 7.7 and 15.22 percentage points, respectively, from the same period last year.

Second, the income of some companies and individuals was hampered by increased volatility in business operations, causing them to have a hard time repaying funds and leading to a higher default rate. As mentioned above, credit guarantee insurance compensation expenses jumped about 50% — a significant rise in the first quarter. Other types of insurances, such as accident, health, agriculture and business interruption insurances, as well as insurances protecting people from contract delay or cancellation, have also seen their compensation expenses go up significantly. Additionally, there are increasing instabilities in the investment returns of insurance companies, as their business was hampered by the turbulence in global capital markets.

Third, expenditures of insurance companies have also gone up amid the outbreak, further increasing amortized costs.

Despite being challenged by the pandemic, the insurance industry can also benefit from a number of upsides that have resulted from it. Looking at the environment from a macro-economic perspective, the pandemic's downsides to economic and social development will be gradually lessened with the implementation of policies and measures adopted to prop up the resumption of work and production, increases in domestic demand and consumption, accelerated poverty alleviation work and sustained financial stability. Stable and long-term positive economic performance trends have not changed. At the same time, demand for insurance guarantees will ride the tide to secure consecutive growth when social risk awareness and individual insurance awareness become notably increased by a deepened understanding of the industry. Considering business cycles, as of mid-April, 99% of enterprises across the country that are above a designated size have resumed work, major nation-level projects and infrastructure constructions have made stable progress, public hygiene and suppliers of emergency products have received increasing investments and new-tech infrastructures, such as 5G and data centers that have been constructed in an expedited fashion. The insurance industry has received greater space for development as a result of the demand derived from new consumption models. The insurance industry has guaranteed sufficient reserves for reimbursements and ensured stable fluidities. Here, I would like to stress, in particular, that despite the recent, narrowing year-on-year growth rates, our business restructuring has made great headway in increasing the net cash flow at a substantial rate, which proves my mentioning that the fluidities are stable enough to cope with the brunt of adversities. The industry has reformed its management styles, reinforced scientific and technological innovation, transformed business models, improved management efficiencies, ensured scientific, technological and digitalized advancements and strengthened competitiveness to better meet the personal and social demands for insurance coverage.

In the next phase, the CBIRC will direct and boost the insurance industry's role in helping fulfill the "six guarantees" that can be fleshed out as follows. First, the industry is supposed to increase its supply to prepare for the resumption of work and production. In its active response to the growing demand for social insurance, the industry will increase the supply of healthcare insurances, especially medical insurance. The innovative products, exemplified by the "Hainan Comprehensive Insurance on Resumption of Work and Production in Line with Epidemic Prevention and Control Efforts," are supposed to coordinate efforts among industrial chains involved in work resumption. Second, guarantee insurance should play its role in ensuring financing and credit enhancement in a bid to bolster micro- and small-sized businesses, emancipating them from financial stresses and reducing their fundraising costs by offering more credit loans. Third, support to agriculture production should be guaranteed. Agricultural insurance should be given a boost, standards should be improved, spectrums expanded and services enhanced. Insurance mechanism devised to insure the three major staple foods during disasters and policy-led insurance regulations for hog supplies should be improved. In addition, the industry will also support agricultural production and work to avoid big price fluctuations on non-staple foods. Fourth, investments and exports should be buttressed to proactively guarantee a stable economic performance. The industry should enhance its risk-control capability to guarantee the smooth operations of the country's major projects, supporting traditional and modern infrastructural constructions. It should also develop export credit insurance to safeguard export enterprises and promote provisions for products to countries and overseas subsidiaries of Chinese companies that are involved in the Belt and Road Initiative. Fifth, the insurance funds, because of its diverse utilities, should be given full play to invest more in the country's key industries and core areas, allowing them to financially support domestic economic development. Sixth, insurance agent team should be expanded and more jobs should be added.

China National Radio (CNR):

Faced with the impact of the COVID-19 pandemic, will the banks' non-performing loan ratio continue to rise, or even rise sharply, in the second quarter and bring great risks? And how will the regulatory authorities respond to this? Thank you.

Huang Hong:

Thanks for your question. Mr. Xiao will answer it.

Xiao Yuanqi:

Thanks for your question. We are all concerned about the non-performing loan ratio. The data shows that the non-performing loan ratio rose in the first quarter, and the current ratio is 2.04%, 0.06 percentage points up from the beginning of this year. The ratio concerning small and micro enterprises and industries like catering and hospitality that have been severely affected by the pandemic has increased relatively fast, which is within our estimation range. We have paid close attention and conducted an analysis of the non-performing loan ratio in the second quarter, and we will continue to do so for some time to come. We think that the ratio will further increase in the near future but won't climb high. We are resuming work and production in an orderly manner, and we have implemented a series of hedge policies to mitigate risks. The policies and measures have begun to show their effectiveness.

In terms of supervision, we have recently been conducting analysis and close monitoring. First, we have conducted stress tests, including differentiated tests set by different steps and circumstances, as well as comprehensive tests. Second, we have intensified efforts to dispose of non-performing loans. In the first quarter, we disposed of non-performing loans worth more than 450 billion yuan ($63.53 billion), increasing by 81 billion yuan ($11.43 billion) over the same period of last year. Additionally, we have expanded our channels and methods of disposal, which not only reduced the non-performing loans of the banks but also provided them with conditions to create more new loans to support enterprises. Third, we have asked all banks to make more efforts to support enterprises, especially medium, small and micro enterprises, in their resumption of work and production. The support given to the enterprises is a measure of the banks to prevent risks because as long as the enterprises can develop well, the non-performing loans of the banks will decrease. The difficulties encountered by the enterprises are temporary, and they are caused by external factors. Before the COVID-19 outbreak, the fundamentals of most enterprises were good. However, since the pandemic, lots of enterprises have had to face temporary difficulties in operation and cash flow, which have made them fail to repay their loans on time. In addition to hedge measures, the banks should also strengthen their capabilities in risk management and segmentation of customers to separate enterprises affected by the pandemic from those that previously had operating problems. Most of the enterprises in difficulty belong to the former group.

We have sufficient provisions and capital to fend off risks. At present, we have provisions worth more than 6 trillion yuan ($840 billion), which give us strength in facing the challenge. In short, there will be a small increase in the non-performing loans of the banks. However, thanks to all these measures, we believe that risks can be controlled completely, and our ability to fend off risks is sufficient. Thank you.

China Review News:

The Luckin Coffee fraud has garnered a great deal of attention recently. What is the supervision department's take from this? How many loans has Luckin taken from the banks? What are the risks? Will the directors liability insurance cover this? Thank you.

Huang Hong:

I'd like to invite Mr. Cao Yu to answer this question.

Cao Yu:

Thanks for the question. Many people here are consumers. A market economy is governed by law. Observing disciplines, obeying laws and being honest is a basic requirement of Chinese law for the main body of a market economy. It is the legal obligation of all enterprises to truly, comprehensively and truthfully reflect the financial and accounting situation of enterprises.

The Luckin fraud is a flagrant offense, and it will offer profound lessons. The CBIRC will firmly support and actively cooperate with the department in charge to impose severe punishment according to law. A zero-tolerance attitude will be taken toward financial fraud to maintain a sound market environment. 

As far as we are concerned, Luckin Coffee has a small loan standing with the banks and an even smaller loan balance. We have already urged relevant banks to enhance capital risk monitoring and post-loan management. Regarding the directors liability insurance, Luckin Coffee bought the directors liability insurance before listing. There are four levels of insurance policy with a total limit of $25 million, and a dozen insurance companies from home and abroad have been involved. Some of them issued reinsurance to this business. We understand that the insurance companies have received Luckin's claims. Considering that the case is complicated, the investigation is still ongoing and uncertainty exists. We will urge relevant insurance companies to properly handle it according to laws and regulations and in accordance with the contract provisions of insurance policy. Thank you.

Phoenix TV:

We have seen major fluctuations in Shenzhen's real estate industry. Many analysts have attributed this to subsidized loans that have flowed into the real estate market. What is the opinion of the CBIRC on this matter?

Huang Hong:

Thanks for your question. Mr. Xiao Yuanqi, the chief risk officer, will answer it. 

Xiao Yuanqi:

Thank you. This has been a matter of concern recently. Our Shenzhen Office and the Shenzhen Central Sub-branch of the People's Bank of China have taken appropriate supervision measures. We hold that loans should be used in strict accordance with the application, and no diversions should be allowed. For mortgage lending businesses, both operation and mortgage loan usage should correspond with the intended use of the funds as written on the applications. We require the banks to monitor the money flow and make sure that funds are used for the right purposes; as for loans that have been illegally moved into the real estate industry, we have asked them to diligently make corrections. Thanks.

Financial Times:

How does the pandemic impact the solvency of small and medium-sized commercial banks? Do you anticipate more monitoring and reform measures to emerge this year?

Huang Hong:

Thanks for your question. Mr. Cao Yu, vice chairman of the CBIRC, will answer it. 

Cao Yu:

Thanks for your question. In China, there are more than 4,000 legal entities that are small and medium-sized banks, with total assets of around 77 trillion yuan. Small and medium-sized banks are the main force to provide financing services for the agriculture sector and small and medium-sized enterprises. Since the management ability and business capacity of these banks is limited, and especially since their customers are special to some extent, the impact of the pandemic on these banks is quite noticeable. 

To this end, according to the requirements of the Financial Stability and Development Committee under the State Council, the CBIRC has gone all out to deepen the reform of small and medium-sized banks and dissolve risks. Several departments in our sector have produced relevant work programs, which have thus far gone smoothly. This year, a string of great and significant reforms to small and medium-sized banks will occur, particularly in regard to market restructuring. Here, I would like to inform you that relevant sectors have provided favorable conditions for small and medium-sized banks, particularly with respect to the policies regarding renewal loans and targeted cuts to required reserve ratios. The CBIRC will also implement differential policies for the banks. All of these will create favorable conditions for their reform.

We believe that with our joint efforts the small and medium-sized banks will get onto a path that allows for sound development. In particular, they will provide more financing services for the agriculture sector and small and medium-sized enterprises, and fully realize their roles. We would like to call on every aspect of society to pay attention to the development of small and medium-sized banks and provide an excellent internal and external environment to allow for their sound development. Thank you. 

Hong Kong Economic Herald:

What measures will be taken to deal with small and micro businesses that lack credit records but want to get a loan for the first time?

Huang Hong:

Thank you. Mr. Xiao will answer your question.

Xiao Yuanqi: 

We attach great importance to this matter. The China Banking and Insurance Regulatory Commission (CBIRC) has done a great deal to provide inclusive financial support to small and micro-enterprises. Currently, there are indeed still some small and micro businesses, especially micro-enterprises and individually-owned businesses, who have not obtained credit support or bank loans. The reasons for this are multifaceted. Some enterprises don't meet the loan requirements and some don't have access to the service. We have been stepping up measures to ensure that small and micro enterprises get loans. In particular, we will strengthen services for small and micro enterprises that haven't obtained their first loans yet to fulfill loan demand and raise the first loan ratio.

China Daily:

It has been reported that some banks and insurance institutions sold millions of pieces of their client's information. Is this true? What will the China Banking and Insurance Regulatory Commission (CBIRC) do to ensure the information security of clients? Thank you.

Huang Hong:

Thank you. I will take your question. The CBIRC has adopted a zero-tolerance attitude towards acts that infringe on the rights and interests of financial consumers and damage the information security of clients. Once discovered, such acts will be investigated in accordance with the law and punished severely. We have taken note of the media reports. In fact, we had already begun monitoring the illegal sale information outside of China two days before the reports came out, and we immediately asked relevant institutions to carry out a sweeping investigation. The institutions have subsequently released responses. Most of the information was fabricated and patched up by hackers.

The CBIRC attaches great attention to the cybersecurity of banks and insurance institutions, and the protection of client information, in particular, is a top priority. Over the years, we have issued a lot of regulatory policies requiring banks and insurance institutions to implement individual information protection laws and regulations, enhance the protection of clients' private information and strictly carry out institutionalized management of client information from collection, to storage to destruction.

The CBIRC established long-term working mechanisms that involve cybersecurity risk monitoring, risk warning, off-site supervision, on-site inspection and supervision rating, and incorporated the protection of client information in the banking and insurance sector into daily information technology risk monitoring. The CBIRC has also held special campaigns for client information protection and cybersecurity of the banking and insurance sectors at irregular intervals, thereby guiding and supervising banks and insurance institutions to strengthen the investigation and rectification of cybersecurity risks.

Next, the CBIRC will uphold the principle of "supervision for the people," further enhancing the cybersecurity supervision of the banking and insurance sectors and urging banks and insurance institutions to keep intensifying relevant work. We will further create a safe and reliable internet financial environment and protect the rights and interests of financial customers.

Xi Yanchun:

Thanks again to the speakers and everyone else. Today's press conference is hereby concluded.

.

Read in Chinese

Speaker:

Peng Huagang, member of the CPC Committee of the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council, secretary general and spokesperson of SASAC

Xia Qingfeng, head of the SASAC Department of Publicity and spokesperson of SASAC 

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office

Date:

April 20, 2020

Xi Yanchun:

Ladies and gentlemen, friends from the media, good morning. Welcome to this press conference. Today, I am delighted to welcome Mr. Peng Huagang, member of the CPC Committee of the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council, secretary general and spokesperson of SASAC; and Mr. Xia Qingfeng, head of the SASAC Department of Publicity and spokesperson of SASAC. They will introduce the performance of state-owned enterprises managed by the central government (centrally administered SOEs) in the first quarter of this year. They will also answer some of your questions.

First, I'll give the floor to Mr. Peng.

Peng Huagang:

Friends from the media, good morning. First, please allow me to extend my appreciation to you for your long-term attention and support for SASAC and centrally administered SOEs. Before answering your questions, I'd like to make a brief introduction to the performance of centrally administered SOEs in the first quarter of this year.

The first quarter of this year was extremely unusual, as the sudden COVID-19 outbreak caused an unprecedented impact on China's economic and social development. The SASAC and centrally administered SOEs firmly acted on the guiding principles embodied in General Secretary Xi Jinping's important speeches as well as policies and plans made by the CPC Central Committee and the State Council. We went all out to fight against the pandemic, establishing strong leadership and an efficient working mechanism. We mobilized all staff members and developed comprehensive plans to improve our work in all aspects. In this way, we've made a positive contribution to coordinating epidemic prevention and control with economic and social development.

In the first quarter, the outbreak visibly increased instability and uncertainty on China's economic development and blocked the economic cycle, thus creating downward pressure far greater than expected. Centrally administered SOEs faced multiple challenges in their production and business operations, leading to a decline in major indicators.

Peng Huagang:

Compared with the first quarter of last year, the total operating revenue of centrally administered SOEs fell by 11.8% to 6 trillion yuan this time round, and more than 80% of those enterprises saw their revenues decline. The total net profit reached 130.4 billion yuan, down 58.8% year-on-year. 57 centrally administered SOEs saw a decrease in their net profits, and 26 made losses. In terms of monthly data, although the total net profit in March showed a sharp recovery from that in February, they were much lower compared with the same period last year. 

As the virus is raging across the world, the domestic and global demand for commodities, such as crude oil, has shrunk, forcing sharp falls in oil prices. Some centrally administered SOEs in the energy industry implemented national policies by lowering prices to benefit customers. Under the combined influence of market developments and relevant policies, centrally administered SOEs in petroleum and petrochemicals, aviation, automobile, and electrical grid sectors saw a massive drop in both revenues and profits.

On the whole, most centrally administered SOEs have encountered unprecedented difficulties in their production and business operations and come under intense pressure to increase profits. However, all enterprises are taking various measures to overcome difficulties and recoup their losses, thus maintaining a stable overall performance.

First, centrally administered SOEs are accelerating the resumption of work and production, with business operations back on track. Enterprises in petroleum and petrochemicals, power and grid, steel, machinery manufacturing, and air transportation sectors didn't suspend production during the Spring Festival and the outbreak. Instead, they made an all-out effort to stabilize operation. By the end of February, more than 90% of centrally administered SOEs had resumed production, and now the figure has reached 99.4%. Despite difficulties, centrally administered SOEs in construction, automobile, tourism, and other sectors hit hard by the outbreak returned to work earlier than other enterprises in the same sector. Centrally administered SOEs responsible for crucial projects did their utmost to ensure the progress of key projects.

Second, most centrally administered SOEs reported better profitability. With the work of COVID-19 prevention and control being conducted steadily and positively across China, the operating revenues of centrally administered SOEs reached 2.2 trillion yuan, returning to the same level as January. A total of 11 central SOEs saw year-on-year growth in the first quarter. In March, the profitability of 43 central SOEs returned to the average growth level in 2019, while 37 central SOEs saw the rate of profit decline by more than 10 percentage points from the first two months of 2020.

Peng Huagang:

Third, investment in key industries grew steadily. As a result of work suspension amid outbreak, the fixed asset investment of centrally administered SOEs in the first quarter amounted to 364.76 billion yuan, falling 4.5% year-on-year. However, such investment grew 4.1% on a yearly basis in March, and the monthly investment had returned to a normal level. 

In terms of key industries, the fixed-asset investment of central SOEs in petroleum and petrochemical, power, and telecommunications sectors surged 12.4%, 2%, and 12.3% on a yearly basis respectively in the first quarter of this year.

Fourth, the financial structure of centrally administered SOEs remained stable. By the end of March, the average asset-liability ratio of centrally administered SOEs stood at 65.6%, down 0.1 percentage points from the same period last year. The asset-liability ratio of 56 centrally administered SOEs declined yearly, and 37 companies saw a fall by at least 1 percentage point. The average ratio of interest-bearing liability was 40.3%, flat with the same period last year. The current ratio and quick ratio increased slightly year-on-year. The overall solvency of centrally administered SOEs remained stable in the first three months.

Due to the impacts of COVID-19 outbreak, slumping oil prices and interest concession policies, China's central SOEs have seen a major decline in their profits for the first quarter. But despite this, it was still not easy for central SOEs to deliver such economic performance, as they have made far more efforts than usual to fight the epidemic while resuming production and promoting development.

This year will witness the last step of China's efforts to build a moderately prosperous society in all respects and win victory over the battle against poverty. As we were hit by the spread of the pandemic, our tasks will be much more challenging and we still have a long way to go before achieving our social-economic development goals. The State-owned Assets Supervision and Administration Commission (SASAC) of the State Council will join hands with central SOEs to comprehensively analyze the impacts of the epidemic, withstand the pressures and further focus on our objectives and tasks. We will also implement precise policies to overcome the adverse effects of the epidemic. On the basis of implementing regular epidemic prevention and control measures, priority will be given to "three stabilities,""four guarantees" and "one strengthening."

"Three stabilities" means that we will firstly stabilize the smooth operation of central SOEs, coordinate domestic and international markets, and ensure well-organized production, transportation, sales and storage. Secondly, we will stabilize the industrial chain and give full play to the leading role of central SOEs to maintain the stability and competitiveness of China's industrial chain and supply chain through coordinating their upstream and downstream companies. Thirdly, we must stabilize enterprises. We need to guard against any risks to ensure that the state-invested enterprises, except those "zombie enterprises", do not go bankrupt, significantly cut pay or lay off employees, and do not add destabilizing factors to our society.

Peng Huagang:

"Four guarantees" refers to work in the following four respects: First, we must guarantee the country's economy and people's livelihood. Efforts will be made to fully ensure supplies of primary products and services, including coal, electricity, petroleum, gas, communications, and grain, so as to provide powerful support for maintaining normal economic and social order. Second, we are guaranteeing the implementation of major projects. We will make all-out efforts to ensure that major science and technology programs, major projects set out in the 13th Five-Year Plan, and major projects under the Belt and Road Initiative (BRI) can be steadily advanced and implemented as scheduled. Third, we will guarantee workplace safety. We will require enterprises to strictly assume primary responsibility for safety, and launch a three-year full-scale special campaign to ensure workplace safety as the epidemic prevention and control will probably become a long-term new normal. Fourth, we will guarantee high-quality development. We will follow the new development philosophy, put quality first and give priority to performance. We will work hard for better quality, higher efficiency, and more robust drivers of economic growth through reforms. We will strive to achieve economic growth with quality and efficiency to better serve the work of the Party and the country. 

"One strengthening" means that we will uphold the leadership of the Communist Party of China (CPC) and strengthen Party building. In this respect, we will bring into full play the leadership role of the Party committees or leading Party members' groups at central SOEs, the pivotal role of the Party organizations at all levels, and the vanguard and exemplary role of the Party members and officials. By so doing, we will be able to provide a strong guarantee for coordinating the epidemic prevention and control work with the reform and development of our enterprises. 

Under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the SASAC and central SOEs will strengthen consciousness of the need to maintain political integrity, think in big-picture terms, follow the leadership core, and keep in alignment. They must also increase confidence in the path, theory, system, and culture of socialism with Chinese characteristics; and 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 conscientiously implement the policy decisions and plans of the CPC Central Committee and the State Council, face up to difficulties, and work hard to regain the lost time caused by the outbreak and reduce economic losses. We will ramp up efforts to secure our annual growth targets, and make more contributions to achieving the goal of securing a decisive victory in building a moderately prosperous society in all respects and winning victory over the battle against poverty.

Next, Mr. Xia Qingfeng and I will take your questions. 

Xi Yanchun: 

Thanks to Mr. Peng Huagang for his introduction. Now, the floor is open to questions. Please identify your media organization before asking questions.

CCTV:

Mr. Peng, you just mentioned that China's centrally administered state-owned enterprises (SOEs) saw profits and revenues dive during the first quarter. Would you like to explain the reasons for us? Thanks.

Peng Huagang:

Thanks for your question. I just mentioned that the production and operation of centrally administered SOEs have been hit hard by the outbreak and slumping oil prices. In the meantime, centrally administered SOEs have taken measures in response to the outbreak, and this has led to the plunge in revenues. The major reasons are as follows:

First, direct-to-consumer industries like the aviation, automobile and tourism industries have been hit hard by the pandemic. In the first quarter, there was a plunge in air traffic passenger demand, with decreasing passenger trips and seat occupancy rates. Some companies have incurred losses, and the aviation industry has generally operated at a loss. As vendors and suppliers are unable to resume production and operation in time, the sales of automobiles have decreased by 30% from the previous year, shaving revenues by 10 billion yuan in the first quarter compared to the same period last year. Dongfeng Motor, which is located in the former epicenter of the outbreak, has faced more serious repercussions. As almost all travels and business trips were postponed due to the outbreak, numbers of visiting tourists and hotel occupancy rates fell greatly, resulting in huge losses in revenues.

Second, the plunge in international crude oil prices has led to a significant reduction in profits by centrally administered oil and petrochemical enterprises. The price of Brent crude oil fell from $68 per barrel in early January to $23 per barrel at the end of March, which showed a drop of more than $40. Though the plunge in oil prices lowered the costs of overall national economic operation, it also had impacts on the operation and production of the centrally administered oil and petrochemical enterprises. As the market demand decreased in the first quarter, the sales of refined oil fell by more than 20%. Companies in petroleum exploration and refining industries reported that their revenues cannot cover costs. Oil and petrochemical enterprises are losing money. All of these factors led to a 30-point reduction in the growth of profits for the centrally administered SOEs.

Third, centrally administered SOEs implemented policies to give up profits amid the outbreak. SOEs firmly carried out policies to ease consumers' costs by 45 billion yuan, including reducing the price of electricity, gas and rent, and they also waived road and expressway toll fees. For example, the grid companies have taken measures to reduce the price of power used in large industries and common commerce by subtracting 3.3 cents per kilowatt-hour from the price of electricity, reducing the operational costs of more than 50 million companies by 20 billion yuan. The price of gas for non-residential use has been cut by 0.3 yuan per cubic meter, saving all non-residential natural gas users 7.5 billion yuan. And telecommunication companies have postponed the suspension of mobile services for 1.6 billion users and canceled the suspension of mobile services for 2.9 million medical health workers, as well as others working on the frontline of the fight against the pandemic. They also reduced charges of broadband services for micro, small and medium companies, saving those users 15 billion yuan.

Fourth, the costs of pandemic prevention and control efforts have an impact on revenue growth. Centrally administered SOEs in sectors that include coal, power, oil, transportation, grain and telecommunications have spared no effort to guarantee the supply of basic products and services and to expand and switch production to medical supplies. Airline and logistics companies work to guarantee transportation regardless of the costs. Companies in building sectors have taken on the mission of building specialized and makeshift hospitals. Many centrally administered SOEs have also sent out medical teams to Hubei. Since the outbreak, costs of labor, materials and logistics have increased greatly. In the first quarter, for every 100 yuan of business income, the cost that centrally administered SOEs had to pay increased by 2.4 yuan over the previous year.

The operation of centrally administered SOEs during the first quarter was influenced by multiple factors. The plunge in revenues is the price we have to pay for the COVID-19 prevention and control work. Compared to people's lives and health, it is worth paying the price. And the loss is temporary, and it can be mitigated through effective measures.

I need to point out that economic development is coming back to the track of sound development, and centrally administered SOEs have fared better as they are revving up work resumption. For example, during the first quarter, the output of crude oil and coal in centrally administered SOEs maintained positive growth. The value of newly signed contracts by construction enterprises increased by 3.7% over the previous year, with the value of contracts signed overseas growing by 18%. In March, the total power output of thermal power plants and the volume of goods transported by water transportation companies have recovered to the level seen in the same period of last year. Since April, in particular, the average daily sales of crude oil and steel are basically at last year's levels. And electricity consumption is above the level seen in the same period of last year. SASAC and centrally administered SOEs will work together and take effective measures to overcome difficulties, and they will make a big push to recover losses.

CRI:

We have learned that central enterprises have made notable progress with respect to adopting scientific and technological approaches that help in the fight against the virus. Would you please elaborate on how that happens and what achievements have been made? Thank you.

Peng Huagang:

Thank you for your question. We will give the floor to Mr. Xia Qingfeng to answer your question.

Xia Qingfeng:

Notable progress has been made by central enterprises to help with anti-virus efforts. These enterprises have used scientific and technological advantages, such as big data, artificial intelligence, cloud computing and 5G, for anti-virus efforts since the outbreak of the pandemic.

First and foremost, big data has been adopted to bolster joint epidemic control and prevention efforts. Giving full play to big data, characterized by multiple sources, substantial resources and great inclusiveness, the central enterprises have rolled out a multitude of services that buttress decisions made directly in line with epidemic control and prevention efforts as well as on resumption of work and production efforts. For instance, "Smooth Mobility Online", a big data service developed by China Electronics Technology Group Corporation (CETC), has been working on prevention and resumption. As of April 17, the service for this program that detects when people make close contact with confirmed cases had been used over 446 million times. More than 160,000 people were detected as close contacts after consulting the program. In addition, China Unicom has also launched several big data products, such as a forecast of potential risks among communities and a health U code that provides free access to the entire society for making inquiries about epidemic prevention, risk warning, outdoor safety and resumption of work.

Second, major breakthroughs have been made since we increased our efforts to beef up the development of medical sciences. The central medical and pharmaceutical enterprises have made numerous breakthroughs, regarding nucleic acid tests, vaccine development, research and production of medical equipment. These breakthroughs, which from the start have responded to pressing situations, occurred over a short period. For example, the inactivated vaccine developed by the China National Biotech Group Co Ltd (CNBG), which is affiliated with China National Pharmaceutical Group Co Ltd (SINOPHARM), has already entered the clinical experiment phase. In addition, some enterprises have expedited research and production of medical equipment. Take China Aerospace Science and Industry Corporation (CASIC) for example, besides developing high-performance ventilators for severe cases that are used in Intensive Care Units, it has also worked on negative pressure modules that are applied in shelter hospitals. 

Third, the development of new industries should accelerate with digital support. The central enterprises have made full use of internet connections around-the-clock to assist remote education, home-based work and business performances. The telecommunication enterprises have, therefore, enabled online education to reach over 100 million users. They also provide office services, such as video conferences and wireless communication, to more than 7.7 million administrative bodies and market entities. These services can be used free of charge for more than 4,000 minutes. The virtual platform established at China Petrochemical Corporation (Sinopec) has ensured smooth operation and production during the epidemic by providing expert support, online management and dynamic monitoring for fieldwork, which includes petroleum exploration, refining and transporting.

Xia Qingfeng:

Fourth, advanced technology products have been adopted to support anti-epidemic efforts. Sterilization with radiation exposure provided by China National Nuclear Corporation and China General Nuclear Power Group has substantially prolonged effective periods of sterilizers. The chip developed by China Electronics Corporation has enabled the full production of body temperature test kits. The highly-efficient glass fiber filter paper produced by China National Building Material Company Ltd has been involved in the construction of Huoshenshan and Leishenshan Hospitals in Wuhan, which is the capital of Hubei province; this paper, which is able to filter out 99.97% of the granules estimated a t 0.3 micrometers, can help ward off airborne coronavirus aerosol particles.

Fifth, production with artificial intelligence should be applied to support automatic manufacturing and remote medical treatments. Central enterprises, which have made full use of 5G, the Internet of Things, the Industrial Internet and artificial intelligence technologies, have undertaken the construction of automatic workshops and smart factories to upgrade intelligent production and reduce the size of the on-site labor force. The 5G-based intelligent equipment, including robots for medical services, emergency ambulances, driverless cargo vans and epidemic control vehicles, developed by China Mobile have reached 3,900 medical institutes and supported more than 30,000 remote group diagnoses.

As we always say, opportunities often arise amid challenges. Therefore, the State-owned Assets Supervision and Administration Commission of the State Council will direct central enterprises to effectively make use of experiences, research and development progress and industrial advancements that arose during this epidemic. We will step up our efforts to work on a well-designed layout of emerging industries that includes the Internet of Things, the Industrial Internet, cloud computing, big data and artificial intelligence. Our involvement in life sciences, remote medical treatments, medicines and healthcare services should be much expanded. The integration of modern information technologies, including the internet and big data, into traditional manufacturing industries should be enhanced in an effort to help manufacturers transform and upgrade. Thank you.

Xinhua Daily:

What measures will the SASAC and enterprises directly under the central government take to cope with the impact of the COVID-19 pandemic? Also, for Mr. Peng, how do you think enterprises directly under the central government will perform in 2020? Will these annual indicators be adjusted? Thank you.

Peng Huagang:

Thank you for your question. Regarding the difficulties and challenges brought about by the COVID-19 pandemic, both the SASAC and enterprises directly under the central government are actively conducting relevant research in order to mitigate the loss accordingly. The CPC Central Committee has made some important deployments in this regard. Earlier on April 16, the Political Bureau of the CPC Central Committee held a meeting to analyze the current economic situation and make arrangements for economic works. In order to implement the decisions and requirements being made by the CPC Central Committee, the SASAC held a video conference on April 17 based on our existing investigation, which systematically made arrangements for our work in the next step. In general, we have put forward three major requirements: First, we need to face the challenges and mitigate the losses brought about by the COVID-19 pandemic to the greatest extent possible. Second, we need to proceed with confidence and work diligently. Third, we need to shoulder our responsibilities and work to bring about the continuous and healthy growth of the national economy.

The SASAC and enterprises directly under the central government will continue to remain "battle ready." While dynamically optimizing measures for pandemic prevention and control as well as improving the effectiveness of our work, we will also be fully committed to preventing a slowdown and achieving steady growth. The specific measures are as follows:

First, we will spare no effort to expand the market. We will develop and further expand the domestic market while also speeding up the construction and production of existing projects and orders. This will help to avoid late deliveries, loss of customers, and breaches of contracts. We need to seize the growth opportunity presented by the recovery period that will follow the pandemic subsides, and work in accordance with the national strategy for boosting domestic demand. We should work to meet local demands concerning investment and construction in order to effectively mitigate losses resulting from the COVID-19 pandemic. We will also pay attention to world-wide business operations and work to implement major BRI projects through specific and targeted measures for each company in different countries. This will ensure normal business operations for the overseas project as well as the timely delivery of orders. We will support enterprises directly under the central government to further cooperate with enterprises of other ownership and learn from each other in terms of investment and shareholding, product cooperation, R&D collaboration and experience sharing. Enterprises directly under the central government should also lead SMEs so as to achieve mutual development. 

Peng Huagang:

Second, we need to adopt the multi-layered measures and explore the potential of development in relevant sectors. We will step up efforts to reduce costs and improve efficiency, applying cost management to all staff, factor and business procedures. The cost of business operation will be greatly reduced, especially in terms of management and techniques. We will make more efforts to deal with inefficient and invalid assets. We will quickly divest in businesses that lack competitive advantages and development potential. We will speed up the liquidation of inefficient and invalid stock equity. We will also step up efforts to manage unprofitable companies. Based on our concluding work of helping "zombie companies and troubled businesses," we should further work on the management of unprofitable listed companies as well as relevant major branch companies, sparing no effort to reduce losses.

Third, we will speed up industrial upgrades and shore up weaknesses. Regarding problems emerging amid pandemic, we need to speed up industrial transformation and upgrades while also optimizing product services in order to build up strengths and shore up weaknesses. In terms of the development of core technologies, we need to focus on cutting-edge fields, such as biosciences and healthcare, stepping up the R&D efforts accordingly. As for the optimization of the industrial structure, industries involved with healthcare, public epidemic prevention and control and emergency management should be further developed. Emerging industries, such as cloud computing, big data and AI, should also be supported so as to develop a new engine. Regarding smart transformations and upgrades, we should make full use of the advantages of enterprises directly under the central government and let them become the main driving force for new infrastructure. New forms of business, such as the digital economy, will be supported, and traditional industries will be transformed at an accelerated pace. 

Fourth, we will step up reform efforts. In accordance with the requirements of the upcoming three-year action plan on the reform of state-owned enterprises, we will carry out proactive, bold and pragmatic reform, introducing relevant measures to improve the vitality and efficiency of enterprises, which will help us to cope with the effects of the pandemic.

Fifth, we need to prevent the risks and stick to the bottom line. We need to stay conscious about the bottom line and strengthen risk management. We need to pay close attention to capital risks and properly prevent and control debt risks. In the meantime, risks associated with financial businesses should be kept under control, and risks associated with investment should always be prevented. Compliance risks should be controlled strictly, and we need to stick to the bottom line and prevent the occurrence of major risks.

The SASAC and enterprises directly under the central government will stick to these targets, making full use of all the resources available and overcoming difficulties in order to make up for losses to the greatest extent while also achieve the best possible results. Thank you.

China Business Network:

When will the three-year action plan on the reform of state-owned enterprises (SOEs) be launched? Could you share the general guidelines and key tasks of the reform? What breakthroughs will be made in the reforms of mixed SOE ownership, SOE restructuring and the supervision mechanism of state-owned assets in the year 2020, the first year of the action plan? Thank you. 

Peng Huagang: 

Thank you for your question. This is also a matter of public concern. The action plan has preliminarily taken shape over a period of time that has included plenty of research, repeated evaluation and improvement. It now comes into the approval process. It is highly valued by the CPC Central Committee and the State Council as a pressing issue of high urgency. When it is launched, we will give a systematic and comprehensive introduction to the plan. 

As for your question, the overall consideration of the plan is to better implementing General Secretary Xi Jinping's major expositions on SOE reform and, development of state-owned assets and enterprises, as well as a Party building. This involves three important issues: First, the requirements of the 19th National Congress of the Communist Party of China on SOE reform will be further specified and carried out in the three-year actions. Second, a number of SOE reform policies, namely the "1+N" policies, have been implemented in recent years. For those not put in place, we have made a schedule and a roadmap to accelerate the implementation. Third, we have gained some experience at the grassroots level in recent years from pilot and demonstration projects, including "Ten Pilot Reforms" and "Double Hundred Actions." The experience will be promoted in the next step of SOE reform.

In fact, these considerations and requirements will be fully reflected in the action plan, even though it has not yet been released. Nevertheless, the actions have started this year, which is the first year to implement the three-year action plan. We have laid out some of our priorities for reform this year, and we have advanced them actively, which embodies the requirements of the three-year action plan. This year's reform will focus on the following aspects:

First, we will improve the modern enterprise system with Chinese characteristics. We will implement the "two policies of consistency" to encourage the establishment of a board of directors, as needed. We will further clarify the boundaries of rights and responsibilities of Party committees (leading Party groups), boards of directors, managers and other governance bodies to implement the functions and powers of the board of directors and accelerate the establishment of a corporate governance mechanism in which one will do their part while cooperating with others to have effective checks and balances. 

Peng Huagang:

Second, we will accelerate the establishment and improvement of a market-based operation mechanism. We will advance the contract management of management members' tenures and the establishment of a professional managers system, and we will encourage SOEs to actively coordinate the use of medium- and long-term incentive policies to increase their vitality and efficiency. 

Third, we will actively, yet prudently, deepen the reform of introducing mixed ownership to SOEs of different levels and categories. In particular, we will promote an in-depth transformation of operating mechanisms in mixed-ownership enterprises and give full play to the positive role of the shareholders of non-state-owned enterprises.

Fourth, we will improve the distribution of state-owned assets and promote strategic restructuring and specialized integration to guide enterprises in further focusing on the real economy and strengthening their core business. The SOEs, in particular, will be given their guiding role in structural improvement, free circulation and stable growth in a bid to offset the negative impacts of the pandemic.

Fifth, we will improve the state-owned assets supervision system, with a focus on the management of capital. We will delegate more powers in order to have state-owned assets play an effective role in investment and company operation.

Sixth, we will push forward special projects, including the "Double Hundred Actions" and "Comprehensive Regional Reform Tests," as well as "Demonstrative Actions on Reforms of Technology-Based Enterprises," to give full play to their demonstrative and leading roles.

Seventh, we will further strengthen the Party's overall leadership with respect to SOEs. We will boost the Party building in SOEs and give a leading role to entrepreneurs so they may lead the development of SOEs with high-quality Party building. Thank you. 

Macao Daily News:

Recently, there have been more discussions about China's manufacturing industry, and some countries said they would spare no expense to subsidize costs, encouraging their enterprises to move manufacturing back to their countries and calling for the return of the industrial chain. At the same time, due to the shutdown of foreign factories, some enterprises lack production components. Are central SOEs prepared to respond to new situations in the industrial chain and supply chain? Thank you.

Peng Huagang:

Thank you for your question. Mr. Xia will answer it.

Xia Qingfeng:

Indeed, as the reporter just said, there are increasing discussions on the manufacturing industry happening in society, and there are also many voices being heard in the international community. We believe that the global economy is a whole entity. The industrial chains and supply chains of various countries are interlinked, and after more than 40 years of reform and opening-up, China's economy has been deeply integrated into the global industrial chain and supply chain. Due to the impact of COVID-19, all countries in the world are tightening their prevention and control measures, and the smooth and orderly operation of the global industrial chain and supply chain has been affected to varying degrees. Central SOEs have also encountered the delay of existing contracts, decrease of new orders and risks in the supply of some required raw materials and spare parts. As for the question of how to deal with the impact of the pandemic on the industrial chain and supply chain, our opinions are as follows: 

On the one hand, we must continue to give full play to the role of the global industrial chain. At present, the overall pattern of the global industrial chain and supply chain is the result of years of joint efforts and common choice made by the enterprises of various countries. It is the result of the function of comprehensive factors, such as factor costs, industrial support and the infrastructures of various economies. It is not formed overnight, nor can it be changed by any individuals or countries at will. We believe that short-term subsidies cannot stop the long-term market trend. There is an old Chinese saying that "it is important to take a long-term perspective," and we will encourage central SOEs to continue strengthening cooperation in the global industrial chain. On the other hand, we must make full use of the advantages of the domestic industrial chain. Central SOEs have a relatively complete industrial system, and they have certain development resilience, potential and room to maneuver. Since the outbreak, central SOEs have spared no effort to ensure stable production and supplies, protect people's livelihoods and stabilize the market, and they have taken the lead in resuming work and production. Now, 99.4% of central SOEs have resumed work and production. In doing so, they have driven medium, small and micro-sized enterprises in the upstream and downstream of the industrial chain to reboot engines. We also took the lead in implementing the national policy requirements for tax and fee reductions, along with rent exemption or reduction. In the first quarter, costs of various market entities were reduced by 45 billion yuan. It should be said that through this concession, a healthy industrial chain ecology and a sound economic ecology have been created.

Xia Qingfeng:

Manufacturing is considered the backbone of our national economy. Central SOEs will strive to play the leading role in their respective industries and continue to work in the following three aspects, centered around the goal of ensuring every link of the industrial chain and the supply chain are in place, coordinating upstream and downstream sectors and stabilizing the industrial chain.

First, we will deepen the cooperation between upstream and downstream sectors of the industrial chain. We encourage and support central SOEs, working on market-oriented and commerce-oriented principles, to build a batch of supply and demand sharing platforms or industry resources sharing platforms that deepen cooperation among central SOEs in fields such as logistics, freight, coal and electricity price linkage. Combining national strategies and major regional development strategies, the SOEs will deeply participate in major local projects, major sectors in the distribution of productive forces and the construction of key industrial clusters so as to strengthen central and local coordination. Central SOEs will also increase cooperation with other enterprises that have ownership in the industrial chain and supply chain, and they will learn from each other in investment and equity participation, product cooperation and research and development. In these ways, we can jointly improve the stability of the industrial chain and the supply chain, rendering the industrial system more complete in range.

Second, we will speed up upgrading the industrial chain so as to make up for shortcomings. To address some of the problems exposed in the supply chain and industrial chain during the pandemic, central SOEs will accelerate transforming and upgrading these structures so as to compensate for shortcomings, close up loopholes and shore up points of weakness. In particular, the enterprises will utilize their strengths to carry out scientific and technological research and make new breakthroughs in weak fields and key areas of the industry chain. We encourage the SOEs to make good use of policies, such as the Guidelines on Promoting the Demonstration and Application of Newly-Developed Major Technological Equipment, to advance the development of locally-built key equipment. We will steadily complete mergers and acquisitions that are conducive to industrial collaboration, technology introduction, talent sharing, increasing brand value, etc., and we will strive to enhance the competitiveness and resilience of the industrial chain.

Third, we will deepen international cooperation in a more open attitude. According to statistics, over the past three years, central SOEs have invested more than 300 billion yuan overseas each year for such projects as infrastructure construction, energy resource cooperative development, capacity cooperation, technological research and development, engineering and equity investments. Central SOEs are said to have been deeply integrated into international cooperation. Upholding the concept of jointly building a community with a shared future for mankind, as proposed by General Secretary Xi Jinping, and guiding by the principle of consultation, collaboration and benefits for all, we will continue to promote business going global, keep broadening the "circle of friends," and strengthen long-term and stable cooperative relations. We will deepen international production capacity cooperation with companies from all over the world and jointly contribute to the recovery and development of the global industrial chain and supply chain. Thank you.

Xi Yanchun:

We know that central SOEs have made important contributions to epidemic prevention and control efforts. Some of the work they've done has been covered by the media, but most of their work is still unknown to the public. Therefore, I would like to take this opportunity to thank all the central SOEs that have made important contributions to the prevention and control of the pandemic. We believe that central SOEs will continue to play an important role in China's economic development. Thanks again to the two speakers, and thank you all. Today's press conference is concluded.

.

Read in Chinese

Speaker:

Wang Chunying, spokesperson and chief economist of the State Administration of Foreign Exchange (SAFE) and director general of the Balance of Payments Department at the SAFE

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office

Date:

April 17, 2020

Xi Yanchun:

Ladies and gentlemen, friends from the media, welcome to this press conference held by the State Council Information Office (SCIO). Today, we are delighted to invite Ms. Wang Chunying, spokesperson and chief economist of the State Administration of Foreign Exchange (SAFE), as well as director general of the administration's Balance of Payments Department. She will introduce China's foreign exchange receipts and payments in the first quarter of 2020 and also answer some of your questions.

Now, I'll give the floor to Ms. Wang.

Wang Chunying:

Good afternoon. Welcome to this press conference. I'll first introduce China's foreign exchange receipts and payments in the first quarter of 2020, and then I will answer some of your questions.

In the first quarter of 2020, the outbreak and spread of COVID-19 presented a major uncertainty for economic and financial performance at home and abroad. As the pandemic continues to rage around the world, downward pressure on the global economy is rising, and international financial markets have shown dramatic turbulence. 

Currently, the situation in China is continuously improving, with resumption of work and production on the fast track and economic and social activities in steady progress. Since the beginning of this year, the RMB exchange rate remained basically stable amid two-way fluctuations, and market expectations were relatively stable. China's cross-border financial flows remained generally stable, and overall balance was achieved between demand and supply in the foreign exchange market.

In the first quarter of 2020, foreign currency bought and sold by Chinese banks totaled 3.43 trillion yuan ($491.5 billion) and 3.16 trillion yuan, respectively, creating a surplus of 273 billion yuan. 

Foreign-related receipts and payments by banks on behalf of clients were worth 6.39 trillion yuan and 6.61 trillion yuan, respectively, with a deficit of 216.5 billion yuan.

China's foreign exchange receipts and payments showed the following characteristics in the first quarter of 2020:

First, overall balance was achieved between demand and supply in the foreign exchange market. In the first quarter, the surplus of foreign exchange settlement and sales by banks was $39.1 billion. If comprehensive consideration is given to factors that include forward transactions and options, the supply and demand of foreign exchange in China have reached a state of basic balance. Over the same period, foreign-related receipts and payments of foreign exchange by banks on behalf of clients produced a surplus of $1.7 billion.

Second, although foreign-related receipts and payments by banks on behalf of clients showed a deficit in March, foreign exchange settlement and sales by banks remained in surplus. Since April, overall balance has been achieved in foreign-related receipts and payments by banks on behalf of clients, as well as in foreign exchange settlement and sales. In March, the virus spread around the world, sparking more violent fluctuations in the international financial market and a plunge in major stock indexes. As a result, risk aversion was on the rise and external liquidity tightened. In this context, foreign-related receipts and payments by banks on behalf of clients showed a deficit, mainly because RMB cross-border net outflow under security investment increased. Meanwhile, the domestic foreign exchange market remained basically stable; foreign exchange settlement and sales by banks stayed in surplus; and overall balance was achieved between demand and supply in the foreign exchange market. In terms of daily data, since the beginning of April, foreign-related receipts and payments by banks on behalf of clients struck a basic balance, and foreign exchange settlement and sales by banks continued to be in minor surplus.

Third, the rate of foreign exchange buying dropped, and the forex financing of enterprises stayed generally stable. In the first quarter, the rate of foreign exchange buying, which means the ratio of clients buying foreign exchange from banks to the overseas expenditure of foreign exchange, stood at 63%, down two percentage points compared to the same period of last year. Meanwhile, the forex financing of enterprises remained stable. At the end of March, Chinese banks' forex loans at home rose by $27.7 billion. Import foreign currency and cross-border financing, such as refinancing and forward letters of credit, fell by $8 billion compared to the end of 2019, corresponding with fluctuations in the import volume of the same period.

Fourth, the rate of foreign exchange selling grew steadily, and market players showed a steady willingness to hold foreign currency. In the first quarter, the rate of foreign exchange selling, which means the ratio of clients selling foreign exchange to banks to clients receiving foreign exchange from overseas, stood at 66%, up five percentage points compared to the same period of last year. At the end of March, forex deposits of enterprises and individuals at home dropped by $6.7 billion compared to the end of 2019, remaining basically stable.

Fifth, Chinese banks maintained a forward forex settlement surplus. In the first quarter, Chinese banks reported a forward forex settlement surplus of $41.4 billion, including a surplus of $16.6 billion in March.

Sixth, China's foreign exchange reserves remained generally stable. By the end of the first quarter in 2020, the foreign exchange reserves stood at $3.06 trillion, down 1.5% compared to the beginning of this year, affected mainly by factors that include exchange rate conversion and assets price fluctuations.

These are the main Q1 forex data that I want to share with you. Now, I would like to answer questions about China's foreign exchange reserves.

Xi Yanchun:

Thanks for Mrs. Wang's introduction. Now it's time for questions. Please indicate the news organization you work for before raising your questions.

CCTV:

What do you think of the performance of the country's forex market amid the COVID-19 pandemic？What do you make of the development trend? Thanks!

Wang Chunying:

This year, the whole world faces a new situation: the COVID-19 pandemic. Both the global economic and trade activities and the international monetary market have recently been hit hard by the pandemic. Under these extreme circumstances, China's forex market has maintained overall stability, which I think is incredible. This attests to the increasing maturity of China's forex market and the growing rationality of market entities. This also attests to the market entities' confidence in China's pandemic prevention and control and the fundamentals of the Chinese economy.

In 2020, China's forex market has achieved "three keeps." First, we have kept supply and demand in balance in the forex market. Second, we have kept the yuan exchange rate relatively stable against a basket of major currencies in the world. Third, we have maintained cross-border investment and financing and forex trading in a basically sound and orderly manner. On top of that, China's foreign exchange reserves have stayed stable overall.

Let's look at the first "keep": we have kept forex supply and demand in balance. The above-mentioned data show that Chinese banks reported a relatively large forex settlement surplus of $39.1 billion, laying the basis for the balanced supply and demand in the forex market. A data breakdown shows that there is a cross-border forex surplus of $1.7 billion, and there is a net forex settlement surplus of $20.5 billion. In a word, either from the overall perspective or from the perspective of the clients, we have kept in balance the Q1 supply and demand in the forex market. The second "keep" is that we have kept the yuan exchange rate relatively stable against an array of major currencies in the world. In the first quarter, the U.S. Dollar Index rose by 2.8%. Under such a circumstance, the spot exchange rate of RMB/USD dropped slightly by 1.8%. In terms of other currencies, the currency index of the emerging markets dropped by 12.9% during the same period. The pound dropped by 6.3% against the dollar; the EUR/USD dropped by 1.6%. In the first quarter, the CFETS RMB Index rose by 2.9%. Therefore, we can conclude from the data that we have kept the yuan exchange rate relatively stable against the major currencies of the world.

Third, the behavior of market entities has remained rational and orderly, which can be seen from two perspectives. First, foreign investors' enthusiasm remains high when it comes to investing in China. According to statistics from the Ministry of Commerce, China's actual use of foreign capital in the first quarter was $31.2 billion, with a 15.5% increase in the high-tech service sector. According to statistics from the SAFE, the net increase of foreign investors' holdings of domestic bonds in the first quarter increased by 48% year-on-year, reaching $16.7 billion. Second, Chinese enterprises' outbound direct investment has been stable. According to data provided by the Ministry of Commerce, the outbound direct investment of non-financial sectors between January and February was $15.5 billion, which shows stability. Moreover, according to the SAFE data, net purchases of foreign exchange from individuals in the first quarter dropped by 25% year-on-year, reflecting individuals' rational willingness to purchase foreign exchange. Therefore, foreign exchange reserves have remained basically stable. 

The fundamentals of China's sound economic growth in the long term will ensure the stable operation of the foreign exchange market. First, the positive development of China's pandemic prevention and control measures will continue to leverage the role of stabilizing expectations and boosting market confidence. The pandemic and its implications for economic growth and societal development have been the major uncertainties for the world economy and financial markets. China is consolidating its progress in pandemic prevention and control, and resumption of production and work is ongoing. The restoration of economic and social orders has been accelerating as well, which will not only shore up confidence in the domestic market but also boost world economic development. Second, the fundamental trends of China's sound economic growth in the long term and deepened opening-up remain unchanged, which will continue to attract foreign mediums and long-term capital to invest in the domestic market. Third, the foreign exchange market is becoming more mature, and foreign exchange rates are getting more flexible. More and more "two-way volatility" of foreign exchange rates have been seen, and the performance of foreign exchange rates in regulating the macro economy and serving as an automatic stabilizer for the balance of international payments is becoming better and better. Consequently, China's foreign exchange market is mature enough to absorb and address short-term impacts, and it is capable of maintaining stable operation in the future.

Of course, in this process, we will continue to strengthen monitoring and analysis to prepare for different scenarios. We always take preventive measures, which is actually a guarantee for the smooth operation of the market. This is my response to your question. Thank you.

Economic Daily:

The SAFE has always stressed the importance of the current account. What impacts will the COVID-19 pandemic have on the current account in the balance of international payments? Is it possible to see a sustained current account deficit? Thank you. 

Wang Chunying:

The pandemic does have some impacts on China's current account of the balance of payments, and we have been conducting the following analysis on this issue. Based on the current situation, we have made some preliminary estimates of impacts that the pandemic will have on China's balance of international payments.  

First, China's current account development has been affected by the pandemic, but it will remain basically balanced in the first quarter. According to data from Customs, exports dropped by 13% in the first quarter, and imports declined by 3%. However, the decline of exports in March has slowed down, so the trade surplus in the first quarter has narrowed. In terms of services trade, according to SAFE statistics, China's deficit narrowed by 25% in January and February with a sharp dip in tourism expenditure. According to preliminary statistics, tourism expenditure remained low in March, which indicates that the services trade deficit has narrowed. China's balance of international payments is mainly composed of cargoes trade and services trade. Due to its low income and current transfers, we must analyze the development of the current account, with the analysis of cargoes trade and services trade being our priorities. China's cargoes trade surplus and services trade deficit narrowed simultaneously in the first quarter; therefore, the current account will most likely remain stable within a reasonable range.  

The second fundamental judgment is that the outbreak will not affect China's current account in the medium to long term. The pandemic develops and changes according to its own underlying rules. As scientists, biologists and pharmacologists make knowledge gains, R&D progresses, methods grow and we accrue experience, the pandemic will be effectively curbed, and the global economy and trade will gradually recover, thus easing external demand difficulties. Domestically, coordination between epidemic prevention and control and economic and social development is proceeding in an active way. According to statistics by the Ministry of Industry and Information Technology (MIIT), the work resumption rate of industrial enterprises above the designated scale had exceeded 99% by mid-April, with a 94% rate of personnel returning to their posts. With the resumption of work and production gearing up, domestic supply and demand have been secured on the one hand, and supplies for the foreign market have been secured on the other hand. Therefore, we think the outbreak will not affect the current account in the medium to long term.

The third judgment, which I mention each time, is that the defining factor affecting the current account is the domestic economic structure and other underlying and long-term factors that cannot be altered easily. First, China's manufacturing is hefty and has complete sectors, so it has a strong resilience and an ability to cope with pressure. In recent years, China has insisted on the supply-side structural reform, its industrial chains keep upgrading and manufacturing has been more competitive. Second, the domestic economic structure has constantly improved, and investment has been more efficient. Despite a drop in recent years, China's savings rate is still relatively high compared with the international level. In theory, the gap between savings and investment dictates the current account, and in this perspective, China's international current account positions can be kept basically balanced.

The current account has been kept within a balanced range. Affected by some short-term uncertain factors, it sometimes may run a small deficit or a small surplus, but it is still within a basic balance. For example, the current account surplus in 2018 fell to $25.5 billion, during which it ran a deficit for the first two quarters and then reversed to a surplus in the third quarter. The surplus later widened to $141.3 billion in 2019. However, this did not change the fact that China's current account is basically been kept balanced. Thank you.

Bloomberg News:

In March, bank foreign-related receipts and payments for customers recorded their largest deficit since January 2016. What are the main reasons causing this? How about the balance of international payments in the first quarter?

Wang Chunying:

I see you are concerned about the cross-border balance of payments in March. I have a set of data to share with you. In March, the surplus of bank foreign exchange settlements stood at $18.6 billion. The deficit of cross-border payments was $47.7 billion, which was mainly due to the net outflow of RMB. We have conducted comparative analysis and concluded that capital outflow from securities investment is the main cause of this. In March, there were net outflows of cross-border funds under the category of equities and continued net inflows under the category of bonds. However, despite the net outflow of capital in the stock market during March, capital involved in northbound trading and money invested from Hong Kong into the Chinese mainland returned to a state of net inflow, and net outflow of capital through southbound trading has also gradually stabilized. There was no sustained, one-way outflow of capital from the stock market. In fact, fluctuations of cross-border capital in the stock market under external shocks are normal reactions of the market, and changes in relative size are also within a reasonable range.

For the current account structure of the balance of international payments in the first quarter that you are concerned about, the relevant data is yet to be released and some data sources are not yet available. The data just reported are estimates based on large projects. Overall, trade in goods will still present a certain surplus, but the size of the surplus will shrink; the size of the deficit of service trade has also narrowed. The final situation will be determined once the data is compiled. The probability is that the current account balance will continue to run within a reasonable equilibrium range. Even if there is a deficit, it will not be large. There was a deficit of $40.3 billion of current account in the first quarter of 2018 and $900 million in the second quarter. Compared with the scale of international payments, the deficits will not trigger directional changes and large-scale cross-border capital outflows. The ratio of current account surplus to GDP has been basically within 2% in recent years and is now stable at around 1%, which is more balanced. Thank you. 

People's Daily Overseas Edition:

Foreign-related businesses have been greatly impacted due to the outbreak of the pandemic. What kind of measures has SAFE taken to support the resumption of work and production for enterprises? What is the current effect of such measures? Thank you. 

Wang Chunying:

Thank you for the questions. These are questions that enterprises care about. SAFE has implemented the decisions and arrangements of the CPC Central Committee and the State Council, and it took effective measures that provided great support for pandemic prevention and control as well as the resumption of work and production at enterprises. Those measures can be summarized in the following aspects:

First, it opened a "green channel" for foreign exchange business to provide support for the resumption of work and production. For example, the procedures of import payment and collection of export proceeds related to pandemic prevention materials have been simplified, and financing business related to pandemic prevention and control has been further streamlined. Meanwhile, for enterprises that are in need, quotas for borrowing foreign debts can be abolished and they can apply for registration of foreign debts online. We are also ensuring the normal use of foreign exchange by individuals and enterprises while also encouraging online foreign exchange transactions. We provide support and guidance to China Foreign Exchange Trade System and Shanghai Clearing House in reducing or exempting fees for foreign exchange transactions and clearing procedures of relevant institutions in Hubei province. From Jan. 27 to March 31, the proportion of foreign debt handled online nationwide reached 93%, compared with 61% in 2019. 

Second, we will continuously strengthen the reform and opening up of the foreign exchange sector and facilitate cross-border trade and investment. The SAFE launched 12 facilitation measures in October 2019 and raised the macro-prudential adjustment parameters for full-caliber cross-border financing in March 2020 so that companies have more freedom in acquiring foreign debts and using overseas funds. On April 14, it introduced eight other facilitation measures to streamline the foreign exchange business. In general, these facilitation measures focus on three aspects. One is to help stabilize foreign trade. The measures mainly include expanding the pilot program of facilitating foreign exchange receipts and payments in trade, facilitating foreign exchange settlement in cross-border e-commerce, and improving the reporting methods of foreign exchange business in the trading of goods. The second is to help facilitate cross-border financing. The moves include popularizing the reform to facilitate the payments of capital account income nationwide, expanding the pilot program of facilitating foreign debts to support cross-border financing of high-tech companies, and reforming the registration and administration of foreign debts of companies. The third is to improve services for the foreign exchange business. The measures mainly include facilitating the use of electronic documents in the foreign exchange business. These measures can significantly reduce the time and labor costs of companies. For example, the pilot measures for facilitating foreign exchange receipts and payments in trade saved over 50% of the time of related enterprises.

Third, we will actively use the cross-border financial blockchain service platform and other technological means to facilitate the financing of small and medium-sized enterprises (SMEs) for trade. As of April 7, nearly 3,000 companies had obtained $22.7 billion of loans through accounts receivable financing over the platform, over 75% of which were SMEs.

In the next step, we will further sort out the facilitation measures that can be introduced to help companies resume work and production as well as carry out cross-border trade, investment, and financing activities. At the same time, we will adhere to active, gradual, and controllable opening up, which means that relevant policies will not go backward. In addition, we will also actively prevent risks as we always do.

CNBC:

First, what are the trends and prospects of foreign capital inflows into China? Second, foreign investors often worry about money withdrawal when considering an increasing investment in China. Does the SAFE provide specific guarantees for that? Thank you.

Wang Chunying:

I see that one of your questions is about the recent changes and prospects of foreign investments in China, and the other is about concerns over investment withdrawal.

How has foreign investment in China changed amid the outbreak? First, medium- and long-term foreign investment, such as foreign direct investment and bond investment for the purpose of allocating medium- and long-term RMB assets, kept flowing in. On the one hand, foreign direct investment remained generally stable and well structured. According to the statistics of the Ministry of Commerce, the actual use of foreign investment by the non-financial sector in the first quarter of 2020 was $31.2 billion. Though on a year-on-year decrease, the use of foreign investment in the high-tech service sector grew rapidly, indicating that foreign investors saw the opportunities along with the transformation of the Chinese economic structure. On the other hand, bond investment for the purpose of allocating medium- and long-term RMB assets increased. Foreign investors held $16.7 billion more Chinese bonds in the first quarter in the net figure, an increase of 48%. Second, foreign investment in the stock market fluctuated slightly within a short period and a reasonable range under external shocks. There was a fall in global stock markets in general and a rise of risk-aversion emotions in the first quarter. Therefore, it is normal for some foreign investors to have reduced their investment in the stock market under the tight liquidity of the U.S. dollar. Foreign investors held around $10 billion less Chinese stocks in the first quarter in net figure, with a relatively more decrease in March compared with the other two months. The market value of the Chinese stock market ranks second in the world and registers around $7-8 trillion, among which the 10 billion accounts for a very small proportion and has had minimal influence. At the same time, the capital flow in the stock market fluctuated in both directions, which showed that the decrease did not last. The northbound investment to Chinese mainland through Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect showed net outflows in mid-March and turned into net inflows in late March, so in our view, the investment has changed within a reasonable range.

Where the prospect of investment is concerned, we believe that in the future, Chinese market and RMB assets will still be rather attractive to foreign capital. This is because China's economic fundamentals for long-term growth remain unchanged, and China also has huge potential in its domestic market. Additionally, China has made positive progress in domestic pandemic prevention and control, which greatly contributes to global economic development. Considering direct investment, in the past four years, foreign direct investment (FDI) across the world has seen a continuous decline. Against this backdrop, the scale of foreign investment in China keeps rising, and China remains the world's second-largest country in attracting foreign investment. It shows the long-term strong interest of foreign investors in doing business in China. In terms of investment in bonds, the yields of bonds in China are very high. This is very attractive to investors who allocate RMB assets in the medium and long term. From the perspective of the stock market, the actual valuation of China's stock market is relatively low, and the prospect of value investing is quite promising in China. For example, compared with the rest of the world, the stock market in China is less volatile. In the first quarter, the Dow Jones industrial average was down 23%, whereas the volatility of the Shanghai Composite stayed within 10%. Therefore, China's market remains attractive to foreign investors from the three aspects of direct investment, bond investment, and stock investment. We always welcome foreign investors to invest in China and share in the dividends of China's economic development.

I'd also like to talk about the security of funds, as you mentioned earlier. As a matter of fact, since 1996, China has already realized the convertibility of current accounts. This means that all the incomes and expenses under the current accounts, as long as they are real and compliant, will be processed at banks with the legitimate documents. As for capital accounts, according to the 40 standards of the International Monetary Fund in seven major categories, China already keeps a high level of openness. Also, we have been making efforts on the reform of investment facilitation. As I said just now, our reform efforts are always proactive, progressive and controllable. This means that we will not "go backward." This is why we say that windows will not be closed once opened. Therefore, investors should no longer be worried about this issue.

Hong Kong Economic Herald:

The COVID-19 pandemic has caused liquidity tension of the U.S. dollar, and this problem hasn't been completely solved to this point. As China's balance of foreign debt has exceeded $2 trillion, will there be deleveraging on foreign debt? Thank you.

Wang Chunying:

Based on the current situation, the risk of significant deleveraging on China's foreign debt is relatively small. First, the growth of China's foreign debt has been comparatively stable in recent years. Here are some statistics for your reference. By the end of 2019, the balance of foreign debt reached $2.06 trillion, which was $277.4 billion more than the historical peak figure at the end of 2014. Although the absolute amount has increased, the relative increase of foreign debt is not high when compared to the economic growth in recent years. At the end of 2019, the balance of foreign debt stood at 14.3% of the GDP that year, whereas the ratio at the end of 2014 was 17%. Therefore, this ratio was down by more than two percentage points. In addition, as the foreign debt increased in recent years, China's external assets also rose. Therefore, we have made comparisons regarding the scale of foreign debt and external assets. By the end of 2019, this ratio was 26.7%, which is a decrease of 0.1 percentage point from the end of 2018 and a decrease of one percentage point by the end of 2014. This means that since deleveraging in 2015 and early 2016, the growth of China's foreign debt has been fairly stable. It is consistent with our economic growth, and it also matches China's openness to the rest of the world. In the meantime, during this period, the exchange rate of RMB has remained basically stable and fluctuated in both directions. There is no procyclical leveraging on China's foreign debt; thus, the risk of significant deleveraging in this field is relatively small.

Second, our external debt structure has been further optimized. For example, at the end of 2019, the external debt in domestic currency accounted for 35% of total external debt. This was two percentage points higher than in 2018, and the proportion of medium-and long-term external debt had steadily increased from 35% to 41%. Benefitting from China's interbank bond market, foreign investors purchased more domestic bonds than before, accounting for 26% of the total external debt in late 2019, which was up from 8% in late 2014. The investors have been mainly foreign central banks. These institutions and sovereign wealth funds chose to invest in Chinese bonds out of demand for medium-and long-term allocation of RMB assets. They are inherently stable and are not angling for short-term gains. In addition, China's debt ratio, foreign debt ratio and debt service ratio are all within the internationally recognized safety margins and are much lower than the overall level of developed countries and emerging markets.

We saw external debt deleveraging in 2015 and 2016 when the dollar interest rates and foreign exchange rate rose due to the Federal Reserve's hike of interest rates. Now, with the Fed adopting an easy monetary policy, the short- and long-term interest rates of the U.S. dollar continuing their downwards movement, and the RMB exchange rate remaining generally stable, it is unlikely that a large-scale deleveraging of external debt will reoccur.

Preliminary data from the first quarter shows that our registered external debt steadily increased, foreign investors increased their holding of China's domestic bonds, and there was no evidence of deleveraging. Thank you.

Xi Yanchun:

Thank you again Ms. Wang, Thank you all. Today's press conference is hereby concluded. 

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Read in Chinese

Speaker:

Mao Shengyong, director general of the Department of Comprehensive Statistics at the National Bureau of Statistics (NBS) and NBS spokesperson

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office of China

Date:

April 17, 2020

Xi Yanchun:

Ladies and gentlemen, friends from the media: Welcome to this press conference held by the State Council Information Office (SCIO). Today, we will brief you on the national economic performance in the first quarter of 2020. As known to all, the first quarter of this year is a relatively special one, because this is a quarter in which we faced the severe challenge of the COVID-19 pandemic, and it is also a quarter in which we coordinated efforts for pandemic prevention and control and economic and social development. We have invited Mr. Mao Shengyong, a spokesman for the National Bureau of Statistics (NBS), to brief you and take questions from media friends.

I will now give the floor to Mr. Mao.

Mao Shengyong:

Thank you. Ladies and gentlemen, friends from the media, good morning. As usual, I will first share with you the basic information on national economic performance in the first quarter, and then I will answer your questions.

Coordinative efforts for pandemic prevention and control and economic and social development have delivered notable results, and the decline of major economic indicators has been significantly narrowed down in March.

In the first quarter, faced with the severe test of the COVID-19 outbreak, 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, and the whole nation coordinated efforts to advance both the prevention and control of the disease and the economic and social development of the country. As a result, the situation of pandemic control and prevention continued to improve with a basic interruption in virus transmission at home. The resumption of work and production accelerated, with fundamental industries and major products vital to the national economy and people's livelihoods growing steadily. People's basic livelihood was well guaranteed, and national economic and social development reached overall stability. 

According to the preliminary estimates, the gross domestic product (GDP) of China was 20.65 trillion yuan in the first quarter of 2020 — a year-on-year decrease of 6.8% at comparable prices. By industry, the value-added of the primary industry was 1.02 trillion yuan, down by 3.2%; that of the secondary industry was 7.36 trillion yuan, down by 9.6%; and that of the tertiary industry was 12.27 trillion yuan, down by 5.2%. 

First, overall agricultural production was steady and the grain grew well. 

In the first quarter, the value-added of agriculture (crop farming) grew by 3.5% year-on-year. With currently favorable climate conditions in major farming areas, spring plowing and sowing went smoothly, and winter wheat grew better than last year and average years. By the end of March, the sown area of gradeⅠand gradeⅡseedlings of winter wheat accounted for 87.2% of the total, 3.5 percentage points higher than that of the same period last year. In the first quarter, the output of eggs grew by 4.3%, and that of milk grew by 4.6%. The output of pork, beef, mutton and poultry was 18.13 million tons. The pig production capacity continued to recover. By the end of the first quarter, 321.2 million pigs were registered in stock — up by 3.5% over the end of the fourth quarter of 2019 — among which 33.81 million were breeding sows, up by 9.8%. 

Second, industrial production fell while the industry of basic raw materials and high-tech manufacturing continued to increase. 

In the first quarter, the total value-added of the industrial enterprises above the designated size went down by 8.4% year-on-year. Specifically, in March, the total value-added of the industrial enterprises above the designated size went down by 1.1% year-on-year, or 12.4 percentage points slower than the decline of the first two months, while the month-on-month growth was 32.13%, with the industrial output approaching the level of the same period last year. An analysis by types of ownership showed that the value-added of the state holding enterprises dropped by 6% year-on-year; that of share-holding enterprises fell by 8.4%; that of enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan was down by 14.5%; and that of private enterprises was down by 11.3%. In terms of sectors, the value-added of mining went down by 1.7%, manufacturing fell by 10.2% and the production and supply of electricity, thermal power, gas and water was down by 5.2%. The production of basic raw materials and new products maintained growth. The output of natural gas, non-woven fabrics, chemical medicine materials, crude oil, 10 kinds of nonferrous metal, ethylene and crude steel went up by 9.1%, 6.1%, 4.5%, 2.4%, 2.1%, 1.3% and 1.2%, respectively. The output of automatic vending and ticket machines, electronic components, integrated circuits, urban rail vehicles and solar cells went up by 35.3%, 16.2%, 16.0%, 13.1% and 3.4%, respectively. In March, high-tech manufacturing went up by 8.9% year-on-year, and this includes the manufacturing of computers, communication equipment and other electronic equipment, which collectively went up by 9.9%. The output of industrial robots and power generation equipment went up by 12.9% and 20.0%, respectively. 

Third, service production dropped while the emerging service industry grew.

In the first quarter, the total value-added of the tertiary industry dropped year-on-year, while that of the information transmission, software and information technology services and that of financial intermediation went up by 13.2% and 6.0%, respectively. In March, the Index of Services Production dropped by 9.1%, 3.9 percentage points slower than the decline of the first two months. In the first two months, the business revenue of service enterprises above the designated size dropped by 12.2%; this includes that of internet and related services and that of software and information technology services, which went up by 10.1% and 0.7%, respectively. In March, the Business Activity Index for services was 51.8%, 21.7 percentage points higher than last month. Specifically, the Business Activity Index for transportation, storage and post, retail trades and monetary and financial services was relatively high, reaching 59.3%, 60.6% and 62.9%, respectively. In terms of market expectation, the Business Activities Expectation Index for services was 56.8%, which is 17.1 percentage points higher than last month, showing greater confidence of enterprises in market development.

Fourth, market sales decreased while sales of daily necessities and online retail sales of physical goods grew fast.

In the first quarter, the total retail sales of consumer goods reached 7,858 billion yuan, down by 19.0% year-on-year. In March, the total retail sales of consumer goods reached 2,645 billion yuan, down by 15.8%, a decline narrowed by 4.7 percentage points compared to that of the first two months of the year. The retail sales of goods went down by 12.0%, a decline that has narrowed by 5.6 percentage points compared to that of the first two months of the year. Analyzed by different areas, the retail sales in urban areas in the first quarter reached 6,785.5 billion yuan, down by 19.1%, and the retail sales in rural areas stood at 1,072.5 billion yuan, down by 17.7%. Grouped by consumption patterns, the income of catering was 602.6 billion yuan, down by 44.3%; and the retail sales of goods amounted to 7,255.3 billion yuan, down by 15.8%. Commodities closely related to people's lives witnessed growth. The grain, oil and food, beverages and traditional Chinese and Western medicines produced by businesses above the designated size grew by 12.6%, 4.1% and 2.9%, respectively, or 2.9 percentage points, 1.0 percentage point and 2.7 percentage points higher than the growth in the first two months. Online retail sales reached 2,216.9 billion yuan, down by 0.8% year-on-year. Specifically, the online retail sales of physical goods were 1,853.6 billion yuan, up by 5.9% and 2.9 percentage points higher than that of the first two months of 2020, accounting for 23.6% of the total retail sales of consumer goods, which is 2.1 percentage points higher than that of the first two months.

Fifth, investment growth slowed down while e-commerce, professional technical services and anti-epidemic related industries saw growth.

In the first quarter, the investment in fixed assets (excluding rural households) reached 8,414.5 billion yuan, down by 16.1% year-on-year and 8.4 percentage points slower than the decline of the first two months of 2020. Specifically, the investment in infrastructure, manufacturing and real estate development declined by 19.7%, 25.2% and 7.7%, respectively, which amounts to 10.6 percentage points, 6.3 percentage points and 8.6 percentage points slower than the decline of the first two months of the year. The floor space of commercial buildings sold reached 219.78 million square meters, down by 26.3%, and the total sales of commercial buildings were 2,036.5 billion yuan, down by 24.7%, the decline of which was narrowed by 13.6 percentage points and 11.2 percentage points compared to that of the first two months of the year, respectively. By industry, the investment in the primary industry went down by 13.8%; the secondary industry went down by 21.9%; the tertiary industry fell by 13.5%; and the private investment sector reached 4,780.4 billion yuan, down by 18.8%. The decline was narrowed by 11.8 percentage points, 6.3 percentage points, 9.5 percentage points and 7.6 percentage points, respectively, compared to that of the first two months. Investment in high-tech industry declined by 12.1%, which is 4.0 percentage points slower than that of the total investment. Of the total, the investment in high-tech manufacturing and high-tech services went down by 13.5% and 9.0%, respectively. In terms of high-tech manufacturing, investment in the manufacturing of computers and office equipment grew by 3.2%. In terms of high-tech services, investment in e-commerce services went up by 39.6%, investment in professional technical services went up by 36.7 %, and investment in services for commercialization of research findings rose by 17.4%. Investment in social sectors went down by 8.8%, and investment in the health sector dropped by 0.9%, or 15.2 percentage points slower than the decline of the total investment. Investment in manufacturing of biological medicines, products and other anti-epidemic related industries maintained growth, and construction of key projects for epidemic prevention accelerated. In March, investment in fixed assets (excluding rural households) grew by 6.05% month-on-month.

Sixth, imports and exports of goods slowed down and trade structure continued to optimize.

In the first quarter, the total value of imports and exports of goods was 6,574.2 billion yuan, which is down by 6.4% year-on-year. In March, the total value of imports and exports was 2,445.9 billion yuan, down by 0.8% year-on-year, which is a decline that slowed by 8.7 percentage points compared to that of the first two months of the year. Of the total, the value of exports was 1,292.7 billion yuan, down by 3.5%, and the value of imports was 1,153.2 billion yuan, up by 2.4%, with imports of general trade growing by 4%. In the first quarter, the total value of exports was 3,336.3 billion yuan, down by 11.4%; the total value of imports was 3,238.0 billion yuan, down by 0.7%. The trade balance was 98.3 billion yuan in surplus. The trade structure continued to optimize. The import and export of general trade accounted for 60% of the total value of imports and exports, an increase of 0.4 percentage points compared to the same period last year. In the first quarter, the export delivery value of industrial enterprises above the designated size reached 2,408.2 billion yuan, down by 10.3% year-on-year and 8.8 percentage points slower than the decline of the first two months of 2020. In March, the export delivery value of industrial enterprises above the designated size reached 1,030.7 billion yuan, which is up by 3.1%.

Seventh, the rising of consumer prices declined and producer prices for industrial products saw a larger drop.

In the first quarter, consumer prices went up by 4.9% year-on-year. In March, consumer prices went up by 4.3% year-on-year, 0.9 percentage points lower than in February, or down by 1.2% month-on-month. In the first quarter, prices went up by 4.6% in urban areas and by 5.9% in rural areas. Grouped by commodity categories, prices for food, tobacco and alcohol went up by 14.9% year-on-year; clothing went up by 0.2%; housing went up by 0.2%; articles and services for daily use went up by 0.2%; transportation and communication went down by 1.5%; education, culture and recreation went up by 1.9 %; medical services and health care went up by 2.2%; and other articles and services went up by 4.9%. In terms of food, tobacco and alcohol prices, prices for grain went up by 0.6%; fresh vegetables went up by 9.0% — specifically, their prices went up by 10.9% in February and down by 0.1% in March; pork went up by 122.5% — specifically, its prices went up by 116.4% in March, which is 18.8 percentage points lower than in February. Core CPI, excluding the price of food and energy, went up by 1.3%.

In the first quarter, producer prices for industrial products went down by 0.6% year-on-year. Specifically, prices in March dropped by 1.5% year-on-year, which is 1.1 percentage points faster than the year-on-year decline in February this year, or down by 1.0% month-on-month. In the first quarter, purchasing prices for industrial products went down by 0.8% year-on-year. In March, prices dropped by 1.6% year-on-year, or by 1.1% month-on-month.

Eighth, the surveyed unemployment rate in urban areas dropped slightly while employment was generally stable.

In the first quarter, the newly increased number of employed people in urban areas totaled 2.29 million. In March, the surveyed unemployment rate in urban areas was 5.9%, 0.3 percentage points lower than that of February. Specifically, the surveyed unemployment rate of members of the population aged from 25 to 59 was 5.4%, 0.5 percentage points lower than the surveyed unemployment rate in urban areas and 0.2 percentage points lower than that of last month. The urban surveyed unemployment rate in 31 major cities was 5.7%, which is the same as last month. In March, the employees of enterprises worked an average of 44.8 hours per week, which is 4.6 hours more than last month. By the end of February, the number of rural migrant workers reached 122.51 million.

Ninth, residents' nominal income increased while real income decreased and the per capita disposable income ratio between urban and rural households dropped slightly.

In the first quarter, the nationwide per capita disposable income of residents was 8,561 yuan, a nominal increase of 0.8% year-on-year, or a real decrease of 3.9% after deducting price factors. In terms of permanent residences, the per capita disposable income of urban households was 11,691 yuan, a nominal increase of 0.5%, or a real decrease of 3.9%. The per capita disposable income of rural households was 4,641 yuan, a nominal increase of 0.9%, or a real decrease of 4.7%. By sources of income, the nationwide per capita wage income went up by 1.2% year-on-year in nominal terms, net operating income went down by 7.3%, net property income went up by 2.7%, and net transfer income went up by 6.8%. The per capita disposable income of urban households was 2.52 times that of the rural households, a reduction of 0.01 than that of the same period last year. The median of the nationwide per capita disposable income was 7,109 yuan, down by 0.7%.

Generally speaking, the overall national economic and social development in the first quarter remained stable despite the outbreak of COVID-19. However, we should also be aware that given the continuous spread of the pandemic, the mounting downward pressure of the world economy, and remarkably increasing instabilities and uncertainties, we are now facing increasing pressure related to the prevention of imported infections and new difficulties and challenges for resuming work and production while continuing to promote economic and social development.

For the next step, we must fully implement the decisions and arrangements made by the CPC Central Committee and the State Council, further coordinate efforts to advance both epidemic prevention and control and economic and social development and enhance policy implementation to resume work, production, market function and business. We must guarantee and improve people's livelihoods and accelerate the full restoration of productivity and living order under the normalization of epidemic prevention and control measures, thereby ensuring a decisive victory in building a moderately prosperous society and achieving poverty alleviation goals. Thank you.

Xi Yanchun:

Thank you, Mr. Mao. Now the floor is open for questions. Please identify your news outlets before asking questions.

CCTV:

According to statistics you've just released, economic growth apparently slumped in the first quarter of this year, and the decline of most indicators narrowed to a great extent in March. Under the complex economic circumstances both at home and abroad, what are your comments on the economic situation in the first quarter and its trend in the next phase? Thank you.

Mao Shengyong:

Thank you for your question. Based on the newly released statistics and my introduction, the outbreak of COVID-19 had a great impact on China's economic operation. In the first quarter of 2020, all economic indicators slumped, but we also noted that the main indicators showed recovery momentum in March, and the decline narrowed sharply. At the same time, we must take into account that, despite the impact of the pandemic, basic industry has maintained a normal level of increase; the supply of pandemic prevention commodities and daily necessities has been guaranteed; the livelihoods of 1.4 billion people have been guaranteed, and the overall social situation has been stable.

The statistics had the following prominent characteristics:

First, primary economic indicators improved in March. As pandemic prevention and control measures have continuously taken effect and the resumption of work and production has been accelerated, the decline of main economic indicators — including industries, services, investments, total retail sales of consumer goods, imports and exports — narrowed sharply in March, showing signs of improvement. For example, the value-added of industrial enterprises above the designated size grew by 8.5% year-on-year in March last year, the highest growth speed among 12 months of last year. In March of this year, the value-added of industrial enterprises above the designated size decreased by 1.1%, which is 12.4 percentage points slower than the decline of the first two months. The output of industrial enterprises above the designated size in March returned to the level of the same period last year. In March, as for 41 industries, 90% of the value-added increased faster than that of the first two months and 40% realized year-on-year growth. As for the output of statistically more than 600 main industrial products, 40% of them realized year-on-year growth. Therefore, statistics showed that the restoration of industrial production has taken effect, and the other related indicators displayed similar characteristics. 

Second, employment and commodity prices were generally stable. With the restoration of production and normal life, the overall employment situation was stable. In March, the surveyed unemployment rate in urban areas was 5.9%, 0.3 percentage points lower than that of February. The surveyed unemployment rate of members of the population aged from 25 to 59 was 5.4%, 0.2 percentage points lower than that of last month. We can see that, despite the impact of the pandemic, there was no large-scale unemployment across China, and the employment situation was generally stable. As for commodity prices, the growth of the CPI declined in March. The CPI went up by 4.3% year-on-year in the month, 0.9 percentage points lower than February, and down by 1.2% month-on-month. It grew by 0.8% in February month-on-month. In the first quarter, the consumer price index went up by 4.9% year-on-year, which is 0.4 percentage points lower than that of January and February. What does this mean? The main reason behind the decline of CPI growth was the decline of food price growth, especially the year-on-year decline of pork price growth and its month-to-month decline. The results showed that the food supply was sufficient, and the logistics chain was smooth.

Third, industrial upgrading developed continuously. During the period of pandemic prevention and control, overall production capacity, including the matching capacity of the whole industry, was fully developed. Against the backdrop of a severe pandemic, the industry was not seriously impacted, and the new drivers represented by new industry, products and business models grew against the trend. In March, high-tech industry went up by 8.9% year-on-year, which is 20 percentage points higher than that of January and February. 3D printing equipment, mono-crystal silicon, polycrystalline silicon and smart watch kept developing rapidly. The economic performance related to the internet, e-commerce, online learning and long-distance inquiry was energetic and realized speedy development. The value of online physical commodity retail sales increased by 5.9% in March, accounting for 23.6% of the total retail sales of consumer goods, or 5.4 percentage points higher than that of last year. From the perspective of added value, the value-added of information transmission, software and IT services increased by 13.2% in the first quarter, contributing to the growth of GDP by 0.6 percentage points. The financial industry grew by 6%. Therefore, though the pandemic was daunting, the rapid growth of new drivers was not changed.

Fourth, stable progress has been made in terms of poverty-alleviation tasks. The CPC Central Committee has attached supreme importance to the poverty-alleviation work and funded 139.6 billion yuan during the first quarter of this year that will trickle down to the needy population. So far, construction has begun on more than 260,000 poverty reduction projects in 22 provincial-level regions in central and western parts of the country. Meanwhile, average personal disposable incomes in Sichuan, Guangxi, Tibet, Guizhou and Qinghai, where the size of the destitute population is larger than in other parts of the country, grew nominally by 5.3%, 4.6%, 9.5%, 4.8% and 3.1%, respectively, with each registering a rate above the national average.

Fifth, the momentum of rebound is expected to continue. Electricity consumption, considered one of the most important indicators, registered a decline in March that was far narrower than in the prior month. Nationwide electricity consumption and generation rebounded, and have kept rising since the end of March. Moreover, China's total electricity generation in early April was observed with positive growth. According to the National Bureau of Statistics, the first quarter of 2020 saw 11,477 investment projects -- estimated above 50 million yuan each -- in its database, an increase of 144 in number year on year. Sales of excavators grew by 11.6% year on year in March. Meanwhile, imports and exports have significantly improved compared to the first two months, and in March alone, the performance has been constantly refined. More to the point, based on our investigations and researches, imports and exports kept on ameliorating in early April, following a slew of policies devised to assist enterprises to surmount financial woes and help resume work and production, and these efforts continue to pay off

In our next phase, stronger policies will be rolled out in response to changing situations. It is foreseeable that the economy will continue to rebound, to improve and to secure sound momentum. Thank you.

South China Morning Post:

Based on your prediction, given that the data released on the first quarter reflected a considerable impact caused by the coronavirus pandemic, will the second quarter mark the tipping point of China's economy? Moreover, will China abrogate setting a specific GDP growth target this year? How will you respond to the International Monetary Fund (IMF)'s latest forecast in which the economic growth in China is estimated to plummet to 1.2% this year? Thank you.  

Mao Shengyong:

I would like to answer the third question first. Recently, with the spread of the pandemic and the performance of the global economy, the IMF has substantially lowered its growth forecast, indicating that the world economy may contract by 3% on average. However, China, estimated to maintain a 1.2% growth, is among the few major economies to continue developing with positive growth. Meanwhile, I have also noted that the IMF forecasts China's economy to grow by 9.2% in 2021. The growth, from my point of view, will still average out at above 5% for the two years combined. We can also consider that next year, the Chinese economy will better unleash its activities and compensate losses incurred by the pandemic.

Regarding whether the tipping point will emerge in the second quarter, economic operations greatly improved in March compared to the prior two months, providing a fundamental judgment. The momentum of sound economic recovery in March can be continued, as the basic trend in the economy can play a much better role in the second quarter with the adoption of more influential policies as well as the efficient and orderly resumption of work and production. In addition, if the pandemic can be effectively controlled around the world, the economy in the next half-year should be better than it was in the first half. Our goal is to secure smooth economic operations and social stability throughout the year.

Regarding your concern about the annual growth target, this is always released by the government work report that is delivered during the two sessions (the annual meetings of the National People's Congress and the National Committee of the Chinese People's Political Consultative Conference). To better control the pandemic, the sessions have been postponed this year. As a result, we know nothing specific about the rate right now. Thank you. 

Bloomberg:

I also have two questions. First, manufacturers that resume work after the outbreak may be forced to halt production again due to weak demand, rising costs and difficulty in funding and logistics, according to an industry ministry official who was speaking yesterday. Considering that, companies are having to shut down again because of clearly weak export demand and also the dire picture of retail sales and consumption that we saw in the data today. Can growth actually rebound in this quarter? And what will be the driver for that growth? My second question is regarding consumption vouchers, which are being discussed. Their use in places like Taiwan and Japan in the past has had some impact, but the multiplier hasn't really been that high. What is your hope for the multiplier of consumption vouchers? And do you think that will be a strong driver for retail sales and consumption? Thank you.

Mao Shengyong:

Thank you for your question. These two questions are very good. Regarding the first one, in the process of resuming work and production, enterprises may still face difficulties, such as rising logistics costs and reduced orders. Objectively speaking, the current progress of resuming work and production is relatively smooth. The resumption of work and the production of enterprises above the designated size is getting close to 100%, which means essentially all large enterprises have resumed work. At the same time, the resumption of work and production of small and medium-sized enterprises (SMEs) is better than expected, generally speaking, as more than 80% have resumed work. Therefore, the progress of enterprises resuming work and production is generally going well.

The logistics cost you mentioned is actually declining compared to that of previous periods, because production and overall livelihood are gradually being restored. And logistics are smoother in general. However, we must also see that, since the current external situation is more complicated and domestic demand is generally weak, enterprises do still face difficulties in insufficient demands and declined orders. In response to such difficulties, we introduced a series of policies in the earlier stages of the outbreak to help enterprises overcome difficulties, including further tax and fees reduction, and to reduce all aspects of costs for enterprises, including reductions and deferrals, as well as the reduction of social insurance premiums, etc., to increase capital support for enterprises, in turn helping them resume production.

However, we must add that because the current market environment is still relatively complex, enterprises are still facing many difficulties. In the next stage, policy will be further strengthened, and the accuracy of that policy will also be improved.

Regarding the growth of total retail sales volume of social consumer goods you mentioned, in fact, looking at the first quarter, we can see that total retail sales of social consumer goods declined, and the decline was relatively significant. However, looking at what happened in March, we see the resumption of work and production, and the resumption of businesses, and the markets are all progressing. The decline of market sales in March has narrowed significantly compared to the declines in January through February. But the whole first quarter showed a downward trend. In the next stage, as the orders of production and people's lives gradually return to normal, some consumption behaviors suppressed in the previous months will be compensated to some extent in the later periods, and consumption will gradually stabilize and rebound. This is the answer to your first question.

Your second question concerns the consumer vouchers you mentioned. Some countries and regions have introduced these policies, and some local governments in our country have also tried such policies. From the perspective of Zhejiang, Jiangsu and other places, we can see that after the introduction of consumer voucher policies, they have played a relatively good role in expanding the consumption of local residents and promoting market vitality. Thank you.

CNBC: 

Was the negative economic growth in the first quarter of 2020 affected by the spread of the COVID-19 pandemic? In terms of consumption, has internet influencer marketing been impacted? Finally, what are the challenges to employment? What is the current situation in March and April? Thank you.

Mao Shengyong:

Thank you for your questions.

To the first question, the impact of the pandemic is indeed obvious, and it is hard to get a quantitative calculation. This is because some of the impacts are direct, some may be indirect, some are short-term and some may be long-term. A hard hit now may get recovered later, as China's economy is relatively resilient, so any specific quantitative calculation is still difficult. 

My second answer relates to consumption and internet influencer marketing. In the next step, we need to boost domestic demand to promote the smooth running of China's economy, which is based on stable foreign trade and investment at the same time. We should invest more and unleash consumer potential to promote domestic demand. China has huge consumer potential, but with the current spread of COVID-19, people cut their spending. Furthermore, consumer potential will be gradually tapped; for example, we will see new consumption patterns growing quickly and an effort to target online shopping. On the whole, the curb on consumption seen in early stages will be lifted in later stages, with new consumption types functioning actively.

To the third question, I'll address employment challenges. Statistics show China's overall employment situation is stable, with an unemployment rate in March that decreased by 0.3% and the main labor force group (aged 25-59) showing a 0.2% drop compared to last month. However, we still face relatively great pressure, especially in the stages with the increasing downward pressure of the economy, decreased orders from enterprises and lessened demand. In this case, rural migrant workers and college students are the key groups who are under relatively big pressure. In response to this situation, China has introduced employment priority policies, which have been implemented with concerted effort. On the one hand, our country is doing everything possible to help enterprises weather difficulties and maintain a balanced employment rate. On the other hand, we should assist key groups; for example, we should increase training for migrant workers and help them return home to start their own businesses. Next, we should continue to promote innovation in employment and business startups in a flexible way. Generally speaking, greater efforts should be made to advance the overall employment balance. The situation in March and April stands as such: In March, the employment situation was obviously rising and improving, and this trend should continue in April. Thank you.

China National Radio (CNR):

We have noticed that the added value of the primary industry dropped 3.2%. What is the cause of this? And does it have negative implications for the agriculture sector? Many people have begun stockpiling grain. Is this necessary? Thanks.

Mao Shengyong:

Thanks for your questions. The decrease in the added value of the primary industry is mainly attributed to the slow course of animal husbandry. As we all know, due to the African swine fever, hog production has seen a year-on-year decrease despite monthly increases. Hence, the pork production in Q1 decreased 29.1% compared to the same period last year. The epidemic has also affected livestock and poultry production, causing a decrease of 10.6% on animal husbandry's total output value. In Q1, the output of animal husbandry accounted for 45% of the entire primary industry, so its slowing drove down the growth of the added value of the primary industry. 

Second, agriculture production now goes well. As it stands, spring plowing and planting has proceeded in an orderly fashion, essentially unaffected by the epidemic. Winter wheat, which accounts for more than 90% of the total summer crops, is growing well. According to a survey, the sown areas in many granary provinces maintain continuous growth, reversing a multi-year trend of decline. In addition, the advantageous conditions and situation for agriculture production provide favorable conditions for this year's grain harvest. 

Third, the current grain price is generally stable. As we all know, the yearly grain output has surpassed 650 billion kilograms in the past five years, reaching a record high in 2019. Currently, the self-sufficiency rate of grain in China is quite high, and we have an abundant stockpile. Therefore, from the perspective of supply and demand, the grain price remained stable in the first quarter despite the large impact of the epidemic. Even in hard-hit places, including Wuhan, there was no major fluctuation in prices. The grain price in Q1 increased 0.6% year on year, and the price in March grew 0.7% compared to the same period last year. Both are modest increases, and the monthly increases are even. It indicates that China has strong grain supply capacity and the supply-demand relationship is generally stable. Therefore, the country is fully capable of feeding its people. 

Fourth, in terms of animal husbandry, livestock production is improving, especially hog production. Along with the further resumption of work and production and the implementation of supportive policies, hog production is being resumed and greatly improving. By the end of Q1, pig stocks grew 3.5% compared to the end of last year, and the number of breeding sows increased 9.8%, maintaining growth for two consecutive quarters. Therefore, the entire animal husbandry sector is speeding up resumption and improvement. Thank you. 

Financial Times: 

I have two questions. First, will the economic downturn in the first quarter of 2020 have an impact on achieving this year's goal of building a moderately prosperous society in all respects? And will the gross domestic product (GDP) of 2020 double that of 2010? The second question is about the economic growth criteria. Some experts have mentioned the concept of relative economic growth before. Do you think we should abandon the current economic growth target? Thank you.

Mao Shengyong:

Thank you for your questions. The growth rate in the first quarter of this year needs to be viewed objectively. We cannot simply compare this year's economic growth with that of a conventional year due to the outbreak of COVID-19 and the considerable impact it will produce this year. We need to look at the Q1 economic growth with a calm mind.

First, we need to take into account the severe impact of the pandemic. The novel coronavirus disease epidemic is a major public health emergency that has spread the fastest, caused the most extensive infections and been the hardest to contain since the founding of the People's Republic of China in 1949. Facing such a severe epidemic, the CPC Central Committee has been putting people's safety and health as the top priority. A variety of forceful prevention measures have been put in place. The epidemic transmission was contained in a relatively short period, which prevented millions more from being infected and saved the lives of many Chinese people. Nevertheless, the price of achieving this was short-term economic loss.

Second, we need to consider the backdrop wherein the global economy and trade have declined sharply. As the pandemic has spread to more than 200 countries and regions worldwide, global cross-border investment, trade in goods and personnel exchange has fallen sharply. Some countries and institutes have lowered their growth forecast. China can hardly stand aloof against such a backdrop.

Third, we need to look at the advantages of China's entire industrial system. China's strong industrial production capacity, as well as its supporting facilities that are in an advantageous place, played a unique role in epidemic prevention and control. Meanwhile, such capacity has been further consolidated and enhanced over the course of the epidemic rather than being damaged by it. Despite a slowdown in growth, the industrial system as a whole was not impacted and neither was the entire production capacity. China has a sound social production system and ample production capacity. When the economy recovers, the capacity will release gradually.

Fourth, we need to see that the long-term upward trend of China's economy has not changed. The epidemic is a public emergency. The basic conditions and factors supporting China's long-term economic growth have not changed. The Chinese market is large and growing rapidly with great potential. Such fundamental characteristics will not change. In light of supporting factors, China has a sound industrial foundation with a strong supporting capacity and an ample labor force of constantly accumulating human capital as well as efficient logistics and transportation facilities, which will effectively support its medium- and long-term economic growth. Meanwhile, China will continue to deepen reforms and opening up and promote innovation to unleash the driving force, the potential and vitality of the economy. Therefore, the fundamentals of China's economy that is on a long-term upward trend will not change over the course of the short-term impact incurred from the epidemic. China's GDP in Q1 dropped 6.8 percent year on year. We need to consider this information with a calm mind, taking into account fundamental factors, including the impact of the epidemic, changes to the external environment and the advantages of China's own industrial system that is on a long-term upward trend. 

With regard to the goal of building a moderately prosperous society in all respects, one of the two centenary goals set out at the 18th CPC National Congress, China has basically achieved the goal on the whole after years of sustained economic and social development. Of course, there are still some shortcomings, the biggest of which is poverty alleviation. So, the focus of the entire Party and the whole country is to set itself on a course that will lead to winning the battle against poverty. As we make progress and win battles, the goal of building a moderately prosperous society in all respects will be better achieved. Such a society will be of better quality, more amenable to the test of history and more satisfying to the people.

Speaking globally, the Chinese economy fared slightly better in the IMF's forecasts. But the world has been affected and impacted by the COVID-19 pandemic on the whole. This shows that the world is indeed a global village and a community with a shared future for humanity, and the virus is the common enemy of all humanity. In this instance, the world needs to step up international cooperation to contain the epidemic as soon as possible by improving development and research in order to find solutions. In this way, we can get the world economy back on track at an early date. Thank you.

BBC:

I noticed the headline of today's press conference is about notable progress in coordinating epidemic prevention and control and economic and social development. You mentioned just now that falls in many economic indicators has been narrowing, and the effect of resuming production and work is obvious. We know that all governments are willing to emphasize what has been achieved. However, looking at the worst data released on this report, how big of an effect do you think these numbers will have?

Mao Shengyong:

Thank you. This is a very challenging question. We just introduced lots of data. Generally speaking, economic indicators have dropped a lot in the first quarter due to the epidemic outbreak. But at the same time, this trend has improved remarkably in March thanks to a series of policies. This is a conclusion drawn from key data.

The biggest domestic challenge, as you mentioned, is working hard to help enterprises. We will enhance targeted support to main market players, including small and medium-sized enterprises, to help them get through this difficult time. We will support them in terms of taxation, fees, costs and financial support. Employment and the economy can only be secured if enterprises are stable. This is one aspect.

Second, from a global point of view, countries around the world should enhance cooperation during this difficult time, especially in the field of epidemic prevention and control, so as to make the epidemic prevention and control more effective and reduce the impact of the outbreak. Work resumption and the order of life will then get back on the right track, and the world economy will be more likely to return to normal, only if the epidemic is under control. Thanks.

Yicai TV:

Although consumption has declined markedly in the first quarter of this year, online retail has remained resilient throughout the process. Will online retail and the related economy contain further and greater growth potential in the future? Thank you.

Mao Shengyong:

Regarding consumption, we can look at this from two aspects.

First, consumption did experience some restraint in the first quarter, especially in terms of outdoor activities and service consumption. Next, as the order of production and life returns to normal gradually, consumption previously depressed will receive some compensation, and the consumption will gradually return to normal. In addition, although consumption has been affected by the epidemic, we must firmly recognize that consumption in our country still possesses huge potential. The steady and sound development of the Chinese economy in the future depends largely on the expansion of consumption. So how can we expand consumption? The core answer consists of two parts: consumption ability and consumption intention. Some people may wonder if consumption still contains such potential given that the national average income was not very good in the first quarter. But consumption is not determined solely by current income, it also involves expected income and the status of property, including savings. Thus, household income is only one of the factors affecting short-term consumption. In the next stage, with the gradual recovery of the economy, the residents' income will gradually increase. Regarding consumption intention, the desire for a better life among our people is quite strong, and the overall trend of upgrading the consumption structure is irreversible. In particular, at present, the degree of social security is constantly improving, its coverage is expanding, and its level is increasing year by year. Under such circumstances, the consumption in our country still possesses huge potential. Next, we will strengthen the intensity of policy implementation and unleash the potential of consumption. Recently, we have introduced a number of policies to expand consumption, including a policy jointly released by 23 ministries and commissions.

Second, new forms of consumption related to the internet have shown strong performance. As the use of the internet becomes increasingly widespread, it has deeply influenced people's production and life. The growth of online consumption is relatively faster, and its proportion of the total consumption will gradually increase. This is a basic development trend. Thank you.

Xi Yanchun:

I just returned to Beijing from Wuhan. During the prevention and control of the epidemic, the Chinese people were presented with a very tough situation. However, after the fight against the outbreak, China has gained the confidence, courage and strength to overcome any difficulty and any challenge. Just as Mr. Mao said, the Chinese economy is presently facing a number of challenges. However, we should view China's economic development from a comprehensive, dialectical and long-term perspective, because the Chinese economy has the condition, the ability and the confidence to turn crisis into opportunity and gain initiative in development. If you have any questions about China's economic development, please feel free to let us know. We are more than willing to provide you with better information services. Thanks again to Mr. Mao, and thank you all. Today's press conference is hereby concluded.

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Read in Chinese

Speakers:

Xu Hongcai, vice minister of finance

Liu Guoqiang, vice governor of the People's Bank of China 

Zhou Liang, vice chairman of the China Banking and Insurance Regulatory Commission 

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office of China

Date:

April 3, 2020

Hu Kaihong:

Good morning, ladies and gentlemen. Welcome to the Joint Prevention and Control Mechanism of the State Council press conference. Today we have invited Xu Hongcai, vice minister of finance, Liu Guoqiang, vice governor of the People's Bank of China (PBC), China's central bank, and Zhou Liang, vice chairman of the China Banking and Insurance Regulatory Commission (CBIRC). They will introduce the measures taken by the Chinese Government to increase the scale of special local government bonds and provide inclusive financial support to micro, small and medium-sized enterprises and will also answer your questions.

Let's first give the floor to Mr. Xu. 

Xu Hongcai:

Good morning, ladies and gentlemen and media friends. 

Increasing the special local government bond quota allocated in advance can help accelerate bond issuance and use, which is of great importance in stepping up macroeconomic control and striking a balance between epidemic prevention and social and economic development. The Central Committee of the Communist Party of China (CPC) and the State Council have attached great importance to this. Xi Jinping, general secretary of the CPC Central Committee, stressed that proactive fiscal policy should be strengthened, the fiscal deficit ratio be raised as appropriate, special treasury bonds be issued and special local government bonds be increased at a meeting of the Political Bureau of the CPC Central Committee, a meeting of the Standing Committee of the Political Bureau of the CPC Central Committee, and a meeting for coordinating COVID-19 prevention and control and social and economic development. 

Premier Li Keqiang has presided over meetings of the Central Leading Group for Epidemic Control and State Council executive meetings where he has called for accelerating the issuance and proper use of special local government bonds, and paving the way for projects to start or resume construction as soon as possible to bolster and expand effective investment. Vice Premier Han Zheng and other State Council leaders have also made clear their requirements. The State Council executive meeting held on March 31 decided to release some special local government bond quota in advance to promote and expand effective investment. The Ministry of Finance (MOF) has implemented the decisions and plans of the CPC Central Committee and the State Council.

This year, in line with the decisions of the CPC Central Committee and the State Council and the authorization of the Standing Committee of the National People's Congress, China's top legislature, the MOF released 1.29 trillion yuan of newly added special local government bond quota. As of March 31, various areas across China issued 1.08 trillion yuan of newly added special bonds, accounting for 84 percent of the quota and increasing 63 percent year on year. It is estimated that China will accomplish the bond issuance task two and a half months in advance. The amount of newly added special bonds spent on projects was 825.5 billion yuan, accounting for 77 percent of the total. According to the requirements of the State Council executive meetings, the newly added special bonds issued by local governments should all be used for building transportation infrastructure such as railways and major infrastructure projects in environmental protection, agriculture, forestry, water resources, municipal utility projects and industrial parks. 

The amount of special bonds used as capital fund for major projects was about 130 billion yuan, which will help promote private capital and expand effective investment. The duration of the newly added special bonds is 14.5 years on average. Of these, 933.1 billion yuan will have a duration of over 10 years, accounting for 86 percent of the total, up 52 percentage points from 2019. The duration is more reasonable compared to previous years and better suits the duration of relevant projects. On the whole, the issuance and use of newly added special local government bonds are going smoothly.

The State Council executive meeting held on March 31 decided to allocate another batch of special local government bond quota in advance in accordance with procedures while ensuring the issuance and use of the quota that had already been released. This arrangement has been made based on factors such as the 2020 fiscal budget, local project construction requirements and the progress of the issuance and use of special local government bonds. The MOF will move to implement the recent decision. The bonds will continue to be used for major infrastructure projects decided upon at State Council executive meetings, including transportation, energy, agriculture, forestry, water resources, environmental protection, people's livelihood, cold-chain logistics, urban utility projects and industrial parks. 

In the meantime, we have optimized the use of bonds based on epidemic control and changes in funding needs. Major national strategic projects have been prioritized and will get key support. Old compound renovation has been added to the list of areas where special bonds can be used. The special bonds can also be used for emergency medical care, public health, vocational education and urban utility facilities such as heating and gas supply. Construction of new infrastructure such as 5G networks, data centers, artificial intelligence, logistics and the Internet of Things will be accelerated. Quota allocation will be tilted in favor of places with a large number of major projects and low epidemic risks. Meanwhile, a larger proportion of this year's newly added special bonds will be used as capital fund for major projects to mobilize more private investment.

In line with the decisions of the CPC Central Committee and the State Council, the MOF and other departments have guided and urged local governments to make preparations and carry out review, approval and selection of projects in advance. The newly added special bonds will be used to finance projects on the ground and will effectively drive the economy.

In addition, the MOF has also placed great importance in supporting the financing and development of micro and small enterprises. Since the start of the epidemic, the MOF has worked with the PBC and the CBIRC to implement a series of measures to encourage the state financing guarantee fund and local government financing guarantee and re-guarantee institutions to reduce fees, exempt counter guarantee requirements, improve service efficiency and provide credit enhancement services for micro and small enterprises. Repayment of guaranteed loans for startups that meet certain requirements can be postponed and micro and small enterprises will have priority in getting loans and interest discounts. The MOF will continue to work with the PBC and the CBIRC to guide financial institutions to increase support for micro and small enterprises to tide them over through the difficulties. Thank you.

Hu Kaihong: 

Thank you, Mr. Xu. Next, let's give the floor to Mr. Liu. 

Liu Guoqiang:

Good morning, media friends. In the face of the impact of the novel coronavirus outbreak on micro, small and medium-sized enterprises, the PBC has taken swift action to confront the new challenges to expand domestic demand, help the resumption of production and stabilize employment under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and the decisions and plans of the CPC Central Committee and the State Council.

We have launched a series of measures to provide targeted financial services for epidemic prevention and control, resumption of production, and the development of the real economy. 

First, we have maintained reasonable and ample liquidity. The central bank injected 1.7 trillion yuan into the market to provide short-term liquidity after financial markets reopened. After reducing the reserve requirement ratio by 0.5 percentage point at the beginning of the year in order to release 800 billion yuan, we cut the banks' reserve requirement ratio in a targeted approach to release 550 billion yuan in long-term funding for issuing inclusive loans. 

Second, we have provided targeted relending and rediscount support by establishing a 300-billion-yuan relending program for epidemic control, with over half diverted to micro, small and medium-sized enterprises. The discounted interest has helped reduce micro and small enterprises' interest cost to less than 1.3 percent. In addition, we have granted another relending and rediscount quota of 500 billion yuan and reduced the interest rate of relending for agriculture and small enterprises by 0.25 percentage point to 2.5 percent. We have also used low-cost inclusive funding to support micro, small and medium-sized enterprises in critical sectors to resume production. 

Third, we have guided the interest rate lower. After the central bank cut the reverse repo rate by 20 basis points on March 30, cumulatively the rate had been cut by 30 basis points so far this year. 

Fourth, we have mobilized the whole financial system to work together. We have urged large state-owned banks to step up inclusive support for micro and small enterprise, offered special-purpose credit support through policy banks, guided local banks to provide better services and strengthened counter-cyclical adjustment. 

All these measures are now showing remarkable results. M2 and non-governmental financing growth rates are largely consistent with and a little higher than that of nominal GDP. Against the backdrop that the real economy is not yet fully resumed, the growth of newly increased loans has hit a record high. Micro, small and medium-sized enterprises are getting more credit at lower financing costs. The money market interest rate level is falling. Meanwhile, the renminbi exchange rate remains stable, while external financial risks are being effectively controlled.

The 88th State Council executive meeting decided to further strengthen inclusive financial support to micro, small and medium-sized enterprises. First, 1 trillion yuan of relending and rediscount quota will be provided to small and medium-sized banks, in addition to the 300 billion yuan and 500 billion yuan previously mentioned. This will be a continuing process that will help a large number of micro, small and medium-sized enterprises suffering high financing costs to obtain relending and rediscount. 

Second, further targeted cuts to the reserve requirement ratio will be carried out for small and medium-sized banks. With a large number of widespread outlets that mainly serve grassroots clients, these banks are inclusive by nature. In other words, unable to meet the needs of large clients, they have to serve small businesses. Implementing a lower reserve requirement ratio at these banks will be an important measure to continue financial supply-side reform. Through reform, the financial supply structure and credit fund allocation will be optimized, so that small and medium-sized banks can better focus on micro, small and medium-sized enterprises, increase credit supply, lower financing costs and contribute more to the real economy. 

Third, bond financing will be further enhanced. The authorities will support financial institutions to issue 300 billion yuan in financial bonds to specifically support micro and small businesses, and guide net financing in corporate credit bonds to increase by 1 trillion yuan over last year. These will be conducive to increasing financial institutions' funding sources, expanding the channels of diversified low-cost financing for businesses and improving financial services.

In the future the prudent monetary policy will be more flexible and moderate. Sticking to the worst-case-scenario thinking and considering changes in epidemic control and economic conditions, we will control the focus and pace of our policies, and give greater prominence to supporting the recovery of the real economy. We will strengthen the aggregate adjustment of monetary policy and counter-cyclical adjustment, balance the relationship among stabilizing growth, preventing risks and controlling inflation, and ensure that M2 and non-governmental financing growth rates are largely consistent with and a little higher than that of nominal GDP. Taking into consideration the characteristics of micro, small and medium-sized enterprises and current constraints, we will work to implement the existing measures to help enterprises out of difficulties. In addition, we will enhance international cooperation and guide market expectations through multiple channels. Thank you.

Hu Kaihong:

Thank you, Mr. Liu. Next, the floor goes to Mr. Zhou.

Zhou Liang:

Good morning. Under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at the core, the whole nation is united. Epidemic control in China is continuing to improve and consolidate, production is resuming in an orderly manner and the recovery of economic and social order is accelerating. But the global spread of the virus is now growing, increasing the risk of a global economic recession. China's economic and social development is facing external risks.

General Secretary Xi Jinping urged the intensification of macro control and the implementation of macro policies to provide more targeted financial services for epidemic control, the resumption of production and the development of the real economy. Under the decisions and plans of the CPC Central Committee and the State Council, and the leadership of the Financial Stability and Development Committee of the State Council, the CBIRC has implemented a series of measures to guide banking and insurance institutions to support enterprises in resuming production and maintaining financial security and stability, which have borne abundant fruit. Figures showed that in the first quarter of 2020, the banking sector granted nearly 7 trillion yuan in new loans, up by 1.18 trillion yuan year on year, giving powerful support to the development of the real economy. Insurance institutions have also played their safeguarding and stabilizing role in society. Meanwhile, banking and insurance institutions have fulfilled their social responsibilities, donating about 2.7 billion yuan to the fight against the virus. In cooperation with Chinese embassies in foreign countries, they have provided facemasks, disinfectants and other anti-epidemic materials free of charge to overseas Chinese students and staff members of Chinese-funded enterprises and institutions overseas. In addition, they have made donations within available resources to 59 countries and regions seriously hit by the epidemic. 

By carrying out the decisions and plans of the CPC Central Committee and the State Council, the CBIRC will implement various policies, comprehensively improve the quality and results of serving the real economy, control financial risks and deepen financial reform in the future, with the aim of contributing to winning the battle against the epidemic and ensuring steady and sound economic and social development. Thank you.

Hu Kaihong:

Thank you, Mr. Zhou. Now we will take questions.

CCTV:

Compared to previous years, what are the new characteristics of and changes in this year's special bonds? Thank you.

Xu Hongcai:

Thank you for your question. In accordance with the decisions and plans of the CPC Central Committee and the State Council, this year's special bonds will focus more on supporting economic and social development as well as epidemic control. Compared to previous years, the highlights and changes will be in the following aspects:

First, the scale will be expanded prudently. In the past two years, with the authorization of the National People's Congress and the approval of the State Council, some quotas for newly increased special bonds have been allocated in advance. In 2019, the quota was 810 billion yuan, while this year, the work has been done even earlier. The MOF has already allocated a quota of 1.29 trillion yuan in new special bonds. In addition, a decision has been made to grant another quota. This year's total volume has surpassed that of last year.

Second, issuance and utilization are being expedited. As was just explained, by March 31, local governments had issued 1.08 trillion yuan in special bonds, surging by 63 percent year on year. Moreover, an additional quota will be granted. The expedited issuance of bonds and fund utilization will help intensify macroeconomic policy regulation to offset the impact of the epidemic as soon as possible.

Third, the funds raised will be earmarked for designated projects. The additional quota for local government special bonds will be skewed in favor of regions with a large number of major projects and low epidemic risks where investment can effectively stimulate economic growth. Increased funds will help accelerate construction of key projects, including those that will improve people's wellbeing.

Fourth, utilization of funds will be optimized to meet the demand of epidemic control and demand changes in the investment sector. Today, the funds raised by special bonds are mainly used in seven sectors--transport infrastructure; energy; agriculture, forestry and water resources; environmental protection; services essential to people's livelihood; cold-chain logistics; as well as urban utility projects and infrastructure in industry parks. In the future, utilization of such funds will be properly expanded, with national key strategic projects prioritized for major support. Meanwhile, funds will go toward the renovation of old urban communities, while local governments will be allowed to invest these funds in emergency medical care, public health, vocational education and urban facilities such as heating and gas supply, especially in accelerating the construction of new infrastructure, including 5G networks, data centers, artificial intelligence and the Internet of Things.

Fifth, the proportion of funds raised by special bonds in the capital fund of key projects will be raised in order to mobilize more private investment. As for the newly issued special bonds this year, local governments are allowed to appropriately raise this proportion, while keeping in line with policies and risk control requirements, so as to better use the special bonds to attract more private investment. Thank you.

Nihon Keizai Shimbun:

Since last August, China's loan prime rate (LPR) has dropped by 26 basis points, which has led to a decreased bank spread. Some banks are calling for a lower benchmark deposit interest rate. What is your opinion?

Liu Guoqiang:

It's true that the decline in LPR results in a decreasing bank spread. But we will take measures, such as providing low-cost funds from the central bank and maintaining reasonably sufficient liquidity in the financial market, to greatly reduce banks' financing costs in the market. At the same time, we are also considering increasing support for banks, especially small and medium-sized banks. The deposit interest rate is a tool that can be used, but many things have to be taken into account before we use it, since it plays a special role as an anchor in the interest rate system. For example, we need to consider price. The Consumer Price Index (CPI) is now 5.3 percent, significantly higher than the one-year deposit interest rate, which is 1.5 percent. Other considerations include economic growth, as well as the exchange rate. With a lower interest rate, we may face greater pressure from currency devaluation. In particular, the deposit interest rate has a more direct impact on ordinary people. To apply a negative deposit interest rate, sufficient evaluation, including ordinary people's opinions, is required. To sum up, it is a tool that can be used, given that its use is fully evaluated.

China Financial and Economic News:

I have two questions. First, what is the current level of government debt in China? Second, what measures is the CBIRC considering to deepen reform and prevent risks for small and medium-sized banks, which are vulnerable in the face of a volatile international market and increasing downward pressure from the domestic economy? Thank you.

Xu Hongcai:

Thank you for your questions. In general, the size of China's government debt has increased over the years, but at a manageable rate. As of the end of 2019, China's local government debt was 21.31 trillion yuan. If measured by the debt ratio (debt balance/comprehensive financial strength), the local government debt in 2019 was lower than the internationally accepted alert standard, at a rate of 82.9 percent. Along with the 16.8 trillion yuan of Central Government debt at the end of 2019, the total national government debt rate (debt balance/GDP) was 38.5 percent, based on the GDP data released by the National Bureau of Statistics, which is lower than the EU's 60 percent warning line and of major market economies and emerging economies. At present, the risk of China's government debt is generally at a controllable level. Thank you.

Zhou Liang:

You also asked the question about deepening reform and preventing risks for small and medium-sized banks. At present, there are more than 4,000 small and medium-sized banks in China, and their total assets account for about a quarter of our entire banking system. They are an important part of our banking system. For a long time, small and medium-sized banks have played an irreplaceable role in supporting local economic development, serving the private sector and small businesses, and facilitating issues related to agriculture, rural areas and rural residents. On the whole, small and medium-sized banks are operating steadily. Although the amount of non-performing assets has risen slightly, the risks are manageable, and the main operating indicators and regulatory indicators are at a reasonable range.

Let me review the measures introduced by the CBIRC in the past three years, especially after the CPC Committee introduced the prevention and mitigation of financial risks as a key mission. The CBIRC has adopted a series of measures to promote the reform of small and medium-sized banks and prevent and mitigate risks.

The first measure focused on the banks' main obligations and operations. We resolved to reverse any deviation from their main businesses and a blind pursuit of speed and scale, so that these banks can return to the businesses they were intended to do and focus on providing local services. In particular, they are expected to strengthen financial services within the community and county where they are located, with strict regulations on operation in other places.

The second measure improved corporate governance. We have sought an approach to integrating CPC leadership into the entire process of corporate governance and strengthening performance evaluation and accountability of the general meeting of shareholders, board of directors, board of supervisors and senior management, as well as directors, supervisors and senior executives. Those who fail to perform their duties will be held accountable and improper performances must be corrected. Deferred payment of remuneration and recourse were implemented as part of an effort to strengthen the incentive and restraint mechanisms.

The third measure optimized the shareholding structure. This included strictly reviewing shareholder qualifications, strengthening the "penetrating" management of shareholders, especially actual controllers, and regulating shareholder behavior, as well as rectifying illegal use of bank funds, illegal acquisition of bank equity, nominal holding of shares and manipulation of bank management via improper means. Recently, we investigated and dealt with the problem of inadequate equity management of some small and medium-sized institutions, removed ill-performing shareholders and adopted regulatory measures in strict accordance with the law. In addition, we carried out centralized custody of equity and applied strict regulations on equity pledge and change, as well as capital increase, in an effort to prevent insiders or major shareholders from illegally using banks and financial institutions as cash dispensers.

The fourth measure clarified the responsibilities of all parties. First of all, we clarified the primary responsibilities of small and medium-sized banks in deepening reform and risk control, because whether a bank operates well mostly depends on its efforts. It is necessary to use strict supervision to force banks to meet their responsibilities, improve their management system and risk control system, and operate in accordance with the law. Secondly, we promoted the fulfillment of responsibilities by local Party committees and governments. Small and medium-sized banks are basically operated locally, and therefore shareholders funded by local state-owned capital must fulfill their responsibilities. Once a risk occurs, the local government must fulfill their responsibility to handle it locally. As a financial administration, the CBIRC must fulfill its supervising responsibilities. As a supervisor, it must not be afraid to offend people and cannot be a "scarecrow." Instead, they must dare to supervise and be good at supervision, and rectify illegal acts.

The fifth measure enhanced capital strength. By accelerating the disposal of non-performing assets, classifying assets, increasing provisioning and profit retention, banks can have better endogenous capacity for replenishing capital. By issuing common shares, preferred shares, non-fixed-term capital bonds and second-tier capital bonds, banks can have more channels and methods for supplementing capital. Local governments are encouraged to inject funds or realizable assets to some small and medium-sized banks under high risks, or replenish capital for small and medium-sized banks through capital injection by state-owned enterprises. At the same time, we welcome qualified and competitive private enterprises and foreign-funded institutions to participate in the reform and reorganization of small and medium-sized banks.

The sixth measure applied policies based on specific situations. Instead of developing any universally applicable policy, we applied policies specific to an area or industry, taking into account of its priorities. For a few institutions under high risks, we used precise measures to remove the danger.

The seventh measure increased anti-corruption efforts in the financial sector. Those who engage in illegal and criminal activities, such as abusing power for money and tunneling, will be severely punished.

To sum up, as a result of regulation and governance in recent years, great improvements have been made in small and medium-sized banks regarding a development model, corporate governance, operation and management, and resistance to risks. We are very confident in their ability to deal with risks.

I will give you a successful example. Hengfeng Bank is a bank with assets close to 1 trillion yuan. Due to the suspected crimes committed by the bank's previous two chairpersons, it had a large number of bad assets. The regulatory authorities took decisive measures to deal with the issue. First of all, along with relevant parties, they replaced the chairperson, president and other senior executives, and reshuffled its leadership. Those that illegally possessed the bank's shared were expelled according to law, and all violators were investigated and held accountable. At the same time, the CBIRC, in close cooperation with the PBC, the MOF and local governments, introduced new strategic investors after the bank was stripped of non-performing assets and injected with capital by local governments. Under the premise of marketization and the rule of law, they successfully mitigated risks and completed the reform and reorganization of the bank. The market remained stable and there were no big fluctuations. Thus, we can say that we achieved the Central Government's goal of defusing risks precisely and maintaining overall stability.

Next, the CBIRC will continue and deepen the reform of small and medium-sized banks by mitigating risks and helping them to embark on the road of high-quality development. Affected by the epidemic and the economic downturn, a small number of these banks have accumulated problems, such as inadequate internal control and corporate governance, and are threatened by some risks and challenges. We will take bank-specific measures based on their actual situation, in line with the principles of marketization and rule of law. These will include reorganization with direct capital injection, horizontal mergers, the establishment of disposal funds and bridge banks, and the introduction of new strategic investment to accelerate reform and reorganization. We will also fully assess the risks that may arise in the process, make various plans and firmly adhere to the bottom line that no systemic financial risks can occur. Problems may pop up in certain banks, but we are confident that things are largely under control, and there will be no regional and systemic risks. Thank you.

Economic Daily:

At present, the epidemic is spreading all over the world. Will its impact exceed that of the financial crisis of 2008? In addition, if the Q1 economic data is not what is expected, does the central bank have a new way to deal with it?

Liu Guoqiang:

This is a very important issue. Many people are now probably concerned about the current state of the economy and how to handle it. They each have their own opinion, some of which may be quite different. As for the world economy, the impact will be great. But how serious will it be and when will it get better? This is still full of uncertainties. My answer may not be enough, but I can only speak to this extent. I cannot provide anymore certainty.

The impact is currently obvious in three aspects. The first is in the industrial chain. Some enterprises, and even industries, can't produce without raw materials. The second is in trade channels. There are no orders even if enterprises do produce items. These two impacts are very significant. The third one is in the fluctuations of market expectations as everyone tries to lower risks. 

What will happen next? And will the impact exceed that of the 2008 financial crisis? The answer is no for now. Let's look at the stock market for example. Since February 24, the stock markets around the world have fallen about 25 percent. During the 2008 financial crisis, they dropped by about 50 percent, which is seen as a sign of a crisis. So far, they have plummeted by 25 percent. Will they drop another 25 percent? No one knows. The International Monetary Fund recently said that the global economy may have negative growth in 2020, and the recession may exceed the financial crisis of 2008. This statement is relatively clear, but it's only a possible scenario. So it is very uncertain. However, at the same time, we should not ignore that at present, each country has introduced a great deal of hedging policies, while also putting more efforts into epidemic prevention and control. International cooperation is also being enhanced, so we need to follow up and pay close attention to developments.

What will the impact on China be? The Q1 data hasn't come out yet. Taking the epidemic situation into account, I think the data will certainly not look good, but we should also see marginal changes. A comparison between February and March will show a significant improvement in March. Therefore, I think the impact of the epidemic on China's economy will be temporary. China's economy will continue to show strong resilience. In addition, we have a variety of tools and sufficient policies to stabilize economic growth.

What to do next? The central bank has issued a prudent monetary policy which pays more attention to flexibility and moderation, and puts support for the recovery and development of the real economy in a more prominent position. This is also required by the CPC Central Committee. Specifically, there are several aspects. 

First, we should implement policies in stages with due consideration for their extent, key points and timing. In the early stage, epidemic prevention and control was the core, which gradually turned into resuming production. Now, we need to recover whole industrial chains to make the whole economy move. Therefore, it is necessary to keep liquidity reasonably adequate to fully meet market demand. That is to say, we should not let the market run short of money or cause inflation. We should make sure M2 and non-governmental financing growth rates are largely consistent with and a little higher than that of nominal GDP. 

Second, we will continue to make good use of the 300 billion yuan in special relending fund and the 500-billion-yuan relending and rediscount program, both of which have been issued. Presently, the two quotas have not been used up and they of course should be utilized in a more targeted way.

Third, the new 1 trillion yuan in inclusive refinancing, which is also a relending and rediscount fund, should be implemented. This covers a wider scope than the previous 500 billion yuan, and should be implemented as soon as possible to achieve a seamless connection with the previous policy without interruption. 

Fourth, we should implement targeted cuts to the reserve requirement ratio and give full play to the positive incentive and guiding role of reserve tools. 

Fifth, we should promote LPR reform, strengthen pricing self-regulatory mechanisms, guide banks to cut their profits to a certain extent in favor of the real economy, and facilitate a significant drop in enterprises' comprehensive financing costs. 

Sixth, we need to strengthen global cooperation, create a good international environment and work with the international community to fight the epidemic and stabilize the global economy. At the same time, we should further our active communication with the market and the media, and make our policy intentions clear in a timely manner. Thank you. 

CNBC:

First question is about the afore-mentioned 300 billion yuan and 500 billion yuan loans. Are there any figures for the current situation of its implementation? The second question is: What are the specific MOF measures or policies being taken to support micro, small, medium-sized enterprises and are there any new measures to effectively stimulate consumption? Thank you.

Liu Guoqiang:

Yes, there are a few figures. The first is about the 300-billion-yuan specific relending fund, which is mainly used for major companies to fight against the epidemic and ensure supplies such as medical materials. As of March 30, the 300 billion yuan had been disbursed to nine national banks and some corporate banks in 10 key provinces and municipalities. A total of 228.9 billion yuan preferential loans had been given to 5,881 major companies, each getting no more than 40-million-yuan loans. The weighted average interest rate was 2.51 percent and after an MOF 50-percent interest subsidy, the companies' actual financing interest rate was about 1.26 percent. That's it for the 300 billion yuan. There is another 500 billion yuan relending and rediscount quota for banks focusing on supporting the orderly resumption of work and production. By March 30, local corporate banks had accumulatively issued 276.8 billion yuan in preferential interest rate loans, including subsidies, which have supported 351,400 enterprises (including rural households). Specifically, the agriculture-related loans were 55.2 billion yuan, with a 4.38-percent weighted average interest rate; inclusive financing for micro and small enterprises stood at 155.6 billion yuan, with a weighted average interest rate of 4.41 percent; and subsidies reached 66.1 billion yuan, with an interest rate of 3.08 percent. These interest rates are in line with the State Council's requirement of no higher than 4.55 percent.

There was an additional 1 trillion yuan of relending and rediscount proposed a few days ago at the 88th meeting of the State Council. It's supposed to go along with the recovery of the real economy and the previous 300 billion yuan and 500 billion yuan policies in case there is a gap between policies. It aims to provide low-cost financing support for small and medium-sized banks through the PBC's relending and rediscount tool. The cost is the same as the previous 500 billion yuan at 2.5 percent. The move can lower the cost of debt for small and medium-sized banks, which accordingly will improve their capacity to deliver profits to micro, small and medium-sized enterprises. For the 1 trillion yuan of relending and rediscount, we will require small and medium-sized banks to issue loans to micro, small and medium-sized enterprises at preferential interest rates, but have not stipulated the interest rate. The maximum rate for the relending of the 500 billion yuan is 4.55 percent. We have other methods such as setting reward assessments to guide the banks to lower their lending rates to these enterprises. There will be no financial subsidies from the Central Government, but according to the utilization of the 500 billion yuan , although the Central Government did not offer subsidies, many local governments did. Thus, we hope local governments can provide interest rate subsidies for the 1 trillion yuan, so that enterprises can enjoy a practical preferential rate. In terms of the timing, we are making plans right now, and we will be able to implement it after the 500 billion yuan runs out. Specific measures will soon be introduced. Thank you.

Xu Hongcai:

Since the outbreak of the epidemic, the MOF has attached great importance to the financing of micro and small enterprises, fully supporting them to keep their cash flow intact, and assisting them in overcoming difficulties. From the perspective of fiscal policy, a series of policies have been introduced, including tax cuts and subsidies. According to the plans from the State Council executive meeting on March 31, concentrating on issues such as improving the risk sharing mechanism for loans, encouraging micro,small and medium-sized enterprises to gain trust in commercial insurance products, reducing guarantee rates for government financing and reducing comprehensive financing costs for micro, small and medium-sized enterprises, the MOF will do the job from the three following aspects:

First, the scale of newly added reguarantee business by the national financing guarantee fund should be no less than 400 billion yuan in 2020 and will be required to be invested in 10 prefecture-level financial guarantee institutions that have made notable achievements in supporting agriculture-related and small companies. For loans under one million yuan, the reguarantee fee should be exempted, while for those over 1 million yuan, the fee should be halved.

Second, the government financing guarantee industry is required to halve the fees and reduce the comprehensive financing guarantee rate to less than 1 percent. Meanwhile, newly added business to support agricultural and small companies in 2020 should account for no less than 80 percent of the total.

Third, qualified entrepreneur guaranteed loans will be extended. We will further increase support for more startups and micro and small enterprises, lower the entry threshold and include key sufferers of the epidemic into the scope of support. It is estimated that in 2020, we will increase the list by 1 million individual entrepreneurs and 10,000 micro and small enterprises, with the growth rate increasing by 50 percent over 2019.

Next, the MOF will accelerate the optimization of the discounting policy for entrepreneur guaranteed loans through which more micro and small enterprises will have money to start businesses and easily run their businesses. We will improve guarantee policies and motivate institutions to support small businesses, pool financial resources to support micro and small enterprises, and achieve targeted assistant so that we can work together to help them tide over current difficulties. Thank you.

Bloomberg:

Hello, I'm a reporter with Bloomberg and my question is for Mr. Liu. You just mentioned the stability of the banking system. According to the Financial Stability Report released by the PBC in 2019, a stress test was conducted where 17 major banks failed and more than 180 large banks failed the liquidity test under the condition that the growth rate of the GDP was less than 4.1 percent. This year, the rate is estimated to be 3.1 percent, far less than the worst case scenario of 4.1 percent last year, how do you evaluate the banks' performance and will there be a new stress test? Thank you.

Liu Guoqiang:

The banking industry stress test in 2019 was based on macroeconomic econometric models, historical scenarios and expert judgment, and was mostly based on assumptions. This situation is "extreme but possible," with the possibility relatively small and is a hypothetical requirement. Since the outbreak, we have closely monitored the risk to the banking system, systematically assessed the impact of the outbreak on the banking industry and conducted stress tests. Some new test results will be disclosed in a timely manner through the Financial Stability Report and the report will be updated.

The epidemic has caused a large short-term impact on the economy. Some industries have suffered greatly and the risk will inevitably increase. There is also a downward pressure on banks' credit assets. But overall, China's banking industry has shown a strong loss-absorbing and anti-risk capacity. By the end of 2019, the non-performing loan ratio of China's commercial banks was 1.86 percent, far below the 5-percent regulatory standard. The provision coverage ratio was 186.08 percent and the reserve for loan loss was 4.5 trillion yuan. This is sufficient to cushion rising non-performing loans. In 2019, the banking industry disposed of 2.3 trillion yuan of non-performing assets, and there are diverse measures to monitor banks' asset quality. Although it is difficult for some banks, they have the ability to ease the pressure.

Zhou Liang:

Mr. Liu has given us a comprehensive introduction. The stress tests conducted by the PBC under the macro-prudential policy framework took into consideration extreme difficulties, which may not actually happen. Meanwhile, the CBIRC's supervision has shown a capital adequacy ratio of 14.6 percent. We will step up efforts to handle non-performing assets. Since the beginning of the year, a plan has already been put on the agenda. In terms of capital replenishment, we will continue to broaden the channels, such as issuing capital supplementation bonds, preference shares and common shares, so as to increase banks' endogenous capital supplement. If these plans are carried out step by step, there won't be major problems. Market performance will prove this. Recently, the “northbound” investment begins to flow into the Chinese stock market, as both the country's capital market and stock price of banks have remained relatively stable. In other words, our banking sector is sound in terms of policy, market and institutional performance. Thank you.

China News Service:

Affected by the pandemic, many micro, small and medium-sized enterprises are facing difficulties in operation and limited sources of capital chain. What measures will the CBIRC take to support them? Thank you.

Zhou Liang:

Since the outbreak, many micro, small and medium-sized enterprises have undergone difficult times. One of the prominent problems is the limited sources of capital chain. We have taken a series of timely measures to ease their financial pressure. According to statistics, by the end of February, the balance of inclusive loans to micro and small enterprises was 5.55 trillion yuan, up 31.8 percent year on year, for a considerable growth. The average interest rate on loans was 5.22 percent, down 0.22 percentage point from the previous year. Among them, the average interest rate of five major banks' inclusive loans to micro and small businesses was 4.4 percent, down 0.3 percentage point from the previous year. We have focused mainly on the following areas:

First, we have worked to increase credit to micro and small enterprises, weigh loans toward first-time borrowers, improve the quality of financial services and reduce their borrowing costs. We want to ensure that the growth of loans for micro and small enterprises with a credit quota of under 10 million yuan per company is not lower than the growth rate of any other loans, and that the number of accounts with a loan balance is not lower than the level at the beginning of 2020. Five major banks will strive for a year-on-year increase of 30 percent for inclusive loans to micro and small enterprises in the first half of the year. We will focus on increasing the proportion of first loans made to new clients of these enterprises and we will appropriately increase the proportion of credit loans and loan renewals to further reduce their financing costs.

Second, we have implemented the provisional deferment policy for both principal repayment and interest payment. The introduction of this policy was welcomed by the vast number of micro, small and medium-sized enterprises. The provisional deferred policy for principal repayment and interest payment will exempt default interest without adjusting clients' loan category or credit record. All of this has created conditions for enterprises to tide over difficulties. According to incomplete statistics, the principal and interest of micro, small and medium-sized enterprises' loans that are now subject to deferment policy amount to 700 billion yuan, and the majority of these enterprises and self-employed business owners are enjoying this preferential policy.

Third, we have increased credit support to micro, small and medium-sized enterprises in industries and regions severely hit by the pandemic. For industries such as wholesale and retail, hospitality and catering, logistics and transportation, and cultural tourism, which have been severely hit by the COVID-19 outbreak, we urged banks to not rashly withdraw, cut off or defer lending. Financial institutions were encouraged to reduce the loan interest rates so as to benefit enterprises. At the same time, by providing more credit loans and medium- and long-term loans, we wanted to support enterprises to resume work and production as soon as possible. We have also made targeted arrangements for Hubei Province. We will strive to lower the comprehensive financing cost in 2020 by over 1 percentage point from last year for small and micro enterprises in Hubei.

Fourth, we have given full play to the role of non-commercial banks in counter-cyclical adjustment and support the development of private, micro and small enterprises. Non-commercial banks are encouraged to provide low-cost funds to small and medium-sized banks, allowing them to extend relending funds to private, micro and small enterprises at favorable interest rates no higher than the interest rates of local inclusive loans. At present, the balance of relending funds has reached 180 billion yuan, up 17 percent from the beginning of the year. We will step up our efforts in the future.

Fifth, we have strengthened the utilization of Fintech (financial technology) to provide precise and convenient services for micro, small and medium-sized enterprises. We have encouraged the use of technologies such as big data and cloud computing to provide both online and offline services to enable these enterprises to obtain financial services without leaving their homes through the Internet, mobile phones and telephones.

Sixth, we have effectively reduced the financing costs of enterprises. We will further clear bank fees, crack down on irregularities, such as the practice of taking deposit as the premise condition for the approval and issuing of loans, and encourage insurance institutions to provide financing and credit to micro, small and medium-sized enterprises. In addition, Mr. Xu has just talked about lowering the fees on financial guarantees and intermediary services, while the PBC has put forward requirements to ensure that the dividends of the policies go to small and micro businesses and are not withheld.

In short, sound economic growth will ensure the stability of finance, and good performance by enterprises will boost the financial development of China. Micro, small and medium-sized enterprises are the main force for stabilizing employment. This concerns the vital interests of the people and was greatly affected by the pandemic. All parties should work together to help them tide over the difficulties. We urge banks and insurance institutions to put themselves in these enterprises' shoes and provide timely assistance to them, as well as honestly implement the policies of the CPC Central Committee and the State Council. Thank you.

Economic Herald:

A State Council executive meeting recently decided to increase the issuance of local government special bonds ahead of schedule. Is this a measure adopted to tackle the impact of the COVID-19 outbreak? How will risks be prevented while promoting the issuance of special bonds?

Xu Hongcai:

Assigning some of the local government special bond quota ahead of schedule is a measure to cope with the economic downturn as well as the COVID-19 outbreak. While giving better play to the role of special bonds, we should also prevent risks, which is an important part of our work. To play our role and prevent risks, we mainly take four aspects into consideration:

First, quick results are expected. Local governments are required to issue special bonds according to the quota decided by the Central Government. Local authorities should strive to issue the bonds by the end of the second quarter and allocate them to projects for substantive use with quick results. This is the most urgent work to do in order to deal with the economic impact of the outbreak.

Second, good projects are required. We have made some adjustments and expanded some areas on the basis of the seven fields that I mentioned before. Local governments are required to select projects in accordance with the fields designated by the Central Government. Key projects, must-do projects and projects that can play a major role in stimulating economic growth should be chosen. In particular, local governments and relevant departments are required to work closely, and local authorities must undertake their responsibilities. Financial departments, development and reform departments and others should all play their roles and cooperate with each other. After the local governments select projects, they should report to the National Development and Reform Commission and the MOF for examination and verification.

Third, the projects should be qualified and in compliance with regulations and laws. After local governments choose projects and central authorities check and verify them, all projects are required to be qualified and in compliance with the requirements of special bond management. That is to say, they should be public welfare projects with certain benefits. And the projects should have a scheme for financing and income balance, so as to ensure that they are truly effective while preventing risks.

Fourth, supervision should be conducted throughout the whole process of special bond issuance. In accordance with the requirements of special bond penetration supervision, we will track and manage the whole process of special bond issuance. If there are any problems, we will urge timely rectification and implementation. Thank you.

China Daily:

The COVID-19 epidemic has severely affected industrial chains. What measures has the CBIRC taken to support the coordinated resumption of work and production of industrial chains? Thank you.

Zhou Liang:

Thank you for your question. China is a manufacturing powerhouse occupying an important role in the international industrial chain. Along with the development of the modern economy, the structure and functions of many finished products have become increasingly complicated, making it impossible for one or even several enterprises to complete product design, research and development, production, processing, transportation and sales independently. Products have many parts and their divisions of labor have become more well-defined, which has generated these industrial chains. Analyses show that a leading enterprise in the manufacturing industry is usually supported by 200-300 micro, small and medium-sized enterprises or supporting companies, which have developed into an ecosystem of leading enterprises and other firms on industry chains. The epidemic has dealt a severe blow to China's industrial chains. Since the insufficient supply of certain parts may hold up the production of finished products, China's financial authorities have taken swift moves to improve services related to industrial chains and support enterprises' resumption of production and work.

First, the CBIRC has encouraged banking institutions to provide all-around financial services covering the whole industrial chains of leading enterprises and upstream and downstream small and micro firms based on analyses of information and capital flow as well as logistics.

Second, it has improved support for leading enterprises in industry chains, increased liquidity loans and medium- and long-term loans, encouraged leading enterprises to resort to loans and pay funds in a timely manner to upstream and downstream firms, and allow downstream enterprises to defer loan payments. The CBIRC has asked banks to improve the monitoring of credit funds and enhance the efficiency of payment for upstream enterprises to avoid delayed payment or the default in payment of large enterprises.

Third, it has followed the financing demands of leading enterprises as well as upstream and downstream micro, small and medium-sized enterprises, innovating financial products and services by developing financing through accounts receivable, orders, warehouse receipts and inventory. It is expected to provide 800 billion yuan in accounts receivable financing for micro, small and medium-sized enterprises on industry chains this year. 

Fourth, banks and insurance institutions are encouraged to further stabilize foreign trade through financial services, improve the cross-border financial service chains, cooperate with international financial institutions and provide credit support and financing services to help stabilize the global industrial chain.

Fifth, it has improved the technological level of financial services for industrial chains, mainly by encouraging banks to develop credit software and information systems, and further cooperation with leading enterprises on system matching, information sharing and fund monitoring.

Research findings show that the Industrial and Commercial Bank of China and China Construction Bank have provided all-around financial services for several thousand industrial chains. The CBIRC will continue to provide more targeted and effective financial services for industrial chains, prevent and control risks while ensuring steady growth, and promote a virtuous cycle of financial support and the real economy. Thank you.

Market News International:

Some media reports suggest that no special local government bonds can be directed to the real estate sector or land development. Is that true? If so, how will the shanty town renovation projects get funds this year? Will funds for shantytown renovation projects be significantly cut? Could you also elaborate on the specific use of special treasury bonds?

Xu Hongcai:

Thank you for your questions. The renovation of shantytowns is a major project related to people's livelihood and China's development. In line with the decision of the CPC Central Committee and the State Council, local governments have promoted renovation in recent years with great efforts and have made remarkable progress. Many residents in rundown areas have moved into apartment buildings. Some qualified projects have been completed across the board through years of efforts, while some are still face difficulties.

In 2020, local governments are supposed to follow the central requirements of reigning in the property sector, control the scope and standards of shantytown renovation, strictly evaluate the financial bearing capacity and settle the annual tasks of renovation in a scientific way. Local authorities need to avoid making one-size-fits-all renovations, setting impractical targets and blindly resorting to loans. It is necessary to focus on shantytowns in poor environments in old urban areas, as well as in state-owned industrial, mining, forest and reclamation areas. The Central Government has clarified that special local government bonds should not be used for land acquisition or stock and real estate-related projects in line with the requirements proposed at the 2019 Central Economic Work Conference on renovation of existing residential projects and old urban communities. With coverage adjusted, special local government bonds will support the renovation of old urban communities. Amid the current macroeconomic situation, the government will promote the construction of projects that can be started soon and produce tangible results to ensure the steady completion of work and effective investment. 

You also mentioned the issuance of special treasury bonds. Since the beginning of the year, the COVID-19 epidemic has exerted phased impacts on China's economy and added to downward pressure. As the pandemic spreads across the world, global economic and trade growth has been severely impacted, forcing China's economic development to face new challenges. To effectively cope with the impact of the epidemic and improve the adjustment and implementation of macroeconomic policies, the government has pledged to moderately increase the fiscal deficit rate and issue special treasury bonds this year, along with the CPC decision, to deliver positive and clear signals to society, boost market confidence and ensure the realization of annual economic and social development targets. A deficit rate increase and the issuance of special treasury bonds need to go through legal procedures. The State Council will submit them to the National People's Congress for review and approval. The specific plans will be settled based on the domestic and international economic situation, the demands for national macroeconomic adjustment and control, and fiscal revenue and expenditure. Thank you.

Hu Kaihong:

That is the end of today's press conference. Thank you.

.

Read in Chinese

Speakers:

Ma Zhaoxu, vice minister of foreign affairs;

Tian Xuejun, vice minister of education;

Lyu Erxue, deputy head of the Civil Aviation Administration of China (CAAC);

Zhang Yang, head for the Department of International Cooperation of the National Health Commission.

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office of China

Date:

April 2, 2020

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference held by the State Council Information Office (SCIO). Today, we have invited Ma Zhaoxu, vice minister of foreign affairs; Tian Xuejun, vice minister of education; Lyu Erxue, deputy head of the Civil Aviation Administration of China (CAAC); and Zhang Yang, head for the Department of International Cooperation of the National Health Commission. They will brief you on the health and security of Chinese students living overseas during the COVID-19 outbreak and take questions.

First, I will give the floor to Mr. Ma. 

Ma Zhaoxu:

Ladies and gentlemen, good morning. I'm very glad to attend the press conference held by the State Council Information Office again and communicate with you on the health and security of Chinese students overseas during the COVID-19 outbreak. 

Students studying abroad are children of the motherland and an important force to build China's future. The Party and the country have always attached great importance to Chinese students living abroad. At the early stage of the COVID-19 outbreak in China, concerned about the motherland, the Chinese students overseas donated money and supplies in support of the fight against the epidemic to the homeland, which showed their precious patriotism. Currently, the pandemic is spreading at multiple hotspots around the world. The CPC Central Committee has always cared about the health and safety of Chinese students overseas and has adopted a series of major measures.

General Secretary Xi Jinping has given important instructions and made arrangements regarding this issue on many occasions. He ordered more guidance and support to Chinese nationals overseas and the protection of their lives and health. According to the meeting of the Political Bureau of the CPC Central Committee, it is necessary to strengthen the care for Chinese nationals overseas, and the embassies and consulates abroad must provide consular protection, guidance on protection and secure material supplies to protect their lives and health. General Secretary Xi Jinping personally emphasized during calls with leaders from Britain, the United States, France, Germany and other countries that the Chinese government attaches great importance to the lives and health of Chinese citizens overseas. He also urged the host countries to safeguard the health, safety and legitimate rights of Chinese citizens, especially students. These requests were met with positive responses.

The Ministry of Foreign Affairs, together with the Ministry of Education and other relevant departments, resolutely implemented the important instructions of General Secretary Xi Jinping and the arrangements of the CPC Central Committee. Wang Yi, state councilor and foreign minister, and the Party Committee of the Ministry of Foreign Affairs required more than 280 embassies and consulates abroad to prioritize the relevant work of safeguarding Chinese students' health and lives. Acting on the principles of "putting people first" and "diplomacy for the people," the embassies and consulates are required to take all-out efforts to safeguard the health and safety of Chinese students living overseas as though they were taking care of their own children.

According to the deployments, we have issued multiple measures in this regard within a short period of time. Chinese embassies and consulates overseas have been in close contact with Chinese students in those countries, learned of their appeals and difficulties, and helped them solve all kinds of problems. The consular helpline 12308, operated by the foreign ministry, stands ready to provide consular protection and assistance. The Chinese embassies and consulates abroad have set up 24-hour hotlines to respond to the needs of students overseas. Meanwhile, through various channels that include embassy websites, WeChat and Chinese language media, we have introduced an online medical service platform to overseas Chinese nationals and forwarded a prevention and control guideline on COVID-19, as well as host countries' regulations on the pandemic control. We have strengthened communication with Chinese nationals overseas, especially students, in various ways. Chinese embassies and consulates abroad have mobilized the local Chinese community to establish pairing assistance systems with overseas students and set up platforms for Chinese citizens to help each other, providing services to buy supplies and giving a helping hand to those in quarantine. For example, with the promotion of the embassy in Germany, 85 Chinese student unions in Germany have set up 101 WeChat groups for the prevention and control of the pandemic, keeping contact with 35,000 Chinese students.

The Chinese Embassy in the U.S. invited experts to talk with overseas students and representatives of overseas Chinese via video link. Chinese ambassadors to the U.S., the UK, Germany, Italy, South Korea and other countries communicated with overseas students and overseas Chinese representatives directly via video link in the CCTV news studio. More than 100 million people watched the live broadcast online when Mr. Cui Tiankai, Chinese ambassador to the U.S., appeared on the CCTV news program.

Our embassies and consulates have actively performed their duties, and urged host countries to safeguard the health, safety and legitimate rights and interests of overseas Chinese students. Our ambassadors and consul-generals wrote letters to the presidents of local universities, asking them to take good care of Chinese students and solve their difficulties regarding accommodation and their studies. Recently, nearly 100 Chinese students studying in Russia were unable to obtain visas on arrival due to medical isolation or other reasons. The Chinese Embassy in Russia actively communicated with the Russian government and helped them solve their problems promptly. Some countries asked all students to move out of their dormitories because of the outbreak, so Chinese embassies immediately communicated with relevant departments to grant the students permission to stay and helped them solve this pressing problem. After learning that four Chinese students had been diagnosed with the novel coronavirus in Spain, the Chinese embassy and consulate in Spain urged local departments and hospitals to give them prompt and proper treatment, and invited Chinese doctors to provide them with online professional consultation from China. When words and deeds of discrimination against Chinese citizens appeared in some countries, Chinese embassies and consulates spoke out and took action at the earliest possible time. We expressed our condemnation, lodged solemn representations, and safeguarded the legitimate rights and interests of all Chinese citizens abroad.

Since the outbreak of the epidemic overseas, protective equipment including face masks have been in short supply worldwide. Chinese embassies and consulates have immediately responded to the needs of overseas Chinese students. In accordance with the general deployment of the Chinese government, we have made every effort to collect face masks, disinfectant, sanitizing wipes and other urgently needed materials through various channels, and distributed "health packages" to overseas Chinese students. Many diplomats from Chinese embassies and consulates even donated their own masks and stockpiled materials to our overseas students. The Chinese Embassy in the UK has prepared 200,000 "health packages", trying its best to ensure that every overseas student can get one. At present, Sri Lanka is running extremely short of epidemic prevention equipment and has imposed martial law. Seeing that many Chinese staying outside the capital of Sri Lanka need masks urgently, the Chinese embassy there immediately communicated with local governments and coordinated with local police to deliver masks and other emergency supplies by relay to Chinese compatriots including overseas students.

At present, the Ministry of Foreign Affairs has prioritized work regarding the "health packages," allocating 500,000 to countries with more Chinese students, including more than 11 million masks, 500,000 disinfection materials, and epidemic prevention guidelines. Since many countries have implemented national lockdown or lockdown on cities, the foreign ministry and the Civil Aviation Administration of China (CAAC) have been racing against time to prioritize deliveries of the "health packages" by civil aviation planes, so as to ensure overseas students can receive them in a timely manner. The picture here shows a "health package" prepared by the Chinese Embassy in Iceland, which includes masks, hand sanitizer, and epidemic prevention guidelines. Although the "health package" is small, it conveys the care and love of the motherland, the Party and our people, making overseas students feel a sense of warmth. Many overseas students have stated that the "health packages" let them truly feel the care of the motherland and have strengthened their confidence in fighting the epidemic. They said they would protect themselves well while completing their studies, and serve the motherland as soon as possible. One overseas student said on WeChat Moments, "I will never forget that there are students from all over the world on campus. But so far, I have only seen the Chinese embassy distribute epidemic prevention equipment to each dormitory door. Thank you, my motherland!" Another student wrote, "I will deal with the epidemic in a rational and scientific way, and enhance self-protection without neglecting my studies. This way I will let the people of the motherland and my family at home feel at ease."

We have also dispatched medical experts and working groups to provide scientific and professional guidance on epidemic prevention and control for overseas Chinese, especially overseas students. A total of 10 medical expert teams have been dispatched to eight countries. They are working with local governments to fight COVID-19, and have held face-to-face or online lectures to introduce knowledge on epidemic prevention to overseas Chinese students, companies and citizens. With the support of the Chinese Consulate-General in Milan, overseas Chinese in Italy have worked with the medical experts to establish an "online makeshift hospital." A few days ago, a joint team of medical experts from Shandong province arrived in the UK, including disease control and medical personnel. So far, they have held three online exchange events to provide guidance on epidemic prevention to overseas Chinese and help them lessen stress and anxiety. Overseas Chinese students have expressed their appreciation for the support and kindness from the CPC and the motherland.

When our overseas Chinese students encounter emergencies and are lost in deep trouble, the CPC and Chinese government will always be there to help them. Since the COVID-19 outbreak, China has returned overseas nationals facing difficulties to China by chartered airplanes and temporary flights. Since March, when the epidemic was spreading rapidly across the world, China has sent nine chartered planes to bring back 1,457 Chinese nationals, including overseas students from Iran, Italy and other hard-hit countries. Recently, many countries have made changes to their entry and exit policies for foreigners and adjusted flights, leaving overseas Chinses students stranded at airports in Ethiopia, Cambodia and Bangladesh. I remember that there were around 300 people stranded in Ethiopia, over 100 in Bangladesh and more than 140 in Cambodia. Most of these were overseas Chinese students. After learning about the situation, the Ministry of Foreign Affairs asked local embassies to act immediately and provide consular protection and assistance to the Chinese nationals, including providing necessary hospitality, accommodation, face masks and other health supplies. With the joint efforts at home and overseas, the problems have been properly resolved. All the Chinses nationals stranded overseas have already been brought back home by additional flights.

China now still faces the risk of epidemic rebounding at home. The spread of the epidemic outside of China has also posed new challenges to our domestic epidemic prevention and control work. Chinese embassies and consulates have paid close attention to the overall situation of the epidemic, as well as the demands and plans of overseas Chinse students. As far as I know, most overseas students have chosen to stay in their host countries. Experts have also suggested, based on the WHO's advice, reducing cross-border movement of people under the current situation. China's civil aviation authorities also reduced the volume of international passenger flights due to the pandemic. However, we have noticed that there are still some overseas Chinese students who need to return to China because of practical difficulties that cannot be resolved. The CAAC has stated that the major air transportation guarantee mechanism will be activated to arrange additional flights and charter flights to cities where a large number of people in need are concentrated together, if their destinations have the ability to prevent and control the epidemic. In fact, with our earlier efforts, many overseas Chinese students have already returned home. China is also taking measures to help Chinese students who run into difficulties in hard-hit countries to come back home in an orderly manner. Today, we have already arranged a temporary chartered flight to bring overseas students in London back home. The plane took off at 9:30 a.m. In light of the needs for domestic prevention and control, those returning to China should comply with the relevant regulations, including strict testing, isolation and observation. This is for the sake of their health and public health security.

Also, I would like to say, in face of the pandemic, our personnel working in Chinese embassies and consulates overseas have always kept in mind their aspirations and missions. They have devoted themselves in the fight against COVID-19 and provided services to overseas Chinese nationals, including students. In addition, our students studying abroad have also made their own efforts. Chinese students in Germany, the UK, Japan and other countries have set up online platforms and groups for epidemic prevention and control. They are supporting and caring for one another, as well as volunteering to help distribute health kits, playing an irreplaceable role in the fight against COVID-19. The Chinese embassies and consulates will always stand with our students and together we will secure the final victory.

The prevention and control of the epidemic is a people's war against COVID-19. Every Chinese national, including those studying overseas, are playing their part in combating the epidemic to eventually winning this war. I want to stress, again, that the Party and the government consider the health and well-being of Chinese nationals living overseas a priority. The motherland will always actively back overseas Chinese citizens. Conducting "diplomacy for the people" has always been the aim of our diplomatic work. We will take practical actions to embody the care and love for overseas students of General Secretary Xi Jinping and the Party and state by safeguarding overseas students' lives and physical well-being. We will work with the broad masses of overseas students to win this war. Thank you.

Hu Kaihong:

Thank you, Mr. Ma. Now, I will give the floor to Mr. Tian. 

Tian Xuejun:

Good morning, everyone. People are concerned about the safety of overseas students while the epidemic is still spreading outside the country. Overseas students are treasured assets to the Party and the people. Their health and safety is always a concern of the Party and state. Strengthening the love and care for overseas students is a major part of the epidemic prevention and control work targeting Chinese nationals living overseas. 

The Ministry of Education has been earnestly implementing General Secretary Xi Jinping's important instructions and CPC Central Committee's decisions and arrangements. It has been working with the Ministry of Foreign Affairs and embassies and consulates stationed abroad to push forward with various works. The Ministry of Education has demanded higher education facilities across the country to fulfill their job responsibilities and make efforts domestically and abroad at the same time. We have taken practical actions to demonstrate the Party and state's love and care towards overseas students in all areas, from offering anti-epidemic reminders and consultation, distributing anti-epidemic supplies, and assisting in accessing healthcare services, to helping handle issues regarding academic work and living, encouraging educational circles to help each other, encouraging overseas Chinese circles to make contributions and show kindness, and strengthening consular protection to safeguard the legitimate interests of overseas students. Our only goal is to do our best to safeguard the health and safety of overseas students.

Specifically, the measures taken by the Ministry of Education can be summarized as six "strengthenings": strengthening guidance for anti-epidemic works, strengthening the guarantee of material supplies, strengthening treatment of patients, strengthening psychological support, strengthening help and support for people in need, and strengthening consular protection. 

To strengthen the guidance for anti-epidemic works, the Ministry of Education organized specialists to compile a guide on the prevention of the novel coronavirus for overseas students. Professor Zhang Wenhong and other known experts in China were invited to give lectures to overseas students, and they have proven popular. 

To strengthen the guarantee of material supplies, embassies and consulates stationed overseas have collected anti-epidemic materials, including masks, from multiple resources, rushing to produce health packages and love packages overnight out of these materials and then distributing them to overseas students in no time. This work is still ongoing. 

To strengthen the treatment of patients, the Ministry of Education and embassies and consulates stationed overseas have established a system to carry out COVID-19 tests for overseas students and created daily reports. Once a confirmed case or a suspected case is discovered, the emergency response mechanism will be activated immediately. Judging from the data we have obtained, the number and proportion of confirmed cases are relatively small among overseas students in general. 

To strengthen psychological support, we have consolidated the resources of higher education facilities in the country to offer counseling services for overseas students around the clock. We have also set up consulting hotlines to clear doubts and offer help to overseas students and their parents at home. 

To strengthen help and support for those in need, embassies and consulates stationed overseas and the Ministry of Education have gathered overseas students together via the All-China Students' Federation and WeChat groups. Some embassies and consulates have widely mobilized Chinese-funded organizations and overseas Chinese associations in local areas to offer help to overseas students in need. A small portion of overseas students has encountered practical problems, such as visa expiration and being forced to move out of the dormitory. Our diplomats have resolved these situations in a timely manner. 

To strengthen consular protection, we have demanded embassies and consulates stationed overseas to pay close attention to incidents of overseas students being discriminated against or being assaulted and to make strong representations accordingly in a timely manner. The WeChat account “教育部平安留学” (Ministry of Education, Study Abroad Safely) has been continuously compiling and publishing safety notifications for typical cases of overseas Chinese students being under threat and offering targeted safety advice.

Next, we will enhance analysis and assessment of the epidemic, continue to improve and refine our plans, and go all out to do a better job of conducting epidemic prevention and control work among overseas students by working with the Ministry of Foreign Affairs and embassies and consulates stationed overseas. Thank you.

Hu Kaihong:

Thank you, Mr. Tian. Next, the floor is given to Mr. Lyu Erxue.

Lyu Erxue:

Good morning, everyone. As the situation of the COVID-19 epidemic changes, the focus of China's efforts has shifted from guarding against domestic transmission and spreading outside China , to instead guarding against imported cases and a possible domestic epidemic rebound. Following the work requirements of the State Council's Joint Prevention and Control Mechanism to contain the continuously rising imported cases from overseas, the CAAC has adopted a policy to further cut international passenger flights, stipulating that each airline operate only one flight a week per country. Now, a total of 47 domestic and international airlines maintain regular flights with 61 destinations in 40 foreign countries. The total number of international flights stands at no more than 134 per week. Nevertheless, the weekly flight schedule is subject to adjustment in light of the actual operation of airlines. For instance, there are 108 flights scheduled this week. Such a significant decline in international flights is expected to effectively block the epidemic from being imported into China through air travel. The move to maintain the minimum level of flights is supposed to aid homeward bound Chinese citizens abroad, especially overseas Chinese students. 

Meanwhile, in order to reduce passengers' risk of infection and guarantee the safety of flights, as well as epidemic prevention and control, the CAAC has taken several measures. First, it has released its fourth cumulative update of a guide regarding epidemic prevention and control technology for passenger airlines and airports. With the ongoing development of the COVID-19 outbreak, especially the evolving international epidemic, the CAAC has been continuously improving its epidemic prevention and control measures for passenger airlines and airports, following the requirements of adopting differentiated strategies subject to regions and levels. Second, it requires all airlines to properly control the load factor of international flights and make reasonable adjustments to the cabin layout to disperse seating as far as possible. Third, it requires health checks on all passengers. This includes body temperature scanning before boarding, as well as an extra body temperature inspection of passengers once onboard. Fourth, airlines are instructed to set up a temporary quarantine zones on their planes. Any passengers found with fever, fatigue, dry cough and other symptoms must be isolated in time to avoid cross-infection. Fifth, it requires all airlines to conduct disinfection on their aircraft.

In short, adoption of the above-mentioned measures can effectively prevent the virus from spreading throughout aircraft and ensure the health and safety of returnees flying from overseas. Thank you.

Hu Kaihong:

Thank you, Mr. Lyu. Next, the floor is given to Mr. Zhang Yang.

Zhang Yang:

Greetings, friends from the media. The NHC attaches great importance to the health and safety of overseas Chinese students. Since the COVID-19 outbreak, we have held news briefings and organized experts for media interviews to answer questions regarding the general concern of overseas students, including the transmission route of the disease and personal protection means. We have also promoted popular science. We have launched a special Q&A column about protecting against the epidemic on our official website and started a column about the COVID-19 on our official Health China accounts on Wechat, Weibo and TikTok. We have also published a series of popular science articles on the NHC's official website and Weibo account, including how overseas Chinese can protect themselves during the epidemic, psychological counseling, and a guide for the public on how to wear face masks. Promoted by Chinese embassies and consulates, these articles have provided technical support for overseas Chinese students to protect themselves from getting infected during the epidemic. The public can easily get access to relevant knowledge and information when browsing NHC's official website and its account on Weibo and Wechat. 

Recently, we dispatched a group of Chinese medical experts to several countries in the fight against the epidemic. During their work overseas, the experts cooperated with local academic institutions and student unions to promote health education for overseas Chinese students through symposium and video-streaming and answer their questions in details. This has been welcomed by overseas Chinese students. Meanwhile, the NHC has instructed the aiding medical teams to play to their strengths and guide local Chinese students on personal protection from the virus. This has played a positive role in protecting overseas Chinese people.

In addition, the NHC has cooperated with the Foreign Ministry to prepare a manual on epidemic prevention included in a charity bag of protective supplies provided for overseas Chinese students. We will do our best to care for overseas Chinese students during the epidemic. Earlier, the Chinese government arranged charter flights and temporary flights to bring back Chinese citizens, including students studying abroad. We have worked with the departments of foreign affairs and civil aviation to equip flights with medical workers and to give emergency medical support on the way home.

Next, the NHC will resolutely implement the decisions and deployments of the CPC Central Committee and the State Council, continue to cooperate with the diplomatic, education and aviation sectors to provide health security for overseas students, assist in the arrangements for returning students and safeguard the safety of their lives and their health. Thank you.

Hu Kaihong:

Thank you, Mr. Zhang Yang. We will now take questions.

CCTV:

Could you please give us more details about the health packs that Chinese diplomatic missions have sent to overseas students? In addition, some of the packs were sent from China using international logistics companies. Could you tell us how logistics transportation will be guaranteed as the international outbreak intensifies?

Ma Zhaoxu:

As I mentioned earlier, many countries are facing a shortage of medical supplies as the epidemic continues to spread, in particular masks, disinfectant and sanitizers which have sold out. In this situation, overseas students and their parents have become worried. The CPC Central Committee and the State Council have paid close attention to the situation, instructing the Ministry of Foreign Affairs, overseas embassies and consulates to provide help to these students. Under the joint support of the finance, education, aviation and national health sectors, each embassy and consulate immediately acted, fully mobilizing all resources to collect and send health packs to students overseas, sparing no effort to solve the practical difficulties they are facing. 

I would like to list some examples. The Chinese Embassy in the United Kingdom held a ceremony for sending health packs. Here is a group photo of Liu Xiaoming, the ambassador to the United Kingdom, alongside student representatives. Ambassador Liu told the representatives that in the face of the fierce outbreak, they are not alone, and that the motherland will always be with them, whilst the embassies and consulates will support them. The health packs have delivered love to every student in the U.K., bringing warmth, health, strength and confidence. The Chinese Embassy in Japan sent out a survey through public platforms to identify needs, sending the first batch of 30,000 masks to over 4,000 students lacking protective equipment. Before the arrival of the health packs from China, the Chinese Consulate General in San Francisco actively collected over 20,000 masks and sent them to students stranded in hard-hit areas. The Chinese Consulate General in Penang, Malaysia, donated masks purchased for their private use, bought some protective supplies locally and prepared the first batch of health packs before the arrival of the ordered supplies, also writing letters of sympathy to the overseas students. The students said that the health packs made them feel the care and love of the Party and government as well as the support and help from their motherland and family. They could truly feel that the embassies and consulates are standing with them, providing a strong backing. 

Next, the Ministry of Foreign Affairs and overseas embassies and consulates will consider the current situation in the students' host countries, continuously sending out health packs to those students stranded by the epidemic in a timely manner, sparing no effort to assist them in the fight against the epidemic, jointly safeguarding their health and safety and overcoming the current crisis.

Lyu Erxue:

At present, Chinese citizens who remain abroad, with overseas students in particular, may have their health and safety exposed to the threat posed by the rapid spread of the pandemic in foreign countries and regions. On March 25, the CAAC embarked on a mission to transport health packs containing hygiene products to Chinese students overseas. This task was assigned in accordance with the requirements made by the Leading Group of the CPC Central Committee on Novel Coronavirus Prevention and Control, the concrete deployments of the joint prevention and control mechanism of the State Council and the general demands provided by the Ministry of Foreign Affairs. The first batch of more than 300,000 packs, weighing 300 tons, will be delivered to 46 Chinese embassies and consulates in 12 countries, namely, Italy, South Korea, France, Germany, the United States, the United Kingdom, the Netherlands, Sweden, Japan, Australia, Canada and Malaysia, before reaching the students. While coordinating with China Airlines and China Eastern Airlines, the CAAC has drawn up a plan with multiple approaches, such as, transporting the health packs in the holds of passenger planes, making full use of cargo aircrafts and refurbishing passenger airliners for cargo services. The delivery of the packs will be prioritized under the joint efforts between the CAAC and the airlines involved to ensure that the necessities can reach our embassies and consulates overseas as soon as possible, as a substantial number of international passenger flights have been suspended. In terms of our latest plan, we will finish delivering the more-than-300,000 packs with an estimated weight of around 300tons, by April 10. By yesterday, we had already flown to the seven countries of Italy, the U.S., France, the UK, Germany, South Korea and Canada, delivering an estimated 116 tons. The CAAC has supported passenger airliners from both home and abroad for use in cargo transportation, opened green access channels and streamlined approval procedures to help the cargo flights complete check-in in a timely manner. That is how we are managing to meet the cargo demand for international aviation.

At the same time, abiding by the concrete deployments of the joint prevention and control mechanism of the State Council, the CAAC has organized and provided help with several humanitarian missions and commercial export cargo deliveries of medical necessities. By April 1, it had conducted 178 chartered flights, sending 100 experts and healthcare personnel and over 2,635 tons of anti-virus supplies to 40 countries, including, the United States, the United Kingdom, Iran, Iraq, Pakistan, Italy, Serbia, Japan and South Korea. Thank you.

CRI:

My question is for Mr. Tian. What measures will the Ministry of Education take to safeguard the legitimate rights of Chinese students overseas, whose studies and lives have been affected by the shutdowns of campuses in some hard-hit countries during the spread of the epidemic?

Tian Xuejun:

The Ministry of Education launched plans as soon as we learned some governments and universities abroad had closed campuses and suspended classes as part of their local anti-virus measures. We asked our embassies and consulates to maintain close contact with our students overseas who study or live within their jurisdictions, to keep informed of relevant arrangements concerning the students and to persuade schools to schedule appropriate academic lives for our students who remain there. In addition, our diplomats have urged these localities to ensure the health, safety and legitimate rights of our overseas students and to help address their difficulties in learning and everyday life. 

Over the past few days, the education departments of embassies and consulates acted immediately by entering negotiations when they learnt that some overseas students had been coerced into moving out of their dormitories. However, most cases have now been solved in appropriate ways. To lend a helping hand to those students in need, some embassies and consulates have prepared temporary quarantined accommodation at the most popular localities for overseas Chinese in pursuit of academic achievement. Meanwhile, full play should be given to the Chinese Student Association whose vital roles can be exemplified by its 95 subsidiaries across the United Kingdom. Organized by the educational department of the Chinese Embassy to the UK, these associations have extended a mutual help network to 71,000 Chinese students via 208 contact points in 56 British cities. Their work has been similar to what Mr. Ma told us has been done in Germany. In addition, we are leveraging the influence of local overseas Chinese societies and Chinese-funded institutes to ensure the overseas students have places to live, sufficient food as well as the necessities and care that they need in their daily lives. Thank you.

Phoenix TV:

My question is to Mr. Ma. We have noticed that many overseas students are struggling with the question of whether they should return or stay. On one hand, they want to continue their studies; on the other hand, they have concerns over the quick spreading of the virus. What advice will the Ministry of Foreign Affairs give to those students, especially for those in the hard-hit countries?

Ma Zhaoxu:

Regarding China's overseas students, first, the number of students studying overseas is quite large. According to the statistics of education authorities, the total number of China's overseas students reaches 1.6 million. Among these, 1.4 million remain abroad now. Second, our overseas students are located in different countries and regions. There are about 410,000 in the U.S., about 230,000 in Canada, about 220,000 in the U.K., about 110,000 in Germany and France, and 280,000 in Australia and New Zealand. There are also 180,000 in Japan and South Korea. These students are widespread. Third, these countries where our students are living are in different phases of the COVID-19 outbreak, and the measures implemented in these countries are also different. Fourth, overseas students are in different situations, so they have varied needs.

Faced with the circumstances described above, we must take them into consideration and implement measures steadily and accurately. The goal is to try everything to ensure that our overseas students are healthy and safe. The Ministry of Foreign Affairs, the Ministry of Education and China's overseas institutions give precise guidelines for overseas students based on different countries' situations. Based on our knowledge, most overseas students have taken the words of advice given by the WHO and China CDC. Following the suggestion of avoiding unessential travel, these students choose to stay where they currently are. This helps to prevent cross-infection caused by their hasty travels. It avoids being stalled in transit countries due to border control restrictions, and it could also avoid possible impact on overseas students' study and visas.

For those students in hard hit countries who do urgently need to return home, the CPC and the Chinese government will take necessary measures in time to help them get home in an orderly fashion. These students should cooperate with civil aviation, ports and local epidemic prevention departments before boarding flights, as well as during time spent on the planes and after crossing the border. And they need to strictly follow the epidemic prevention regulations while being responsible for public safety and their own health. We will continue to follow the requirements and arrangements of the CPC Central Committee and the State Council, take care of and serve overseas students and solve their problems properly. Thank you.

China Daily:

How do overseas students in heavily hit regions, such as European countries and the United States, protect themselves to reduce the risk of infection? For example, many of them are living in rented collective apartments; how can these students avoid cross infection? How can they protect themselves when they go out to shop or perform an essential activity?

Zhang Yang:

No matter what the occasion, overseas students should maintain good personal health habits. They should not spit everywhere, they should cover their mouth and nose with a tissue or their elbow when sneezing or coughing and they should improve hand hygiene and abide by the laws and regulations of the country where they are living. In daily life, they should eat a balanced diet, exercise more, get enough sleep and keep a good state of mind. All these things help to improve their immunity. Meanwhile, they must wear a mask when staying in a crowded or relatively closed environment, such as public transportation, elevators or indoor public places. 

Students who live in a collective apartment should keep their living environment clean and ventilate their rooms often. Experts recommend rooms be ventilated two to three times a day for 20 to 30 minutes on each occasion. They should pay attention to whether their roommates exhibit such symptoms as a fever, cough or other abnormal conditions, and they should take active protective measures. Students should reduce close contact with others who live in the same apartment. If close contact is necessary, wear a mask and keep a distance of at least one meter.

If they go out to shop or perform an essential activity, they should wear a mask when taking public transportation and staying in a crowded or closed environment. They should keep a distance and avoid direct contact when communicating with staff members and carry quick-drying hand disinfectant to keep their hands clean. Thank you. 

Global Times:

At present, due to a massive reduction of international flights, many overseas Chinese students are faced with a situation where it is difficult to purchase a flight ticket back to China. You also introduced that the civil aviation department will start relevant work for overseas charter flights for cities that have concentrated needs and destinations that have the capability of handling charter flights. Has this work started, and how is it going? Thank you.

Lyu Erxue:

I have just mentioned that due to the spread of the COVID-19 pandemic and the requirements of the joint prevention and control mechanism of the State Council, the Civil Aviation Administration of China (CAAC) has issued the "Five Ones" policy, which allows one airline to maintain one air route in one country flying up to one flight per week. Under the policy, the number of international flights has significantly reduced, but at the same time retaining no more than 134 scheduled international flights per week between China and 61 cities in 40 countries outside China. In addition, in accordance with the CPC Central Committee's general requirements for enhancing the care of Chinese citizens abroad and in strict compliance with the specific deployment of the joint epidemic prevention and control mechanism of the State Council, the CAAC has launched a vital air transportation support mechanism in a timely manner for cities that have concentrated needs and the capability of handling travelers and arranged temporary flights to assist overseas citizens in returning home. From March 4 to 26, the CAAC organized a total of 9 temporary flights to assist 1,466 Chinese citizens in returning home from Iran and Italy. Among them, 6 temporary flights were executed in Iran, and 976 passengers were transported home. The majority of them are overseas Chinese students. Three temporary flights have been carried out in Italy, and the fourth one is currently underway, which will transport 180 Chinese citizens back home. The specific route of the fourth flight is from Milan to Wenzhou.

At the same time, according to the unified deployment of the joint epidemic prevention and control mechanism of the State Council, the CAAC officially launched the temporary flight mission to the United Kingdom today. Mr. Ma also just revealed that the first flight has taken off from Shanghai Pudong Airport at 9:30 a.m. this morning and will arrive in London tonight. It is expected to pick up about 180 overseas students. To ensure the prevention of the epidemic and control during the flight, the CAAC adopted a series of targeted prevention and control measures. First, we formulated prevention and control measures for temporary flight missions to countries with a severe pandemic, which provides practical guidance for the protection of people on board. Second, we are working closely with embassy staff and accompanying medical staff of the National Health Commission (NHC) to carry out body temperature screenings and testing before boarding. Third, we will provide special protection and disinfectant supplies for each flight, and medical N95 masks will be distributed to each passenger to minimize the spread of the virus on the aircraft. Fourth, we will take adequate anti-epidemic measures on board, such as ventilation and disinfection. Passengers are seated in separate seats, and the cabins are partitioned to reduce the mobility of people on board. Fifth, we will strictly disinfect the aircraft after each mission to ensure safety before performing other flight missions.

In the next step, the CAAC will strictly follow the task deployments of the joint prevention and control mechanism of the State Council, promptly launch aviation support mechanisms for overseas students who need to return to China from countries that are severely affected by the pandemic, and do an excellent job in transport capacity adjustment, crew arrangements, and onboard prevention and protection to ensure the successful completion of the task of helping overseas students return home. Thank you.

Hong Kong China Review News Agency:

How many overseas Chinese students have been diagnosed with COVID-19? What kind of assistance will relevant departments offer if overseas students are diagnosed with the disease? Thank you.

Tian Xuejun: 

As of March 31, 36 Chinese students studying abroad have been diagnosed with COVID-19, according to Chinese embassies and consulates. After learning that some Chinese overseas students showed signs of infection, Chinese embassies and consulates immediately activated emergency response mechanisms and assisted the students in seeking medical treatment. All of the diagnosed students have received timely treatment, and 11 of them have recovered.

Hong Kong Economic Herald:

Just now, Mr. Ma said the Ministry of Foreign Affairs, along with Chinese embassies and consulates, took active measures to address the problem that some overseas students were stranded in transit due to domestic flight adjustments. What should overseas students do if they encounter such problems in the future? Thank you.

Ma Zhaoxu:

As a result of flight adjustments and other reasons, some Chinese citizens, mainly overseas students, were recently stranded in countries such as Ethiopia, Bangladesh, and Cambodia. As soon as the problem occurred, Chinese ambassadors and consul generals in these countries arrived at airports and made all-out efforts to provide consular protection. After active communication and coordination with airlines, airports and local governments, we made proper accommodation arrangements for the citizens and solved their problems efficiently. The departments of foreign affairs and civil aviation kept close coordination and adopted urgent measures for pressing issues, sending temporary flights to bring home the overseas citizens. They were very satisfied with the solutions, saying, "Thank our motherland. We love our motherland. We love the embassy." These are their true feelings.

Here I'd like to remind overseas Chinese students and other Chinese citizens living abroad to pay close attention to the entry policies of countries while in transit and contact airlines for related information in advance. It is strictly necessary to check your flights, especially connecting flights, with the airlines before buying tickets and boarding. If you get stranded while traveling, please contact local Chinese embassies and consulates for assistance or call the 24-hour consular protection hotline. The Ministry of Foreign Affairs and China's embassies and consulates will do our utmost to provide consular assistance to Chinese citizens. Thank you.

Economic Daily:

If chartered flights are arranged to help overseas Chinese students return home, how can we ensure they are safe during their flight and after they arriving at the airport? Thank you.

Zhang Yang:

Thank you. To make sure they stay healthy, experts suggest that they should carry personal protection equipment with them, such as masks and quick-drying hand sanitizer, if available. They should avoid touching their mouth, nose and eyes with their hands, and they should cover their mouth and nose with a tissue when sneezing or coughing; they can also sneeze into their elbow. Masks should be worn throughout their return trip, except for when they pass through the security check. After completing facial recognition, they should put their masks back on immediately and finish the security check as quickly as possible. Stairs or escalators are preferred, and they should keep at least one meter of distance between themselves and others. Face-to-face communication should also be avoided. If they do choose to take elevators, some distance must be maintained between passengers and crowds should be avoided. They should also pay attention to hand hygiene and avoid directly touching public facilities, such as doorknobs or elevator buttons; if they do, they should wash their hands or use quick-drying hand sanitizer as quickly as possible. Masks should be worn during their flight and while waiting for it, and during this time they should try to eat as little as possible. Thank you.

Hu Kaihong:

The next question will be the last question for today.

China Education Television:

We've noticed that some overseas Chinese students have experienced panic and anxiety due to the pandemic. Could Mr. Tian share with us some suggestions from the Ministry of Education for providing psychological assistance to these students? Thank you.

Tian Xuejun:

You've raised a fairly important question. In terms of psychological counseling, the Ministry of Education has coordinated relevant resources from universities and colleges, making counseling services available to overseas students 24 hours a day. Education administrators in many places and Chinese embassies and consulates in many countries have also set up a helpline for overseas students, providing counseling services for them and their parents in a timely manner. As you may notice, many Chines ambassadors and consul generals have issued open letters to overseas Chinese citizens, and they are also communicating with overseas Chinese students via video chats, building confidence among them amid the pandemic.

We hope that overseas students can set up the concept of preventing the pandemic in a scientific manner, put this concept into practice with the help of Chinese embassies, and build the confidence to overcome it. In accordance with suggestions from the WHO and epidemiologists, we hope overseas students will avoid traveling as much as possible so as to eliminate cross infection. We also hope that these students’ parents and family members who are in China can share with them messages of positive energy that will help them get rid of unnecessary panic and anxiety; meanwhile, they should also do their part in epidemic prevention and control in China. Thank you. 

Hu Kaihong:

Today's press conference is hereby concluded. Thank you all.