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.
