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Read in Chinese

Speakers:

Liu Hua, vice minister of the Ministry of Ecology and Environment, director of the National Nuclear Safety Administration

Guo Chengzhan, vice director of the National Nuclear Safety Administration, head of the Department of Nuclear Facility Safety Supervision of the Ministry of Ecology and Environment

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office

Date:

Sept. 3, 2019

   

Xi Yanchun:

Ladies and gentlemen, good morning. Welcome to this conference. Today, the State Council Information Office released a white paper titled "Nuclear Safety in China" and held this conference to introduce and explain the paper's main content.  

Present at the conference are: Mr. Liu Hua, vice minister of the Ministry of Ecology and Environment, and director of the National Nuclear Safety Administration; and Mr. Guo Chengzhan, vice director of the National Nuclear Safety Administration, and head of the Department of Nuclear Facility Safety Supervision of the Ministry of Ecology and Environment. I'm Xi Yanchun, the SCIO spokesperson. Now, I'll briefly introduce the white paper's main content.

"Nuclear Safety in China" is the first white paper on this topic released by the Chinese government. It introduces the progress of China's nuclear undertakings, states China's basic principles and policies on nuclear safety, shares China's understanding and practices on nuclear safety supervision, and shows China's determination and actions on promoting global nuclear safety governance. Containing approximately 11,000 words, the white paper includes the preface, the main content and the conclusion.

As stated in the white paper, China has always regarded nuclear safety an important national responsibility, and has always developed its nuclear industry subject to safety considerations. China's nuclear industry has always developed in line with the latest safety standards and maintained a good safety record, pursing an innovation-driven path of nuclear safety with Chinese characteristics.

The white paper emphasizes that since the 18th National Congress of the Communist Party of China (CPC), China's nuclear industry has entered a new period of safe and efficient development. President Xi Jinping has proposed a rational, coordinated and balanced nuclear safety strategy, placing equal emphasis on development and safety, and advocating the building of a community of a shared future for global nuclear safety. He has further pointed out the direction for China's nuclear safety for a new era, and provided the Chinese approach to international cooperation in the development and utilization of nuclear energy.

The white paper also stresses that China is an important advocate, promoter and participant in building a fair, collaborative and mutually beneficial international nuclear safety system. China has done a good job in ensuring its own nuclear safety. China has fulfilled its international obligations, and promoted bilateral and multilateral cooperation on nuclear safety. We have actively promoted the peaceful use of nuclear energy for the benefit of all humanity and contributed China's wisdom and strength to global nuclear safety governance. 

The white paper has been published in Chinese, English, French, Russian, German, Spanish, Arabic and Japanese by the People's Publishing House and Foreign Language Press. It will be distributed across the country by Xinhua Bookstore.

That's all for the general introduction. Next, I will give the floor to Mr. Liu Hua, vice minister of ecology and environment. 

Liu Hua:

Ladies and Gentlemen, Friends:

Good morning. Thank you for your long-standing concern and support on issues regarding China's nuclear safety. It is my pleasure to meet with media to introduce and explain the White Paper on Nuclear Safety in China.

Since the beginning of China's nuclear industry, China has always treated nuclear safety as an important obligation of the state. China has always developed the nuclear industry subject to safety considerations, implemented regulations in accordance to the strictest standards. Its nuclear industry has always developed in line with the latest safety standards and maintained a good safety record. Since the 18th National Congress of the CPC, the Party Central Committee with Comrade Xi Jinping at its core, has incorporated nuclear safety in China's national security system. In addition, he has put forward a rational, coordinated and balanced nuclear safety strategy, pointing out the direction for China's nuclear safety for a new era. Under the guidance of this strategy, China has gradually built a nuclear safety governance system with legal norms, administrative regulation, industry self-discipline, technical support, personnel support, cultural guidance, public participation, and international cooperation as its pillars.

"Nuclear Safety in China" is the first white paper released by the Chinese government to comprehensively address the issue of nuclear safety. The white paper introduces China's approach to nuclear safety, elaborates on its basic principles and policies, and shares the concepts and practices of regulation. It also clarifies China's determination and the actions it has taken to strengthen international cooperation on this issue and build a community of a shared future for nuclear safety. 

Xi Yanchun:

Thank you, Mr. Liu Hua. Now, the floor is open for questions. Please identify the news organization you represent before asking questions.

CCTV:

As mentioned in the white paper, China implements a national nuclear safety strategy. What does this entail at present, and how is the work going? Thank you.

Liu Hua:

Thank you. China adheres to the nuclear safety strategy that puts safety first and combines the two goals of development and security. Within the overall framework of the five-year plan for national economic and social development, a nuclear safety plan is formulated and implemented for the matching period. The plan currently implemented is the 13th Five-year Plan for Nuclear Safety and Radioactive Pollution Prevention and Control and Vision for 2025, which analyzes the situation and tasks, clarifies guidelines and principles, and defines target indicators, key tasks and projects for nuclear safety. It is a general plan for coordinating all efforts to ensure nuclear safety from 2016 to 2020.

Last year, we carried out a mid-term evaluation of the 13th Five-Year Plan for nuclear safety. This determined that the set targets had basically been achieved , and the key tasks and projects had been completed on schedule. Generally, the plan has been progressing well.

Liu Hua:

First, our nuclear power plants have maintained a high level of nuclear safety in line with world trends. In the wake of the Fukushima nuclear accident in Japan, we worked out a plan for improving safety management, and a special action plan for the particular year in dealing with nuclear power plant safety management. The statistics of the World Association of Nuclear Operators (WANO) in the past five years show that operating units in China have performed above the world median for more than 80% of the indicators, and have reached the world advanced level for more than 70%. Generally speaking, China ranks in the forefront of the world in this respect.

Second, the safety level of research reactors and nuclear fuel cycle facilities has continued to be enhanced.

Third, progress has been made in the decommissioning of nuclear facilities and the management of radioactive waste.

Fourth, the management of nuclear technology utilization devices has been improved. In China, all radioactive sources are included in safety management, and an online monitoring system for high-risk sources has been established. The accident rate involving radioactive sources has continued to fall.

Fifth, efforts to decommission uranium mining and metallurgical facilities has made significant headway.

Sixth, the supervision of nuclear safety equipment has been further strengthened.

Seventh, overall nuclear security has been further upgraded.

Eighth, the nuclear and radiation emergency response system has been improved.

Ninth, R&D in nuclear safety technology has achieved effective results.

Tenth, the nuclear safety regulatory capacity has been further expanded. 

China Review News Agency (Hong Kong）:

How can we strike a balance between nuclear safety and nuclear energy development? Thank you.

Liu Hua:

Thank you for your question. China has always regarded nuclear safety as a critical part of national security and we have developed nuclear energy and nuclear technology on the premise of ensuring their safety. In the process of nuclear energy development and safety management, we have undertaken the following work:

First, we clarified the division of responsibilities. The Nuclear Safety Law of the People's Republic of China was implemented in January 2018, clearly stipulating this delineation in official responsibilities. Organizations operating nuclear facilities are required to accept overall responsibility for safety. The national nuclear safety regulatory body implements regulation; the nuclear industry and energy authorities are responsible for the management of nuclear safety in accordance with their relevant duties. A mechanism for nuclear safety has been established to coordinate the work of corresponding departments. The Ministry of Ecology and Environment (National Nuclear Safety Administration) is responsible for overall regulation.

Second, exercising nuclear safety governance in accordance with the law. Firstly, the nuclear safety standard established by national regulatory authorities matches the international level because the standard has been set referring to that of the International Atomic Energy Agency and synchronizing with relevant international standards. Secondly, we urge the enterprises to shoulder their full responsibility in ensuring nuclear safety. This can be seen in the process of siting, designing, construction and operation of nuclear power plants. We constantly urge the enterprises to adhere to the principle of putting safety and quality first. Thirdly, strict supervision is exercised. China has implemented a nuclear safety review similar to international practice, and conducts regular rigorous technical reviews.

Third, marked achievements have been made. By June 2019, the Chinese mainland had 47 nuclear power units, 19 operating civil research reactors and critical assemblies, 18 nuclear fuel cycle facilities and two low- and intermediate-level radioactive solid waste disposal sites. We have maintained a good nuclear safety record in regard to every one, ranking among the highest of all countries in ensuring nuclear safety.

In 2000, 2004, 2010 and 2016, the International Atomic Energy Agency (IAEA) conducted four comprehensive reviews of China's nuclear safety regulation system. I would like to brief you the conclusions of IAEA's comprehensive assessment of China's regulatory framework for nuclear and radiation safety in 2016: the effectiveness of regulation is enhanced gradually, and the regulatory framework is increasingly law-based, standardized, internationalized. The overall conclusion was that it is effective and credible.

Reuters:

I'd like to ask what is the current status of the proposed nuclear fuel reprocessing plant in China with France's Areva, with the previous proposed site in Lianyungang abandoned, a work in China due to reassure the public that such a facilities are safe. And also a quick second question. We have some new nuclear reactor approvals early this year. Just wondering what can we expect them of.

Liu Hua:

Thank you for your questions. The first one refers to a project jointly operated by China and France to handle the disposal of spent fuel. The program, which was highlighted and promoted by the two state leaders, is making headway as business negotiations are about to conclude. In addition, we are working together to unify safety criteria and press ahead with cooperation on security supervision. Recently, the project has progressed in line with the planned schedule. In my view, there will be even greater achievements in the treatment of spent fuel with the joint efforts between the two countries.

The disposal of spent fuel, critical to China's closed nuclear fuel cycle, should be handled in reprocessing plants, which will be solely built by us or jointly built by us and France for commercial uses. Related works are in full swing. In this process, we need to communicate with local people and governments concerning various issues, particularly the choice of sites. We need to tell them that the plants, including the site, design, construction and operation, will be safe, and that the plants will not release radioactive waste to their surroundings and endanger local lives. Reprocessing plant is regarded as a nuclear facility in China. There are stringent national safety standards. Thank you.

The second question is about the new projects. Not long ago, the National Energy Administration publicized several new nuclear power projects approved by the State Council earlier this year. All of them are smoothly progressing in the preparatory phase. In the following months, projects like the Zhangzhou nuclear power project in Fujian province and the Taipingling nuclear power project in Huizhou, Guangdong province will start construction after passing the latest security review. Now, they are all in the preparation phase. Thank you.

CNR:

I would like to ask a question regarding public participation. At present, what channels does the public have to access nuclear safety information? In addition, how should the public participate in decision-making involving nuclear safety? Thank you.

Liu Hua:

Thank you. Regarding the participation of the public, we can say that during its development process, nuclear energy has always been plagued by the issue of public participation, which is also known as the problem of not-in-my-backyard (NIMBY). Resolving the NIMBY effect is also a difficult problem in the world and needs to be dealt with in a rational, objective and dialectical way.

On the one hand, public participation reflects the improvement of the public's legal and environmental awareness. On the other hand, it also places higher requirements on our work. Both nuclear enterprises and relevant government departments should strengthen the pre-construction work of nuclear facilities . In the site selection stage and before construction starts, efforts should be made to educate the public more on scientific issues associated with nuclear facilities, release more information to the public and enhance their ability to participate. This should be done to ensure the public's right to know, to participate and to supervise. In addition, the safety status of nuclear facilities in operation should also be disclosed in a timely manner. The Nuclear Safety Law stipulates that the government and enterprises must disclose the safety status of nuclear facilities during the operation process, so we have also made public incidents and accidents in a timely manner through the official government websites. The information can be seen on the official websites of the Ministry of Ecology and Environment and the National Nuclear Safety Administration. At the same time, relevant enterprises should also disclose the operation safety status of their facilities in accordance with the law.

China Daily:

The U.S. imposed nuclear restrictions on China amid U.S.-China trade tensions, and added the China General Nuclear Power Group and several of its affiliates to an entity list. What impact will the U.S. move have on China's nuclear energy development and nuclear safety? And what countermeasures can we take? Thank you.

Liu Hua: 

Thank you for your question. We have noted that the U.S. Department of Commerce added China General Nuclear Power Group and its three affiliates to the department's Entity List in mid-August. By doing so, the U.S. has abused the concept of national security and export control measures. It not only hurts Chinese companies, but also affects businesses in the U.S. and beyond. China firmly opposes the act of the U.S. to undermine the interests of China and other countries through unilateral and protectionist policies. We hope the U.S. will stop its wrongdoing and stick to an equal-footed consultation to find a solution. I also want to state the following four points on China-U.S. nuclear energy and nuclear safety cooperation. 

First, the China-U.S. nuclear energy cooperation is mutually beneficial. Both China and the U.S. are leading countries in the application of nuclear energy and technologies with a complete nuclear industry system. Of course, the U.S. leads the world in nuclear energy and nuclear safety. China has introduced four AP1000 reactor units from the U.S. through substantial bilateral cooperation in nuclear energy. These units have been successfully built, debugged and put into operation in China. This cooperation has benefited companies from both countries and been carried out on a voluntary basis.

Second, the China-U.S. cooperation on nuclear safety over the past 35 years has been agreeable, friendly and effective, and has produced positive results. The two countries have enhanced their nuclear safety levels through mutually beneficial cooperation. As nuclear safety has no borders, I believe the cooperation between the Chinese and U.S. governments in nuclear safety will not be affected despite the trade frictions. 

Third, China has also carried out fruitful nuclear energy cooperation with France and Russia, achieving substantial outcomes in some key projects, including nuclear power plants and spent fuel reprocessing facilities. So we say the U.S. is not the only country China carries out nuclear energy cooperation with. 

Fourth, on the one hand, I believe Chinese companies, in the face of the U.S. nuclear restrictions, will further strengthen research and development, and continue to enhance their capacity in independent innovation. On the other hand, it should be pointed out that the global market for cooperation in nuclear energy is huge. China can cooperate with the U.S. as well as with other countries. Therefore, the U.S. restrictions may ultimately hurt its own businesses. Thank you. 

Phoenix TV

My first question is: If the US adds Chinese companies to its entity list, what impact will it have on China? 

Here is my second question. In the wake of the Fukushima nuclear accident in Japan, we have seen a growing trend towards denuclearization among many countries. Although there were some twists and turns in the past years, most countries have shown continued determination in their denuclearization efforts. As the white paper points out, China has 11 nuclear power units under construction, ranking first in the world. Why does China persist in developing nuclear energy? What is the reason behind China's unstoppable efforts in this regard? One more question. As multiple documents issued by the US and some European countries have indicated, the nuclear waste disposal capabilities of China's nuclear power stations will be stretched to the limit by 2020. Even if China expands its storage facilities, its nuclear waste disposal capabilities will peak in 2035. Can you shed some light on China's current capabilities to dispose of spent nuclear fuels? Thank you. 

Xi Yanchun:

Quite a few questions. Some of them may have been answered just now. Mr. Liu will take the floor.  

Liu Hua:

Thanks. You have asked three questions. Your first question is about America's nuclear 

restrictions on China and their impact on Chinese nuclear companies, which I have already answered. 

Let's go to your second question: Why does China persist in developing nuclear energy? China is a major nuclear country and the development of nuclear energy is an established policy of the Chinese government. Although we have seen a tendency by some countries towards denuclearization after the Fukushima accident, the major nuclear countries in the world, especially the five permanent members of the United Nations Security Council，have been sticking to their policies of developing nuclear energy. A research report from the International Atomic Energy Agency also indicates that, for some countries who want to develop nuclear energy, this is still an important option. China's current coal-dominated energy structure means that we must develop clean and highly efficient energy sources to improve the environment and to win the battle for blue skies. China also has to develop clean energy to adjust its energy mix. 

Secondly, from the perspective of energy security, a big country like China must have multiple energy sources and establish a diversified energy mix. 

Thirdly, from the point of global climate change, we have to curb carbon dioxide emissions. As part of our efforts to protect the environment, we need to include zero carbon energy into our energy mix. Therefore, nuclear energy remains an important option. 

Fourthly, the safe disposal of radioactive waste has always been a matter of importance since China started to develop nuclear energy. As a result, China has made strategic arrangements in the disposal of low- and intermediate-level as well as the high-level radioactive waste. Two factories for the disposal of low- and intermediate-level radioactive waste have been built and are operating safely.

In the next phase, China will build about five more factories for the disposal of low- and intermediate-level radioactive waste in the provinces that have been developing nuclear energy. Meanwhile, China has initiated the underground laboratory project for the disposal of high-level radioactive waste, and R&D work has been underway. The project will soon see some tangible progress. Radioactive waste with high-level radiation will be stored in safe locations far away from human civilization. 

Xi Yanchun:

Now, we come to the last question.

China Radio International (CRI):

My questions are as follows. Five years ago, at the third Nuclear Security Summit in The Hague, President Xi Jinping suggested that we should follow a rational, coordinated and balanced approach to nuclear safety, and he called for the building of a global nuclear security architecture featuring fairness and win-win cooperation. So, what are our follow-up initiatives and what's the latest progress? Thank you.

Liu Hua:

Thank you. In The Hague, President Xi Jinping put forward the vision for building a community of a shared future on nuclear safety, and proposed China's nuclear safety strategy. It should be said that we have made remarkable progress on our work on nuclear safety in recent years.

On the one hand, we are constantly improving the national nuclear safety system.

First, in terms of top-level planning, as I said just now, nuclear safety is part of China's overall national security framework and is written into the National Security Law. We have enacted the Nuclear Safety Law, made medium- and long-term development plans for nuclear safety, and kept the nuclear safety coordination mechanism, which is composed of various departments running effectively. All this is about top-level planning.

Second, in terms of the legal framework, the new Nuclear Safety Law has been implemented since 2018. In accordance with the latest international standards, we have revised and improved relevant Chinese laws, regulations and standards on nuclear safety, and established a legal framework of a strict and high standard on national nuclear safety.

Third, in terms of the system of responsibility, we have created clear lines of responsibility for enterprises. They in turn have launched various activities to ensure the safe operation of nuclear power and strengthened their management in this regard. Enterprises are also required to improve nuclear safety, think about worst-case scenarios, improve their emergency response and make various emergency plans.

Fourth, in terms of the building of nuclear safety capacity, we have enhanced both enterprises' research and development (R&D) in nuclear safety technology and the government's regulation and R&D in this regard. For some important nuclear safety research and development projects, the state organizes joint scientific and technological research.

Fifth, we are working to foster a culture of nuclear safety.

On the other hand, China actively promotes international cooperation on nuclear safety and the establishment of an international system of cooperation on nuclear safety.

First, China has actively acceded to international legal instruments on nuclear safety and fulfilled its due obligations. Over the past years, China has successively acceded to all the international conventions on nuclear safety of the International Atomic Energy Agency (IAEA) and the United Nations, including the Convention on Nuclear Safety, the Convention on Early Notification of a Nuclear Accident, the Convention on Assistance in the Case of a Nuclear Accident or Radiological Emergency, the Convention on the Physical Protection of Nuclear Material, and the Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management. China has fulfilled and acceded to these international conventions and fulfilled its obligations under these conventions.

Second, China gives strong support to the work of the IAEA and upholds the role of the IAEA under the multilateral system. China has provided all-round support to the IAEA, including continuous contributions to the IAEA Nuclear Security Fund. Currently, China is the second largest contributor to the United Nations membership dues and the second largest contributor to the IAEA membership dues. China will continue to contribute to the Nuclear Safety Fund to support nuclear safety capacity-building in Asia and promote the simultaneous improvement of nuclear safety in all other countries.

Third, China actively participates in international exchanges and cooperation. China maintains close contact with the United States, France, Russia, Japan, the Republic of Korea, and Canada as well as the emerging nuclear energy countries along the Belt and Road. China has signed more than 50 cooperation agreements on nuclear safety to increase communication between experts, technological cooperation, and high-level visits. China has also taken part in the Multinational Design Evaluation Program for nuclear power plants, promoted the establishment of a working group on the Hualong-1, and conducted joint international reviews. Through its National Research and Development Center for Nuclear and Radiation Safety Regulation and State Nuclear Security Technology Center, China provides the platforms for developing countries to carry out training and exchange activities related to nuclear safety, raises the safety standard and capacity of all countries, and shares its security experience with other nations. It should be said that through these efforts, we have promoted a comprehensive and continuous upgrading of global nuclear safety standards. That's my answer. Thank you.

Xi Yanchun:

Again, thanks to the two speakers, and thanks to you all. Today's briefing concludes here.

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Read in Chinese

Speakers:

Liu Liehong, vice minister of the Office of the Central Cyberspace Affairs Commission, vice minister of the Cyberspace Administration of China

Chen Zhemin, member of the standing committee of the CPC Tianjin Municipal Committee, head of the committee's Publicity Department

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office

Date:

Aug. 28, 2019

Xi Yanchun:

Ladies and gentlemen, good afternoon. Welcome to this press conference. The 2019 China Cybersecurity Week will kick off soon. To help you get more knowledge about it, today, we are delighted to invite Mr. Liu Liehong, vice minister of the Office of the Central Cyberspace Affairs Commission and vice minister of the Cyberspace Administration of China, and Mr. Chen Zhemin, member of the standing committee of the Communist Party of China (CPC) Tianjin Municipal Committee and head of the committee's Publicity Department, to give you an introduction to the event, and answer some of your questions.

Now, I'll give the floor to Mr. Liu Liehong. 

Liu Liehong:

Ladies, gentlemen, friends from the media, good afternoon. Welcome to this press conference. First of all, please allow me to thank you for your interest in the 2019 China Cybersecurity Week. Now, I'll make a brief introduction of its main events.

In order to implement the principles in the important speech of General Secretary Xi Jinping on further spreading cybersecurity knowledge and skills and on improving people's awareness of cybersecurity and self-protection skills in cyberspace, we are launching the 2019 China Cybersecurity Week with the consent of the leadership of the CPC Central Committee. This event is jointly organized by the Publicity Department of the CPC Central Committee, the Office of the Central Cyberspace Affairs Commission, the Ministry of Education, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the National Radio and Television Administration, the All-China Federation of Trade Unions, the Central Committee of the Communist Youth League, the All-China Women's Federation, and several other departments. Various events will be launched from Sept. 16 to 22 in 31 provinces, autonomous regions and municipalities directly under the central government. The opening ceremony and other important events will be held in Tianjin. 

This year's cybersecurity week will continue to implement General Secretary Xi Jinping's important thoughts on building China's strength in cyberspace. It will focus on the major achievements China has made in the cybersecurity field in the past 70 years since the founding of the People's Republic of China, especially after the 18th CPC National Congress. It will implement related provisions of the Cybersecurity Law and related laws, regulations and standards on data security management and private information protection. It will adopt various means such as launching exhibitions, forums, contests on knowledge and skills, and non-profit advertisements, as well as using various communication platforms like newspapers, radio and TV broadcasting and websites, to encourage enterprises, media, non-governmental organizations and the public to participate in the event, thus spreading knowledge on cybersecurity to a wider audience.

The theme of this year's cybersecurity week is "maintaining cybersecurity for the people and by the people." The main events include the opening ceremony, a cybersecurity exhibition and a forum on cybersecurity technologies.

The opening ceremony will mark the start of the cybersecurity week. Nearly 1,000 guests from government departments, academic institutions, universities, non-governmental organizations, enterprises and media outlets will be present. During the event, a list of teachers awarded for excellent performance in cybersecurity education will be released, and the second batch of universities allowed to establish top-level cybersecurity schools as model projects will also be announced.

The cybersecurity exhibition will showcase the major achievements, latest products and technological advances in cybersecurity fields. Over 100 cybersecurity enterprises and internet enterprises will participate in the event. The exhibition area will cover approximately 23,000 square meters. 

The forum on cybersecurity technologies will provide experts and scholars an opportunity to discuss cutting-edge technologies and the latest technological development trends. There will be a main forum and eight sub-forums on topics like critical information infrastructure protection, cybersecurity standards and industry, and private information protection.

There will also be a closing event, and various themed day events relating to schools, telecommunication, legislation, finance, adolescence and private information protection.

The cybersecurity week has been held successfully for five years and has had a positive social impact. This year, more diverse events will be launched, and more innovative publicity approaches will be adopted. All related local governments and central government departments have been working hard to organize these events.

First, the interaction with the public will be enhanced. An interactive experience zone will be established for the first time in the exhibition venue to attract visitors through new technologies like virtual reality, augmented reality and artificial intelligence.

Second, our approaches toward publicity will be diversified. For instance, the Tianjin municipal government will integrate the cybersecurity week with local culture. A series of publicity events with unique local flavor, like crosstalk shows and a mascot named "Jinxiaowei," will make the education campaign more interesting.

Third, events will be more closely connected to each other. This year, a closing event will be carried out for the first time. During the event, the host city for the opening ceremony and other important events in next year's cybersecurity week will be announced, followed by a hand-over ceremony.

Friends from the media,

The 2019 China Cybersecurity Week will kick off in about two weeks. Currently, all preparations are in full swing. Maintaining cybersecurity is for the people, and this work should also be done by the people. It's the common responsibility of the entire society to keep our cyberspace secure. I sincerely hope the media can give extensive coverage of the week, and people from all walks of life can play an active part in the 2019 China Cybersecurity Week, so as to celebrate the 70th anniversary of the founding of the People's Republic of China by successfully carrying out the event.

Thank you.

Xi Yanchun:

Thanks to Mr. Liu Liehong's briefing. Next I'll give the floor to Mr. Chen Zhemin.

Chen Zhemin:

Ladies and gentlemen, media friends, good afternoon.

This year marks the 70th anniversary of the founding of the People's Republic of China. On the eve of the National Day celebration, the 2019 China Cybersecurity Week will be held in Tianjin. This demonstrates support and trust toward Tianjin, and we feel greatly honored and encouraged. Here, on behalf of the CPC Tianjin Municipal Committee and the Tianjin Municipal People's Government, I would like to express my heartfelt thanks to the Publicity Department of the CPC Central Committee, the Office of the Central Cyberspace Affairs Commission, and the State Council Information Office as well as to all media friends.

The CPC Tianjin Municipal Committee and the Tianjin Municipal People's Government place great importance to this year's China Cybersecurity Week. Comrade Li Hongzhong, secretary of the CPC Tianjin Municipal Committee, has put forth clear requirements. Sixty-two departments of the municipality are working closely together, and all the preparations for the event are progressing in an orderly manner. Just now, Mr. Liu Liehong briefed you on the overall situation and the arrangement for the major activities. Compared with those of previous years, this year's cybersecurity week has the following highlights and characteristics.

First, it is a grand event that is full of dynamism. We will focus on improving the self-developed ecosystem and building a secure and credible system. We will organize the "Fifth Space" Cybersecurity Innovation Competition oriented toward domestic universities and internet enterprises in the forms of CTF (Capture The Flag) attack and defense confrontation, innovative application design and development, and strive to find and train more excellent professionals in cybersecurity. At present, 175 teams from universities and enterprises have registered for the competition.

Second, it is a grand event where people can experience smart technology. We will integrate intelligent elements into each exhibition area, and launch a number of intelligent applications and interactive experiences, such as artificial intelligence (AI), virtual reality (VR) and augmented reality (AR). We will also hold the "black technology" scenario experience activities in the China-Singapore Tianjin Eco-city, so that audiences will have fresh and new experiences.

Third, it is a grand event for all citizens to participate in. We have organized a series of activities in communities, schools and villages to make the event known to every household. We have placed the mascot of the event "Jin Xiaowei" in 85 community e-stations and set up 10 cybersecurity pop-up stores in densely populated areas such as parks and business plazas. We will make use of the postal service and postal savings outlets throughout the countryside to spread the knowledge of internet finance security among people and help them increase their overall awareness of cybersecurity. We also plan to build an "internet central block park," stage a Tianjin-style comedy on cybersecurity, and launch a group of cybersecurity-related activities in forms that people like to see and hear.

Fourth, it is a grand event to publicize cybersecurity in an all-round and multi-faceted way. We will employ all types of resources, and use all sorts of channels like newspapers, the internet, radio, TV, and mobile phones to spread cybersecurity knowledge among the people. We will launch a setting sail ceremony for the cruise ship Wang An (Cybersecurity) and a light show named "Lighting the Haihe River and Starting the Future", build various platforms for network security education, and hold a contest on network security knowledge. All the approaches are to ensure that the message of cybersecurity finds its way deep into the hearts of the people.

All media friends, a grand cybersecurity event with an integration of "conventions, exhibitions, contests and experiences" is approaching. It will gather top professionals, highlight interactive participation, and lead the development of industries. On behalf of the CPC Tianjin Municipal Committee and the Tianjin Municipal People's Government, I sincerely invite you to participate in the 2019 China Cybersecurity Week. Tianjin is ready. We are looking forward to your arrival in Tianjin. Thank you.

Xi Yanchun:

Mr. Chen Zhemin, thank you for your introduction. Now, the floor is open for questions. As usual, please identify the news organization you represent before asking your question. 

CCTV:

My question is for Mr. Liu. Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, has often noted that without cybersecurity, there will be no national security. My question is, what progress has China made on cybersecurity in recent years? What's the current cybersecurity situation in China? And what new measures will we take next? Thank you. 

Liu Liehong:

Thank you for your question. Since the 18th CPC National Congress, the Party Central Committee with Comrade Xi Jinping at its core has given high priority to cybersecurity work. A series of new thoughts, theories, judgements and strategies have been put forward, together forming General Secretary Xi Jinping's important thinking on our national cyber development strategy, which provides basic guidance and strong momentum to China's cybersecurity work. Guided by his thoughts, great progress has been made in China's cybersecurity development. A quasi-system framework of laws, regulations and policies has been developed based on the central role of the Cybersecurity Law. The national cybersecurity system has been improved, cybersecurity capacity and level have been upgraded, which play an important role in safeguarding national security and socio-economic development.  

As to the risks, with the upgrading of information technology, the influence and driving force of the Internet have increased remarkably vis-a-vis China's socio-economic development. This also brings about increasing risks and challenges. Cyber security threats and risks grow day by day; crimes including the underground black industry and telecom fraud occur frequently; problems such as data-insecurity and privacy infringement have become more evident. Organized and intensified cyber attacks targeting critical information infrastructures have become more explicit. Security challenges, both in cyberspace and in the real world, are now intertwined, with cyber-insecurity impacting the real world and security issues in the real world spreading to cyberspace. Cybersecurity concerns are gradually becoming one of the major strategic issues which affect national security, social stability and people's vital interests.

In order to properly carry out the work on cybersecurity, we must thoroughly implement General Secretary Xi Jinping's important thoughts on building China into a cyber power, which entails commitments in the following five areas:

First, we should improve data security management and private information protection. This means we should expedite the issuance of regulations and standards in this area, including data security regulations and evaluation standards for the overseas security of private information. The illegal or delinquent collection and use of private information by various applications will be targeted using a thorough approach. Illegal acts and criminal activities relating to national big data resources and private information will be cracked down on in accordance with the law. 

Second, we should reinforce the protection of critical cyber infrastructure. This means we should speed up the issuance of regulations on the protection of critical cyber infrastructure, hold operators responsible for their main responsibilities, as well as supervisors for their duty to supervise, plan for overall cybersecurity inspection, enhance the situational awareness of cybersecurity, and improve the capabilities of monitoring, early warning and organizing emergency response for situations involving cybersecurity. 

Third, we should incubate and facilitate the growth of cybersecurity technology industry. We are improving the planning and overall layout of cybersecurity technology industry, perfecting policies and measures to support the development of cybersecurity technology industry, and building a list of cybersecurity enterprises that can compete internationally. 

Fourth, we should plan on cultivating cybersecurity talents for the long term. This means we should increase efforts to develop cybersecurity-related educational disciplines, carefully implement the demonstration projects for building top-class cybersecurity schools, accelerate the construction of national bases for innovation and cybersecurity talents. We need to do this to shape a healthy eco-system for talent incubation, technological innovation and industrial development. 

Fifth, we should actively promote the global governance of cyberspace. This means we should, under the guidance of the "four principles" to promote the transformation of the global internet governance system and the "five proposals" to build a community of shared future in cyberspace, both proposed by General Secretary Xi Jinping, deepen practical cooperation with different countries and concerned international organizations, explore cybersecurity issues through dialogues and interactive activities, join hands to tackle the threats and challenges facing cybersecurity, and jointly build the community of shared future in cyberspace.

Thank you. 

Asahi Shimbun:

China upholds its sovereignty in cyberspace and continually strengthens its cybersecurity. However, expats find it very inconvenient to obtain overseas information when living in China. China is getting increasingly closer with the international community while engaging in globalization. My question is: How can China strike a balance between cybersecurity and opening-up in cyberspace? Thank you.

Liu Liehong:

Thanks for your question. China's cyberspace is fully open, and the Chinese government has been promoting healthy and sustainable development in cyberspace. By the end of last year, the number of internet users in China reached 829 million and the internet penetration rate in the country reached 59.6%. With sustainable development, China's internet industry is among the top of the world both in its comprehensive strength and market scale. This has fully proved that China's internet policy is open and the country encourages innovation in the industry. However, the internet is not a lawless zone. While promoting internet development, China must also adopt necessary measures to safeguard the lawful rights of the public and safeguard cybersecurity.

According to international practice, China has introduced laws and regulations, such as the Cybersecurity Law and the Administrative Measures on Internet Information Services, to ensure that the internet is operated and used in accordance with the law. Through law-based management and governance, we will try to create a clean cyberspace and cyber ecology so that the internet can enjoy sound development under the rule of law. Thank you.

China News Service:

My question is about Tianjin. In recent years, a lot of well-known cybersecurity enterprises, such as 360 Security Technology Inc. and Qi An Xin Group, have all chosen Tianjin as home for their headquarters. What advantages does the city have in promoting the development of cybersecurity industries? Why did those companies choose Tianjin? Thank you. 

Chen Zhemin:

Having attracted so many cybersecurity enterprises, Tianjin, in my opinion, must have its own specialties. In other words, the city must possess some exceptional advantages. I think the unique and superior features that Tianjin possesses can be summarized in "one precondition and three environments". "One precondition" refers to the fact that the Tianjin Municipal Committee of the CPC and its government have placed high priority on the development of cybersecurity and informatization. They have done this by resolutely implementing the important thought of Xi Jinping, General Secretary of the CPC Central Committee, to build China's strength in cyberspace, and embracing the notion that "without cyber security, there is no national security; without informatization, there is no modernization." For example, Tianjin has focused on development planning, infrastructure construction and the three-tier (cities, districts and towns) working system. In addition, a big data center has been established and a regulation which aims to promote the application and development of big data has also been passed. The Situation Awareness System has also been used to drive the development of cybersecurity and informatization. Over the past few years, Tianjin has made remarkable achievements and breakthroughs in the development of cybersecurity and informatization, which is the precondition that has attracted those famous cybersecurity companies.

Regarding the three "environments," the first is the industrial environment. There has been a complete industrial chain of cyber-informatization in Tianjin, laying a solid foundation for the development of the cybersecurity industry. I would like to share some statistics with you briefly. In 2018, the revenue of the information technology services industry featuring cybersecurity, big data, the internet and other emerging science and technological fields reached 123.9 billion yuan in Tianjin, making an increase of 29% year on year. The big data industry surpassed 35 billion yuan. The sales of imported goods in cross-border e-commerce were nearly 3 billion yuan, an increase of 155.1% year-on-year. The development of the cybersecurity industry, represented by Phytium Technology Co. Ltd. Tianjin KYLIN Information Technology Co. Ltd. and 360 Security Technology Inc., has become the leader in the national cybersecurity market. The big data and cloud computing industry, represented by Tianhe series supercomputer, Sugon, Tencent and Gbase, has been booming. The application software industry, represented by Keyvia Electic, Cashway Technology Co. Ltd. and Tellyes Scientific, has seen steady growth. Many good companies, such as Perfect World Co. Ltd. Ledo Interactive, Future TV Co. Ltd. and Sohu TV, have gathered in Tianjin, contributing to the steady progress of the digital content industry. The sharing economy based on the internet has seen rapid development, with Caocao Zhuanche and 58 Tongcheng as two major representatives in this field. The e-commerce services industry represented by Vipshop Holdings Ltd, and Meituan is becoming more mature. The internet economy in Tianjin has formed a new landscape featuring industrial clusters, regional connectivity and distinctive characteristics.  

Second, the environment for innovation. A good environment for innovation is a driver of sustainable development for enterprises. Tianjin is home to many well-known universities, including Nankai University and Tianjin University. Three universities including Nankai University set up a cybersecurity discipline. The Tianjin University of Technology led the establishment of a network of cybersecurity and big data disciplines. In general, the city's construction of cybersecurity disciplines is first-class in the country. Tianjin is home to 61 National Enterprise Technology Centers and 609 city-level enterprise technology centers. The comprehensive science and technology innovation index of Tianjin reached 80.75%, ranking third in the country. Its science and technology innovation environment index surpassed 90% for the first time, ranking first in the country. A group of world class tech innovations were created in Tianjin. For example, the Exascale Tianhe-3 supercomputer prototype has been unveiled in Tianjin and will be put into operation next year. This will be the world's largest supercomputer. The production of the 12-inch semiconductor and monocrystalline silicon has broken the international monopoly. And the homegrown high-end chip filled in the blanks. Tianjin is now ramping up efforts to promote research and development of blockchain, big data and a new generation of AI technologies, aiming at building itself into the major source of original innovation in the country. Tianjin is also preparing to build the national innovation base for the cybersecurity industry. It has already built an industrial chain that covers CPU, operation system, database and server. Finally, a PK independent innovation ecosystem has been established.

Third, the business environment. You may notice that, in September 2016, Tianjin mulled over policies focusing on industries and entrepreneurs, aiming to build a business environment with global influence and competitiveness. The city came up with eight opinions, focusing on the protection of the property rights of entrepreneurs. The opinions were widely welcomed by entrepreneurs. Tianjin also published 19 items of policy on promoting the private sector. According to the document, all the administrative fees collected by local government who is authorized to set up standards will be exempted, all the government funds for which local government has the right to set up standards will be exempted, and all the government funds shared by the central and local governments will be exempted. On Sept. 1, the "Regulations on Optimizing the Business Environment in Tianjin" will be released and put into action. The city is creating an efficient, convenient and transparent business environment.

Hong Kong Ta Kung Wen Wei Media Group:

Mr. Liu, I have noticed that the protection of personal information is on the agenda during this year's China Cybersecurity Week. Since personal information leakage occurred now and again, how will the regulatory body act on the problem? Thank you.

Liu Liehong:

As you have mentioned, people have growing concerns over the protection of their personal information, and this issue will be highlighted during the China Cybersecurity Week. We are now working on several major measures to strengthen protection.

First and foremost, top priority is given to the cause of new legislation. We have been building a multi-dimensional legal system with laws and regulations formulated or ratified to strengthen protection. In June 2017, the country implemented the Cybersecurity Law. Now, the Standing Committee of the 13th National People's Congress has placed the Law of Personal Information Protection in their legislative framework. In addition, we have issued the Provisions on the Protection of Children's Personal Information Online and have finished soliciting public opinion on the Measures for Data Security Management and the Measures on Security Assessment of the Cross-Border Transfer of Personal Information.

Second, we have set up standards for the protection of personal information. Under the guidance of the Office of the Central Cyberspace Affairs Commission, the National Information Security Standardization Technical Committee has attached importance to setting up standards for the protection of personal information. It issued the Personal Information Security Specifications and the Security Capacity Requirements for Big Data Services, among others, to strengthen data security management, enhance individual information protection and regulate the collection of personal information. More to the point, the committee has taken a lead in formulating the basic draft standards to regulate the way of collecting personal information by those mobile internet applications.

Third, we have launched special campaigns to crack down on violations. The Office of the Central Cyberspace Affairs Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security and the State Administration for Market Regulation have made concerted efforts to act against apps' illegal collection of personal information. They oversaw the special campaigns targeting over 8,000 complaints posted online and assessing the conduct of more than 400 apps, which are popular or frequently downloaded by users. Among them, over 100 app operators with severe problems received a rectification notice.

Fourth, we have made efforts to publicize the importance of protecting personal information. We will empower people with the basic knowledge of the protection of personal information through various ways and channels. We have exposed illegal conduct and criminal cases, and launched educational programs to raise people's awareness and enable them to distinguish violations. In particular, we will choose a day during the week-long campaign to emphasize the protection of personal information. Thank you.

China Arab TV:

Recently, the Cyberspace Administration of China released several draft regulations on cybersecurity, notably the Data Security Administrative Measures and the Measures for Security Assessment of Personal Information Outbound Transfer. Some foreign companies are concerned about such moves. They are worried that this will lead to higher market barriers, raising uncertainties and operational costs accordingly, thereby putting themselves at a disadvantage. What's your comment on this issue? Thank you. 

Liu Liehong:

Thank you for your question. A short while back, the Cyberspace Administration of China released the draft Cybersecurity Review Measures, draft Data Security Administrative Measures, and draft Measures for Security Assessment of Personal Information Outbound Transfer for public comments. It is necessary to introduce these regulations in order to put the Cybersecurity Law into effect. It is also urgently needed to maintain national cybersecurity and to carry out the necessary work on this issue. In view of the drafting process, these documents have fully respected and adopted the comments and suggestions from all sectors, and the procedures are in line with the WTO rules. The requirements of these documents are not targeted toward any country or region, and treat domestic and foreign products and services equally, with no difference for any country. Thank you. 

China Media Group (China Radio International):

At the 2019 China Internet Media Forum held recently, Tianjin proposed to build a "internet-famous city" for the first time. What is your understanding of the "internet-famous city", and will Tianjin become next "internet-famous city"? Thank you.

Chen Zhemin:

"Internet-famous city" is a buzzword derived with the development of new media, and it is also a fashionable cultural tourism label given by the people, especially the youth, who yearn for a "poetic life". Tianjin is very willing to make itself a "internet-famous city." First of all, with its rich resources in cultural tourism, Tianjin has the foundation and great potential to become an "internet-famous city". It is a national, historical and cultural city and one of China's first outstanding tourist cities. With regard to geographical location, it is situated in the center of the Beijing-Tianjin-Hebei urban agglomeration. The Tianjin Port is the largest comprehensive port in the north and the Tianjin International Cruise Home Port is one of the six major cruise tourism development zones in China. As the saying goes, "if you want to understand modern China, you should understand Tianjin." For more than 600 years since the establishment of the city, especially since 1840, many major historical events related to the country's direction of development either happened in Tianjin, or had a close connection with Tianjin. In particular, the nine concessions made it a unique city with a mixture of ancient and modern elements in both Chinese and western styles. Known as the "city of world architecture", Tianjin has preserved 877 historical buildings. Many historical celebrities once lived in Tianjin, including not only political figures such as Yuan Shikai, Li Yuanhong, Feng Guozhang, Xu Shichang, Cao Kun, Zhang Xun, Duan Qirui, but also prominent cultural celebrities , like Yan Fu, Liang Qichao, Li Shutong, Zhang Boling, Yan Xiu, and Cao Yu. Tianjin is also one of the first areas in China where the local Communist Party branch was established. Li Dazhao, Zhou Enlai, Liu Shaoqi, Zhang Tailei and many other Party leaders once studied and worked in Tianjin. Today, there are still 126 revolutionary sites . In terms of natural ecological resources, Tianjin boasts mountains, seas, rivers, lakes, wetlands and hot springs. Now, the city has two world cultural heritage sites, namely the Great Wall and the Beijing-Hangzhou Grand Canal. It has 28 key cultural heritage sites under the protection of the state, 212 at the provincial level, and 101 national A-level tourist attractions. Last year, the number of tourists in the city reached 230 million, an increase of 8% year-on-year. Its total tourism revenue was 391.4 billion yuan, growing by 10.4% year-on-year.

Second, Tianjin has taken action to build a "internet-famous city". In July this year, Tianjin launched a two-year plan for tourism development, which included 20 initiatives, 20 policies and effective measures . In the following two years, we will strive to "promote tourism across the whole region, improve the quality of tourism, standardize tourism management and maximize tourism benefits". We will build over 50 top-quality tourist routes such as celebrity home tours, cultural exhibition tours and rural leisure tours to enhance quality, increase market share of Tianjin's tourism sector and improve the city's image.

Third, the mission to make the "internet-famous city" a "popular draw" in the long term will depend more on comprehensive factors such as the city's cultural heritage, economic power, and innovation. To achieve that goal, we will continue to work hard. Here, I sincerely invite media friends to visit Tianjin to gain a clearer perspective of the city, introduce the city, and help it become a "internet-famous city". Thank you.

Reuters: 

Recently, Facebook and Twitter removed several hundred accounts from the Chinese mainland. They said these accounts were being used by the Chinese government to disseminate information about the recent Hong Kong protests. Is this true? Has the Office of the Cyberspace Affairs Commission communicated directly with Twitter or Facebook, or will it take any other measures related to this?

Liu Liehong:

Thank you for your question. Chinese media outlets have been reporting a lot about the situation in Hong Kong in an objective and fair manner, so that the facts are obvious. However, very few foreign media outlets treat the righteous voices of internet users and Chinese media with bias, accusing them of spreading "fake news." This practice of turning black into white has put a spotlight on the hypocrisy of some countries' so-called "freedom of speech." If these facts and reasonable voices are considered to be fake news, I think that all those who understand the truth and have a sense of justice will not recognize or agree with it. We have seen that although these accounts have been banned, social networking platforms are flooded with rumors smearing the Hong Kong police and distorting the facts. I think it is self-evident about what the double standard is and who is confusing right and wrong. Thank you.

Xi Yanchun:

The last question.

China Daily:

My question is for Mr. Liu. We have noticed that this is the sixth time the China Cybersecurity Week is being held. Compared with the previous five years', what is the main feature or highlight of this year's event? Can you tell us more about it? Thank you.

Liu Liehong:

Thank you for your question. Mr. Chen and I have introduced some information about this year's highlights and features a while ago. We believe there are three major aspects:

First, the China Cybersecurity Week this year recognizes major achievements in cybersecurity in 70 years since the PRC was founded, especially in recent years since the 18th CPC National Congress in 2012. This is the main theme this time. In recent years, guided by General Secretary Xi Jinping's important ideas on building China's strength in cyberspace, new progress has been made in cybersecurity work, and the capacity to safeguard cyberspace security has been greatly improved. This industry has also seen rapid growth, and the development of disciplines and training of talent have become much more efficient. All these developments have led to a remarkable improvement in the whole society's cybersecurity awareness and safeguarding skills, as well as in China's international voice and influence in cyber space.

Second, this year's Cybersecurity Week focuses on the protection of individual information. Just now we discussed that individual information protection is the feature and also a highlight of this year's event. The Cybersecurity Expo, the Forum for Cybersecurity Technologies, and some themed events during the week this year, such as Individual Information Protection Day, Telecommunication Day, and Financial Day, have made this topic their key component.

Third, this year's event covers multiple fields through various activities. Through online and offline methods, we have organized and completed publicity events related to cybersecurity in nine aspects including community, countryside, enterprises, government agencies, schools, military camps, families, construction fields, and websites. This has greatly encouraged netizens' participation. We are also holding the "Fifth Space" competition for cybersecurity innovation capacity, the "Payment-Clearing Cup" micro-video contest, the National Teenager Cybersecurity Series, the launch ceremony for "Ship Cybersecurity," etc. All these events have fully mobilized the participation of all sectors, and greatly improved the awareness and skills to safeguard cybersecurity. Thank you.

Xi Yanchun:

Thank you, Mr. Chen and Mr. Liu. Thank you, everyone. That ends today's briefing.

Translated and edited by Chen Xia, Li Jingrong, Li Xiao, Liu Sitong, Guo Yiming, Gong Yingchun, Cui Can, Wu Jin, Zhu Bochen, Wang Yiming, Zhang Rui, Zhang Junmian, Li Huiru, Fan Junmei, He Shan, Wang Wei, Wang Qian, Yang Xi, Degen Hill, Kenneth Teh Chiu Soong

Seven experts share their views on the current situation in Hong Kong at a press conference held by the State Council Information Office in Beijing on Aug. 15, 2019. [Photo/China SCIO]

Read in Chinese

Speakers:

Mr. Han Dayuan, director of the Institute for One Country Two Systems, professor of the Law School, Renmin University of China, member of the HKSAR Basic Law Committee of the Standing Committee of the National People's Congress (NPC); 

Mr. Chen Duanhong, professor of the Law School, Peking University, member of the Macao SAR Basic Law Committee of the NPC Standing Committee; 

Mr. He Junzhi, vice dean and research fellow of the Institute for Guangdong, Hong Kong and Macao Development Studies, professor of the School of Government, Sun Yat-sen University; 

Mr. Zou Pingxue, director of the Center for Basic Laws of Hong Kong and Macao Special Administrative Regions, professor of the Law School, Shenzhen University; 

Mr. Zhao Kejin, vice dean and professor of the School of Social Sciences, vice dean of the Institute of Global Development, Tsinghua University; 

Mr. Zhang Jian, director of Hong Kong and Macao Studies, secretary general of the Center for World Parties and Political Studies, the Shanghai Institute of International Studies; 

Mr. Tian Feilong, executive director of Center for Legal Studies in regard to the One Country Two Systems, associate professor of the Institute for Advanced Studies in Humanities and Social Sciences and the Law School, Beihang University.

Chairperson:

Shou Xiaoli, Press Bureau of State Council Information Office

Date:

Aug. 15, 2019

Shou Xiaoli:

Ladies and gentlemen, good afternoon. Welcome to this press conference. In the past two weeks, we have held two press conferences and invited the spokespersons of the Hong Kong and Macao Affairs Office of the State Council to introduce its views and position on the current situation in Hong Kong. The two press conferences have attracted great public attention. Many journalists have told us that they wanted to interview more people coming from more walks of life.

To meet your request, today, we have invited seven experts from related areas of study. They will share their personal views on the current situation in Hong Kong from different perspectives. They are: Mr. Han Dayuan, director of the Institute for One Country Two Systems, professor of the Law School, Renmin University of China, member of the HKSAR Basic Law Committee of the Standing Committee of the National People's Congress (NPC); Mr. Chen Duanhong, professor of the Law School, Peking University, member of the Macao SAR Basic Law Committee of the NPC Standing Committee; Mr. He Junzhi, vice dean and research fellow of the Institute for Guangdong, Hong Kong and Macao Development Studies, professor of the School of Government, Sun Yat-sen University; Mr. Zou Pingxue, director of the Center for Basic Laws of Hong Kong and Macao Special Administrative Regions, professor of the Law School, Shenzhen University; Mr. Zhao Kejin, vice dean and professor of the School of Social Sciences, vice dean of the Institute of Global Development, Tsinghua University; Mr. Zhang Jian, director of Hong Kong and Macao Studies, secretary general of the Center for World Parties and Political Studies, the Shanghai Institute of International Studies; and Mr. Tian Feilong, executive director of Center for Legal Studies in regard to the One Country Two Systems, associate professor of the Institute for Advanced Studies in Humanities and Social Sciences and the Law School, Beihang University.

Now, I will give the floor to Mr. Han Dayuan.

Han Dayuan:

Media friends, good afternoon. Today, there are several experts at this press conference. I am familiar with the focus of their academic studies, so I might act as an informal host on some occasions according to your questions. Now, please allow me to say a few initial words.

Since the proposal to amend two ordinances aroused social controversy in Hong Kong, especially after continuous illegal assemblies and violent acts occurred, the public have felt anxious and uneasy about the present severe situation of Hong Kong. In particular, on the night of Aug. 13, a violent act involving the illegal restriction of personal freedom took place. Some of the illegal assembly participants, against the rule of law, hindered the freedom of exit and entrance of a large amount of Chinese and foreign passengers, assaulted a passenger and a journalist, and even tied up the hands of the journalist. This is an open challenge to the rule of law, and is causing grave damage to Hong Kong's status as a society under the rule of law.

We can see that no one can be safe if the rule of law is damaged and the majesty of the rule of law is lost. The rule of law is a common value of human civilizations. It is the basic way of life in modern society. We need the rule of law because it can guarantee the freedom, dignity and security of all citizens and maintain social order. Meanwhile, an important function of the rule of law is to provide society and the public with a stable expectation. Therefore, the essence of the rule of law is that the government should govern according to the law, citizens should abide by the law, the judiciary should be independent, and existing rules and law procedures should be respected.

It is just on the basis of long-term confidence in the good order, security and freedom ensured by the rule of law that Hong Kong has become the prosperous and beautiful Pearl of the Orient. We have noted the statistics that Hong Kong ranked only around the 60th position globally in terms of the rule of law index in 1996 before its return to the motherland. In 2018, the ranking increased significantly to 16th. The rule of law has become the basic consensus and core value of Hong Kong society, and also the value that Hong Kong people are most proud of. However, the latest series of violent incidents have seriously undermined the value of the rule of law, gone beyond the basic bottom line of a society based on the rule of law, and deeply distressed the whole society and the people of the whole country.

In a society based on the rule of law, freedoms of speech, procession and assembly are strictly guaranteed. The Basic Law of the Hong Kong Special Administrative Region (HKSAR) and the local laws of the HKSAR provide adequate guarantees for the people to exercise these freedoms. However, the exercise of any freedom must follow the requirements of rule of law. For example, Article 17 of the Hong Kong Bill of Rights Ordinance explicitly requires that the right of peaceful assembly must not endanger national security and public safety, or disturb public order. In social life, it is normal that different people hold different political views, different opinions and different demands in regard to governance; if that wasn't true, we wouldn't need the rule of law. The rule of law firstly means a principle of governance and we must respect and abide by effective laws and rules, and act strictly in accordance with what is set by the laws. If we are not satisfied with certain laws and policies, including the government's public policies and laws, we can seek to revise and improve them through legal procedures. If we need a new law in some fields, there is a sound legal process to achieve this objective. However, any political demand that ignores rules, breaks rules and goes beyond the rule of law will ultimately hurt the rule of law.

As we all know, since Hong Kong's return to the motherland, the Constitution and the Basic Law of the HKSAR have jointly formed the foundation of Hong Kong's constitutional order. They clarify the legal status of the HKSAR under "one country," and the relationship between the central government and the region. These provisions are the core essence of the principle of "one country, two systems" and the Basic Law, and also are the foundation of the rule of law in Hong Kong. The primary objective of the principle of "one country, two systems" and the Basic Law is to safeguard national sovereignty, national unification and territorial integrity, and maintain Hong Kong's prosperity and stability. Any act that challenges national sovereignty and national unification breaches the bottom line of the principle of "one country, two systems," and cannot be tolerated by Hong Kong's legal order, either.

Dear media friends, in the face of serious violence and social division, the only way to solve the problem right now is that the whole of society should return to the track of rule of law, protect it and reach consensus in accordance with its provisions. I don't see any other way or method to solve problems but to return to the rule of law. I believe this is also the basic consensus of the vast majority of Hong Kong citizens. After more than two months of turmoil, people are hoping to solve various controversies currently facing Hong Kong society in a legal way. The day before yesterday, the Airport Authority Hong Kong obtained an interim injunction granted by Hong Kong's High Court, under which any person who unlawfully obstructs and interferes with airport operations must bear full legal responsibility. The legal consequences of violating the injunction are very serious. In fact. violators may be convicted of criminal contempt of court.

From such cases, we can see that the airport is beginning to recover and we have confidence in the rule of law in Hong Kong. Although it has been facing serious challenges in recent times, Hong Kong has a deep legal tradition, and the power of the rule of law is able to settle all kinds of disputes, bridge differences, regain consensus, helping Hong Kong society to quickly restore order and public security.

As scholars engaged in study of law and politics, we are also concerned about problems facing Hong Kong and are willing to share with journalists our views concerning the recent situation in Hong Kong, particularly on issues related to the rule of law. Nevertheless, we are scholars, not press spokespersons, so some of our views can only been considered from an academic viewpoint. Thank you.

Shou Xiaoli:

Thank you, Professor Han Dayuan. Now, the floor is open for questions. Please identify the news organization you represent before asking questions.

South China Morning Post:

In response to the anti-amendment movement, the central government has set out two obvious principles. One is to stop violence and chaos, and the other is to unite the people who truly love the country and the HKSAR, and business leaders to condemn violence and establish a line against those who involved in the violence. However, it seems that the two measures have yet to bring about pronounced effect. Today, another group of civil servants said that they will stage a demonstration. My question is, besides the two major principles, are there other measures to be taken to close the social rift and cool down the current situation? The demands expressed in the recent activities have great public support. Is it no longer possible to consider them? Are all of them unacceptable? Thank you.

Zou Pingxue:

Thank you for your question. As you know, since June, the protests and acts of violence related to the amendments in Hong Kong have become increasingly intense, and Hong Kong is facing the most severe situation since its return to the motherland. At the symposium held by the Hong Kong and Macao Affairs Office of the State Council and the Liaison Office of the Central People's Government in HKSAR on Aug. 7, officials of relevant central government departments stressed that currently the most urgent task and overriding priority is to stop the violence and accompanying chaos, and restore order. As Professor Han Dayuan said just now, the rule of law, as one of the core values in Hong Kong and a cornerstone for its prosperity and stability, can safeguard the interests of all Hong Kong people and offer a key competitive edge for future development. I very much agree that heightening awareness of the importance of the rule of law, maintaining its dignity, and restore the rule of law and social order are the best weapons to stop violence and chaos. It is also the broadest common ground reached in the Hong Kong society on how to confront problems, solve conflicts, calm things down and curb violence. As you saw on TV and on the internet recently, violent offenders attacked police officers, besieged the airport, halted traffic, coerced residents to participate in protests and strikes, illegally imprisoned and deliberately hurt others, and wantonly insulted the national flags and the national emblems. Their escalating violent behaviors violate multiple laws in Hong Kong, including the Crime Ordinance, the Offences against the Person Ordinance, the Aviation Security Ordinance, the Public Order Ordinance and the National Flag and National Emblem Ordinance. These acts have severe social impact and serious legal consequences.

Let's review the situation at the Hong Kong International Airport two days ago. Based on international practice, disrupting operation of a key public space, such as an airport, will receive comparatively severe punishment. According to article 15 of Hong Kong's Aviation Security Ordinance, it is an offence of endangering safety at aerodromes for any person to commit, whether by means of any device or otherwise, any act of violence which causes or is likely to cause death or serious personal injury; endangers or is likely to endanger the safe operation; destroys facilities in an aerodrome; and disrupts the services of an aerodrome. Anyone who commits an offence abovementioned is liable on conviction on indictment to imprisonment for life. From a legal perspective, what happened at the Hong Kong International Airport paralyzed its operations by means of illegal rallies, destroying public facilities, and blocking elevators and passages with trolleys. The assaults on mainland passengers as well as Hong Kong police on the evening of Aug. 13 and after midnight constitute a crime.

There are also a number of protestors who think they haven't yet participated in the violence. They believe that it is not against the law for them to just sit there and prevent others from boarding a flight or exiting the airport. The fact is that their behaviors already violate many laws. First of all, they should be considered guilty of the offence of unlawful assembly as stated in Hong Kong's Public Order Ordinance. Actually, it may also constitute the crime of riot under the law of Hong Kong. Based on my research, taking Hong Kong's Public Order Ordinance as an example, if a public assembly or public procession violates regulations, it shall be an unauthorized assembly and disorder in public places according to the article 17A and 17B. In addition, when three or more persons, assembled together, conduct themselves in a disorderly, intimidating manner intended or likely to commit a breach of the peace, they are an unlawful assembly. Therefore, we can see that behaviors such as simply raising hands, using one's body to prevent passengers from leaving the airport or going to other areas as they desire, as well as restricting their freedom of movement, are very likely to be considered as unlawful detention, as stated in Hong Kong's common law.

We notice that on Aug. 14, the Airport Authority Hong Kong obtained an interim injunction to restrain persons from unlawfully and willfully obstructing or interfering with the proper use of Hong Kong International Airport. Any attendance or participation in a demonstration, protest and related public events at the airport is also restrained, except for those in the places designated by the Airport Authority Hong Kong. The police can launch a clearance operation in accordance with the interim injunction. Any breach of the interim injunction or impediment to law enforcement could constitute contempt of court.

During the "Occupy Central" movement in 2014, some groups applied to the court for injunctions. We later found that worked well.

We have seen that, legally speaking, in addition to the measures now adopted, the chief executive and the Executive Council can also issue a series of orders or regulations to restore law and order in accordance with the Public Order Ordinance or the Emergency Regulations Ordinance. When there are some serious acts that endanger social order, for a period of time, public rallies can be banned, the restricted area can be demarcated, a curfew can be imposed and a series of emergency rules or orders can be issued. Therefore, the laws of Hong Kong are very sound and there are many legal resources that can solve current chaos with strict enforcement.

Here I would like to appeal to those who are participating in illegal assembly or procession, especially young students, to think twice. They should understand the serious harm caused by such acts to the legitimate interests, social order and public interests of others, as well as the harmful effects of illegal and criminal activities on their own future. The general public, parents of students and teachers of the universities, as well as major media outlets in Hong Kong, must have a clear-cut stand to resist and oppose illegal acts of violence, as well as resisting and opposing any acts to incite, delude and instigate young people to participate in illegal activities of violence. That's all I want to say. Thank you.

Lianhe Zaobao:

My question is about the definition of terrorism. The Hong Kong and Macao Affairs Office of the State Council said on Monday that a tendency of resorting to terrorism had emerged in Hong Kong, and after the airport violence the day before yesterday, the office voiced condemnation, saying that was almost a terrorist act. However, this definition of terrorism is inconsistent with the one that Hong Kong authorities mentioned at a press conference yesterday. They said that the incident at the Hong Kong airport was serious, but not a terrorist act. I would like to ask the academics and experts present here, what do you think of the issue? What is the definition of terrorism? Furthermore, what measures should be taken to punish terrorists?

Zhang Jian:

The question from Lianhe Zaobao is about a serious issue related to the current situation in Hong Kong that has raised great concerns. Why? It concerns how the central government defines the situation in Hong Kong as well as its overall position on the issues involved. From my point of view, first, I would like to recommend that media friends read an article focusing on domestic terrorism in the United States published in the latest issue of the Time magazine. The general idea is that the law enforcement departments and government officials in the United States right now have become increasingly prone to consider extremely violent acts occurring in its homeland as terrorism. Moreover, it also proposed a number of measures that the U.S. government, including the law enforcement authorities, have taken to address the challenge of such domestic terrorism. Of course, the extremely violent incidents are the main focus. The article also offered some further solutions.   

Why are the extremely violent domestic acts being deemed as terrorism in the U.S.? I believe the media must be very concerned about this issue. We can tell from the news emanating from the United States that the country has been suffering foreign terrorist attacks ever since the "9/11" incidents [in 2001]. Actually, more and more incidents of domestic terrorism have been occurring in the U.S. It indicates it is making domestic national security a priority. As a matter of fact, terrorism in the U.S. stems from extremism and extremely violent acts.

Second, you can search the definitions of terrorism that the United Nations, the European Union, the International Criminal Police Organization and even the Oxford Dictionary offer. All these definitions have one thing in common -- they all define terrorism as the unlawful use of violence and intimidation, or disruptive behavior against national and civilian security, in the pursuit of political aims. 

I discussed the definition of terrorism with some local government officials and academics in Germany and the Netherlands while attending academic exchanges held in the two countries at the end of last year. They generally agreed to consider extremely violent acts occurring in their countries as terrorism. I was surprised by their opinion. We all know that Germany and Netherlands are generally very safe countries within not only the E.U. but even in the entire world. Why did they shift their views? It was all because of the growing number of extremely violent acts that have plagued Germany, the Netherlands, Britain, France and other Western European countries in recent years.

Third, as has been mentioned, the extremely violent acts in Hong Kong over the past week, including the airport incident and petrol bomb attacks on police, have led to serious consequences. The journalist also mentioned the views of the Hong Kong and Macao Affairs Office of the State Council on terrorism. If we analyze the wording of its statement carefully, it didn't say the current situation in Hong Kong is terrorism; it just said it had a tendency of being almost terrorist acts. Words such as "almost" and "tendency" describe the seriousness of the situation, which means the violent incidents in Hong Kong are moving toward this tendency, and if lawful measures are not taken to punish and stop these acts, the violent incidents might flare up into real terrorist acts.

How to stop the extremely violent acts that show signs of terrorism? Let's review the practices of some Western countries. As we all know, the "yellow vests" movement that broke out last year in France continues to these days. In April, the French government rushed through a law to curb violent protests. Hiding one's face while participating in a protest is now deemed a criminal act according to the law. If you refuse to remove the covering on your face, it will be deemed a criminal act, and you will face a sentence of at least one year if convicted. In the West, this is a very grave situation.

In recent days, after violent events occurred in Hong Kong, Hong Kong people from all walks of life have voiced their opposition to such acts. We observe that Hong Kong's response to the incidents is consistent with that of international society. Opposition to violence is an international consensus. How to contain the severe violence occurring in Hong Kong? First, Hong Kong society must have zero-tolerance for such violent acts and must criticize the perpetrators. Second, the Hong Kong law enforcement and judicial institutions must work to ensure strict law enforcement and impartial administration of justice in dealing with the individuals and groups inciting or committing severe violent acts. As we all know, Hong Kong reflects similar social values with the Western world. Western values have gained much appreciation from Hong Kong people from all walks of life. One of the most important aspects of Western values is the rule of law, apart from democracy, human rights, and personal freedom. There is a widespread saying in the United States: "Use of violence during rallies means you lose the right of peaceful demonstration granted to you by the Constitution."

All journalists present today look very young. You may have watched a lot of Hong Kong films and TV series. In the police-themed films and TV dramas, the police often said that Hong Kong has become an international financial center and the safest city in Asia because of the rule of law, which is the core value of the city. Professor Han has talked about this point just now. Therefore, let's focus on the original point. The rule of law is the fundamental solution to address the signs of terrorism shown in the extremely violent acts in Hong Kong.

Hence, stopping violence according to the law is the fundamental solution to address the signs of terrorism appearing in the violent acts being witnessed in Hong Kong, and it is a critical measure to ensure the personal safety of Hong Kong residents, and protect the overall interests of Hong Kong. Thank you.

TVB:

I have a question for you all. Recently, the Chinese People's Liberation Army (PLA) offered a few views on the situation, including that the Standing Committee of the National People's Congress has the right, according to the HKSAR Basic Law, to declare a state of emergency in Hong Kong and introduce national laws in Hong Kong. At this point in time, has the Standing Committee made the decision to do so? If the decision has been made, some Hong Kong residents will be worried that once the PLA conducts operations in Hong Kong, the "one country, two systems" principle will be severely violated, and the situation in Hong Kong may become irremediable. There is another question. One of you just said that we should insist on solving the Hong Kong question by the rule of law, and the public has expressed similar demands. For example, some of them require the chief executive to set up an independent commission of inquiry to get to the bottom of the conflict. However, the chief executive doesn't seem to approve of the idea. Do you think it is the responsibility of the chief executive to do so? Thank you.

Han Dayuan:

Today, experts here have talked a lot about how to return to the rule of law. First, we all know that "one country" is the premise of the "one country, two systems" principle. The unity, dignity and security of the country is the fundamental goal of the principle. Any country would make national security and social unity its top priority. We need to "govern Hong Kong in accordance with the law." That means we should, based on the rule of law, safeguard national unity and sovereignty, always maintain prosperity and stability of Hong Kong, and always safeguard the rights and freedoms conferred on Hong Kong residents by the Basic Law. This is one of basic requirements of the rule of law.

Second, the country has made institutional provisions and legal regulations as precautions to deal with certain situations, according to the international practice and the general principles of the rule of law. As for the question you raised, first, Hong Kong has a complete legal system, including more than 700 laws enacted by the Legislative Council of the HKSAR, the Basic Law, laws previously in force and the national laws listed in Annex III by the National People's Congress through legal procedures. We believe this provides a complete legal system. Second, Article 14 of the Garrison Law makes clear institutional arrangements that when considered necessary, the HKSAR government can send a request to the central government to invite the PLA Garrison to help maintain local public order and engage in disaster relief efforts. The HKSAR government may exert its right to make this request. The Garrison will be deployed to help maintain public order after the central government approves the request. At the same time, the fourth paragraph of Article 18 of the Basic Law stipulates that the Standing Committee of the National People"s Congress has the right to decide that the HKSAR is in a state of emergency, which is clarified in both the Constitution and the Basic Law. The Standing Committee of the National People's Congress has the right to make such a judgment, make the decision and make an announcement. The fourth paragraph of Article 18 of the Basic Law explains that the exertion of this right, in theory, has to meet certain legal standards. When turmoil in Hong Kong endangers national unity or security and is beyond the control of the HKSAR government, the Standing Committee of the National People's Congress may declare a state of emergency. According to the Garrison Law, the PLA Garrison should fulfill its duty following the decision of the central government. This is stipulated by law.

As for the question you just asked, will the implementation of this provision cause the failure of the "one country, two systems" principle? I personally believe that the proper meaning of "governing Hong Kong in accordance with the law" is to safeguard national sovereignty, security and development interests through the rule of law, as well as the prosperity and stability of Hong Kong, and the rights and freedoms of its citizens. There will be strict legal procedures in the event of a legally prescribed situation. Therefore, we emphasize the rule of law, return to the principles enshrined in the rule of law, and solving the problems facing Hong Kong through the rule of law. This is the only way for us.

If you are interested, you can check this yourselves: 35 years ago, Deng Xiaoping said in a conversation with a delegation of Hong Kong and Macao compatriots attending the National Day celebration ceremony that the central government had the right to station a garrison of the PLA in Hong Kong. The Hong Kong Garrison would have another role: to prevent violence and turmoil. Knowing that there are Chinese troops stationed in Hong Kong, people with an intention to instigate violence and turmoil would have to think twice about it. And even if there were turmoil, it could be stopped immediately. When the Basic Law was enacted 35 years ago, many provisions had preventive connotations. We must understand this article in that way. It is one of the legislative intents theoretically speaking.

With regard to an independent commission of inquiry, the rule of law is the core value. Before we respond to any appeal or resolve any social dispute, we must check first whether there are corresponding mechanisms and procedures within the existing system of law. In accordance with the concept of the rule of law, we must give full play to existing legal norms, resources and systems. When one of our systems or a certain norm fails to function properly, we can seek potentially better institutional arrangements. As far as I know, the Independent Police Complaints Council (IPCC) is already operational, and has already received some relevant complaints. You should pay attention to the IPCC. This is a distinctive system in Hong Kong, and we should look at its effects and keep the faith in the operating system, and make sure it functions well. This is my understanding.

China Daily:

In some people's eyes, the latest protest is in an effort to express rational political appeals by infringing the laws. It has been interpreted as "civil disobedience and achieving justice by violating the laws." What do you think about it?

He Junzhi:

We have noted that some people used the concept of "achieving justice by violating the laws" to describe the movement, and this is not the only concept they have adopted to label their violence as legal conduct.

The concept is in no way supported by real and standardized academic principles. Personally, I wonder why some people believe in the things that proved groundless. I have two points to share with you for reference in this regard:

First, based on my research, similar concepts emerged as early as 2011 when some theorists attempted to propose them, including what was later known as "civil disobedience," and "achieving justice by violating the laws" just as you mentioned. Moreover, the effect of those concepts was tested in the illegal "Occupy Central" movement in 2014. Therefore, there are probably some who have been involved in sketching out these theories and making pre-stage rehearsals. However, here is a question -- why do some people buy the concept that obviously contradicts the nature of morality? Therefore, another reason is that the concept that can be easily associated with some authentic theories of "civil disobedience," is proving alluring to some people, who believe they are engaged in a movement based on proven theories. However, if we take a look at the concept of "civil disobedience" in a serious way, the theory is highly conditional with a slew of prerequisites. The two fundamental conditions, which I don't plan to elaborate on here, are, first, the theory should be only targeted at existing illegitimate laws and policies, and second, it should involve only peaceful and non-violent demonstrations. Now, let's analyze this concept. The concept obviously distorts the meaning by taking violence as "violation of laws," which is actually stimulating the emergence of violence.

Let's take a look at examples from previous years. Theoretically speaking, the concept is not accepted in the international academic world or in Hong Kong's own major academic field. Moreover, I have noted a verdict made by a HKSAR court in terms of "achieving justice by violating the laws," based on the two conditions I mentioned before. First, it should be targeted at illegitimate laws and policies, and, second, it should develop in peaceful and non-violent ways. As [the present unrest] fails to reach both of these standards, it is theoretically invalid. The concept has also been vetoed by Hong Kong's judicial practitioners. Therefore, the attempt to give credibility to the concept is theoretically null and pragmatically vetoed. The violence today is obviously influenced by a concept. Therefore, we need to clarify the underlying theories.

Second, I couldn't agree more with all of other speakers. We should only solve questions by resorting to the rule of law.

Bloomberg:

My question is about revising the "one country, two systems" principle and the Basic Law. After the incidents in the past two months, do you think that it is necessary to revise them? If yes, how to do it? Who will initiate the process? Thank you.

Chen Duanhong:

In the past two months, I heard lots of doubts about the specific policies of the "one country, two systems" and the institutional arrangement of the Basic Law. There have also been questions as to whether it is necessary to change some policies, to "tamper with" the Basic Law, or to initiate an amendment procedure? I think we need to reflect on that. While raising such questions, do you think the "one country, two systems" is wrong? If you think so, I want to ask: Where does it go wrong? And which specific statement within it is wrong? When some practices don't work or create controversies, there may emerge a social, political or economic crisis, but not necessarily a constitutional one. We must not mix the two issues.

As for the "one country, two systems," there are actually a broad concept and a narrow one. The narrow concept refers to basic policies. The Basic Law stipulates that the previous capitalist system and way of life shall remain unchanged in Hong Kong for 50 years. Any amendment of the law must not contradict that stipulation, thus constituting a restriction on amendments. Any country would adjust their specific policies due to a political, social or economic crisis. Specific polices are very flexible. So, I think it depends on from which perspective you view the issue. In the fundamental or broad sense, the central government has repeatedly emphasized some points, including the unswerving implementation of "one country, two systems." Here I would like to remind you of one thing: is social crisis equivalent to constitutional crisis? That's what I want to remind you.

Article 159 of the Basic Law stipulates that the power to propose bills for amendments to this Law shall be vested in the Standing Committee of the National People's Congress, the State Council and the HKSAR. However, I can't understand what the current situation in Hong Kong has to do with the amendment of the Basic Law. As to whether it is necessary to adjust some policies in the future, I cannot make such a judgement. It should depend on the judgement of relevant departments themselves. Thank you.

CGTN:

I have a question for you. As we all know, some people say that Hong Kong is of unique significance to China's economy and finance. Now, the demonstrators seem to have the idea of taking advantage of Hong Kong's status as an international financial center to force the central government into submission. What do you think of it? Thank you.

Tian Feilong:

As we know, Hong Kong is an international financial center. In the global financial governance system, there is an expression called "Nylonkong," which refers to New York, London and Hong Kong. When you check the 24-hour global time zone, these three places divide the world exactly into three parts. They are the key nodes of the global financial market order in terms of space and continuity. Large-scale disturbances occurred successively in London and New York around 2011, and we can also study and observe how the U.K. government and the U.S. government as well as the police coped with the riots and violent acts in the financial centers during the two disturbances. The Hong Kong police should also learn from them and adopt a similar standard to deal with and stabilize the status of Hong Kong as a financial center. These can give us a lot of inspiration.

Second, I would like to point out that Hong Kong's status as an international financial center is closely related to the principle of "one country, two systems" and the Basic Law of the HKSAR we established when Hong Kong returned to the motherland. Without them, Hong Kong's status as a financial center will not only be difficult to maintain, but will be even more difficult to consolidate and strengthen. If we haven't forgotten history, we can take a look back. It has been 22 years so far since Hong Kong's return, during which Hong Kong's status as a financial center was actually interfered with and impacted by different forces or in different ways. Some of them were economic in nature, such as major global hot money going short. Others were based on political motives, for example, using the financial center to create political threats. The Asian financial crisis in 1997, the global financial crisis in 2008, the illegal "Occupy Central" movement in 2014, and the anti-amendment movement in 2019 are just four examples of this. Obviously, the crises in 1997 and 2008 were more of the impact that global hot money placed on Hong Kong's status as an international financial center for the purpose of financial arbitrage. The illegal "Occupy Central" movement in 2014 and the anti-amendment movement in 2019 carried obvious political intentions.

Let's review the central government's reaction when Hong Kong's financial system was threatened during these years. Back in 1997, China's economy was fraught with severe difficulties, and we didn't have large foreign exchange reserves. Still, when Hong Kong's financial market faced trouble, the central government offered everything, as much as it could, and spared no effort in propping up the Hong Kong market. As this happened at the very beginning of Hong Kong's return to the motherland, it united the central government, the Hong Kong society and the financial regulatory institutions in both places, and further brought them together as "a community with a shared future for financial security." The 2008 financial crisis also affected Hong Kong. If it hadn't been for the strong and stable economy of the Chinese mainland, I believe that all sectors of Hong Kong and its society would have suffered great losses. With support of the Chinese mainland market and the country, Hong Kong weathered the financial crisis in 2008. As for the incidents happening in 2014 and 2019, they came with very clear political intention. It is ridiculous to undermine the "one country, two system" with Hong Kong's status as an international financial center, since such a position is actually guaranteed by the practice of "one country, two systems." What they are pursuing is actually against their own interests, and this is abnormal and unreasonable.

Whether it is the opposition, the black-clad crowd, or the foreign forces, none of them has thought through Hong Kong's role as a financial center – the financial infrastructure not only for China, but also for economic globalization. Anyone responsible for free trade, economic globalization, and peaceful global development should obligingly and jointly protect Hong Kong's vital role. This is because the infrastructure matters for both China and the rest of the world. If disruption was brought to this financial center, I believe that not only Hong Kong and the rest of China, but also Western countries would be severely affected, especially the U.S. stock market as well as its financial security. Current statistics indicate that due to the continuous violence in Hong Kong, the U.S. stock market and its financial security have already been affected. In this regard, I believe the U.S. decision-makers will make an objective judgement and respond accordingly. In this age of globalization, no country can opt out or is immune to globalizing forces, and we must face this together. In terms of Hong Kong, we should build a consensus that Hong Kong's role as an international financial center cannot exist without the rule of law in Hong Kong. I think all sectors in Hong Kong should listen to reason, reach a consensus on the rule of law to stop violence and chaos and bring back order. Hong Kong's status as an international financial center should be firmly supported by upholding the rule of law. This is my response.

Financial Times:

Last month, the Hong Kong chief executive admitted that the government's work on the amendments was a total failure. Many Hong Kong people can't understand why the central government is still supporting her. If she were a provincial governor or a city's mayor in the Chinese mainland, she would most surely be fired, right? Can you explain why she was not relieved of her duties by the central government? Thank you.

Zhao Kejin:

I'm a researcher on China-U.S. relations. Actually, I've been studying issues relating to Hong Kong for three years now. Why? Because while studying China-U.S. relations, I discovered that the U.S. has spent a lot of energy and resources in Hong Kong. According to U.S. comments, none of the Hong Kong chief executives have done their jobs well. The Americans have been criticizing Hong Kong and Hong Kong's chief executives since Mr. Tung Chee-hwa. But actually, Hong Kong has made many achievements in terms of socio-economic development since its return to China. Each summer, there are Hong Kong students coming to study in the Chinese mainland. We have communicated a lot with them and I found that the majority of them are supportive towards the governance of HKSAR.

On the surface, Hong Kong seems to have problems within, but in fact these issues have profound international origins. As you can see clearly, the focus is no longer about addressing HKSAR's internal problems, but the illegal and violent conduct that is challenging the bottom line of the "one country, two systems." Such conduct is strictly prohibited in Western developed countries. As a Chinese saying goes, "Xiang Zhuang performed the sword dance as a cover for his attempt on Liu Bang's life," which means that someone speaks and acts with a hidden motive. Therefore, without seeing the bigger picture of China-U.S. relations, one cannot uncover the root cause of the Hong Kong question.

While studying China-U.S. relations, I found that the U.S. policy towards Hong Kong is to take advantage of Hong Kong for its own purposes. From the beginning, the U.S. took Hong Kong as part of its Cold War Politics. Before Hong Kong's return to the motherland, the U.S. did a lot of work with the then British-ruled Hong Kong. According to the Foreign Relations Authorization Act for Fiscal Years 1992 and 1993, which was passed in 1991, the U.S. wanted to promote "self-governing democracy" in Hong Kong. In 1992, the U.S. Congress passed the United States-Hong Kong Policy Act, treating Hong Kong as a British colony. Since the U.K. and the U.S. are allies, the U.S. government formed the policy on Hong Kong based on this privilege. However, after Hong Kong's return to the motherland, the U.S. did not change the policy. After its return, Hong Kong was no longer a British colony but a special administrative region in the People's Republic of China. According to international practice, the U.S. should have adjusted its Hong Kong Policy and terminated the United States-Hong Kong Policy Act of 1992, but it didn't. As we all know, as soon as a law is enacted, there will be corresponding institutions and budgets to support it. Therefore, after the 1992 act and since 1995, the U.S. has continued to support and develop opposition forces in Hong Kong through institutions such as the National Endowment for Democracy, in order to promote so-called "democratic development." I also found that every time there was a large-scale demonstration in Hong Kong, not only did Washington try to stir up trouble, but related U.S. organizations in Hong Kong would also pour tens of millions of dollars to support them. So this is the root cause of Hong Kong's current situation. The problems occurring in the HKSAR will naturally be solved through the relevant laws of the HKSAR government. There are relevant procedures to promote this.

As a scholar, I personally believe that at the historical moment when China-U.S. relations have changed, Hong Kong, as the freest economy in the world, has also become the most vulnerable place. Therefore, the most important thing to do to solve the Hong Kong question is to remove the colonial mentality and Cold War mindset that some countries have long held on the Hong Kong question. Do not let them exploit Hong Kong's status as the world's freest economy and make it a bridgehead to further hamper and contain China's development, and do not let them hijack Hong Kong's public opinion in order to achieve their own national interests.

The mainland and Hong Kong should work together to clean up this colonial mentality and the Cold War mindset. As for the economic and social problems encountered in the course of governance, they can sit down and resolve the problems through the relevant procedures and regulations within the system and within the framework of the rule of law, instead of resorting to street violence -- as such violence does not solve any problems. Therefore, as the mainland and Hong Kong are now more closely linked, we must now regard "de-colonization" as a core problem. Once this problem is solved, I believe that all the problems that have arisen in Hong Kong will be solved. Thank you all.

AFP:

Mr. Han, Mr. Zhao said that America may be the "manipulator" behind the protests. Do you have the same view? Do you think there is any actual dissatisfaction among the people of Hong Kong?

Han Dayuan:

Professor Zhao is an expert in China-U.S. relations. He analyzed the Hong Kong question within the framework of international relations, especially that of China-U.S. relations. I am a professor of constitutional law. As I've emphasized earlier, my point of view is that there is no perfect government in any society, nor is there a perfect law. Laws are not flawless. Any government, including that of the United States and France, may face the same situation where problems and public dissatisfaction occur in the course of governing and administration. But we have a sound legal system and sophisticated procedures to solve them. We should make it easier for the public to make appeals and safeguard their rights so that problems can be resolved following effective legal procedures. In the face of Hong Kong's current controversial situation where social consensus has not been reached, the only solution is to return to the rule of law, protect the rule of law, and solve the problem with the rule of law. No matter whether it be for the government or the citizens, I think the problems can only be effectively solved within the framework of the rule of law and through legal channels. To solve the problems and reach a consensus at the same time, and ensure a prosperous and stable society with the rule of law is also what I maintain. It is precisely during this period that we need to cherish the hard-won rule of law tradition in Hong Kong and get Hong Kong back on the right track of the rule of law. Thank you.

Shou Xiaoli:

Distinguished experts, friends from the media, today's briefing concludes here. Thanks to you all. Goodbye!

Read in Chinese

Speakers:

Shohrat Zakir, deputy secretary of the Xinjiang Uygur Autonomous Regional Committee of the Communist Party of China (CPC) and chairman of the Xinjiang regional government;

Alken Tuniaz, a member of the Standing Committee of the CPC Xinjiang Uygur Autonomous Regional Committee and vice chairman of the Xinjiang regional government;

Zhang Chunlin, a member of the Standing Committee of the CPC Xinjiang Uygur Autonomous Regional Committee and executive vice chairman of the Xinjiang regional government. 

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office

Date:

July 30, 2019

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to attend this press conference. This is one of a series being held on the development of provinces, autonomous regions and municipalities directly under the central government to mark the 70th anniversary of the founding of the People's Republic of China.

Today, we are delighted to welcome officials from Xinjiang Uygur autonomous region to speak on the theme of "Building a beautiful Xinjiang, realizing the Chinese Dream." Present with us are: Mr. Shohrat Zakir, deputy secretary of the Xinjiang Uygur Autonomous Regional Committee of the Communist Party of China (CPC) and chairman of the Xinjiang regional government; Mr. Alken Tuniaz, a member of the Standing Committee of the CPC Xinjiang Uygur Autonomous Regional Committee and vice chairman of the Xinjiang regional government; and Mr. Zhang Chunlin, a member of the Standing Committee of the CPC Xinjiang Uygur Autonomous Regional Committee and executive vice chairman of the Xinjiang regional government. They will make a brief introduction of current developments in Xinjiang, and then answer some of your questions.

Now, I give the floor to Mr. Shohrat Zakir. 

Shohrat Zakir:

Good morning, everyone. I am glad to have the opportunity to meet you here. On behalf of the CPC Xinjiang Uygur Autonomous Regional Committee, the regional government, and the people of all ethnic groups in Xinjiang, I would like to express my gratitude to all of you for your long-term attention and support to Xinjiang. I welcome you all to this press conference. 

Xinjiang is situated in the northwestern part of China in the hinterland of the Eurasian continent. It covers a total area of 1.66 million square kilometers, and abuts eight countries. Of all the provincial-level administrative regions in China, Xinjiang possesses the largest area, the highest number of bordering countries, and the longest national land border in China. 

Xinjiang, an amazing and beautiful land, has been an inalienable part of China's territory since ancient times. Covering a large area abundant with various resources, the region has a long history with a profound culture. Inhabited by many ethnic groups and displaying the coexistence of multiple cultures and religions, it serves as an important corridor for East-West cultural exchanges. Since ancient times, the people of all ethnic groups in Xinjiang have lived in harmony, sharing weal and woe. They have jointly developed, built and safeguarded the territory of the motherland, creating an epic of patriotism.

The peaceful liberation of Xinjiang on Sept. 25, 1949, ushered in a new historic era. On Oct. 1, 1949, all ethnic groups of Xinjiang, together with all other Chinese people, witnessed the founding of the People's Republic of China. On Oct. 1, 1955, the Xinjiang Uygur autonomous region was established, opening a new chapter for Xinjiang development. Under the leadership of the Communist Party of China (CPC), and with the support of the whole nation, Xinjiang has forged ahead and worked toward development, progress and prosperity, together with the motherland, delivering remarkable results over the past seven decades.

Since the 18th CPC National Congress in 2012, the CPC Central Committee with Comrade Xi Jinping at its core has attached great importance to work in relation to Xinjiang and all its ethnic groups. Unceasing efforts have been undertaken in this regard. General Secretary Xi Jinping carried out inspection tours to Xinjiang, presided over meetings to study work in relation to Xinjiang, and delivered important speeches and relevant instructions. In May 2014, the Second Central Meeting on the Work of Xinjiang set forth the overall goal of achieving lasting social and political stability in Xinjiang, enriching the Party's strategies for governing Xinjiang in the new era. In 2015, General Secretary Xi Jinping commemorated the 60th anniversary of the establishment of the Xinjiang Uygur autonomous region, expressing his wish to see the building of a beautiful Xinjiang and realizing the Chinese dream. This is also the common aspiration of the whole nation, including everyone in Xinjiang. During the two sessions in 2017, General Secretary Xi Jinping participated in a discussion with the deputies of Xinjiang, sharing his vision for the work being undertaken in Xinjiang, which provided the principles, and became a great encouragement to the next step in our work. We have fully implemented the Party's guiding principles and strategies for governing Xinjiang in the new era. Focusing on the overall goal of achieving social and political stability, we have united the people of all ethnic groups, overcome difficulties, and delivered solid progress, resulting in great changes on both sides of the Tianshan Mountains.

Xinjiang's economic development has realized a historic leap. Its GDP increased from 791 million yuan in 1952 to 1.2 trillion yuan in 2018. Adjusted for inflation, this represents a 200-fold increase, with an average annual gain of 8.3%. Xinjiang's per-capita GDP rose to 49,000 yuan in 2018, from 166 yuan in 1952, and that's approximately a 37.7-fold increase in real terms, averaging 5.7% annual growth.

After 70 years of development, Xinjiang's overall agricultural production capacity and its possession of modernized equipment have notably improved. It has China's biggest production center of cotton, and it also leads the nation in agricultural water-saving irrigation and mechanized farming. The region's industry started from scratch and has formed a fully-fledged modern industrial system. Some production technologies in regard to new energy, new materials and equipment manufacturing have taken the lead domestically and even in the world. More and more modernized cities have emerged as shining pearls in the Gobi desert. Stretching from north to south and connecting the hinterland with the world, Xinjiang's modern comprehensive transportation system has been basically completed. All prefectures and cities are connected by highways. Road network connectivity among administrative villages has reached 99.74%. The length of in-service railways totals 5,959 kilometers. Alongside the rest of China, Xinjiang has also entered the era of high-speed railways, which now links Urumqi to the rest of the country. We have also entered the era of subway, as the subway in Urumqi has already begun operating. There are 21 civilian airports in Xinjiang, and airlines have become the top choice for people to visit us and travel within the region.

In recent years, we have made good use of Xinjiang's geographical advantages, and seized the major opportunities presented by the Belt and Road Initiative. We are committed to promoting openness both at home and abroad, and turning Xinjiang into a key region on the Silk Road Economic Belt, as well as a major window in China's opening to the West. In 2018, Xinjiang's total imports and exports were $20 billion. This is 1,481 times greater than it was in 1950. We have made good use of our unique tourism resources, implementing the strategy of developing Xinjiang through tourism. The potential created by stability is fully utilized as well. Tourism has seen a significant upsurge in recent years. Xinjiang received more than 150 million domestic and foreign tourists in 2018, a year-on-year growth of 40.1%, and 75.89 million tourists visited in the first half of this year, up 46% year-on-year. We expect to receive more than 200 million visitors this year. And we hope to present the charm, prosperity, and stability of Xinjiang to the world.

Second, the living standard of people of all ethnic groups has achieved a historic improvement.

Per-capita income of urban residents jumped from 319 yuan in 1978 to 32,764 yuan in 2018, an average annual growth of 12.3%; that of rural residents went up from 119 yuan in 1978 to 11,975 yuan in 2018, an average annual growth of 12.2%. Xinjiang Uygur autonomous region has greatly improved the clothing, food, accommodation, and transportation conditions of the people of all ethnic groups, ensuring that the problems of hunger, cold, water and power supply shortages, and inaccessibility to the outside world that previously haunted this land a thing of the past.

Since the 18th CPC National Congress, with a stress on people-centered and livelihood-centered development, Xinjiang has, for many years, spent more than 70% of its public budget expenditures on improving public livelihoods and continuously boosting welfare programs focusing on employment, education, medical services, social security and housing etc. Many pressing livelihood issues bearing on the people's immediate interests have been solved. Xinjiang has provided "zero-employment" families with jobs in a timely manner, implemented the policy of free annual physical examination, achieved three-year free pre-school education in rural areas, carried out rural housing projects and built permanent housing for nomadic herdsmen, established a healthcare insurance system to treat critical illnesses, and provided basic living allowances to eligible rural and urban residents. People of all ethnic groups in Xinjiang have enjoyed a stronger sense of gain, of happiness and of security.

To complete the building of a moderately prosperous society in all respects, we are focusing on poverty-stricken areas in the four prefectures of southern Xinjiang and have made clear gains in eradicating poverty. From 2014 to 2018, during a new round of the poverty alleviation campaign, 2.31 million people shook off the shackles of poverty, and the impoverishment rate in rural Xinjiang dropped from 19.4% to 6.1%. By 2020, like the rest of China, Xinjiang will lift its impoverished population totally out of poverty by current set standards. We will leave no one behind. Together with the whole nation, Xinjiang will make great efforts to finish building a moderately prosperous society in all respects within the set timeframe.

Third, our social undertakings have achieved historic breakthroughs.

In the early years after liberation, the net enrolment ratio of school-age children was under 20%, the illiteracy rate was as high as 90%, and the average life expectancy was merely 30 years. Over the past 70 years, we popularized nine-year compulsory education and provided free three-year pre-school education and 12-year basic education in southern Xinjiang. In 2018, the enrolment ratio of kindergartens was 95.95%, and the enrolment ratio of school-age children in primary schools was 99.91%. The central government has also organized Xinjiang Senior High School Class in some of the most developed cities in other provinces to offer better and free education for students from Xinjiang's farming and pastural zones, a scheme that has benefited 110,000 students so far. Xinjiang has also set up a relatively complete county-township-village three-tier disease prevention and health system. The average life expectancy has now risen to 72.35 years.

We highly value the protection and development of traditional ethnic cultures. The Xinjiang Uygur Muqam and Kirgiz epic "Manas" were inscribed on the Representative List of Intangible Cultural Heritage of Humanity and the List of the Intangible Cultural Heritage Requiring Urgent Protection. 

Xinjiang has built a four-tier public cultural service system from the autonomous region down to prefectures, counties and townships. Each county has a cultural center, each township has a cultural station and each village has a cultural hub, enriching people's daily life.

You probably have noticed the exhibition stands set up outside this room. Those Uygur people perform beautiful songs and dances. And there are also local snacks and tourism products from our start-ups in rural areas. Through this, you can enjoy our traditional ethnic culture. All of these display the improved well-being of our people in Xinjiang.

Fourth, we have achieved historical progress in advancing solidarity among all ethnic groups.

We have fully implemented the Party's ethnic and religious policies and the system of regional ethnic autonomy. Xinjiang has cultivated a number of ethnic officials. The right to use ethnic languages and characters of various ethnic groups is fully secured. The law protects and respects the right of every person to freedom of religious belief and participation in religious activities. And the ethnic customs of all shall be respected. All of these aspects have helped to develop and consolidate the new socialist ethnic relationship featuring equality, unity, mutual aid and harmony. In Xinjiang, unremitting efforts have also been made in holding activities promoting ethnic unity and progress. Xinjiang has promulgated the Regulations of Xinjiang Uygur Autonomous Region on the Work of Ethnic Unity and Progress. The exchanges and cooperation between different ethnic groups have been promoted in different areas and manners. People of various ethnic groups are as united as pomegranate seeds.

Xinjiang is enjoying social stability, sustained economic development, a harmonious coexistence of all religions, a better standard of living and solidarity among all ethnic groups. The region is experiencing its most auspicious period of development and prosperity.

The prosperity and progress of Xinjiang cannot be separated from the great support of the central government and the selfless help of all Chinese. From the establishment of the PRC, the total financial subsidies of the central government to Xinjiang have reached 2.35 trillion yuan, including 1.61 trillion yuan alone from 2012 to 2018. In 2018, the financial subsidy of the central government to Xinjiang reached 302.2 billion yuan, accounting for 60.3% of Xinjiang's budgetary expenditures. Since 2010, a total of 19 provinces and various cities in eastern and central China have joined the pairing scheme providing aid to different parts of Xinjiang, with a combined fund of 103.5 billion yuan. And they have also ushered in 1.8 trillion yuan for cooperation projects. Since 1979, the country has sent 15,975 officials to support Xinjiang's development. They work together with all ethnic groups to build a better Xinjiang, thus enjoying the full warmth of the big family of our motherland.

The historic changes that have taken place in Xinjiang over the past 70 years eloquently prove that only through the leadership of the CPC, in the big family of the motherland, the insistence on pursuing socialism with Chinese characteristics, the determined focus on adhering to and improving the system of regional ethnic autonomy, and the joint efforts made to achieve common prosperity and development, has it been possible all ethnic groups in Xinjiang to have a prosperous and progressive present and be able to look forward to a more beautiful future.

The Chinese nation is a family where we are making concerted efforts to achieve our Chinese Dream. At such a historic point in time, we will continue to bear in mind our original aspiration and mission, carry out the Party's Xinjiang governance strategy under the guidance of the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, focus on the overall objective of social stabilization and lasting stability and durable peace, insist on rule of law, ethnic unity and long-term construction in the region, strive to build a united, harmonious, prosperous, civilized, and progressive Xinjiang based on socialism with Chinese characteristics and strive to write a good Xinjiang chapter in the Chinese dream of national rejuvenation. 

Now, my colleagues and I will answer your questions. Thank you.

Hu Kaihong:

Mr. Zakir, thank you for your introduction. Now, let's open the floor to questions.

CCTV:

Just now, the regional chairman said that, by comprehensively implementing regional ethnic autonomy and the Party's ethnic and religious policies, Xinjiang has seen historical progress in ethnic unity. So, how has Xinjiang promoted its ethnic unity? What are the concrete measures and results? Thank you.

Shohrat Zakir:

I will give you a brief introduction to Xinjiang's ethnic policies and ethnic unity situation. 

Xinjiang has been a multi-ethnic place since ancient times. Of 25 million people living there now, among the many ethnic groups present, 13 have resided in Xinjiang for generations. In the 70 years since the founding of the People's Republic of China, especially over the 40-plus years since China's reform and opening-up, Xinjiang has seen people from most of China's 56 ethnic groups establishing a home here. This shows the multi-ethnic nature of Xinjiang. By implementing regional ethnic autonomy in accordance with the law, and resolutely implementing the Party's ethnic policies, Xinjiang has made historic progress in ethnic unity. How do we promote ethnic unity? What measures are implemented to fulfill the Party's policies and regional ethnic autonomy, which is enshrined in the Constitution and other laws? We pay special attention to the following points.

First, we see ethnic unity as the lifeline for people of all ethnic groups. Ethnic unity is the foremost prerequisite [for Xinjiang development]. General Secretary Xi Jinping has told us that we should protect ethnic unity the same way we protect our own eyes. To ensure ethnic equality, the Party has adopted a series of lines, policies, laws and regulations. Besides, Xinjiang has local laws and regulations to guarantee the legitimate rights and interests of each ethnic group. We have worked to ensure that everyone is equal and all ethnic groups get along with each other on equal terms within this big family of the People's Republic of China.

Second, we uphold regional ethnic autonomy. It is a basic component of China's political system. We involve every ethnic group in its implementation. By 2018, among the officials working in Xinjiang's public institutions and businesses, 428,000, or 50.3%, are from minority ethnic groups. In addition, we value the contribution of female officials. Xinjiang now has 233,000 female officials from minority ethnic groups, representing 51.8% of the feminine component. 

Third, we fully respect and protect the rights of all ethnic groups to use their own spoken and written languages and develop their own culture according to the law, while encouraging and promoting the use of China's standard spoken and written language. Xinjiang has newspapers, magazines and other media available in multiple ethnic languages to meet the needs of different groups. Besides, we respect the folk customs of minority ethnic groups, for example their wedding and funeral rites. We do our utmost to see that every ethnic group can maintain its customs and traditions, while accommodating and respecting those of other groups. 

We have kept carrying out education on ethnic unity. With the gradual gain in China's national strength in recent years, it has put poverty relief on the agenda as an important task. As required by the building of a moderately prosperous society in all respects, we have sent over one million officials to different parts of Xinjiang to bond with people of minority ethnic groups, especially those living in poor rural areas. In doing so, we hope to promote exchanges, interactions and friendships among different ethnic groups. What really happens in Xinjiang is that different ethnic groups are closely united like the seeds of a pomegranate that stick together. Thanks for your question.

China Arab TV:

What does the Xinjiang regional government think of the Belt and Road Initiative (BRI)? What cooperation projects are there between Xinjiang and Arab countries under the BRI framework?

Zhang Chunlin:

That's a good question. In order to provide more relevant information, I would like to elaborate on Xinjiang's practices and the progress so far made in building itself as the core region of the Silk Road Economic Belt. The BRI proposed by President Xi Jinping has received worldwide acclaim. In 2014, Xinjiang was designated as the core region of the Silk Road Economic Belt. The regional Party committee and government seized the historical opportunity, took proactive measures and stepped up their efforts to promote the development of the core region. Initial success has been achieved in this regard. The major elements are as follows:

First, we designed development plans to enhance policy coordination. The regional Party committee and government formulated the Guidelines on Construction of Xinjiang as the Core Region of the Silk Road Economic Belt and the Action Plan to Promote Construction of Xinjiang as the Core Region of the Silk Road Economic Belt (2014-2020).

Second, we have persisted in building multiple transportation projects to promote infrastructure connectivity. In terms of road construction, we have opened 111 routes connecting with five surrounding countries. As a result, road transportation from China to Kyrgyzstan and Uzbekistan has been normalized. In terms of railways, Urumqi has been connected to the hinterland's high-speed rail network. The Hami-Ejina and Karamay-Tacheng railways have both begun operation. 

At the same time, we are building three new railways – the Korla-Golmud, Altay-Fuyun-Zhundong and Hotan-Ruoqiang lines. These three railways will add 2,013 kilometers to the growing regional network. In the past five years, a total of 925 kilometers of lines have been built, and now a further 2,013 kilometers are under construction. By 2022, the length of railways in Xinjiang will exceed 8,000 kilometers. 

In terms of aviation, we have either newly built or expanded nine airports. The total number of civil aviation facilities in Xinjiang has reached 21, and three new airports will start construction this year, with another five to follow next year. By 2022, the total number of airports will reach 30. We have not only opened the air route from Urumqi to the surrounding cities, but also routes from Urumqi to the Iranian capital of Tehran, and from Urumqi to Tbilisi, capital of Georgia. In June this year, the route from Urumqi to the Austrian capital Vienna was also opened. This year, we launched the reconstruction and extension project for Urumqi Airport. This project will add two new runways and expand the terminal building by 700,000 square meters. By then, the annual passenger throughput of Urumqi Airport will increase from the current 20 million to 44 million, making it an international hub airport in western China and Central Asia.

In terms of energy, we have built the Hami-Zhengzhou ±800 kV UHVDC transmission project, and the Zhundong-East China ±1,100 kV UHVDC transformer project.

In terms of communication, 17 cross-border optical cables have been put into service in Xinjiang, connecting China with neighboring countries such as Pakistan, Kazakhstan, Tajikistan and Kyrgyzstan.

Third, we continued to pursue mutual benefits and promote trade. Since 2014, we have established 2,451 railway services to link western neighboring countries with an average annual growth of 100%. In 2008, a total of 1,002 railway services were launched in Xinjiang to connect 26 cities of 19 countries in Central Asia and Europe. We have given equal emphasis to "bringing in" and "going global," so as to strengthen international capacity cooperation. For example, the renovation project of a thermal power plant in Kyrgyzstan, undertaken by the Chinese company TBEA, has improved the power supply there; Xinjiang Zhongtai Chemical Co., Ltd. opened its cotton mill in Tajikistan, providing many jobs for local people; Xinjiang Hualing Trade and Industry (Group) Co. Ltd., a private conglomerate, built a shopping mall and industrial park in Georgia and became the largest foreign enterprise there.

Fourth, we boosted financial cooperation and innovation. In 2016, Pakistan's Habib Bank set up a branch in Urumqi. Now, Xinjiang has the largest number of financial institutions among the five northwestern provinces. We have also launched the cross-border RMB business in 98 countries and regions, providing service to more than 2,700 companies so far.

Fifth, we have expanded people-to-people exchanges on a large scale. In science and technology, the Xinjiang regional government, the Ministry of Science and Technology and the Chinese Academy of Sciences launched a pilot zone for innovation-driven development along the Silk Road Economic Belt. As for education, 12,400 foreign students have studied in Xinjiang, and 10 Confucius Institutes have been established in six neighboring countries. In medical treatment and public health, more than 20,000 foreign patients have received medical help here. A total of 29 hospitals in Xinjiang have launched cross-border telemedicine service platforms with 24 large-scale hospitals from three neighboring countries.

Next, we will follow three general ideas: first, to build the Urumqi International Land Port as a landmark project in the core region of the Silk Road Economic Belt; second, to promote construction of the Kashgar and Horgos economic development zones. We will further release stable dividends, give full play to the advantages of the 19 provinces and cities helping Xinjiang in its development, increase investment, and vigorously develop modern industries such as textiles and apparel, electronic product processing, trade and logistics; third, to advance the development of the tertiary industry. We will promote the development of an export-oriented economy to realize transformation and upgrading, and finally achieve overall economic development.

Taking advantages of a dozen ports in Xinjiang, we have been speeding up the development of border zones in order to improve the level of opening up. At present, we have already established sound cooperation with Central Asian countries and will strengthen friendly cooperation with Western Asian and African countries. Currently, TBEA is working on cooperation plans to better serve the power construction of some African countries such as Angola. Thank you.

China Radio International (CRI):

As we all know, Xinjiang has been a region inhabited by multiple ethnic groups since ancient times. May I ask how Xinjiang has protected and inherited the fine traditional culture of all ethnic groups? Thank you.

Shohrat Zakir:

This question will be answered by Mr. Alken Tuniaz.

Alken Tuniaz:

Thank you for your question. The culture of all ethnic groups in Xinjiang has always been deeply rooted in time-honored Chinese civilization, and is an inalienable part of Chinese culture. Xinjiang has always attached great importance to the protection and inheritance of the fine cultural traditions of all ethnic groups. Our main work and achievements are as follows.

First, cultural heritage has been effectively protected and inherited. In 2008, we published the Regulations of Xinjiang Uygur Autonomous Region on the Protection of Intangible Cultural Heritage. Then in 2010, we promulgated the Regulations of Xinjiang Uygur Autonomous Region on the Preservation of the Art of Uygur Muqam. The regulations have scientifically and systematically provided an institutional guarantee for the protection and inheritance of the traditional culture and art of all ethnic groups. By 2018, Xinjiang was identified as being home to one world-class cultural heritage site spread over six places, and five State-level historical and cultural cities, namely Kashgar, Turpan, Yining, Kuqa and Tekes. There are 113 cultural relics protection units at State level, 642 at autonomous region level, and more than 450,000 movable cultural relics collected by 182 State-owned units. At the same time, the Xinjiang Uygur Muqam, Kirgiz epic "Manas," and Uygur Meshrep were respectively included in the Representative List of Intangible Cultural Heritage of Humanity and the List of the Intangible Cultural Heritage Requiring Urgent Protection. All ethnic groups in Xinjiang have their representative intangible cultural heritage included in either State or autonomous region-administered lists.

Second, literature and arts are prospering. Since the founding of the People's Republic of China in 1949, Xinjiang's folk and classical literature has been collected, collated, translated, published and studied. Writers, poets, translators, performing artists, and researchers coming from diversified ethnic minority origins have rapidly matured, forming a multi-ethnic literary, performing and researching contingent. Many of their works have won national and autonomous regional prizes.

Third, traditional ethnic minority sports have been revived and protected. By 2018, the autonomous region had identified and revived 629 traditional ethnic minority sports. The Uygur traditional tightrope-walking known as Darwaz enjoys great repute around the world, being recognized in seven categories as Guinness world record achievements. We have successfully held eight National Traditional Ethnic Minority Sports Meets.

Finally, Xinjiang leads the country in a number of core and key technologies, such as information processing in ethnic minority languages. To help ethnic minorities share the achievements in the era of internet and IT applications, the Chinese government has formulated national standards for coded character sets, keyboards and type matrix of ethnic languages, including Mongolian, Tibetan, Uygur, Kazakh and Kirgiz. A variety of ethnic language typesetting systems and intelligent voice translation systems have been developed to support the orderly development of ethnic language websites and new media. All these efforts aim to make ethnic languages increasingly information-oriented and extensively used in the society. 

Phoenix TV:

Reports have alleged some vocational education and training centers in Xinjiang have detained many Uygurs. Could you verify this? How many have been held at those centers so far? Could you give us a number?

Alken Tuniaz:

Thank you for your question. I can confirm to you that the reports about detaining Uygurs at the vocational education and training centers in Xinjiang are totally false allegations made by some countries and media organizations out of their ulterior motives.

Spokespersons for the Ministry of Foreign Affairs and the State Council Information Office have made detailed introductions about those centers. Establishing vocational education and training centers are the implementation of the UN Global Counter-terrorism Strategy. The effort is based on the reality in Xinjiang, while drawing on the experience of other countries. The government prioritizes safeguarding the fundamental interests of all ethnic groups and aims to explore ways to address deep-seated problems in regard to counterterrorism and de-radicalization. We strive to combat terrorism while protecting human rights, maintain stability while improving standards of living, and balance compassion and severity while taking measures for rehabilitation. Moreover, our counterterrorism efforts do not target any specific region, ethnic group or religion. Achievements have been made in this process. The majority of the trainees have found jobs. Some found employment at local companies and some started their own businesses through preferential policies provided by the local government, which have contributed to poverty relief in the region.

Since last year, the centers have received dozens of visiting delegations with a total of nearly 1,000 members, including media, diplomats, experts, scholars, and religious representatives. After witnessing the operations there, they all recognize and support the successful practices they have seen and think that the practices are worth learning. By July 26, representatives from a total of 50 countries had jointly sent a letter to the UN Human Rights Council to voice their support for the practices. The letter provided a detailed introduction about the centers’ achievements. The number of the trainees is constantly fluctuating. Most of them have now completed their trainings and found employment. I also welcome you to visit the centers in Xinjiang. Thank you.

Reuters:

I have two questions. First, my question goes to Mr. Shohrat Zakir. Could you give us an approximate number about the trainees at those centers? Second, the U.S. Secretary of State Mike Pompeo has described China's policies about these centers as being the "human rights "stain of the century'." What is your comment on this?

Shohrat Zakir:

Your question is similar to the previous one from the Hong Kong journalist. The centers are established and operated in accordance with the law and regulations. In recent years, serious violent terrorist crimes frequently occurred in Xinjiang, especially those committed under the guise of religion. Terrorism, extremism and separatism, the so-called "three evil forces," have created a series of violent terrorist incidents in the region.

Geographically, Xinjiang is located at the center of Asia abutting eight countries, some of which have been suffering with violent terrorist crimes themselves. Under certain foreign separatist influences, some people try to achieve their political goals through organizing violent terrorist crimes. By learning from the effective counterterrorism practices, we want to rehabilitate those who have been influenced by religious extremism or who have been forced to join terrorist groups. For those who have violated the criminal law, we will hold them accountable. For those who have been influenced by evil forces, we will strive to educate and rehabilitate them so that they can understand and obey the laws and regulations.

For those who are jobless and who have not received proper education, we established vocational education and training centers. The centers are by no means "concentration camps." They are established and operated publicly in accordance with the law. The number of trainees there fluctuates. After proper education, people involved may gradually become aware of extremism under the guise of religion and feel sorry for their former misdeeds. 

Some people may say, "I am not well qualified to find a job, and there are no available positions". For such people, we offer education and training courses in three fields to achieve a final goal of employment.

First, they must study the laws. As the citizen of a country, one must abide by the law. This is the most important attribute of human society and advanced civilization. If individual behavior is not restrained by the law, you can imagine what our society would turn into. Therefore, these people must learn their basic rights, responsibilities and obligations. 

Second, the Uygur people in south Xinjiang know little about the standard language of the country. They are unable to work outside their hometown because of the difficulty in communication. For these people, there are training courses covering the simple standard language. It can help them communicate with others, and make them feel part of the local community and the workplace.

Third, they need to learn what is religion and how to practice it. They need to learn how to protect their lawful rights concerning their religious beliefs, how to conduct normal religious activities under the protection of the law, and what is the true meaning of religion. Of course, in the vocational education and training centers, there are believers of other religions besides Islam. They must be able to learn the true meaning of religion.

Last, the goal of eradicating extremism has to be achieved. What we have to avoid is a situation whereby some people cannot distinguish whether a person is conducting extremist activities under the pretext of practicing religion, because, then, they follow such person blindly everywhere and thus can pose a threat to our society. It will do harm not only to these individuals, but also the life and property of others. It will also harm the social order, the unification of our country, and the peaceful and harmonious life of our people.

The trainees can leave the vocational education and training centers at an appropriate time. After study, the majority of them can find suitable jobs that they really like, and they can earn a satisfactory living. These people have become positive social factors, and achieved remarkable success in helping others to find a job and get rich.

As Mr. Alken just introduced, we have received government officials, diplomats, religious figures, officials of human rights organizations and personnel of all walks of life from dozens of countries. When they arrived at Xinjiang, they were allowed to go to any place they wished, including remote areas like Kashgar and Hotan. They could talk with the trainees in the centers. Most of them felt that the center was an excellent creation, and that it could effectively curb violent terrorist acts and the spread of extremism. Today, the society and all people in Xinjiang are focused on shaking off poverty and getting rich, leading a prosperous and happy life, and keeping an inclusive attitude towards other social and ethnic groups. This is a positive change. We welcome journalists, government officials, personnel of all walks of life and religious figures from other countries to go to Xinjiang and take a look personally. You can visit any vocational education and training center anywhere you like. Many centers now are oriented to short-term training on agricultural skills or vocational skills.

Alken Tuniaz:

Please allow me to add some points on this issue. All trainings in the vocational education and training centers in Xinjiang are carried out in accordance with the Constitution of the People's Republic of China and relative laws. The legal rights of trainees should not be encroached upon. No one is allowed to abuse trainees mentally or physically through any means. The personal freedom of trainees must be protected. Trainees can take a few days off if there is a need. They are also allowed to go home regularly. Their right to use the spoken and written language of their ethnic groups must be protected. The lifestyles of their ethnic groups must be protected and respected. The freedom of religion must also be protected. According to the Regulations on Religious Affairs formulated by the State Council, trainees are not allowed to conduct religious activities during their study; however, when they return home, they can resume their religious activities freely under the law. Like any other school, these centers also have venues for cultural and sports activities for trainees to relax in their spare time. 

Not long ago, I went to Kashgar and heard a story from an 85-year-old Uygur man about his son who did all sorts of bad things. In the past, the man wouldn't listen to his parents, abused his wife, forced his sisters to wear full face and body coverings. However, in the vocational education and training center, he learnt the standard language, knew what is allowed by the laws, and acquired some working skills. He then started a business near his home, and even helped other people. After telling me the story, the old man held my hands and extended his gratitude to the Party and the government for saving his son. There are many stories like this in Xinjiang. I hope journalist friends can talk with local people and learn the real changes taking place in Xinjiang. Thank you.

Hong Kong Economic Herald:

My question relates to local tourism. Xinjiang can always remind us of the splendid scenes unfolded by the lonesome pillars of smoke rising from the vast desert and the sinking sun sits round on the endless stream. It is also associated with ancient cites and over one-thousand-year-old populous euphratica forests. It is a merry land in the eyes of Wang Luobin, the late legendary folk songwriter and singer from western China. With such bountiful tourism resources, how do you plan to develop local tourism? Thank you.

Alken Tuniaz:

Thanks for your question. Xinjiang has rich tourism resources with a great potential for development. By the end of 2018, the region had 12 scenic spots rated 5A (the highest rating for Chinese scenic spots), 79 at 4A, and 132 at 3A. Xinjiang is well known for its unique natural scenery. The major destinations include the Heavenly Lake and Tianshan Mountains Scenic Area, divine Kanas Lake, the emerald vineyards of Turpan, the earthly paradise Narat Prairie, the spectacular Koktokay National Geopark, Zepu Jinhuyang National Forest Park in Kashgar and the Tianshan Grand Canyon. Meanwhile, Xinjiang showcases a kaleidoscope of local traditions and customs, featuring diversified folk cultures, arts, sports, costumes and foods. Besides, people of the ethnic groups in Xinjiang are born dancers and singers, and Xinjiang is dubbed the "Home of Songs and Dances".

With the dividends of stability continuing to be unleashed, Xinjiang's tourism has secured rapid growth momentum. Mr. Shohrat has introduced the local tourism industry's performance in 2018 and in the first half this year. Xinjiang will hopefully receive more than 200 million tourists this year as the numbers have been growing exponentially since the beginning of the year. We are fully confident in achieving the growth target.

Regarding your question about the further development of tourism, General Secretary Xi Jinping has pointed out that tourism is a comprehensive industry, a major driving force in economic growth and a bridge to facilitate exchanges and foster friendship among different civilizations and cultures. If tourism is flourishing, it drives other businesses. Based on past achievements, we will follow the important instructions of General Secretary Xi Jinping on tourism development, fleshing out the strategic plan to ensure the region can flourish as a tourist economy, and working to establish it as one of the world's most popular tourist destinations. We are fully focused on developing tourism as a new economic growth point for Xinjiang.

First, we will attach great importance to the role of plans. We'll improve the tourism development master plan and development plans for key areas. Special plans will be formulated for major projects, itineraries and scenic spots. At the same time, we'll foster all-for-one tourism and implement the "Tourism plus" strategy to integrate the development of tourism, culture, sports, transportation, agriculture and the forestry industry.

Second, we will focus on creating famous tourism brands. We aim to fully promote Xinjiang as a top destination for its natural scenery, folk customs, history, culture, resorts and outdoor activities. We plan to develop self-drive tours, land cultivation tours, rural tourism and border tourism. We'll explore ecological tourism in the Altai mountain range, prairie cultural tourism in Ili, folk cultural tourism along the routes of the Belt and Road initiative and golden tourism itineraries surrounding the Tianshan Mountain range. The 561-kilometer-long Duku Highway, which is flanked by mountains, prairies, rivers and forests with beautiful natural scenery all year round, is going viral online. Nowadays, the traffic load there reaches over 13,000 vehicles per day. We're developing all-for-one tourism with tourism circuits covering the entire region. At the same time, we are making efforts in improving and updating the scenic spots to lay a solid foundation for becoming 5A-tourist destinations. In addition, we are boosting the development of traditional tourism products, as well as folk handicrafts, specialties and agricultural and sideline products, in an effort to establish distinctive and popular tourism brands.

Third, we plan to upgrade our tourism services. We will focus on improving services to meet tourists' needs for catering, accommodation, transportation, sightseeing, shopping and entertainment, and apply new technologies, new media and new methods both online and offline to promote local tourism. At the same time, we aim to break transport bottlenecks by accelerating the construction of railways, highways and civil aviation networks.

Fourth, we are boosting construction of transport infrastructure to build a seamless, integrated and faster transport network, and the efforts are already paying off.

Next, we will focus on upgrading the supporting facilities within the scenic spots, especially in the major cities, major tourism towns and villages, and along main highways. We will strengthen regulation of our tourism market and improve our services to improve tourists' satisfaction. We hope that local tourism can eventually become a pillar industry releasing the greatest dividends to help people become rich. We sincerely welcome you media people to take your friends and families to visit Xinjiang and enjoy the remarkable natural scenery there. Thank you.

Guangming Daily:

After listening to your introduction just now, as a Xinjiang native who works outside the region, I am particularly proud of the achievements my hometown has made. My question is about religious work. A high proportion of people of the ethnic minority groups in Xinjiang believe in Islam. How are the legitimate rights and interests on freedom of religious belief guaranteed for religious believers from the various ethnic groups in Xinjiang? Thank you.

Shohrat Zakir:

Indeed, as this reporter has pointed out, there are many religious believers in Xinjiang. First, since ancient times, many religions have spread, evolved and undergone changes in Xinjiang. The ethnic groups living in Xinjiang for generations have held belief in various religions, such as primitive religions, as well as Christianity, Buddhism, and Taoism. Multiple religions have long coexisted in Xinjiang. Especially since the 11th century, Islam has been spreading. Islam has become a religion with relatively more followers in Xinjiang. Therefore, we respect and protect the freedom of religious belief of everyone. 

When the State produced the Constitution, it also clearly stipulated that every citizen enjoys the freedom to believe in, or not to believe in, any particular religion; or to believe in one religion or another. The freedom of religious belief is protected by law. The basic principles of the CPC on religious work are "protecting the lawful, banning the unlawful, containing the extremist, resisting infiltration and punishing crime." Therefore, legal religious beliefs and legal religious activities have always been protected in our country. Religious believers can engage in appropriate religious activities according to their own beliefs. Regarding the number of venues for religious activities, we have a remarkably large number of venues in comparison not only with other provincial regions in China, but also with some areas in the world where the population is similarly large.

Second, we provide management and services for religious affairs. As I said earlier, there are many venues for religious activities in Xinjiang because there are many religious groups. These venues include mosques, churches, Buddhist monasteries and Taoist temples. There are a total of 24,800 venues. Please think about this. We only have about 25 million people in Xinjiang, and not all of them are religious believers. In addition, we also have 29,300 clerical personnel. Among so many venues for religious activities, there are 24,400 mosques for the practice of Islam. I often hear from surprised foreign guests from countries where Islam is the main religion, who say "our population scale is more or less the same, but how do you manage to have more venues than we do?" We fully respect the religious beliefs of all ethnic groups. There is a university in Xinjiang called the Xinjiang Islamic Institute, where students are having undergraduate education just as in normal universities.

As we enhance the management and services for religious affairs, we require venues for religious activities, such as mosques, monasteries, Taoist temples and churches, to ensure absolute safety. The government often allocates funds to help them repair and maintain the facilities, in addition to ensuring basic necessities by providing "seven accesses, two conveniences, and nine equipment," which probably may not be realized anywhere else in the world.

"Seven accesses" means that, any venue for religious activities should have access to water, electricity, desirable road connectivity, supply of natural gas, a communications network, radio and television network, and its own cultural bookstore with religious books or other types of books, newspapers and magazines. All of these need to be available in a mosque.

"Two conveniences" means that ablution rooms and water closets are built. Muslims attending a mosque need to perform ritual ablutions before prayers -- this is what their religion requires. As they pray five times a day, they have to cleanse themselves five times - so we build a place for them to do the ablutions. In addition, we have built water closets. The flushing toilets are easily available in the city, but they can hardly be found in the vast rural areas. However, we make sure to provide these conveniences at venues for religious activities.

"Nine equipment " means that nine kinds of facilities and amenities should be provided. As venues for religious activities are sites for public activities, some people may suffer a heart attack or sudden illness, so we provide medical kits free of charge, as well as electronic displays, and computers. At the same time, according to the size of monasteries, churches and mosques, we equip them with electric fans or air conditioners, especially for the main mosque of a city used for the Friday communal prayer where more people convene. In the smaller mosques, we will provide electric fans, so that people who pray inside will not feel stiflingly hot. What's more, we require that fire-fighting facilities must be equipped, because these are public venues, where a large number of religious believers gather, and, for their safety, there must be means to fight any outbreak of fire. There is also natural gas for conveniently boiling water, or automatic drinking water equipment. Some churches and mosques provide shoe covers -- when it's raining and people step inside with muddy shoes, these covers can ensure cleanliness. There are also lockers for people to store things. These details are meticulously carried out and show our care.

The religious believers are part of the wider society. Great efforts have been made to create a highly clean, comfortable and good environment for them. By so doing, we have guaranteed the normal needs and demands of religious believers.

Therefore, regarding the question just asked about how freedom of religious belief is guaranteed, we can see that first, China legally guarantees one's freedom to believe in, or not to believe in, any particular religion; or to believe in one religion or another. Second, the government has exerted great efforts to guarantee that all venues for religious activities are safe and as comfortable as possible, so that religious believers will feel that by living in such a society and living in a socialist country like China, they can fully enjoy the rights they deserve.

Economic Daily:

Xinjiang, especially southern Xinjiang, is a contiguous poor area, which requires much work on poverty alleviation. My question is: How will Xinjiang achieve the goal of getting rid of poverty on schedule, and building a moderately prosperous society in all respects along with the whole country? Thank you.

Shohrat Zakir:

This question is of great public concern. I would like to invite Mr. Zhang to answer you.

Zhang Chunlin:

Thanks for your question about Xinjiang's economic development and poverty alleviation work. Xinjiang, especially the four prefectures in southern Xinjiang — Hotan, Kashgar, Aksu and Kizilsu Kirgiz, is indeed a contiguous poor area, facing great challenges in poverty alleviation. In 2014, a total of 3,131,800 people from 793,100 households were registered as living beneath the poverty line. Xinjiang had 3,668 poor villages and 35 poor counties at that time. Since the 18th CPC National Congress, under the leadership of the CPC Central Committee with Comrade Xi Jinping at its core, with the strong support from government departments and 19 provinces and municipalities providing paired aid for Xinjiang, the region has fully implemented the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and General Secretary Xi's major expositions on poverty alleviation. Showing great responsibility and perseverance, we have overcome difficulties and achieved initial progress in poverty alleviation. From 2014 to 2018, we lifted a total of 2,314,700 people from 588, 700 households, 2,131 poor villages and 13 poor counties out of poverty. By the end of 2018, the poverty headcount ratio had dropped from 19.4% in 2013 to 6.1%.

With our efforts in the past five years, there were only 204,400 households and 817,100 people living under the poverty line at the end of 2018. The number of poor villages and poor counties has been cut to 1,537 and 22 respectively. All counties in northern and eastern Xinjiang were lifted out of poverty.

In particular, since the 18th CPC National Congress, Xinjiang has gained a wealth of experience in poverty alleviation work. These can be summarized as follows:

First, all localities have shouldered their due responsibilities under the strong leadership of the CPC. Xinjiang made poverty alleviation a top priority and the paramount livelihood project. Party organizations at autonomous region, prefecture, county, township and village levels in Xinjiang have actively participated in the poverty alleviation work. Party secretaries shoulder the most important task, and work to enhance the CPC leadership. Xinjiang also set up a Leading Group of Poverty Alleviation and Development, and a Leading Group of Poverty Alleviation in Poverty-Stricken Areas, with Chen Quanguo, secretary of the CPC Xinjiang Uygur Autonomous Regional Committee and Shohrat Zakir, chairman of the Xinjiang regional government, as the leading figures. A total of 52 leaders at the provincial level have been active in the work of connecting poor counties, villages and households. In particular, Mr. Chen and Mr. Shohrat Zakir have visited all the poor counties and guided the poverty alleviation work themselves. Meanwhile, a deputy Party secretary and a vice chairman of the regional government have been appointed to be in charge of the poverty alleviation work. For example, as the executive vice chairman of the government, I make economic development and poverty alleviation work as my top priority. In the four prefectures in southern Xinjiang — Hotan, Kashgar, Aksu and Kizilsu Kirgiz, a deputy Party secretary was also required to work on poverty alleviation with a vice head of the local governments at prefecture, county and township levels. In addition, Xinjiang sent a number of major secretaries and working groups (including five to seven members) to 3,668 poor villages to help with the local poverty alleviation work. 

Second, we will adhere to objective standards to strengthen policy support and ensure availability of adequate funds. Budgetary input is crucial to winning the battle against poverty, and we are coordinating various resources and promoting our strength to ensure budget sufficiency. In 2016, the budgetary input for Xinjiang's poverty-alleviation work totaled less than 4 billion yuan. However, in recent years, we have been increasing the amount. I will share two of these numbers in this regard with you today. In 2018, all categories of budgetary input for poverty-alleviation work in Xinjiang reached 33.41 billion yuan. In the first half of 2019, a total of 38.152 billion yuan has been channeled into poverty alleviation, among which those for four prefectures in southern Xinjiang reached 35.946 billion yuan, or 94.22% of the total. As the most severe poverty-stricken areas, these four prefectures have become the priority of our poverty-relief funding. At the same time, we have strengthened policy support. This is demonstrated not only by our determination to win the battle against poverty, but also through drawing up the "13th Five-Year Plan for poverty alleviation in Xinjiang" and the "Implementation Plan (2018-2020) of Poverty Alleviation in Poverty-stricken Areas in Four Prefectures in Southern Xinjiang.

Third, we will continue to adhere to targeted poverty alleviation policies. The policy of "seven paths to alleviate poverty" has delivered solid progress in Xinjiang. Based on General Secretary Xi Jinping's concept of "targeted poverty alleviation in six aspects", designed to adapt poverty relief measures to local conditions, we are following a policy of the policy of "seven paths to alleviate poverty," and have made breakthroughs in leveraging local industry and employment to alleviate poverty. Now, I will introduce these "seven paths to alleviate poverty" in detail.  First, is to alleviate poverty by relocating surplus employment. We have been implementing a plan to relocate 100,000 surplus laborers to northern Xinjiang, to the Xinjiang Production and Construction Corps., as well as to other parts of China. Up to now, the employment of 96,500 people living in poverty through relocation has helped lift a total of 289,500 people out of poverty.

Second, is the way to alleviate poverty by supporting the development of local industry. We have been focusing on labor-intensive industries, such as textiles, garments, and the assembling of electronic products. We have also been developing jobs in the planting and breeding sectors, folk handicrafts, as well as rural tourism. Poverty-alleviation workshops have been built to help people living in poverty find jobs in places close to home. A total 372,400 people have been lifted out of poverty. In the first half of 2019, Hotan prefecture alone has introduced 27 shoe manufacturing businesses. This industry has created 11,000 employment opportunities in the county, among which 3,460 employees previously lived in poverty. On July 24 and 25, a convention on shoe manufacturing was held in Hotan, gathering more than 30,000 enterprises. Shoes manufactured there are now being exported to Russia and parts of Europe. 

The third route is to use land revenue to pay the labor of people living in poverty. As all the people living in poverty is qualified for this policy, a total of 512,100 job opportunities have been created.

Fourth is to create job opportunities in the civil service, such as border guards. This is aimed at people in poverty-stricken counties along the border. So far, some 50,000 people have found jobs in this regard.

Fifth is to promote poverty alleviation through ecological compensation, and this is targeted at grassland rangers. Around 58,000 people have been lifted out of poverty through this approach.

Sixth is to relocate people from inhospitable areas. A total of 35,000 households, involving 160,000 people in total, have been relocated to industrial parks in counties, away from areas with a fragile environment, such as places around deserts and mountainous regions. Such relocation has greatly contributed to poverty alleviation.

Seventh is to ensure that social security policies meet basic needs of the people living in poverty. This is aimed at some 320,000 people with severe disability, as well as the elderly with no kin to support them. In 10 years from now, we will prepare 2 billion yuan out of our fiscal income every year and use it to back up our social security policies.

Fourth, we have intensified efforts to improve access to education, medical care and infrastructure. We made it our goal to ensure Xinjiang people do not have to worry about food and clothing and have guaranteed access to education, medical care and housing. First, children from poor families in Xinjiang now enjoy free, equal and high-quality education from kindergarten to high school. Second, we have set up a universal urban and rural medical insurance system. Local people can receive convenient medical treatment at multi-level hospitals from countryside to big city. Thanks to the help of other provinces and municipalities, even hospitals at 22 extremely poor counties are able to offer heart surgery. Let me tell you a story. One of our colleagues suffered a heart attack while working at a rural town and needed to have a stent installed in his heart immediately. Instead of sending him to big hospitals in Urumqi, a local hospital finished the surgery through telemedicine and remote consultation. Third, we have improved working and living conditions by accelerating construction of rural roads, provision of safe drinking water and comfortable housing.

Fifth, we have coordinated efforts to alleviate poverty. Besides professional, industrial and social poverty alleviation, Xinjiang also has relief aid from other provinces and municipalities. A total of 249 units at autonomous region department level in Xinjiang paired up with 279 poverty-stricken villages; 16 central state-owned enterprises assisted 27 poverty-stricken counties; 33 relatively developed counties in northern and eastern parts of Xinjiang helped 27 counties in the southern part; 1,240 enterprises provided support to 1,276 poor villages; 1.12 million officials paired up with 1.69 million households to help them get rid of poverty. During the first half of this year, 12.268 billion yuan of Xinjiang-aid funds was spent on poverty alleviation through 970 projects.

These five points set out here are our basic experience. At present, our poverty alleviation efforts have yielded decisive results. Among 22 deep poverty-stricken counties in southern Xinjiang, we plan to lift 12 out of poverty in 2019 and another 10 in 2020. In order to implement the important instructions of General Secretary Xi Jinping when he presided over a symposium about solving prominent problems, including meeting the basic needs of food and clothing and guaranteeing compulsory education, basic medical care and housing, which was held in Chongqing on April 16, 2019, Xinjiang Uygur Autonomous Region Committee of the CPC held a plenary meeting in late June, at which nine directions were clarified for the next-phase of work concerning poverty alleviation.

The first direction is to address identified weak links. We decided this was the necessary starting point for our ongoing work. After an investigation, we found a total of 9,355 households in Xinjiang still lacked safe housing. Construction of the necessary facilities has been started. At the same time, we found that 24 villages in five counties lacked any power supply, though they all have their own private electricity supplies. The power supply refers to the electricity generated for an electric appliance such as washing machine and refrigerator. We have allocated funds for counties in the Kashgar region. The project is underway. It is planned to ensure power supply is made available by the end of June 2020, enabling all villages in Xinjiang to have access to this utility. At the same time, we have also accelerated the coal-to-electricity project in southern Xinjiang. Although the coal resources in Xinjiang are very rich, there is an imbalance in distribution between north and south. We have decided to implement the coal-to-electricity project in Kashgar Prefecture, Hotan Prefecture and Kizilsu Kirghiz Autonomous Prefecture in southern Xinjiang this year. The supporting projects related to the power grid are underway, and the coal-to-electricity projects involving more than 330,000 households have been put out to tender, and we will strive to complete them by the end of the year. We will make breakthroughs in improving the power supply in southern Xinjiang, achieving cleaner production, and improving people's lives. 

The second direction is to actively focus on targeted measures. The third direction is to focus on efficient project funding. The fourth is to put into place a strong policy guarantee mechanism. The fifth is to improve overall planning, the sixth to improve our abilities in solving problems, the seventh to work out measures to prevent those who have escaped poverty from falling back into that condition again, the eighth to realize the goal of poverty alleviation through knowledge development, while the ninth is to solidify the foundations for all our work.

We have been counting down the days to achieving the final goal of eradicating poverty. Today, there are 520 days to go. In these 520 days, we must work hard to lift people out of poverty, and also make sure they never fall back into being poor again. There are 22 deep poverty-stricken counties. We must help them all get out of poverty. And in the meantime, we must consolidate the achievements already made in helping poverty-stricken counties to improve their conditions. Also, we must do a good job in those counties that have got rid of poverty to ensure they can maintain this state.

We have already taken concrete measures to prevent any return to poverty. The first is to improve related database by establishing electronic archives for every poor household. Through data informatization, it means we can formulate targeted plans to promote poverty alleviation in the future.

The second is to strengthen the mechanism for determining whether people have been lifted out of poverty. For those poor counties that have already got rid of poverty, we never slacken our efforts. We continue to support them and provide them with a series of favorable policies. In the second half of the year, we will prepare to allocate funds to address weak links so as to consolidate the achievements made in poverty alleviation. In order to prevent any slackening in progress, it is more important to mobilize ordinary people, strengthen the training of officials and promote skills training of poor households. As Mr. Shohrat Zakir and Mr. Alken Tuniaz introduced just now, we will strengthen the occupational training of all ethnic groups to stimulate endogenous motivation with the help of the vocational education and training centers.

After years of practice, we are confident in the effectiveness of our poverty relief efforts because we have found the right path. In particular, major breakthroughs have been made in poverty reduction through employment and industrial development. Hotan is the least developed area among the four prefectures in southern Xinjiang. Now, Hotan has launched a large-scale livestock and poultry breeding industry, having introduced over 20 million rabbits from Sichuan province and over 100,000 donkeys through cooperation with Dong’e Ejiao Co Ltd in Shandong province. Xinjiang actively promotes forestry and fruit farming. The red dates and walnuts grown in Xinjiang top the nation in quality. All of these efforts have contributed to poverty reduction. And we are confident in its success.

We believe that, after a prolonged period of hard work lasting 520 days, by the end of 2020, Xinjiang is bound to shake off poverty and build a moderately prosperous society in all respects in tandem with the rest of the country. We welcome you to visit the villages in Xinjiang, either those who have alleviated poverty or those that have not, and check our progress. We also welcome you to visit Xinjiang again in the first half of 2021 when we have won the battle against poverty. I will conclude here. Thank you.

Hu Kaihong:

Lastly, allow me to give the floor to Mr. Shohrat Zakir.

Shohrat Zakir:

Thank you very much. Thank you for your attention for the past two hours. Some of you have raised very good questions that are of wide interest. We're glad to answer them. I want to take this opportunity to thank you for your longstanding interest and support for Xinjiang. I also want to thank the State Council Information Office for giving us this opportunity to introduce Xinjiang to the rest of the country and the rest of the world. Starting from scratch, Xinjiang has changed greatly in the past 70 years. My colleagues and I have experienced Xinjiang's transformation from poverty to prosperity, and from underdevelopment to modernization. And we're proud to live in this era. Under the leadership of the CPC Central Committee with Comrade Xi Jinping at its core as well as under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we believe Xinjiang will become better with each passing day. We welcome you to Xinjiang and hopefully, through your reports, more people will come and visit. Xinjiang is a beautiful place and we deeply love and proud of it. As we celebrate the 70th anniversary of the founding of the People's Republic of China, we hope that Xinjiang will become better and contribute more to the country’s achievements 30 years later when we celebrate the PRC's centennial. Thank you.

Hu Kaihong:

This is the end of today's press conference. Thank you, Mr. Shohrat Zakir, Mr. Alken Tuniaz and Mr. Zhang Chunlin. Thank you for coming.

.

Read in Chinese

Speakers:

Yang Guang, spokesperson of the Hong Kong and Macao Affairs Office of the State Council

Xu Luying, spokesperson of the Hong Kong and Macao Affairs Office of the State Council

Chairperson:

Xi Yanchun, spokesperson of the State Council Information Office

Date:

July 29, 2019

Xi Yanchun:

Ladies and gentlemen, good afternoon. Welcome to attend this press conference. Recently, the public have paid great attention to the situation in Hong Kong. Today, we are delighted to invite the spokespersons of the Hong Kong and Macao Affairs Office of the State Council --Mr. Yang Guang and Ms. Xu Luying -- to introduce its position and views on the current situation of Hong Kong. They will also answer some of your questions.

Now, I'll give the floor to Mr. Yang. 

Yang Guang:

Friends from the media, good afternoon. It was raining heavily when I came to attend the conference. Thank you for coming out in such bad weather. Today's press conference is held by the Hong Kong and Macao Affairs Office of the State Council. This is the first time for Ms. Xu Luying and myself to meet you as spokespersons for the office. Please allow me to extend our warm welcome and great thanks to you for your attendance here. 

Recently, a string of protests and violent incidents have occurred in Hong Kong after the government of Hong Kong Special Administrative Region (HKSAR) tried to discuss the amendments to the Fugitive Offenders Ordinance and Mutual Legal Assistance in Criminal Matters Ordinance. The situation has drawn widespread attention both domestically and internationally. The central government is also paying close attention to the developments.

The HKSAR government decided to amend the two ordinances because of a simple criminal case. Last February, a Hong Kong resident, Chan Tong-kai , was suspected of killing his pregnant girlfriend in Taiwan, and fleeing back to Hong Kong. Since the HKSAR government has no jurisdiction over the case, it proposed to amend the two aforementioned ordinances. This would allow the local government to cooperate with the mainland, Macao and Taiwan on extraditing criminal suspects and fugitives in individual cases through a special arrangement. This was because it has not signed agreement with the latter ones on extraditing fugitives and seeking legal assistance in criminal cases. This would be helpful in handling the aforementioned case, and would close an existing legal loophole to jointly combat crime, and uphold law and justice.

Unfortunately, some Hong Kong residents have insufficient knowledge about the mainland's situation and its legal and judicial systems. They began to doubt the HKSAR government's decision on amending the ordinances. What is worse, some ill-intentioned individuals and media outlets took this opportunity to spread exaggerated or false views, thus causing panic among the public, and obstructing the discussion of the amendments in the HKSAR Legislative Council. In this context, since June, several rather large protests over the amendments have occurred. On June 15, in order to listen to public opinion more widely, and to restore normal social order, the HKSAR government postponed work on the amendments and hence all related legislative activities came to a stop. The central government fully supports, respects and understands the HKSAR government's decision.

Yang Guang:

As to peaceful protests against the proposed extradition law amendments, the HKSAR police have granted approval and provided protection in accordance with the law. However, the intentional violent activities by some radical protesters since June 12 have gone far beyond the proper scope of peaceful demonstrations. They surrounded the Legislative Council building, blocked roads and halted traffic. They hurled bricks, metal rods and petrol bombs at the police and even charged the police cordon lines. They blockaded the Hong Kong Police Headquarters twice, and disturbed the operations of Hong Kong's Inland Revenue Department and Immigration Department, further worsening the situation.

Yang Guang:

On July 1, the day on which the 22nd anniversary of Hong Kong's return to the motherland was being celebrated, radical protesters stormed the Legislative Council building, vandalized facilities, smeared the emblem of the HKSAR, and tore up copies of the Basic Law of the HKSAR. In a series of violent activities, they fanned hatred towards the police, assaulted and attacked them with corrosive liquids or toxic powders, and even bit off part of a police officer's finger. Such violent acts are outrageous.

Yang Guang:

On July 21, some radical protesters blocked the building of the Liaison Office of the Central Government in Hong Kong, defaced the national emblem,and painted insulting words on the wall. Their behaviors are extremely serious in nature and have caused very bad influence. In addition, the HKSAR police have raided a homemade-explosives manufacturing lab in a factory building, seizing a large cache of TATP explosives and other materials intended for use in the violent demonstrations. So far, violence has not ceased. The day before yesterday, some radical protesters staged illegal rallies in Yuen Long District and committed a series of violent acts, injuring over 20 people. Yesterday, some radical protesters rallied illegally on Hong Kong Island and charged the police cordon lines there.

Yang Guang:

The marches and demonstrations and violent clashes have lasted more than one month in Hong Kong, impinging on the rule of law, social order, economic and social activities, people's life and international image of Hong Kong. This has saddened all the people who love and care about Hong Kong. I have three points to make.

Yang Guang:

First, it is hoped that people from all walks of life in Hong Kong will clearly oppose and resist violence. What has happened recently, especially the acts of violence committed by a small number of radicals, has undermined Hong Kong's prosperity and stability, challenged the rule of law and social order, threatened the personal and property safety of the residents of Hong Kong, and hit the bottom line of the principle "one country, two systems," and will not be tolerated. Violence will not be tolerated in any civilized society and society of rule-of-law. It is hoped that the general public of Hong Kong will be aware of the seriousness of the current situation and jointly condemn the evil and criminal acts committed by the radicals so as to prevent them from sabotaging Hong Kong.

Yang Guang:

Second, it is hoped that Hong Kong people will resolutely uphold the rule of law. This is the core value that Hong Kong people take pride in, a foundation for a favorable business environment, and an important cornerstone for prosperity and stability. We will not do nothing about the outrageous behaviors by a small group of people. Once the rule of law is undermined, Hong Kong cannot retain its prosperity and stability. The central government firmly supports Chief Executive of Hong Kong Special Administrative Region (HKSAR) Carrie Lam in leading the HKSAR government to rule according to the law, the Hong Kong police in enforcing laws rigorously, the HKSAR government and the judiciary body in meting out punishment to violent criminals according to the law, and patriots and people who love Hong Kong in safeguarding rule of law in Hong Kong. Aware of the huge pressure that the Hong Kong police and their families are suffering, we give our solute to the fearless and excellent Hong Kong police who have been sticking to their posts, fulfilled their duties, and endured humiliation.

Yang Guang:

Third, it is hoped that Hong Kong will get out of the political contentions as soon as possible, and concentrate on developing its economy and improving people's livelihood. Development is crucial for Hong Kong, and it holds the key to resolving various local issues. Although Hong Kong, endowed with favorable conditions and enjoying unique advantages, has laid a pretty good foundation for its development, it can't stand turmoil and riots, which would leave dent on its prosperity and stability. If the chaos continues, the whole society of Hong Kong will bear its brunt. The HKSAR government and the whole society should explore ways and adopt efficient measures to promote local economic growth and improve people's livelihood, especially help young people to cope with difficulties in issues such as housing, education, employment and starting businesses, so as to alleviate their grievances. The central government is willing to join hands with the HKSAR government and people from all walks of life in Hong Kong to create favorable conditions for the development of young people.

Yang Guang:

Since Hong Kong's return to the motherland, the implementation of the principle of "one country, two systems" there has achieved widely recognized success. The principles of "one country, two systems," "Hong Kong people administering Hong Kong" and a high degree of autonomy in the HKSAR have been fully implemented. Hong Kong has maintained its prosperity and stability, and is generally recognized as one of the world's freest economies. Its outstanding business environment and global competitiveness are widely recognized by the international community. The people of Hong Kong enjoy unprecedented democratic rights and a broad range of freedoms rarely seen across the world. Hong Kong also continues to rank high in the World Justice Project Rule of Law Index.

Yang Guang:

Practice fully demonstrates the principle of "one country, two system" provides the best institutional arrangement to ensure Hong Kong's long-term prosperity and stability. The central government will unswervingly stick to and implement the policy of "one country, two systems," ensure its practice, and will not deviate from its expected direction.

Yang Guang:

It's believed that, with the strong support of the central government and all the people of the Chinese mainland, under the leadership of the HKSAR government led by Chief Executive Carrie Lam, our compatriots in Hong Kong will be bound to do a good job in administering, building and developing Hong Kong by bravely coping with all kinds of difficulties and challenges. The policy of "one country, two systems" will be bound to show its continued vitality and tenacity.

Yang Guang:

Next, my colleague and I will answer your questions.

Xi Yanchun:

Thank you, Mr. Yang, for your opening remarks. Now, the floor is open for questions. As we have many foreign media in attendance today, simultaneous interpreting is available throughout the press conference. However, consecutive interpreting will be provided when a question is raised so that everyone understands it. Please identify the news organization you represent before asking questions.

CCTV:

Presently, some individuals in the Hong Kong society advocate using violence and "achieving justice by violating the law." Could you please give us your views on this stance? Thank you.

Yang Guang:

Thank you for your question. Laws must be obeyed and offenders punished, which I think is the fundamental requirement for any society ruled of law. Moreover, the rule of law is the core value of which Hong Kong citizens have long been proud. What we want to say is that, no claim can be expressed illegally no matter how lofty its claimed goal might seem, let alone back by a resort to violence. Violence is violence, and unlawful practice is unlawful practice, whose nature won't change because of any disguised claim or advocacy. We have noted that, recently, all sectors in the Hong Kong society have repeatedly launched large rallies, calling for protecting Hong Kong, upholding the rule of law, and opposing violence. They represent the real mainstream public opinion in the Hong Kong community. The central government firmly supports the Hong Kong police, relevant departments and judicial institutions in punishing violent and illegal acts according to the law, ascertaining criminal responsibility of violent offenders, restoring normal social order as soon as possible, and ensuring public personal and property safety. Thank you.

Lianhe Zaobao:

Many Hong Kong people are worrying about the principle of "one country, two systems" existing in name only, or focusing more on "one country" rather than "two systems." How can the central government reassure them? Thank you.

Yang Guang:

Thank you. I think the core of your question is how to understand the principle of "one country, two systems." This is a complete concept and an integrated set of guidelines and policies requiring comprehensive and precise understanding. "One country" is like the roots of a tree. For a tree to grow tall and luxuriant, its roots must run deep and strong. Implementing the principle in Hong Kong and Macao, we should never hit the three bottom lines. The bottom lines are: Any attempt to endanger national sovereignty and security, challenge the power of the central government and the authority of the Basic Law of the HKSAR or use Hong Kong to carry out infiltration and sabotage activities against the mainland is absolutely impermissible. Only based on "one country" can we talk about "two systems." The central government will unswervingly implement the principle and make sure that it is fully applied in Hong Kong without being bent or distorted. Since Hong Kong's return to China, whenever the central government exercises its power in accordance with the law, questioning always emerges as to whether it would undermine the high degree of autonomy in the HKSAR. In my opinion, such comments are due to some people either not being able to understand the principle of "one country, two systems" comprehensively and precisely, or through deliberate misinterpretation.

South China Morning Post:

Since controversy arose concerning the HKSAR government's amendments to the Fugitive Offenders Ordinance and Mutual Legal Assistance in Criminal Matters Ordinance, Hong Kong has seen a protracted period of massive demonstrations. According to a University of Hong Kong opinion poll, the public approval rating for Carrie Lam has hit a new low. How does the central government judge her performance in the past one or two months, including her handling of the Fugitive Offenders Ordinance amendment bill? Is she still fit to run Hong Kong? Will the HKSAR's high-ranking officials including Carrie Lam be held accountable? Thank you.

Xu Luying:

Thanks for your question. Since taking office in 2017, Chief Executive Carrie Lam has led the HKSAR government to actively govern Hong Kong. She has done a great deal of work developing the economy, improving people's well-being and integrating Hong Kong into the national development course. This is obvious to all. All along, the central government has fully recognized the work of Carrie Lam and the HKSAR government. The amendment bill aims to plug loopholes in the HKSAR's existing legal framework, jointly crack down on crimes and uphold justice. It has the support of the central government. After big differences and demonstrations arose in regard to the amendment bill, the HKSAR government decided to suspend work on it to restore public peace and order as soon as possible. The central government has expressed its support, understanding and respect for this. We notice that the HKSAR government has summed up and reflected on its shortcomings in handling the amendment bill. At the July 1 reception to mark the 22nd anniversary of Hong Kong's return to the motherland, Chief Executive Carrie Lam said that the HKSAR government would change its style of governance to become more open and inclusive to public opinions. We also notice that quite a few Hong Kong citizens have been quietly supporting the chief executive and the HKSAR. The central government will continue to firmly support Chief Executive Carrie Lam and the HKSAR government in governing Hong Kong in accordance with the law and uniting and leading all sectors of Hong Kong to jointly maintain prosperity and stability. Thank you.

CNBC:

First question is (that) does the situation in Hong Kong affect the financial industry's daily operations or the future development. I'm interested in what's the central government' view on this. Second is (will) Carrie Lam is going to resign as many have reported and third is what is the central government doing to ensure public security and what kind of cooperation is the government doing with the local operations, whether it's individuals or organizations and whether the debate around electoral reform will be reopened as a way to relieve tensions. Thank you.

Xu Luying:

Thank you for your question. A favorable business environment is crucial to Hong Kong. So far, we have seen that Hong Kong maintains a good business environment, even though the recent radical violence has impinged on the social order and international image of Hong Kong. We have noticed that the Hong Kong Retail Management Association recently stated that most of its members have seen a significant sales decline over the past month. The data released by the City University of Hong Kong also revealed the consumer confidence index in Hong Kong had fallen to its lowest level in five years. The tourism industry has also reported the number of tourist groups visiting Southeast Asia has been declining recently. It is expected to drop by more than 70% at most. I believe this is only part of the situation but it is a warning and deserves deep thought by the Hong Kong community.

As for the impact on the financial sector you mentioned, it is not obvious from the data. However, I think that for an export-oriented small-scale economy like Hong Kong, in such a complex and volatile international economic environment, if the business environment and confidence level decline, the external risks faced by the financial sector will naturally increase. Therefore, we also maintain that the top priority is to punish violent criminals according to law, restore social order as soon as possible, and maintain a favorable business environment in Hong Kong. This is of paramount importance.

As for your second question, the reporter with the South China Morning Post has asked about that just now. so, I will not repeat my answer.

Regarding the third question, whether the central government will change the election mode, the electoral method in Hong Kong is stipulated by the Basic Law of the HKSAR and the relevant supporting laws. We must abide by the law, now and in the future, in order to continue developing a democratic system suitable for the actual situation of Hong Kong by stages. The central government's standpoint on this issue will not change. Thank you.

TVB:

I want to ask two questions. First, I have heard opinions that the team of Chief Executive Carrie Lam Cheng Yuet-ngor has lost the prestige of governance. If her administration is not dismissed and is held accountable, will you be worried that fingers will be pointed to the central government in the final analysis? Will the central government support the establishment of an independent committee to thoroughly investigate responsibility for the entire extradition bill incident? Second, there are claims that some white-clad thugs attacked citizens in the MTR station of Yuen Long on July 21, which was an indiscriminate terror attack. The public has questioned police abilities to fight against mobs and gangs, which may also indicate that some policemen are working with them. Also, a Hong Kong police officers association has written a letter expressing disapproval of the statement made by Chief Secretary for Administration. How to deal with the situation where the citizens are being attacked? Thank you.

Yang Guang:

Thank you. Your first question is about a commission of inquiry. In our point of view, the most dangerous part in the current situation in Hong Kong is that violent criminal acts have not been effectively stopped. The most important task of the Hong Kong administration at present is to resolutely punish violent crimes in accordance with the law, restore social stability as soon as possible, and safeguard Hong Kong's rule of law. I believe that, with the efforts of the Chief Executive Carrie Lam and the HKSAR government, under the strict enforcement of the Hong Kong Police Force and the concerted efforts of the Hong Kong people who love the city and the motherland, the community will be able to stop these violent crimes as soon as possible and help the Hong Kong society to return to normal.

Your second question is about the violent incident in Yuen Long. I have nothing to add on this question, because the chief of the Hong Kong Police Force and the head of the Liaison Office of the Central People's Government in the HKSAR have already made clear responses to this question. These rumors are unfounded slanders. We should pay special attention to the tremendous efforts made by the Hong Kong Police Force in maintaining public security and social order for more than a month. They have undergone many painful sacrifices. They personally have been under tremendous pressure, and their families are also under great pressure, suffering from various kinds of internet bullying. Despite this, the Hong Kong police have still shown restraint and their professionalism. We believe that with the efforts of the HKSAR government and the Hong Kong police, the various difficulties and challenges at present will certainly be resolved. Thank you.

Macao Daily News:

This year, the Macao Special Administrative Region (MSAR) will elect its fifth Chief Executive. Ho Iat Seng obtained a total of 378 nominations, which makes him the only qualified candidate. Will the central government support him to assume office as the next Chief Executive in MSAR? Thank you.

Xu Luying:

The MSAR will elect its fifth Chief Executive in August. In accordance with MSAR Basic Law and other relevant laws, the Chief Executive will be elected through a set of legal procedures and appointed by the central government. The standards formulated by the central government for nomination as the Chief Executive are consistent. They are required to be patriotic in regard to the motherland, trustworthy in the eyes of the central government, capable of administering regional affairs and be recognized by the entire local society. We believe the election of a new Chief Executive who meets these criteria will proceed smoothly. That's all I wish to say about the election of the Chief Executive in MSAR.

Now, I would like to add a few words to my previous answer to the question about the HKSAR, which was raised by a Hong Kong journalist, because both questions are concerned about elections. The HKSAR's election is based on its Basic Law, the resolutions made by the Standing Committee of the National People's Congress (NPC) and relevant local laws. Thank you.

Xinhua News Agency:

What do you think of the role that some Western countries played in the recent turmoil over the proposed legal amendments to the Fugitive Offenders Ordinance in Hong Kong? Thank you.

Yang Guang:

Thank you for your question. Regarding the series of demonstrations and violent incidents that happened in Hong Kong, some irresponsible Western individuals have made irresponsible remarks and played a disgraceful role. Some remarks display a perverse logic that violent offenders deserve sympathy, understanding and even forgiveness, while police fulfilling their duties to protect public order and security, and safeguard the rule of law in Hong Kong, should face criticism, outright condemnation and be held to account. Such logic is absurd and ludicrous.

As I said just now, the nature of violence and unlawful acts will never change because of any hypocritical claim. This is a bottom line of a society based on the rule of law, and must not be challenged.

Hong Kong is part of China, and its affairs are of domestic concern alone. The Chinese government absolutely does not allow any foreign forces to interfere in Hong Kong's affairs. Chinese State Councilor Wang Yi and spokespersons of the Ministry of Foreign Affairs have reiterated our unwavering stance many times. Some Western politicians time and again have made irresponsible remarks and even backed some certain people. Their ulterior motives are to disrupt Hong Kong, change Hong Kong into a troublesome sore for China and in turn constrain Chinese development. These attempts will get them nowhere. Thank you.

CNN:

For the situation in Hong Kong to have come this far, there must been serious concern about possible intervention of the PLA. Just last week, a journalist asked the spokesperson of the Ministry of National Defense about such intervention, but the spokesperson referred him to the Law of the People's Republic of China on the Garrisoning of the HKSAR. Could you just tell us directly on what premises and in what ways the PLA Hong Kong Garrison would be deployed and what possible international impact that would have. A follow-up question: what has happened in Hong Kong cannot be merely explained by the collusion between radical elements and external forces, and there are people who wonder if there has been a miscalculation by the central government on the deep-rooted structural social and political problems in Hong Kong. What is your response to this? Will the central government adjust its policies in this regard?

Yang Guang:

Thank you. As for your first question, I refer you to the Basic Law of the HKSAR, so I don't need to add anything. Your second question has been mentioned in my previous remarks and my answers to other questions. The priority now is to punish violent acts and safeguard the rule of law. Thank you.

Xi Yanchun:

The last question.

Hong Kong Ta Kung Wen Wei Media:

Some people believe there is a widespread mood of complaint in Hong Kong society. Deep-seated issues like land, housing and upward social mobility of the young generation have not been addressed. What will the central government do to help Hong Kong solve these problems? Thanks.

Xu Luying:

Thanks for your question. Deep-seated issues, including land, housing and upward social mobility of the young generation, do exist in Hong Kong. The reasons behind these issues are profound and multi-faceted, and are closely related to complex historical elements, the social roots of the population as well as the international background. These problems will not be solved in one day. Instead, we need to tackle them through comprehensive and multiple measures. The central government has been paying close attention to the deep-seated problems revealed in Hong Kong, and the government of the HKSAR has been working hard in this regard. Just as was emphasized in the statement, development holds the key to solving various problems facing Hong Kong, and its deep-seated problems will have to be resolved in the process of development. The central government will continue to support Hong Kong to develop its economy, improve the public livelihood, integrate the city with the overall development plan of the motherland. The relevant departments in the central government will continue to introduce a series of favorable policies and measures for the residents of Hong Kong to pursue their careers on the mainland. In particular, we will consider expanding opportunities and giving new impetus to Hong Kong in the development of the Guangdong-Hong Kong-Macao Greater Bay Area, which will provide Hong Kong residents, especially the young, with more opportunities. However, development cannot be realized without a harmonious and stable society. Therefore, we hope all sectors in Hong Kong can work together to walk away from the political turmoil as soon as possible, and seize major opportunities to achieve better development. Thanks.

Xi Yanchun:

It is the first time for the two spokespersons to speak here. Do both of you want to add any further comments?

Yang Guang:

Thanks for your attendance. Time is limited today and many media outlets have not had the opportunity to ask a question. However, I believe we will have more opportunities to continue our conversation in the future. You can also submit your questions to our colleagues and we will communicate with you in due time.

Xi Yanchun:

Thanks to everyone. This press conference is concluded.

.

Read in Chinese

Speakers:

Senior Colonel Wu Qian, spokesperson of the Ministry of National Defense;

Major General Cai Zhijun, deputy director general of the Operations Bureau of the Joint Staff Department under the Central Military Commission (CMC);

Colonel Pan Qinghua from the Publicity Bureau of the Political Work Department under the CMC;

Senior Colonel Wang Taiguo, deputy director general of the Finance Bureau of the Logistic Support Department under the CMC;

Senior Captain Wang Wei, deputy director general of the Coordination and Supervision Bureau of the Office for Reform and Organizational Structure under the CMC.

Chairperson:

Hu Kaihong, spokesperson of the SCIO

Date:

July 24, 2019

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference. Today, the State Council Information Office issued a white paper titled "China's National Defense in the New Era." Here, we will introduce and explain the document's major content. 

Present at the conference are: Senior Colonel Wu Qian, spokesperson of the Ministry of National Defense; Major General Cai Zhijun, deputy director general of the Operations Bureau of the Joint Staff Department under the Central Military Commission (CMC); Colonel Pan Qinghua from the Publicity Bureau of the CMC Political Work Department; Senior Colonel Wang Taiguo, deputy director general of the Finance Bureau under the CMC Logistic Support Department; Senior Captain Wang Wei, deputy director general of the Coordination and Supervision Bureau of the CMC Office for Reform and Organizational Structure. I'm Hu Kaihong, spokesperson of the SCIO and host of this press conference.

First, I'd like to make a brief introduction of the white paper.

The white paper entitled "China's National Defense in the New Era" is China's first comprehensive document on national defense since the 18th National Congress of the Communist Party of China in 2012. It focuses on international community's concerns about the development of the Chinese military, and systematically introduces the characteristics, principles, as well as fundamental connotation of the defensive nature of China's national defense strategy. The white paper also clarifies the mission of the armed forces in regard to the "four strategic supports," which are to provide strategic support for consolidating the leadership of the CPC and the socialist system, safeguarding national sovereignty, unity and territorial integrity; protecting China's overseas interests; and promoting world peace and development. It also clearly demonstrates the distinct features of "never seeking hegemony, expansion or spheres of influence" of China's national defense, providing details of the reasonable and appropriate defense expenditure, as well as the global significance of China's armed forces, and its contribution to building a Community with a Shared Future for all Humanity. The white paper comprises around 27,000 Chinese characters, and is divided into four parts, including preface, main body, concluding remarks and appendices.

The white paper points out that, the world today is undergoing profound changes unimagined in the past century. As economic globalization, growth of the information society, and cultural diversity develop in an increasingly multi-polar world, peace, stable development and win-win cooperation form irreversible trends of the times. Nonetheless, there are prominent destabilizing factors and uncertainties in international security. The international strategic landscape is undergoing profound changes, though the Asia-Pacific Security situation remains generally stable, the risks and challenges facing China's national security should not be ignored. With increasingly fierce international military competition, the world is not yet a tranquil place.

The white paper also states that China adheres to a national defense policy that is defensive in nature. The fundamental goal of national defense in the new era is to resolutely safeguard China's sovereignty, security, and development interests. Never seeking hegemony, expansion or spheres of influence is the distinctive feature of China's national defense in the new era. Implementing the military strategic guideline for a new era is the strategic guidelines for China's national defense. Continuing to strengthen the military in the Chinese way is the way forward for China's national defense in the new era. The global significance is in the service of building a community with a shared future for mankind. 

In the new era, in meeting the strategic demands of national security and development, China's armed forces are firmly implementing the missions and tasks entrusted by the CPC and the Chinese people as a whole. They endeavor to provide strategic support for consolidating the leadership of the CPC and the socialist system, safeguarding national sovereignty, unity and territorial integrity, protecting China's overseas interests, and promoting world peace and development.

The white paper points out that, in the new era, China is promoting defense policy and military modernization across the board and deepening reform in its national defense program and its armed forces in all respects. China is reforming the leadership and command system; optimizing the size, structure and composition; reforming military policies and institutions, reshuffling PLA and PAP troops, and promoting defense and military development in all respects, by which China has already taken historic steps toward strengthening and revitalizing the armed forces.

The white paper also notes that China's armed forces have responded faithfully to the call for a community with a shared future for mankind, resolutely upholding the purposes and principles of the U.N. Charter and building a new-model security partnership featuring equality, mutual trust and win-win cooperation. China's armed forces have also spared no efforts to promote regional security cooperation, properly cope with disputes over territory and maritime demarcation, and actively provide international public security goods. These show that China's armed forces are striving for a better world of lasting peace and common security.

Guided by Xi Jinping's thinking on strengthening the military, China's national defense in the new era will stride forward along its own path to build a stronger military and endeavor to achieve the great goal of developing a world-class force in an all-round way. China's armed forces have the determination, confidence and capability to meet all threats and challenges. They stand ready to provide strong strategic support for the realization of the Chinese Dream of national rejuvenation, and to make new and greater contributions to the building of a community with a shared future for mankind.

The white paper has been published in Chinese, English, French, Russian, German, Spanish, Arabic and Japanese by the People's Publishing House and Foreign Languages Press. It will be issued across the country by the Xinhua Bookstore.

That's all for the general introduction. Next, I give the floor to Senior Colonel Wu Qian, spokesperson of the Ministry of National Defense.

Wu Qian:

Ladies and gentlemen, good morning. Today, the white paper "China's National Defense in the New Era" makes its debut to the world. It is the 10th white paper on national defense that the Chinese government has issued since 1998 and the first comprehensive one since the 18th National Congress of the Communist Party of China in 2012. The white paper "China's National Defense in the New Era" is issued to expound on China's defensive national defense policy and explain the practice, purposes and significance of China's efforts to build a fortified national defense and a strong military, with a view to helping the international community better understand China's national defense, and to promote multinational cooperation and mutual trust.

The white paper consists of around 27,000 Chinese characters, including preface, main body, concluding remarks and appendices. The main body of the white paper is divided into six sections: the international security situation; China's defensive national policy in the new era; fulfilling the missions and tasks of China's armed forces in the new era; reform in China's national defense and armed forces; reasonable and appropriate defense expenditure; and actively contributing to building a community with a shared future for mankind. A total of ten tables are included in the appendices to introduce the functional organs of the Central Military Commission (CMC), the structure of China's defense expenditure, all major joint exercises and training by the PLA and PAP with foreign counterparts since 2012, and UN Peacekeeping Operations that the PLA have participated in, just to name a few.

The main body of the white paper "China's National Defense in the New Era" consists of the following six aspects:

1. An objective analysis of the international and domestic security situation. The white paper notes that the world today is undergoing profound changes unseen in a century, and there are prominent destabilizing factors and uncertainties in international security. International strategic competition is on the rise, global and regional security issues are on the increase, and the global military competition is intensifying. The world is not yet at a tranquil place. Nevertheless, the pursuit of peace, stability and development has become a universal aspiration of the international community with forces for peace predominating over elements of war. Peace, development and win-win cooperation remain the irreversible trends of the times. The white paper also points out that the national security situation of China remains generally stable, meanwhile China also faces diverse and complex security threats and challenges, especially when considering the acute fight against separatists.

2. As a systematic introduction to China's defensive national defense policy in the new era, the white paper stresses that resolutely safeguarding China's sovereignty, security and development interests is the fundamental goal of China's national defense in the new era. Never seeking hegemony, expansion or spheres of influence is the distinctive feature of China's national defense in the new era. Meanwhile, implementing the military strategic guideline is the main objective for China's national defense in the new era. Continuing to strengthen the military in a Chinese way is the path forward for China's national defense in the new era. China's national defense is of global significance and serves to build a community with a shared future for mankind in a new era.

3. A comprehensive picture of fulfilling the mission and tasks of China's armed forces in the new era. The white paper clarifies the four strategic priorities of the mission of China's armed forces in the new era, which is to provide strategic support for consolidating the leadership of the CPC and its socialist system; to safeguard national sovereignty, unity and territorial integrity; to protect China's overseas interests; and to promote world peace and development. The implementation of China's armed forces is demonstrated through the following seven aspects including safeguarding national territorial sovereignty and maritime rights and interests, maintaining combat readiness, carrying out military training in real combat conditions, safeguarding interests in major security fields, countering terrorism and maintaining stability, protecting China's overseas interests, and participating in disaster rescue and relief.

4. A comprehensive presentation about the historic achievements of reform in national defense and the armed forces. The white paper systematically presents China's armed forces' reform of its leadership and command system, its optimized size, structure and force composition, and the reform of military policies and institutions. It also introduces the reshuffled PLA and PAP troops, as well as the progress made in theoretical and political buildup, military theory, weaponry and equipment, logistics system, showing a brand-new model of China's armed forces after the reform.

5. A multi-dimensional briefing of China's defense expenditure. The white paper introduces the developing trend of China's defense expenditure since reform and opening-up, and thoroughly explains the scale, structure, and usage of China's defense expenditure since 2012, demonstrating its transparency. Besides, the white paper also includes a comparison of defense expenditure in the international context, justifying the reasonable and appropriate nature of China's defense expenditure.

6. An in-depth look into China's armed forces' efforts and their contribution to global peace and building a community with a shared future for mankind. The white paper says that building a community with a shared future for mankind conforms to the trends of the times for peaceful development, and reflects the common aspirations of all peoples throughout the world. China's armed forces' endeavor in this regard is manifested through their contribution in the following five aspects, including resolutely upholding the purposes and principles of the UN Charter; building a new-model of equal security partnership; mutual trust and win-win cooperation; building a regional security cooperation architecture; properly coping with disputes over territory and maritime demarcation; and actively providing international public security goods.

Compared with the previous versions of white papers in this regard, today's white paper features the following innovations:

1. Establishing China's defensive national defense policy in the new era for the first time. The white paper notes that the socialist system of China, the strategic decision to follow the path of peaceful development, peace-led foreign policy and the best of cultural traditions – holding peace and harmony as fundamentals – determine that China will pursue a national defense policy that is defensive in nature. The white paper demonstrates the strategic, stable, and systematic nature of how this is implemented. 

2. Putting forward the missions of China's armed forces in the new era for the first time. In the new era, to meet the strategic demands of national security and development, China's armed forces firmly implement the missions and tasks entrusted by the CPC and the people. They endeavor to provide strategic support for consolidating the leadership of the CPC and the socialist system, safeguard national sovereignty, provide unity and territorial integrity, protect China's overseas interests, and promote world peace and development. By introducing the missions and practices of China's armed forces, the white paper justifies the defensive, rightful, and limited implementation of China's armed forces.

3. Pointing out "never seeking hegemony, expansion or spheres of influence" as the distinctive feature of China's national defense in the new era, the development of China's national defense aims to meet its rightful security needs and contribute to the growth of the world's peaceful forces. By policy-based declaration, the white paper shows China's determination of never seeking hegemony, posing threats, nor setting spheres of influence regardless of China's future development.

4. Putting forward for the first time the building of a community with a shared future for mankind to be the global significance of China's national defense in the new era. The white paper explains the internal connections between Chinese dream and the global dream, as well as between China's national defense, its military development and global peace and stability. The white paper reinforces that the development of China's armed forces will not only provide strategic support for the Chinese dream, but also provide powerful positive energy for global peace and stability.

5. Giving an all-round presentation of the historic achievements of deepening reform in national defense and armed forces. The white paper systematically presents the progress of deepening reform in national defense and armed forces in all respects, and in doing so demonstrates the implementation of Xi Jinping's thinking on strengthening the military, and the commitment to building a strong military with Chinese characteristics. By providing a schedule, structure and results of our reforms, the white paper presents a brand-new system and outlook for the Chinese armed forces, showing their effort in building a strong military with Chinese characteristics.

6. We make a comparison of defense expenditure in the international context for the first time. By conducting comparison in the fields of defense expenditure's share in GDP, its ratio of spending to government expenditure, and China's per capita defense expenditure, the white paper justifies the reasonable growth and relatively low spending of China's defense expenditure, compared to other major counties in this regard in 2017. Meanwhile the white paper also notes that there is still a wide gap between China's defense expenditure and the requirements for safeguarding national sovereignty, security and development interests; for fulfilling China's international responsibilities and obligations as a major country; and for China's development.

That's all about the introduction to the white paper. Now the floor is open for questions, and please identify your news agency before questions.

Hu Kaihong:

Now, the floor is open to questions. Please identify the media outlet you represent before asking questions.

CCTV:

The new white paper is entitled "China's National Defense in the New Era". This differs from the title of previous comprehensive national defense white papers. Why is the document so entitled? Besides that, we take note of the fact that the international situation is undergoing a profound transformation. How does the new white paper describe the international and domestic security situation? Thank you.

Wu Qian:

Please allow me to answer your questions. As stated in the report to the 19th CPC National Congress, socialism with Chinese characteristics has crossed the threshold into a new era, and we have reached a new starting point in strengthening national defense and the armed forces. 

In the new era, China's national defense forces fully implement Xi Jinping's thinking on strengthening the military, and his thinking on military strategy. We are committed to achieving the goal of building a strong military capability in the new era, implement the military strategic guideline for a new era, and continue to strengthen the military in the Chinese way. We have made historic achievements and promoted historic changes in the national defense and army building campaigns. Changes have occurred in the people's army's system, its structure, patterns and appearance. 

The first comprehensive white paper on national defense in the new era responds to the trend of the times. It provides a precise summary of the world situation, that of the country and the pertaining to the Chinese military. It provides a comprehensive introduction of the new policies on national defense and army building, as well as the new missions, tasks, strategic deployment and practices related to building a strong military force. It will be helpful for the world and the Chinese people to have a more comprehensive and objective understanding of our national defense and army building efforts in the new era. 

Regarding your second question, the international strategic landscape is undergoing a profound transformation. The process of disintegration and re-integration of various international powers is gaining momentum. Emerging markets and developing countries have acquired greater strength. With various powers growing or waning, the global power configuration has become more balanced. Seeking peace, stability and development has become a common pursuit of international society. The forces for peace far outweigh factors causing war. At the same time, however, hegemony, power politics and unilateralism are mounting, and regional conflicts and wars are ongoing, threatening the international security system and order.

The white paper contains four strategic conclusions on the current international and domestic security situation: First, the international strategic landscape is undergoing a profound transformation. Second, the security situation of the Asia-Pacific region generally remains stable. Third, the security risks and challenges facing China should not be overlooked. Fourth, international military competition is intensifying.

In the face of such a complex international and domestic situation, China firmly believes that peace, development, cooperation and prosperity for all are irreversible trends of the times. Any attempt to seek hegemony or expansion is doomed to fail. Security and prosperity should be enjoyed by all. 

We call for all countries to go beyond outdated concepts such as a clash of civilizations, Cold War and a zero-sum mentality, and uphold such principles as conducting dialogue and consultation, seeking common ground while setting aside differences, and making joint contribution and sharing benefits. We should make joint efforts to tackle global challenges, promote peace and development, build a community with a shared future for mankind, and build an open, inclusive, clean, and beautiful world that enjoys lasting peace, universal security and common prosperity. Thank you.

China Daily:

The new white paper on national defense stresses Xi Jinping's thinking on military strategy. Could you please tell us the background and significance of the formation of this important thinking? What are its theoretical characteristics and historical contributions?

Cai Zhijun:

Thank you for your questions. Military strategic thinking is the banner that guides an army, and it should keep up with the times. Since the 18th CPC National Congress, President Xi, in his dedicated leadership of national defense, the building of our armed forces, and commanding actual military campaigns, has taken a broad view of the profound changes in the world not seen for a long time to deal with various risks and challenges involved in ensuring national security and meet the requirements of comprehensively building Chinese military into a world-class force. He has put forward a series of new ideas, viewpoints, judgments and requirements to enhance military strategic guidance as required by the times. Against this background, Xi Jinping's thinking on military strategy has taken shape. Xi, as the core of Party leadership and as commander-in-chief of the armed forces, is the main architect of this important thinking, and plays a decisive role in this process.

Xi Jinping's thinking on military strategy has always adhered to the strategic concept of active defense. It has profoundly revealed the important relationship between war and peace, military affairs and politics, national security and military security in the new era. It has comprehensively and systematically answered a series of fundamental, overarching and directionally important questions related to military strategic guidance in the new era. The important thinking is an innovative development of the Marxist view of war and methodology in China's national defense and armed forces building in the new era. It is the application and development of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. It is an important part of Xi Jinping's thinking on strengthening the military. It is a scientific ideological and theoretical system.

Xi Jinping's thinking on military strategy has distinct scientific qualities. First and most important, in terms of theory, it inherits and develops the essence of the Party's military guidance theory, and is the latest achievement in adapting the Marxist view of war and its methodology to a Chinese context. Second, from an historical viewpoint, it seizes the right moment when socialism with Chinese characteristics has entered a new era, and China's national defense and armed forces building has followed suit. Third, from a strategic viewpoint, it grasps the laws of waging war and directing war, endowing the strategic concept of active defense with new connotations. Fourth, from a practical viewpoint, a great truth emerges from the great practice of strengthening and revitalizing the armed forces, so it has a unique strategic style and insight.

Xi Jinping's thinking on military strategy has established a new realm in the Marxist view of war and security. It enhances the strategic drive of realizing the Chinese Dream of great national rejuvenation. It breaks new grounds for implementing national security strategy. It broadens our vision of modernizing national defense and armed forces. The thinking is a fundamental rule and scientific guidance for using and building our military forces at present and in the future. At the military work conference of the Central Military Commission held in Beijing in January 2019, Xi Jinping's thinking on military strategy was established as the fundamental guiding ideology of China's military strategy in the new era. The decision is based on political, practical and strategic needs. It is also is also the common expectation of the whole army. Thank you.

CNN: 

Regarding South Korea's accusation against Russian and Chinese aircraft of "violating" its airspace, the Pentagon spokesman said the U.S. Defense Department was in close coordination with its Korean and Japanese allies about the event, and will continue to monitor activities as they make follow-up contacts with the Russian and Chinese military in diplomatic channels. I would like to know China's response to it.

And I have another related question. Mark Esper was sworn in as the new defense secretary in Washington yesterday. He has long pushed for the U.S. to take a hardline stance against China. Earlier this year, he stated the U.S. was engaged in strategic competition with China, which is both the foundation and the shaping of his views in this regard. Also, he thinks that Russia and China's aggressive development of formations, capabilities and weapons systems in recent years poses a long-term threat to American interests. Many people believe that the U.S. military is more likely to engage in a public standoff with the Chinese military during Esper's tenure. What is your comment on this? Do you have any concerns about the Sino-U.S. military relationship while Esper serves as defense secretary? Thank you.

Wu Qian:

For your first question. On July 23, the Chinese and Russian air forces organized the first joint air patrol in Northeast Asia. China's two H-6K bombers, along with two Russian Tu-95 bombers, patrolled a pre-planned route over the Sea of Japan and the East China Sea. During the patrol, the planes of China and Russia maintained their flights in line with international rules and did not enter territorial air space of any other country. 

This joint patrol was carried out with the aim of deepening the two countries' comprehensive strategic partnership of coordination for a new era, of further increasing understanding between the armed forces of the two countries, and of enhancing their capabilities to carry out joint actions, and strengthening global strategic stability. The exercise was performed in line with the planned annual military cooperation program between China and Russia and was not aimed against any third country. 

Furthermore, we also noticed that the Russian Ministry of Defense has issued a statement in this regard, and I suggest you read it. 

For your second question, Mark Esper has been confirmed as the U.S. Secretary of Defense and we would like to extend our congratulations to him. We hope that the military relations between China and U.S. could achieve healthy and stable development during his tenure. However, here I also would like to emphasize two points: first, China's sovereignty, security and developmental interests are inviolable. Second, the development of China's military power is entirely in line with the development of the forces for world peace. Thank you.

China Military:

We noticed that the White Paper introduced the measures and progress made in reforming the national defense and the armed forces. So, what are the reasons behind the progress and what kind of measures have been taken to push forward the reform? Last November, the Central Military Commission held the working group meeting to comprehensively launch reform for military policies and institutions, which was also mentioned in the White Paper. Would you please talk about the major characteristics and progress of the reform?

Wang Wei:

Thanks for your questions. I'll start answering your first question. President Xi Jinping was personally involved in leading and pushing forward the reform of national defense and armed forces, offering the fundamental guarantee for the reform. Since the 18th National Congress of the Communist Party of China, President Xi has been involved in the decision-making part of the reform, and included the national defense and military reform into the overall plan of comprehensively deepening reform. As the leader of the Leading Group for National Defense and Military Reform of the Central Military Commission, he worked to study major issues with regard to the reform and formulated the plan. He took part in a series of group meetings, presented the military flags to the newly adjusted and established units and delivered a series of major speeches. We overcame many difficulties and made a huge achievement in deepening the reform of national defense and armed forces. All of these are under the strong leadership of the Party, Central Military Commission and President Xi and guided by President Xi's thinking on strengthening the military.

The national defense and military reform is based on the systematic design of three major issues. First, reforming the leadership and command system and removing institutional barriers. Second, supporting reforms in force structure and composition and solving structural problems. Third, deepening reform of military policies and institutions and resolving policy-related problems. We owe our achievements to the leadership of the Party Central Committee, the Central Military Commission and the guidance of President Xi Jinping on the national defense and military reform, and to the concerted efforts of the Party, the military, and all the people in China. The PLA has dismantled the long-established systems of general departments, military area commands and the force composition with a dominating land force, and established a new pattern of the CMC exercising overall leadership, the TCs responsible for military operations and the services focusing on developing capabilities.

Your second question is about the reform of policies and institutions. The reform of military policies and institutions is a major part and solid guarantee for deepening the national defense and military reform. It involves all areas, all aspects, and all parts of the military practice, and is more systemic, comprehensive, and balanced. One of the characteristics of the military policies and institutions reform is to maintain a profound understanding of the implication of policy and system building, and strengthen planning at the top level and adopt a holistic approach in doing so. We should comprehensively advance the military policies and institutions reform, striding forward along the path to build a stronger military and fully transform the people's armed forces into world-class forces. We should launch our reform in the fields of command, construction, management and inspection. We should develop a socialist military institution with Chinese characteristics. We should focus on reform measures from four aspects: strengthening Party building in the military, improving policies and institutions for military force employment, reformulating policies and institutions and reforming the policies and institutions for military management. All of these measures have a clear, comprehensive and balanced guide for their reform, which is catered for national and military conditions and is suited for the new era, new mission and new system.

According to the plan of the policy and institutional reform, by 2020, reform of the main structures of all systems and areas will be completed, and the basic framework of the socialist military policy and institution with Chinese characteristics will be established. By 2022, we will further improve the coordinated policies and establish the system of socialist military policy and institution with Chinese characteristics. Since the CMC held its working group meeting on policy and institutional reform last year, all departments and units in the military have taken their responsibilities to mull over plans in different systems and areas, with steady progress in military policy and institutional reform. We also actively responded to the urgent demands of the military reform and carried out a series of reform measures with respect to Party building in the military, improving the wellbeing of service personnel, the joint operations commands and conducting supervision on military training. We have already put all 27 policies into practice in the first half of the year. Related information has been released by the media, which you can refer to.

All these policies played an important role in deepening reform, uniting the military and responding to the concerns of officers and soldiers, which were highly commended by the military.

CGTN:

We have noted that, in the white paper's view, protecting national interests abroad is one of the important strategic missions for the People's Liberation Army (PLA), meaning the army will be involved more frequently in overseas military actions. Therefore, my question to our spokespersons is whether the actions will disturb PLA's path leading to peaceful development? Thank you.

Wu Qian:

Please allow me to answer your question. My short response is they do not contradict each other at all. While going abroad, the PLA can, on one hand, better implement the missions required in the new era to protect China's overseas interests; and on the other hand, provide more public security goods to meet the general expectations of the international community. Be they peacekeeping missions, navigation escorts on the high seas or humanitarian aid, there are sufficient examples mentioned in the white paper. The socialist system of China, the strategic decision to follow the path of peaceful development, the independent foreign policy of peace, and the best of our cultural traditions – considering peace and harmony as fundamentals – determine that China will pursue a national defense policy defensive in nature. It will never seek hegemony, expansion and establishment of spheres of influence. The promise reflects the distinctive feature of China's national defense in the new era. In other words, what the PLA brings to the world while going abroad are neither threats nor challenges, but stability and opportunities for promoting peace. Thank you.

Phoenix Satellite TV:

As has been mentioned, this is the first comprehensive white paper issued since the 18th National Congress of the Communist Party of China (CPC). After a simple comparison with previous white papers, I find relatively large changes in the evaluation of the security situation, especially in the area of risks from the aspect of national security. It very clearly states that the situation regarding the "fight against separatists is becoming more acute". This was only briefly mentioned in the past and it was never explicitly stated from where the security threats came. This time it is different and the use of the term "more acute" is also different. So, can you please tell us what considerations went into making these changes? Thank you.

Wu Qian:

When the white paper talks about the fight against separatists being "more acute ", it is based on only one thing, and that is the fact. As you can see, the Democratic Progressive Party (DPP) stubbornly sticks to "Taiwan independence" since it came to power, refuses to recognize the 1992 Consensus, and promotes a gradual independence within the island. By seeking the help of foreign powers to intervene, they have gone further down the path of separatism. This is a fact that is obvious to all. The signal we want to convey through the white paper is very clear and straightforward: seeking "Taiwan independence" would go nowhere, and China will not allow the loss of a single inch of its sovereign territory. We want to do our utmost to strive for the prospect of peaceful reunification, and will never allow the secession of any part of its territory by anyone, any organization or any political party by any means at any time.

CRI:

As we know, President Xi Jinping has attached vital importance to raise political awareness in the military, which is also seen as a fundamental task for our armed forces. Could you give us an introduction on raising political awareness in the military after the CPC's 18th National Congress?

Pan Qinghua:

Thanks for your question. Political work is the lifeline of the PLA, as well as its most prominent characteristic and greatest strength. Since the Party's 18th National Congress, in order to achieve the Chinese Dream of national rejuvenation and the goal of developing world-class forces in an all-round way, we have made great efforts to reinforce and improve political work and catalyzed innovative development. China's armed forces unswervingly take Xi Jinping's thinking on strengthening the military as the guidance, firmly uphold Xi Jinping's position as the core of the CPC Central Committee and the whole Party, firmly uphold the authority of the Central Committee and its centralized and unified leadership, and follow the CMC Chairman responsibility system, in an effort to further strengthen the consciousness of the need to maintain political integrity, think in big-picture terms, follow the leadership core and keep in alignment.

It is reflected in the following three aspects: First, focusing on some prominent problems in the past, "The Decision on Issues Concerning the Army's Political Work Under New Circumstances" was adopted. Efforts to this end include promoting the ideals, values and principles of the Party, establishing new political standards for military personnel, and fostering a culture that values political work ethics. Second, a meeting on Party building of the Central Military Commission was held, so as to enhance its political and theoretical buildup, consolidate organizations, improve conduct, and enforce discipline in the new era. Third, to meet the objective of building a strong military for a new era, great efforts are being made to cultivate officers and soldiers of the new era with faith, ability, courage and integrity, and build troops with iron-like faith, conviction, discipline and commitment.

Global Times:

According to foreign media reports, Qian Weiping, the former vice head of the Equipment Development Department under the Central Military Commission (CMC) was arrested for alleged spying allegation. What is your comment on these reports?

Wu Qian:

I can tell you categorically that the spying allegation is false. As far as I know, Qian is now under investigation by the CMC's Discipline Inspection Commission for severe disciplinary violations and work-related crimes.

Wenhui Po:

I noticed that the Fifth Chapter of the White Paper covers China's defense expenditure. At the conclusion on Page 42, it states: "There is still a wide gap between China's defense expenditure and the requirements for safeguarding national sovereignty, security and development interests, for fulfilling China's international responsibilities and obligations as a major country, and for China's development." Can you elaborate on this? Thank you.

Wang Taiguo:

In the new era, to meet the strategic demands of national security and development, the armed forces are required to firmly implement the missions and tasks entrusted by the CPC and the Chinese people. They are endeavoring to provide strategic support for consolidating the leadership of the CPC and the socialist system, safeguarding national sovereignty, unity and territorial integrity, protecting China's overseas interests, and promoting world peace and development.

However, as the only major country yet to be completely reunified, and one of the countries with the most complex peripheral security environment, China faces serious challenges in safeguarding national sovereignty, territorial integrity, and maritime rights and interests.

Nowadays, with increasing global issues and challenges, as well as the development of China and its armed forces, the international community has higher expectations in regard to the international public security goods provided by the Chinese military. Therefore, our armed forces will spend more in fulfilling their international responsibilities and obligations as well as in participating in peacekeeping operations, vessel protection operations and disaster relief. 

At the same time, the armed forces are moving towards coping with the demands of the current informationization era, and shouldering arduous tasks in adapting to trends in worldwide RMA (Revolution in Military Affairs) and speeding up RMA with Chinese characteristics.

Therefore, there is still a wide gap between China's defense expenditure and the requirements for safeguarding national sovereignty, security and development interests, fulfilling our international responsibilities and obligations as a major country, and for the overall development of the country. China's defense expenditure will keep step with national economic development and maintain moderate and steady growth.

The China Times:

Page 15 of the white paper mentioned "sailing ships and flying aircraft around Taiwan." We know that we are six months away from the 2020 leadership election in Taiwan next year. During that time, will the PLA increase the frequency of warships and aircraft sailing around the island? Some opinions in Taiwan believe that the greater the movement of the People's Liberation Army, the more it will mean that the mainland will suppress and threaten Taiwan -- which will help the Democratic Progressive Party candidates gain popularity in their elections. What is your comment on that? In addition, the mainland's Ministry of National Defense recently put out news during Tsai Ing-wen's foreign visits, saying that the PLA held a routine military exercise on the southeast coast. The Global Times also quoted sources familiar with the matter and said that five military service branches were involved in the joint exercise, which would form a deterrent force for Taiwan. Please tell us about the exercise.

Wu Qian:

Indeed, as you said, many references about Taiwan in the white paper show that the Taiwan issue is of vital importance to China's core interests. We believe that the mainland and Taiwan share natural kinship, and that blood is thicker than the water. We are willing to strive for the prospect of peaceful reunification with the utmost sincerity and best efforts. However, we must resolutely point out that engaging in "Taiwan independence" is a dead end. If anyone dares to try to separate Taiwan from China, the Chinese army will certainly not hesitate to fight and resolutely defend the sovereign and territorial integrity of the country.

Regarding the second question about the exercise on the southeast coast, the Ministry of National Defense has released information on this issue, and I have nothing to add here.

China News Service:

The white paper mentions that the strategic guidance for China's national defense in the new era is to implement the military strategic guideline for a new era. Could you further introduce the strategic guideline? Thank you.

Cai Zhijun:

Thank you for your question. Since the founding of the People's Republic of China, the PLA has inherited the strategic concept and tradition of active defense and made eight major adjustments to the military strategic guideline, on average once every eight to ten years. Every adjustment was made in accordance with three principles: first, the strategic concept and military policies of the CPC are the fundamental guidance for formulating and adjusting military strategy; second, the profound changes of the international strategic landscape and its impact on national security environment are the objective reference; and third, the profound changes in military regard resulted from scientific and technological progress, especially the evolving form of war, are the motivation. 

The military strategic guideline for a new era is an important decision made by President Xi Jinping after tapping into the prevailing trend of development, with an overall vision on national security and innovation on military strategic guidance. The guideline is introduced in the following contexts: 

First, the Party's new theories have been constantly enriched and developed. The 19th CPC National Congress established Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and Xi Jinping's thinking on strengthening the military as the guiding ideology of the Party and the military, requiring us to advance with the times and innovate the strategic guidance.

Second, there are new strategic goals for national development. The 19th CPC National Congress mapped out the new "three-step" development blueprint, which entrusts the military with missions and tasks for the new era, and put forward the ambitious goal of transforming our people's armed forces into world-class forces in all respects, which demands the strategic guidance to meet the requirements of building a strong country with a strong military.

Third, the international strategic landscape has undergone profound and complicated changes. We live in a world of profound changes unseen in a century, where uncertainties unseen in a century inevitably exist. Increasing risks and challenges, both predictable and unpredictable, require the strategic guidance to better respond to national security and development demands. 

Fourth, reforms of the armed forces have realized a historic and revolutionary restructuring. Adhering to the general principle of "the CMC exercising overall leadership, the TCs responsible for military operations and the services focusing on developing capabilities," we established five theater commands, new services and units. This has put forward new requirements for the strategic guidance in regard to the building and employment of military forces.

By implementing the military strategic guideline for a new era, China will remain committed to peaceful development and pursue a defensive national defense policy, never seeking hegemony, expansion or spheres of influence, sticking to the strategic concept of active defense and continuing to strengthen the military in the Chinese way. The guideline fully put into effect the guiding principles of the 19th CPC National Congress as well as Xi Jinping's thinking on strengthening the military. As a guideline for the building and employment of military forces in the new era, it bears four historic missions:

First, it has established the fundamental guidance for military strategy. It established Xi Jinping's thinking on strengthening the military as the military strategic guidance for a new era, and fully implements it as faith and principle.

Second, it is subordinate to and in the service of national development. Focusing on effectively fulfilling the military's tasks and missions in the new era, it, through in-depth study, gives answers to a string of major strategic issues concerning the critical juncture of China's development. 

Third, it has enhanced the holistic planning of the military strategy. It takes a political and comprehensive perspective, basing in the present while looking ahead to the development, seizing the strategic key point, so as to innovate the strategic guidance. 

Fourth, it has stressed the focus on enhancing military preparedness and combat capabilities. It has prompted all work serving the aim of strengthening military preparedness and enhancing combat capabilities and made significant achievements in this regard. Thank you.

Hu Kaihong:

The last two questions please, due to time considerations.

New York Times:

In the white paper you refer to, seeking partnerships rather than alliances, and you already mentioned the joint patrol yesterday with Russia. Do you anticipate more or deepening operations with Russia or any other countries? And related to that, there were reports this week of China seeking a basing arrangement with its neighbor forces in Cambodia, do you also see and anticipate additional efforts to establish operating bases or arrangements with other countries in other parts of world? Thank you very much.

Wu Qian:

Your questions comprise several specific points, to which I'll respond one by one.

First, it concerns foreign military relations. China actively develops constructive relationships with foreign military forces. A new configuration of foreign military relationships that is all-dimensional, wide-ranging and multi-tiered is taking shape. However, what we are engaged in are dialogues rather than confrontations, and partnerships rather than alliances. Regarding your questions about whether China and Russia will continue to hold joint aerial patrol, this will depend on the negotiations and decisions reached between the two sides on pragmatic cooperative programs. As we all know, the military relationship between China and Russia, following the epochal bilateral ties, is entering a new era. Under the strategic blueprint charted by the two State leaders, the bilateral military relationship is expected to achieve historical peaks one after another. The two countries will support each other's core interests, improve cooperative institutions on multi-tiered levels and expand cooperation in high-level exchanges, strategic partnership, military training, equipment technology and counter-terrorism. In doing so, we are positively acting to fulfill our duties to safeguard global peace and strategic stability.

In addition, you asked about the so-called military base arrangement in Cambodia. Our relevant administrations have already clearly stated that this is nothing but rumors. Although the two countries have maintained good cooperation through exchanges in military exercises, personnel training, logistical services and equipment development, our partnership targets no third party.

Hu Kaihong:

The last question.

Now TV (Hong Kong):

There have been so many conflicts and demonstrations in Hong Kong recently. How did the Ministry of National Defense evaluate and judge the situation there? Also, do you feel that some "Hong Kong independence" forces are also on the rise, and, if so, how will the Ministry of National Defense handle this?

Wu Qian:

In recent weeks, we have closely followed development of the situation in Hong Kong, especially the demonstrations and violent incidents on July 21, as well as the incident in which radical demonstrators violently besieged and stormed the Liaison Office of the Central People's Government in the HKSAR. The Hong Kong and Macao Affairs Office of the State Council has already responded to this. The behaviors of some radical demonstrators have blatantly challenged the authority of the central government and touched the bottom line of the principle of "one country, two systems." Such behaviors are absolutely intolerable. "The Pearl of the Orient", Hong Kong, is not to be tarnished. Regarding the specific question you raised, the answer is that Article 14 of Chapter 3 of the HKSAR Garrison Law of the People's Republic of China has specific provisions in this regard.

Hu Kaihong:

This concludes the press conference today. Thank you all.

Read in Chinese

Speaker:

Mao Shengyong, spokesperson of the National Bureau of Statistics (NBS) and director general of the Department of Comprehensive Statistics.

Chairperson:

Shou Xiaoli, Press Bureau of State Council Information Office

Date:

July 15, 2019

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference. Today, we are releasing China's economic data. We are pleased to welcome Mr. Mao Shengyong, the spokesperson of the National Bureau of Statistics (NBS) and director general of the Department of Comprehensive Statistics, to introduce China's economic performance in the first half of 2019 and answer some of your questions.

Now, I'll give the floor to Mr. Mao.

Mao Shengyong:

Thank you. Ladies, gentlemen, friends from the media, good morning everyone. I'll first give you a brief introduction of China's economic performance in the first half of 2019, and then answer some of your questions.

In the first half this year, China's economy remained stable while making further progress. In view of the complex domestic and international environment, under the firm leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, all regions and departments implemented the decisions and arrangements made by the CPC Central Committee and the State Council, and followed the general principle of pursuing progress while ensuring stability. We adopted the new development philosophy, promoted high-quality development, focused on supply-side structural reform, and further improved our efforts in reform and opening up. We also intensified efforts to ensure stable employment, a stable financial sector, stable foreign trade, stable foreign investment, stable domestic investment, and stable market expectations. Due to these efforts, the Chinese economy has been operating within a proper range, and remained stable while making further progress.

According to preliminary statistics, in the first half this year, GDP reached 45.09 trillion yuan, up 6.3% year-on-year in comparable prices. On a quarterly basis, the year-on-year increase was 6.4% and 6.2% respectively. In regard to the different industrial sectors, the added value of the primary, secondary and tertiary industries was 2.32 trillion yuan, 18.00 trillion yuan and 24.77 trillion yuan respectively, up 3.0%, 5.8% and 7.0% year-on-year.

Mao Shengyong:

First, the agricultural sector posted a sound performance following a bumper harvest of summer grain.

In the first half of this year, the added value of the crop farming sector posted a year-over-year increase of 3.9%, and the growth rate was 0.5 percentage point lower than that of the first quarter. The overall output of summer grain amounted to 141.74 million tons, 2.93 million tons more than last year, showing a yearly growth of 2.1%, which met the highest record (registered in 2017) of summer grain production. The structure of crop farming continues to be improved, as the planting area for cotton and soybean increased. On a year-on-year basis, in the first half, the output of eggs increased 3.6%; the output of milk increased by 1.7%; the output of pork, beef, mutton and poultry decreased 2.1% to 39.11 million tons. Specifically, the output of beef, mutton and poultry were up by 2.4%, 1.5%, and 5.6% respectively, while the output of pork was down by 5.5%.

Second, industrial production was generally stable, and the proportion of high-tech manufacturing rose.

In the first half of this year, the growth of the total value added of industrial enterprises above the designated size was 6.0%, and the growth rate was 0.5 percentage point lower than that of the first quarter. Meanwhile, the growth of the total value added of industrial enterprises above the designated size in June was 6.3%, and the growth rate was 1.3 percentage points higher than that of May, up 0.68% on a month-on-month basis. An analysis by types of ownership showed that the value added of state holding enterprises was up by 5.0%; that of share-holding enterprises up by 7.3%; and enterprises funded by foreign investors or investors from Hong Kong, Macao, and Taiwan up by 1.4%. 

In terms of sectors, the value added of the mining industry increased by 3.5%; that of manufacturing increased by 6.4%; and that of the production and supply of electricity, thermal power, gas and water increased by 7.3%. The value added of strategic emerging industries grew by 7.7% year-on-year, or 1.7 percentage points higher than that of the industrial enterprises above the designated size. The added value of the high-tech manufacturing increased by 9.0%, or 3.0 percentage points higher than that of industrial enterprises above the designated size, accounting for 13.8% of all industrial enterprises above the designated size, and this proportion is 0.8 percentage point higher than that in the same period last year. The production of new energy vehicles and solar batteries showed a year-on-year growth by 34.6% and 20.1% respectively.

From January to May, the profits made by industrial enterprises above the designated size stood at 2.38 trillion yuan, down 2.3% year-on-year. The decrease was 1.1 percentage points lower than that from the first four months. The profits made by industrial enterprises above the designated size in May grew by 1.1%, while the profits in April decreased by 3.7% on a year-on-year basis. The profit rate of business revenue of industrial enterprises above the designated size was 5.72%, 0.2 percentage point higher than that from the first four months.

Third, the service sector grew rapidly and the modern service industry is booming.

In the first half of this year, the service sector took on a sound momentum of development. Respectively, the year-on-year growth of information transmission, software and information technology service, that of leasing and business service, that of transportation, storage and postal service, and that of financial sector stood at 20.6%, 7.8%, 7.3%, and 7.3%, which is 13.6 percentage points, 0.8 percentage point, 0.3 percentage point and 0.3 percentage point faster than the growth of the tertiary sector.

In the first half of this year, the Index of Services Production increased by 7.3% year-on-year, and the growth rate drop by 0.1 percentage point from the first quarter. In June, the index was up by 7.1%, 0.1 percentage point higher than that in May. The Business Activity Index for services was 53.4% in June, which continued to stand above the 50-point mark separating growth from contraction. The index was 60.3%, showing a high-level performance.

The business revenue of service enterprises above the designated size from January to May increased by 10.1% on a year-on-year basis, and the growth rate was 0.3 percentage point faster than that from the first four months. Of those, the business revenue of strategic emerging services, high-tech services and technology services demonstrated fast growth, which increased by 12.5%, 12.3% and 12.0% respectively, or 2.4 percentage points, 2.2 percentage points and 1.9 percentage points faster than the growth of the service enterprises above the designated size.

Mao Shengyong:

Fourth, the market sales increased steadily, with the growth rate and proportion of online retail continuing to increase.

In the first half of this year, the retail sales of consumer goods totaled 19.52 trillion yuan, up 8.4% year on year, 0.1 percentage point faster than the first quarter. In June, the total retail sales of consumer goods was 3.39 trillion yuan, up 9.8% year on year, 1.2 percentage points faster than the previous month, and up 0.96% month on month. In a breakdown by location of business units, in the first half of this year, the retail sales of consumer goods in urban areas was 16.69 trillion yuan, up 8.3% year on year; that in rural areas was 2.83 trillion yuan, up 9.1% year on year. From the perspective of the types of consumption, revenue from the catering sector reached 2.13 trillion yuan, up 9.4%; retail sales of commodities totaled 17.39 trillion yuan, up 8.3%. Sales of goods representing consumption upgrade grew rapidly, with that of cosmetics companies above designated size growing 13.2% year on year, 4.8 percentage points faster than the total retail sales of consumer goods.

In the first half of this year, China's online retail sales totaled 4.82 trillion yuan, up 17.8% year on year, 2.5 percentage points faster than the first quarter. Of this, online retail sales of physical goods was 3.82 trillion yuan, up 21.6%, accounting for 19.6% of the total retail sales of consumer goods, and 1.4 percentage points higher than that in the first quarter.

Mao Shengyong:

Fifth, investment reported stable growth, with that in high-tech industries growing rapidly.

In the first half of this year, China's fixed asset investment (excluding rural households) totaled 29.91 trillion yuan, up 5.8% year on year, 0.2 percentage point faster than January-May, and 0.5 percentage point lower than that in the first quarter. Of this, the private investment was 18.03 trillion yuan, up 5.7%. In a breakdown by industry, investment in primary industries fell by 0.6%; investment in secondary industries grew by 2.9%, with that in manufacturing up 3.0%; investment in tertiary industries rose by 7.4%, with that in infrastructure up 4.1%.

Investment in the high-tech manufacturing sector grew by 10.4% year on year, 4.6 percentage points faster than the total; that in the high-tech services sector grew by 13.5%, 7.7 percentage points faster than the total. On a month-on-month basis, investment in fixed assets (excluding rural households) increased by 0.44% in June.

In the first half of this year, China's fixed asset investment (excluding rural households) totaled 29.91 trillion yuan, up 5.8% year on year, 0.2 percentage point faster than January-May, and 0.5 percentage point lower than that in the first quarter. Of this, the private investment was 18.03 trillion yuan, up 5.7%. In a breakdown by industry, investment in primary industries fell by 0.6%; investment in secondary industries grew by 2.9%, with that in manufacturing up 3.0%; investment in tertiary industries rose by 7.4%, with that in infrastructure up 4.1%.

Investment in the high-tech manufacturing sector grew by 10.4% year on year, 4.6 percentage points faster than the total; that in the high-tech services sector grew by 13.5%, 7.7 percentage points faster than the total. On a month-on-month basis, investment in fixed assets (excluding rural households) increased by 0.44% in June.

Mao Shengyong:

Sixth, the growth rate of imports and exports increased slightly, and the trade structure continued to improve.

In the first half of this year, the import and export value totaled 14.67 trillion yuan, up 3.9% year on year, 0.2 percentage point faster than the first quarter. Of this, the export value was 7.95 trillion yuan, up 6.1%; the import value totaled 6.72 trillion yuan, up 1.4%. The trade surplus was 1.24 trillion yuan, up 41.6% year on year.

The country further improved the mode and structure of trade. The import and export value of general trade increased by 5.5%, accounting for 59.9% of the total import and export value, 0.9 percentage point higher than the same period last year; the export value of mechanical and electrical products increased by 5.3%, accounting for 58.2% of the total export volume. The import and export value of private companies increased by 11.0%, accounting for 41.7% of the total import and export value, 2.7 percentage points higher than the same period last year.

In June, the import and export value totaled 2.56 trillion yuan, up 3.2% year on year. Of this, the export value totaled 1.45 trillion yuan, up 6.1%; the import value totaled 1.11 trillion yuan, down 0.4%.

In the first half of this year, the delivery value of exports of companies above designated size reached 5.84 trillion yuan, up 4.2% year on year. In June, the figure reached 1.06 trillion yuan, up 1.9%, 1.2 percentage points faster than that registered in May.

In the first half of this year, the delivery value of exports of companies above designated size reached 5.84 trillion yuan, up 4.2% year on year. In June, the figure reached 1.06 trillion yuan, up 1.9%, 1.2 percentage points faster than that registered in May.

In the first half of this year, China's consumer prices rose 2.2% year on year, 0.4 percentage point higher than that in the first quarter. Of this, consumer prices in both urban and rural areas rose by 2.2%. By category, the prices of food, tobacco and alcohol rose 3.9% year on year, the prices of clothing rose 1.8%, housing prices increased 2.0%, the prices of daily necessities and services rose 1.1%, the prices of transportation and communications fell 1.0%, the prices of education, culture and entertainment rose 2.5%, the prices of medical care increased 2.6%, and those of other goods and services rose 2.2%. Among food, tobacco and alcohol prices, grain prices rose 0.5%, pork prices increased 7.7% and the prices of fresh vegetables rose 9.2%. The core CPI excluding food and energy prices rose 1.8% year on year, 0.1 percentage point lower than the first quarter. In June, the consumer prices rose 2.7% year on year, unchanged from the previous month, down 0.1% month on month.

In the first half of this year, producer prices rose 0.3% year on year, 0.1 percentage point higher than that in the first quarter. In June, producer prices remained flat year on year and down 0.3% month on month. In the first half of this year, the purchasing prices of producers rose 0.1% year on year, the same as that in the first quarter. In June, the purchasing prices of producers fell by 0.3% year on year and 0.1% month on month.

Mao Shengyong:

The employment situation generally remained stable, and the total number of rural workers working outside their hometowns continued to increase.

In the first half of the year, 7.37 million new urban jobs were created across the country, meeting 67% of the annual employment target. The surveyed urban unemployment rate was 5.1% in June, up 0.1 percentage points from May. The urban unemployment rate among the people aged between 25-59 was 4.6%, 0.5 percentage points lower than the overall national urban figure. The jobless rate in 31 major cities and towns was 5.0%, the same as May. In June, the average weekly working hours of employees in enterprises nationwide was calculated at 45.7 hours. By the end of the second quarter, the number of rural laborers forming the migrant workforce operating outside their hometowns reached 182.48 million. This was an increase of 2.26 million or 1.3 percent year-over-year. The gain in the second quarter was 0.1 percentage points higher than the first quarter.

Mao Shengyong:

The growth rate of residents' income exceeded that of national economy, and the income gap between urban and rural residents further narrowed.

In the first half of the year, national per capita disposable income was 15,294 yuan, a nominal gain of 8.8% year-over-year, with a 0.1 percentage points increase in the pace between the first and second quarters. With actual growth of 6.5 % after adjusting for inflation, the figure was 0.2 percentage points higher than the national economic growth rate. Classified according to residents' permanent residence locations, urban residents' per capita disposable income was 21,342 yuan (actual growth 5.7%). Rural residents' per capita disposable income was 7,778 yuan (actual growth 6.6%). The per capita disposable income ratio between urban and rural residents stood at 2.74, down 0.03 year-over-year. The median per capita disposable income of national residents was 13,281 yuan, a nominal gain of 9.0% year-over-year.

Mao Shengyong:

Supply-side structural reform further deepened, and the economic structure has seen continuous progress in optimization.

We have consolidated the results achieved in the priority tasks of cutting overcapacity, reducing excess inventory, deleveraging, lowering costs and strengthening identified areas of weakness. In the second quarter, the national industrial capacity utilization rate was 76.4%, or 0.5 percentage points higher than the first quarter, and one percentage point higher than the average achieved since 2013. Among the figures, the industrial capacity utilization rates of the non-metallic mineral products industry, the ferrous metal smelting and rolling industry, and the non-ferrous metal smelting and rolling industry increased by 3.4, 1.7 and 1.7 percentage points respectively from the first quarter. By the end of June, the total floor space of commercial buildings for sale stood at 501.62 million square meters, which was 7.66 million square meters less than the figure at the end of May, and 8.9% lower year-over-year. By the end of May, the asset-liability ratio of industrial enterprises above designated size was 56.8%, down 0.6 percentage points year-over-year. In the first half of the year, investments in deprived areas of ecological preservation and environmental treatment as well as education grew respectively by 48.0% and 18.9% year-over-year (respectively 42.2, and 13.1 percentage points faster than the average growth of investments in all fields).

We continue the critical battles against major risks, poverty, and pollution. By the end of May, total local government debt stood at 19.8953 trillion yuan, which was within the limits approved by the National People's Congress. Targeted poverty alleviation made strong progress. The per capita disposable income of rural residents in poverty-stricken areas maintained comparatively rapid growth. Marked achievements were recorded in pollution prevention. Preliminary assessments indicate that, in the first half of the year, the share of clean energy consumption involving natural gas, hydropower, nuclear power and wind power in total energy consumption increased by 1.6 percentage points over the same period of last year, and energy consumption per unit of GDP dropped 2.7 percent year-over-year.

We have continuously optimized the economic structure. In the first half of the year. The tertiary industry's added value accounted for 54.9% of GDP, up 0.5 percentage points year-over-year, and 15.0 percentage points higher than the figure for secondary industry. The tertiary industry's contribution rate to GDP growth was 60.3%, or 23.2 percentage points higher than that of the secondary industry. Among industries above designated size, the strategic emerging industry and the high-tech industry maintained rapid growth. The contribution rate of final consumption expenditure to economic growth was 60.1%. Among the final consumption spending of all residents, service consumption accounted for 49.4%, up 0.6 percentage points year-over-year. We have steadily promoted a series of major regional development strategies, including the coordinated development of the Beijing-Tianjin-Hebei Region and the integrated development of the Yangtze Economic Belt, the Guangdong-Hong Kong-Macao Greater Bay Area, and the Yangtze River Delta. A new pattern of overall development across the country is taking shape.

Mao Shengyong:

In general, the national economy operated within a reasonable range in the first half of the year, having achieved generally stable growth while making further progress. However, we must also note that the current domestic and international economic situation remains complicated and severe. Global economic growth has slowed down, external instability and uncertainties have increased, and the problem of domestic development imbalance is still outstanding, while the economy faces new downward pressures.

In the next stage, we need to take Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guide, seriously implement the decision-making arrangements and deployments of the Central Committee of the Communist Party of China and the State Council, adhere to the general approach of steady progress, and maintain supply-side structural reform as the principal direction, while promoting high-quality development, deepening reform and opening up, optimizing the business environment, promoting independent innovation in key areas, so as to fully mobilize the enthusiasm of all parties. We also need to pay close attention to the implementation of the policies to stabilize employment, finance, investment, foreign trade, foreign investment, and expectations so as to ensure a steady and healthy economic development. Thank you.

Shou Xiaoli:

Thank you, Mr. Mao. Now, we will open the floor for media questions. Please tell us the name of your news organization before asking questions.

CCTV:

Since the beginning of this year, the economy has been under pressure and the downward pressure has increased. Based on the statistics you have just released, how would you evaluate China's economic development in the first half of the year? Thank you.

Mao Shengyong:

Thank you for your question. In the first half of this year, faced with a complicated situation at home and abroad, the economic growth maintained general stability and registered good progress. The main macroeconomic indicators are operating in a reasonable range and the economic structure is being optimized. The general characteristics are as follows:

First, the three main industrial sectors continued to develop. Agricultural production is relatively good, and there has been a bumper harvest of summer grain. The total output of summer grain this year increased by 2.1%, matching the record production achieved in 2017. Industrial growth was basically stable. In the first half of the year, the added value of industrial enterprises above designated size increased by 6%. In June, the gain was 6.3%, 1.3 percentage points faster than in May. The service industry continued to maintain rapid growth. In the first half of the year, the added value of the service industry increased by 7%. The service industry production index in June was 0.1 percentage points higher than that of May.

Second, the "Troika" is running smoothly. Consumption growth has generally accelerated. In terms of total retail sales of consumer goods, the six-month increase was 8.4%, showing a slightly faster rate compared to the first quarter. In particular, the total retail sales of consumer goods in June increased by 9.8%, 1.2 percentage points faster than the previous month. Investment growth is stabilizing. In the first half of the year, fixed assets investment increased by 5.8%, 0.2 percentage points higher than that in January-May. The import and export situation was better than expected. The total import and export volume of goods increased by 3.9% in the first half of the year, slightly faster than in the first quarter. June saw a further improvement over the May performance.

Mao Shengyong:

Third, the three major economic indicators are fared well. Employment was generally stable with 7.37 million new jobs created in urban areas in the first half of the year, meeting 67% of the 2019 target. The survey-based urban unemployment rate was held at around 5% in June; Market prices were also generally stable as the CPI grew by 2.2% year-on-year in the first half of the year, and the core CPI (excluding food and energy) rose 1.8%. That means consumer prices have only seen moderate growth; the PPI saw slight growth of around 0.3% year-on-year in the first half of the year.

At the same time, incomes have grown in tandem with economic development. Per capita disposable income rose 6.5%, which was 0.2 percentage points higher than the overall economic growth rate. One thing worth noting is that the disposable income of rural residents had grown faster than that of urban residents, and this is helping further bridge the urban-rural income gap.

Fourth, the industrial structure, the demand structure and the foreign trade structure all continued to be optimized. In regard to the industrial structure, agriculture consolidated its primary sector status, while the product mix continues to be further optimized. In the first half of the year, there was an increase in the planting area for soybeans and other cash crops.

Transformation of the secondary sector also continued to gather pace. For example, the value added component of high-tech manufacturing rose 9%, or three percentage points faster than that of industrial enterprises above designated size, and its proportion of the total value added of industrial enterprises above the designated size rose 0.8 percentage points year-on-year.

The tertiary sector continues to increase its contribution to economic growth. Proportionally, the value added of tertiary sector contributed an additional 0.5 percentage points to total GDP compared to last year. Thus, we continue to see a strong momentum in the development of a modern service industry.

In terms of the demand structure, consumption is consolidating its primary role in promoting economic growth. In the first half-year, an increase of consumption contributed 60.1% of GDP growth; the investment structure is also being optimized with expenditure on social development, high-tech industries and the manufacturing transformation being maintained at over 10% of the total investment mix.

The foreign trade structure has also improved. The proportion of general trade continues to rise year-on-year.

So, these are how major macroeconomic indicators performed in the first half of this year. Thank you.

Reuters:

In the first half of the year, China pursued intensified fiscal policies, like the tax cut of two trillion yuan and the issuance of special bonds worth 2.15 trillion yuan. However, some people don't think these policies have yielded obvious results in terms of data. How will you comment on that? And against the backdrop of the trade tension, is there any new policy in the second half of year to guarantee this year's growth target? Moreover, could you tell us the contribution of gross capital formation and the net exports of goods and services to GDP growth? Thank you.

Mao Shengyong:

In the first half of this year, the contribution made to GDP growth by consumption, gross capital formation and the net exports of goods and services were respectively 60.1%, 19.2% and 20.7%. 

In regard to the counter-cyclical adjustments, there is both a proactive fiscal policy and a prudent monetary policy. Since the end of last year, in order to cope with the external uncertainties and downward pressure on the Chinese economy, a series of policies have been released and vigorously implemented. For example, we have pursued a proactive fiscal policy with greater intensity and enhanced its performance, adopted a prudent monetary policy that retained an appropriate degree of flexibility and pursued a proactive employment policy with full force. With regard to fiscal policies, we have increased expenditures including raising intensity and pace of special bonds issuance as well as increasing their amounts. Moreover, more efforts have been made to cut taxes and fees. These policies have been starting to pay off since April and May. Our survey shows that enterprises have benefited from cutting taxes and fees. The statistics also show that the growth of investment in infrastructure accelerated during the Jan-June period, and the growth of investment in the manufacturing sector also rebounded in the last two months. All these indicate that the relevant policies have produced results and we expect them to continue to pay off in the second half of the year.

However, it is worth noting that investments in some sectors, including manufacturing and infrastructure, are still at a low level. We will, with more policies being implemented, continue to deepen reforms, improve the business environment and further invigorate market entities. We expect a better economic performance in the second half of the year. Thank you.

Economic Daily:

Since the growth rate of the Chinese economy fell in the first half of this year, will it continue to drop in the third quarter？Is there any pressure to achieve the anticipated economic growth ranging between 6% to 6.5% this year? Are there any difficulties in reaching the targeted range? Thank you.

Mao Shengyong:

Thank you for your questions. The national economy achieved a growth rate of 6.3% during the first half of this year, which is a relatively good performance. I interpret the key part of your question as how to view the growth rate, and from my perspective, these are the key elements.

First, the rate of 6.3% represents a moderate and stable level. How can we substantiate that belief? During the first quarter of this year, the economy rose by 6.4%, which was only 0.1 percentage point higher than what was finally achieved during the first six months. Furthermore, if we take into consideration the various indices, including employment, prices, incomes and endeavors to ensure a quality ecological environment, the economy is running within an appropriate range.

Second, a rate of 6.3% isn’t slow by any means. During the first quarter, the economic growth rate of 6.4% was certainly the best achieved right across the globe. Even though not all countries have yet released their economic growth figures for the first half of this year, it is probable that there was a general trend of global economic slowdown. Therefore, a growth rate of 6.3% achieved over the six months still ranks high.

Third, this rate of 6.3% indicates quality growth. While considering the economic performance we have achieved, we also need to be concerned about a number of important factors, such as relatively stable employment, increases in consumer prices that were moderate and, indeed, close to zero compared to fast-growing household incomes, and the decline of 2.7% in energy consumption per 10,000 yuan of GDP. Hence, such a growth rate means sustainable development with high quality.

Fourth, that growth rate of 6.3% wasn’t easily achieved. We all know that, since last year and continuing into the first half of this year, global economic growth and trade expansion have been slowing. In addition, the domestic economy, affected by underlying structural problems extending over quite a period of time, has been running under certain downward pressures. In such a context, the national economy has been growing steadily due to innovation-driven reforms, new macro-economic approaches, an improved business-friendly environment, reductions in taxes and administrative fees and the revived vitality of many market entities, rather than under some overwhelmingly strong stimulus plans.

Fifth, the growth rate of 6.3% is immensely sustainable. Achieving that during the first half of this year provides a solid foundation for an annual growth rate expected to range between 6.0% to 6.5%. Looking at the second half of this year, the external environment will probably remain complicated, and there are still downward domestic pressures to be handled. Despite that, the economic performance will still sustain stable momentum and the economic policies, with an increasingly competitive domestic market, still have a great number of options available. All in all, the various factors combined can ensure that the major goal for this year’s economic development can be achieved. Thank you.

Bloomberg:

My first question is on industrial production. If you look at the export data for June, there was a shrink of 1.3%, but industrial production is up 6.3% in the same period. There has been a substantial divergence between exports and industrial production over the course of the whole year. And especially if you look at the PMI numbers. New export orders are down about 46%, and the overall PMI numbers are also below 50%. How do you explain the divergence between exports, the PMI and industrial production data which seemed very stable? The second question is how much of the contribution of net exports is due to the fall in imports? Imports have fallen and exports have also fallen. But imports have fallen a lot more, which will lead to a bigger increase from net exports in the contribution to GDP. So, how much is the effect of the contribution of net exports to GDP is due to the decline in imports? Thank you.

Mao Shengyong:

Thank you for your two important questions. The first question is about the relationship between industrial growth, industrial exports and the PMI. In June, the value-added output of industrial enterprises above the designated size increased by 6.3% year-on-year, higher than that of May. The volume of industrial exports was stable in June, with the export delivery value of industrial enterprises above the designated size growing faster than in May. This data is based on the relevant indicators released by the NBS.

From this perspective, industrial growth and exports are generally matched. In June, the manufacturing industry’s PMI remained the same as the previous month, a little lower than the 50% threshold. However, in terms of the scale of enterprises, the index of large enterprises remained basically the same, while that of small and medium-sized enterprises registered a slight rise. Generally speaking, there is no big contradiction between the three indicators. In addition, when analyzing the relationship between indicators, we’d better consider the data of more than a month so that we can have a better grasp of the overall trend.

The second question is about the contribution of net exports, namely net exports of goods and services, to economic growth. The contribution rate was 20.7% in the first half of this year, higher than during the same period last year and the first quarter of this year. This is due to two factors. First, the value of total exports minus the value of total imports of goods and services, namely net exports, or trade surplus in goods, showed considerable expansion compared to the same period last year. At the same time, the trade deficit in services became smaller. Thus, the overall trade surplus in goods and services expanded.

To get an accurate and comprehensive picture of how the three drivers, namely consumption, exports and investment, contribute to economic growth, we have to take account of factors beyond the contribution rate. The first is economic structure, such as the sheer proportion of the three drivers in GDP. The recent years have witnessed a continuous rise in the share of domestic demand, and a fall in that of net exports of goods and services. China’s economic growth relies increasingly on domestic demand, especially consumption.

The second is speed, such as the growth of consumption, investment or gross fixed capital formation and net exports of goods and services. Overall, consumption and investment combined, or domestic demand, outpaced net exports during these years. The third is contribution rate, which reflects how much contribution the three drivers respectively make to economic growth.

In short, in order to reach an accurate conclusion about how the three drivers contribute to economic growth, we need to take into consideration not only their contribution rate, but also their own growth and share in the economy. By doing so, we concluded that China’s economic growth indeed relies increasingly on domestic demand, especially consumption. The central government has instructed that more focus be given to boosting the domestic market. Thank you.

China News Service:

According to a recent NBS report, China's per-capita GDP has surpassed $9,700. This had led some people to believe that China has escaped the middle-income trap. What's your view on this issue? Thank you.

Mao Shengyong:

Thank you for the question. First of all, the NBS is working on a series of reports that shows the achievements of China's economic and social development over the past 70 years. Three of the reports were recently released, and have won positive responses. There are still nearly 20 reports to be released. Please continue to follow us in this regard.

Second, the sum you mentioned in our first report was $9,732 to be accurate, and it was last year's per-capita gross national income (GNI). This index is different from GDP. GDP refers to the total added value produced by the permanent entities in a country or region in a period. It reflects economic growth from the perspective of production. In contrast, GNI was previously known as gross national product (GNP). The name was changed in 1993. It reflects the distribution of income among residents, government and enterprises. In 1993, the United Nations and some other international organizations adopted this name when revising statistics, because they found the name GNP not accurate for the concept. From then on, GNP has been gradually replaced by GNI.

Third, GNI and GDP are also related to each other. For instance, GNI is calculated on the basis of GDP. It is the sum of GDP plus the net income earned by foreign entities. Previous statistics show that there was no big difference between China's GDP and GNI, as the former was just a little higher than the latter. Please note that GNI is also different from resident disposable income, as the former consists of the net incomes of government, enterprises, residents and foreign entities. It is obviously much higher than the latter.

Fourth, you asked a question that many people are also eager to know the answer to. According to the standards of the UN, China is in the upper-middle income group. It must be admitted that after the rapid development over the past 40 years, China's economic situation and international status have improved remarkably, with the Chinese economy ranking second in the world. However, the per-capita income of the country has remained low. Figuring out when China will become a high-income country depends on many factors. Whether a country is a high-income country is decided by the status of other countries. When we will become a high-income country should be decided by our economic growth rate, price level, the development of other countries, as well as the exchange rates of the yuan, U.S. dollar and other currencies. Besides, international organizations may also change the methods of classification. Therefore, instead of discussing whether and when China can be ranked as a high-income country, we'd better focus on promoting economic development, improving people's livelihood and income, upgrading our economy and making it more efficient, so as to strive for high-quality development. Thank you.

21st Century Business Herald:

There may have been some answers already, but I would still like to ask. We have seen that the growth of industrial investment, the service sector and consumption all picked up in June, but the overall economic growth rate in the second quarter went down. What is behind the rebound of the growth rates in June? Will it last? In addition, the urban unemployment rate rose slightly in June. What do you think of the current employment situation? Thank you.

Mao Shengyong:

Thank you. You just asked two questions. The first one is whether the rebound of the growth rates in some indicators in June will last and what will happen in the second half of this year. The second question is about my views on the current employment situation.

As for your first question, we saw some indicators in June indeed picked up compared with those in May, including the industrial growth, as well as the growth of the retail sales of consumer goods and the production index of the service sector. For example, the total retail sales of consumer goods increased 9.8% in June, up 1.2 percentage points from May. The two main reasons are as follows. First, car sales performed better than expected. With the national standards for pollutant discharge of motor vehicles switched from Stage V to VI, promotional efforts were stepped up in June to increase automobile sales, which is a key reason for the better performance. The sales of automobiles by companies above designated size increased over 17%, driving the total retail sales of consumer goods to increase about 1.6 percentage points. Second, online retail sales in June performed relatively good. With promotional activities on June 18, we saw the online sales of cosmetics and household appliances grow at a relatively fast speed. These two factors combined to accelerate the growth of total retail sales in June. The growth of total retail sales of consumer goods had an obvious driving effect on the growth of the production index of the whole service sector, so these two indicators are correlated. As for industrial growth, we can look at the facts that the output and the value added of most industries and products increased in different degrees in June compared with those in May, and that there was also growth in export delivery in June. Thus, the growth figures were well-founded and also related with each other on the whole.

As for the second half of this year, there will be both positive and negative factors. On one hand, there will still be downward pressure for these indicators; on the other, there will be many favorable factors to support their stable performance. For example, the government will constantly stimulate more vitality in the market, and gradually implement a series of counter-cyclical adjustments, including a policy of stabilizing employment, trade, investment, finance, foreign investment and market expectations. These policies will have a more obvious effect on the indicators in the second half of this year, and all the above will be conducive to the stable performance of these indicators in the second half of the year.

The second question is about the unemployment rate. The surveyed unemployment rate in cities and towns increased 0.1 percentage point in June compared with that in May. Overall, the employment situation was still relatively stable, with the surveyed unemployment rate staying around 5%; however, we should notice that there are still some structural problems behind the overall stability that need to be addressed. In particular, with nearly 8.3 million university students graduating this year, there is still an increasing pressure on employment. As the graduation season comes in July and August, there is still some structural pressure on employment. Some traditional industries, including those undergoing structural transformation and overcapacity reduction, may also bring structural pressure on employment. The central government has paid close attention to employment, as it is the foundation of people's livelihood. This year, we have raised the priority of the employment policy to the same level as the proactive fiscal policy and the prudent monetary policy. Moreover, priority has been given to employment as the country takes major actions to keep stability. The government has also introduced many practical measures. On one hand, the employment situation remains stable on the whole; on the other, there are some structural problems and pressures that need our attention. With a series of policies and measures to stabilize and promote employment, we are able to maintain an overall stable employment situation. Thank you.

CNR:

In June, the PPI leveled off compared to the figure for the same period last year and actually fell 0.3% month-on-month. Some industry insiders are concerned about a potential deflation or inflation in the Chinese economy. Do you see the PPI continuing to fall in the second half of the year? Could you please give us your analysis? Thank you.

Mao Shengyong:

Thanks for your question. First, generally speaking, the PPI maintained moderate growth in the first half of this year, or around 0.3% year-on-year. In the next stage, it will be influenced by both the supply-demand situation as well as developments in the international environment, such as fluctuations in commodity prices. In general, I think there are likely to be some slight fluctuations ahead, but we will have to see how it goes.

Second, you talked about inflationary and deflationary risks, which are related to both economic performance and price changes. When we look at the price changes, we must analyze both the PPI and the CPI. If you put the two indicators together for the first half of this year, the CPI rose 2.2% and the PPI 0.3% year-on-year. Thus, you can see that prices were generally experiencing some modest growth while also stabilizing. Despite a slight fall, China’s economic growth, at 6.3% from January-June, still ranked among the top performers when compared to other major economies. Therefore, it is groundless to say that China may face either a deflationary or an inflationary risk. Thank you.

Market News International:

You just said the economic operation in the second half of the year has strong support. There is still a lot of room for policies. Can you give us a more detailed outlook on policy orientation around the real estate industry and infrastructure industry? For example, what change will there be for the state's attitude toward real estate investment, and what direction will the local governments turn to in terms of infrastructure investment? Thank you.

Mao Shengyong:

Thank you for your question. When it comes to investment, we say that it has three major components: first, manufacturing investment, second, infrastructure investment, and third, real estate investment. Real estate investment has maintained relatively rapid growth since last year, with a growth rate of about 10%. It has slightly declined from January to June, at 10.9%. Infrastructure investment growth has accelerated slightly from January to June, faster than that from January to May. Manufacturing investment growth has accelerated slightly in the past two months. All the above are the basic performances of the three major investments in recent months.

Speaking of real estate, from the statistics I just released, including the situation about housing prices released by the National Bureau of Statistics today at 9:30 am, we put together indicators of real estate aspects including housing prices, real estate investment, real estate sales, construction area, land transactions, etc., and examined them comprehensively and found that the current real estate market is still running smoothly. This is the first point. Second, for the next stage, on one hand, urbanization is still advancing, and there are still rigid and improvement demands from buyers. On the other hand, the concept of "houses are for living in, not for speculation" is more and more deeply rooted in the hearts of the people. Then we emphasize "particular policies for particular cities" and stress the main responsibility of the city government. With the two factors combined, stable land prices, stable housing prices and stable expectations can be achieved for the real estate market in the next stage. Under such circumstances, real estate investment will change radically.

From the perspective of infrastructure investment, I personally understand that our policy effects will continue to be exerted, including the strengthened issuance of special bonds. The introduction of some new measures has indeed accelerated the process of approvals for major projects that can complement shortcomings and provide strong stamina. In the next phase, these projects will gradually come to fruition, so infrastructure investment should rebound at a low level as expected. Thank you.

Hong Kong Commercial Broadcasting:

As we can see, the second quarter produced the lowest growth in 27 years. After the trade negotiation between Beijing and Washington resumes, do you think economic growth will continue to fall to a new low or can it recover in the second half of the year? Thanks.

Mao Shengyong:

As I said, China's economic growth reached 6.3 percent in the first half of the year, which does indeed represent a comparative slowdown in contrast with the past. However, if the increasingly harsh and complicated internal and external environments are considered as the backdrop, the speed remains high, particularly compared to other major economies in the world. 

So, judging from this angle, we should adopt a broader vision to comprehend the current growth speed. Using a new development concept, we have to look beyond growth speed in dealing with the economy. On the one hand, the economy is operating in a stable manner within a rational range. On the other hand, more energy is being expended on restructuring the economy and upgrading various industries. We cannot compromise our policies just for the sake of maintaining a certain growth speed. So, it is fair to say the current growth involves solidity, quality and sustainability, and is in line with the requirements of the new development concept. Therefore, its gold content is comparatively high. This is the first point.

Secondly, world economic growth, including international trade, has slowed down to some extent. Against this backdrop, in the first half of the year, although China's economic growth slightly decelerated, it still operated in a stable form within a rational range. And this is not so easy to come by.

The indicators of employment, commodity prices, incomes and protection of the ecology and environment all performed well. This indicates that, in order to respond to the changes in the external environment, we need to pay more attention to maintaining strategic concentration, and focusing on managing our own business well. For instance, we should focus more on reform and innovation, and constantly upgrading the wide range of our industries. We should further expand opening-up at a high level. We should take the initiative to lower import tariffs. Last year, the overall tariff level was lowered to 7.5%, and there will be a further cut this year. We need to further optimize the business environment, reduce the negative list, and promote stable development of foreign investment and foreign trade. Thanks.

Now TV (Hong Kong):

The GDP growth rate of the second quarter dropped 0.2 percentage point from the first quarter. How much was this due to the trade war? Will the figure continue to decline in the second half this year for the same reason? Thank you.

Mao Shengyong:

Thank you for the question. The economic growth rate of the first half this year was 6.3%. On a quarterly basis, it dropped slightly by 0.2 percentage point. I have mentioned that the world economy overall has slowed down in terms of development, and our external environment has become more complex. At the same time, we have continued to focus on structural adjustment and upgrading. In this context, when analyzing the overall economic performance, we should see if our economic performance has remained within a reasonable range. Currently, despite a slight slowdown in the growth rate, the major economic indices have all remained in a reasonable range and can meet our expectations. 

In the next period, despite possible changes in the external environment, we will focus on our own affairs, striving to keep the economic performance within a reasonable range and striving for high-quality development. Thank you.

Shou Xiaoli:

Thank you, Mr. Mao. Thank you everyone. That ends today’s press conference. See you all next time.

Read in Chinese

Speakers:

Ma Xingrui, vice secretary of the CPC Guangdong Provincial Committee, governor of Guangdong province;

Fu Hua, member of the Standing Committee of the CPC Guangdong Provincial Committee, head of the Publicity Department of Guangdong province;

Zhang Hu, vice governor of Guangdong province;

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office of China

Date:

June 3, 2019

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference. This is one of a series of press conferences for provinces, autonomous regions and municipalities directly under the central government that mark the 70th anniversary of the founding of the People's Republic of China. 

Present at this press conference are: Mr. Ma Xingrui, vice secretary of the Communist Party of China (CPC) Guangdong Provincial Committee and governor of Guangdong province; Mr. Fu Hua, a member of the Standing Committee of the CPC Guangdong Provincial Committee and head of the Publicity Department of Guangdong province; and Mr. Zhang Hu, vice governor of Guangdong province. They will speak about Guangdong's reform, opening up and innovation-driven development, and answer some of your questions.

Now I'll give the floor to Mr. Ma.

Ma Xingrui:

Friends from the media, ladies, gentlemen, friends, it's a great pleasure to take this opportunity to brief you on Guangdong's development. First of all, on behalf of the provincial Party committee and provincial government, I want to express sincere gratitude to all of you for your long, enthusiastic attention to Guangdong. 

Since the founding of the People's Republic of China 70 years ago, the country has witnessed radical changes, and achieved remarkable success in its development. Guangdong is a typical example of this change. Following are some highlights of Guangdong's development. 

First, economic development has maintained rapid growth. The provincial GDP increased from 2.03 billion yuan in 1949 to 9.7 trillion yuan in 2018, ranking among the top few across China for nearly 30 years. This year, the figure is estimated to exceed 10 trillion yuan. 

Second, provincial financial power has grown stronger. The revenue in the general public budget (in comparable prices) increased from 320 million yuan in 1950 to 1.2 trillion yuan in 2018, making the province the first in China to have a revenue in the general public budget exceeding 1 trillion yuan. 

Third, the province has continued to enhance opening up to the outside world. In 2018, total imports and exports of the province reached 7.16 trillion yuan, accounting for one-fourth of the national total, and ranking first in the nation for 33 years in a row. A total of US$447 billion in foreign investments were utilized, accounting for more than one-fifth of the national total. 

Fourth, a world-class manufacturing center has been established. There are approximately 47,500 industrial enterprises that have annual revenue of 20 million yuan or more from their main business operations. From traditional to advanced manufacturing, such as electronic information, green petrochemicals, automobiles, intelligent home appliances and robots, Guangdong has established a relatively complete and well-supported modern industrial system. The output of the electronic information industry accounted for 34% of the national total. 

Fifth, both rural and urban development have been significantly enhanced. A comprehensive transportation network has taken shape. Guangzhou, Shenzhen and other major cities in the Pearl River Delta have formed a modern city cluster with an urbanization rate that has reached 70.7%. All counties are connected by expressway, and all cities will soon be connected by bullet train.

Sixth, people's livelihoods have improved continuously. The average life expectancy has been extended to 77.2 years. The revenues of urban and rural residents have increased continually and absolute poverty has been eliminated. More than 2.4 million people previously recognized by the provincial government as living in relative poverty have risen out of poverty. 

You may wonder, how Guangdong is able to achieve such success despite having no special natural resources, with no foundation for development initially. Please allow me to share some of my views on this issue. Our achievements should be attributed to our system, political path, and the introduction of reform and opening up policies.

Since the founding of New China in 1949, the establishment of socialism has created the fundamental political conditions and the institutional foundation for achieving all development and progress in China today. Under the strong leadership of the CPC Central Committee, Guangdong has carried out socialist transformation smoothly, promoted socialist advancement vigorously, and established a relatively sound system for economic and social development, laying a solid foundation for the province's progress to come.

The introduction of reform and opening up policies in 1978 marked a new awakening and great revolution of the CPC, which propelled the Party into a great innovation from theory to practice, and boosted a tremendous advancement in promoting Socialism with Chinese characteristics. Comrade Deng Xiaoping, the chief architect of reform and opening up, chose Guangdong as the pioneer in the campaign after careful consideration. He required us to forge ahead despite all difficulties. The forerunners in the province, with Xi Zhongxun, former secretary of the CPC Guangdong Provincial Committee, as their representative, were dauntless in exploration and innovation. Thanks to their efforts, Guangdong started the glorious journey of leapfrog development. 

Under the strong leadership of the CPC Central Committee, the provincial Party committee and provincial government of all sessions have united and led all officials and the general public in Guangdong to establish special economic zones, carry out reform and opening up policies, and promote the development of the market economy. We implemented the central authorities' strategic plan of reform and opening up innovatively, and made great achievements in this area. We have served as a window showing China's progress to the world, as a pilot ground for reform and opening up policies, and as a pacesetter of development in China.

Since the 18th Communist Party of China (CPC) National Congress in 2012, the CPC Central Committee with Comrade Xi Jinping at its core has demonstrated tremendous political courage and a powerful sense of mission. It has united and led all Party members and all the Chinese people of all ethnic groups in applying a new vision of development, implementing the five-sphere integrated plan and the four-pronged comprehensive strategy. With this, it has prompted historic shifts and achievements in the cause of the Party and the country, and steered socialism with Chinese characteristics into a new era.

Attaching great importance to the development of Guangdong province, General Secretary Xi Jinping visited Guangdong in his first inspection trip outside Beijing after the 18th CPC National Congress. He has joined deputies from Guangdong in panel discussions during two sessions of the National People's Congress, paid two visits to Guangdong, attended the signing ceremony of the framework agreement on the development of the Guangdong-Hong Kong-Macao Greater Bay Area and the opening ceremony of the Hong Kong-Zhuhai-Macao Bridge. He has delivered important speeches and gave important instructions on the development of Guangdong, designating it as a leading province in four areas (building institutions for high-quality economic development, developing a modern economy, pursuing opening up on all fronts and creating a social governance model based on collaboration, participation, and common interests), and a window for China to showcase its achievements in reform and opening-up as well as for the international community to observe the progress of the endeavor.

With General Secretary Xi Jinping's requirements in mind, we embarked on a new journey of the reform and opening-up drive, striving to break new ground in the new era. 

First, we made sweeping efforts to strengthen Party leadership and Party building, taking a clear political stand and fostering a healthy political atmosphere of integrity. We worked to ensure that all the officials in Guangdong keep in mind the need to maintain political integrity, think in big-picture terms, follow the leadership core, keep aligned, strengthen our confidence in the path, theory, system, and culture of socialism with Chinese characteristics, resolutely uphold General Secretary Xi Jinping's core position in 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.

Second, we took comprehensive steps to deepen reform and opening-up, improve the socialist market economy, enable the government to play a better role and create a more favorable business environment.

Third, the building of the Guangdong-Hong Kong-Macao Greater Bay Area got off to a good start. The development plan is being fully implemented. The Hong Kong-Zhuhai-Macao Bridge and the Guangzhou-Shenzhen-Hong Kong high-speed railway has come into operation. The bay area is attracting an inflow of talent, capital, technology and enterprises.

Fourth, innovation has become an essential force in driving Guangdong's economic growth. In 2018, Guangdong's R&D spending exceeded 250 billion yuan; its PCT (the Patent Cooperation Treaty) applications accounted for about half of the country's total; and the provincial regional innovation capability has maintained its top place nationwide. Guangdong is home to a large number of world-class enterprises, including Huawei, Tencent, Guangzhou Automobile Group, Gree and Midea.

Fifth, Guangdong's economy has been transitioning to a stage of high-quality development and the province has 45,000 national high-tech enterprises. The value-added of advanced manufacturing accounted for 56.4% of the total of industries above the designated size, and the contribution of the tertiary sector to GDP increased to 58.9%.

Sixth, Guangdong has seen a continuous improvement in its ecological environment, with the PM2.5 concentration falling to 31 mcg/m³. The Pearl River Delta has become China's first national forest city group demonstration zone.

Seventh, we have enhanced our ability to meet people's basic needs. Last year, per capita disposable personal income grew to 35,800 yuan. A provincial management system for aged-care insurance funds has been established. There has been steady progress in the efforts to address the key issues affecting living standards, such as offering easier access to medical and government services.

Eighth, we have improved our capacity to forestall and defuse major risks. With the courage and ability to fight, we have ensured social order and stability.

Ma Xingrui:

The world we live in today has been undergoing tremendous changes which are unseen in the past century, and the global economic order is facing unprecedented challenges. Guangdong will fully implement all major policies and plans made by the Central Committee of the Communist Party of China (CPC) with Comrade Xi Jinping at its core, uniting as one, and continuously focusing on managing China's own affairs well to prepare for any difficulties and challenges. With the strong leadership of Comrade Xi Jinping and the Central Committee of the CPC; the solid foundation established since the PRC was founded 70 years ago and the reform and opening up that was initiated 40 years ago, especially since the 18th CPC National Congress; as well as the capability and experience of market entities and with the united effort of the whole nation, we are fully confident in dealing with the various challenges and risks.

Last October, General Secretary Xi Jinping made major policy speeches during his visit to Guangdong province, giving important instructions in four aspects including pursuing deeper reform and greater opening up, promoting high-quality development, encouraging a balanced and coordinated form of development, and strengthening the leading role of the CPC and Party building. Guangdong province has fully implemented and made further progress in the "1+1+9" Plan, in which the two "ones" refer to the political guarantee of strengthening the leading role of CPC and Party building, and the driving force from pursuing deeper reform and greater opening up. The "nine" in the Plan refers to nine key missions, which are the following -- promoting the construction of the Guangdong-Hongkong-Macao Greater Bay Area; implementing the strategy of innovation-driven development; promoting high-quality development; building a modern economic system; laying a good foundation for the "three critical battles" against potential risks, poverty and pollution; implementing a rural revitalization strategy; improving the regional development plan of "One Core, One Belt, and One Region (i.e.to improve the economic structure of the Pearl River Delta as the core of the area; to foster new sources of growth in east and west Guangdong province which form a costal economic belt with cities along the Pearl River Delta; and to turn the mountainous region in north Guangdong province into an ecological zone.)"; developing a culturally prosperous province; and establishing a social governance model based on collaboration, participation and common interests. General Secretary Xi Jinping has instructed us to continue to be consistent in our efforts and stressed the significance of the tangible outcomes from these projects. General Secretary Xi Jinping has also noted that Guangdong province is an important window, not only for China to showcase to the world the achievements of our reform and opening up, but also for the international society to observe the process of our endeavor. The crucial status has placed Guangdong province under the spotlight, especially in the following aspects:

First, we take the building of the Guangdong-Hong Kong-Macao Greater Bay Area as the guiding principle for Guangdong's reform and opening up in the new era, and will dedicate all of our province's strength to work on it.

We join hands with Hong Kong and Macao to build a world-class city cluster and an international-level bay area, promote the joint pursuit of the Belt and Road Initiative, and bolster the leading role of Guangdong to create a new pattern of high-level comprehensive opening up to the outside world. We place top priority on our work to promote the consistency of rules and regulations among the three places. Under the principle of "one country, two systems," we enact flexible measures in line with local conditions, align our business environment with a high-standard of international economic and trade rules, and promote the smooth flow of people, goods, funds and information between the Greater Bay Area. It can be said that Guangdong in the Greater Bay Area is worth looking forward to.

Second, we focus on promoting innovation-driven development.

We resolutely and calmly respond to challenges and tests of any kind, and we have strengthened our capacity for self-reliance and independent innovation. While aiming to increase core competitiveness, core technologies for key fields and basic research, we will invest more in scientific and technological innovation, and concentrate our efforts to improve the regional technological innovation system with enterprises playing a leading role. At the same time, we will speed up the adjustment of industrial structures and promote the transition of Guangdong from a manufacturing-orientated to an innovative province with high-quality development. It can be said that a Guangdong province with high quality development is worth looking forward to.

Third, we pursue a more balanced form of development across the regions as well as the rural and urban areas.

We will vigorously implement the strategy for rural revitalization, make good strides in the battle against poverty, and pursue coordinated development of Pearl River Delta region, coastal economic belt and mountainous area of North Guangdong.. We will show even greater resolve, make greater efforts, and take more practical measures to support the revitalization of the old revolutionary base areas and the development of areas with concentrations of ethnic minorities. According to the provincial financial plan, in 10 years and over different phases, we will invest 160 billion yuan to strengthen the weak links in rural infrastructure and basic public services, and speed up the improvement of rural life. It can be said that a Guangdong province with coordinated development is worth looking forward to.

Fourth, we pursue the balanced development and mutual reinforcement of material and cultural and ethical progress. 

We have launched activities to enhance cultural and ethical progress in the new era, and promote the building of the system of public cultural services. For example, we will promote the innovative development of the traditional Lingnan culture (a prominent culture in South China), based on the approach of respecting others' cultural characteristics while pursuing their own so as to progress together as the Chinese nation. It can be said that a Guangdong province with cultural prosperity is worth looking forward to as well.

Fifth, we will unswervingly advance the construction of an ecological civilization. We will implement China's new concept for development in an all-encompassing way and put into practice General Secretary Xi Jinping's instruction that "lucid waters and lush mountains are invaluable assets." We will adopt a holistic approach to conservation programs aimed at protecting our mountains, rivers, forests, farmlands, lakes, and grasslands, and apply the most stringent rule of law in this process. We will put in place key measures of protecting the environment, conserving energy, reducing emissions, promoting green development, pursuing a low-carbon and circular economy, and advancing ecological civilization. Our goal is to make Guangdong province a homeland with beautiful mountains, waters and nostalgic memories. An ecologically beautiful Guangdong is worth looking forward to. 

Sixth, we will create a social governance model based on collaboration, participation, and common interests. We will implement the general plan of the rule of law and further make Guangdong a place that is safe and based on the rule of law. We will strengthen social governance and make our business environment more internationalized, convenient and based on the rule of law. We aim to make Guangdong one of China's safest and most stable, fair, and just areas. We will continue to increase the people's sense of gain, happiness and security. A safer and more harmonious Guangdong is worth looking forward to.

On our new journey in the new era, Guangdong will hold high the great banner of socialism with Chinese characteristics, rally even closer around the Central Committee with Xi Jinping at its core, follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and fully implement the spirit of General Secretary Xi Jinping's speeches and instructions on Guangdong. We will remain true to our original aspirations and keep our mission firmly in mind. We will continue our hard work, forge ahead, and write a new chapter in the new era of Guangdong's reform and opening up. We will strive to meet the requirement for Guangdong to become a national leader in four areas – establish institutions favorable for high-quality economic development, build a modern economic system, break new ground in pursuing the opening up on all fronts, and create a social governance model based on collaboration, participation, and common interests. Guangdong will also serve as two important windows – a window to showcase China's achievements in its reform and opening-up to the world and a window for the international community to observe China's reform and opening-up. By doing this, we will make our contributions to helping realize the Chinese Dream of national rejuvenation.

Thank you again, friends from the press. Thank you for attending today's press conference. Now my colleagues and I will begin to take your questions.

Hu Kaihong:

Thank you, Mr. Ma. Now we open the floor to questions. Please identify your media organization before raising your question. 

CCTV:

Society has placed a great deal of attention and expectation toward the construction of the Guangdong-Hong Kong-Macao Greater Bay Area. So how Guangdong will take the opportunity of building the Greater Bay Area to advance its reform and opening-up? Thanks.

Ma Xingrui:

Thanks for the question. Indeed, people are very concerned about this effort. The Greater Bay Area has been planned, deployed and promoted by General Secretary Xi Jinping himself as a significant strategy of national importance. Xi personally witnessed the signing of the Greater Bay Area framework agreement and clearly pointed out that Guangdong should mobilize resources from the whole province to promote the construction of the Greater Bay Area, and it is an important historic opportunity for Guangdong to renew its efforts in reform and opening-up. It is expected that Guangdong, Hong Kong and Macao can make concerted efforts to turn the Greater Bay Area into a world-class city cluster and a first class bay area, which can rival the New York Bay Area, the San Francisco Bay Area, and the Tokyo Bay Area, so as to further improve Guangdong's competitiveness and help realize high-quality development.

The Party Central Committee and the State Council unveiled the Outline Development Plan of the Guangdong-Hong Kong-Macao Greater Bay Area on Feb. 18, which clarifies the Greater Bay Area's five identities — a vigorous world-class urban agglomeration, an international science and technology innovation center with global influence, an important support for the construction of the Belt and Road, a demonstration zone for in-depth cooperation between the mainland and Hong Kong and Macao, and a world-class city cluster that promotes a high quality of life, where people can live, work and travel happily. 

Under the leadership of the Party Central Committee and the State Council, Guangdong has formed a close cooperation model with Hong Kong and Macao. We deeply feel that the reform and opening-up since 1978 has brought great changes to Guangdong, and the construction of the Greater Bay Area presents Guangdong with another important opportunity to carry on its reform and opening-up. Our work will be carried forward in the following five aspects. 

First, the business environment will be improved through interlinked rules. We will adhere to the principle of "one country" and make good use of the benefits of "two systems" to interlink the rules in the market economy system, and pave the way for the linkage of various factors. The objective is to ensure that personnel, logistics, capital and information can flow efficiently and orderly. There is still huge potential in this aspect.

Second, the construction of the Greater Bay Area into an international science and technology innovation center will be expedited. This is a key task that people are deeply concerned about.  The Tokyo Bay Area, the New York Bay Area and the San Francisco Bay Area are stronger than the Greater Bay Area in terms of original innovation. This is also our shortcoming. But we have the foundation that has been laid over the past 40 years' of reform and opening-up and over the past 70 years of the New China's development. Hong Kong and Macao have several world-class universities, and if combined with the innovation ability of Guangdong's real economy, they can effectively boost the construction of the international science and technology innovation center. In particular, all relevant departments of the central government attach great importance to the job, such as the building of major scientific and technological infrastructure, large scientific installations, national key laboratories, and national laboratories, etc. In addition, there are also certain favorable tax policies customized for science and technology staff. For example, we are working to make it possible that talents from Hong Kong and Macao can be taxed according to Hong Kong and Macao tax policies in Guangdong. In a word, scientific and technological innovation is a major task for us.

Third, the Greater Bay Area should be built into an important support structure for the construction of the Belt and Road. It is known that the three places have their respective advantages. Hong Kong is an international center of finance, trade and shipping. Macao is a world tourism and leisure center, and has a link with Portuguese-speaking countries. Guangdong is a manufacturing powerhouse and a major province in international trade. So, in the construction of the Belt and Road, the Greater Bay Area can play a very important role.  

Fourth, infrastructure facility interconnectivity will be promoted. As we know, the Guangzhou-Shenzhen-Hong Kong high-speed train service opened last year, which implements the system of "one place and two inspections." It takes only 47 minutes to travel from Hong Kong to Guangzhou by train, while before its opening, we took more than four hours by car. There are also some key infrastructure facilities under construction, such as the Liantang/Heung Yuen Wai Boundary Control Point, and a new port connecting Macao and Zhuhai, both of which will be completed before the end of this year. In particular, we are advancing the coordinated development of high-speed railway, harbors and airport clusters in the region. There are three major airports — Hong Kong Airport, Guangzhou Baiyun International Airport and Shenzhen Baoan Airport, which handle more than 70 million, nearly 70 million and over 45 million passenger trips a year respectively.  

Fifth, an environment with a high quality of life where people can live, work and travel happily will be created. Guangdong will provide sound environment for the youth from Hong Kong and Macao to pursue innovation and start new businesses. Meanwhile, we will also make great efforts to improve the ecological and living environment, since there is still room for improvement in these aspects.

As for information on the Greater Bay Area, you must already be familiar with it as the media has reported widely on it. Due to the tight schedule, I would like to stop here. Thanks.

China Daily:

We learned that the GDP of Guangdong province is expected to surpass 10 trillion yuan in 2019. So my question is what achievements has Guangdong made in promoting high-quality economic development and building a modern economic system, especially in the layout of emerging industries? Thanks.

Ma Xingrui:

Thanks for your question. The GDP of Guangdong province has ranked first in the country for 30 years in a row. As you mentioned, this year it will hit 10 trillion yuan. But for Guangdong, there still remains problems in achieving high-quality development.

First, it must be reflected in the economic system. Since the 18th National Congress of the CPC, General Secretary Xi Jinping has visited Guangdong twice and attended the plenary sessions of the Guangdong NPC delegation twice. He made a series of important instructions, clearly requiring Guangdong to play a leading role in building the system and mechanism to promote high-quality development and a modern economic system. Currently, we should ensure that the market plays its decisive role in resource allocation, and we should give better play to the role of the government, which were also clearly pointed out at the third plenary session of the 18th Central Committee of the CPC. In accordance with the requirements of the Party Central Committee, we are deepening the supply-side structural reform. In this respect, the government is to provide an institutional environment of rule of law and with preferential policies for companies, especially for the real economy. In recent years, we published a series of policies in support of the real economy, private economy, foreign trade, and employment as well. For example, Guangdong took the lead in overall planning of  pension for employees working for local enterprises, bringing benefits to companies and people.

Second, we must focus on developing market players. Guangdong is now home to 11.46 million individual business and companies, with nearly 5 million companies among them, ranking it first in China. Currently, a total of 12 companies in Guangdong have entered the Fortune Global 500 list and the revenue from the main business operations of 29 companies has exceeded 100 billion yuan. So I think all of these are very important. Meanwhile, to develop the market economy, we must focus on developing industrial clusters. Now we already have two industrial clusters which have a total output value of more than one trillion yuan and are engaged in electronic information and green petrochemical. We also have seven emerging industrial clusters with an output value of over 100 billion yuan respectively. There are many examples like these.

First, we took the lead in pushing the development of the 4K UHD (ultrahigh definition) video industry. In the past, we had 1K and 2K, and now we have 4K, bringing many benefits to technology, industries and the lives of people. Now the output of 4K TV accounts for about half of the country. 

Second, we are sparing no effort to develop the robotics industry. Now around 20% of  industrial robots are made in Guangdong. In 2018, the total output of industrial robots reached 32,000 sets, accounting for 22% of the total. In the first quarter of 2019, the output of Topstar Technology Co., Ltd, one of the tech companies that produces industrial robots in Guangdong, generated a year-on-year growth of 36%, maintaining a good momentum. 

Third, we support the new energy automobile industry. I used to work in Shenzhen where we worked to ensure that all buses were powered by electricity within three years. This was also realized in Guangzhou and Zhuhai, which promotes the development of new energy automobiles. The emission of a bus that fueled by diesel is equivalent to that of 40 cars. So the development of new energy automobiles will help to improve the air quality. You can take a look in Shenzhen and Guangzhou, there are now many changes.

Fourth, we promote the development of the industrial internet. Guangdong is a province that based on information. We encourage companies to improve themselves with the help of information technology, especially that of the industrial internet. A total of 3,000 companies now have access to the cloud platform, and that number will reach 10,000 in the future. 

Fifth, we are making efforts to develop the mobile communication industry. The output of smartphones now accounts for 43.9 % of the total output in the country. Most of the mobile phone brands, like Huawei, OPPO, VIVO and Apple, have established their production lines in Guangdong. In addition, we are stepping up the building of the 5G network. This year, we will set up base stations for the commercial use of 5G in Shenzhen.

Generally speaking, high-quality development is the key to building a modern economic system. We also need to give full play to the market and government. In addition, we need to target strategic emerging industries and future industries like artificial intelligence.

Phoenix Satellite TV:

I have two questions. First, what measures will Guangdong take to jointly promote cultural development in the Guangdong-Hong Kong-Macao Greater Bay Area, which is stressed in the area's development plan? Second, as you just said, Guangdong is fully confident in its ability to develop its economy and cope with its challenges. How much impact does the economic and trade friction between China and the United States have on Guangdong, since there are many high-technology enterprises in the province? What measures have you taken to ease the impact? Thank you.

Ma Xingrui:

Now Mr. Fu Hua will answer your questions. He is a member of the Standing Committee of the CPC Guangdong Provincial Committee and head of the Publicity Department of Guangdong province. He is in charge of related works.

Fu Hua: 

Jointly promoting cultural development in the Guangdong-Hong Kong-Macao Greater Bay Area is a significant part of the area's development. As you know, Guangdong, Hong Kong and Macao share the same culture, making it easy to promote cultural development in the area. Besides, over the past 40 years of reform and opening-up, the three regions have enjoyed increasingly close and active cultural exchanges. These have laid the foundation for jointly promoting cultural development and spreading cultural values in the bay area.

According to the requirements of the Development plan for the Guangdong-Hong Kong-Macao Greater Bay Area, certain arrangements and considerations have been made by Guangdong province in jointly building a cultural Bay Area. Not long ago, we published a Three-year Plan of Guangdong province to establish a circle of culture in the Greater Bay Area. We will be carrying out certain preliminary policies from 2019 to 2022 based on the following three aspects. First, as the shared wealth and the cultural basis of Guangdong, Hong Kong and Macao, Lingnan culture should be treated as a bridge to carry forward China's fine traditions and to promote its innovative transformation and development. Second, the rich cultural resources in the Bay Area will be fully utilized, and the rich cultural products of the new era should be put forward. Third, Guangdong, Hong Kong and Macao should focus on cultural communication by presenting the story of China and its Bay Area in a more compelling way. 

In terms of specific works concerned, our vision is as follows:

First is to promote the development of a culturally prosperous province. The cultural capacity of Guangdong needs to be further developed in order to collaboratively build a cultural Bay Area. With the initiative of the Party committee and the government of Guangdong province, a Three-year Plan to develop the cultural prosperity of Guangdong has been created, which consists of 10 key programs and 50 projects, including the inheritance and innovation of Lingnan culture, the promotion of the high-quality development of the cultural industry in Guangdong, and the endeavor to elevate the culture and arts of Guangdong to a new level in the new era. Among all the fine arts of Guangdong, it is necessary for the excellences to stand out to present the essentials of the new era.

Second is to deepen cultural exchange and cooperation, which is of great significance. So far, our concerns have been mainly focused on five aspects as follows. First, we will co-host the cultural festival of the Greater Bay Area, organizing public galas and events to promote Lingnan culture, notably the Cantonese opera, dragon boat, martial arts and Guangdong lion dance. Second, we will work with Hong Kong and Macao to protect our cultural heritage and to raise people's awareness in this regard. Third, we will promote the in-depth integration of our cultural industry into tourism, by innovating on the industrial chain and developing a world-class resort in the Bay Area. Fourth, we will collaboratively work to improve the cultural and creative industries. As over 300 industrial parks in these fields are in Guangdong province, the cultural and creative industries have room to thrive in the Bay Area. Finally, we will build the Alliance for Art and Culture of the Greater Bay Area in order to promote the collaboration of Guangdong, Hong Kong and Macao in producing films, TV series, literature, music and artworks to present the development of the Bay Area. More cultural icons with characteristics of the Bay Area should be created.

Third is to provide more support for, and to create a better environment in the area of public opinion on the development of the Greater Bay Area. We are aware that on May 19, the first Media Summit of the Guangdong-Hong Kong-Macao Greater Bay Area was organized in Guangdong province. The summit was a success, and over 110 media outlets from Guangdong, Beijing and Taiwan covered the summit, which was attended by a total of more than 600 media professionals and guests. During this one-day event and three days of interviews, we achieved a lot. This can be seen not only in the over 3,000 original news reports on the development of the Bay Area, but also in the consensus among many media outlets on how to present the first-class Bay Area. In this regard, we will work hard to make further progress in the gathering of media resources. Because the Greater Bay Area is a new area of growth, it will surely be under the spotlight. We hope that media around the world will pay more attention to the construction of the Greater Bay Area, thereby attracting more resources for its development in order to jointly contribute to an environment with first-class media and public opinion. Thank you.

Ma Xingrui:

Just now, Mr. Fu answered your first question. In order to create a strong cultured province, I think another point is also important - that is that advanced culture needs to be promoted by advanced technology. In my opinion, the cultural industry or cultural undertakings not only provide us with nourishment for our mind, but also stimulate technological development. Next, we are planning to popularize 4K, 8K and 5G, which will surely bring huge benefits to cultural communication. Therefore, the cultural industry has great demands and significant driving forces for technology.

I would like to answer the second question briefly. Recently, the trade friction between China and the U.S. has become an extremely important international issue. Yesterday, the State Council Information Office (SCIO) of China published a white paper clearly indicating China's stance on trade consultations. It said that the trade friction is provoked unilaterally by the U.S. and is not in line with related international rules. The continuous escalation of  trade friction is not only detrimental to economic and social development, enterprises and people on both sides, but is also harmful to the world's economy. Guangdong is a big province in regard to international business and economics, because we account for about one fifth of the total trade value between China and the U.S. Currently, enterprises and the market economy in Guangdong still have relatively high economic vitality. Tested by the 2008 international financial crisis, they have become more resilient and are better equipped to resist risks and support economic development. Guangdong has paid much attention to intellectual property (IP) protection, we have IP courts and established a standardized IP trading system. In addition, we have a bunch of enterprises that demonstrate a strong ability to innovate, such as Huawei which is a world leader in cutting edge 5G technology. Trade friction between China and the U.S. does have some effect on Guangdong, but it's generally within control. Thank you.

CGTN:

Guangdong regards digital government as an important driver for reform. It has proposed a series of innovative measures, including launching a government service app Yueshengshi in Guangdong. Could you tell us more about Guangdong's progress in its building of a digital government? Thanks.  

Ma Xingrui:

Thank you for the question. Let me invite Guangdong Vice-Governor Zhang Hu to answer the question.

Zhang Hu:

Thank you for your concern on Guangdong's digital reform and construction. President Xi Jinping pays great attention to applying information technology in state governance. He has emphasized many times the role of information technology in the state governance, and that promoting the modernization of the state governance system and governance capability by the use of information technology, so as to better serve the country's economic and social development and improve people's livelihoods. 

Guangdong's building of a "digital government" is an important deployment of General Secretary Xi's important instructions and spirit in this regard. It is significant for the province to foster an "internet plus government services", modernize the government's governance system and governance capability as well as playing up and creating new strengths in the business environment. After more than two years' work, the reform and construction of our "digital government" has achieved remarkable results. In April, the General Office of the State Council's e-governance office entrusted third party agencies to assess the online government service capabilities of provincial-level governments. Guangdong was ranked first in the assessment. I would like to introduce it through the following three aspects:

First, why this reform? Guangdong has always placed great significance to the informatization of governance and has launched government service applications with Guangdong characteristics. But in the light of the new situation and new requirements, we still have four prominent issues to resolve. Firstly, the construction and management mechanism lags behind. There is no department directly affiliated to the provincial government to lead and plan the deeper integration of informatization within the provincial-level government. There is also insufficient coordination and collaboration among the relevant governments at the city- and county-level. There is no vertical planning and collaboration so synergy is lacking between the superior and subordinate departments, and among different departments in one place that are related to the undertaking. Second, sporadic and repetitive construction is common. Before the reform, every department directly affiliated to the provincial government had its own information center, and there were as many as 1,068 such information systems, which were separated from each other. This led to the existence of many isolated information islands. Third, the services for enterprises and people are not in place. Because the data resources of different units are separate, and there was no unified management and effective sharing, the people and business owners often complained that they had to go to different departments and repeatedly provide certification materials to deal even with a simple matter related to the government. Fourth, the staff are not professional enough. The professional structure of talents on the informatization in government departments is comparatively basic. Statistics show the proportion of talents in the middle- and high-level professional ranks is not high, which does not match with Guangdong's status as a major province of the information industry.  

Secondly, how do we advance this reform? In response to the aforementioned prominent issues, the CPC Guangdong provincial committee and the Guangdong provincial government initiated the "digital government" reform. At the end of 2017, it was labeled as the first of the 18 key tasks for Guangdong's deepening of reforms. Guangdong Party chief Li Xi presided over the work conference to examine and settle on the final reform plan, and made detailed deployments. Guangdong Governor Ma Xingrui held the post as the leader of the team to deepen reform, and has conducted inspections many times to create the master plan and the construction plan to advance the reform. Our efforts are mainly in these four aspects:  

First, we have deepened institutional reforms. Governance service data administrative bureaus were established at the governments of the province, city and county level, which form a coordinated informatization administrative body connecting the superior and subordinate government bodies. The functions such as local office of government set-up committee's responsibilities in promoting the administrative approval system reform, the development and reform commission's duties in initiating and approving projects related to informatization, and the supervision of public resource trading platforms are now assigned to the government data service bureaus, so that a vertical and intensive management system that features the integration of technology and operations is formed. 

Second, we have established a model featuring the "collaboration of government and enterprises, and division of administration and operations". We have integrated the resources of Tencent, China Mobile, China Unicom and China Telecom and founded the Digital Guangdong, which is in charge of the building, operation and maintenance of the "digital government". We have brought together a group of talents in big data, networks, operations and development and resolved the shortage of talent and the rigidity of the government system in starting a business. 

Third, we have strengthened the platform's role as a powerful support and efficient service provider. Building a unified government cloud and big data platform, promoting inter-department and cross-level data sharing, and reinforcing the foundation for a digital government. Based on this foundation, we have advanced the platform's applications in three aspects — Yueshengshi app, Guangdong governance service website (gdzwfw.gov.cn), and coordinated office platform, in a bid to realize "the 'clouding' of data and the delivering of services".

Fourth, we place greater emphasis on the role of think tanks. A "digital government" reform and construction expert board was set up. We invited Wang Qinmin, who is the former vice chairman of the National Committee of the Chinese People's Political Consultative Conference, and director of the State Council's e-governance expert committee, to head the board, which consists of more than 100 experts and provides strong technological support in the construction of "digital government" for Guangdong.

Third, how about the effect of the reform? The Yueshengshi app has made it possible for users to deal with 630 government-linked issues relating to their everyday lives through their smartphone. For 86% of these issues, people now do not need to go to government departments in person, saving them considerable time and costs. For example, the photos people needed to take at the border exit-entry is now free of charge, which saves people's time, and nearly 100 million yuan ($14.49 million) a year. In the first year of the app's launch, more than 12 million people have logged on it. In terms of services for enterprises, the Guangdong governance service website has covered all service items related to governments at the village, township, county, city and provincial levels. This has greatly enhanced the working efficiency and reduced the amounts of materials enterprises have to submit by nearly 56%, according to our statistics, and reduced the amount of the time for registering a new business to five days at most. In addition, in terms of government coordination, the integrated collaborative office platform has been promoted for use in 21 cities in the province, as well as 42 departments directly affiliated to the provincial government, among which more than 90% has initiated cloud-based work platforms. Our survey indicates the time for handling department documents has dropped by about 40%, and the efficiency of administrative approval and services have markedly improved.

Currently, Guangdong has entered a key phase in its "digital government" reform and construction. Although we have made some progress, there are still many more tasks to be done. We will act strictly according to the CPC Central Committee and the State Council's deployment and requirements, learn the good experience and working methods from other provinces, and unswervingly deepen reform and seek innovation — like hitting the nail on the head — to take Guangdong's "digital government" reform and construction to another level. That's all I have to say about the topic. Thanks.

Ma Xingrui:

As for the "digital government", I would like to say more. First, it is important for us to implement the deployment of the "Digital China", as it represents the direction for guiding and pushing forward the development of the digital economy. Second, we need to build a public cloud platform and public data platform, breaking the former state in government work in which there was a lack of coordination among different departments. Third, we founded Digital Guangdong, a network construction company employing 1,200 people, which is a joint venture involving Tencent, China Mobile, China Telecom and China Unicom and operating according to market laws. Meanwhile, we founded a governance service data administrative bureau, which is indeed a tough institutional breakthrough. That's all. 

South China Morning Post:

I have two questions about the China-U.S. trade friction. First, what specific measures will Guangdong take to cushion the impact of the U.S. moves? You said the provincial government had introduced some important measures to meet the economic challenges that emerged in 2008. What measures has the government taken or plans to take to hedge against the impact of the current trade friction? Second, Guangdong plays a key role in promoting innovation, and you said the province plays a leading role in the innovation-driven development of the Guangdong-Hong Kong-Macao Greater Bay Area. So, what impact will the trade friction exert on Guangdong’s role as an innovation driver for the Greater Bay Area?

Ma Xingrui:

As to your first question, I think we need to let the market play the decisive role in resource allocation, along with the government playing its supervisory role better. 

First, we will pursue greater opening-up in accordance with the requirements of the CPC Central Committee. On several occasions, General Secretary Xi Jinping has stressed that China will broaden its opening-up. The occasions include the Boao Forum for Asia, the first China International Import Expo and the second Belt and Road Forum on International Cooperation. Guangdong, as an important window for China's opening-up and construction of the Greater Bay Area, must take more resolute measures to ensure broader opening-up. 

Second, we will further relax controls on market access, act to promote the foreign investment law passed at the second session of the 13th National People's Congress this year and implement an across-the-board management system based on pre-establishment national treatment and requirements of the negative list. We have also introduced a series of other measures to ensure stability of our foreign trade and better utilization of foreign investment. 

Third, we will continue to expand the overseas market. Last year, Guangdong, Hong Kong and Macao jointly hosted a promotional event in Paris, which was attended by some 600 to 700 companies. This year's promotion in Tokyo was larger, drawing more than 1,200 participants. Lam Cheng Yuet-ngor, chief executive of the Hong Kong Special Administrative Region (SAR), Chui Sai On, chief executive of the Macao SAR and myself attended the event. We have been organizing such events since we became fully aware that, in the age of economic globalization, no country can achieve development if its door is closed to the outside world. Judging by the current situation, foreign trade in Guangdong is steady.

Regarding your second question: First, speaking from both long-term and current perspectives, Chinese technological development must be achieved by self-reliant innovation. Of course, self-reliance doesn't mean cutting ourselves off from the rest of the world. The U.S. has no legitimate grounds for placing Huawei on its Entity List. For many years, Guangdong has been strengthening the role of enterprises in innovation, and we have made solid progress that is demonstrated by at least four figures of "90%" coming from enterprises, namely the percentage of R&D investment, the percentage of R&D personnel, the percentage of R&D institutes and the percentage of patent applications and approvals. Guangdong was ranked first in the comprehensive capacity of regional innovation among Chinese provinces in both 2017 and 2018.

Second, weak points affecting Guangdong's innovation capacity lie in basic research and application-oriented basic research. We have increased our efforts to develop platforms for technological innovation and promoted the establishment of several key scientific facilities, national and key laboratories. We have founded a provincial foundation for basic research and application-oriented basic research. We have also promoted technological breakthroughs in nine key areas (rail transit equipment, high-end vessels and ocean engineering equipment, smart robots, smart vehicles, sophisticated modern agricultural machinery, high-end medical appliances, new materials, smart manufacturing, and major technical equipment). Unremitting efforts are required for further progress.

Third, we have been focusing on providing a relaxed development environment for talent. So far, we have attracted a number of academicians and experts, innovation groups and entrepreneurial teams to Guangdong, and we also encourage enterprises to promote global allocation of technological resources.

Fourth, we attach great importance to intellectual property protection. Priority should be given to promoting the transfer and trade of technological outputs. The annual trade volume of technical contracts in Guangdong province has now reached more than 100 billion yuan.

Firth, we have made continuous efforts to improve Guangdong's ecosystem for innovation. This requires persistent efforts that cannot be achieved overnight. So, we encourage experts and academics to concentrate on their research rather than seeking fame and wealth. We are working to create an enabling environment in which failure is tolerated and exploration is constantly encouraged particularly in basic research. At the same time, we will always take resolute disciplinary action against academic misconduct. Thank you.

Economic Daily:

The uneven development between urban and rural areas and between various regions in Guangzhou has always been a challenge for the province. Last year, General Secretary Xi Jinping made requirements for Guangdong during his visit to the province. To address the challenge, what measures have been taken and how do they work? Thank you. 

Ma Xingrui:

Thank you for your question. The most daunting challenges facing Guangdong are the uneven development between regions and the urban-rural dual structure. Since the 18th National Congress of the CPC, General Secretary Xi Jinping has set very clear requirements for Guangdong's integrated development for multiple times. Especially during his visit from Oct. 22 to 25 last year, Xi asked us to take efforts to resolve the urban-rural dual structure, narrow the gap between the Pearl River Delta and the region of south Guangdong, west Guangdong and north Guangdong, and push for balanced and coordinated development. Those three areas occupy 70% of the land in the province, but account for only 20% of the provincial GDP, while the remaining 80% goes to the Pearl River Delta. Uneven development has been a longstanding issue. Guangdong still has a huge gap between urban and rural areas, as the ratio of rural income to urban income stands at 1:2.58. As a result, we will work hard to resolve the two issues.

Regional coordinated development means further focusing on relative strategies. The provincial government designed the new development pattern of "One Core, One Belt and One Region," —the Pearl River Delta as "One Core," the coastal economic belt as "One Belt," and the ecological development zone in north Guangdong as "One Region." Regional coordinated development also means we will increase support for east Guangdong, west Guangdong and north Guangdong. For example, we will advance the construction of the high-speed transit connecting the Pearl River Delta with the three parts of Guangdong, as well as a high-speed railway. We will also facilitate the construction of airports in Zhanjiang, Jieyang and Shaoguan. We are funneling more S&T resources to those three areas of Guangdong, and supporting their development of basic public services, including medical care, employment and education. On July 1, 2017, Guangdong was the first province to implement a coordinated basic pension system for employees. We will build 30 top-notch hospitals in the province, and now there are already 22 such hospitals, among which five are in the three core areas. The provincial government has invested 50 billion yuan in building a community-level medical service system. We will develop various education especially professional education. Moreover, we are optimizing the industrial structure. For instance, Zhanjiang and Jieyang are introducing a number of investment projects each worth tens of billions of yuan. 

As for urban-rural development, we will roll out policies and mechanisms to address the unevenness. We will stick to the principle that "urban areas support rural development, and industry promotes agriculture." The province will invest 160 billion yuan over the next 10 years to reshape the rural areas. We will do a good job to offset cultivated land used for other purposes, ink the amount of urban and rural land designated for construction to that of land returned to cultivation, and put returns from the land trade in the fund used to develop rural areas. We will push forward demolition and reclamation projects in rural areas. We are making efforts to advance industrial revival. We have built 150 modern provincial agriculture industrial parks, each granted 50 million yuan in subsidies to develop special agriculture and help raise the income of farmers. We will work hard to improve living conditions in urban and rural areas. We are confident that there will be significant progress within three years, huge achievements within five years, and fundamental changes within 10 years. Thank you. 

Hu Kaihong:

Due to the time limit, the last question will be for journalists. 

Hong Kong Economic Herald: 

Hong Kong youth entrepreneurship on the mainland has progressed to the version 2.0 under the background of the Greater Bay Area. What will Guangdong do to take forward the development of youth entrepreneurship and employment bases for Hong Kong and Macao? Thank you.

Ma Xingrui:

Thank you for your question. I have never heard of the version you mention. However, I can give you a brief introduction of the relevant work. First, during the development of the Guangdong-Hong Kong-Macao Greater Bay Area, the CPC Guangdong Provincial Committee and Guangdong provincial government have always sought to meet the requirements of the central leadership in ways suiting the needs of Hong Kong and Macao, proactively promote the development of youth entrepreneurship and employment bases and provide services for the youth of Hong Kong and Macao. The Greater Bay Area consists of the Hong Kong Special Administrative Region (HKSAR), the Macao Special Administrative Region (Macao SAR) as well as the municipalities of Guangzhou, Shenzhen, Zhuhai, Foshan, Huizhou, Dongguan, Zhongshan, Jiangmen and Zhaoqing in Guangdong Province (known as the "nine Pearl River Delta municipalities"), covering a total area of 56,000 square kilometers and with a combined population of approximately 70 million. Their combined gross domestic product (GDP) has been around $1.6 trillion. In recent years, we have established the Shenzhen-Hong Kong Science and Technology Innovation Special Cooperation Zone in Qianhai of Shenzhen, attracting a large number of young people from Hong Kong to take up innovation as well as entrepreneurship in Guangdong with great success. Now, all the Pearl River Delta municipalities have provided great opportunities to promote youth innovation and entrepreneurship for Hong Kong and Macao. Recently, I attended the Hong Kong-Guangdong Cooperation Joint Conference with Madam Carrie Lam Cheng Yuet-ngor, the fifth-term Chief Executive of the HKSAR, and the Guangdong-Macao Cooperation Joint Conference with Mr. Chui Sai On, the fourth Chief Executive of the Macao SAR. All the relevant work is now well underway and our cooperation has made good progress.

Second, we have been working hard to make it convenient for youth from Hong Kong and Macao to find a job, study and go to hospital here. For example, we have so far helped 100,000 citizens from Hong Kong and Macao to apply for mainland residence permits. In the areas of medical and endowment insurance, local governments from the three [pillars of the Greater Bay Area] vow to strengthen communication and improve relative supporting policies.

Third, we are always striving to provide convenience for youth from Hong Kong and Macao to incubate their scientific and technological achievements. For example, Da-Jiang Innovations (DJI) has grown in strength in Guangdong. At the beginning, the founder of DJI, Wang Tao, and his tutor got the idea in Hong Kong, but they chose Guangdong to incubate their achievement thanks to its highly-qualified manufacturing industry and mature industrial chain. Another example is UBTECH. Its innovative team had spent years trying to find a suitable place to produce robots, and finally chose Guangdong as its headquarters because of the mature industrial chain it offered. I want to say Guangdong's mature industrial chain helps a lot in transforming the innovation achievements of youth from Hong Kong and Macao. Thank you.

Hu Kaihong:

That's the end of the Q&A section. Now I'll give the floor to Mr. Ma for some closing remarks.

Ma Xingrui:

On behalf of the CPC Guangdong Provincial Committee and Guangdong provincial government, I would like to express my sincere gratitude to the SCIO and all media friends for your concern and support of Guangdong in its development. Welcome all of you to visit Guangdong. Thank you.

Hu Kaihong:

This concludes today's press conference. Thank you, Mr. Ma. Thank you, Mr. Fu and Mr. Zhang. Thank you all.

.

Read in Chinese

Speaker:

Wang Shouwen, vice minister of commerce and deputy China international trade representative

Chairperson:

Guo Weimin, vice minister of the State Council Information Office

Date:

June 2, 2019

Guo Weimin:

Ladies, gentlemen, media friends, good morning. Welcome to this press conference.

Today, the State Council Information Office (SCIO) released a white paper entitled "China's Position on the China-U.S. Economic and Trade Consultations." At this press conference, we will brief you about its major content, along necessary explanations.

Present at this press conference is Mr. Wang Shouwen, vice minister of commerce and deputy China international trade representative. I'm your host, Guo Weimin, vice minister of the State Council Information Office.

First of all, let me brief you about the major content of the white paper. The document is entitled "China's Position on the China-U.S. Economic and Trade Consultations." It summarizes and introduces the history of China-U.S. trade friction, and the general situation of the bilateral trade talks. It also explains China's principles and position on the various issues involved. The document contains approximately 8,300 words, and contains three parts - foreword, main content and conclusion.

The white paper notes that trade cooperation remains the ballast and the propeller for China-U.S. relations. This issue is critical to the fundamental interests of the two nations and their people, as well as world prosperity and peace. Since March 2018, in response to the economic and trade friction unilaterally initiated by the United States, China has had to take forceful measures to defend its national interests and its people. At the same time, China has always adhered to the basic principle of resolving disputes through dialogue and consultations, and there have been several rounds of trade negotiations with the United States. China has tried its best to maintain a stable trade relationship with the United States. We certainly don't want to see a trade war occur. However, if it really comes, we won't be afraid, and will fight it if necessary. Our attitude on this has never changed.

The white paper clearly shows how China-U.S. trade friction provoked by the United States has harmed the interests of both countries and, indeed, the world as a whole. The imposition of trade tariffs has done no good to the United States as well as others. It has impeded bilateral trade investment and cooperation. It has also affected market confidence and economic stability worldwide. A trade war won't "make America great again." Instead, it has raised the production costs of American enterprises, increased domestic prices in America, harmed U.S. economic growth and people's livelihood, and obstructed the flow of American exports to China. The trade bullying carried out by the U.S. have had a negative influence on the entire world. They have damaged the multilateral trading system, enormously disturbed the global industrial chain and supply chain, and damaged market confidence. They pose a severe challenge to the recovery of the global economy, and pose a grave threat to advancement of economic globalization.

The white paper noted that in the trade negotiations with China, the United States has gone back on its words, and not acted in good faith. Since the United States provoked the trade friction, bilateral trade and investment have been badly affected. This led to both sides agreeing to sit down and discuss a solution. Since the trade negotiations started in February 2018, significant progress has been made, and consensus has been reached on the majority of issues. However, there were also various twists and turns, all of them caused by the U.S. government, as it has repeatedly abandoned the bilateral consensus, gone back on its words, and broken its promises. The setbacks in our trade negotiations should all be blamed on the U.S. government.

The white paper pointed out that China has always adhered to the principles of equality, mutual benefit and good faith throughout the consultations. It has always believed that the U.S. threat of trade war and the imposition of tariffs won't help solve trade problems. China and the United States should seek solutions through consultations in the spirit of mutual respect, equality, mutual benefit, goodwill and good faith.

The white paper also emphasizes that, in China-U.S. trade consultations, the sovereignty and dignity of each country must be respected. Any agreement must be on an equal basis and be beneficial to both sides. When it concerns major issues of principle, China will never take a step back.

Finally, the white paper stresses that a mutually beneficial, win-win agreement between China and the United Stated conforms to the interests of both countries, and also meet world expectations. We hope that the United States and China can work together and meet each other halfway when managing trade disputes and enhancing trade cooperation, so as to jointly promote the Sino-U.S. relationship on the basis of coordination, cooperation and stability, and to increase the benefits available to the people of the two countries and the world.

The white paper "China's Position on the China-U.S. Economic and Trade Consultations" is available in eight languages, namely: Chinese, English, French, Russian, German, Spanish, Arabic and Japanese. It is published by the People's Publishing House and the Foreign Languages Press, and is distributed by the Xinhua Bookstore across the country.

That's all for my part. Now, let's welcome Mr. Wang Shouwen, vice minister of the Ministry of Commerce, deputy China international trade representative, to provide a detailed briefing.

Wang Shouwen:

Thank you, Mr. Guo. Friends from the press, ladies and gentlemen, good morning. Today, the State Council Information Office issued a white paper titled "China's Position on the China-U.S. Economic and Trade Consultations." Thank you very much for joining us this weekend. Mr. Guo has just provided a brief introduction to the main contents of the white paper, and I would like to add a few more points here.

The international community has paid close attention to the China-U.S. economic and trade consultations, and there are some rumors and speculations. In order to clarify the facts and show China's position on this issue, the Chinese government has compiled a white paper, "China's Position on the China-U.S. Economic and Trade Consultations." The white paper provides a comprehensive picture of the China-U.S. economic and trade consultations and presents China's policy position on these consultations from the perspectives of the impacts of China-U.S. economic and trade frictions, the backtracking of the U.S. on commitments in China-U.S. trade consultations, and China's principle and position on the consultations.

China believes that China and the U.S., the two largest economies in the world, benefit from cooperation and harm each other in disputes. The bilateral economic and trade relations bear on the fundamental interests of the two peoples and the prosperity and stability of the global economy. Since the establishment of diplomatic ties 40 years ago, China and the U.S. have seized the historic opportunities brought by the integration of the global economy and the liberalization of trade and investment, giving full play to the huge complementary advantages of the two economies, and promoting the leapfrog and diversified development of bilateral economic and trade cooperation from scratch. The value of bilateral trade in goods was only $2.5 billion when the two countries established diplomatic ties. Last year, bilateral trade in goods reached $633.5 billion, an increase of 252 times. The volume of bilateral trade in services reached $125 billion, and the two-way direct investment approached $160 billion. It can be said that China and the U.S. witnessed an economic and trade cooperation that has never been broader or deeper as today, and the two economies have become more closely linked, which not only brings tangible benefits to the two countries and the two peoples, but also contributes to the prosperity and stability of global economy.

Certainly, it is inevitable that there are some differences and frictions in the economic and trade cooperation because the two countries are in different stages of economic development and have adopted different economic systems. This is normal in our view and requires both sides to solve problems, resolve disputes, expand consensus, and narrow differences through dialogues and consultations while adopting a rational and cooperative attitude, so as to push bilateral economic and trade relations along the track of cooperation.

Since it took office, the current U.S. administration has frequently provoked economic and trade frictions with trade deficits and intellectual property rights as excuses, and imposed unilateral tariffs on China, regardless of the interests of China, the U.S. and even the world, or the nature of the mutually beneficial cooperation between China and the U.S. in economic and trade fields. China has to take effective measures to safeguard the interests of the country and its people. Meanwhile, China has always insisted on resolving disputes through dialogues and consultations and has conducted several rounds of economic and trade consultations with the U.S. side, working hard to stabilize bilateral economic and trade relations. China adopts a consistent and clear attitude that we are willing to address the economic and trade differences between the two countries through cooperation and push for a mutually beneficial agreement; however, there are principles for cooperation and a bottom line for consultations, and China will not back down on major issues of principle.

As President Xi Jinping pointed out, cooperation is the only correct choice for China and the United States. China will continue to work earnestly no matter how the situation changes. We would like to see both sides to meet halfway, and narrow differences and strengthen cooperation in the spirit of mutual respect, equality and mutual benefit, in a bid to promote the steady and sound development of the China-U.S. economic and trade relations together and improve the well-being of the people of the two countries and the world at large. Thank you.

Guo Weimin:

Thank you. Now, it's time for questions. Please identify the news organization you represent before asking questions. Simultaneous interpretation service is provided at today's press conference, and if you ask questions in English, we will provide translations on the spot. Let's start.

CCTV:

Question goes to Mr. Wang. Recently senior American officials accused China of "backtracking" that led to the stagnation of the negotiations. What's your comments on that? Sources also said that China deleted some of the draft text of the agreements, which led to the breakdown of the negotiations. Is it true? Thanks.

Wang Shouwen:

Thank you. China has always showed our full sincerity toward the China-U.S. trade talks. It is irresponsible for the U.S. to accuse China of "backtracking" during the consultations. This is mud-slinging. During the consultations, and before reaching an agreement, everything we put on the table is only a discussion; there is no so-called "backtracking" since there is no deal yet. There is a saying on consultations, that "Nothing is agreed until everything is agreed." Last December, China and America's presidents reached an important consensus during their meeting in Argentina that economic and trade frictions will be resolved through consultation, with the ultimate objective of removing all tariffs imposed by the two sides. China is committed to the presidential consensus in the interest of China-U.S. economic and trade relations. China has always kept reasonable, exercised restraint and showed its full sincerity and kindness when responding to the concerns of the United States.

On many issues raised by the U.S. side during the consultations, China has overcome difficulties and come up with practical measures. However, when you give the U.S. an inch, they'll want a yard. The U.S. side insisted on unreasonably lofty requests. They insisted that some requirements that interfere with China's sovereignty should be included in the agreement. They also insisted that all tariffs imposed since the trade frictions started should remain in place. They also put pressure on China by raising the rate of tariffs, leading to the escalation of the bilateral economic and trade friction and the severe setback on the consultation. All of us can tell from the facts which side should be responsible for the current status of the negotiations.

China always stresses that consultations should be based on mutual respect, equality and mutual benefit, and the two sides should meet each other halfway. By saying mutual respect, it means that each party should respect the other's sovereignty and core interests. We hope the U.S. can meet China halfway. With mutual understanding, both sides should compromise, instead of asking only one side to compromise. Equality and mutual benefit means that the two sides are on an equal footing and the results of the consultation should be beneficial to both sides. If one side doesn't respect the other side's sovereignty and core interests and tries to force the other side to compromise, negotiations cannot succeed. It is futile for the U.S. to exercise extreme pressure and other ways to escalate the trade frictions to force China to compromise. Thanks.

Economic Daily:

The U.S. claimed that trade frictions has hurt China more than it has the U.S. What is your point of view on this? Thank you.

Wang Shouwen:

There will be no winners in a trade war. The measure of imposing tariffs taken by the U.S. on Chinese goods has not only affected China, but also taken a toll on the U.S. and the global economy.

I think the results from U.S. research are most convincing and compelling when it comes to assessing the impact of the trade restrictions on the U.S. For instance, the U.S. claims that because the U.S. suffers a huge trade deficit with China, the trade war could help narrow this deficit. The fact of the matter is that U.S. statistics last year showed that the U.S. goods trade deficit rose by 10.4 percent, the U.S. soybeans exports to China plunged by 50 percent, and the U.S. automobile exports to China decreased by more than 20 percent. It shows that the trade sanctions have hurt the interests of the U.S. workers and farmers. The sanctions have also hurt U.S. consumers as well. A report released by the International Monetary Fund found that the tariff revenue collected has been borne almost entirely by U.S. consumers. How much is that? A research by the Federal Reserve Bank of New York showed that every U.S. household has to pay $831 more as a result of the tariffs. The trade friction will also put pressure on U.S. employment. Trade Partnership, an U.S. based think tank, found in its research that if the U.S. increased tariffs on Chinese imported goods, the U.S. would lose 2.23 million jobs. The trade sanctions will hit the U.S. and the world economy as well. The trade friction has disrupted the global value chain, caused chaos in the trade order and dented confidence of investors across the world. A report by the United Nations Conference on Trade and Development found that the global cross-border investment slipped in 2017 and 2018 by a two-digit rate. The trade friction caused by the U.S. has not only harmed consumers' confidence, but also the world economy. Thank you.

Reuters:

I want to ask whether Xi Jinping will meet with Donald Trump at the G20 this month. And should they meet, what sorts of topics, what specific trade issues might they be talking about?

Wang Shouwen:

Thank you for your question. However, I have no information for you on this.

Bloomberg:

It seems to me from what you said today that you blame the U.S. for the breakdown of the talks. What gestures or what kind of statements of sincerity does the U.S. have to do to bring China back to the table? Is the next step, from your perspective, that the U.S. having to make the next move? Or is there some kind of trust building that you could go through? My second question is will Liu He be going to the trade ministerial meeting in Tsukuba in Japan next week? And if not, will there be any contact between the U.S. and Chinese negotiation teams either in Tsukuba or the finance ministerial meeting which Yi Gang will be attending? Thank you.

Wang Shouwen:

Thank you for your question. China and the U.S. have held 11 rounds of high-level economic and trade consultations. During the 11th round, the U.S. took the step of raising the tariff from 10% to 25% on a total of Chinese goods valued at $200 billion. It also announced it had launched procedures for additional tariffs on other Chinese goods worth around $300 billion. The U.S. also misused its export control, listing against some Chinese companies. These actions have ratcheted up the trade friction and represent a severe setback to the consultations. The U.S. government should bear the sole responsibility for this.

The two presidents reached an important consensus in Argentina, agreeing to stop imposing additional tariffs and step up consultations towards the removal of those additions already made. However, events have taken a new turn recently, for which the U.S. side should bear sole responsibility.

As to your second question, China will send representatives to the coming G20 Ministerial Meeting on Trade and Digital Economy in Tsukuba. Thank you.

CNR:

The U.S. has accused Chinese companies of obtaining valuable technologies and intellectual property from America through various ways, and believed that the Chinese government has directed companies to invest in American companies to acquire these cutting-edge technologies and intellectual property. What is your response?

Wang Shouwen:

Thank you for your question. China has done a lot of work in intellectual property rights protection and has increasingly become an important nation that leads on intellectual property. Last year, for example, China filed more than 1.5 million utility patent applications, ranking first in the world for eight consecutive years. Of course, while China is inventing and creating, it also trades intellectual property with other countries. We buy intellectual property rights from other countries and also export them to other countries. In terms of purchases, China paid $1.9 billion in intellectual property royalties in 2001, but paid $35.6 billion last year, that's a nearly 19-fold increase. Of that amount, we paid $8.64 billion to the United States, nearly a quarter of our total intellectual property purchases.

Therefore, this shows that China attaches great importance to the protection of intellectual property, so that more and more inventions of its own can be made and companies from other countries will be willing to sell their intellectual property to China. China has done a lot of work in intellectual property legislation, justice, and law enforcement, so that is a welcome development. The Chinese government is not involved in the acts of Chinese companies buying or exporting intellectual property abroad. What the Chinese government does is to create an environment that respects and protects intellectual property rights. This will promote the creation of intellectual property and better protect it. It's also good for the development of an innovative economy.

You mentioned earlier that some people said that "the Chinese government directs Chinese companies to invest in American companies to acquire advanced technologies." I don't think this is true. When Chinese companies invest abroad, what projects to invest in and what to buy or not to buy are entirely their own decisions, they are responsible for their own profits and losses, and make independent decisions at their own risk. The Chinese government is not involved in the specific commercial activities of companies. It does not direct or require companies to invest in any projects or buy any technologies. Thank you.

Phoenix TV:

The trade row has been lasting since March last year. The United States, on many occasions, including during Donald Trump's presidential election campaign and after he took office, has stressed that the US has a huge deficit in its trade with China, which is as high as $500 billion, and saying that the US has lost millions of jobs in its manufacturing industry, and the US has suffered losses in its trade with China. How do you respond to, and comment on these voices? Thanks.

Wang Shouwen:

I have heard these voices, claiming the U.S. suffers huge deficits in trading with China. In fact, whether it is trade deficit or surplus is not related to one side's loss or of being taken advantage of by the other. For instance, the US maintains surplus in its trade with Australia, while Australia enjoys a surplus with China, and China with the U.S. In this circulatory process, there are trade surpluses as well as deficits. Then who loses? And who gains an extra advantage by unfair means?  

It cannot be simply concluded that there is any relationship between trade surpluses and profiting at the expense of the others, or between trade deficit and suffering unfair losses. You mentioned the huge American deficit in trade with China. In fact, the US seriously overestimates its trade deficit with China. For instance, the U.S. sets its trade deficit in goods with China at $419.2 billion. However, is that figure of $419.2 billion accurate? According to research of a statistics team formed between the commerce ministries of China and the U.S., the American figure is usually 20 percent higher than the actual level. So, it is necessary to somewhat discount the US data. Meanwhile, we need to consider that, in Sino-U.S. trade, there are large amounts of processing trade, in which China imports parts from other countries or economies and assembles them before exporting the finished products to the United States. So, China's trade surplus with the U.S. should not be all identified as being China's gain.

Besides, we should take the bilateral trade in services into account. China does indeed have a surplus in goods trade with the U.S. However, according to American estimates, it maintains a huge surplus in services. If all these factors are considered, our conclusion is that, combining the trade in goods and services, the American deficit is only $150 billion, nothing like the alleged $410 billion-plus. Even the $150 billion trade deficit cannot be interpreted as China using unfair means to gain at American expense. This is because in China's trade surplus with the United States, 54 percent stems from the activities of foreign ventures, and 53 percent from processing industry trade. In the latter, China only profits from the processing costs. What does America gain? The products are designed by the U.S., and many key parts are provided by the U.S., which is also in charge of marketing. So, the U.S. side also obtains huge profits from China's trade surplus. When Chinese commodities are exported to the United States, because of their cost advantage, they help lower the burden on American consumers, and helps create a lot of jobs in the wholesale, retail and logistics sectors on the American side. So, it cannot be simply said that imports from China harm American interests.

You mentioned that imports from China have destroyed American manufacturing jobs. In fact, some U.S. research institutes assert that the country started losing manufacturing jobs before China entered the World Trade Organization in 2001. The main reason for this is the advancement of science and technology and the improvement in labor productivity. It is baseless and totally unreasonable to blame China. The American economic structure has changed. Although there are fewer jobs in manufacturing, jobs in the service sector have seen a steady rise, and this has brought the unemployment rate in the U.S. today down to a level not seen for decades. So, whether in service trade or goods trade, no matter who has surplus or deficit on one or the other, Sino-U.S. trade is mutually beneficial and is good for the world as well. Thanks. 

CNN:

It has been noticed that China's comments or stance have become increasingly tougher. While talking about the trade war, officials and media outlets have all mentioned the rare earths issue. And, China announced its "unreliable entity list" on Friday. Some Americans say China remains vague on the list, which gives the Chinese government an opaque means to attack U.S. giants in science and technology, as well as other enterprises. The Chinese media also mentioned FedEx. After Huawei's senior executive was detained in Canada and China detained two Canadian citizens in China, some people feel that the Chinese government will take similar measures targeting at U.S. companies in China as well as American citizens. Some Americans worry about their commercial and investment interests, as well as their personal safety in China. How do you respond to these? Could you clarify and explain China's strategies and tactics in the future trade war? Thank you.

Wang Shouwen:

Thanks for your questions. China's stance on trade frictions is crystal clear - China is not willing to fight, but does not fear fighting. As to what you have said, we think, some of it is being over-interpreted. For instance, as for the FedEx incident, China welcomes foreign enterprises that abide by laws in their operation in China. However, if they violate Chinese laws, we should conduct investigation according to the law. China has just passed its Foreign Investment Law, and stresses that all Chinese and foreign investors in China will be treated equally without discrimination, and foreign investors' lawful rights and interests can be well protected. In this regard, people should feel well assured. However, all companies must abide by Chinese laws, respect Chinese laws, and do business under the framework of Chinese laws.

As for the unreliable entity list, my colleagues have explained about this the day before yesterday. It mainly targets those enterprises, organizations and individuals that violate market principles, the spirit of contracts, block or cut supplies to Chinese firms for non-commercial reasons, and that in some way violate the legal rights and interests of Chinese enterprises, and harm China's national security and public interests. These entities will be added to the list. The purpose is to protect stable, equitable and sustainable trade order between enterprises. So, there is no need to exaggerate this point. Thanks.

CGTN:

First, why does China choose to issue the White Paper of China's Position on the China-US Economic and Trade Consultations at this time? What is the significance of it? We know that China increased tariffs on some imported American products from June 1. What kind of message is China trying to send by doing so? Thanks.

Guo Weimin:

I will answer the first question as to why choose this moment to issue the White Paper. Recently, the China-U.S. economic and trade consultations have received great attention from China and the United States, as well as the international community. It is necessary to offer a comprehensive report on the situations of the consultations and to expound on the stance of the Chinese government on the issue. I think the timing is appropriate and the issuance of the White Paper is of vital importance. This is my answer to the question.

Wang Shouwen:

Thank you for your question. China did increase tariffs on some of the imported American products from June 1. This is a necessary and reasonable response to the escalation of the trade protection actions taken by the U.S. side. We need such measures to protect the rights of the nation, the rights of the people and the rights of Chinese companies. Thank you.

China Daily:

Recently, an intermediary organization said in a report that some U.S. companies in China are facing challenges such as slower customs clearance, more inspections and delayed approvals for licenses. What's your comment on this report? Moreover, the Ministry of Commerce said on Friday that China will establish a list of unreliable entities. How is this system progressing? Thank you.

Wang Shouwen:

Thanks for your question. I've also noticed the report that you mentioned, saying that some enterprises are experiencing slower customs clearance and longer waits for approvals for licenses in China. I'm not sure whether these problems are true or not, and we need to figure out the details of this situation. But we have already been investigating seriously for more information. I want to stress that China has adopted many measures to simplify its customs clearance process. The number of customs clearance document required for imports and exports has been reduced from more than 80 to more than 40, and this number will further decrease in the future. We are also working on speeding up the handling of these documents so as to reduce the overall time on customs clearance. At the same time, we also aim to cut the expenses paid by enterprises in clearing customs. These facilitation measures that China has adopted are very effective, which was reflected in the World Bank's Doing Business Report last year.

China has been constantly deepening its reforms to delegate power, streamlining its administration and optimizing government services through a series of measures in regards to the aspects of examination and approval you raised. Recently, the relevant authorities have issued a notice to further reduce production permits for industrial goods and types of compulsory certifications for products. This is to enable the market to play a bigger role and allow the government to pay more attention to the supervision and administration work which is something that the government must do. For the specific problems confronted by the companies, they can report them to the local commercial authorities. In general, the business environment in China is good, but for the specific issues encountered by certain companies, I suggest they report to the local commercial authorities, or even use the complaint reporting system. According to China's new Foreign Investment Law passed in March, China will establish and improve the complaints mechanism for foreign companies. With the establishment of the complaints mechanism, I suggest that those enterprises report their specific issues through this channel.

As for the progress of the list of unreliable entities you've asked about, the relevant measures will be released soon. Thank you.

Lianhe Zaobao:

Is it possible that Huawei will be included in the economic and trade consultations? Will China put some restrictions on the exports of rare earth metals to counter the U.S.? The third question is also about the list of unreliable entities. What will be the consequences for an enterprise if it is on the list? Thank you.

Wang Shouwen:

Regarding the list of unreliable entities, I've answered earlier, the specific measures will be published soon.

Regarding the rare earth metals, China, being the country with the largest reserves of rare earth metals in the world, is willing to meet justified demands of other countries. However, if some countries use China's rare earth metals to produce products to contain China's development, it is unacceptable. 

Regarding the U.S.-China economic and trade consultations, as I mentioned earlier, it should be based on the principles of mutual respect, equality, mutual benefit and both sides should meet each other halfway. Consultations would be pointless if they are not based on these principles. Without this, we would not be able to reach an enforceable and sustainable agreement in consultations. Thank you.

Guo Weimin:

The last question.

Xinhua News Agency:

At present, everyone is very concerned about the development of the China-U.S. economic and trade negotiations. The U.S. side also stated earlier that the leaders of China and the United States will meet in June at the G20 summit, which the public generally believe to be a key for both sides to restart negotiations. May I ask Mr. Wang, is there any contact at the working level between the two sides? Is there a plan for negotiations? If so, what kind of trade agreement will China accept? Thank you.

Wang Shouwen:

Thank you. As I just mentioned, the reason for the serious setback in the China-U.S. economic and trade consultations is because the United States has raised the additional tariffs on $200 billion of Chinese exports to the U.S. from 10 percent to 25 percent, and then launched procedures to slap additional tariffs on remaining Chinese goods, which are worth around $300 billion. The United States also abuses its national security exceptions and added some Chinese companies onto its list of export control entities, which is the reason for the escalation of economic and trade frictions between the two sides. China has always been sincere in the negotiations. We want to reach an agreement that is mutually beneficial and equal. Allow me to repeat, that if consultations are needed, the two sides involved must respect each other, and work together to meet each other halfway; the consultations must be equal and mutually beneficial. Thank you.

Guo Weimin:

This concludes today's press conference. Thank you.

Translated and edited by Li Huiru, Chen Xia, Zhang Jiaqi, Cui Can, He Shan, Zhang Liying, Zhang Rui, Li Yang, Liu Sitong, Gong Yingchun, Wang Qian, Guo Xiaohong, He Shan, Zhou Jing, Wang Yanfang, Jennifer Fossenbell, Geoffrey Murray, Laura Zheng, Degen Hill, Kenneth Teh Chiu Soong

Read in Chinese

Speakers:

Wang Dongfeng, secretary of Hebei Provincial Committee of the CPC, chairman of the Standing Committee of the People's Congress of Hebei province

Xu Qin, vice secretary of Hebei Provincial Committee of the CPC, governor of the People's Government of Hebei province

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office of China

Date:

May 28, 2019

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference. This year marks the 70th anniversary of the founding of the People's Republic of China. Starting now, we will hold a series of press conferences, and invite the heads of every province, autonomous region and municipality directly under the central government to brief you about local economic and social development over the past 70 years. 

Today, we invite Mr. Wang Dongfeng, secretary of the Hebei Provincial Committee of the Communist Party of China (CPC) and chairman of the Standing Committee of the People's Congress of Hebei province, as well as Mr. Xu Qin, vice secretary of the Hebei Provincial Committee of the CPC and governor of the People's Government of Hebei province, to brief you about the province's development in the new era. 

Now I'll give the floor to Mr. Wang.

Wang Dongfeng:

Ladies and gentlemen, friends from the press, I am very glad to see you here. Firstly, on behalf of the Hebei Provincial Committee of the Communist Party of China (CPC), the Standing Committee of the Hebei Provincial People's Congress, the People's Government of Hebei province, the Hebei Provincial Political Consultative Conference and 75 million people of Hebei, I would like to extend a warm welcome and sincere gratitude to all of you here. 

The theme of today's press briefing is, "Hebei: Forging Ahead on a New Journey in the New Era." I am very delighted to have the opportunity to be with you to review the development and great changes that Hebei province has made over the past 70 years since the founding of the People's Republic of China, and share our vision for Hebei's future of strong economic growth and a beautiful environment in the new era. 

Cherishing a long revolutionary history, Hebei is home to many heroic figures. It was where the plan to establish a new China took shape. Seven decades ago, when Comrade Mao Zedong and the CPC Central Committee left Xibaipo, the move was compared to students going to the capital city to take the imperial examination of old. Since then, under the leadership of the CPC, the Chinese nation has achieved a remarkable transformation — it has stood up and grown rich. Thanks to 70 years of hard work, as with all the regions in the country, Hebei has made historical achievements and witnessed fundamental changes. Generally speaking, five major changes have taken place.

First, the economy continues to develop in a sound manner and great changes have taken place in the overall strength. The province has increased its GDP by more than 880 times since the founding of the People's Republic of China, and the level of productivity has increased substantially, forming a modern industrial system with a solid foundation. In 2018, the added value of high-tech industries accounted for 19.5% of those industrial enterprises above the designated size, 1.1 percentage points higher than that of the previous year. After three rounds of industrial restructuring, the proportion rankings of the three industries had changed from "secondary, tertiary, primary" to "tertiary, secondary, primary" by the end of last year. With new historic changes in industrial, ownership and product structures, the province has made new strides in high-quality development.

Second, with the rising living standards and the income of rural and urban residents, people in Hebei province are forging ahead with a better life and the goal of building a prosperous society. In 2018, the per capita disposable income of urban and rural residents was 119.5 and 123 times that of 1978, respectively.

Third, the constant push for reform and opening-up has facilitated the desired change of growth drivers. By deepening supply-side structural reform and pursuing a new round of high-level opening-up, we have injected greater dynamism into Hebei's development. Nearly 3,000 national-level high-tech enterprises started business in Hebei between 2017 and 2018 alone. The service sector contributed 65.5% of provincial economic growth in 2018. The HBIS GROUP Serbia Iron & Steel is an outstanding example of international cooperation within the framework of the Belt and Road Initiative (BRI). Its management team was awarded the title "role model of our times" by the Publicity Department of the Communist Party of China Central Committee for its contribution to promoting the BRI and building a community with a shared future for all humanity.

The fourth aspect is to promote the harmonious coexistence between humanity and nature. The quality of the ecological environment has been significantly improved. We have resolutely put into practice Xi Jinping's thinking on promoting ecological progress, which resulted in positive changes in environmental protection and constantly improved air quality. As is known, Hebei's industrial structure has long been more inclined to heavy industry and the energy use structure was not that reasonable. In particular, there is considerable surplus steel production capacity. We have adopted the approach to "resolutely cut capacity, actively adjust and accelerate the process of transformation." We would rather sacrifice GDP growth and ensure blue skies for the Beijing region. Through the Beijing-Tianjin-Hebei joint prevention, control and governance program, air pollution control has secured important achievements. Last year, Hebei's concentration of PM2.5 was 56 micrograms, a 48% drop from 2013, and down 14% from the previous year. Not only Shijiazhuang but other cities in the province have witnessed a growing number of days with blue sky. In addition, this also serves as the key to help Beijing and Tianjin to increase their blue-sky days, which, in turn, increases the sense of gain and happiness of the people. The pollution control in regard to water and the soil has also been solidly promoted, and blue skies, green land and beautiful sparkling waters are gradually becoming a reality in Hebei province.

Fifth, we uphold the overall leadership of the Party, and our Party's and our government's working style, as well as our social conduct, have greatly improved. We consistently uphold the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, press ahead with the great new project of Party building, and move further forward with the full and rigorous governance of the Party. We are continually purifying and improving our political ecosystem across the entire province, and the public widely believe that our Party's and our government's working styles have continuously improved, and that our social conduct has achieved a historical level of change. Last year, in the re-elections to the provincial People's Congress, provincial government and provincial Political Consultative Conference, the candidates for all posts approved by the CPC Central Committee and proposed by the provincial Party Committee, as well as for deputies to the National People's Congress, were all elected by unanimous vote or by absolute high vote. In this year's election for the "two sessions" of the province, the candidates for all posts were all elected by unanimous vote.

The achievements of the past 70 years fully demonstrate the unparalleled advantage of the leadership of the CPC and socialism with Chinese characteristics. Hebei people are eager for more achievements in the new era and will make unswerving efforts for this. 

Since the start of reform and opening-up in 1978, particularly after the 18th CPC National Congress, Hebei province has made fresh economic and social advances. General Secretary Xi Jinping is quite familiar with provincial affairs and cares about us deeply. In the 1980s, he worked in Zhengding county, and left us valuable thoughts, cultural wealth and many achievements. After moving on to other posts, he has never ceased caring about us. Since the 18th CPC National Congress, he has made seven inspection tours of Hebei. On Jan. 16, he returned to the province and issued a series of major instructions. On Jan. 18, a symposium was held in Beijing to discuss the integrated development of Beijing, Tianjin and Hebei. He pointed out our shortcomings while recognizing our achievements. In particular, he issued a series of major instructions on improving the quality and degree of integrated development. His remarks mapped the future direction for Hebei's reform and development, and gave us the fundamental guidelines in our ongoing work. When visiting Xibaipo, he stressed that Party officials and Party members should seek a good performance, as well as in other ongoing and upcoming "tests," so as to satisfy the people. 

The provincial CPC committee, the provincial government, all officials and the general public in the province will always bear in mind the instructions of General Secretary Xi. We will strengthen our consciousness of the need to maintain political integrity, think in big-picture terms, follow the core leadership and keep in alignment. We will increase our confidence in the path, theory, system, and culture of socialism with Chinese characteristics. We will resolutely uphold General Secretary Xi's core position on the CPC Central Committee and in the Party as a whole, and resolutely uphold the CPC Central Committee's authority and its centralized, unified leadership. 

We will work hard to achieve good results in the "examinations" of the new era. Surrounding Beijing geographically, we will rally closely to the central authority. We will promote a stable atmosphere in the province to help maintain the capital city's stability. We will make further advances to better contribute to the development of Beijing and Tianjin and the other parts of the country in the reform and opening up. 

We will launch continuous campaigns to study, publicize and implement Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. We will fully implement the guiding principles of the 18th and 19th CPC national congresses, and all major policies and plans made by the CPC Central Committee. We will pursue coordinated implementation of the five-sphere integrated plan and the four-pronged comprehensive strategy. We are totally committed to the underlying principle of pursuing progress while ensuring stability. We will follow the new development philosophy, fulfill the requirements for high-quality development, and take supply-side structural reform as our main task. We adhere to the "3689" plan on provincial development. Based on the achievements of our forebears in this task, we will continue to make fresh advances in the new era, and build Hebei into a strong economic power and a beautiful province.

The major characteristics of Hebei's development can be summarized as follows. First is being firm in political stance and implementing national key development strategies and projects. As is well known, the three key projects for Hebei province include the planning and development of the Xiongan New Area, the coordinated development of the Beijing-Tianjin-Hebei region, as well as Beijing's cooperation with Zhangjiakou city to co-host the 2022 Winter Olympics, in which the sporting events on ice will take place in Beijing and the snow events will be held in Zhangjiakou. All three of these key projects have inspired people in Hebei province, building their confidence and determination to forge ahead and work toward the Chinese dream. Taken as the major political tasks of Hebei province, the three key projects have undergone steady, orderly and effective implementation. Although significant progress has been made in recent years, we can still put forth greater effort. With the further implementation of national key development strategies and projects, Hebei province has become a popular destination for investment from all over the world. 

Second is the full implementation of the new development philosophy, making solid progress in innovative, green and high-quality development of Hebei province. We will fully implement General Secretary Xi Jinping's important instructions to scale down overcapacity, promote structural readjustment and speed up the transformation of growth drivers. We will accelerate the transformation and upgrading of traditional industries, and improve their quality and performance. In order to achieve this goal, we need to, first of all, cut overcapacity in the steel industry. The steel produced in Hebei province is of world-class quality, yet such overcapacity is not outdated. Our principle in this regard is to "shut down small outdated steel plants and strengthen development of big producers, and promote the elite and phase out the inferior." Up to now, the total steel production volume is still relatively large. With a 14-million-ton annual reduction in steel production, the annual volume of steel produced in Hebei is expected to be held within 200 million tons by 2020. Meanwhile, we also encourage the global development of our advanced industrial capacity. For example, the HBIS Group Serbia Iron & Steel was awarded the title "role model of our times" by the Publicity Department of the Communist Party of China (CPC) Central Committee. It sets a model on how China's steel industry can go global, and a success story in international cooperation under the Belt and Road Initiative. In addition, we have made progress in the development of strategic emerging industries and the modern service industry. The province has sustained steady and sound economic and social development. Last year, Hebei's GDP increased by 6.6% and the general public budget increased by 8.7%. Per capita disposable personal income in urban and rural areas increased by 8% and 8.9% respectively. The first quarter of this year saw a good start, as its GDP increased by 7.4% and its general public budget increased by 13%. During the January-April period, the value added from industrial enterprises with annual revenue of 20 million yuan or more increased by 8.8%,  with the high-tech industries growing by 15.5%. In the first quarter, the per capita disposable personal income in urban and rural areas increased by 7.9% and 8.9%, respectively. The fixed-asset investment increased by 6% and foreign investment utilized increased by 10.6%. The gross export value increased by 12.3%. Many figures from the first quarter reached their highest level compared to the same period in recent years. 

Third, we should adhere to the people-centered development methods to continually enhance the people's sense of gain, happiness and security. Serving the people should be made the starting point and foothold of all work. The CPC Hebei Provincial Committee and the Hebei provincial government have kept at it for many years, with 20 livelihood projects launched every year, such as the renovation of shanty areas, transformation of old residential communities and dilapidated rural houses, renovation of "villages" inside cities, and more. By these means, the people's concerns about employment, starting new businesses, medical care, education and caring for the elderly have been well addressed, the income of urban and rural residents has increased continuously, and the environmental and ecological issues that the people care about have also been markedly improved. 

For example, the authorities have dealt with bulk coal pollution to promote clean heating in winter, which helps to transform the energy structure and also controls pollution. We have so far replaced bulk coal stoves with electricity and natural gas in 5.35 million homes. 

We have also carried out the greening campaign. Last year, Hebei saw its forest area grow by 9.87 million mu (658,000 hectares), and this year, we will further enlarge it by over 10 million mu. When you travel in Hebei by car or train, you can see green everywhere on either side of the roads and railways. For one thing, we need to deal with air pollution to win the blue-sky battle; and for another, we need to plant trees to improve the ecology, and we need to keep the water clean. 

Air pollution control is an inter-regional effort, and water pollution control is a joint effort with Beijing and Tianjin in terms of the whole river basin. Soil contamination prevention and control work is being undertaken by local governments. Delivering these combination blows, Hebei has been taking the initiative to protect the environment. Hebei has also carried out a rural revitalization strategy to improve the living environment in villages, and people's living and working environments have hence been greatly improved. 

These achievements have been made possible by the firm leadership of the CPC CentralCommittee with Comrade Xi Jinping at its core, as well as by the support of all relevant ministries, other provinces, cities and autonomous regions, as well as the whole society, including the media. These achievements are also returns on the Hebei people's united struggle. 

It is an arduous challenge and serious duty for Hebei to forge ahead on a new journey in the new era. Xi Jinping, general secretary of the CPC Central Committee, points out the times give us a test, we are the exam takers, and the people are the ones in charge of reviewing the exam papers. On the journey of the new era, Hebei should rally closely around the CPC Central Committee with Comrade Xi Jinping at its core, and must always be true to its missions, bravely assume its responsibilities, and strive to celebrate the 70th anniversary of the founding of the People's Republic of China with the latest developments on all fronts.

Now is the time for Xu Qin, provincial governor of Hebei, and me to take your questions. 

Hu Kaihong:

Thank you, Mr. Wang. At this time, we welcome questions, Please report the news agency you represent before asking your question.

CCTV:

Over the past five years, Hebei has done a lot to promote the coordinated development of the Beijing-Tianjin-Hebei Region, especially in striving for breakthroughs in the three key areas of transportation, environmental protection, and industry. What will Hebei focus on in advancing in the future? 

Wang Dongfeng: 

Thank you for your question. We all know that the coordinated development of the Beijing-Tianjin-Hebei Region is a significant national strategy that is designed and promoted by General Secretary Xi Jinping and he has paid great attention and much effort to it. I have mentioned the Beijing-Tianjin-Hebei cooperative efforts on making breakthroughs in promoting traffic integration, joint prevention, control and management of pollution and industrial collaboration in my report. I won't repeat it. Though, we have some measures in the next phase which are as follows: 

First, we will focus on relieving Beijing of functions non-essential to its role as capital and work to build the Xiongan New Area, a centralized platform accommodating relocated functions and other platforms in cities and counties in Hebei. General Secretary Xi stressed in the report to the 19th CPC National Congress that relieving Beijing of functions which are non-essential to its role as capital is key to the coordinated development of the Beijing-Tianjin-Hebei Region. In the planning outlines and general plans approved by the CPC Central Committee and the State Council, it is clearly stated that the Xiongan New Area is the centralized platform accommodating non-capital functions of Beijing. It is the primary principle guiding its development. There are some other cities and counties in Hebei accommodating relocated functions of Beijing. For example, the three counties in Lanfang city, which are located between Beijing and Tianjin and have a larger area than Beijing sub-administrative center, have been approved to use the same standard as the Tongzhou District in making plans, standards and policies, and management, according to a general plan made by the CPC Central Committee. The development plan has been submitted to the Leading Group of the Coordinated Development of the Beijing-Tianjin-Hebei Region and will be carried forward after approval. This will be a new cooperative platform. The Beijing Daxing International Airport will be put into use in September. Occupying areas in both Beijing and Hebei, the airport is a hub in Beijing and northern China. So it is Hebei's political duty to guarantee a stable overall situation and offer good services in the airport. In the vicinity of the airport, a 150-square-kilometer airport economic zone is to be established, with 50 square kilometers in Beijing and the other 100 square kilometers in Hebei. It will also use the Tongzhou standard in making plans, standards and policies, and management. A new coordination and cooperation mechanism will be set up and the plan is also under examination. Additionally, Langfang, Wuqing and Tongzhou are also pilot zones of the coordinated development mechanism of the Beijing-Tianjin-Hebei Region that apply unified standards and stick to integrated development. Three ports in Hebei, namely, Qinghuangdao, Tangshan and Huanghua ports, form part of the Bohai-Sea Port Cluster together with Tianjin Port. Hebei introduced 2,516 projects from Beijing and Tianjin last year with a capital inflow of 430.8 billion yuan. More than 1,400 high-tech enterprises have moved from Beijing and Tianjin to Hebei so far.

Second, Hebei will make comprehensive efforts to fulfill the designated functions and accelerate its development while serving and aligning itself with Beijing and Tianjin. Hebei was designated as an important national base for modern trade and logistics, a pilot zone for industrial transformation and upgrading, a demonstration area for modern urbanization and coordinated development of urban and rural areas, and an ecological buffer zone. In accordance with the positioning, the cities and counties in Hebei province are working to promote high-quality development by making differentiated but coordinated progress. Dahongmen Clothing Wholesale Market, Xinfadi Agricultural Products Wholesale Market, and Beijing Zoo Clothing Wholesale Market have been relocated from Beijing to Baoding and Cangzhou. We are promoting the development of cities of different sizes in different regions to foster new development platforms and advance the establishment of a world-class city cluster with Beijing at the core. We have taken a series of measures to ensure ecological security of the capital and to prevent and control air and water pollution. Notable progress has been made after several years of efforts to improve river basins upstream and downstream and curb over-exploitation of groundwater in the North China Plain. Recent media reports said water came to the surface of lakes and rivers from under the ground in Xingtai, suggesting a rise in the water table. We are now implementing restrictions on the use of groundwater and are making good use of the water diverted from the South-to-North Water Diversion Project and the Yellow River Water Diversion Project. We require self-provided wells to be closed in places where water can be diverted from the South-to-North Water Diversion Project, and we charge fees for using groundwater. In addition, Hebei Provincial People's Congress has also introduced relevant laws to combat this problem. In short, we have been making efforts on the legal, economic, administrative, and other fronts to improve Hebei's ecological environment.

Third, we will unswervingly advance the construction of "two new driving forces" and "two zones" so as to drive the green development in Hebei province. This is another major initiative proposed by General Secretary Xi Jinping. The development of both Xiongan New Area and Beijing's subsidiary administrative center will become two new driving forces for Beijing's development. And the development of both Xiongan New Area and Zhangbei county in Zhangjiakou city - a co-host with Beijing to the 2022 Winter Olympics - will become two new driving forces for Hebei's development. The "two zones" that have been proposed by General Secretary Xi Jinping in Zhangjiakou refer to the capital's water source conservation zone and the ecological buffer zone. Their construction is not only Hebei's ecological task but an important political responsibility. Zhangjiakou city, Hebei province, provides water for ecological development and people's daily life in both Beijing and Tianjin. Miyun Reservoir (in Beijing's Miyun district) serves as Bejing's water source; Guanting Reservoir, which is located in Zhangjiakou city, used to be Beijing's water source earlier. Moreover, Yuqiao Reservoir, as part of the Water Diversion Project from Luanhe River to Tianjin Municipality, serves as Tianjin's water source. Hebei is located in the upstream area of all these reservoirs, so we have the responsibility to ensure the water quality for Beijing and Tianjin. This is Hebei's role as a water protector. It is a major strategy. Hebei province, together with the National Development and Reform Commission (NDRC), has submitted working plans to the CPC Central Committee and the State Council. A lot of work is underway, and some initial outcomes have been achieved, all of which need the concern, support, and assistance of the media outlets. 

Generally, we will, following a series of measures, strive for new progress in promoting innovative, green, and high-quality development in Hebei province. Thank you. 

China Arab TV:

People from all walks of life are paying close attention to the construction of Xiongan New Area, and the media have also reported many times that Xiongan New Area is about to reach its large-scale construction phase. What will be the biggest change it can show to the world next? 

Wang Dongfeng:

Thanks for your question. The establishment of Xiongan New Area is a historic and major strategic choice made by the CPC Central Committee with Comrade Xi Jinping at its core. General Secretary Xi Jinping has made great efforts to plan for it and promote its construction. Under the strong leadership of the CPC Central Committee and the State Council, the planning and construction of Xiongan New Area have been pushed forward in an orderly and effective way, turning now from top-level design to substantial construction. The progress also embodies the support of the Leading Group for the Coordinated Development of the Beijing-Tianjin-Hebei Region and its office, as well as ministries and commissions, plus the help of Beijing, Tianjin and other brother areas, as well as the care and help of our media friends. In the process of implementation, what more can the plan show the country and the world, apart from the construction of a new modern city? 

First, striving to create a Xiongan quality standard and a national role model of high-quality development. Creating a Xiongan quality standard is a strategic goal put forward by the CPC Central Committee and General Secretary Xi Jinping for Hebei province and Xiongan New Area. In the first place, centering on high-quality development, Xiongan will perform well as a model of high-quality development in the country. From the perspective of a high-quality index system, it will benchmark world-class standards, and carry out quality management throughout its planning and construction. It will uphold high-tech and high-end principles, build quality and model projects, and create a Xiongan quality standard. This is a highlight, and a focus of international and domestic attention. 

Second, striving to promote innovative development and build a demonstration area for innovative development that implements the new development concepts. Xiongan will pursue innovative, coordinated, green, open and shared development in a comprehensive fashion. It will take in elements of innovation from Beijing and Tianjin, integrate resources and elements from the whole country and around the globe, establish a batch of key national laboratories, and re-innovate upon introduction and absorption, so as to promote the development of high-end and high-tech industry clusters. Such moves will allow a demonstration area featuring the five concepts to take shape and effect in Xiongan, and benefit the general public as the work goes on. 

Third, striving to develop a new generation of artificial intelligence and establish itself as a world-leading digital smart city. People around the world are paying attention to the construction of smart cities. Xiongan will make its standard system more systematic, comprehensive and international. Xiongan New Area is now constructing the underground part first, and the aboveground part will follow. It will adopt the use of the Beidou Satellite, remote sensing, infrared rays, terahertz, facial recognition, big data, cloud computing and other technologies, and is using BIM and CIM in the process of construction. Induction facilities, as well as optical fibers and cables, are required to be buried underground, so if not buried now, it will be too late to wait for the completion of construction. In the past, transportation, medical care and urban management of smart cities were considered independent from each other while construction. Different cities have a variety of good methods and experiences, and Hebei has integrated the experiences of smart city planning across the country and the world. The important thing for now is to formulate a good strategic plan, to improve as the work goes on and to eliminate wasteful duplication of efforts. 

Fourth, striving to promote reform and opening up and to reach new heights in institutional and mechanism reform. The Xiongan Administrative Committee has jurisdiction over three counties in Baoding city. There is no local Party committee, people's congress, government or Chinese People's Political Consultative Conference (CPPCC) committee in Xiongan New Area, which represents a new political, economic and social model featuring a flat structure, coordination and high efficiency. When it comes to public security, environmental protection, court and procuratorate affairs, it is necessary to stress social management and governance in accordance with the law. Therefore, the province has designated offices in Xiongan New Area, and there are local Party committees, people's congresses, governments and  CPPCC committees in the three counties, which are administered by the Party Working Committee and the Administrative Committee. No existing mechanism or model can be referred to, which, thus, requires innovation. In accordance with the guidelines and arrangements of the CPC Central Committee, the provincial Party committee and the provincial government have granted Xiongan New Area with the power of economic and social management, and entrusted the three counties to the Party Working Committee and Administrative Committee of Xiongan New Area. The admittance of market players, consultation, acceptance of applications, approval and handling of business and feedback can all be processed online, regardless of whether the applicants are at home or at work. 

In addition to the abovementioned four aspects, Xiongan New Area will next focus on the comprehensive governance and protection of Baiyangdian Lake, major construction projects like infrastructure, support facilities and peripheral transportation, livelihood, land acquisition and demolition. Currently, the Beijing-Xiongan High-Speed Railway is under construction and will begin operation next year. We are also planning to connect to Beijing's subway system and the airport express to and from Beijing Daxing International Airport. If these are all connected, you could take the subway from downtown Beijing to Beijing Daxing International Airport, then transfer to the airport express to reach Xiongan. People from Xiongan New Area could check their luggage in Xiongan, go directly to Daxing International Airport for boarding with their boarding passes, and reach downtown Beijing conveniently. You can live in Xiongan and work in Beijing, or live in Beijing and work in Xiongan, both of which are very convenient. Xiongan New Area is a major plan for the millennium and a major event for the country. Both domestic and foreign media pay close attention to it, and have effectively helped to popularize it with positive coverage. We need your continued help. That is all. 

China News Service:

The air quality in Hebei province has improved in the past two years. What measures has the government taken to prevent and control air pollution? And what achievements has Hebei made? 

Xu Qin:

Thank you for your concerns about Hebei's air environment. A good environment is beneficial to our people. The CPC Hebei Provincial Committee and the provincial government firmly implement the decisions and plans of the Party Central Committee. We prioritize ecological conservation and green development, and we continue to control air pollution. General Secretary Xi Jinping requires that we build a beautiful Hebei with blue sky, green land, and clean water. The Hebei government implemented General Secretary Xi Jinping's important instructions and has always highlighted the control of air pollution, making contributions to the region's air quality. 

First, we established the Ecological Protection Committee and appointed the provincial Party Secretary and the provincial governor as directors. Second, we mulled over the "1+18" policy system to prevent and control air pollution. In the system, we take measures in six aspects to improve the air quality, which covers a wide spectrum of areas. After years of efforts, the average density of PM2.5 in Hebei province has already dropped by 39.8 % in the past four years, and in 2018, the average density of PM2.5 dropped by 14 %. Currently, the air quality in Hebei province is the best it has been in the last six years. The measures we took are as follows: 

The first measure is the prevention and control of industrial pollution. The emissions from the industry can put great pressure on the environmental carrying capacity. We reduce the production capacity and upgrade the steel and coal industries to achieve ultra-low emissions. More than 120,000 heavily polluting enterprises were closed down and upgraded. The emissions that pollute the air have greatly reduced. From 2013 to 2018, we have reduced the emissions of dust by 276,000 tons and reduced the emissions of sulfur dioxide and nitrogen oxides by 45.5% and 37.1% respectively. 

The second measure is the prevention and control of pollution from coal burning. Dispersed coal operations are one of the major sources of air pollution in autumn and winter. We take measures to control the emissions from dispersed coal burning in rural areas by replacing the coal with gas and electricity. So far, a total of 5.35 million households in Hebei province have been upgraded. This year, we plan to upgrade 1.8 million households, which is in accordance with the storage volume of gas and electricity. This kind of replacement contributes to at least 30% of the improvement in air quality.The cities around Beijing -Langfang city, Baoding city, and 20 counties that cover a total area of 118,000 square kilometers - are listed as the "no-coal" area. This greatly reduces air pollution from coal burning. Hebei will cut the total consumption of coal by 4 million tons this year. 

The third measure is the prevention and control of pollution by vehicles. Hebei is an important passage of transportation with a large number of vehicles passing by. The pollution from vehicles also causes great pressure on the environment, so we need to improve the quality of refined oil and related oil products. Starting from July 1, the "National VI" emission standard will be implemented. We will further optimize the transportation structure by replacing truck transport with rail transport, in a bid to further reduce emissions. We also encourage the local railway administration to cooperate with companies to build special lines for transportation, which will reduce the emissions from vehicles. 

The fourth measure is to prevent and control wind-borne dust and promote afforestation. The efforts to prevent and control wind-borne dust has been made in six aspects, including construction sites, urban roads, bare lands in urban and rural areas, stock grounds of companies, highways, and surface mines. Meanwhile, we promote afforestation. From 2013 to 2018, we have afforested 2.33 million hectares of land. As Mr. Wang has mentioned before, we plan to afforest 0.66 million hectares of land this year. The Saihanba Forest Farm has created a green miracle by transforming the barren wasteland to a sea of forests. The forest farm received top environmental honors from the U.N. 

The fifth measure is to tackle heavy air pollution. We have built a trans-regional governance model with Beijing and Tianjin for joint environmental prevention and control, unifying the efforts of early warning, emergency response, and joint law enforcement in different areas in order to make sure all kinds of measures will be carried out to control the heavy air pollution. 

The sixth measure is to focus on rectifying prominent environmental problems. We will focus on rectifying the ecological problems found during environmental inspections and always look back to examine how the government controls the pollution. We will ensure the strict law enforcement and measures are put in place, in a bid to improve the air quality. As you can see, the air quality in Hebei province has improved a lot. With these measures in place, the air quality in Hebei will become better in the future. 

Phoenix Satellite TV:

We noticed that at the beginning of this month, after the approval of the Hebei provincial poverty alleviation office and the leading group for poverty alleviation, 21 districts and counties such as Zanhuang county have been taken off the list of poverty-stricken counties. At present, how many poverty-stricken counties and how many poor people are there in Hebei province? What are the current difficulties? How will the Hebei provincial government respond to the two major problems of tackling poverty alleviation and preventing the return to poverty? Thank you. 

Wang Dongfeng: 

Thank you to the reporter from Phoenix Satellite TV. I'll address this question. Winning the battle against poverty is one of the three major battles put forward by General Secretary Xi Jinping in the report delivered at the 19th National Congress of the Communist Party of China. It is also a major political task in terms of implementing people-centered development thoughts. The task of poverty alleviation in Hebei province is relatively heavy, which originally had a poor population of 4.99 million people. There were 45 poverty-stricken counties as recognized at the national level and 17 as recognized at the provinciallevel. Last year, 21 poverty-stricken counties grew out of poverty and 650,000 people steadily rose out of poverty. There are still 399,500 poor people and 13 poverty-stricken counties. This year, if 330,000 people were taken off from poverty list, and 13 poverty-stricken counties all got rid of poverty, there will be only 69,500 poor people left. They will be fully lifted out of poverty in the first half of next year. The inspection and recognition will be carried out in the second half of next year, and then our achievements will be consolidated to prevent a rebound. This is how the progress of poverty alleviation works. Last year, we made a turnaround win and registered good grades in the national assessment of poverty alleviation achievements, as well as in the assessment of poverty alleviation by coordination efforts from east and west China. The poor counties and the poor people still left are the "hardest bones" and are mainly located in the cities of Zhangjiakou, Chengde and Baoding. The three cities are overseen by myself, Mr. Xu Qin and the deputy secretary of the provincial Party committee, respectively. And each member of the provincial Party committee oversees one city in the province. Among the cities, there are great poverty counties under them. We want to ensure that we can accomplish the annual poverty alleviation task as scheduled this year and ensure that the battle against poverty will be fully won next year. 

We are taking several measures to overcome the hardest challenges, and to prevent the return to poverty: 

First, we must strengthen the implementation of responsibilities and continue to work hard to cement our poverty alleviation achievements. The Party secretaries of five levels will work hard together to get rid of poverty. Their Party job and government job should share the same responsibility, while their own single official post should have dual responsibilities. All the responsibilities should be fully implemented from one level to another. From the province to the city and to the county, the leading cadres at all levels will join the poverty alleviation battle with poverty-stricken counties and poor households, as well as with the poverty alleviation teams and working groups stationed in the villages. For those that were already lifted out of poverty, they should achieve "four don'ts", which are: don't relieve responsibility, don't terminate policies, don't stop helping, don't end supervision. This is the first measure to resolutely prevent the return to poverty. 

Second, we need to pay close attention to the bottom-line task and comprehensively resolve the "two no worries and three guarantees." We implement interaction between the higher and lower levels and integration of departments and regions at different levels. For issues of education, health, dangerous houses and low income of ordinary people, etc., the provincial departments are responsible, while the municipal, county and village secretaries are responsible for organizing special improvement campaigns. To combine the rural revitalization strategy and to build a moderately prosperous society in all respects, the provincial government fully deploys and fully implements all actions to achieve high quality and meet high standards. 

Third, we will focus on key efforts, and on soundly addressing industrial poverty alleviation, employment poverty alleviation, science and technology poverty alleviation and relocation poverty alleviation. This is an important measure to enhance revitalization and ensure sustainable development. For these to work effectively, they must adhere to the "one town, one industry; one village, one product" policy, in order to develop unique industries. Li Baoguo from Hebei province is an excellent role model recognized by the instruction from General Secretary Xi Jinping, and he is a role model of our time. He was a professor at Hebei Agricultural University, and his wife follows his steps and continues to serve the people. Now the Hebei Academy of Agriculture and Forestry Sciences, Hebei Agricultural University and other agricultural research institutes, as well as help teams, will go into villages to resolve technical problems for people during their planting and the aquaculture processes, and will increase the scientific and technological content and added value for their agricultural products. And regarding relocation, it should be combined with the management of hollow villages. The Bashang region of Zhangjiakou is bordered by Inner Mongolia. There are many hollow villages, which means there is basically no labor there — only the elderly are left behind. To accomplish a series of support facilities for water, electricity and heating, we need a lot of investment. We are determined to move the people from Bashang out of the hollow villages and relocate them to the counties, towns and other villages. The elderly who have no ability to work will be sent to nursing homes, the ones who can work will enter the industrial parks, and the children will go to schools. If they need vocational training, they will have vocational training, which will lay the foundation for future employment and entrepreneurship. Bashang region will then return farmland to grassland to build ecology, and after the grassland is restored, we can repurpose it for grazing and raising cows. We are fully coordinating and promoting the relocation of the hollow villages, and the results have been very good. For the completion of a new type of urbanization and the construction of a moderately prosperous society in all aspects, this is a combination package of measures which will have comprehensive effects. We must make further efforts and ensure that we can move them out, let them live steadily, and increase their wealth. 

Thank you, reporters. 

The Economic Daily:

During the first quarter of this year, Hebei achieved a relatively high economic growth rate of 7.4% year over year. What are the measures that you have adopted to pursue economic restructuring, reduce excessive industrial capacity, promote economic transformation and high-quality development? What achievements have you made? 

Xu Qin:

Thank you for your interest in Hebei's economic development. The good start of Hebei's economy during the first quarter of this year should be attributed to the concerted efforts of the entire province along with the Hebei CPC Committee and provincial government, who resolutely implemented the guidelines of the Central Economic Work Conference. As you just said, our GDP growth rate of 7.4% in the first quarter is the best in years. Meanwhile, our fiscal revenue increased by 13%, the value-added of industries above the designated size grew by 8.8%, applied foreign investment rose by 10.6% and exports jumped by 12.3%. The remarkable achievement is proven by the data. But how did we make it into reality? This is a big issue and I will give you a quick introduction. 

We have resolutely put into practice the important instructions of General Secretary Xi Jinping. General Secretary Xi has inspected Hebei seven times since the 18th CPC National Congress and has made a series of important instructions for us. In particular, he asked Hebei to resolve difficulties resolutely and accelerate transformation proactively. We have implemented the General Secretary's instructions in all these aspects, followed the new development philosophy and pushed forward the supply-side structural reform. Our concrete steps include: 

First, we have made three-year plans. During the past two years, we worked out 15 three-year action plans, covering areas like innovation-driven development, industrial transformation and upgrading, and strategic emerging industries. They have been formulated in line with the "13th Five-Year Plan" and lay a solid base for the upcoming "14th Five-Year Plan." In doing so, we are embracing overall industrial transformation and upgrading and improving economic quality. 

The second is our efforts to cut overcapacity. We have worked out a number of regulations and standards concerning quality, environmental protection and security issues which force some industries to cut overcapacity. Other measures include merging and restructuring of enterprises, closing valueless small enterprises and relocation to cut excessive capacity. Meanwhile, through international industrial-capacity cooperation, we have exported advanced production capacity. Through our endeavors, steel enterprises in Hebei have reduced from 123 to 64 and their productive capacities have been reduced by 82.23 million tons since 2013. It is not easy to make such an achievement, especially when China must simultaneously deal with the slowdown in economic growth, make difficult structural adjustments, and absorb the effects of previous economic stimulus policies. We have overcome many difficulties, including how to help workers displaced due to overcapacity cuts. However, we would rather temporarily sacrifice GDP growth and fiscal revenue, and win a strategic space for development in the future. We're determined to fight to keep the sky blue above Beijing, Tianjin and Hebei province. 

The third is that we have made efforts to promote innovation-driven development from five aspects: innovation entities, innovation capacity, innovation professionals, innovation ecosystem and innovation environment. Just as Mr. Wang said that in the beginning of 2017, the province had a total of 2,031 national-level high-tech enterprises. Over the past two years, the number has grown to 5,099, and we expect the number will be more than 7,000 by the end of this year and 10,000 within three years. The number of high-tech SMEs has grown by 26,000 in the past two years and it is expected to surpass 80,000 next year. During the first quarter of this year, the number of patent applications and authorized patents grew by 59.5% and 55.6% respectively. Last year, investments, value-added and exports of high-tech enterprises rose by 30.4%,15.3% and 28.3% respectively.

The fourth is to transform and upgrade our industries through six methods. There are 150,000 traditional manufacturing enterprises in Hebei province, so there is huge potential to improve the quality, build brands and increase efficiency. Many industries are low end, therefore, moving up to high end will increase their future competitiveness. This is the main battlefield of transformation and upgrading. We took the following six methods to transform and upgrade traditional industries. 

First, we have persisted in achieving high standards and high quality. Here is an example. The Junlebao Dairy Co, Ltd participated in the World Food Quality Evaluation Conference last year and won the highest prize: the "Special Gold Award." Now its milk powder has been sold to Hong Kong, with demand exceeding supply. 

Second, we have put more emphasis on industrial design so as to improve the quality of our products and give them more cultural and artistic connotation. At the same time, the added value of our whole products has been improved. 

Third, we have launched the technological transformation and upgrading plan. We intend to complete the technological transformation of large industrial enterprises by 2020. 

Fourth, we have extended industrial chains. We have promoted the integration of upper- and lower-stream cooperation between industries, so as to create a group of famous brands and achieve the upgrading of industrial chains. 

Fifth, we promoted the in-depth integration of industries. In order to achieve industrial transformation and upgrading, we promoted traditional industries to integrate with artificial intelligence (AI), the internet, and big data. The approach is also a future development trend and key area. 

Sixth, we have implemented innovation-driven development. This is an important means to enhance the competitiveness of future industries. 

There are many examples in these six areas. Take Handan-based Chenguang Biotech Group Co, ltd for example. The company has advanced bio-extraction technology, and its capsicum red pigments provide the global supply, occupying a considerable share of the international market. 

Meanwhile, we have further optimized the distribution of the industrial chains of the whole province. At the city level, we promoted the development of leading industries; while at the county level, we promoted the revitalization of economic endeavors with distinctive features of local areas. According to our statistics, there are a number of traditional industries with obvious competitiveness in Hebei province, and 80 of them exceed 10 billion yuan in economic strength. Many of them are leading enterprises in their industries, playing a very important role in the national trade and export market. These industrial clusters with distinctive local features will foster a new source of growth of Hebei. In the future, we will realize the transformation and upgrading of traditional industries, so as to optimize the supply, improve the quality and increase the benefits. Through several years of efforts, we will double both the scale and efficiency. 

Finally, we stepped up efforts in fostering the emerging industries of strategic importance. We pursued the coordinated development of the Beijing-Tianjin-Hebei region and promoted high-level openness to achieve interconnected growth. We gathered resources, opened up markets and developed emerging industries of strategic importance. We have worked out ten development goals and have comprehensively promoted the implementation of plans involving AI, intelligent manufacturing equipment, information technology industry, biotechnology industry, new materials, advanced environmental protection and other fields. We also implemented six major projects, such as the industrialization of high and new technology. 

Emerging industries of strategic importance grew by 16.8% in the first quarter of this year, while other industries doubled at the same time. We will seize opportunities, further promote industrial transformation and upgrading, and maintain sustained and high-quality economic development. At the same time, we also planned in advance for some future industries, such as emergency equipment industry, the winter sports industry and the rehabilitation industry. These industries have huge market capacity, but the current supply cannot meet market demands. Hebei will continue to make great efforts to promote industrial transformation and sound economic development.

CNR:

A 1,000-day countdown activity was just held in Zhangjiakou to mark the preparations for the 2022 Beijing Winter Olympics. How is Zhangjiakou's preparation for its part in the games? 

Xu Qin:

Holding a successful Winter Olympics is of national significance, which is pushed by General Secretary Xi Jinping in person. The CPC's Hebei provincial committee and the provincial government have long adhered to their political duties to prepare for the games since it is a big project for the province. Secretary Wang Dongfeng just said that there will be 109 gold medals in the 2022 Winter Olympics, among which 51 will be awarded in Zhangjiakou. 

Currently, the preparation is being carried out in an orderly manner. We have fully implemented President Xi's four concepts on hosting the games – green, sharing, open and honest – in a bid to make them a fabulous, unique and outstanding event. Under the leadership of the 24th Winter Olympics Leading Work Group, and with the guidance of the organizing committee for the 2022 Beijing and the supports of relevant ministries and commissions, Hebei will closely cooperate with Beijing to advance relevant work. 

In terms of the construction of venues and supporting facilities, we organized nearly 80 domestic and foreign planning teams to roll out 10 special planning schedules and seven zoning plans over the past two years. In the display today, there is a designing plan for a new competition venue for the Winter Olympics. 

Meanwhile, we have ensured that construction projects and their organizations are of high quality and high standards. Currently, the construction of 70 venues, out of 76, has been started, and the rest will be started this year to ensure they can be finished in time to meet the requirements of the test competitions and the games. 

The high-speed railway train connecting Xizhimen of Beijing and Chongli of Zhangjiakou will come into operation. It will take about 47 minutes to reach the downtown of Zhangjiakou from Beijing, and 55 minutes to arrive in Chongli. This will make it more convenient for the winter sports lovers in Beijing to go to Zhangjiakou, and will provide good transport conditions for industries' relocation to Zhangjiakou and its neighboring regions. Zhangjiakou is a paradise for winter sports and a summer resort. The city welcomes you all.

The other guarantee measures are also proceeding as planned. The guarantee plans for traffic, security, accommodation, dining, medical care and volunteer services have already been made. In the future, the region's medical care will be very good, and the Peking University Third Hospital has set up its branch in Zhangjiakou. Sport medical care resources will also be expanded in the region. At the same time, the people's winter sports will develop fast, as winter sports teams will be organized to take part in relevant training of the national teams to provide better support for the sports resources of the country. 

At the same time, we will promote the development of our winter sports industry. Two winter sports industrial bases have been planned in Zhangjiakou. Last year, 15 enterprises from the United States, Japan, the Republic of Korea and Europe have registered in Zhangjiakou, and another 20 companies have signed contracts to invest in the region. This year, at least 20 companies will be registered and another 30 will sign investment agreement, which will help form the backbone of the winter sports industry. Currently most winter sports apparatus and wearable equipment are foreign brands and manufactured abroad. It is hoped that Zhangjiakou can foster the industry's booming into a new growth point while working together with Beijing on the Winter Olympics. 

General speaking, we should host a successful Winter Olympics on the one hand, and develop Zhangbei into a powerhouse of the province, as Xi required. Zhangjiakou is a water source and ecological supporting zone for the capital. We are forging ahead according to the central authorities' requirements to ensure Zhangjiakou's ecological functions are well protected. That's all. Thanks.

Hebei TV: 

Economic development in Hebei has entered a stage featuring fast, stable and healthy progress. We have noticed that, this year, the number of market entities in Hebei has increased rapidly. What has the provincial government done to improve the business environment, such as launching major projects and changing the proportion of foreign investment? What do the figures mean in practice? 

Wang Dongfeng: 

This is an important question. A good business environment is critical to the development of Hebei. It involves promoting economic development, providing services to enterprises and the general public, establishing a good local credit system, building integrated government programs, and launching reforms to streamline administration, delegate powers and improve regulation. 

The provincial Party committee and the provincial government regard improving the business environment as a major political task. We focus on fostering a sound environment in legal, market, service and administrative fields, and promoting fair and just market competition. Our aims are boosting economic progress, promoting quality development, serving enterprises to enhance their competitiveness, and serving the people to ensure they feel more satisfied and happier. 

A series of effective measures have been undertaken in this regard. Last year, on the first day back to work after the Spring Festival, the provincial Party committee and the provincial government held a meeting on developing innovation and business startups, and better serving enterprises and the general public. This year, on the first day back to work after the Spring Festival, we held a meeting on promoting the development of innovation and business start-ups, improving people's livelihood, and intensifying discipline. In the past two years, we have spared no efforts in pursuing these goals. Focusing on reforms to streamline administration, delegate powers and improve regulation. We have improved the construction of a social credit system and enterprise credit system in an all-round way. Historic changes have taken place in the investment environment, with more market entities emerging. The  core competitiveness of enterprises has been improved, and the public is becoming more satisfied, happier and more secure. 

Major measures we have taken include: First, intensifying efforts in developing innovation and business start-ups, and in serving enterprises and the people, so as to stimulate the vitality of market entities. Last year, the number of market entities reached 5.38 million in Hebei, with a year-on-year increase of 14.5%, while the number of high-tech enterprises and high-tech SMEs increased by 1,800 and 13,000 respectively. 

Second, intensifying our efforts to improve the public livelihood, so as to guarantee and improve production and living conditions. We always put people first in development. Sufficient funds have been earmarked in the government budget to improve the public livelihood. More than 80% of our expenditure has gone to this field. Governments at all levels have worked together and launched 20 related projects. The emphasis has been on employment, medical treatment, education, elderly care, social security, amid other issues. Constant progress has been made in the process. Last year, new jobs were offered to 870,000 people, and the per capita disposable personal income in urban and rural areas grew 8% and 8.9% respectively. In the first quarter this year, new jobs were offered to 266,000 people, and the per capita disposable personal income in urban and rural areas grew 7.9% and 8.9% respectively. These have made people feel more satisfied than before. 

Third, there has been an intensification of the efforts in discipline, and improving reforms to streamline administration, delegate powers and improve regulation. We established a bureau responsible for administrative examination and approval. Services are offered online and in the service hall. Examination and approval powers are now in the charge of one department, while law enforcement power goes to another. Enterprises and the general public can enjoy one-stop services both online and offline. A total of 70 issues previously subject to administrative examination were cancelled. No government administrative fees were levied in the province. We welcome all media outlets to supervise us, and inform us of any malpractices. No tolerance will be given to those violating rules. We will also fully implement the policies on reducing taxes and fees made by the Party central committee and the State Council this year, and try our best to achieve real results. Negligence of duty and malpractice will be severely punished. Last year, we investigated 7,972 cases related to the "Four Malfeasances," in which 9,184 people were held accountable. In the first four months this year, we probed 925 similar cases, in which 1,211 people were held accountable. These efforts have greatly improved officials' performance, made them more active in taking responsibilities and carrying out works, and protected their enthusiasm, initiative and innovation in serving enterprises and the people. Meanwhile, Party committees and governments at all levels have taken their own responsibilities in protecting officials who are deligent and daring in work. An incentive system and a sound environment have been created. 

Improving the business environment is our approach to implement new development philosophy and achieve the Party's objectives. It marks a revolution in our own established practices. It is an effective measure to improve reform and opening up, and improve law-based governance. It is also a long-term mission in which we have only achieved some preliminary results. Improving the business environment is a task that will never end, as there will be new needs in new eras. We will work harder and never stop our efforts in this field. We also welcome you to watch over our work, find our errors, and give us advice. Thank you. 

Guangming Daily:

According to the Report on the Work of the Government of Hebei Province released at the second session of the 13th People's Congress of Hebei Province this January, a total of 20 livelihood projects will be implemented this year. Could you give an update on the progress of these projects in Hebei? 

Xu Qin:

Thank you for your interest in the "two sessions" of Hebei Province. People's livelihood is their deepest concern, and this is of greatest significance in our work. The Party Committee and the government of Hebei province has always stayed true to the vision of people-centered development, and it is our due responsibility to enable the people to share the benefits of reform and development. Since last year, together with all of our cities and counties, our provincial government has put forward a total 20 key livelihood projects. In addition, more regional livelihood projects have been initiated by local city and county governments. We are always committed to ensuring and improving people's livelihood. Regarding your question, our 20 livelihood projects focus on the following four aspects: 

The first focus is infrastructure and basic living situations, including the infrastructure renovation of run-down urban areas, dilapidated rural houses, outdated and overused pipelines, just to name a few. The second is improving the standard of public services, such as the service on employment, public culture, public facilities and schools in rural areas, and many others. The third is safeguarding people's basic living standards by, for example, developing community-based and at-home elderly care; financially supporting people with disabilities who are living in poverty; improving sanitation and so on. The fourth focus is the ecological environment, including adopting clean energy sources for winter heating, improving management of household refuse in rural areas, renewing the living environment in rural areas and many others. All of the abovementioned measures are closely tied to people's daily lives. Although these projects can be divided into different fields, they share a single goal, which is to improve people's well-being. People's welfare is never too trivial to address, as our Party committee and the government of Hebei province has attached great important to it, sparing no effort in the implementation of these projects. This is also our endorsement to practice General Secretary Xi Jinping's important instructions to "ensure and improve people's livelihood with more commitments and practical measures." Our 20 livelihood projects were approved by the secretary of Hebei Province party committee, and passed after thorough discussion by the standing committee of the provincial party committee, the government executive committee and the "two sessions" of Hebei province. During the implementation process, specific requirements, including the leading team, schedules and routes of the projects have been made in order to make sure that these projects are successfully completed. 

Following are some statistics for your reference. Regarding the progress of the 20 livelihood projects in the first quarter of this year, a total of 266,000 jobs have been created, which is an increase of 11,000 jobs over the same period of last year. In run-down urban areas, 24,000 houses have been renovated, which accounts for 63.8% of the annual task. Renovations have been completed on 46,900 dilapidated rural houses, which accounts for the 95.3% of the total number. Some 2064 renovation projects in outdated neighborhoods have been launched, reaching 74% of the plan total. In terms of community-based and at-home elder care, before the end of the 2019, 90% of the subdistricts in main urban area will have at-home elder care centers. As for school-building in rural area, we have started construction of 191 small-scale schools and county-based boarding schools, the area of which covers 360,000 square meters. In health sector, the pilot management system have been fully implemented in 213 provincial modern hospitals, and will cover 50% of the province's total by the end of this year. Tangible benefits in the public culture service sector have also been brought to people of Hebei. These figures demonstrate the promising prospects of our livelihood projects' implementation in the first quarter of this year. We will further the implementation of these projects in the coming three quarters to ensure high-quality and efficient completion of the livelihood projects.

Hu Kaihong:

That's the end of the Q&A section. Now I'll give the floor to Mr. Wang for some closing remarks. 

Wang Dongfeng:

I would like to express my sincere gratitude to the SCIO and all the friends from the media for your understanding and support of Hebei in its development. On behalf of the CPC Hebei Provincial Committee and the Hebei provincial government, I invite you to visit Hebei. We are ready to offer you our services. Thank you. 

Hu Kaihong:

This concludes today's press conference. Thank you, Mr. Wang. Thank you, Mr. Xu. Thanks to all. 

By Li Xiaohua, Chen Xia, Mi Xingang, Gong Yingchun, Zhang Jiaqi, Cui Can, Zhang Liying, Zhang Rui, Li Jingrong, Zhu Bochen, Li Yang, Wu Jin, Wang Qian, Huang Shan, Zhou Jing, Zhang Junmian, Wang Wei, Yuan Fang, Wang Yanfang, Li Huiru, He Shan, Li Shen, Jennifer Fossenbell, Geoffrey Murray, Jay Birbeck, Laura Zheng

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Read in Chinese

Speakers:
Xu Lin, deputy head of the Publicity Department of the Communist Party of China (CPC) Central Committee, minister of the State Council Information Office (SCIO), vice president of the CDAC organizing committee and executive committee;

Kong Xuanyou, vice minister of foreign affairs;

Zhang Xu, vice minister of culture and tourism;

Du Feijin, member of the Standing Committee of the CPC Beijing Committee, head of the Publicity Department of the CPC Beijing Committee

Chairperson:
Guo Weimin, vice minister of SCIO

Date:
May 9, 2019

The State Council Information Office of China invites four officials to brief the media about the Conference on Dialogue of Asian Civilizations in Beijing, May 9, 2019. [Photo by Liu Jian/China SCIO]

Guo Weimin:

Ladies and gentlemen, friends from the media, good morning. Welcome to this press conference. The Conference on Dialogue of Asian Civilizations (CDAC) is to convene soon and has drawn great attention from Chinese and foreign media. Today, we hold this press conference to brief you on the CDAC. 

Present at this conference are: Xu Lin, deputy head of the Publicity Department of the Communist Party of China (CPC) Central Committee, minister of the State Council Information Office (SCIO) and vice president of the CDAC organizing committee and executive committee; Kong Xuanyou, vice minister of foreign affairs; Zhang Xu, vice minister of culture and tourism; and Du Feijin, a member of the Standing Committee of the CPC Beijing Committee and head of the Publicity Department of the CPC Beijing Committee. They are all vice presidents of the CDAC executive committee, and I'm honored to be a vice president too. 

Mr. Xu will offer an introduction first, and then the four gentlemen will answer some of your questions. Now I'll give the floor to Mr. Xu.

Xu Lin:

Good morning, ladies and gentlemen. The Conference on Dialogue of Asian Civilizations (CDAC) will be held in Beijing on May 15. First of all, on behalf of the preparatory committee of the CDAC, I would like to welcome all our friends to today's press conference and express my heartfelt thanks to all those who care about and support the CDAC.

In recent years, President Xi Jinping, in his attempts to build a beautiful world and a community with a shared future for mankind, has put forward a series of important ideas and expositions on strengthening exchanges and mutual learning among different civilizations, which have produced positive responses from the international community. At the Conference on Interaction and Confidence Building Measures in Asia, held in Shanghai in 2014 and the 2015 Boao Forum for Asia, President Xi Jinping twice advocated for the convening of the CDAC, and received positive responses from the participating countries. Since then, China has carried out multi-level and interdisciplinary dialogues and cultural exchanges with the relevant countries in Asia and around the world, creating good conditions for holding the CDAC. The convening of the CDAC implements President Xi Jinping's initiative. It also further promotes exchanges and mutual learning among civilizations in Asia and the rest of the world, and encourages us to achieve common progress.

The Chinese government attaches great importance to the CDAC. President Xi Jinping will attend the opening ceremony of the CDAC, deliver a keynote speech, and attend relevant activities.

The Conference on Dialogue of Asian Civilizations is another important diplomatic event following the Second Belt and Road Forum for International Cooperation and Beijing International Horticultural Exhibition. It will be a landmark international event. I would like to summarize the conference with the ensuing five points:

First, the theme is clear. The theme of the conference is "Exchanges and Mutual Learning among Asian Civilizations and a Community with a Shared Future", which reflects important philosophies articulated by Chinese President Xi Jinping. These include exchanges and mutual learning among civilizations, the establishment of an Asian community with a shared future and building of a shared future for mankind. The conference not only reflects the general hopes and wishes from Asian countries but also those of the entire world. The activities of the conference are designed and developed around this theme.

Second, the response has been enthusiastic. More than 2,000 people, including government officials from 47 countries in Asia as well as from outside the region, plus representatives from the fields of culture, education, film and television, think tanks, media and tourism, will attend the opening ceremony and sub-forums. Entertainers, artists and people of all walks of life from Asian countries and other countries in the world will participate in Asian Culture Carnival, Asian Civilization Week and other events. The conference organizers also invited leaders of Cambodia, Greece, Singapore, Sri Lanka, Armenia and Mongolia, as well as officials from UNESCO and other international organizations to attend the conference.

Third, the conference boasts diversified events, including the opening ceremony, sub-forums, Asian Culture Carnival and Asian Civilization Week. Leaders from China and foreign countries, as well as heads of international organizations who participate in the conference, will share and explore ideas through exchange and mutual learning among Asian civilizations. In additional, the conference has six parallel sub-forums, inviting government officials, experts and scholars, and those engaged in particular fields to join discussions. A grand Asian Culture Carnival will be held, with more than 30,000 people from home and abroad expected to attend. In order to showcase diversified Asian civilizations, Asian Civilization Week will be held, including events like Asian Civilization Parade, Asian Culture Festival, Asian Culture and Tourism Exhibition, Asian Film and TV Week, and a Joint Exhibition of Asian Civilizations. Meanwhile, an Asian Cuisine Festival will be held simultaneously in the cities of Beijing, Hangzhou, Guangzhou and Chengdu.  

Fourth, we will provide an effective guarantee. This year's conference has a large number of participants and a long duration. We are striving to create a first-class conference environment and provide warm and thoughtful services to all participants. At present, the official website of the conference has been officially launched and all kinds of important information related to the conference will be published on that site. Beijing has recruited more than 3,700 volunteers to provide services to participants. At present, more than 2,800 Chinese and foreign journalists have signed up for the conference. The conference has set up a news center and will hold a series of news release activities to provide services for journalists.

Fifth, the conference is expected to achieve a fruitful outcome. Some documents will be issued based on the major consensus reached during the conference, which will showcase the fruitful outcomes of the conference, and present a bright and prosperous future of the exchanges and mutual learning among Asian civilizations and other civilizations in the world. At the same time, a series of multilateral and bilateral initiatives and agreements will be signed in various fields, such as media, think tanks, tourism, films and television, cultural heritage protection, etc. The results of some major projects and research reports will be announced during the conference. Concrete measures will be proposed to implement the conference outcomes and advance exchanges and mutual learning among civilizations. 

President Xi Jinping said that our civilizations have become richer and more colorful through exchanges and mutual learning. We believe the CDAC will present a rich and colorful display of Asia's civilizations to the world. We will warmly welcome guests from all over the world. On behalf of the conference's organizing committee, I would like to sincerely invite you, friends from the press, to cover the grand event, spread the beauty of civilizations, and join our efforts in making the conference a success. Now, my colleagues and I are ready to take your questions. Thank you.

CCTV:

Mr. Xu's introduction let me see that the Conference on Dialogue of Asian Civilizations is a large-scale event that is rich in content and plural in forms. It is fair to say that the world will focus its attention on Beijing again. In your opinion, what are the main highlights and characteristics of this event? Thanks.

Xu Lin:

The CDAC will show Asian civilizations' charms, and promote exchange and mutual learning of all civilizations in the world. The event's broad participation and rich content were already shown through my introduction. I would like to summarize its highlights and characteristics in four aspects as follows.

First, it grips the theme and responds to questions of the times. Among different civilizations of modern world, should the relations be conflict or dialogue, confrontation or cooperation? The answers to these questions concern humanity's future and fate, and these are also questions of the times concerning the development of human civilizations. The conference's theme is "Exchanges and Mutual Learning among Asian Civilizations and a Community with a Shared Future." The conference will follow the theme, follow the overall trend of cooperation and development, carry forward the people's wishes for civilization exchange and organize in-depth discussions on the diversity of Asian civilizations, as well as the mutual learning and exchange between these civilizations. In this way, it will further explore the importance and meaning of civilization exchange to the construction of a community of shared future for mankind, and build a bridge connecting the hearts of different peoples.  

Second, it shows the concepts of inclusiveness and common progress. The conference is based on Asia but it faces the world. It is related to all countries of Asia and open to all civilizations in the world. It invites representatives of all 47 Asian countries, who are from the circles of literature, arts, film, cultural relics, think tanks, media and youth. The conference also invites representatives from outside of Asia, which builds a good platform for mutual exchange and mutual learning of different civilizations so that they can make progress together.

Third, the conference shows the diversity of civilizations, which are colorful and can coexist in harmony. The event consists of an opening ceremony, panel discussions, the Asian Culture Carnival and Asian Civilization Week, which involves more than 110 activities that will demonstrate the diversity and charm of Asian civilizations, as well as the profound historical background of the Chinese civilization and the exchange and integration of Asian and world civilizations. The Asian Culture Carnival can be regarded as a highlight of the conference, which is based on the concept of inter-connectivity and the shared future of Asia, and will present the world with a great event on civilization, featuring grand exchange of Chinese and foreign civilizations, grand integration of different cultures and a grand gala of different peoples. 

Fourth, the conference highlights the principle of broad participation. It is oriented to the needs of the people, pays attention to attracting public participation and strives to improve people's sense of participation, experience, benefit and happiness. The well-designed Asian Culture Carnival and Asian Civilization Week will present many public lectures, square performances, shows and exhibitions at affordable ticket prices, as well as films to meet the needs of people's spiritual and cultural life and expectations of the future. We have also strived to arrange a proper time for the gourmet festival activities to meet the needs of the people and attract more people to participate into them.

We also expect that you reporters can come to take a look at the civilization cruise, and relevant exhibitions and shows, and sample foods from around Asia to experience the diversity of Asian civilizations. It is believed the conference will provide the world with collective participation, dialogues of plural civilizations, colorful cultural exchange and lively cultural experiences. It will leave an important mark on the history of human civilizations exchange. Thank you. 

China Arab TV:

Recently, the second Belt and Road Forum for International Cooperation was successfully held in Beijing. President Xi Jinping said that China will build the Belt and Road Initiative into a road of peace, prosperity, openness and innovation and a road that brings together different civilizations. What does the theme of the Conference on Dialogue of Asian Civilizations have in common with President Xi's proposal ?

Kong Xuanyou:

Dialogue between civilizations and cultural exchanges are a major component of the Belt and Road Initiative. At the second Belt and Road Forum for International Cooperation concluded just now, President Xi stressed that we need to actively build bridges for cultural exchange and mutual learning. He also said that we needed to deepen cooperation in education, science, technologies, culture, sports, tourism, health and archaeology, in order to facilitate multi-faceted people-to-people exchanges.

The Belt and Road is not only a road to development and prosperity, but also a road to the integration of civilizations. Historically, the Silk Road was not only a way of trading goods, but also a major artery of exchanges between civilizations. It spread right across the Egyptian, Babylonian and Indian civilizations, and hosted the gathering places of Buddhist, Christian and Islamic believers. It also crossed the settlements of peoples of different nationalities and colors. Different civilizations, religions and races were able to seek common ground while reserving differences, and together wrote a great poem of mutual respect and painted a beautiful picture of common development.

The holding of the Conference on Dialogue of Asian Civilizations can be said to be a positive attempt to promote the construction of a road that brings together different civilizations along the Belt and Road routes. We should uphold the ideals of peace and cooperation, openness and inclusiveness, mutual learning, and the pursuit of win-win solutions. We should transcend civilization barriers through exchanges, transcend civilization conflicts by mutual learning, and transcend the sense of superiority by coexistence of civilizations. We should promote mutual understanding, respect and trust. We hope the Conference on Dialogue of Asian Civilizations will further enrich the cooperation concept of the Belt and Road Initiative, and write a new chapter of Belt and Road cooperation. Thank you.

BTV:

I have noticed that Beijing will hold a series of activities like parades and food festivals during the conference. A lot of people would like to participate in these activities. Could you please share how you will guarantee people's participation? Thank you. 

Du Feijin:

Thanks for your question. By drawing upon the successful experiences in facilitating large-scale international conferences and activities, we have carefully designed the Asian Civilization Parade and the Asian Cuisine Festival in accordance with the principle of facilitating people. We will introduce a series of measures to make sure local people can participate in the events, through which Beijing citizens can experience other Asian civilizations, cultural exchanges and the festive atmosphere. It will be a civilization festival featuring culture, food and technology.  

The civilization parade and cuisine festival will be held simultaneously in the central area of the Olympic Park between May 16 and May 22. The parade, which features the distinctive cultures of Asian countries, comprises four parts including "Beautiful China," "Colorful Asia," "Shenzhou Charm" and "Beijing Welcomes You." A performance will be staged at 10 a.m. and 4 p.m. each day, allowing an audience of about 13,000 per day. We have invited 28 well-known performance groups from home and abroad to the parade. In addition, we have arranged for parade buses and a graffiti wall featuring Asian cultures.

The cuisine festival will feature 14 exhibitions & taste activities at the main venue, with additional food festivals at six shopping malls across the city with over 200 domestic and foreign food companies participating. Eight exhibition areas will be established at the main venue to display three major Asian food cultures: "taste," "technique" and "tableware." Apart from the wonderful parade performances, visitors will have the opportunity to take a taste of food from countries like Thailand, Singapore, Malaysia and Japan. At the exhibition areas of "Food Technology and Inheritance" and "Modern Smart Cuisine," visitors can experience via VR and AI technologies the smart services in today's food industry and get a sense of the changes that traditional industries have witnessed thanks to modern technology. 

Food festivals will be simultaneously held in six malls across the city including China World Mall, Solana, Hopson One, Chaoyang Joy City, Golden Resources Mall, and Wukesong Huaxi Shopping Center. Asian food restaurants will be encouraged to hold sales activities to attract more citizens to enjoy the festivals. By a conservative estimate, the food festivals will reach at least one million people. In order to benefit the people, activities like Asian Food Week will be launched with the help of multiple internet platforms during the cuisine festival. Online promotions such as red envelopes discounts, group buying for characteristic dishes and Asian food restaurants recommendations will be introduced.

The parade and cuisine festival at the main venue are open to invited guests as well as the public through online booking. 7,000 tickets per day will be dished out online. Those who are interested in the event can book tickets online. We hope that the media can help report the event in advance and your coverage will attract more people to these events. Thank you! 

Strait Times:

We have noticed that some people believe China is trying to use this conference to expand its influence. Is China trying to unite Asian civilizations to respond to the pressures from the West?

Xu Lin:

First of all, I want to emphasize that we hold the CDAC not to provoke confrontation between different civilizations, but to promote dialogue, mutual learning and common progress. We have noticed the views on the international stage. Some people are trying to draw the public attention to the so-called competition, conflict, or confrontation between the East and the West. If people believe this because of some misunderstanding, it proves that a dialogue between different civilizations is necessary, valuable and meaningful. But if people spread such views out of ill intentions, trying to provoke conflict and confrontation, then they will lose public support and are doomed to failure.

From the development of China's 5,000-year-old civilization, we can determine that the Chinese civilization is deeply rooted in our land, and has been enriched by other civilizations through communications. The ocean is vast because it admits hundreds of rivers. Throughout our history, we have pursued harmony in diversity and pursued mutual enrichment. We have lived harmoniously with other civilizations, learnt from each other through dialogue, and sought progress together. The world consists of many colorful civilizations, which are equal and inclusive. Regarding different civilizations, we believe in the notion that all countries should respect the interests of others while pursuing their own, and should advance the common interests of all. To show respect to the diversity of civilizations, we should first respect, cultivate and develop our own civilization. Meanwhile, we should respect and appreciate other civilizations. We should pursue common progress through dialogue, integration and mutual learning. Joint efforts to this end will surely promote the sustained peace, prosperity and development of our world, thus building a community with a shared future for mankind.

From the history of human development, wheat was first planted on the Anatolian Plateau in the Euphrates and Tigris rivers basins, rice was first planted in the Yangtze River basin in China, while cotton was developed in the Indus and Ganges. These beginnings and fruits of different human civilizations have become crucial material bases for human survival thanks to exchanges and sharing. That is an example of exchanges, mutual learning and sharing among civilizations. 

China not only advocates cultural exchanges and mutual learning, but also works to promote such exchanges. President Xi Jinping proposed on many important international occasions that different civilizations should pursue inclusiveness, mutual learning, and draw on each other to achieve common progress. The purpose of this conference is to provide a platform to spread progress and carry forward the achievements of the civilizations of Asia and the world, while promoting exchanges and mutual learning among different countries and civilizations, so as to advance the development of human civilization and build a community with a shared future for mankind. In my opinion, it demonstrates that China has lived up to its responsibility as a major country in terms of promoting world peace and development and the building of a community with a shared future for mankind. Thank you.

Sri Lanka Mirror:

Mr. Zhang, it was mentioned just now that a total of 47 countries will participate in a series of cultural tourism activities to be held during the event. Would you please give more details about these activities? Thank you. 

Zhang Xu: 

I am very glad to answer your question. The Ministry of Culture and Tourism is mainly responsible for coordination and implementation of activities under the conference's framework such as the parallel sessions of Culture, Tourism and People-to-People Exchanges, and the Asian Civilization Week, which includes an Asian Cultural Tourism Exhibition, Asian Civilization Joint Exhibition (cultural relics and art exhibitions), and Asian Cultural Performances. The ministry will also assist the China Media Group and Beijing Municipality in hosting the Asian Cultural Carnival and Asian Civilization Parade.

The parallel sub forum on Culture, Tourism and People-to-People Exchanges will be held at the National Convention Center on May 15. At Present, around 120 foreign guests have confirmed their attendance to the event, including former Deputy Prime Minister of Thailand Phinij Jarusombat, who will also make keynote speeches during the session. The Asian Culture and Tourism Exhibition will be held from May 16 to 18. Travel agencies from 31 Chinese provinces (autonomous regions and municipalities) and 23 other countries and regions will participate in the exhibition, with the number of representatives reaching 160 and 200, respectively. Cambodia and Laos will attend the conference as Guests of Honor. A series of events will also be launched during the exhibition, including the Asian Travel Agencies Conference, Chinese Cultural Tourism Promotion Seminar, Asian World Heritage Image Exhibition, and the Asian Cultural Tourism Products Fair. The Asian Civilization Joint Exhibition includes cultural relics and art exhibitions. The art exhibition consists of one main exhibition and four smaller ones. The main art exhibition will be opened at the National Art Museum of China on May 10. Four other sub-exhibitions, covering the themes of intangible cultural heritage, digital art, oracle bone script and literature, will be held at different museums across Beijing. Amongst the sub-exhibitions, the one named The Memories in Oracle Bone Script is a permanent exhibition. Some of you may have already seen it. The other three will be launched during May 7 and June 13. The cultural relics exhibition will be opened at National Museum of China on May 13. Some 300 artifacts from more than 20 Asian countries will be displayed. The Exhibition of Treasures from National Museums along the Silk Road will also be presented as a part of the CDAC event. The Asian Cultural Festival is scheduled to raise the curtain on May 14 with the debut of Ballet Gala of Asia at Beijing Tianqiao Performing Arts Center. It will be jointly performed by artists from China's Hong Kong, Japan, South Korea and the Philippines. Later, the audience will enjoy an audio-visual feast in a series of colorful and diversified activities, including concert, drama, dance and etc. Moreover, the Ministry of Culture and Tourism has invited foreign artists to join in the Asian Cultural Carnival and the Asian Civilization Parade. About 750 of them will perform in the Asian Cultural Carnival, and 480 others in the Asian Civilization Parade. That's all for my introduction. Thank you. 

Kyodo News:

Japan and China are two important Asian civilizations. The leaders of the two countries recognize that notable progress has been made in improving bilateral relations over the past few years. In your opinion, how will their relations influence the exchanges among Asian civilizations? And what does China expect Japan to do to maintain the momentum?

Kong Xuanyou:

Mr. Xu just introduced the background and significance of the conference in detail. Focusing on Asia while facing the world, the conference will present the outstanding achievements made by different Asian civilizations, while also showing diversified world civilizations as a whole. These should be the purposes of the conference.

It is obvious that, with two-thirds of the world's population, over 1,000 ethnic groups and a total of 47 countries, Asia has a glorious history of interconnection among different civilizations, including Islam, Christianity, India and China. Therefore, Asia represents a region where different civilizations exist in harmony. And we believe Asia is capable of spearheading the exchanges and mutual learning among different civilizations.

However, Asia cannot make headway and embrace a promising future without paying due attention to the major trends in global development. Therefore, the conference is designed to be inclusive of civilizations outside Asia and embracing friends from different regions all around the world. Actually, other than the 47 Asian countries, we have invited prestigious scholars and important guests from nearly 50 non-Asian countries to join us in relevant events of literature, arts, think tanks, media and youth work. They come from countries in Africa, Europe, the Americas and Oceania.

China and Japan have a history of more than 2,000 years of friendly exchanges. Jianzhen, an eminent Chinese monk of the Tang Dynasty (618-907) who travelled to Japan to preach Buddhism, and Abe no Nakamaro, a Japanese scholar who studied in China during the Tang Dynasty and subsequently died in the country, are vivid examples of the cultural linking between the two countries. They left much of valuable thought and ideas for both sides, which have been passed down and inherited by numerous generations.

Through the joint efforts of China and Japan, bilateral relations have returned to normal and achieved new development. In the new historical era, exchanges between the two civilizations and mutual learning will be conducive to further tapping the similar genes in regard to our cultural relations, deepening mutual understanding, trust and friendship between the two peoples, and opening up better prospects for further development of bilateral relations.

We sincerely hope that China and Japan will join hands and work together in proposing new ideas for partnership in win-win cooperation, and create a new situation of exchange and mutual learning between Asian and world civilizations. The beneficial explorations and practices of both sides will help further substantiate the connotation of a community with a shared future for mankind. Thank you.

Phoenix Satellite TV:

You have mentioned the conference is on a rather large scale with a vast number of participants, and this may present some challenges in terms of service. My question is: How will you seek to solve such problems? What specific measures will you take? Thank you.

Du Feijin:

Thank you for your question. As you said, the conference features high level, large scale, rich contents and diversified events and extends over a long period. Providing excellent service for such a conference is an important task the central authorities have given to Beijing. It shows the central authorities have full trust in us. We have made intensive efforts to plan, organize and coordinate related works, so as to provide sound service over a full range, including publicity, reception, transportation, security, venue preparation, environmental protection, volunteer services, safe production, food safety, air quality improvement, and good healthcare. Generally, our efforts can be divided into three aspects.

First, effective efforts have been undertaken to organize and support the conference. All related departments under the municipal government are meeting the strictest requirements in organizing and supporting the many tasks, such as examining and building conference venues, producing and distributing passes, arranging hotels for guests and journalists, designing and decorating the streets, improving the environment, preparing vehicles for the conference, hiring and training volunteers, and establishing medical teams. Sound services will be provided in all areas, including dietary requirements, accommodation, transportation, organizing events and overall security.

Second, effective efforts have been undertaken in regard to the important work. The carnival is a major event and a special activity of the conference. The construction of the carnival stage is challenging, with high requirements in regard to power supply. All concerned departments have worked hard to ensure smooth construction of the stage through close communications and coordination. On April 15, a power transmission capability of 11,200 kW was ready at 56 spots. On April 22, the stage was completed. On April 27, a rehearsal of all performers, including extras, was held in the National Stadium.

Third, we fully intend to provide final solutions to every single challenge that might arise. In addition to the support services to safeguard the smooth running of the event, we are responsible for maintaining good order among the spectators and visitors expected to watch the relevant parades or attend gourmet festivals. The preparatory work has been difficult since it involves many different jobs at spots over long distances and covering a great number of areas. However, with the concerted efforts taken by the various parties involved, we have managed to address the most daunting challenges properly, such as where and how the figurants can rehearse, how to plan the pedestrian and traffic flows, how to guide the performances of overseas troupes and where to fix and how to arrange the main areas of gourmet festivals.

To provide convenience to the media, we have established eight functional blocks, including a comprehensive service area, a press conference center, open media workplace, exclusive media workplace, monitoring center, cultural exhibition center, a catering area and a tearoom, at the conference news center. This has all the facilities needed for broadcasting, a good office infrastructure and a high-speed Internet network enabling journalists to fully cover the event and work in cozy surroundings.

I would also like to take this opportunity to express my gratitude to our citizens in Beijing for their great hospitality and a strong sense of participation. They have given us substantial support and shown deep understanding in every major event held so far this year. Their active involvement, as a result of their broadminded attitudes, hospitality, openness, inclusiveness and indifference to fortune and fame, has demonstrated the great legacy of this unique city. Therefore, please allow me to show my sincere admiration to all. Thank you for your question.

China Daily:

Mr. Zhang, you have just now mentioned that a series of colorful cultural and tourism activities will be held during the conference. What significance do these activities have in boosting the cultural exchange and cooperation between China and other Asian countries? Thank you.

Zhang Xu:

As we know, Asian countries have long histories and diversified cultures. The birth and development of Asian civilizations have made positive and important contributions to the development of world civilization, and serve as a main force in maintaining world peace and harmony. Under the background of globalization, it is imperative that countries in Asia join hands to deal effectively with constantly arising cultural conflicts and other new challenges. In March 2014, Chinese President Xi Jinping delivered a speech at the headquarters of the United Nations Educational, Scientific and Cultural Organization (UNESCO) in Paris. In his speech, Xi elaborated both broadly and profoundly on his views and propositions regarding exchange and mutual learning among human civilizations, putting forward that "civilizations come in different colors, and such diversity has made exchange and mutual learning among civilizations relevant and valuable; civilizations are equal, and such equality has made exchange and mutual learning among civilizations possible; civilizations are inclusive, and such inclusiveness has given exchange and mutual learning among civilizations the needed drive to move forward." Xi's speech pointed to our current direction in seeking approaches to address the problems facing human society today.

The cultural and tourism activities under the framework of the Conference on Dialogue of Asian Civilizations (CDAC) are very rich and colorful, and are highly participatory and interactive with cultural connotations. Through these activities, we hope the conference will further enhance cultural dialogue among Asian countries and promote exchanges between the Chinese cultural tourism industry and our Asian counterparts, so as to better improve the mutual understanding among Asian countries and strengthen win-win cooperation in the fields of culture, arts and tourism. 

Therefore, we firmly believe that by sharing the achievements of cultural and tourism activities within the framework of the conference, we will be able to further raise the importance of cultural diversity and cross-cultural dialogue to different countries. We hope to promote culture, artistic and tourism exchanges among different countries to enhance mutual understanding and people-to-people connectivity, and build an inclusive environment of mutual understanding to promote the coexistence and harmony between different ethnic groups and between mankind and nature, so that every country and culture will be able to play a positive role and become an important force to promote the sustainable development of human beings. Thank you.

Hong Kong Economic Herald:

I have a question for Mr. Xu Lin. What consensus will be reached at the conference? How do you evaluate the contribution of Asian civilizations to global civilization? Thanks. 

Xu Lin: 

The ultimate consensus of the conference is up to the participating members. As far as what we have seen, I believe there will be a positive consensus on mutual exchanges, mutual learning and common development between different civilizations. I am sure this conference will help translate the participating members' notions of civilization and then transform that into concrete actions based on equality, inclusiveness, exchanges and cooperation. The outcomes of the conference will relate to these areas. 

As we all know, Asia is of considerable significance to the globe in terms of population, nations and GDP. If we look at the development of the global civilization, the cultivation of wheat, rice and cotton was first seen in Asia. Ancient civilizations along the Nile, Tigris, Euphrates, Ganges, Indus, Yellow and Yangtze rivers have all made distinctive contributions to the history of human civilization. Asia itself is home to diverse civilizations which have co-existed, exchanged and learned from each other, and developed hand in hand, setting a good example to other regions and contributing a lot to the diverse development of the global civilization. Thank you.

Guo Weimin:

Today's press conference concludes. Thanks to all.

.

Read in Chinese

Speakers:

Shen Changyu, director of the National Intellectual Property Administration;

Zhao Gang, 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:

Shou Xiaoli, Press Bureau of the State Council Information Office

Date:

April 28, 2019

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to the press conference. April 26 this year was the 19th World Intellectual Property Day. China's protection of intellectual property has received great public attention. Today, we have invited Mr. Shen Changyu, director of the National Intellectual Property Administration, to introduce China's efforts to protect intellectual property in 2018, and answer some of your questions. Also with us today are Mr. Zhao Gang, vice director of the National Intellectual Property Administration, 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. Shou. Good morning, everyone. First, I wish to thank the State Council Information Office and all our friends from the press for having shown understanding and support for the work on intellectual property rights over all these years. General Secretary Xi Jinping delivered a keynote speech at the opening ceremony of the Second Belt and Road Forum for International Cooperation in Beijing, April 26, 2019. In his speech, Xi announced a series of major reforms and opening-up measures that China will take, stressing that China will intensify its efforts to enhance international cooperation in the protection of intellectual property. According to Xi, China will spare no effort to foster a business environment that respects the value of knowledge, fully improve the legal framework for protecting intellectual property and step up law enforcement. It will also enhance protection of the lawful rights and interests of foreign intellectual property owners, stop forced technology transfers, improve protection of trade secrets, and crack down hard on violations of intellectual property in accordance with the law. Xi's remarks further convey China's stance and attitude toward its efforts to fully protect intellectual property in accordance with the law to the international community. His remarks also provide principles and guidance for the development of China's intellectual property rights, which will be fully studied, grasped and put into practice.

Now, I will give you a brief introduction on the development of China's intellectual property rights in 2018.

In 2018, the CPC Central Committee and State Council elevated IPR protection to an level of importance that is unprecedented. General Secretary Xi Jinping emphasized in his keynote speech at the opening ceremony of the Boao Forum for Asia Annual Conference 2018 that IPR protection is the centerpiece of the system for improving property rights protection, and it would provide the biggest boost to enhancing the competitiveness of the Chinese economy. The State Council has made a series of important decisions on IPR protection. Over the past year, the departments of the Chinese government and local authorities have worked to implement a series of important decisions on IPR by the CPC Central Committee and State Council, so as to move faster to transform China into a country that is strong on intellectual property rights, and to ensure new progress can be made in all works.

First, we made stable efforts to transform China into a country that is strong on intellectual property rights. We earnestly implemented last year's plan on deepening the national IPR strategy and building China into a country that is strong on IPR. We started to formulate the Outline of the National Intellectual Property Strategy for 2035. We completed an evaluation of the implementation of the current version of the Outline of the National Intellectual Property Strategy as well as a mid-term evaluation on the plan for IPR protection and utilization in the 13th Five-year Plan Period (2016-2020). We also restructured the National Intellectual Property Administration, which is now also responsible for the administrative adjudication of patents, trademarks and geographical indications, while affairs related to copyrights are now administered by the Publicity Department of the Communist Party of China (CPC) Central Committee. The quality and efficiency of IPR examination continues to rise: The examination process for trademark registration has been cut to six months, and for high-quality patents the process has been cut by 10%. A total of 5.86 billion yuan in patent application fees was exempted or reduced over the past year. A national appeal court for IPR cases was inaugurated at China's Supreme People's Court so as to better strengthen IPR protection and management.

Second, the protection of intellectual property rights has been comprehensively strengthened. The draft amendment to the Patent Law passed the first review of the Standing Committee of the National People's Congress. The draft established a punitive compensation system for infringement and has greatly increased infringement costs. We have been actively promoting the revision of the Copyright Law and initiated the revision of the Trademark Law. The Regulation on Patent Agency and the Regulations on the Protection of New Varieties of Plants were revised. The Action Plan for the "Internet Plus" Intellectual Property Protection was formulated. A total of 38 ministries and commissions have carried out joint punishment for serious discredit conducts in the field of intellectual property (patents). The administrative law enforcement of intellectual property rights continued to strengthen, with 77,000 patent administrative law enforcement cases being handled, up 15.9% year-over-year. Altogether 31,000 trademark violation cases were investigated and handled, with a total case value of 550 million yuan. 2,500 infringement and piracy cases were filed and investigated. 3.77 million pieces of pirated products were seized, and 1.85 million infringing links were deleted. Customs at all levels detained altogether 44,550 batches of infringing goods. The number of infringing goods was 23.18 million, with a total worth of 200 million yuan. The courts of all levels received 301,279 first instance IPR cases, up 41.13% year-over-year. The public security organs of all levels registered nearly 28,000 cases of infringement and counterfeit crimes. Of them, 19,000 cases were solved, and 28,000 suspects were arrested. The case value amounts to 9.87 billion yuan. The procuratorates of all levels approved the arrest of more than 5,600 people who were involved in more than 3,300 IPR infringement cases. More than 4,400 cases involving more than 8,300 people were brought to public prosecution.

Third, the amount and quality of intellectual property creations have risen. We further implement the patent quality improvement project and trademark brand strategy, and severely crack down on non-normal patent applications and trademark preemptive registration and hoarding behaviors. The number of domestic invention patents (excluding Hong Kong, Macao, and Taiwan) reached 1.6 million pieces, an increase of 18.1% year-on-year. The ownership number of invention patents per 10,000 population reached 11.5 pieces, and the number of Patent Cooperation Treaty (PCT) international patent applications received and processed was 55,000, a year-on-year increase of 9%. The number of valid domestic trademark registrations reached 18.05 million, a year-on-year increase of 32.8%. The number of applications for international trademarks registration according to the Madrid Agreement Concerning the International Registration of Marks was 6,594, a year-on-year increase of 37.1%. A total of 2,380 geographical indication products and 4,867 registered geographical indication trademarks were approved. A total of 1,990 new varieties of agricultural plants and 405 new varieties of forestry plants were awarded, an increase of 34% and 153.1% respectively. The number of registrations of works and computer software copyrights reached 2.35 million and 1.1 million, an increase of 17.48% and 48.22% respectively. According to the Global Innovation Index 2018 Report published by the World Intellectual Property Organization (WIPO), China ranked 17th in the world and became the only middle-income economy to enter the top 20.

Fourth, the use of IPR has been greatly improved and is now more efficient. We have improved the national public service platform for the trading of IPR and launched IPR trading systems in 16 major cities. We have rolled out a set of measures to use IPR to promote the innovative development of private enterprises. The fund raised by pledging patents and trademarks totaled 122.4 billion yuan, up 12.3% year-over-year. We issued 40 golden awards to patents and external designs, and 20 golden awards to copyrights. We checked 8,179 enterprises for their use of geographic indication in products with a total output value of 1 trillion yuan. From 2016 to 2018, the export of IPR royalties reached US$11.51 billion, achieving the goal set in the 13th Five-Year Plan ahead of schedule.

Fifth, we have deepened the international cooperation on intellectual property rights. We hosted the 2018 High-level Conference on Intellectual Property for Countries along the Belt and Road, took an active part in multilateral activities under the framework of the World Intellectual Property Organization (WIPO) and the World Trade Organization. We have also enhanced cooperation with international organizations such as the International Union for the Protection of New Varieties of Plants, and improved international rules regarding intellectual property rights. Together with the WIPO, we established a Technology and Innovation Support Center. We tried to promote an earlier implementation of the Beijing Treaty on Audiovisual Performances, as 23 countries have either ratified or joined the treaty. We held the Global IP Protection and Innovation Development Conference during the first China International Import Expo. The number of China's partners in the Patent Prosecution Highway (PPH) program has increased to 28. China's valid patents have also been officially registered in Cambodia, and the results of our patent examination are recognized in Laos.

The above is the development of China's intellectual property rights in 2018. Now I'm ready to take your questions. Thank you.

Shou Xiaoli:

The floor is now open to questions. Please identify your media outlet before asking questions.

CCTV:

During the Second Belt and Road Forum for International Cooperation, President Xi Jinping said more efforts will be made to promote international cooperation on intellectual property protection. My question is for Mr. Shen. What is the current status of the cooperation on intellectual property protection under the Belt and Road Initiative? What will be done to improve the cooperation in the future? Thank you.

Shen Changyu:

Thank you for your question. As you said just now, during the Second Belt and Road Forum for International Cooperation, General Secretary Xi Jinping expounded on China's major principles and policies regarding intellectual property protection, and pledged to strictly protect intellectual property under the law, which has won international praise. The National Intellectual Property Administration is now working hard to study related issues and develop feasible and tailored measures to ensure an effective implementation of these policies.

Regarding cooperation in this field under the Belt and Road Initiative, we have cooperated with other departments and held the High-level Conference on Intellectual Property for Countries along the Belt and Road in 2016 and 2018 respectively. General Secretary Xi wrote congratulation letters for both meetings. So far, a regular mechanism for cooperation has been established to promote intellectual property protection under the BRI. Practical cooperation projects in eight fields, including communication on macro policies, intellectual property examination, development of fundamental capabilities, and exchange of information and data, have been carried out.

So far, steady progress has been made in every project, many of which have achieved significant results as a result of cooperation. For instance, the applications of patents and trademarks of China and countries along the route of the BRI are rapidly and continuously increasing. In addition, as I've mentioned, the validation of the patents authorized by China in Cambodia, and Laos' recognition of the results of the examination of Chinese patents, have greatly enhanced bilateral economic and trade cooperation, as well as technological and cultural exchanges. China has established a postgraduate program - a masters in intellectual property for students from countries along the route of the BRI, and students in the first class under this program have graduated. In addition, we have launched the portal for the cooperation of intellectual property under the BRI, which has access to our Patentcloud examination system. We agree to strengthen and build closer communication on global intellectual property issues in order to promote the development of open, inclusive, balanced and effective international rules of intellectual property, as well as to further support the joint construction of the BRI.

Next, we will put into practice the principles outlined in General Secretary Xi Jinping's keynote speech, and deliver more substantial and concrete outcomes of intellectual property cooperation under the BRI. The third High-Level Conference on Intellectual Property for Countries Along the Belt and Road will be held next year. And we will take the principles outlined in General Secretary Xi Jinping's keynote speech as our guide to review the progress of intellectual property cooperation projects in eight aspects in the past two years. On this basis, we will draw up a blueprint of the relevant projects and issues relating to intellectual property cooperation under the BRI in the upcoming conference. This will allow us to provide a better ecosystem of innovation to support technological exchanges and cooperation on a national-level in accordance with market principles and laws. Thank you. 

China Radio International:

Some reports say that among China's 10 million or more valid registered trademarks, some of them are malicious trademark registration and trademark hoarding, which have disturbed the standard registration procedure and violated the principle of fair competition. What measures will the National Intellectual Property Administration take to combat malicious trademark registration and hoarding? 

Shen Changyu:

Thanks for your question. We have done a lot of work in this aspect. Now, I would like to invite the deputy commissioner of the National Intellectual Property Administration, a trademark expert, to answer this question. 

Zhao Gang:

Thank you. Just as you mentioned, China ranks first in the world with its large number of registered trademarks. However, a small portion of the registration is driven by malicious intent, which we usually call them "malicious trademark registration." It has been divided into two categories. The first category is for people who register names of famous brands on irrelevant products or services or register some popular international brands in China. The second category is for people who register trademarks and then sell them for a profit. This is what we call the "hoarding of registered trademarks." The former type of malicious registration, which is clearly defined in relevant laws, has been effectively contained in recent years thanks to our great efforts to crack down on it. Regarding the hoarding of registered trademarks, however, in spite of principle provisions, law enforcement is difficult due to lack of direct, specific, and operable articles.  

In recent years, the former State Administration for Industry and Commerce and the newly restructured State Intellectual Property Office have paid close attention to and taken solid strides on the crackdown on hoarding registered trademarks for profit. In accordance with the Trademark Law, we declare the invalidity of a large number of hoarded trademarks that lie unused, especially those resembling famous registered trademarks. In some cases where trademark infringement cannot be dealt with through application or complaint processes, we will declare invalidity after registration in accordance with Article 44 of the Trademark Law. Both administrative organs and people's courts agree that a trademark can be canceled, if the holder has registered a large number of trademarks but is not using them. However, the implementation involves many challenges before registration.

Therefore, the Standing Committee of the National People's Congress revised the Trademark Law on April 23. As you may have noticed, the revision aims to stop at the source those registration applications that are not intended for use. The Trademark Office of National Intellectual Property Administration can directly reject applications during the review phase. If the Trademark Office of National Intellectual Property Administration fails to spot such cases during the review phase, as long as an objection is raised, the application can be stopped. Even if registration has been approved, it can be dismissed through another procedure. The procedure that determines whether the application is valid is very powerful. And the revised Trademark Law also stipulates that, for those who register a trademark maliciously, in addition to their trademark being rejected and invalidated, they may also face administrative penalties such as warnings and fines. I believe that after the revision, the Trademark Law will be more effective in combating behaviors such as hoarding of trademarks and malicious registration. In the next stage, we must also step up the development of supporting measures to ensure implementation of this revised Trademark Law. Thank you.

Science and Technology Daily:

Just now, Mr. Shen, you introduced China's intellectual property rights development of 2018. Could you please give more information on the achievements and progress made by our country in IPR protection? Thanks.

Shen Changyu:

Thank you for your question. IPR protection is crucial for the system to improve property rights protection, so our entire society pays close attention to this issue. In 2018, the achievements our country made in IPR protection were evident in the following areas.

First, the understanding of IPR has been deepened. Last year, General Secretary Xi Jinping emphasized in his keynote speech at the opening ceremony of the 2018 annual Boao Forum for Asia that IPR protection is the centerpiece of the system to improve property rights, and it would provide the biggest boost to enhancing the competitiveness of the Chinese economy. The statement leads us to a much deeper understanding on IPR protection and provides us with a fundamental principle.

Second, the duty of IPR protection has been optimized and readjusted. Through reform of institutions, the centralized management of trademarks, patents and geographical appellation of origin has been realized. The law enforcement team of the State Administration for Market Regulation is in charge of unified law enforcement on trademarks and patents. Meanwhile, the National Intellectual Property Administration is responsible for construction of the system to improving property rights protection, guidance of law enforcement for trademarks and patents and judging standards for patent and trademark infringement. All of these raise the effectiveness of law enforcement for IPR protection. 

Third, a punitive compensation system for IP infringements has been introduced, which demonstrates significant progress in this regard. This punitive compensation system has been specifically written into the draft amendment to the Patent Law, by which fines could be imposed up to five times for malicious IP infringement. In the recently-passed amendment to the Trademark Law, the max compensation limit for malicious trademark infringement was been raised to a quintupled level, which is a fairly high standard globally.

Fourth, the credibility and efficiency of IP examination has been enhanced, the notable progress of which was also been seen last year. During the first China International Import Expo in Shanghai in 2018, General Secretary Xi Jinping made a clarion call on the need for enhanced credibility and efficiency of IP inspection. The State Council has conducted certain deployments, noting that in the next five years, the time it takes to finish trademark inspections should be reduced from eight months to less than four months, an efficiency level which would rank top among the OECD countries. Also, examination times for inventions and patents should be reduced by one-third, while for high-value patents the time could be cut by half, which will mean a ranking of the most efficient in the world. All of these strategies will contribute to strengthening the protection of IP from its source.

Fifth, joint punitive mechanisms have been built. Together with another 37 departments, the National Intellectual Property Administration of China has built joint punitive mechanisms against bad faith in the fields of IP that maximizes continuous negative influence on businesses involved in IP infringement. The mechanism is said to be the strictest punitive measure in the history of IP, and has forcefully deterred the practice of IP infringement. I believe all of the points mentioned above constitute fundamental reform of IP protection in China, and they have drawn wide attention to different quarters of our society. Thank you.

HKTV:

The United States and some other western countries have accused China of not doing enough in cracking down on infringements. There are also cases of stealing and infringing intellectual property rights. May I ask Mr. Shen, what is your response to this? How do you view China's determination to crack down on infringement?

Shen Changyu:

Thank you for your question. First of all, I should say that some accusations about China's intellectual property protection are groundless. They have not seen the tremendous progress and achievements that China has made over the years in terms of intellectual property protection.

In fact, since the reform and opening up, especially since the 18th CPC National Congress, China has upped the ante in IPR protection, insisting on the equal treatment and protection of IPR of domestic and foreign enterprises. China has made great progress, which is recognized by the world. The U.S. intellectual property authorities and relevant media also said that China's IPR environment is at the forefront of developing countries and is becoming the preferred place for multinational corporations to initiate intellectual property litigation in global range. The reason they do so is because they believe that they can be treated equally in China.

It should be said that there's no limit in improving IPR. At present, there's still room for China to make improvements, and we are stepping up efforts to resolve these problems. At the same time, we must realize that the issue of intellectual property infringement is a worldwide problem. The issue exists in every country, only that different countries at different stages of development have different manifestations. All countries should strive to improve their business environment and solve their own problems.

Of course, apart from the efforts of individual countries, international cooperation is also needed to solve the problem of intellectual property infringement. We are willing to work with Western countries including the United States, to strengthen communication and cooperation in the field of intellectual property protection. We hope to work jointly to combat all kinds of infringements and create a good business environment, because strengthening IPR and cracking down on infringements are not only the need for fulfilling our international obligations but also the inherent need of China's implementation of innovation-driven development. Therefore, we must work together to promote a good international business environment and promote the prosperous development of the world. Thank you.

China News Service:

I want to ask Mr. Yu this question. The issue of film piracy during the Spring Festival this year has aroused widespread concern in society. What actions has the National Copyright Administration taken to combat piracy? In addition, what further governance actions will the National Copyright Administration take against such issues in the future? Thank you.

Yu Cike:

Thank you for your question. Chinese theaters screened eight domestic films during the Spring Festival, which were widely popular, and the films also set new box office records for the Spring Festival film season. However, it is true that the issue of film piracy has also triggered widespread concern in society. In order to maintain good copyright order and ensure the healthy and prosperous development of the film industry, the National Copyright Administration has taken many effective measures along with the State Film Administration, the Ministry of Public Security, the Cyberspace Administration of China, and the Ministry of Industry and Information Technology, strengthening copyright protection of theatrical film releases.

First, we cracked down rigorously on stealthy recording and the spread of piracy and infringement. The National Copyright Administration and the Ministry of Public Security formed a special task force to check 11 key provinces and cities such as Beijing and Jiangsu province, conducting case investigations, cracking down on covert recordings and various websites, apps and e-commerce platforms that spread pirated movies. Currently, we have cracked down on 22 major cases of pirated theatrical film releases with help from public security organs. Among them, we hunted down a major stealthy recording case in Yangzhou city, Jiangsu province, knocking out a criminal gang that pirates theatrical releases and arresting 52 suspects.

Second, we dealt quickly with infringing web links. We increased the monitoring of film piracy, carefully screened public reports, and quickly deleted unlawful information. Until now, we have deleted more than 30,000 links of pirated Spring Festival films, with help from the relevant government departments.

Third, we increased copyright pre-warning protection. Since March, the National Copyright Administration has released two lists of key released films protected by cinema copyrights, bringing 15 theatrical releases (including 7 overseas films) under our pre-warning protection, requiring relevant network service providers to take effective measures to deal with infringement and piracy in a timely manner.

Fourth, we promoted social co-governance of copyright protection. We promoted the establishment of a theatrical releases copyright protection alliance on April 26, World Intellectual Property Day, and guided producers, distributors and commercial websites to carry out copyright cooperation to take full advantage of collective action to protect IP rights.

Next, the National Copyright Administration will carry out special action on theatrical releases copyright protection, further increase efforts to crack down on infringement and piracy of theatrical releases, strengthen self-discipline and actions of rights protection in the film and television industries, and promote relevant internet enterprises to take the lead responsibility. At the same time, regarding the current situation that a large number of small piracy websites have servers located outside of China, we will strengthen cross-border law enforcement cooperation with relevant countries and regions to jointly crack down on internet infringement and piracy. Thank you.

Wall Street Journal:

China and the U.S. will hold trade talks next week. What kinds of progress in IPR protection will promote the bilateral talk? Is there any progress made that is targeted to the U.S. concerns? Are there any enforcement measures in place to guarantee more progress in IPR protection? Is it possible to say that China's potential progress in IPR protection will prompt the U.S. side to cancel its tariff toward China?

Shen Changyu:

Thank you for your question. The China-U.S. high-level trade talks are of concern in both countries, as well as in the international community. Not long ago, the two sides made new progress in the ninth round of negotiations, as they implemented the important consensus made by the two heads of state during their meeting in Argentina and held talks on the text of the agreement. IPR protection is an important part of that text, according to releases by related departments. I think their releases also cover the answers to your questions.

Since the country's reform and opening up, and especially after the 18th CPC National Congress, China has strengthened IPR protection and achieved recognizable achievements as it committed to provide equal treatment to domestic and foreign companies. It is fair to say that IPR protection is not only a focus of the China-U.S. trade talks and an issue of international concern, but also a necessity for China's wider opening up and its next step for innovation-driven development. This year, we will take further steps to comprehensively strengthen IPR protection, which may contain answers to your questions.

First, to improve related laws and regulations. We will promote amendments to the patent law and improve the punitive compensation system to significantly raise the cost to offenders. We will impose a fine of up to five times for serious IPR infringements, a high penalty compared to the international standard. The amendments to the Trademark Law that we just completed have increased the punitive compensation for serious trademark infringements.

Second, to strengthen the source protection system. We will improve the quality and efficiency of IPR inspections, cut the process for trademark and patent inspections, and provide timely authorization and sturdy rights. Stricter enforcement measures will also be taken to fight against abnormal patent applications, as well as unethical trademark applications and trademark hoarding. Mr. Zhao Gang already answered questions related to that topic.

Third, to improve law enforcement measures. We will strengthen our market supervision and law enforcement team, improve the judgement criteria for trademarks and patents infringements, and increase effectiveness of law enforcement.

Fourth, to improve the co-governance system. We will take joint punitive actions against serious violators. "Once discredited, violators will face restrictions everywhere." Like I just said, this is among the strictest punitive measures in IPR history.

Fifth, to improve the coordination mechanism to ensure quick authorization, confirmation, and rights protection. We will provide more efficient, easier and less costly channels to safeguard the rights of market entities. 

These works are essential to IPR protection and major concerns of the China-U.S. trade talks, and we are going to promote them throughout the year. Therefore, a large part of the trade talks coincides with what we are doing and will continue to do in the future. And we will strive to advance those related works. Thank you.

Guangming Daily:

World IP Day was celebrated on April 26 this year, with the theme of "IP and Sports." With the scheduled opening of the Winter Olympics in China approaching, my question is about the protection of IP for the Olympic Games. Would you please provide an overview of the pertinent issues?

Shen Changyu:

Thank you. The theme of this year's IP Day was "Reach for the Gold: IP and Sports," which, by my view, is a high integration of IP culture and athletic spirit. It has created a general environment tailored to the Winter Olympics and Winter Paralympic Games scheduled to be hosted in China in 2022.

Actually, IP is closely related to sports, which can be exemplified by the massive adoption of new high-tech in sports fields, upgraded facilities and new materials, many of which are patented products. In addition, copyright protections are highly relevant in the rebroadcast of sports events, brands of sports products, and the ability to generate increased profits from trademark protections.

The protection of IP rights at the Olympic Games has always been a big concern of China. As early as 2002, we issued "Regulations on the Protection of Olympic Symbols," which was amended last year. Regarding the Winter Olympics, we have greatly endeavored to protect its IP rights since China won the bid. We have launched all-around and multi-dimensional protections of the patent, trademark and copyright of the emblem, as well as related symbols.

In the next stage, we'll focus on the IP protection of the Winter Olympics in two underscored aspects. First, we'll endeavor to protect the IP rights of its torch and mascot. Second, we'll establish a system, particularly in Beijing and Hebei provinces, to report on and prosecute any violations relevant to the Games. Meanwhile, we'll also make growing efforts to crack down on any infringements to ensure a splendid Winter Olympics. Thank you.

People's Daily:

Mr. Shen, the Outline of National Intellectual Property Strategy released in 2008 might expire in 2020. So what are our next steps? Thanks. 

Shen Changyu:

Thank you for your question. I believe you are an expert in the field of intellectual property, especially in that you know IP strategy very well. In 2008, China issued the Outline of National Intellectual Property Strategy, which is the first strategy outline in its field. Since its implementation ten years ago, China's IP industry has achieved rapid growth and great results, showcasing the plan's leading role.

Last year, we completed a thorough review of the strategy's implementation. It revealed that the major goals and tasks designed for the year 2020 will be realized successfully, and some of them have already been met. A report of this review was published a few days ago, and provides a systematic display of the achievements made by implementing the strategy outline over the past 10 years. Generally speaking, progress was made in the following aspects:

First, the creation of IPR has been advanced in both quantity and quality, making China a major IPR country. Second, IPR protection has been strengthened and the environment for business and innovation has improved, leading to a steady increase in social satisfaction with IPR protection. Third, the utilization of IPRs has produced a powerful effect, offering a strong impetus for economic development. Fourth, a model of IP management based on China's national conditions has been established, and the performance of regulations and capacity of public services have seen a continual increase. In terms of international IPR cooperation, China has remained a strong defender, major participant and active builder of international trade rules. In addition, since the Outline of the National Intellectual Property Strategy was issued in 2008, public awareness of IPR protection has significantly improved. We have made considerable progress.

To ensure the continuity of the strategy's implementation, to ensure this strategy can keep playing a leading role, and guided by the "two-step" strategy adopted at the 19th National Congress of the CPC and the related policies developed by the State Council, we are working hard to formulate the Outline of the National Intellectual Property Strategy for 2035. We are trying our best to make our country more robust on intellectual property rights, and ensure the continuous implementation of the strategies on intellectual property. The first draft of the outline will be finished at the end of the year and we welcome the participation, support and attention from all parts of society till then. Thank you.

Shenzhen Satellite TV:

Last year, patent application cases in Shenzhen reached 228,600, or approximately 90 patented inventions per 10,000 people on average, nearly 10 times the number of the national average. Additionally, the city has taken the lead among mid- and large-sized cities in the number of applications for the Patent Cooperation Treaty (PCT) for 15 years in a row. At the same time, the "Regulations on IP Protection in Shenzhen Special Economic Zone" is the first comprehensive set of regulations for IP protection in the country. An IP tribunal was also established in the city's Qianhai area. Mr. Shen, how would you evaluate the city's achievements in patent application and IP protection? What's your opinion of the "Shenzhen phenomenon"? Thank you.

Shen Changyu:

Thanks for your questions. During the past few years, Shenzhen has indeed made notable progresses in creating, protecting, using and managing IP rights, particularly with its leading role in the number of PCT applications.

In my view, those achievements should be attributed to the strong creativity of the city, and local innovative entities are important driving forces. Secondly, they should be attributed to the intensive local awareness of IP protection, in support of which a slew of measures have been adopted there. More to the point, awareness of IP rights is strong in Shenzhen. Those factors combined have fueled the rapid development of local IP businesses.

As you said, the number of patent applications, especially those for the PCT in Shenzhen, has continued to boom, which is probably caused by local enterprises' international strategies for global business. Meanwhile, many local companies have developed well in the global market. They have paid substantial attention to international patent applications, which is highly relevant to corporate operations,. 

We hope the city can make more progress in regards to IP operation. Shenzhen is a model city in this particular sector country-wide, a competitive place for the IP industry and a pilot zone for experimental IP projects. We'll increasingly support it in its endeavors in IP development. Thank you.

China Intellectual Property News:

During the "Two Sessions" this year, some NPC deputies and CPPCC National Committee members suggested the amendment to the Patent Law should grant jurisdiction to the court for prosecution of patent invalidity, in order to address the issue of the long duration of patent prosecution. As far as we know, the National Intellectual Property Administration of China is responsible for the prosecution of patent invalidity. What's your opinion on this situation?

Shen Changyu:

Thank you for your question. Indeed, the issue was raised regarding the amendment to the Patent Law during the "Two Sessions" this year. We appreciate their attention to the amendment to the Patent Law. The prosecution of patent invalidity is a fairly professional and complex issue.

As you've said, currently the National Intellectual Property Administration holds responsibility for the prosecution of patent invalidity. Speaking from the nature of the Patent Law, judgment on patent invalidity in China is an important component of the administrative process of patent right confirmation. The procedure is a subsequent administrative oversight and error-correcting program for the earlier authorization and examination act, which is similar to a special kind of administrative reconsideration. Such a system is both a legally mandated duty of the National Intellectual Property Administration and an institutional arrangement that has lasted for decades in China. Also, such duty is practiced by the patent administrations of the majority of countries around the world. China is not the only case in this regard. 

Some experts believe that the long duration of patent prosecution is partly caused by judgment on patent invalidity. Patent prosecution indeed takes a long time, but the reasons for specific cases vary. I think one important reason is that patent cases are generally complicated and involve great technical complexity, thus increasing the difficulty of prosecution.

Some attribute it to the problem of system design, while others believe it's the result of "parallel system," which means that the determination of both patent right and the infringement are charged with different authorities. These type of opinions were discussed in articles and at meetings. However, it doesn't seem quite objective. According to the analysis of the statistics, 93% of the cases on patent infringement judged in 2018 are not influenced by invalid procedures. That is to say, the "parallel system" is not the pervasive factor causing the long period for patent protection.

Some people believe that circulation in patent litigation is another cause for the unreasonable delay in filing patent infringement litigation. This type of opinion also lacks evidence. According to the statistics from 2010 to 2018, only around 30 cases of invalidation application were caused by such reason, accounting for only 0.1% of the total during the same period. So, it is not the major cause for such delay.

However, it still requires more studies from various parties to find out the specific reason. Since we brought up the issue today, I'd like to brief you about China's examination on cases of invalidation application. Currently, China examines efficiently on cases of invalidation application. In 2018, it took 5.1 months on average to examine a case of invalidation application, the shortest in the world. About 97% of the cases of invalidation application will be resolved in the administrative procedures, which supports the intellectual property protection and is widely recognized by the relevant parties. 

Shou Xiaoli:

The press conference ends here today. Thanks to Mr. Shen and our guest speakers, and thank you, everyone.

By Li Xiaohua, Chen Xia, Li Xiao, Wang Yanfang, Guo Yiming, Li Huiru, Zhang Rui, Wu Jin, Zhang Liying, Zhu Bochen, Gong Yingchun, Wang Qian, Li Shen, Zhou Jing, Jennifer Fossenbell, Laura Zheng

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Read in Chinese

Speakers:

Xiao Weiming, director general of the Department of General Affairs at the Office of the Leading Group for Promoting the Belt and Road Initiative;

Song Lihong, director general of the Comprehensive Department at the Ministry of Commerce

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office of China

Date:

April 22, 2019

Hu Kaihong:

Ladies and gentlemen, good afternoon and welcome to this press conference. Today, the Office of the Leading Group for Promoting the Belt and Road Initiative (BRI) issued "The Belt and Road Initiative: Progress, Contributions and Prospects," and its text has been published by the Xinhua News Agency. To offer more information about the document, we are delighted to welcome two of the officials involved to update you on the development of the BRI and to answer your questions. They are Mr. Xiao Weiming, director general of the Department of General Affairs at the Office of the Leading Group for Promoting the Belt and Road Initiative; and Mr. Song Lihong, director general of the Comprehensive Department at the Ministry of Commerce. Now, I'll give the floor to Mr. Xiao.

Xiao Weiming:

Ladies and gentlemen, friends from the press, when General Secretary Xi Jinping visited Central Asia and Southeast Asia in 2013, he proposed the initiative of jointly building the Silk Road Economic Belt and the 21st Century Maritime Silk Road, known for the Belt and Road. This has received a positive response and widespread support, and has been followed with great interest by the international community. To promote the implementation of this major initiative, the Chinese government has set up a leading group and established the Office of the Leading Group for Promoting the Belt and Road Initiative within the National Development and Reform Commission.

Ahead of the second Belt and Road Forum for International Cooperation (BRF), being approved by the Leading Group for Promoting the Belt and Road Initiative, the Office of the Leading Group has released the book "The Belt and Road Initiative: Progress, Contributions and Prospects." This is the third time for the Chinese government to publish the progress of BRI project construction, which is also one of the major achievements of the second BRF. From an objective, rational and fair perspective, the report has summarized the experience of building the BRI over more than five years as a way to further enhance the international community's understanding of this joint building initiative, and to promote mutual political trust, economic integration and people-to-people connectivity among different countries. The BRI also aims to work together with the international community to cope with the challenges facing the global economy, to create new development opportunities, to seek new driving forces for development, to realize advantageous complementarities and mutual benefits, and to work together toward the jointly building of the community with shared future for mankind — so that a new journey of BRI construction can soon be embarked upon.

The report contains around 18,000 words and consists of four parts: Preface, Progress, Contributions, and Prospects. It will be published in Chinese, English, French, Russian, German, Spanish, Arabic, and Japanese. Today, I will present the Chinese and English versions to you. The other six versions will be issued soon.

The report pointed out that the BRI adheres to the principle of joint construction through consultation to bring benefits to all, and has achieved remarkable results in the past five years. All participants have benefited from the BRI and have a growing sense of identity and engagement with the initiative. This corresponds with an old Chinese saying: the peach and the plum do not speak, yet a path is born beneath them (a sincere man attracts admiration). 

In terms of policy coordination, the Belt and Road Initiative and its core concepts have been written into relevant documents of organizations including the United Nations, the G20, APEC and other regional organizations. So far, China has signed more than 170 cooperation documents with more than 150 countries and international organizations, including the China-Mongolia-Russia cooperation plan, and bilateral cooperation plans with Kazakhstan, Cambodia, Laos, Czech Republic, Hungary and Brunei.

In terms of facilities connectivity, the construction of six international economic cooperation corridors has been steadily advanced, playing an important role in establishing and strengthening interconnected partnerships among countries and building an efficient and smooth market for Asia and Europe. The China-Laos Railway, the Sino-Thai Railway, the Jakarta-Bandung high-speed railway, and the Hungary-Serbia high-speed railway have all solidly advanced. Projects such as Gwadar Port, Port of Hambantota, Port of Piraeus and Port of Halifa are progressing smoothly. Significant progress has been made in energy cooperation ¬– electricity, oil and gas, nuclear power, new energy, coal, etc. – and the construction of cross-border optical cable information channels. As of the end of March, the China-Europe freight rail service network has exceeded 14,000 trips.

In terms of smooth trade, China launched the Initiative on Promoting Unimpeded Trade Cooperation along the Belt and Road -- so far, 83 countries and international organizations have been actively involved. China has signed or upgraded the free trade agreements with the Association of Southeast Asian Nations (ASEAN), Singapore, Pakistan, Georgia and other countries and regions. Since the first Belt and Road Forum for International Cooperation, China has signed more than 100 customs inspection and quarantine cooperation documents with countries along the route, and has achieved food quarantine access for more than 50 kinds of agricultural products.

In terms of financial and monetary integration, China, together with 27 countries, has endorsed the Guiding Principles on Financing the Development of the Belt and Road. The People's Bank of China has worked with multilateral development institutions to finance over 100 projects stretching across more than 70 countries and regions. The China-IMF Capacity Development Center and the Belt and Road Financial Development Research Center have been inaugurated. So far, 11 Chinese banks have established 76 first-level institutions in 28 countries along the Road. The cross-border RMB payment services have expanded to cover nearly 40 countries and regions along the Road.

In terms of people-to-people ties, China established the Silk Road Chinese government scholarships, and signed agreements with 24 countries along the Belt and Road route granting mutual recognition of higher education degrees and diplomas. China also concluded visa abolition agreements with 57 countries along the Belt and Road covering different types of passports, and reached 19 agreements with 15 countries to simplify visa procedures. The country also established overseas traditional Chinese medicine (TCM) centers and 43 bases for international cooperation on TCM in 35 countries along the Belt and Road.

In terms of industrial cooperation, from 2013 to 2018, direct investment from Chinese enterprises to countries along the route hit US$90 billion and the turnover of foreign contracted projects surpassed US$400 billion. China has signed capacity cooperation agreements with more than 40 countries and signed third-party market cooperation agreements with France, Italy, Spain, Japan and Portugal, to name a few.

The report stresses the initiative is from China, but it belongs to the world. It is rooted in history, but oriented towards the future. It focuses on the Asian, European and African continents, but is open to all partners. In a world undergoing major development, transformation and adjustments; peace, development and cooperation still remain the trend of the times. While the BRI projects are currently being carried out in a steadily and meticulous manner, China stands ready to work with all the parties to promote the implementation of BRI, turning the Belt and Road into a route of peace, prosperity, openness, green, innovation, civilization and integrity. Thank you.

Hu Kaihong:

Thank you, Mr. Xiao. Now, let's welcome Mr. Song to make an introduction.

Song Lihong:

Friends from the media, good afternoon. Today, the Office of the Leading Group for Promoting the Belt and Road Initiative launched the book "The Belt and Road Initiative: Progress, Contributions and Prospects."I'd like to take this opportunity to introduce the trade cooperation under the Belt and Road Initiative, as the former is an important part of the latter. 

Since the proposal of the Belt and Road Initiative, the Ministry of Commerce, guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and fully implementing the Party Central Committee's policy decisions on the initiative, has worked hard to promote trade cooperation between China and other countries along the routes, and made remarkable achievements. These are evident in five aspects.

First, two-way trades were increased continuously. We actively promoted the expansion of mutual market openness of countries along the routes of the Belt and Road Initiative, and continued to promote trade facilitation. We improved trade structure, and nurtured new areas of trade growth. We also strengthened trade promotion activities with countries along the routes through comprehensive and special exhibitions. We accelerated the innovation of trade forms, and nurtured new models of business, such as e-commerce. 

Between 2013 and 2018, the imports and exports between China and other countries along the Belt and Road exceeded US$6 trillion, registering an annual increase of 4%, which is higher than the increase in China's total foreign trade. The volume accounted for 27.4% of China's total trade in goods.

Second, two-way investments are developing in an in-depth way. We continue to strengthen the necessary service guarantees and encourage enterprises to invest in relevant Belt and Road countries. While realizing their own development, they can also help the host countries to develop their economy and improve local people's livelihood. At the same time, we continue to relax the permission procedures for foreign investment as part of creating a high-standard business environment, set up 12 free trade pilot zones open to the world, and explore the construction of free trade ports to attract countries along the Belt and Road to invest in China. From 2013 to 2018, Chinese enterprises directly invested more than US$90 billion in countries along the Belt and Road, with an average annual growth rate of 5.2%. The turnover of foreign-contracted projects along the Belt and Road has exceeded US$400 billion, while direct investments in China from Belt and Road countries has exceeded US$40 billion.

Third, big projects have been carried out and are producing their intended results. We, along with relevant parties, have launched a series of cooperation projects to build infrastructure facilities and industrial investment. Some big projects have been carried out as planned, one after another. For example, the Addis Ababa-Djibouti Railway has come into operation; the China-Maldives Friendship Bridge has opened to traffic; the Gwadar Port in Pakistan has acquired the capacity necessary to ensure its complete operation. There are so many such infrastructure facility projects, which have effectively promoted the host countries' economic development and the improvement of local people's livelihoods, making them popular among locals.

We have also actively co-built some economic and trade cooperation zones, which have developed and improved over time. These zones play the following roles: they provide Chinese enterprises with platforms for their overseas investment and development; they provide the host countries with opportunities to learn more from China's experience in using industrial parks to boost economic growth; and they also prove to be effective carriers for industrial cooperation between China and these countries. 

Fourth, the construction of free trade areas has sped up. We have expedited the construction of free trade areas with countries along the route of the Belt and Road, and signed or upgraded the free trade agreements with the Association of Southeast Asian Nations, Pakistan and other countries and regions. These agreements have provided effective institutional arrangements for the liberalization and facilitation of trade and investment between these countries and China.

It is fair to say that a free trade zone network has gradually taken shape along the route of the Belt and Road. In addition, we have also actively promoted regional economic cooperation. We have signed trade and economic cooperation agreements with the Eurasian Economic Union, and the negotiations on regional comprehensive economic partnerships have made positive progress. 

Fifth, the cooperation mechanism has improved. The Ministry of Commerce has built bilateral economic and trade committee as well as joint committee mechanisms with all countries related to the Belt and Road Initiative. Meanwhile, we also have some regional and sub-regional cooperation platforms. We take advantage of these platforms to strengthen communication and coordination on important Belt and Road topics. 

At the same time, to further strengthen the frequency and effects of coordination, we have built work groups on unimpeded economic and trade cooperation, and investment with relevant countries, under the bilateral committees and joint committees. We have created bilateral e-commerce business cooperation mechanisms with 17 countries, and service trade cooperation mechanisms with 14 countries, as well as signed third party market cooperation agreements with Japan, Spain, the Netherlands, Belgium, etc. All this can be seen in media reports.

Generally speaking, the economic and trade cooperation between China and the countries involved in the BRI have improved greatly. Since the Belt and Road Initiative was proposed six years ago, it has produced remarkable achievements, intensified economic ties, and deepened economic cooperation between China and its partner countries. The initiative has also helped China improve its development through opening-up, and also prompted relevant countries to integrate into regional or even global value chains. This has allowed it to make positive contributions toward the development of economic globalization and the open world economy. Thank you all.

Hu Kaihong:

Thank you, Mr. Song. Now, we open the floor to questions. Please identify the news organization you represent before asking your question.

People's Daily:

The Second Belt and Road Forum for International Cooperation (BRF) will be held in Beijing later this week. During the first BRF held in 2017, China and other involved parties reached a number of cooperation agreements and policy measures, resulting in more than 270 deliverables. Could you brief us on the implementation of those results in the past two years? Thank you.

Xiao Weiming:

Thank you for your question and careful attention to the results of the first BRF. Indeed, the forum achieved a remarkable outcome. I'm delighted to announce that, through concerted efforts, all of the 76 items comprising 279 concrete results in five key areas have been completed as planned, and some have even become routine works for further implementation. The accomplishment satisfying to all the concerned parties lays a solid foundation for the second BRF.

I think the 279 concrete results can be summarized as follows:

First is the fresh progress made in policy consultation through closer cooperation and a broader consensus. The Belt and Road cooperation documents signed between China and more than 10 other countries or international organizations during the first BRF have been implemented, effectively enhancing policy connectivity, political trust and the convergence of interests. The BRF Advisory Council and Liaison Office have both been officially established. The Facilitation Center for Building the Belt and Road within the National Development and Reform Commission has begun operation. The ability of the official Belt and Road Internet portal to engage in international communications has been significantly improved.

The second aspect lies in promoting infrastructure connectivity focusing on key projects. We have implemented a large number of infrastructure cooperation projects in such fields as transport, energy and water resources, and gained financing support for the Jakarta-Bandung high-speed railway, Colombo Port City, Hungary-Serbia railway and Line 2 of the Hanoi light rail network, etc. The agreements signed between China and Russia, Belarus, Germany, Kazakhstan, Mongolia and Poland to deepen cooperation in promoting China-Europe regular railway cargo services is being implemented, with an international mechanism for the cooperation playing an important role.

Third is enhanced liberalization and facilitation of trade and investment through expanded industrial investment. China has signed production capacity cooperation agreements with 41 countries, set up platforms of investment and financing such as those linking China-Latin America and China-Africa, and successfully hosted the first China International Import Expo. We have deepened cooperation for connectivity in regard to standards, metrology, customs, inspection and quarantine. Six ports, including Khorgos have started to implement the Convention on International Transport of Goods Under Cover of TIR Carnets. Under the BRI framework, China has fostered agricultural cooperation with Serbia, Chile, Egypt and other countries.

Fourth involves the efforts being made in diversifying systems of financial connectivity through strengthened financing support. China has worked with other concerned parties to jointly formulate guidelines for financing Belt and Road-related development projects, in an effort to establish a stable and sustainable financial safeguard system controlling risk. The Asian Financial Cooperation Association now has more than 100 members, offering special lending schemes worth RMB 380 billion equivalent to support Belt and Road cooperation in infrastructure, industrial capacity expansion and financing. The Silk Road Fund has been expanded by RMB 100 billion.

Fifth is the enhancement of people-to-people exchanges through more interactions. We have deepened cooperation in culture, media, environmental protection with other Belt and Road countries, offered more than 800 short-term research visits to China for foreign scientists, and developed new people-to-people exchange platforms such as a network for cooperation among NGOs in countries along the Belt and Road, a music education alliance and think tank networks. Thank you.

Economic Daily:

Mr. Song of the Ministry of Commerce just now introduced some achievements in the Belt and Road economic and trade cooperation. What measures does the ministry plan to take to promote the cooperation from now on? Thank you.

Song Lihong:

Thank for your question. Last August, President Xi Jinping stressed at a symposium marking the fifth anniversary of Belt and Road construction that high-quality joint construction should be pursued with even more meticulous efforts. We will act strictly in accordance with the requirement by further deepening mutually beneficial and win-win cooperation with relevant countries in the economic and trade fields, and improve the quality of our cooperation to achieve more for the benefit of people all over the world. We will take five specific steps this year:

First is to build a high-level platform for cooperation. As you all know, last year, we successfully hosted the first China International Import Expo. This was an important decision made by the Communist Party of China Central Committee with Comrade Xi Jinping at its core to promote a new round of high-level opening up, and is a major initiative by China to further open its market to the rest of the world. The successful convening of the first expo exerted wide influence worldwide, winning high praise and establishing an important milestone for high-level opening up in the new era. This year, while consolidating the achievements of the first expo and promoting the completion of deals and contracted projects achieved then, we will make careful preparations for the second expo in accordance with the important instructions of President Xi Jinping to ensure we can host a high-level, productive and increasingly improving event. I believe it will provide a platform for all countries to share the dividends of China's development and an effective promoter for high-quality construction of the Belt and Road.

The second step is to make meticulous efforts for major economic and trade cooperation projects. We will focus on industrial investment and infrastructure connectivity, and promote the construction of a number of major projects with good comprehensive benefits and strong driving effects, so as to help developing countries consolidate their foundations for further economic development, better participate in the global division of labor, and benefit from the global value chain. We will continue putting people at the center of our efforts, delivering timely assistance to the needy, promoting more foreign aid projects concerning people's livelihood and immediate interests, and increase their sense of gain.

Third, we intend to carry out more activities to promote trade and investment. In my opinion, to construct a superior Belt and Road, the government should seek to play a role of higher quality. However, it is still the market that should play the decisive role in allocating resources. Thus, it is up to market players at large to strengthen their cooperation. Entrepreneurs need to meet, negotiate and discover business opportunities. Therefore, we will perform our duty in organizing various kinds of large-scale exhibitions, especially for the Belt and Road countries, and step up efforts in attracting investment and inviting exhibitors. We will also support regional efforts to build trade and investment promotion platforms with distinctive themes and features, creating more business opportunities from interactions among entrepreneurs.

Fourth, we intend to accelerate the development of "Silk Road E-commerce". The internet and the upcoming large-scale commercialization of 5G will create more favorable conditions for e-commerce development. At the beginning of the reform and opening up program, China's trade and investment cooperation with relevant countries proceeded through door-to-door marketing. Now, we do not need to follow that way any longer. With computers and mobile phones, we can select goods and services and have them delivered to us at the press of a button. Therefore, we will make full use of modern information technology to empower, add new impetus and boost the growth of China and relevant countries' foreign trade with e-commerce.

Fifth, we will promote the construction of free trade zones. We will work with willing countries to establish new free trade zones, and upgrade existing ones according to higher standards. In other words, we will reduce institutional and artificial barriers to trade and investment, and promote a grand market of the Belt and Road. Thank you.

AFP:

I have a question on numbers. Could you tell us the total sum of investment and loans for the Belt and Road projects?

Xiao Weiming:

Thanks for your question. Over the years since the Belt and Road Initiative was proposed in 2013, we have invested a total of over US$90 billion in countries along the Belt and Road. The sources of loans for those Belt and Road projects are diverse, including commercial banks, policy banks and international monetary institutions. In doing so, we share both benefits and risks. Thank you.

CCTV:

It is now more than five years since the Belt and Road Initiative (BRI) was first raised, and different views towards the initiative have emerged. How does the BRI contribute to the world? I would like to know your point of view.

Xiao Weiming:

Thank you for the question. After fully grasping the guiding principles from General Secretary Xi Jinping's important addresses and instructions, and studying the documents on the decisions and plans of the CPC Central Committee and the State Council, I would like to sum up the great significance of the BRI in the following aspects: 

For China itself, it is the master plan to promote opening-up and international economic cooperation.

For the world, it provides an important platform for promoting common development and prosperity, and building a community featuring a shared future for humanity. 

Domestically, the BRI has further promoted the reform and opening of our country, with the focus on the overall plan for promoting all-round economic, political, cultural, social, and ecological progress, as well as the Four-Pronged Comprehensive Strategy. It has become a distinct symbol of China's reform and opening in the new era. Driven by the BRI in recent years, we have increased the openness of the service sector; made the manufacturing sector basically open to all; widened access to the agriculture, energy and resources sectors; deepened reform of the investment and financing, fiscal and tax systems and the financial sector overall; reduced the negative lists for the access of foreign investment for both nationwide implementation and pilot free trade zones (FTZs); and, it has significantly improved the overall business environment. According to the 2019 World Bank Doing Business Report, China ranks 46th globally, 32 places higher than last year.

We have promoted the opening-up of areas along the coastline and the Yangtze River, as well as in border and inland regions, moving toward nationwide opening-up that connects the eastern and western regions, and attaching equal importance to the "bring in" and "go global" strategies. We have cooperated with some developed countries to jointly explore third-party markets, while constantly raising the quality and standard of opening-up. What I want to emphasize here is that, as they have fully engaged in the Belt and Road development, China's central and western regions, especially the latter, have moved from forming the background to the forefront of China's reform and opening up, and are filled with great vitality. 

The contributions to the international political and economic landscapes lie in the following two aspects: 

First, the BRI's firm support in building multilateralism and the multilateral trading system, as well as enhancing free trade and investment have provided a robust driving force for the recovery of global economy. China has contributed over 30% of global economic growth, which has made us the strongest driving force globally. In addition, the annual rate of contribution of China's final consumption expenditure to global consumption growth in recent years places China as the top contributor. Therefore, due to the BRI, Kazakhstan, the largest landlocked country in the world, is able to establish a corridor to the sea; Belarus is able to develop its own automotive industry; Maldives' dream to build bridges is coming true; Pakistan's electricity shortage is solved because of several new power plants; and Laos will change from being a landlocked country to one that is land-connected once the China-Laos railway opens. These examples show the contributions of the BRI to economic growth and improvement of the wellbeing of people living in the countries along its route.

Second, the BRI helps to improve global governance. Within the BRI, the principles of consultation, collaboration and benefit for all, as well as "the connectivity of policy, transportation, trade, currency and the heart of the people" show the initiative's endorsement of multilateralism, free trade, and a multilateral trade system. We firmly believe in dialogue and consultation, and work collaboratively to promote communication. This is in order to build a community with a shared future for mankind through political and mutual trust, economic globalization as well as people-to-people exchanges. The initiative has been widely recognized worldwide and as I've mentioned before, the BRI has been included into many documents of international organizations like the U.N., G20, APEC, and SCO. It is clear that the BRI fulfills the internal requirements of a global governance system reform, demonstrating the concept of a community with a shared future for mankind and providing Chinese wisdom toward the improvement of the global governance system. Thank you.

Reuters:

China has promised to develop the Belt and Road into a sustainable and green path, and refuted claims of a so-called "debt trap." Do you have any details or concrete measures to share with us on this? In addition, does China have plans to introduce new laws and regulations on company investments to regulate future investments under the framework of the Belt and Road Initiative?

Xiao Weiming:

Thank you for your concern. Promoting the building of a green Silk Road is an important part of jointly building the Belt and Road Initiative. Over the past few years, Chinese companies that are "going global" have been adhering to the idea of green and environmentally friendly development, both in infrastructure investment and manufacturing investment. We have conducted strict environmental assessments in the building of hydroelectricity power plants, coal-fired power plants, roads and ports. We have even hired third-party independent organizations to do some preparatory research. In fact, due diligence is always performed in China by companies to produce a feasibility report. So we are upholding to the idea of green and environment-friendly development as we push forward in our projects.

We are willing to work with all parties concerned to follow through on our commitments to green development. We will strengthen international cooperation on eco-environmental protection to address climate change. We will improve the protection and restoration of the eco-system and develop "green finance." As to the platitudes on the "debt trap," I can say responsibly that since the initiative was proposed, no country has fallen into the so-called "debt trap" for participating in the building of the Belt and Road. On the contrary, all the participating countries have witnessed rapid development. Therefore, the so-called "debt trap" is a false proposition. Thank you.

Song Lihong:

Please allow me to share with you some of my thoughts and what I've learned. Recently, there were many stories about the so-called "debt traps." If a country, a family or an enterprise wants to make progress, the correct way is through self-accumulation before anything else. However, I want to emphasize that if you discover great potential of development, or if you are very confident of achieving development, you need to make extra efforts to realize it. In this situation, you need to use financial leverage tools. In other words, you need to borrow money to achieve development. How to judge if the timing is right for such a move? You must be able to obtain the loan. You must borrow money without doing harm to your reputation. On a country-level, especially those relatively less developed, or are under rather heavy debt burdens, I still don't think they should be deprived of the right of seeking development. Or, to put it another way, they should enjoy the right of seeking development by increasing their leverage ratio a little bit.

In this case, no matter who is involved — the country that lends the money, the country that borrows the money, or the enterprise that take a part in the cooperation, all face certain requirements. The borrower needs to pay close attention to its financial situation. It must focus on economic growth. In particular, it must intensify the efforts in infrastructure construction and industrial investment, so as to accelerate the industrialization process. Meanwhile, countries that lend the money, whether developed or emerging countries like China, are obliged to help the comparatively less developed countries improve their financing conditions. Regarding enterprises that take a part in the cooperation, as Mr. Xiao just said, they need to carry out feasibility studies to manage risks. What is the return of foreign investment? We should understand this concept from two perspectives: One is the time value of the funding, the other is the risk premium of the investment. If you cannot manage the risks, how can you make profits?

Solving the debt issue needs the efforts of all parties involved. We can follow the principle of "consultation, collaboration and benefit for all" to gradually tackle the problem. Although some countries are under high debt pressures, their debts will gradually fall when their industrialization, urbanization and modernization are accelerated. One thing for sure is that without development, without hard work, there will be no hope at all. Thank you. 

Phoenix Satellite TV:

Could you please introduce the progress being made in the construction of overseas economic and trade cooperation zones, and what kind of expectation do you have for the next stage in their development? Thank you. 

Song Lihong:

The overseas economic and trade cooperation zones, as I said at the beginning of the briefing, are an important platform for Chinese enterprises to invest abroad. They are also an "effective carrier" for China to conduct industrial cooperation with countries along the Belt and Road. Since the BRI was first proposed, overseas economic and trade cooperation zones have witnessed fast development. However, it should be noted that these zones were already being established before the BRI was proposed, so they are actually not an emerging phenomenon. However, they have kept expanding ever since the BRI was proposed. You can tell that they have become a major focus of BRI construction and a glorious part of a beautiful landscape. Such examples can be found in many countries, and I believe most of you present may have already witnessed their development, so I will not go into details here. According to the statistics of the Ministry of Commerce, the accumulated Chinese investment in overseas economic and trade zones has reached nearly US$40 billion, while contributing over US$3 billion in taxes and fees to the host countries, and creating more than 300,000 jobs. Over 70% of those economic and trade cooperation zones have been jointly established with countries along the Belt and Road. 

Next, we will enhance the integration of plans, industries and mechanisms with our partner countries through jointly building the Belt and Road Initiative. We strongly advocate openness and cooperation, adhere to the concept of green and sustainable development as well as promote practical cooperation in the construction of cooperation zones. We want to make cooperation zones the effective medium of industrial cooperation between China and the host countries and pilot zones for promoting industrialization by host countries. We should strive to cultivate some cooperation zones with geographical advantages, distinct industrial positioning, advanced management and outstanding construction achievements. We want to let cooperation zones become important international cooperation platforms based on mutual benefit and creating a win for all.  

There will be 12 sub-forums in the upcoming Second Belt and Road Forum for International Cooperation. I hope to draw attention to the Overseas Economic and Trade Cooperation Sub-Forum which is sponsored by China's Ministry of Commerce. The preparatory work is now coming to an end. We will invite relevant countries, intermediaries and enterprises to discuss how to develop high-quality overseas economic and trade cooperation zones at the sub-forum. Thank you.

China News Service:

Just like what you said, Mr. Xiao, the Belt and Road Initiative will become the road of peace, prosperity, opening up, green development and innovation, the road connecting different civilizations and the road with high ethical standards. May I ask you to elaborate on the specific plans and designs that China has endeavored to achieve in the aforementioned goals.

Xiao Weiming:

Thank you. First, please allow me to help review the origins of the seven aspects of the abovementioned "road." In May 2017, Xi Jinping, the General Secretary of the Central Committee of the Communist Party of China (CPC), pointed out at the opening ceremony of the first Belt and Road Forum for International Cooperation that the Belt and Road Initiative should become the road of peace, prosperity, opening up and innovation as well as a road connecting different civilizations. This set the tone and outlined the initiative's five functions. At the same time, he also stressed that we should strengthen international counter-corruption cooperation so that the Belt and Road will be a road with high ethical standards. During last year's Beijing Summit of the Forum on China-Africa Cooperation, General Secretary Xi proposed to adopt the principle of green development when executing the Belt and Road Initiative. Those are the seven principles of the "road," around which our prospects and preliminary plans have formed.

In view of the road being one that leads to peace, we are willing to pursue common, comprehensive, cooperative and sustainable security with the rest of the world, while adhering to the global governance principle of sharing growth through discussions and collaboration. We hope that we can jointly establish dispute settlement, risk early-warning and prevention and control mechanisms, all be resolved to combating terrorism, secessionism and extremism. We want to also promote a new type of international relations featuring mutual respect, fairness, justice and win-win cooperation, forge partnerships of dialogue with no confrontation and of friendship rather than alliance.  

In view of the road being one that leads to prosperity, we hope that we can press ahead with interconnectivity whether on land, at sea, in the air or through the internet, with the rest of the world. We will expand bilateral and multilateral investment and trade, deepen industrial cooperation, cultivate new driving forces and new business models. We also want to establish a stable and sustainable financial service system that keeps risks under control, and achieve economic integration and interconnected development to the benefit of all participants.

In view of the road being one that leads to further opening-up, China upholds and strengthens the multilateral trade system which is rule-based, open, transparent, inclusive and non-discriminative. China promotes liberalization and facilitation of trade and investment by building high-standard free trade areas jointly with other countries. We'll follow the rules of the market as well as internationally applicable standards and rules to build a global economy that is fully open. 

In view of the construction of the Green Silk Road, we are willing to work with countries around the world to implement the overall concept of green development, deepen international cooperation, jointly address various challenges, strengthen ecosystem protection and restoration, as well as exploring the development of green finance. We are committed to creating a way of life and work that is green, low-carbon, circular and sustainable, so as to achieve the 2030 Sustainable Development Goals set by the United Nations.

In view of building a road of innovation, we want to develop a national-level joint scientific research platform with various countries around the world, thus forming a multi-level and diversified scientific and cultural exchange mechanism. We are also willing to strengthen cooperation in frontier, cutting-edge sectors such as the artificial intelligence, nanotechnology and quantum computers, as well as promoting intellectual property protection.

In terms of building a road that brings together different civilizations, we seek to deepen cooperation with many countries around the world in regard to education, science and technology, culture, health, sports, media, tourism and other fields. We will also strengthen our exchanges between political parties, think tanks and non-governmental organizations, as well as promoting exchanges between women and youth. In fulfilling these goals, we are willing to continue providing assistance within our capacity to developing countries along the Belt and Road routes.

In terms of building a road reflecting the high ethical standards, we wish to work with various countries to strengthen supervision, management, and risk prevention and control of the construction projects emerging along the routes. We will make efforts to create a clean and efficient modern business environment, promote international anti-corruption exchanges and cooperation, improve the anti-corruption law system, and continue to crack down on commercial bribery, etc. Thank you.

Kyodo News:

Yesterday, explosions rocked Sri Lanka. Will this incident be mentioned in theis forum? Also, please tell us about the specific discussions on peace building and security aspects.? Thank you.

Xiao Weiming:

Thank you for your question. Regarding the security issue you mentioned, China pays great attention to safety and security in Belt and Road construction. The relevant Chinese government departments have strengthened cooperation with the security authorities of countries along the Belt and Road and conducted institutional dialogues and exchanges. In general, the results of cooperation are extensive and in-depth. We have established an institutionalized security dialogue mechanism with countries in Central Asia and South Asia. The overall goal is to jointly fight against terrorism and various violent crimes through cooperation between the relevant Chinese authorities and those in countries along the Belt and Road, in order to create a good security environment, and provide guarantees for safe and smooth development of Belt and Road projects. We also hope countries along the Belt and Road will continue to strengthen cooperation with the Chinese government, further improve dialogue, and enhance mutual exchange of information and mutual assistance in law enforcement during expanded collaboration in the future. Thank you.

Xinhua News Agency:

It has just been mentioned that, during the Second Belt and Road Forum for International Cooperation, the Ministry of Commerce will take the lead to organize two sub-forums, namely the Unimpeded Trade Sub-Forum and the Overseas Economic and Trade Cooperation Zones Sub-Forum. Can you tell us more about these two sub-forums? Thank you.

Song Lihong:

The Ministry of Foreign Affairs has held a briefing regarding the Second Belt and Road Forum for International Cooperation. Since you are concerned about the two sub-forums hosted by the Ministry of Commerce, I will give you a brief introduction about them.

The Unimpeded Trade Sub-Forum will be held at the National Convention Center on the afternoon of April 25. The sub-forum is organized by the Ministry of Commerce, and is co-organized by the General Administration of Customs, the State Taxation Administration, the Export-Import Bank of China and the China Export and Credit Insurance Corporation. The theme is "Openness, Inclusiveness, and Innovation, Deepening Belt and Road Unimpeded Trade Cooperation." Discussions will focus on "deepening multilateral and bilateral economic and trade cooperation, and promoting openness and integration," "developing new trade forms and promoting innovation-driven development," and "optimizing the business environment, and promoting sustainable development." Judging from the number of sign-ups, the sub-forum has drawn a lot of attention. We estimate that there are about 300 Chinese and foreign participants, including more than 200 of the latter, many of whom are ministerial level and above.

The Overseas Economic and Trade Cooperation Zones Sub-Forum will be held at the National Convention Center on the morning of April 25. The Ministry of Agriculture and Rural Affairs and the All-China Federation of Industry and Commerce are co-organizers. The theme is "Jointly building overseas economic and trade cooperation zones and promoting Belt and Road international investment cooperation." Participants will discuss the topics of "building overseas economic and trade cooperation zones through discussion and collaboration" and "promoting high-quality development of overseas cooperation zones." There will be about 200 participants, more than half being foreigners.

In addition to the guest speaker session, these two sub-forums also have a discussion session. We believe that all parties will make full use of these opportunities to create a greater consensus on economic and trade cooperation, and make new efforts and contributions to promote the high-quality development of the Belt and Road. Thank you.

Beijing Youth Daily: 

According to the report, China has signed cooperation documents with more than 150 countries and international organizations as well as standardization cooperation agreements with more than 40 countries and regions. My question is, what else should China consider when trying to promote the connectivity of policies, standards and regulations with these parties in addition to the implementation of the agreements and documents?

Xiao Weiming:

Thank you for your question. With the further development of the plan to jointly build the Belt and Road Initiative, the aspect of connectivity has transformed from a "hard" concept in the past five years that mainly involves infrastructure construction, to a "soft" one that now involves standards and regulations. Or, at least equal stress has been placed on both aspects. In my opinion, the integration of the "soft" aspect of the BRI is more important and lasts longer than that of the "hard" aspect, to some extent. This is because all the physical connectivity will depend on the connectivity of standards and regulations eventually. So we are keenly aware of the heavy responsibilities we bear and have already launched an effort to specifically work on the integration of standards and regulations which are already included in the key points of our work in 2019. Related departments have also been instructed to carry out work in this aspect. Here, I would like to emphasize a few points:

First, on the connectivity of policies, I believe that more is better and this is a process that is always underway. The Belt and Road Initiative is an open and inclusive one. We welcome any country that wants to build the Belt and Road Initiative with us. In addition to the more than 150 countries and international organizations you have mentioned before, we welcome and are waiting for other countries to join us.

Second, as for the connectivity of standards and regulations, this is a long and arduous task. It's easy for us to speak in general terms about this issue but, in reality, it's very complicated when you sit down to negotiate about integration. Since the beginning of last century or the end of the 19th century, people have started to draw up international standards and regulations. Among those standards and regulations, there are some related to the Belt and Road Initiative and can be roughly classified into three categories, namely international law, international private law and international economic law. As for the standards of international economic law, those of investment and trade are the top priorities. Aspects like trade, investment, transportation, finance, insurance, intellectual property protection and labor are already included in investment and trade standards. Furthermore, each aspect includes many international treaties, conventions and agreements. So you have to negotiate them individually when you plan to integrate a specific standard or regulation. 

Third, the Chinese government firmly supports the multilateral trading system and free trade based on rules, and upholds the UN Charter. It also observes the international law and the basic norms governing international relations and adheres to international treaties, conventions and agreements China has entered into and participated in. China has always been willing to make her own contributions to the improvement of international standards and regulations based on international treaties, conventions and agreements.

So I think the connectivity of standards and regulations will become the key point of our work in the next phase as we hold the Second Belt and Road Forum for International Cooperation and implement its outcomes. Thank you.

China Daily:

Dubbed the "caravans of steel camels", the China-Europe Railway Express has been gradually increasing the number of its freight train runs and expanding its coverage and influence. Could you give us an introduction of its development, the main work and future plans?

Xiao Weiming:

Thanks for your attention to the China-Europe Railway Express, which has been growing along with the Belt and Road Initiative. So far, the cumulative total of shipments has reached 14,691. The freight trains have created a link between 62 cities in China and 51 cities in 15 European countries. A total of 68 rail routes have been developed. All Chinese cities can be linked with any European country via three rail channels -- a western route through the Alataw Pass, an eastern route through Manzhouli, and a middle line through Erenhot -- and then on through central Asia, Belarus and Russia. Goods are flowing continuously via these "caravans of steel camels" as you say. The progress made in China-Europe Railway Express project can be described through several features.

First, the transport quality has improved significantly. The ratio of departing trains to returning trains has gone from 2:1 to 3:2 and to 99% now. A balance in two-way communications has been basically achieved. Currently, 88% of the containers are full of goods, an increase of 4 percentage points compared with last year. We have also beefed up security measures along the routes.

Second, the goods transported have gradually become more diversified. The goods items have expanded from IT products like smartphones and computers to clothing, shoes and hats, automobiles and auto parts, grain, grape wine, coffee beans and logs. Car exports form a new growth pillar. It is worth noting that China-Europe Railway postal services have also become regularized.

Third, the railway has significantly spurred the growth of surrounding areas. With the development of the railway, a safe, convenient and efficient "trade passageway" has opened for countries along the route, and most certainly for China's landlocked regions. Multimodal connectivity projects have appeared and have basically achieved rail-inland water and rail-maritime transportation, contributing greatly to regional economic and employment growth. The total cargo value of China-Europe freight trains reached US$ 3.3 billion in 2018, up 106% from the year before.

Fourth, significant progress has been made in institutional construction. An agreement for further cooperation covering China-Europe Railway has been signed by seven countries, including China, Belarus and Russia. A joint working group has been established, with the addition of three national observers, namely the rail administrations of Lithuania, Latvia and Austria. The joint working group has cooperated to improve the capacity in regard to transport organizing, marketing and information-sharing. Domestically, a coordinating board for China-Europe Railway has been established as a self-coordinating mechanism between enterprises. 

Therefore, we are confident that with the further implementation of the BRI, the China-Europe Railway will enhance international cooperation and interaction between industries, win a higher reputation for itself, further address railway traffic congestion, improve the efficiency of customs clearance, and provide better services for people of countries under the BRI. Thank you.

China Business News:

While trying to meet the challenges from the complicated geopolitical and international trade landscape of China, the United States and Europe, our country is also undergoing domestic economic restructuring. How can we ensure a sustainable development and effective implementation of the BRI in this context? Thank you.

Xiao Weiming: 

That's a fairly broad question. I will have to answer it briefly. The China-U.S. trade friction has drawn worldwide attention, and the Belt and Road Forum for International Cooperation will be convened soon. Guided by the principles of openness, inclusiveness, and mutual benefit, we welcome all countries, including the United States, to participate in the BRI and the upcoming forum.

China and the United States are the biggest developing country and developed country in the world. We have huge potential for cooperation with complementary strengths. Last year, the GDP of the United States surpassed US$20 trillion, reaching US$20.5 trillion, while the GDP of China totaled US$13.6 trillion, about 66% of the U.S. figure. However, the per capita GDP of China is only about 15% of the U.S. level. Thus, there is still a big gap between us. We need to learn from the United States, and promote development through economic cooperation. There is enormous room for cooperation between the two countries.

In addition, China is a large market for American agricultural and high-tech products. Therefore, we have good reason to believe cooperation outweighs friction in the China-U.S. relationship. As for trade friction, it's normal for the two countries to have some disputes and differences in trade and opinion. I believe that more countries, including the United States, will gradually embrace the principles of extensive consultation, joint contribution and shared benefits, as well as "a five-pronged approach" [policy coordination, connectivity of infrastructure and facilities, unimpeded trade, financial integration, and closer people-to-people ties] to jointly build the BRI. 

When it comes to the European Union, China and it have long cooperation, and many of EU member states have become important partners to jointly build the Belt and Road. In particular, the EU strategy on Connecting Europe and Asia proposed by the EU dovetails neatly with the BRI, and the two sides are working to enhance the policy coordination. We welcome closer cooperation with the EU and its member states to produce more substantial benefits. Thank you.

Song Lihong:

Please allow me to add something. You asked just now what China's consideration is under the circumstance of facing a very complicated geopolitical situation when promoting Belt and Road construction. I would like to ask you when the geopolitical situation was not complex from World War II until now. And do you know how much the world economy has developed since then? 

Therefore, I do not think that is a problem. As long as countries uphold openness and cooperation rather than working behind closed doors, the general trend of cooperation will be unstoppable. The leaders of all countries have the ability and wisdom to solve these problems, and our people are more than capable of solving these problems with their collective wisdom. Our entrepreneurs are also able to continue strengthening cooperation even though facing complex conditions and various risks.

Your second question concerns China's economic restructuring. Since the 18th CPC National Congress, the central government has held a view that China has entered a new normal in economic development. This means that we have shifted from a high to a medium-high growth rate, our economic structure have moved from low-to-medium level to medium-to-high level, and the driving force of our growth has changed from resource consumption to innovation. China's economy cannot achieve stable, sustainable and quality development without accelerating restructuring. Therefore, we must deepen the reform and open wider. 

Chinese President Xi Jinping has reiterated several times that China's door will never be closed, and it will only open still wider. Regional economy and global economy will make further progress and create more benefits only through continuous openness and cooperation, free flow of elements, better distribution of resources, and deepening integration of markets. 

Of course, when profits grow, we need to distribute them appropriately. But undoubtedly, they are beneficial to both the Chinese and global economies. Thank you.  

Hu Kaihong:

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

.

Read in Chinese

Date:

April 17, 2019

Shou Xiaoli:

Ladies and gentlemen, good morning. Welcome to this press conference. Today, we will release China's economic data. 

Mr. Mao Shengyong, the director general of the Department of Comprehensive Statistics at the National Bureau of Statistics (NBS) and spokesperson of the NBS, will present China's economic performance in the first quarter of 2019, and answer some of your questions. 

At this time, I'll give the floor to Mr. Mao.

Mao Shengyong:

Thank you. Ladies, gentlemen, friends from the media, good morning. In accordance with the usual practice, I will introduce the basic situation of the economic operation in the first quarter to you, and then answer your questions. 

In the first quarter, the national economy enjoyed stable performance with growing positive factors.

In the first quarter of 2019, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping as its core, all regions and departments implemented the decisions and arrangements made by the CPC Central Committee. The State Council, adhered to the general working guidelines of making progress while maintaining stability, and fully implemented the new development philosophy. It also conformed to the requirements of high quality development, made solid efforts to advance the supply-side structural reform, strengthened the counter-cyclical adjustment, and spared no effort to put the policies into effect. As a result, the national economy enjoyed stable performance with growing positive factors. There is also stronger market expectation and confidence, which will sustain the momentum of progress in overall economic stability.

According to preliminary estimates, the gross domestic product (GDP) of China was 21.34 trillion yuan in the first quarter, an increase of 6.4% at comparable prices year-on-year. This figure is the same as that of the fourth quarter last year, 0.4 percentage point lower than that of the same period last year and 0.2 percentage point lower than that of 2018. The value added of the primary industry was 876.9 billion yuan, up by 2.7% year-on-year; for the secondary industry it was 8.23 trillion yuan, up by 6.1%; and for the tertiary industry it was 12.23 trillion yuan, up by 7.0%.

1. The agricultural sector posted a stable performance with an improved planting structure. 

In the first quarter, the added value of the agricultural sector (crop farming) posted a year-over-year increase of 4.4 percent. The output of poultry, eggs and milk increased by 2.3 and 2.0 percent year-over-year, respectively; the combined output of pork, beef, mutton and poultry was 22.52 million tons, down 2.8 percent year-over-year. Broken down, the output of pork was 14.63 million tons, down 5.2 percent; but the output of beef, mutton and poultry were up by 1.7,1.4 and 2.1 percent, respectively. In March, the spring ploughing and sowing have proceeded smoothly in most major farming areas, due to favorable sunshine and soil moisture conditions, as well as good light and temperatures. The planting area intended for soybeans increased by 16.4 percent year-over-year, and the area for quality middle-season rice and single-cropping late rice grew by 1.9 percent.

2. The growth of industrial production accelerated and the proportion of high-tech industries rose. 

The growth of the total value added of industrial enterprises above the designated size was 6.5% year-over-year in the first quarter of 2019, or 1.2 percentage points higher than in the first two months, and 0.8 percentage point higher than in the fourth quarter of last year, also 0.3 percentage point lower than the same period last year. Analysis by types of ownership showed that the value added of state holding enterprises is up by 4.5%; that of share-holding enterprises is up by 7.8%; and that of enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan is up by 1.4%. In terms of sectors, the value added of the mining industry grew by 2.2% year-over-year, manufacturing increased by 7.2%, and the production and supply of electricity, thermal power, gas and water increased by 7.1%. The  value added of high-tech industries grew by 7.8% year-over-year, or 1.3 percentage points higher than that of industrial enterprises above the designated size, accounting for 13.5% of all industrial enterprises above the designated size, 0.8 percentage point higher than in the same period last year. The value added of strategic emerging industries grew by 6.7% year-over-year, or 0.2 percentage point higher than that of the industrial enterprises above the designated size. New products registered fast growth, with the output of devices for mobile communication base stations, urban rail vehicles, new energy automobiles and solar cells growing by 153.7%, 54.1%, 48.2% and 18.2% respectively in the first quarter. In March, the total value added of industrial enterprises above the designated size was up by 8.5% year-over-year, 3.2 percentage points higher than that of the first two months, or up by 1.0% month-over-month.

In the first two months, the profits made by industrial enterprises above the designated size stood at 708.0 billion yuan, down by 14.0% year-over-year, a slight decline compared with the same period last year after deducting the Spring Festival factor. The profit rate of business revenue of industrial enterprises above the designated size was 4.79%. Preliminary data shows that industrial enterprises improved realization of profits in March.

3. The service sector grew fast and the growth of major industries rebounded.

In the first quarter, the development of the tertiary industry witnessed progress while maintaining overall stability. Specifically, the added value of leasing and business services grew by 8.3% year-on-year; the financial industry increased by 7%; accommodation and catering services increased by 6%; and the wholesale and retail industry grew by 5.8%. All these growth rates were higher than the fourth quarter of last year. Information transmission, software and information technology services maintained rapid growth, up by 21.2% year-on-year.

In the first quarter of 2019, the national service industry production index increased by 7.4% year-on-year, 0.1 percentage point higher than that of January and February, and 0.2 percentage point higher than that of the fourth quarter of last year. In March, the national service industry production index was up by 7.6% year-on-year, 0.3 percentage point higher than that of January and February. In the first two months of the year, the business revenue of service enterprises above the designated size increased by 10.9% – 0.5 percentage point lower than that of last year.

4. Growth rate of market sales rose; share of online retail sales increased.

In the first quarter, the total retail sales of consumer goods totaled 9.78 trillion yuan, up by 8.3% year on year. This was a 0.1 percentage point higher than that of the first two months this year and 1.5 percentage points lower than that of the same period last year. The retail sales of consumer goods in urban and rural areas totaled 8.34 trillion yuan and 1.44 trillion yuan respectively, up by 8.2% and 9.2% year on year. Catering sales totaled 1.06 trillion yuan, up by 9.6% year on year. The retail sales of commodities totaled 8.71 trillion yuan, up by 8.2% year on year. The sales of cosmetics and communication equipment above the designated size grew by 10.9% and 10.0% respectively. This was 2.6 percentage points and 1.7 percentage points higher than that of total retail sales of consumer goods respectively. In March, the total retail sales of consumer goods increased by 8.7 percent year on year, 0.5 percentage point higher that of the first two months and 0.91 percentage point higher than that of February.

In the first quarter, online retail sales across China totaled 2.24 trillion yuan, up by 15.3% year on year. This was 1.7 percentage points higher than that of the first two months of this year. The online retail sales of physical commodities totaled 1.78 trillion yuan, up by 21% year on year. This accounted for 18.2% of the total retail sales of consumer goods and was 1.7 percentage points higher than that of the first two months of this year. 

5. Investment rebounded steadily and investments in high-tech industries grew rapidly.

In the first quarter of 2019, the investment in fixed assets (excluding rural households) was 10.19 trillion yuan. This marked a growth of 6.3% year-over-year. The growth rate was 0.2 percentage point higher than that of the first two months, or 1.2 percentage points lower than that of the same period last year. Specifically, private investment reached 6.15 trillion yuan, up by 6.4%. Investments in the primary industry grew by 3.0% and the secondary industry was by 4.2%. Among this, investments in manufacturing grew by 4.6%. The tertiary industry grew by 7.5%, of which the investment in infrastructure grew by 4.4%. Investments in high-tech manufacturing went up by 11.4% year-over-year, 5.1 percentage points higher than that of the total investment. Investments in high-tech services went up by 19.3% year-over-year, 13 percentage points higher than that of the total investment. In March, the investment in fixed assets (excluding rural households) grew by 0.45% than that in February. 

The total investment in real estate development in the first quarter was 2.38 trillion yuan, up by 11.8% year-over-year. The growth rate was 0.2 percentage point higher than that of the first two months, or 1.4 percentage points higher than that of the same period last year. The floor space of commercial buildings sold reached 298.29 million square meters, down by 0.9% year-over-year. The decrease was 2.7 percentage points lower than that of the first two months. The total sales of commercial buildings were 2.70 trillion yuan, up by 5.6%, and 2.8 percentage points higher than that of the first two months.

6. The growth of the total value of imports and exports accelerated and the trade structure continued to be optimized.

The total value of imports and exports in the first quarter was 7.01 trillion yuan, up by 3.7% year-on-year, 3 percentage points higher than that of the first two months. The total value of exports was 3.77 trillion yuan, up by 6.7% while the total value of imports was 3.24 trillion yuan, up by 0.3%. The trade balance was 529.7 billion yuan in surplus, up by 75.2% over that of the same period last year. The trade structure continued to be optimized. The value of general trade grew by 6 %, accounting for 59.6% of the total value of imports and exports, 1.3 percentage points higher than that of the same period last year. The export of electrical and mechanical products increased by 5.4%, accounting for 58.8% of the total value of exports. The total value of imports and exports by private enterprises went up by 9.9%, accounting for 40.6% of the total value of imports and exports, 2.3 percentage points higher than that of the same period last year. In March, the total value of imports and exports was 2.46 trillion yuan, up by 9.6% year-on-year, which was 8.9 percentage points higher than that of the first two months. To be specific, the total value of exports was 1.34 trillion yuan, up by 21.3% while the total value of imports was 1.12 trillion yuan, down by 1.8%. 

In the first quarter, the export delivery value of industrial enterprises above the designated size reached 2.77 trillion yuan, up by 4.8% year-on-year. In March, the export delivery value of industrial enterprises above the designated size stood at 1.03 trillion yuan, up by 5.7%.

7. Consumer prices rose slightly and producer prices for industrial products experienced modest growth.

In the first quarter, consumer prices went up by 1.8% year-on-year, 0.2 percentage point higher than that of the first two months, or 0.3 percentage point lower than that of the same period last year. To be more specific, prices went up by 1.9% in urban areas and up by 1.8% in rural areas. Grouped by commodity categories, prices for food, tobacco and liquor went up by 2.2%; clothing increased by 1.8%; housing went up by 2.1%; articles and services for daily use rose by 1.3%; transportation and communication went down by 0.8%; education, culture and recreation increased by 2.6%; medical services and health care went up by 2.7%; and other articles and services rose by 2.1%. In terms of food, tobacco and liquor prices, prices for grain went up by 0.5%, pork fell by 1.2%, and fresh vegetables rose by 6.9%. In March, consumer prices went up by 2.3% year-on-year, 0.8 percentage point higher than that of last month, or down by 0.4% month-on-month.

In the first quarter, producer prices for industrial products went up by 0.2% year on year, 0.1 percentage point higher than that of the first two months, or 3.5 percentage points lower than that of the same period last year. In March, the producer prices for industrial products went up by 0.4% year-on-year, 0.3 percentage point higher than that of February, or up by 0.1% month-on-month. In the first quarter of 2019, the purchasing prices for industrial producers were up by 0.1% year-on-year and in March, it was up by 0.2% year-on-year, the same as that of February.

8. The surveyed unemployment rate in urban areas dropped slightly and the number of rural migrant workers continued to increase.

In the first quarter of 2019, there were 3.24 million new jobs in cities and towns across the country. In March, the national surveyed unemployment rate in urban areas was 5.2%, 0.1 percentage point lower than that of February. To be specific, the surveyed unemployment rate of people aged from 25 to 59 was 4.8%, 0.4 percentage point lower than that in urban areas. The urban surveyed unemployment rate in 31 major cities was 5.1%, 0.1 percentage point higher than that of last month. The employees of enterprises worked an average of 46.0 hours per week, which was an increase of 1.1 hours from February. At the end of March, the number of rural migrant workers reached 1.77 billion, 2.10 million more than that of the same period last year. This figure was up by 1.2%, and marked a 0.1 percentage point increase year-over-year.

9. Resident income grew steadily and the income growth of rural residents outpaced that of urban residents. 

In the first quarter, the nationwide per capita disposable income of residents was 8,493 yuan, a nominal increase of 8.7% year-over-year. The actual increase of price factor was 6.8%, 0.2 percentage point higher than the same period last year. In terms of permanent residence, the per capita disposable income of urban households was 11,633 yuan, an actual increase of 5.9%. The per capita disposable income of rural households was 4,600 yuan, an actual increase of 6.9 percent. The per capita disposable income of urban households was 2.53 times that of the rural households, 0.02 percentage point less than that of the same period last year. The median of the nationwide per capita disposable income was 7,158 yuan, a nominal increase of 8.8%.

10. Economic structure has been optimized, transformation and upgrading have achieved remarkable results.

The supply-side structural reform has been further advanced. In the first quarter, the national industrial capacity utilization rate reached 75.9%, the second highest level since 2013 compared with the same period in the past. At the end of March, the floor space of commercial buildings for sale was 516.46 million square meters, 6.05 million square meters less than at the end of February, and down by 9.9% year-over-year. At the end of February, the asset-liability ratio of industrial enterprises above the designated size was 56.9%, down by 0.2 percentage point year-over-year. In the first quarter, the investment in ecological protection and the environment governance, and the railway transportation industry went up by 43.0% and 11.0% respectively, 36.7 percentage points and 4.7 percentage points higher than the growth rate of the total investment.

Steady progress was made in advancing the "three critical battles"– preventing and defusing financial risks, conducting targeted poverty eradication and controlling pollution. At the end of February, the balance of local government debt stood at 19.14 trillion yuan, which was within the limit approved by the National People's Congress. The work in poverty eradication has progressed steadily, with the per capita disposable income for rural households in impoverished areas registering fast growth. The work of pollution prevention and control has continued to show results and the share of clean energy consumption has increased. According to preliminary estimates, the share of consumption of clean energy such as natural gas, hydropower, nuclear power and wind power in total energy consumption in the first quarter was 1.5 percentage points higher than that of same period last year. The energy consumption per unit GDP went down by 2.7% year-over-year. 

The economic structure has been optimized continually. In the first quarter, the value added of the tertiary industry accounted for 57.3% of total GDP, up 0.6 percentage point year-over-year, 18.7 percentage points higher than that of the secondary industry. It contributes 61.3% to GDP growth, which is 24.4 percentage points higher than that of the secondary industry. Consumption continued to perform as the dominant driving force from the demand side with final consumption expenditure contributing 65.1% to GDP growth. Service consumption took up 47.7% of households' final consumption expenditure, 1.4 percentage points higher than that of the same period last year. With the integrated development of the eastern, central, western and northwestern regions, achievements in the coordinated development of the Beijing-Tianjin-Hebei region has made good progress. There has also been accelerated implementation of close coordination on environmental protection along the Yangtze River Economic Belt. The integrated development of the Yangtze River Delta has steadily advanced and the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area has been released. The building of the Hainan Pilot Free Trade Zone and its layout of development has also been further improved. 

11. Market expectations improved notably and the confidence in development has been strengthened.

The Manufacturing Purchasing Managers' Index (PMI) returned to the expansionary range. In March, the Manufacturing PMI was 50.5%, 1.3 percentage points higher than that of February. This brought it back to the range of expansion after staying below the threshold for three months in a row. All five sub-indices rebounded, among which the Production Index and the New Orders Index went up by 3.2 percentage points and 1 percentage point respectively. The Production and Operation Expectation Index was 56.8% , 0.6 percentage point higher than that of February. The Business Activity Index for Non-Manufacturing Industries stayed within the range of expansion. In March, the Business Activity Index for Non-Manufacturing Industries was 54.8%, 0.5 percentage point higher than that of last month. The Business Activity Index for services was 53.6%, 0.1 percentage point higher than that of last month. The New Orders Index for services stayed within the expansionary range for three consecutive months. The Business Activity Index for construction stood at 61.7%, within the expansionary range. The Composite PMI Output Index showed a marked rise. In March, the Composite PMI Output Index was 54%, 1.6 percentage points higher than that of last month. The expansion of production and operation of enterprises accelerated in general. In the first quarter, the Consumer Confidence Index was 124.6, 3.2 percentage points higher than that of the fourth quarter last year.

Generally speaking, the national economy performed within an appropriate range in the first quarter, sustaining the momentum of progress with growing positive factors in the economy's overall stability. This has laid a sound foundation for the stable and healthy economic development of the whole year. However, at the same time we should also be aware that given slowing global economic growth and international trade as well as growing international uncertainties and prominent domestic structural issues, the task of reform and development is arduous and an economic downward pressure still persists. At the next stage, taking Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guideline, we should fully implement the spirit of the Central Economic Work Conference and the decisions of the Report on the Work of the Government. We should also follow the general working guideline of making progress while maintaining stability, focus on supply-side structural reform, and make continuous efforts to win the "three critical battles." In addition, we should also take coordinated steps to achieve steady growth, advance reform, make structural adjustments, improve living standards, guard against risk and maintain stability. We want to also fully mobilize the initiative of all sectors of the society, and redouble efforts to implement policies in order to make the national economy perform within an appropriate range and promote high-quality development. Thanks!

Shou Xiaoli:

Thank you, Mr. Mao. So now we will open the floor to questions, please identify the news organization you represent before asking your question.

CCTV:

According to your briefing, China's economic growth in the first quarter exceeded expectations. The statistics in the industrial and consumption fields were both higher than expected, and major indexes have rebounded. What's your view on China's economic performance in the first quarter? Thank you.

Mao Shengyong:

Statistics show that China's economic performance was stable in the first quarter. In particular, many indexes in March were higher than expected. People have been increasingly optimistic about the market and the number of positive factors has increased. Since the beginning of the first quarter, the Chinese economy has enjoyed steady performance while gathering momentum. I would like to summarize the situation into three points, which may sound cliché, but contain new information.

My first point of view is that the economic performance stayed within a reasonable range. This was shown by the main economic indexes, such as growth, employment, price and income.

Firstly, in the first quarter, GDP grew by 6.4%, obviously higher than market expectations. The figure was previously expected to be 6.2 percent or 6.3 percent.

Second, regarding employment, the surveyed unemployment rate of urban areas was registered at 5.1%, 5.3% and 5.2% in the first three months respectively. The figure dropped 0.1 percentage point from 5.3% in February to 5.2% in March. In the first quarter, the number of newly employed people in urban areas totaled 3.24 million, fulfilling 29.5% of the annual target. The general situation on employment has been stable.

Third, regarding price, the consumer price index (CPI) continued to rise slightly, up by 1.8% on average in the first three months. The producer price index for industrial products (PPI) continued to rise modestly, up by 0.2% on average in the first three months. In March, the CPI growth rate was a bit higher, up by 2.3% year-on-year, while PPI rose slightly by 0.4% year-on-year. The changes show that demand and supply in the market have been more balanced. While supply was sufficient in quantity and better in quality, prices rose slightly, indicating that market demand had improved.

Fourth, regarding income, in the first quarter, the real increase of personal per capita disposable income was 6.8%, 0.2 percentage points higher than the same period of last year. Taking into account the GDP growth rate of 6.4%, the growth of income outpaced GDP in the first quarter. In addition, the gap between the income of urban and rural residents narrowed. The per capita disposable income of urban residents was 2.53 times that of rural residents, 0.02 less than that of the same period last year.

The main indexes indicated that China's economic performance stayed within a reasonable range. This was not easy. 

The second point is that the economic structure has been optimized and upgraded. The structural reform of the supply side has continuously advanced this year. Three hard battles against grave risks, poverty and pollution are yielding results. The economic structure is continually developing in the direction of optimization, adjustment and upgrading. 

This can be seen according to the following angles. First, in terms of industrial structure, the service sectors have maintained comparative fast growth. The proportion of added value of the service sectors to GDP continuously increased in the first quarter, hitting 57.3%, up 0.6 percentage point year-over-year, and the rate of increase is higher than that in the same period last year. Second, in terms of the structure of industries, the growth of high-tech industries and strategic emerging industries remains comparatively fast, up 7.8% and 6.7% respectively. Third, the modern service industries have also kept up rapid growth.

Secondly, in terms of the structure of demand, first of all, the foundation for consumption to play a core role or act as a leading power to stimulate demand is comparatively solid. The contribution rate of consumption to economic growth was 65.1% in the first quarter. Among all residents’ consumption expenditure, service consumption accounts for 47.7%, up 1.4 percentage points year-over-year, which means the consumption structure is improving. Second, investment has maintained momentum through a modest rise, and the internal structure of investment is being further optimized. Investment in technical reform, high-tech industries, social fields and some short-slab fields have maintained relatively fast growth, which will add more impetus to future development. Third, the structure of foreign trade is being enhanced. The General Administration of Customs also released relevant data showing that in the first quarter, the share of general import-export trade is 1.3 percentage points higher than that in the same period last year. 

Thirdly, in terms of regional structure, the coordination among regional developments has improved. The eastern region continues to play a leading role in innovation-driven upgrades and development. The first-quarter total growth of the added value from high-tech manufacturing in the eastern region was faster than in January and February, and the input in research and development is also increasing continuously. The growth rates of industry and investment in the central and western regions are markedly higher than the national average, showing growing advantage to accepting industries transferred from the east. Although the growth speed of northeast China is a bit lower than the national average, an accelerating trend compared with the same period of last year is evident. The key regional development strategies, such as the Yangtze River Economic Belt, Beijing-Tianjin-Hebei Coordinated Development, and Guangdong-Hong Kong-Macao Greater Bay Area, are all making solid progress.

My next point relates to the notable improvement in market expectations. It is self-evident that the external environment since the second half of last year has been less promising. Based on certain global statistics, growth in international trade and the global economy is slowing, and some leading indicators have also experienced recession to varying extents, which all contribute to lower expectations for global economy. Nevertheless, the confidence and prospects for China's economic growth have steadily improved, which came not without effort, as China owes its stronger market expectations and confidence to the introduction and implementation of a series of policies for reform and opening up. Policies ensuring tax cuts and fee reductions on a larger scale and with greater efforts, which was introduced at this year's NPC & CPPCC sessions, provided a huge boost to the market. Compared with the statistics from February, the PMI in March saw a rise of 1.3 percentage points, while the Business Activity Index for Non-Manufacturing Industries in March also grew by 0.5 percentage point. Additionally, the Consumer Confidence Index was 3.2 percentage points higher than that of the fourth quarter last year.

In addition, some international organizations also raised their expectations of China’s economic growth. For example, the IMF, in its latest report, raised the expectation from 6.2% to 6.3%. Some international investment banks, too, are raising their outlooks on China’s economic growth. Therefore, both Chinese producers and consumers, and foreign organizations have an optimistic outlook on China’s economic growth, and their confidence in Chinese market has increased. Faced with various uncertainties from the external environment and tough challenges posed by domestic reforms, it is not an easy thing to achieve this greatly improved confidence in the market.

However, we should also be aware that at present, the growth of the global economy and of international trade are slowing, and there are still many international uncertainties. Although China's GDP grew by 6.4% in the first quarter of this year, and generally performed better than market expectations, it still declined compared with the same period last year, as well as with last year on the whole, suggesting that the economic downward pressure persists. Therefore, in the next period, we will follow the decisions and arrangements set by the CPC Central Committee and the State Council, and will better implement major policies and measures to ensure the economy operates in an appropriate range, and to march on toward high-quality development. Thank you.

China Business Network:

You have just mentioned that the economic performance figures in March are relatively good, what's the reason behind it? The performance in the first quarter is in line with that of the fourth quarter last year and better than the market expectation. Can you give an analysis of future economic performance?

Mao Shengyong:

Thank you for your question. Last month when I released figures here, people were concerned that the economic performance in the first two months was not so good, but figures in March are now excellent. Some indexes remarkably rebounded and the added value of the industrial enterprises above designated size increased by 8.5%, 3.2 percentage points higher than that of the first two months. Overall investment has picked up and consumption has accelerated slightly. The pickup rate of exports in March exceeded 20% and some indexes rebounded significantly and performed better than expected. 

Generally, the improvement of those indexes can be attributed to the following reasons:

First, there are positive effects of the policies. During the fourth quarter of last year, we carried out six principal policies to stabilize the economy and they are now taking effect. At the beginning of this year, we have continued to implement a series of policies in a bid to expand investments and stimulate consumptions. Meanwhile, the Government Work Report issued in this year's Two Sessions has given birth to a slew of tax reduction polices, which will be specified in the near future. The positive signals released from the trade negotiations between China and the United States have also yielded positive results. The combination of those factors has boosted the confidence of businesses.

Second, stimulated by the policies, businesses and markets have higher expectations and additional growing confidence in the market. Early signals of improvement are already visible. 

Third, the Spring Festival had an impact on deviating the economy from its normal trajectory. Influenced by the particular earliness of this year's festival, the data in the first two months of this year showed signs of declining but eventually rebounded in March. Therefore, we’d better neglect the impact of the festival factor in specific months and hold a panoramic view of the entire quarter while comparing them with those in the same period last year. Many indexes in the first quarter this year dropped year over year, but they almost all are now equal to the data from the fourth quarter of last year and some of them are even higher.

To your question, there are some industrial indexes for reference. When getting the first glimpse of the data, we truly feel it was beyond our expectations. But it becomes rational when putting into scrutiny. Why? Just like what I have said, we need to take a look at the general factors: first, the factor of policies, which stimulate the positive effects of enterprises; second, the factor of enterprises' expectations, which are growing higher and higher; and third, the lowered value-added tax rate, which is considered highly important. For instance, the rate of value-added tax in manufacturing industries has fallen from 16% to 13% since April 1 of this year. Therefore, to enjoy the tax-rebating policies as much as possible, many enterprises asked for more supplies in order to increase their inventories. At the same time, the suppliers from the upstream industries are stimulated to expand their productive capacities. That can better explain the third factor. Fourth, we still need to take into consideration the factor of the Spring Festival. The economy of the industrial enterprises above designated size grew by 5.3% year-by-year in the first two months this year. But the figure could have been 6.1% had the impact of the festival been ignored. However, the growth of 8.5% in March should also be partly attributed to the festival factor. All in all, the industrial economic growth of 6.5% in the first quarter this year sustained a good momentum. This is the answer to your first question.

For the second question, about whether there's sustainability in the next step. For example, from the perspective of industrial growth, some of the factors just mentioned are short-term factors, some are medium- and long-term factors. But in combination, for example, the basis or favorable conditions for supporting the smooth operation of industry is relatively large or many.

The first favorable factor is, starting from April 1, the policy of lowering the value added tax rate has already been implemented, and the supporting rules and details will come out soon. After May 1, the cut of enterprise contributions to social insurance will also be implemented. A series of policies will be implemented, reducing the burden on enterprises and facilitating enterprises wanting to expand investment and increase production.

The second favorable factor is, based on the current situation, the role of finance to serve the real economy is strengthening, and the prudent monetary policy is flexible and appropriate. We see that market liquidity is reasonably abundant. From this perspective, the financial environment for the development of the real economy has improved slightly.

The third favorable factor is export. Exports increased by 21.3% in March, a significant increase of 21.2 percentage points compared with January to February. This was also affected by the factors just mentioned. Export growth in the first quarter was good. For the next stage, exports are still expected to maintain a certain growth. Judging from the situation we know, including from the survey and the data in early April, we see that exports can still maintain a certain growth. From historical data, we see that the growth rate of industrial enterprises above the designated size and the growth rate of exports are closely linked, and it is also a strong supporting force for the steady growth of the industry.

Therefore, many favorable factors support the steady growth of the industry in the next stage. Of course, we also see that there are many external uncertainties, and the growth rate of profits of industrial enterprises above the designated size has slowed. These are negative factors. Taken together, the growth of industrial enterprises above the designated size is unlikely to be as encouraging as what we've seen in March, but the industry can still maintain a stable and healthy development based on conditions and supports.

Bloomberg:

You said that consumption contributed to a higher economic growth. What role did investment play? Is the situation sustainable? As to the decline in vehicle sales, if the cut in vehicle purchase subsidy in the second quarter affect the sales, will the Chinese government introduce some measures?

Mao Shengyong:

Thank you for your question. The fundamental role of consumption in producing economic growth has been strengthening in recent years. First, in terms of spending, the contribution of demands is in a state of flux. In the first quarter, the three major forces driving economic growth, namely consumption, investment and external demand performed well, to a greater or lesser degree. Consumption maintained a rapid growth, and investment increased at a higher rate. Foreign trade, in both goods and services, also registered a good performance. However, an increase in the contribution of one force means a decrease in the other two. In the first quarter, consumption made the largest contribution making up 65.1% of economic growth, performing as the dominant driving force. In the first quarter of last year, foreign trade played a negative role in promoting economic growth, with the net exports registering a negative contribution rate. In the first quarter of 2019, China’s surplus in trade in goods went up by 75.2% over that of the same period last year, indicating an increase in the contribution of net exports. Actually, the contribution made by the net exports of goods and services grew to 22.8%. In addition, despite higher growth of investment and rising capital formation, the contribution of gross capital formation stood at 12.1% – 28.3 percentage points lower than that of the same period last year. Although the respective contribution of the three major demands has changed, consumption, the proportion of which was above 60%, was still the largest contributor in absolute terms.

Second, the contribution of consumption has hovered around 60% in recent years, but has exceeded 70% or even approaching 80% in some individual quarters. This is a testament to the strengthening fundamental role of consumption in promoting economic growth.

Meanwhile, we need to be aware that the potential of consumption has yet to be maximized. China's consumption environment needs further improvement. Some incidents in recent years have added a new urgency to strengthen protection of consumers' rights and interests. Besides, consumption upgrades call for more supply of quality products and services. Therefore, there's still much room for China to unleash its consumer market potential.

Regarding your second question, the fall in car sales has drawn great public attention. Recent statistics show that there was a moderate slowdown in car production and sales. Domestically speaking, it resulted from the booming development of the Chinese car industry in the past 10 years. Car production and sales grew very quickly during that period. But the number of car owners among residents has increased continuously until today. This is the basic situation. The production and sales of cars are likely to enter a short period of adjustment. In some major developed countries, car production and sales have slowed down as well. This is my first point of view.

Second, the statistics in March show that although car production has continued to drop, the speed of the decline has slowed down. The value added of the industry actually saw a positive growth. This means that the upgrading of the industry is accelerating. The situation was the same regarding sales. Therefore, after a period of adjustment, the rate of decline of production and sales will decrease further. 

Third, when analyzing China's car market, we should focus on new cars. Approximately 28 million new cars were sold in 2018. However, we should also pay attention to used cars, because that market has been expanding. Last year, nearly 14 million used cars were sold, accounting for half of the number of new cars sold. The growth rate exceeded 10%. In the first quarter, the transaction of used cars increased both in terms of the number of cars sold and in terms of their transaction value. Therefore, we should consider both new cars and used cars when analyzing China's car market. From what we can see, the used car markets in developed countries are all vibrant. Thank you.

China Global Television Network (CGTN):

We know that the Sino-U.S. trade frictions have persisted for one year since March 2018. I'd like to ask how the trade friction has affected the economic data in the first quarter. Could you please give an analysis on it? Thank you.

Mao Shengyong:

Thank you for your question. Since the second half of 2016, the world economy has recovered following seven to eight years of adjustment. In 2017, the overall recovery momentum of the world economy was relatively strong, but since 2018, it has been slowing down. Later, we find that global economic growth is slowing down and international trade expansion is also slowing down. What is the reason? I think a very important reason is that the rise of international trade protectionism started to intensify in 2018, indicating that protectionism is not conducive to economic growth or world trade growth, and is harmful to the world economy.

As for the issue of Sino-U.S. economic and trade frictions you have asked, the Sino-U.S. economic and trade consultations have been carried out for nine rounds, and positive signals have been continuously released, indicating that the negotiations have made substantial progress. We have seen that every time the Sino-U.S. economic and trade consultations release a positive signal, the international capital market and international companies respond positively, and the market shows a very active state. To strengthen economic and trade exchanges and maintain normal mutually beneficial economic and trade cooperation is not only beneficial to both sides, but also conducive to the development of the world economy and the recovery of international trade. Thank you.

Beijing Business Today:

According to the statistics regarding housing prices in March, the number of cities with increasing sales prices month-on-month of both newly-constructed and second-hand residential buildings is rising. What's your response to this situation? Meanwhile, the growth of the total investment in real estate development in the first quarter is notably faster than that of 2018 and that of the same period last year. What kind of trend does it imply in the real estate market? How much does it contribute to the fix-asset investment? Thank you.

Mao Yongsheng:

Thank you for your question. There are two issues, the first is about housing prices and the second is about real estate development investment. Judging from the house price data of 70 large and medium-sized cities nationwide in March released yesterday, the growth of house prices in first and second tier cities is either slowing or lower year-on-year. In general, house prices in China have overall stability, as the growth in the majority of cities has been subdued and even dropped in some cities. Stability is still the general trend of housing prices. Nevertheless, differences surely exist due to imbalanced regional development, in which growth has been less synchronized.

Regarding the second issue, since last year, real estate development investment has been maintained at around 10%. Over the first quarter of this year, the growth of real estate investment has accelerated. This is due to two reasons: the first is the stabilization of housing prices; and the second is the rise of floor space under construction. Regarding your question about the impact of accelerated investment in real estate: accelerated investment and enlarged floor space now under construction can help to relieve the pressure of rising house prices, increasing the supply of real estate, and better achieve the balance between supply and demand in the market.

From the perspective of the real estate market, the public's expectations are relatively stable. The market positioning of "staying and not speculating" has become clearer. The house is the property of residence. and the property of consumption. We need to improve the quality of demand and the development of new urbanization. It should be clarified that we need to limit home purchases to rein in speculative and investment-driven housing demand. We also need to reinforce the regulation and governance of local government to adapt the policy based on practical situations and enhance management ability. On the whole, the real estate market is expected to be relatively stable, the land price is generally stable, and the house price operation is relatively stable. Thank you.

China News Agency:

We have seen that the GDP growth rate in the first quarter of this year remained flat with little fluctuation compared with that in the fourth quarter of last year. Some people questioned the stability of China's economic growth over the years, during which the data of other countries fluctuated. What do you think of it? Thank you.

Mao Shengyong:

We have learned about what you mentioned through various channels, and I would like to respond to it. We know that China's economy has shifted from high speed growth in the past to high-quality development. In this new phase, the economic growth has slowed down from rapid speed in the past to medium-to-high speed growth. However, while the growth rate is decreasing, the economic operation is becoming more stable. In fact, it reflects the change of the economic development phases and not the smoothing out of economic growth fluctuations. The reasons are as follows:

First, in terms of total volume, China's economic aggregate is growing increasingly larger, with total economic output exceeding 90 trillion yuan in 2018. The increasing amount of money means that economic growth may slow down on the one hand, but it also means that economic growth is not prone to rapid fluctuations and will show greater stability. The larger the economic aggregate is, the less likely it is to fluctuate. But as the economic aggregate becomes larger, every percentage point of growth can bring about incremental economic growth.

Second, from the perspective of industrial structure, the proportion of the service industry's value added in GDP has exceeded that of the secondary industry and become the largest industry since 2012. The service industry has maintained rapid growth ever since, and the proportion of its value added in GDP has continued to increase, sustaining an increasing contribution to overall economic growth. In the first quarter of this year, the contribution rate was 61.3%. In terms of the demand structure, the contribution of consumption to economic growth has been constantly consolidated. In the first quarter, the contribution rate of final consumption expenditure was 65.1%. In terms of production and demand, it is the service industry and consumption that contribute to production and demand respectively, and both of them feature fast growth. We know that consumption and the service industry also both have the very important feature of relatively small volatility, allowing these two leading forces to lead to more stable GDP growth.

Third, from the policy point of view, the CPC Central Committee and the State Council have continuously innovated in macroeconomic regulation and control, and on the basis of strengthening the range control, directional regulation, precise regulation, and camera regulation have been continuously strengthened, which have better responded to the downward pressure on the domestic economy. These efforts have kept the economy running smoothly in an appropriate range, which shows the effects of our policies.

Fourth, when developed economies, including the U.S., Japan and European countries release their quarterly GDP growth, sometimes they release annualized rates first, and then year-on-year rates. Annualized rates will amplify seasonality, both positive and negative, thus magnifying the fluctuation of statistics. For example, during the four quarters of 2018, the first quarter ranked the highest at 6.8%, while the last quarter ranked the lowest at 6.4%. The range of annual economic growth is 0.4 percentage point. Whereas the statistics of the U.S. in 2018 are 3.0% and 2.6% respectively, and the corresponding range of growth is also 0.4 percentage point, which also seems to be fairly stable. However, when based on the perspective of annualized rate, in which the highest growth of the U.S. is 4.2% and lowest is 2.2%, the result is a 2-percentage-point range of discrepancy. This explains the reason why sometimes the annualized rate published by developed countries seem to indicate significant fluctuations while China’s numbers show more stability. This is because the statistics published by China refers to the year-on-year growth and those of foreign countries are based on an annualized rate. If we review the year-on-year growth for both, the statistics released by China and foreign countries remain relatively stable.

Over the past years, people may neglect that the National Bureau of Statistics has also released the quarter-over-quarter growth rate apart from year-over-year rates when publishing the quarterly GDP. If you have interest, you can make some derivation based on the quarter-over-quarter speed of growth and see its annualized rate. Based on our rough calculation, we note that if the annualized rate is determined on the basis of the quarter-over-quarter growth rate, its fluctuation rate is higher than the year-over-year growth rate.

Generally, Chinese economic performance is stable now, which is a manifestation of the objective rules of China’s economic development in the current phase, and is also in line with the international rules of development. It also showcases the effect of policy tuning, rather than deliberately concealing economic fluctuations through statistics. 

Reuters:

According to the statistics you just released, the economic growth in the first quarter was better than expected, and previous policies are paying off intially. Do you think there will be fewer policies to stabilize economic growth in the next stage, especially monetary policies, such as cutting interest rates and required reserve ratios?

Mao Shengyong:

First, in the first quarter, economic performance was quite stable and better than expected. Second, for the next stage, the positive factors for economic growth are accumulating and the market outlook is improving. For the next step, a lot of policies will be implemented and effective, cementing the foundation for steady economic performance. Third, we should notice that the downward economic pressure still exists. There are many uncertainties from the external environment, and the growth of the global economy and international trade is slowing down. Domestically, we also have many structural issues. The growth rate of 6.4% is lower than the same period of last year and the whole year. All of these show that we face pressures in terms of economic performance. Particularly, the real economy was faced with issues such as rising costs and a decline in profit-making.

We have rolled out many polices, and most importantly, our departments and local authorities need to implement the major polices made by the Central Committee of CPC and State Council in both letter and spirit, and give full play to these policies, so as to facilitate steady and healthy economic growth and a higher quality for Chinese economy. Thank you.

ShouXiaoli:

Thank you, Mr. Mao. Thank you, all the journalists. That is the end of today's press conference. Goodbye.

.

Read in Chinese

Speakers:

Liu Yuejin, deputy director of China's National Narcotics Control Commission and counter-terrorism commissioner of the Ministry of Public Security;

Wang Hesheng, deputy director of the National Health Commission;

Chen Shifei, deputy head of the National Medical Products Administration;

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office of China

Date:

April 1, 2019

   

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to today's SCIO briefing. Today, the "Statement on Adding Fentanyl-related Substances to the Supplementary List of Controlled Non-medical Narcotic Drugs and Psychotropic Substances" was jointly issued by China's Ministry of Public Security, National Health Commission, and National Medical Products Administration. This statement means that the Chinese government has officially begun to include all fentanyl-related substances into the control list. To offer more information on the announcement, we are delighted to welcome three officials to update you on the fentanyl-related substances control and answer your questions. They are Mr. Liu Yuejin, deputy director of China's National Narcotics Control Commission and counter-terrorism commissioner of the Ministry of Public Security; Mr. Wang Hesheng, deputy director of the National Health Commission; and Mr. Chen Shifei, deputy head of the National Medical Products Administration.

Liu Yuejin:

Ladies and gentlemen, good morning! Now, on behalf of the National Narcotics Control Commission, I read out the "Statement on Adding Fentanyl-related Substances to the 'Supplementary List of Controlled Non-medical Narcotic Drugs and Psychotropic Substances' issued by the Ministry of Public Security of the People's Republic of China, National Health Commission of the People's Republic of China and National Medical Products Administration."

In accordance with the provisions of "Regulations for Controlling on Narcotic Drugs and Psychotropic Substances" and "Methods for Controlling Non-medicinal Narcotic Drugs and Psychotropic Substances," the Ministry of Public Security, National Health Commission and National Medical Products Administration have decided to add fentanyl-related substances into the "Supplementary List of Controlled Non-medicinal Narcotic Drugs and Psychotropic Substances."

"Fentanyl" refers to a substance that has one or more of the following chemical structures:

1. Uses other acyl groups to substitute for propionyl;

2. Using any substituted and unsubstituted mono-aromatic groups to substitute for phenyl directly connected with nitrogen atoms;

3. Piperidine ring having substituent groups such as alkyl, alkenyl, alkoxy, ester, ether, hydroxy, halogen, haloalkyl, amino and nitro; 

4. Using any other groups (except hydrogen) to substitute for phenethyl.

If the substances listed above are found to have any legitimate pharmaceutical, industrial, scientific research or other legal use, they shall be adjusted in accordance with the second paragraph of Article 3 of the "Methods for Controlling Non-medicinal Narcotic Drugs and Psychotropic Substances."

The fentanyl-related substances that have been included into the "List of Narcotic Drugs and Psychotropic Substances" and the "Supplementary List of Controlled Non-medicinal Narcotic Drugs and Psychotropic Substances" will be supervised and controlled in accordance with the original regulations.

This announcement will take effect on1 May, 2019. 

Ministry of Public Security of the People's Republic of China, National Health Commission of the People's Republic of China and National Medical Products Administration.

Just now, I have read out the announcement that China will include all fentanyl-related substances into the list of controlled drugs, which marks an important and innovative measure taken by the Chinese government in the building of China's anti-drug legal system.

Drugs are a public hazard to all mankind. This issue must be tackled because it concerns the future of mankind. China has knowledge of their harm as we have suffered from serious drug epidemics before. Since the founding of the People's Republic of China 70 years ago, the Party and the government have always attached great importance to anti-drug enforcement. We have consistently pursued and strictly carried out anti-drug policies and adopted the guidelines of comprehensive governance; prevention first; and the four prohibitions of drug abuse, trafficking, cultivation and production. In particular, since the 18th National Congress of the Communist Party of China, General Secretary Xi Jinping has laid out important instructions on drug control many times, stressing that political and institutional advantages should be given full play to improve the drug control governance system, and responsibilities be shouldered and the masses should be mobilized. Governance with Chinese characteristics should be followed to combat drugs and win the anti-drug war in the new era. China National Narcotic Control Committee and all local authorities and relevant departments resolutely implements the decisions of the central government and also take the initiative to tackle the difficulties. Hence, steady progress has been made in controlling drugs. At present, the world is undergoing profound and complex changes concerning drugs and the situation is not optimistic. In particular, new drugs represented by fentanyl-related substances have emerged at an unprecedented rate and have been abused on a large scale in some countries, claiming large numbers of lives and causing serious social problems. Facing this international challenge, the Chinese government has added all fentanyl-related substances into the control list. It is not only an important move to prevent the risks caused by the new drugs, but also a measure to protect people's physical and mental health. It is an important manifestation of China's participation in the global control of illicit drugs and the maintenance of international security and stability.

Adding all fentanyl-related substances into the control list is one of the innovative measures that China is taking to tackle the drug problem, bringing opportunities for us to deepen reform and development in our drug control efforts. The Ministry of Public Security, National Health Commission, National Medical Products Administration and other related departments have closely coordinated on a series of relevant studies, risk assessments, expert evaluations, and suggestions. As a result, they have managed to complete the legal procedures to schedule such substances within four months. In particular, the legal definition of fentanyl-related substances has been scientifically determined, which guarantees an extensive and expandable scope of control while ensuring minimum impact on medical industry, scientific research and other legitimate uses.

After issuing and implementing the announcement to list and regulate the entire class of fentanyl substances, the Chinese government will draft and issue a series of documents as soon as possible. This will also include guidance on applicable laws for handling criminal cases related to fentanyl substances as well as protocols for the filing and prosecution of similar cases. The authorities will push for the construction of laboratories that can examine related drugs, develop universal on-site rapid screening equipment, safety protection equipment, formulate public safety industry standards for the inspection and identification of fentanyl substances, and push for the construction of a monitoring system for fentanyl substances based on suspicious substances and spectrum analysis. It will also reinforce the monitoring, on-site inspection, examination, identification and risk assessment of fentanyl substances. In addition, it will provide efficient technical support for daily supervision and law enforcement, and ensure that the regulation of fentanyl substances falls within law enforcement and judicial practices.

Cooperation creates synergy, and co-governance leads to a win-win result. The Chinese government is willing to share its drug control experiences with the world and tackle the drug problem together. The government also wishes to offer Chinese wisdom to address global drug control issues and contribute to the process of building a community with a shared future for humanity as well as promoting peace and development in the world.

Next, my colleagues and I will answer your questions. 

Hu Kaihong:

Thank you, Mr. Liu. Let's start the questions. Please identify the news organization you represent before asking questions.

CCTV:

As far as I know, China has adopted very strict regulatory measures for fentanyl, and the varieties of control have surpassed the varieties of the United Nations. Why do we need to include all fentanyl-related substances into the control list? Thank you.

Liu Yuejin:

Fentanyl-related substances are new synthetic drugs that have only appeared in recent years and have spread rapidly in countries such as the United States and Canada. Due to its strong toxicity and vast variety , this type of substance has become a major problem for international drug control efforts. In this regard, China's anti-drug authorities have comprehensively adopted a series of measures such as increasing the variety of products under control, strengthening daily supervision, tightening inspections, innovating management and control measures, and strengthening international cooperation. China has already issued and implemented regulatory controls on 25 fentanyl-related substances, exceeding the 21 issued by the UN. These measures have effectively prevented the spread of such substances in China. In particular, we have strengthened supervision over the legal production of fentanyl-related drugs, and adopted a very strict process from production to use, completely eliminating abuse of fentanyl-related drugs produced by legitimate enterprises.

As everyone knows, China was historically suffered from drugs. After the founding of the People's Republic of China, the Communist Party of China (CPC) and the Chinese government rooted out drugs in three years, winning China the accolade of "drug-free country" around the world. With the continued spread of global drug trafficking, the drug problem has resurfaced in our country.

Since the 18th National Congress of the CPC, General Secretary of the CPC Central Committee Xi Jinping has attached great importance to anti-drug work and has given a series of important instructions, calling for joint efforts in global drug governance from the perspective of safeguarding of the health, safety and well-being of all human beings. This is pivotal if we are to build a community with a shared future for mankind. Last December, General Secretary Xi Jinping announced that China has decided to include all fentanyl-related substances into the control list, demonstrating China's commitment to participate in the global governance in drugs. It also demonstrates the Chinese government's firm determination on people-centered development and on safeguarding the health and well-being of all people. The decision has been based on the painful lesson from the United States.

We firmly believe that the decision to include all fentanyl-like substances into the control list will completely block all loopholes – currently abused by simply modifying one or several atoms. We will lay a solid legal foundation for public security, customs, as well as law enforcement and judicial departments such as the procuratorate and the courts, so that they can crack down on such criminal activities. We will also effectively prevent the massive abuse of fentanyl-related substances and illegal drug trafficking and smuggling activities, contributing Chinese wisdom and power to global drug control.

Phoenix Satellite TV:

The United States has accused China of being the main source of fentanyl-related substances. What do you think of this accusation? In addition, this time China will add all fentanyl-related substances into the control list. Do you think this move will be helpful to address the U.S. concern? Thank you.

Liu Yuejin:

The control of fentanyl-related drugs in China is very strict. Fentanyl-related drugs produced by legal manufacturers have never been abused, nor can they flow into the United States. China's law enforcement authorities have investigated and cracked down on several illegal cases of processing and trafficking fentanyl-related substances to the United States. All these cases were committed by both domestic and foreign criminals in collusion with each other. The drugs were transported to the United States in disguise or hidden in international parcels, but the number was extremely limited. It cannot be the main source to the United States. So, the U.S. accusation lacks evidence and goes against the facts.

The Chinese government has always adhered to the principle of strict drug control, earnestly fulfilling its international drug control obligations and actively participating in tackling the global narcotic drug abuse problem with the attitude of a responsible major country. The manufacturing, trafficking and abusing of fentanyl-related substances is an international problem, which is unlikely to be solved by relying solely on the efforts of a single country. It requires the joint efforts of all countries. The Chinese government is willing to work with the international community, including the United States, to study ways of responding to this global problem and controlling the use of psychoactive substances such as fentanyl.

We believe that the abuse of fentanyl-related substances in the United States is due to its own internal issues. The first is due to traditional causes. There is a widespread tradition of abuse of prescription painkillers in the United States, and Americans, who make up 5 percent of the world's population, consume 80 percent of the world's opioids. The second cause is the profit motive of drug companies. In order to maintain considerable profits, large-scale pharmaceutical companies have the tendency to fund experts to do research and conclude that opioids are harmless. Pharmacies are eager to sell them and doctors prescribe excess drugs, all of which form a complete profit chain of overlapping interests. Thirdly, supervision is weak and prescription drugs are not well regulated. Abusers can travel to another state to get more prescription drugs, and doctors can repeatedly prescribe the same drugs without supervision. This is a glaring loophole in the medical system. The fourth cause is cultural in nature. There is not enough publicity about the dangers of drugs. Some people have even linked drug use to "freedom," "personality" and "liberation" and more than half of the states in the U.S. have "legalized marijuana." These factors combine to create a large-scale abuse of fentanyl-related substances in the United States.

I believe that if the United States really wants to solve its fentanyl-related substance abuse problem, it needs to strengthen its work domestically. It should find the causes of the large-scale abuse of fentanyl-related substances, identify the abusing groups as well as the source of fentanyl-related substances and the channels used to smuggle and traffic the drugs. It must identify the crux of the problem and find the right solution. They must also strengthen drug prevention education, starting with reducing the demand and curbing the spread of fentanyl-related substance abuse. While intensifying domestic efforts to crack down on drug-related crimes, they should also carry out international cooperation and strengthen intelligence exchange, evidence sharing and joint investigations, instead of blaming other countries. Thank you.

CNN:

First, I would like to confirm with you the issue of overall control of fentanyl-related substances that you just mentioned. As neither of us are experts in the field, will the new regulation actually be able to block existing loopholes? Will the regulation cover all aspects no matter how illicit drug makers change the chemical compositions or structures? Or is this an open announcement that can be amended to adapt to different situations? I have another question. You must know that U.S. President Donald Trump is very concerned about the issue. In a Twitter post last December, he called for China to impose the death penalty on distributors and pushers of fentanyl-related substances as a means to solve the problem. As a Chinese law enforcer, what is your opinion on this? Finally, some Americans have been concerned that no matter what policies the Chinese central government introduces, local governments may not implement them or even totally ignore them due to corruption? How do you respond?Thank you.

Chen Shifei:

The purpose of drug control, in addition to preventing abuse, is to minimize the impact on legitimate medical needs and safeguard necessary clinical use. Therefore, in the process of argumentation for listing all fentanyl-related substances under control, we have mainly taken following measures: First, we have fully evaluated the varieties of all fentanyl-related substances and their potential legitimate use. Second, we have scientifically identified the scope of fentanyl-related substances, so as to avoid impact on legitimate medical use. Third, we have formulated regulations on exceptions. If any fentanyl-related substance under control is found to have legitimate application in the pharmaceutical, industrial, scientific or other sectors, we will make a dynamic adjustment between the non-medicinal and medicinal categories. Of course, with the gradual improvement of legislative techniques and administrative supervision methods, if we have better legislative methods or control measures in the future, we will make timely adjustments. Thank you.

Liu Yuejin:

The other question you've asked was about U.S. President Donald Trump's tweets regarding China's problems and speculations about the law enforcement process of fentanyl, including new psychoactive substances. Let me answer this question briefly. The Chinese government is resolutely committed to the fight against the drug-related crimes, and we have clear legal regulations on that. We have been highly concerned about new fentanyl drugs before they spread on a large scale. As many as 25 types of fentanyl-related substances and two other fentanyl precursor chemicals have been included onto our control list, exceeding the 21 categories under the UN rules. Moreover, regarding law enforcement, China has always acted strictly in accordance with the law to ensure the strict law enforcement. By scheduling the whole fentanyl-related substances, the Chinese government will crack down on all kinds of criminals in accordance with the law, showing no mercy. Thank you.

CNN:

First, I would like to confirm with you the issue of overall control of fentanyl-related substances that you just mentioned. As neither of us are experts in the field, will the new regulation actually be able to block existing loopholes? Will the regulation cover all aspects no matter how illicit drug makers change the chemical compositions or structures? Or is this an open announcement that can be amended to adapt to different situations? I have another question. You must know that U.S. President Donald Trump is very concerned about the issue. In a Twitter post last December, he called for China to impose the death penalty on distributors and pushers of fentanyl-related substances as a means to solve the problem. As a Chinese law enforcer, what is your opinion on this? Finally, some Americans have been concerned that no matter what policies the Chinese central government introduces, local governments may not implement them or even totally ignore them due to corruption? How do you respond?Thank you.

Chen Shifei:

The purpose of drug control, in addition to preventing abuse, is to minimize the impact on legitimate medical needs and safeguard necessary clinical use. Therefore, in the process of argumentation for listing all fentanyl-related substances under control, we have mainly taken following measures: First, we have fully evaluated the varieties of all fentanyl-related substances and their potential legitimate use. Second, we have scientifically identified the scope of fentanyl-related substances, so as to avoid impact on legitimate medical use. Third, we have formulated regulations on exceptions. If any fentanyl-related substance under control is found to have legitimate application in the pharmaceutical, industrial, scientific or other sectors, we will make a dynamic adjustment between the non-medicinal and medicinal categories. Of course, with the gradual improvement of legislative techniques and administrative supervision methods, if we have better legislative methods or control measures in the future, we will make timely adjustments. Thank you.

Liu Yuejin:

The other question you've asked was about U.S. President Donald Trump's tweets regarding China's problems and speculations about the law enforcement process of fentanyl, including new psychoactive substances. Let me answer this question briefly. The Chinese government is resolutely committed to the fight against the drug-related crimes, and we have clear legal regulations on that. We have been highly concerned about new fentanyl drugs before they spread on a large scale. As many as 25 types of fentanyl-related substances and two other fentanyl precursor chemicals have been included onto our control list, exceeding the 21 categories under the UN rules. Moreover, regarding law enforcement, China has always acted strictly in accordance with the law to ensure the strict law enforcement. By scheduling the whole fentanyl-related substances, the Chinese government will crack down on all kinds of criminals in accordance with the law, showing no mercy. Thank you.

Agence France-Presse (AFP):

The United States recently summoned several Chinese nationals for alleged crimes of trafficking fentanyl-related substances. What's your comment on this? What measures will China take?

Liu Yuejin:

China and U.S. law enforcement departments have been jointly investigating the cases you have mentioned. We work effectively and have a close relationship. So far, the Chinese side has not found any violation of Chinese law on the part of those Chinese nationals. The American side has also yet to present any evidence for their breach of Chinese law. Our cooperative investigation is still underway. However, the American side has already started the prosecution, among other measures, without communicating with us in advance. We regret over such approach, which has undermined our cooperation.

As for law enforcement, we will continue to keep a close eye on the investigation and prosecution enforced by the American side. On our part, we will also investigate these cases and people further. And we are ready to strengthen intelligence information sharing with our U.S. counterparts. Thank you.

China Daily:

What measures will you take to ensure the full and effective implementation for the decision to include all fentanyl-related substances onto the control list? And what will you do in terms of stepping up international cooperation to combat crimes in this field? Thank you.

Liu Yuejin:

In the legislation, after we have included all fentanyl-related substances into control list, the relevant authorities in the Chinese government will take a host of measures to ensure full and effective implementation. The main measures will be taken as follows:

First, we will run thorough investigations. There will be in-depth investigations into suspected bio-medicine bases and chemical parks to eradicate the illicit manufacturing of fentanyl-related substances. Information on the internet relating to drugs will be taken down, and we will cut off online communication and transaction channels for criminals.

Second, there will be an intensified effort to combat drug smuggling and trafficking. We will urge delivery companies to register the sender's real name, conduct out-of-the-box inspections and utilize security machines. More examinations will be done on international parcels in high risk customs clearance zones, and the proportion and frequency of inspections will be increased to prevent fentanyl from being smuggled out of the country.

Third, we will conduct criminal investigations. We will put together special teams to look into the smuggling, manufacturing and trafficking of fentanyl-related substances and other drugs.

Fourth, we will deepen law enforcement cooperation. China will take the initiative to strengthen information sharing and case cooperation with relevant countries to jointly investigate smuggling cases, and take the utmost effort to destroy transnational networks of drug smuggling.

Fifth, we will step up research on technology. More effort will be taken to develop examination and identification technologies, and to work on accelerating onsite investigation technology and developing lab testing equipment. We will develop a rapid assessment system for the fentanyl addiction in line with China's national conditions. 

In the next step, China will work with the international community, including the United States, in a joint response to combat the challenges posed by fentanyl-related substances. Thank you.

Yicai.com:

I have two questions. One is that, after including all fentanyl-related substances under control, will legitimate pharmaceutical companies producing related products see more rigid regulation to avoid their products being used illegally? The other is about industrial hemp that has received much attention recently. We noticed that the National Narcotic Control Committee has issued several statements before. We want to know if the many domestic companies involved in the planting and purification of hemp are acting legally and if there will be more rigid regulatory measures for industrial hemp in the future. Thank you.

Chen Shifei:

The Chinese government joined the United Nations' Single Convention on Narcotic Drugs in 1985. The former health ministry issued measures to control narcotic drugs in 1987, which listed fentanyl, sufentanil, and alfentanil as narcotics for regulation. The government has been taking rigorous measures to control narcotics through the processes of scientific research, production, distribution, use and export. All related scientific research programs require registration and approval. Production is limited to appointed manufacturers with the quantities prescribed. The distribution is also strictly confined to fixed channels to avoid related products entering illegal channels and causing undesirable consequences. A mechanism that involves producers, suppliers and medical institutions has been functioning well and prevented undesirable consequences from happening.

As for the export of narcotic drugs, we handle this with strict approval and control procedures within the framework of the UN. Currently, the amounts of exports are quite small. I think our current regulatory measures for narcotic drugs including fentanyl-related substances are efficacious and adequate. Thank you.

Liu Yuejin:

I will briefly answer the question regarding "industrial marijuana." Here in China, we have rigorous management procedures and total quantity control over the production, plantation, storage, and transportation of "industrial marijuana." All this has proceeded under the strict supervision and control of relevant government departments. Therefore, as far as this problem is concerned, there are no serious violations in our country. Currently, on the premise that many countries have legalized marijuana, China will tighten up its supervision and control over "industrial marijuana," close all loopholes, and improve all kinds of management systems. Thank you.

Financial Times:

Just now, Mr. Liu mentioned the cooperation between China and other countries. Here is my question for you. Are there any countries besides the United States that is concerned with the inflow of the illicit drug smuggled from China? I see lots of representatives from embassies seated here today. Could you please tell us about other countries' concerns, as well as China's cooperative endeavor with them? Thank you.

Liu Yuejin:

Regarding the fentanyl-related substances, the joint efforts in finding clues and the lawsuits involved, the US law enforcement authorities have remained China's major partners while pushing forward the smooth and close cooperation in exchange of intelligence and information, as well as joint detections. The US Drug Enforcement Administration (DEA) has been very pleased and complimented the overall cooperation with China's law enforcement authorities. In regards to other countries, especially European countries, China has worked with them in concerted efforts to detect and crack down on the new psychoactive substances other than fentanyl-related substances. These cooperations include exchanging intelligence, sharing information, and coordinating joint detections. The cooperation is also smooth. It should be mentioned that China has cooperated well with the rest of the world, in addition to the United States, in line with its anti-drug endeavor. Thank you.

Hu Kaihong:

The press conference ends here today. Thanks for our three guest speakers, and thank you, everyone.

Read in Chinese

Speakers:
Norbu Dondrup, a member of the Standing Committee of the Tibet Autonomous Regional Committee of the Communist Party of China and executive vice chairman of the regional government;

Dawa, deputy director general of the United Front Work Department of the CPC Tibet Autonomous Regional Committee;

Luo Jie, director general of Ecological Environment Department of the regional government;

Ren Jingdong, deputy director general of the Development and Reform Commission of the Tibet Autonomous Region and head of the Energy Bureau

Chairperson:
Hu Kaihong, spokesperson for the State Council Information Office of China

Date:
March 27, 2019

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this SCIO briefing. Today, the SCIO will brief the media about our white paper titled "Democratic Reform in Tibet - Sixty Years On". We are delighted to welcome the following attendees to today's briefing: Mr. Norbu Dondrup, a member of the Standing Committee of the Tibet Autonomous Regional Committee of the Communist Party of China and executive vice chairman of the regional government; Mr. Dawa, deputy director general of the United Front Work Department of the CPC Tibet Autonomous Regional Committee; Mr. Luo Jie, director general of Ecological Environment Department of the regional government; and Mr. Ren Jingdong, deputy director general of the Development and Reform Commission of the Tibet Autonomous Region and head of the Energy Bureau.

My name is Hu Kaihong, and I am a spokesperson for the State Council Information Office of China. First of all, I will give you an introduction about the white paper.

The white paper released today implements General Secretary Xi Jinping's important exposition on Tibet, by focusing on people-centered development that is innovation-driven, coordinated, green, oriented toward global progress, and beneficial to all. It is guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and the principles of the 19th CPC National Congress.

In order to make Tibet's development full of vigor and vitality, we have made great efforts to boost its economic and social development; safeguard and improve people's livelihood; promote interaction, communication and integration between ethnic groups; as well as strengthen eco-environment protection and construction. 

The White Paper focuses on the backwardness of Tibet's reactionary feudal serfdom in the past, the historical inevitability and significance of democratic reform in Tibet, the progress made through the reform, and the new look that Tibet puts on in the new era of development. With sufficient facts and a significant amount of data, the White Paper expounds that the democratic reform has been a magnificent revolution in Tibet's history with its great significance and far-reaching influence. The reform fundamentally transformed the social system of Tibet; emancipated and expanded the productive forces, and greatly promoted the overall progress of Tibetan society. It carries great significance in the history of the development of human society. 

The White Paper points out that the 60 years of great progress in Tibet bears testament to the fact that the reform conforms to the developmental path of the time, satisfies the essential needs of the different ethnic groups of Tibet, and is in line with the demands of Tibet's social development. This is an inevitability in Tibet's history of development. If the reform hadn't taken place, Tibet would not have been able to make the historic changes in its society and adapt to the developments of the time. Its residents also would not have been able to live happy lives and have their rights fully protected. 

Democratic reform is a heroic undertaking that has benefited Tibet's different ethnic groups. Through the reform, the people of all ethnic groups in Tibet have become the masters of the country. Deeply rooted in the hearts of the people is their dedication to unswervingly upholding the leadership of the Communist Party of China, the socialist path of development, and the system of regional autonomy for ethnic minorities. Now, under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the people of all ethnic groups in Tibet are striving, together with the whole nation, to create better lives for themselves and to realize the great rejuvenation of the Chinese nation. The mission to promote socialism with Chinese characteristics for a new era has been launched and the future of Tibet will grow ever brighter. 

The full text of the white paper is about 25,000 words. It consists of three parts: preface, body and concluding remarks. It has been published in Chinese, English, French, Russian, Spanish and Arabic by the People's Publishing House and Foreign Languages Press. It will be issued across the country by the Xinhua Bookstore.

Now I have briefly introduced the contents, I will give the floor to Mr. Norbu Dondrup to discuss the situation in Tibet since the democratic reform. 

Norbu Dondrup:

Ladies and gentlemen, journalists and friends, good morning. This year marks the 70th anniversary of the founding of the People's Republic of China. It is also the 60th anniversary of the democratic reform in Tibet. Before 1959, Tibet was a feudal serfdom society that was darker and backward than the European Middle Ages. In 1951, the Central People's Government and the local government of Tibet signed the "Agreement on the Peaceful Liberation of Tibet" (referred to as the 17-Article Agreement). Since then, Tibet has shaken off the fetters of imperialist aggression, achieved peaceful liberation, and created a basic premise to achieve common progress and development with other parts of the country.

However, with the support of the imperialist forces, some of Tibet's ruling elite ignored the people's rising demand for democratic reforms. They stubbornly opposed reform and attempted to maintain feudal serfdom and the unity of politics and religion forever.

On March 10, 1959, they publicly tore up the 17-Article Agreement and instigated a full-scale armed rebellion. In order to uphold national unity and safeguard the fundamental interests of Tibetan people, Chairman Mao Zedong and the CPC central committee, led the Tibetan people to put down the armed rebellion. On March 28, 1959, Premier Zhou Enlai signed an order to dissolve the local government of Tibet, ending the dark history of the feudal serf system and the integration of politics and religion in Tibet. 

Under the leadership of the Party, millions of serfs carried out vigorous democratic reforms; and eliminated the political, economic, cultural and social systems that protected the interests of their feudal serf owners. Having shaken off the shackles of being oppressed, exploited and enslaved, the feudal serfs were utterly liberated, becoming masters of their country and their society, and critically, masters of their own destiny. Tibet's democratic reform is the most extensive, profound and greatest social change in the history of Tibet's development. It is an epoch-making and significant historical event for the development of Tibet's society and human rights. It is also of great significance in the history of human civilization and the history of human rights in the world.

We hold grand ceremonies to mark the democratic reform in Tibet, which is a magnificent feat in the history of human civilization. It is of great significance for us to deeply implement the Party's policies on Tibet and put into practice Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era; particularly the principles from General Secretary Xi Jinping's major expositions on governing border areas and stabilizing Tibet as well as a series of major instructions on work in Tibet. It is also of great significance to encourage government officials and the people of all ethnic groups in Tibet to push forward Tibet's rapid development and long-term stability, and thus write a good Tibetan chapter in realizing the Chinese dream of great national rejuvenation.

In 2009, the Second Session of the Ninth National People's Congress of the Tibet Autonomous Region decided to set March 28th as the "Serfs Emancipation Day". The Serfs Emancipation Day was set up to let the Chinese people of all ethnic groups, including the Tibetan people, remember more firmly the great historical event of democratic reform in Tibet, which marks the watershed between the old and new societies; see more clearly the cruelty and darkness of old Tibetan feudal serfdom; see more clearly the reactionary nature of the Dalai Lama clique; cherish more consciously today's hard-earned happy life in Tibet; and work harder to create a beautiful future for new socialist Tibet.

Tomorrow, the Tibet Autonomous Region will have a series of commemorative celebrations. To mark this important day and event, the State Council Information Office today has issued a white paper titled "Democratic Reform in Tibet: Sixty Years On." It is the 14th book on Tibet published by the State Council Information Office.

Using a large amount of historical materials and comparisons between the old and new societies, the white paper exposes the extreme darkness, cruelty and backwardness of the old Tibetan feudal serfdom; reveals the historical inevitability and great significance of the democratic reform in Tibet; and demonstrates the magnificent achievements in Tibet where productive forces have been unleashed and the people have become the masters of their own affairs. It reflects the historical progress of Tibet's political, economic and social development, ecological conservation, freedom of religious belief, and the equality and solidarity among all ethnic groups over the past 60 years.

With irrefutable facts, the white paper once again proves that the past 60 years of democratic reform in Tibet have witnessed the great victory of the Party's ethnic policy; the successful practice of the regional ethnic autonomy in China; and that the Tibetan people feel grateful to the Party and follow the Party.

The publication of the white paper fully reflects that the CPC Central Committee with Comrade Xi Jinping at its core places enormous importance on Tibet and all ethnic groups in the region. It fully reflects the common aspirations of the people of all ethnic groups in Tibet to cherish the Chinese dream and strive for a new era.

Here, on behalf of the CPC Tibet Autonomous Regional Committee, the People's Government of the Tibet Autonomous Region, and the more than 3 million people of all ethnic groups in the region, I would like to express our firm and loyal support to the central government's decisions.

As we all know, serfs and slaves, who made up 95 percent of the total population in old Tibet, were completely deprived of their personal freedom and political rights. With the abolition of feudal serfdom during the democratic reform, the Tibetan people, like the Chinese people of other ethnic groups, became masters of their own country and society, gained the right to participate equally in managing state affairs, took control of managing social affairs in Tibet and their own destiny, and are able to create and enjoy the material and cultural wealth in Tibetan society. People of all ethnic groups in Tibet and other Chinese people live in harmony, and are working to create a wonderful new life together. In the span of a few decades, Tibet went through the democratic reform, the founding of the Tibet Autonomous Region, reform and opening up and other important stages of development. Under the strong leadership of the CPC, Tibet has achieved historic leaps in economic and social development, following the path of socialism with Chinese characteristics. Since the 18th CPC National Congress in particular, government officials and the general public of all ethnic groups have rallied closely around the CPC Central Committee with Comrade Xi Jinping at its core, and held high the banner of socialism with Chinese characteristics. They have earnestly studied and fully implemented Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and the guiding principles from the 18th and 19th CPC national congresses, as well as the Sixth Central Conference on Tibet, and put into practice General Secretary Xi Jinping's major expositions on governing border areas and stabilizing Tibet, as well as his guiding principles on the work in Tibet. They strive with gratitude and help each other on the way, breaking new ground featuring significant development and long-term stability. At present, Tibet sees the CPC leadership strengthened in all respects, with accelerated economic and social development, greatly improved livelihoods of the people and substantially enhanced capacity in public services. Tibet also boasts a good ecological environment, a stable society, united ethnic groups, harmonious religions and consolidated border areas. People of all ethnic groups show increasing support to the CPC and love to the great motherland, and increasingly cherish their hard-won happy lives, ethnic unity and social harmony. The longing for stability there is stronger than ever before.

The brilliant achievements of democratic reform in Tibet in the past 60 years, especially the historic achievements and changes made since the 18th CPC National Congress, fully demonstrate the unrivaled superiority of the socialist system, the unrivaled warmth of the great motherland and the unrivaled correctness of the CPC's strategy for governing Tibet. Feudal serfdom in Tibet already passed into history, and a new Tibet has been unveiled to the world, with its people now working together with the Chinese people of other ethnic groups to build a moderately prosperous society in all respects and to enjoy a modern life for all people. All these achievements are the result of the strong leadership and kind care of the CPC Central Committee, the strong support of the government departments, ministries and commissions, as well as support from provinces and municipalities, central enterprises and people across the country, plus the joint efforts of CPC organizations at all levels, CPC members, and people of all ethnic groups in Tibet.

We firmly believe that as long as we adhere unswervingly to the leadership of the CPC, follow the path of socialism with Chinese characteristics, uphold the system of regional ethnic autonomy, and implement the CPC's strategy for governing Tibet and General Secretary Xi Jinping's major expositions on governing border areas and stabilizing Tibet, the future of Tibet will be even brighter. Now, the floor is open to questions.

Hu Kaihong:

Thank you, Mr. Norbu Dondrup. Now, the floor is open to questions. Please identify your media organizations before asking questions.

Hong Kong Ta Kung Wen Wei Media Group:

We know that the human rights situation in Tibet Autonomous Region has seen tremendous change since the beginning of democratic reforms 60 years ago. However, some countries and the Dalai group claim that the human rights situation in Tibet is not so good. What is the human rights situation in Tibet like? Are there any violations of human rights in Tibet? Thank you.

Norbu Dondrup:

There is an old Chinese saying: "a resonant drum needs no heavy beating, and a running horse needs no spur." Many people here today are from Tibet and most of them are local officials of ethnic minority groups whose parents suffered from ruthless oppression and exploitation under feudal serfdom. Today, we come to the press conference with a brand-new attitude. The people next to me are both officials of ethnic groups, and so am I. You can see from us the remarkable achievements that the cause of human rights has made. There are abundant historical materials in the white paper released today which provide detailed information on democratic reforms in Tibet and its landmark achievements under the leadership of the Communist Party of China. Therefore, regarding the human rights situation in Tibet, I can tell you that it is not just good, but it's very good. The public's sense of happiness over the development of the cause of human rights and protection of human rights in Tibet is not just strong, but very strong. Some people abroad and the Dalai group cast blame on our human rights, but I believe they have ulterior motives. What I have mentioned about the tremendous changes in political, social and economic aspects in Tibet are exactly the achievements and changes we have made on the cause of human rights development. 

We know very well that before 1959, the millions of serfs in Tibet had almost no words or concepts of "human rights" in their minds. They did not realize the concept of human rights because, in the old Tibet ruled by Dalai, they were entirely deprived under the feudal serfdom. Their basic right to life was absent, let alone their right of development. The last generation of our people to have witnessed this said that it was an extremely dark and cruel society, where millions of the serfs were merely "talking tools." The feudal serfdom regime in Tibet divided people into three distinct social classes and nine ranks. People of the highest rank were literally worth their weight in gold, while people of the lowest rank were worth only the price of a straw rope. There was no equality before the law. Serfs could be sold, transferred and even slaughtered or put into jail. Serfs could be randomly selected to have their skin pulled, their tendons pulled out or even their eyes gouged out. All of this has been mentioned in the white paper. How could people have human rights under those circumstances? There were no human rights at all. Therefore, when the Dalai Lama attacks our human rights today he definitely has motives behind it. His abuse of human rights disqualifies him from talking about the human rights.

Some countries, coaxed or misguided by slanders from the Dalai Lama clique, attack our human rights conditions. Human rights in China are closely integrated with our own national conditions; have answered and satisfied the people's demands; and have been catered for the broad masses of the population and the people of Tibet. In evaluating human rights conditions, one should listen to the people, especially the more-than-3-million Tibetan people, who should have the final say. In my view, the satisfaction and happiness of the people are the best testimony for human rights conditions.

In turn, we now feel that we have been liberated and have been empowered to become masters of the country and society, and have the right to pursue our own destiny. We are therefore proud of it. We are very happy to live in the socialist family under the leadership of the Communist Party of China. Just as what I have mentioned to you, we are not only the offspring of the serfs, but also the living witnesses to six decades of brilliant development of Tibet's politics and economy. We are the real beneficiaries of the achievements of all aspects of social development and human rights in Tibet.

Broadly speaking, human rights can be prioritized in two basic rights—the right to life and the right to development. Compared with old Tibet, Tibet's human rights are an epoch-making leap. Since the democratic reform, under the cordial care of the Party Central Committee, Tibet's human rights and all aspects of Tibet's development have indeed achieved unprecedented and tremendous historical achievements.

First, the Tibetans enjoy the equality of political rights and are able to participate in the administration of regional and state affairs. In the national and local people's congresses and the annual Two Sessions (the National People's Congress and the Chinese People's Political Consultative Conference), the deputies are composed by a majority of Tibetans and other minorities from the Tibet Autonomous Region. They are always greatly pleased and highly honored to attend the sessions. In their strikingly embroidered traditional clothes, they speak on behalf of their people. They fulfil the duties entrusted to them by their people and extend the wishes of Tibetans and other minority people as much as they can. 

The Chairman of the Tibet regional government and the Director of the local People's Congress are cadres of ethnic minorities, mainly local Tibetan cadres. Most Party secretaries and county heads of Tibetan cities and counties are also ethnic minority cadres. People here enjoy equal political participation, and representatives are chosen regardless of their ethnic nationality and social status. The right to live is also clearly protected and the Constitution and laws guarantee the lives and property of the general public in Tibet. People can participate in economic and social activities as long as they fall within the law and are free to love, marry, and hold weddings and funerals. The Party and the government have also taken many measures to improve medical conditions, extend the life expectancy of the people of Tibet and improve the health of the people. We have invested a large amount of funds and started many projects in this aspect. There are many endemic diseases in Tibet, such as high-altitude cardiovascular disease and rheumatism, and there are children with congenital heart disease. The Party and the government attach much importance to this and have made great efforts to build a large number of medical institutions at the autonomous region, prefecture and county levels. We now have big hospitals at the autonomous region level, Class A hospitals in the counties, health centers in the towns, and health clinics in the villages — all staffed with many medical professionals. They have worked hard to serve the people and patiently prevent and treat diseases for the general public. Therefore, many people are now freed from the pain of disease and live a happy and healthy life.

Every time there is a big natural disaster, our government is quite concerned about the people in Tibet, and tries the best to help the people there. Saving lives is always the top priority. All ethnic groups in China are united and dependent on each other, and we are as inseparable as fish is to water. Whether you are of Tibetan or Han ethnic group, we are inseparable from each other. Ethnic minorities are also inseparable from each other and when encountering natural disasters, everyone rushes to the front line to help in disaster relief efforts. In the face of disasters, they demonstrate that "when one has difficulties, all others would support" and rescue victims of disasters such as earthquakes and mudslides in a timely manner.

As specified in the white paper, we also enjoy sufficient rights to carry out further development. But what I want to tell you is that there was no decent road in the old Tibet. All materials required for production as well as daily necessities were transported over thousands of miles by people who carried them on their backs, and by mules, horses, cattle and even sheep. The movement of such materials to Tibet relied solely on these forms of transportation. But now our infrastructure, including transportation, water, electricity, communications, etc., extends in all directions. Modern roads in Tibet now stretch over 90,000 kilometers. In the past, millions of Tibetan serfs had never left their villages, never seen a plane or even heard of a car, but now almost every family has their own vehicles, and is free to travel everywhere. Those who had never seen an airplane, now not only can board a plane and go to various places in China, but also have the option to become a pilot themselves. In the past, people lit up their homes with oil lamps, but now homes can be brightly lit by electric lamps with just a flick of a switch. The roads and highways are also all illuminated by lights. It is clear that human rights have developed and progressed in Tibet.

In terms of education, I would like to talk about my own experience. When I first left home, I did not know much about the outside world. We were not educated back then. However, now I am not only fluent in the Tibetan language, but also the Chinese language. I can communicate conveniently with people from the rest of China and other parts of the world.

Besides, in the old Tibet, only 5 percent of the people, mostly feudal serf owners, were entitled to education; and the rest of the people, about a million serfs, did not have the right to education. Now, we are all entitled to education, and the state has founded many schools in Tibet.

As far as I know, there are over 2,200 schools of various kinds in Tibet, and all school-age children can go to school. They enjoy education in a good environment, and can learn a lot of knowledge. They learn the Tibetan language, the Chinese language, and even the languages of many other countries. This is a huge historic breakthrough of human rights in the field of education. The serfs could not even dream about this before, as it would have been totally unimaginable.

In terms of culture, our Party and state pay great attention to the cultural development of Tibet. Many cultural and historical sites in Tibet have been well protected and developed. As many temples are made of wood and mud, the state has spent huge amounts of money to renovate and protect them from weathering and natural disasters. There are 55 national cultural relics protection units and 616 regional cultural relics units in Tibet. Some important historical sites, including the Potala Palace in Lhasa, have entered the UNESCO's world cultural heritage list, and have enjoyed appropriate protection. 

In terms of freedom of religious belief, there is a saying that "seeing is believing." You can go all around Tibet and see that people are free to practice their religious beliefs. The law protects every person's right to freedom of religious belief, and there are no restrictions on religious beliefs. In addition, the state constantly renovates religious buildings, and connects them with running water, electricity and roads, which was unimaginable in the past. Many of the temples in Tibet are built on high mountains, but are now easily accessible by car now. The monks' lives have become more convenient, and they can feel that the Party and the government sincerely care and pay great attention to them.

Tibet has always prioritized ecological protection, and many measures have been taken and many laws and rules issued. We have implemented the concept that fresh water and lush mountains are invaluable assets. The ecological environment in Tibet has been fully protected.

In short, people of all ethnic groups in Tibet can not only take part in the management of state and local affairs on an equal footing, but can also enjoy a peaceful and happy life in which babies can be nurtured, children can be educated, workers can be duly paid, patients can be treated in time and the elderly can be supported appropriately.

People can receive payment for all their work. All people have places to live in and all needy hands can be helped. People of different ethnic groups in Tibet love the CPC and their motherland. They feel content with their happy lives in the big family of the motherland, under the leadership of the Party. And they tend to use all kinds of ways to show their appreciation to the Party. 

For example, every year during the National Day, local people hang the national flag at home to show their devotion to the motherland. In the Spring Festival and Tibetan New Year, they devote the first cup of highland barley wine, the first piece of hada and their first song to the Party, the motherland, the leaders and relatives in other parts of the country. This speaks volumes about the historical achievements of human rights conditions in Tibet, as well as local people's satisfaction with the development and conditions of human rights in Tibet.

CCTV:

My question is about Tibet's poverty alleviation. We know that the Tibet is the only contiguous poor area at the provincial level and a poverty-stricken region of China. So how is the poverty alleviation work going in Tibet? Thanks.

Norbu Dondrup:

As we have said, the old Tibet was a society of feudal serfdom, lacking good geographical conditions and a natural environment for development. For a long time, the Dalai group has engaged in a series of sabotage activities in Tibet. Therefore, Tibet is a poverty-stricken area at large. Through poverty alleviation work, great changes have taken place in Tibet. But compared to other areas of China, we still lag behind. We have more areas with severity poverty. And the cost and efforts for poverty alleviation are huge. At the end of 2015, 590,000 people were registered as households living under the poverty line, with a poverty headcount ratio of 35 percent.

General Secretary Xi has given an eminent place to the poverty alleviation work in Tibet. To lift the people in Tibet out of poverty has always a major concern of his. During the conferences on poverty alleviation held in Fuping, Yan'an, Guiyang, Yinchuan, Taiyuan and Chengdu, General Secretary Xi has put the poverty alleviation work first and pointed out that building a moderately prosperous society in all respects means leaving no ethnic minority group behind.

Therefore, the Party committees and governments at various levels stand firm and take targeted measures to lead the masses combating poverty with a straight forward spirit. Many preferential policies, particularly for the development of Tibet, have been carried out, which do not only greatly push forward the alleviation work but offer another opportunity of historical significance. Tibetans living in poverty appreciate everything General Secretary Xi and the government is doing to lift them out of poverty. They have said that General Secretary Xi is busy with various national affairs, and yet he still cares about the people in the most remote areas. They appreciate General Secretary Xi and the CPC Central Committee with all their heartfelt intention.

The CPC Tibet Autonomous Regional Committee and the regional government have unswervingly implemented the strategy of precision poverty-reduction and poverty-eradication. In accordance with the requirements, we set forth the objective of providing adequate food and clothing while ensuring access to compulsory education, basic medical services and housing. "Providing adequate food and clothing" here means that people in Tibet eat better than before. In the past, people living in the old Tibet don't have enough food and clothes, nor hopes for having more tomorrow. Their lives were miserable.

I came from a rural area. Many officials, including me, have made many visits at the community level in the Tibet Autonomous Region to see the real conditions there, so as to connect more closely with the people, as required by General Secretary Xi. Poverty reduction has achieved great progress in the impoverished areas. People now have access to a variety of food, including beef, butter, drinks and barley wine. In addition, thanks to a series of measures, vegetables can be planted at high altitudes and fresh vegetables are available to the people there. People have new clothes to wear for the New Year, and have more choices. This is what I mean when I said "providing adequate food and clothing."

The medical services and housing are even better. We have a medical insurance system based on free medical services, ensuring the public has access to medical services. If people get sick, they can seek medical services both in villages and townships. The public can receive not only disease prevention services, but also treatment in other regions. The public can even seek medical services in other regions of China by plane. Why can this happen? Because of the government's good policies, which provide the public with something to rely on. Moreover, the improved livelihood of the public allows them to afford greater expenses. All of these are true facts. Regarding the housing safety issue, the residential buildings built in the past were relatively low in quality, however, new buildings are spacious, bright, comfortable and of good quality. You can go to Tibet Autonomous Region to see for yourself. In accordance with the requirements of the central authorities, the CPC Tibet Autonomous Regional Committee and the Tibet Autonomous Regional Government resolutely put poverty alleviation as the top priority and the first livelihood project, and placed it at the top of the "three major battles" (poverty relief, environmental protection and preventing financial risks). The achievements have been fruitful. Party committees and governments at all levels have concentrated more efforts on poverty alleviation, pledging that they will never stop until winning the battle with the belief that if they don't win the battle, it's because they haven't made enough efforts. We work towards poverty alleviation through targeted measures, including: who is the one we need to help? What has caused his poverty? We conduct multiple analysis from various aspects, such as poverty level and cause, before helping. We will continue to make specific plans and measures for poverty alleviation, and provide them with necessary technology, funds and production materials, in a bid to help them get rid of poverty and achieve prosperity as soon as possible. 

We are determined to promote poverty alleviation industry projects based on our strengths. At present, over 2,300 poverty reduction projects have been carried out, lifting 211,000 people out of poverty. You may not understand that it is very difficult to develop the industry in Tibet, especially in places where there are snow and ice, very high altitudes and harsh conditions. However, our Party and government have taken special measures to overcome various difficulties to promote industries in impoverished regions. A large number of crop production, breeding and processing cooperative organizations have been established and they have proved to be very helpful. Moreover, many enterprises participate in the poverty alleviation battle. They have set up their own poverty alleviation contact offices, and developed an array of industries to promote poverty reduction. Due to some severe lack of resources, the high cost for providing access to water, electricity and roads, or extremely poor natural environments, it was really difficult to assist some impoverished people in places they used to live, so we encouraged them to relocate to places with convenient transportation conditions, surplus resources, and a higher level of urbanization so that they can get rid of poverty in a new environment. During this process, we fully respected their willingness, and helped them relocate step by step. We never forced them to relocate. We encouraged people who live in highly and extremely cold pasturing areas, deep mountains and valleys, places with endemic diseases, places with frequent geological disasters and ecologically vulnerable places to move out so that they will have the chance to get rid of poverty and achieve prosperity. Those impoverished people who relocated have moved into very good residences which they could not have imagined before. The relocation sites are all equipped with public services facilities, such as hospitals and schools. Some 266,000 people have showed their willingness to relocate, and 236,000 of them have finished their relocation. We address poverty reduction by carrying out training and teaching skills in a bid to help impoverished population increase confidence in their own ability to lift themselves out of the poverty and see that they can access the education they need. We would hereby like to express our gratitude to the people in other regions of China. The central government has spent a large amount of money and investment to fight against poverty in Tibet. A lot of provinces and cities have provided their assistance to the region, bringing advanced technology, modes of production and management ideas. They have provided training and tought skills for local people who were hindered by traditional thoughts and not market-minded. This has obviously enhanced local people's ability to lift themselves out of poverty. They are on the one hand the objects of the poverty reduction, but on the other hand, they have become the major driver in the battle. Consequently, the public say they have learnt a lot in the poverty eradication process. Remarkable changes have taken place. They say their income in the past was too low, but now, it has increased significantly. Moreover, they can do more things after mastering skills. 

The central government has formulated many policies for us, and we Tibetans have benefited greatly. The autonomous region has pooled funds of more than 40 billion yuan to implement these policies. The central government agencies and the provinces, cities and enterprises which provide aid to Tibet, have invested nearly 50 billion yuan to promote its economic and social development, as well as intensifying poverty alleviation inside Tibet. Meanwhile, with the pair-assistance, Tibetans not only learned about the technology, but also directly gained benefits in fighting against poverty. We persisted in enhancing Party building and promoting poverty eradication. Many officials are stationed to help villagers escape poverty, standing with them throughout the process. Poverty alleviation has had some initial achievements. Since 2016, 55 poverty-stricken counties have been removed from the list of impoverished counties, 4,714 poor villages have been withdrawn from the poverty system, and 478,000 people have been lifted out of poverty. The poverty incidence has dropped from 35.2 percent before 2015 to below 6 percent now. We regard it as a miracle. The general secretary's effective strategy of precision poverty alleviation shows the greatness of our Party and the superiority of the socialist system. Now we still have 19 counties, 662 poor villages and 150,000 people that need to shake off the mantle of poverty. These places experience the most extreme poverty because they live with difficult conditions in the most remote areas at the highest altitude. Poverty alleviation in these places will be very difficult. However, with the warm care of the Party Central Committee, the wise guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the unparalleled superiority of the socialist system and the firm determination of the communists, the selfless assistance of our people throughout the country, and the joint participation of people of all ethnic groups in Tibet, we will surely achieve the goal of getting rid of poverty according to schedule, and we will build a moderately prosperous society in all respects along with the whole country. We have confidence and determination in the poverty eradication of the last 19 impoverished counties and we also have sufficient preparation. Thank you all.

Reuters: 

Why not allow the people in Tibet to decide their own future and conduct an independence referendum?

Norbu Dondrup:

The situation in Tibet has already been fully detailed in the white paper. Tibet has been an inalienable part of China since ancient times, and all ethnic groups in Tibet are members of the Chinese nation. What you mentioned just now, to speak bluntly, was created by the imperialists. We have never recognized the independence of Tibet and no country in the world has ever recognized Tibet as an independent state. Moreover, Tibet now lives happily within the big family of China. I have already spoken at length earlier that we have now become the masters of the country, society and our own destiny. The Government of the People's Republic of China has been recognized as the sole legal government representing the entire Chinese people. The so-called "Tibetan Independence" does not exist. Established by the Dalai clique outside China, the so-called "government in exile" is invalid, illegal and has not been recognized by any country in the world. Under the leadership of the Communist Party of China, we enjoy the warmth of the big family of our socialist motherland and have complete control over our own destiny. Thank you. 

China News Agency:

Traditional Tibetan culture has long been attracting attention from home and abroad, and education is also related to the future development of Tibet. Please give introductions in these two aspects. Thank you.

Norbu Dondrup:

Mr. Dawa, deputy director general of the United Front Work Department of CPC Tibet Autonomous Regional Committee, will give you an introduction on the education in the autonomous region.

Dawa:

Let me introduce the cultural aspect first. The central government always attaches great importance to the protection, inheritance and development of traditional Tibetan culture. The CPC Committee and government of Tibet Autonomous Region always places the protection and development of traditional Tibetan culture as an important part of economic and social development, and supports it with policies, projects, capital, technologies, talents and so on. The autonomous region collected, edited and published seven literature and art compendiums such as, "Compendium of Chinese dramas: Tibetan volume" and "Compendium of Chinese Ethnic and Folk Dance: Tibetan volume". Meanwhile, historical buildings like the Potala Palace have been included in the UNESCO World Heritage List; while the Tibetan opera, the Epic of King Gesar and the Lum Medicinal Bathing of Sowa Rigpa (the Tibetan Medicine) have been included on the Representative List of the Intangible Cultural Heritage of Humanity. There are also 89 national-level representative projects, 96 national-level representative inheritors, 460 autonomous region-level representative projects and 350 autonomous region-level representative inheritors in the autonomous region. Four organizations including the Potala Palace have been included on the list of National Key Organizations for Protecting Ancient Documents and Anthologies, and 291 ancient books have been included on the list of National Precious Ancient Books.

At the same time, the Central People's Government and the People's Government of the Tibet Autonomous Region have always protected the inheritance and development of minority languages. The regional government, according to relevant stipulations of the Constitution of the People's Republic of China and the Law on Regional Ethnic Autonomy, formulated rules on learning, using and developing Tibetan language; developed the Tibetan language teaching and textbook system from elementary school to high school; and has vigorously supported the production of Tibetan language newspapers, magazines, books, radio and television programs. These have effectively promoted the widespread use of the language. The Tibetan language has become the first Chinese minority language with international standards. Now, the Tibet Autonomous Region publishes over 100 kinds of books in Tibetan language every year. All these efforts make sure the Tibetan language continue to be used in radio broadcasts, television programs, online pages, newspapers and magazines, textbooks and other published books.

As for education, as the previous speakers have mentioned, the vast majority receiving education in old Tibet were children of aristocrats. Serfs, who made up 95 percent of the total population, had no right to education, and the illiteracy rate of young adults was around 95 percent. Since democratic reform, Qamdo Primary School, Lhasa Primary School, Lhasa Middle School and many other schools have expanded rapidly. Middle schools and primary schools were established in various prefectures and counties, with primary schools set up in most townships and some villages. In 1961, Lhasa Normal School, the first school for teachers in Tibet, officially opened, and since then, Tibet University, Tibet Agriculture and Animal Husbandry University, Tibetan Traditional Medicine College and Tibet Vocational Technical College have also been established. A relatively complete modern education system covering pre-school education, basic education, vocational education, higher education, adult education, and special education has been formed in Tibet, and the right to education for all ethnic groups is fully guaranteed.

By 2017, a total of 1,239 kindergartens, 806 primary schools, 132 junior and high schools and seven universities and colleges had been built in Tibet. The number of graduates from all kinds of schools increased from 18,000 in 1959 to over 530,000 in 2017. Other places in China also yielded a fruitful outcome in educating students from Tibet. Now, classes and schools for Tibetan students have opened in 21 provinces and municipalities, which have cultivated over 36,000 graduates with a diploma of technical secondary school or above. In 1985, the country began to cover all food and boarding fees, as well as basic expenses for study, for children of farmers and herdsmen and those from urban families with financial difficulties, and raised the standard 18 times in later years. Since 2012, Tibet has fully implemented the 15-year compulsory education policy and the level of protection has continuously improved. In 2018, the net enrollment rate of primary schools reached 99.5 percent; the gross enrollment rate of middle schools reached 99.5 percent; high schools reached 82.3 percent; and universities and colleges reached 39.2 percent. Each person in Tibet received 9.55 years of education on average. Thank you.

China Daily:

The vice chairman just mentioned there are great changes in the medical industry in Tibet. Can you please give a detailed description of the changes? Thank you.

Ren Jingdong:

As we all know, there were only small-scale government-run medical institutions in the old Tibet, employing less than 100 people. What is worth noting also is that the limited medical resources then were restricted to aristocrats, higher-ranking officials and lamas. A large number of working-class people were unable to get treatment when they contracted diseases. Over the past 60 years, the backward medical services in Tibet have witnessed a fundamental change and have virtually improved and developed in sync with the rest of the country. With steady improvements in medical services, maternal and child health care, Tibetan clinics and medicine, and disease prevention and control, infectious diseases which had severely threatened the public health in the autonomous region had been basically under control by the end of 1970s. The mortality rate and incidence of infectious and endemic diseases had also been substantially reduced. In addition, a number of hospitals have since been renovated and upgraded, including hospitals at the autonomous region level, the prefectural level and 71 medical institutions at the county level. A four-tier medical service system (referring to the autonomous region, cities including prefectures, counties and townships) covering urban and rural areas has been established. Here, I want to stress that, under the special care of the CPC Central Committee, delegations of medical professionals have been dispatched to Tibet in recent years, which include medical staff from 17 provincial and municipal regions involved in a group support program to aid Tibet. Some of them are from renowned hospitals, such as the Peking Union Medical College Hospital, Peking University People's Hospital and Peking University Hospital. Those professionals have strongly promoted the development of the medical industry in Tibet. 

There is a substantial amount of facts and data in the White Paper. This series of facts fully shows that the right to health of all ethnic groups in Tibet has been effectively guaranteed. Thank you.

Economic Daily:

During the past few years, we have observed, that transportation in Tibet has undergone a big transformation. Would you please tell us whether the constructions of infrastructure in such large scales, like, the new railways and new roads, will affect the ecological environment in Tibet?

Luo Jie:

Thanks for your concern regarding the ecological environment in Tibet. As was mentioned by Mr. Norbu Dondrup, Tibet did not have a single decent road until the liberation. The modern roads, including, the Qinghai-Tibet Highway, the Sichuan-Tibet Highway and many other roads that connect Tibet to the surrounding areas were paved at one of the most difficult times in the country. However, since the democratic reform, the transport network, including, Xinjiang-Tibet Highway, Yunnan-Tibet Highway, China-Nepal Highway, has taken shape quickly. At the same time, the Sichuan-Tibet Highway and Qinghai-Tibet Highway were renovated with asphalts. Additionally, a highway connecting Lhasa, capital of Tibet, and Gongga Airport, was also completed. Moreover, in recent years, Tibet's transport system, consisting of highroads, railways and airlines has developed well. The mileage of its highways open to traffic reached 97,800 kilometers. The Qinghai-Tibet Railway and Lhasa-Shigatse Railway have been completed, while the Lhasa-Nyingchi Railway is currently laying rail tracks. There are 92 air routes in Tibet's five airports from both home and abroad.

However, neither infrastructure constructions nor resource exploration will shake Tibet's determination to prioritize environmental protection as its top concern. The major constructions should all abide by the eco-friendly evaluation system, and the counter-pollution facilities should be designed, built and put into use at the same time with the main projects. The Qinghai-Tibet Railway, a project best known for its eco-friendly endeavor, can be one such model.

The Tibet Plateau is located in the core area of the third pole of the Earth. Protecting the ecological environment of the Tibetan Plateau has important strategic significance for safeguarding the global ecological balance. Over the years, the central government and the local government of Tibet have always regarded the protection of the plateau ecological environment as a top priority. In this regard, we have also taken many specific measures:

First, we have increased our efforts to protect the local ecological environment. Tibet has formulated the "Measures of Tibet Autonomous Region's Implementation of Regulations of the People's Republic of China on Nature Reserves" and the "Measures on Supervision and Management of Ecological Environmental Protection in Tibet Autonomous Region." We have issued a number of guidelines concerning ecological conservation, such as, "Opinions on Building a Beautiful Tibet" and "Opinions on Building an Important National Shield for Ecological Security and Accelerating Ecological Progress." Those legitimate the conservation of natural reserves and wetlands, the protection of wild animals, the prevention and control of desertification and the return of farmland to forests and grassland.

Second, the total area of the ecological protection zones continues to expand. Since the establishment of Mount Qomolangma National Nature Reserve in 1988, Tibet has established 47 nature reserves with a total area of 412,200 square kilometers, accounting for 34.35 percent of the region's territorial area. In addition, 22 ecological function protection zones have been built, including one national-level zone. 36 counties have been included in the national key ecological function protection zones; and four national-level scenic spots, nine national forest parks, 22 national wetland parks and three national-level geological parks have been established. China continues to increase investment and implement ecological compensation policies for the costs of ecological environmental protection. Since 2001, the accumulated compensation funds have reached 31.6 billion yuan for forests, grasslands, wetlands and key ecological functional zones.

Third, is the continued restoration of biodiversity. Tibet has successively implemented the ecological security shield protection construction project and the afforestation project in the basins of the Yarlung Tsangpo, Nujiang, Lhasa, Nyangchu, Yalong, and Shiquan rivers. The effect of the ecological protection initiatives has been remarkable. At present, the forest covers 12.14 percent of the whole region, and the forest area is 16.02 million hectares, including forest land, shrub land and other woodland. The comprehensive vegetation coverage of natural grassland in the region reached 45.9 percent, the natural grassland area reached 88.93 million hectares, and the wetland area reached 6.53 million hectares. Tibet has 141 kinds of nationally and autonomous region-protected wild animals, 38 kinds of nationally protected plants, and 22 unique bird species. The important ecosystems in Tibet have thus been effectively protected.

At present, the structure of the various ecosystems in the Tibetan Plateau is stable, the ecological quality is stable and positive, and the quality of water, gas, sound, soil, radiation and the ecological environment are also in good condition. The water quality of major rivers and lakes such as the Yarlung Zangbo River and the Nujiang River is maintained as either Class I or Class II, and the quality of drinking water sources is good. The source areas of big rivers, grasslands, lakes, wetlands, natural forests, water ecology, geological relics and biodiversity are effectively protected. Most of the areas are still in their original state. Tibet is still one of the areas in the world with the best environmental quality. Thank you.

Hu Kaihong:

Today's press conference ends here. Thank you.

.

Read in Chinese

Speakers:
Luo Wen, deputy head of the National Development and Reform Commission;

Lin Shaochun, member of the Standing Committee of the CPC Guangdong Provincial Committee and executive vice governor of Guangdong province;

Matthew Cheung Kin-chung, chief secretary for Administration of the Hong Kong Special Administrative Region;

Mi Jian, director of the Policy Research and Regional Development Service of the Macao Special Administrative Region

Chairperson:
Xi Yanchun, spokesperson for the State Council Information Office

Date:
Feb. 28, 2019

Xi Yanchun:

Ladies and gentlemen, good afternoon. Welcome to this press conference. "The Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area," recently released by the Central Committee of the Communist Party of China (CPC) and the State Council, has received a lot of attention. To offer more information about the plan, today we are delighted to welcome four of the involved officials to explain the plan and answer your questions. They are Mr. Luo Wen, deputy head of the National Development and Reform Commission; Mr. Lin Shaochun, member of the Standing Committee of the CPC Guangdong Provincial Committee and executive vice governor of Guangdong province; Mr. Matthew Cheung Kin-chung, chief secretary for Administration of the Hong Kong Special Administrative Region; and Mr. Mi Jian, director of the Policy Research and Regional Development Service of the Macao Special Administrative Region. Now, I'll give the floor to Mr. Luo.

Luo Wen:

Ladies and gentlemen, dear friends, Good afternoon!

Thank you for your attention and support to the development of the Guangdong-Hong Kong-Macao Greater Bay Area. Let me take this opportunity to express my sincere thanks to our friends from various sectors of society for their interest, understanding and support for this initiative.

Promoting the development of the Greater Bay Area is a major national strategy that General Secretary Xi Jinping has planned for, made decisions about and promoted in person. On July 1, 2017, he witnessed the signing of the Framework Agreement on Deepening Guangdong-Hong Kong-Macao Cooperation in the Development of the Bay Area between the National Development and Reform Commission (NDRC), and the governments of Guangdong Province, Hong Kong Special Administrative Region and Macao Special Administrative Region, signaling the development of the Greater Bay Area was officially made a national strategy.

General Secretary Xi Jinping subsequently issued a number of important instructions on the development of the Greater Bay Area, clearly setting out the objective of "developing a vibrant and internationally competitive first-class bay area", showing clearly the direction for our future work. Different from other bay areas in the world, the development of the Greater Bay Area faces many new challenges as it will be carried out under the "one country, two systems", involving three customs areas using three different currencies, which is without precedent internationally. Therefore, it is not only an attempt to break new ground in pursuing opening-up on all fronts in the new era, but a further step in advancement of the practice of "one country, two systems". In formulating the outline development plan for the Greater Bay Area, we have always borne in mind the principle of "one country, two systems" and acted strictly in accordance with the Constitution and the Basic Laws, aiming to support the integration of the development of Hong Kong and Macao into the development of the country as a whole, fully leverage their unique advantages, promote cooperation to achieve win-win outcomes, give new impetus to their development, and provide strong support for the implementation of the innovation-driven development strategy and the building of a new system for an open economy. Based on these considerations, the outline development plan attaches special importance to the following four aspects:

First, taking into full consideration the overall development of the country when defining the strategic positioning of the Greater Bay Area. The [latter] plays an important role in China's reform, opening up, and socialist modernization. We have always kept the overall situation in mind, with a global vision in our study, and put forward five major strategic positions, so as to further enhance the Greater Bay Area's supporting and leading role in China's reform and opening up, and better serve the country's development strategy.

The second involves adhering to the principle of "one country, two systems" to maintain the long-term prosperity and stability of Hong Kong and Macao. The outline development plan stresses the importance of implementing the principle of "one country, two systems" and acting in strict adherence to the Constitution and the Basic Laws, with a focus on promoting coordinated and synergistic development of Guangdong, Hong Kong and Macao, expanding the development space for the latter two, and enriching the practice of "one country, two systems".

The third aspect concerns fully leveraging the comparative advantages of Guangdong, Hong Kong and Macao, and enhancing the region's international competitiveness. The outline development plan underlines the importance of properly leveraging the benefits of the "two systems" to stimulate institutional vitality and the market, and strengthen the core competitiveness of the Greater Bay Area.

The fourth aspect involves deepening reform to give play to the decisive role of market forces in resource allocation. The outline development plan highlights the critical role of innovation, with a focus on removing all institutional and systemic obstacles hindering cooperation and development of the Greater Bay Area. It strives to expedite early and pilot implementation of certain major reform measures in the Greater Bay Area and employ market-oriented, law-based measures to tackle problems in development.

Generally speaking, the main contents of the plan can be summarized as follows: One focus, one vision, seven priorities and four measures. "One focus" refers to supporting the integration of Hong Kong and Macao into the overall national development; "one vision" involves developing a vibrant and internationally competitive first-class bay area and build a role model of high-quality development; the "seven priorities" define the seven major areas for development, including building a globally influential international innovation and technology hub, and expediting infrastructural connectivity; the "four measures" involve strengthening organizational leadership, pressing ahead with the major tasks, preventing and mitigating risks, and broadening social participation.

In fact, we have been working with Guangdong, Hong Kong and Macao, as well as relevant departments to advance development of the Greater Bay Area in an orderly way. For example, the infrastructure connectivity of the Greater Bay Area has been enhanced. The Hong Kong-Zhuhai-Macao Bridge has officially opened to traffic, and the Hong Kong section of the Guangzhou-Shenzhen-Hong Kong Express Rail Link has also started operation. Construction of an international innovation and technology hub is progressing steadily, with the development of the "Guangzhou-Shenzhen-Hong Kong-Macao" innovation and technology corridor. Progress has been achieved in investment facilitation, trade liberalization and facilitation of the flow of people and goods, and the extent of market integration in the Greater Bay Area has been greatly enhanced. Policies and measures facilitating Hong Kong and Macao residents to live and work on the Chinese mainland have been introduced, and the sense of fulfillment and well-being of residents in the Greater Bay Area has been greatly enhanced.

Next, we will act in accordance with the decisions and plans of the CPC Central Committee and the State Council, step up communication and coordination, meticulously organize the implementation, and carry out the follow-up analysis and evaluation, so as to fulfill all tasks set in the outline development plan.

We firmly believe that, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at the core, we will advance the development of the Greater Bay Area step by step and move toward the objective of building it into an international first-class bay area with the joint efforts of various areas, all departments and different sectors of society.

Thank you!

Xi Yanchun:

I'll give the floor to Mr. Lin Shaochun.

Lin Shaochun:

Ladies, gentlemen and friends of the media, hello everyone! I'm glad to meet with you here. Thanks for everyone's attention and support for the efforts made by Guangdong province to advance the construction of the Guangdong-Hong Kong-Macao Greater Bay Area. Now, I will give a brief introduction of the latest progress of the initiative.

A mechanism of coordination has been established. A steering group of Guangdong province to promote Greater Bay Area construction was established, with provincial Party secretary Li Xi and the provincial governor, Ma Xingrui, assuming the roles of director and executive deputy director. In addition, six special task forces were assembled to coordinate work in key areas. The province also formulated a series of matching policies implementing the Outline Development Plan for the Guangdong-HongKong-Macao Greater Bay Area with systematic approaches.

Scientific and technological innovation and cooperation have been deepening in the Greater Bay Area. Phased work on the Shenzhen-Hong Kong Technology Innovation Cooperation Zone has been progressing smoothly. The Hong Kong University of Science and Technology has set up a branch campus in Nansha district of Guangzhou city. In Shenzhen a total of 6 higher education institutions from Hong Kong have set up 72 scientific research facilities. A total of 151 programs were jointly built by Guangdong and Hong Kong to offer financial aid to promote innovation. Policies were issued to offer guidelines for the overseas use of Guangdong provincial financial funds for scientific research.

Significant growth has been seen in infrastructure construction and interconnectivity. The Hong Kong-Zhuhai-Macao Bridge opened to traffic last October. The Guangzhou-Shenzhen-Hong Kong Express Rail Link has been put into use and offers a co-location arrangement at West Kowloon Station. The Shenzhen-Zhongshan Link is under construction. And the entry port of Hengqin in Zhuhai started to provide 24-hour customs clearance services.

The local business environment has been shifting to meet growing needs. Guangdong province opened 153 service industry sectors to Hong Kong and Macao compatriots, accounting for 95.6 percent of the 160 categories classified by the World Trade Organization. The procedures for opening a business now take no more than 5 working days.

Interconnectivity in the finance sector is steadily advancing. China UnionPay's Quick Pass application mode has reached Hong Kong and Macao. WeChat Pay Hong Kong started to provide local users with mobile payment services in the Chinese mainland. And for the first time, Guangdong and Macao jointly set up a 20 billion-yuan (first phase) fund for cooperation and development.

Residents of Hong Kong and Macao now enjoy increasing convenience when working and living in Guangdong through 53 measures issued to facilitate the construction of the Greater Bay Area. Fifty higher education institutions in the province have been enabled to enroll students from Hong Kong and Macao. The number of medical facilities with Hong Kong and Macao investment has now reached 48. The number of accepted applications for residence permits for Hong Kong and Macao residents has reached 90,000.

In the future, Guangdong will deepen its understanding of General Secretary Xi Jinping's expositions on the construction of the Greater Bay Area, position the project as the main driving force of reform and opening-up in the province, and fulfill the important duty of the construction of the Greater Bay Area. Guangdong expects to make its due contribution to integrate the development of Hong Kong and Macao into the overall development of the country and to facilitate the quality economic growth of the country.

Thank you all!

Xi Yanchun:

Now, let's invite Mr. Matthew Cheung Kin-chung to give us an introduction.

Matthew Cheung Kin-chung:

Ladies and gentlemen, friends,

The development of the Guangdong-Hong Kong-Macao Greater Bay Area (Greater Bay Area) is a national strategy that was planned, arranged and promoted by President Xi Jinping in person. It is not only an attempt to break ground by pursuing opening up on all fronts in the new era, but also a further step in pushing forward the practice of "one country, two systems." By further deepening cooperation, it aims to promote coordinated economic development in the region, to make use of the complementary advantages of the three places, and to further enhance the Greater Bay Area's supporting and leading role in the nation's economic development and opening up policy.

"One country, two systems" is the advantage of Hong Kong in the Greater Bay Area, and serves as an important foundation for the Greater Bay Area to go global. Chinese leaders commonly reiterate the principle of "one country, two systems," under which the people of Hong Kong govern themselves with a high degree of autonomy. Promoting the development of the Greater Bay Area enriches the practice of "one country, two systems," which is conducive to maintaining Hong Kong's long-term prosperity and stability. It will not blur the boundary of the "two systems" like some people fear, nor will it affect Hong Kong's status as a separate customs territory.

Under the "one country, two systems" policy, Hong Kong enjoys unique dual advantages. Even as part of the country, it has its own economic, legal and social systems. It is a highly open and international city with an inviting and convenient business environment and excellent professional services. We can join these advantages of Hong Kong to the vast market, complete industrial system, strong technological presence and other advantages of the nine mainland cities in the Greater Bay Area. By promoting the coordinated development of the Greater Bay Area, Hong Kong will further enhance its status as an international financial, shipping and trade center, as well as an international aviation hub.

Hong Kong will be an active participant, facilitator and promoter. It can share its rich experience in international connections with the mainland and help introduce foreign investors. It can also work with mainland enterprises to jointly explore overseas markets and seek out development opportunities, and consequently, to promote the economic growth of both sides and achieve mutually beneficial results.

Xi Yanchun:

Thank you, Mr. Zhang. Now, Mr. Mi Jian, please.

Mi Jian:

Good afternoon. I'm going to talk about our understandings of the outline development plan from the perspective of the Macao SAR.

Firstly, the outline development plan bestows Macao with a new historic mission and new responsibilities. We find there are 49 items in the outline development plan concerning the Macao SAR, highlighting the importance of Macao during the development and construction of the Guangdong-Hong Kong-Macao Greater Bay Area. Let me summarize this aspect under four headings.

First, it lists Macao as one of the four principal cities involved in the development and construction of the Guangdong-Hong Kong-Macao Greater Bay Area, making it a "core engine" for regional development. For a small area like Macao to undertake such a significant role shows the central government's trust in us and its sense of anticipation.

Second, the 12th and 13th Five-Year plans clarified Macao's roles as a global tourism and leisure center, as well as an economic and trade cooperation platform between China and Lusophone countries. This has been stressed again in the outline development plan.

Third, it calls on Macao to develop into a base for exchange and cooperation where Chinese culture is the mainstream but co-existing with diverse cultures. This reflects a high appreciation of the historical position and distinctive culture of Macao, as well as the successful co-existence of diversified cultures.

Fourth, one of the key goals of the outline development plan is to pursue the development of the "Guangzhou-Shenzhen-Hong Kong-Macao" innovation and technology corridor, where Macao becomes one of the supporting points. These four aspects summarize the positioning and the mission given to Macao, reflecting its responsibility as well as the challenges it faces.

In addition, the release and implementation of the outline development plan will bring a once-in-a-thousand-year chance for Macao's development. If Macao can seize this opportunity, proactively participate in the development and construction of the greater bay area, it will surely achieve "leapfrog development" of itself, and diversified economic and social development in this process. This would create conditions and lay a solid foundation for the prosperity and stability of Macao as well as ensuring better lives for future generations. That's a social and historical responsibility the Macao SAR government must undertake. Thank you.

Xi Yanchun:

Thank you, Mr. Mi. Now, the floor is open to questions. Please identify your media organizations before asking questions.

CCTV:

Under the practice of "one country, two systems," Hong Kong and Macao have different social and legal systems than Guangdong. They are separate customs territories. So, the Greater Bay Area faces various challenges in its development. What measures will be taken to promote the development of the area given the policy of "one country, two systems?" Thank you.

Luo Wen:

Thank you for your question. The biggest difference between the Greater Bay Area and other international first-class bay areas is that under the practice of "one country, two systems," it is recognized that Guangdong, Hong Kong and Macao are three separate customs territories with three different currencies and legal systems. This means there are both advantages and challenges in its development. Hong Kong and Macao are developed market economies and free trade ports. Their economic performance, social governance, rules and standards, and government administration are more in line with international practice. Guangdong is the largest provincial economy on the Chinese mainland and also a forerunner of reform and opening up. Hong Kong, Macao and Guangdong, forming the bay area, however, do share the same cultural roots. Their people also have close ties and similar customs. Each of them has their own advantages in terms of economic development. Synergy is bound to be achieved as long as they can foster close cooperation. Meanwhile, the Greater Bay Area is also confronted with challenges in regard to scientific and technological innovation, the flow of production factors, and the alignment of systems and mechanisms.

Looking forward, we will focus on the following areas in our work to promote the development of the Greater Bay Area.

First, we need to uphold the principle of "one country, two systems." What has happened fully demonstrates that "one country, two systems" is the best institutional arrangement to ensure long-term prosperity and stability of Hong Kong and Macao. It is imperative to fully and faithfully implement the policies of "one country, two systems," "the people of Hong Kong governing Hong Kong," "the people of Macao governing Macao," and a high degree of autonomy being granted to the two regions. It is also imperative to maintain a strategic resolve, enhance confidence, unswervingly implement the policy of "one country, two systems" and make sure that it is fully applied without being bent or distorted in any way.

Second, we have to act in accordance with the law. The Greater Bay Area has a unique developmental environment and great policy sensitivity. We will act strictly in accordance with the Constitution and the basic laws of the two special administrative regions, particularly respecting their social and legal systems and the high degree of autonomy granted to them. When handling issues related to Hong Kong and Macao, we will solicit and adopt constructive suggestions from figures from SAR governments and all the other sectors of society, to ensure the legitimacy of procedures, the integration of power and responsibility, and the compliance with laws and regulations.

Third, it is necessary to fully leverage the role of the market. We will ensure it plays a decisive role in resource allocation, and we will continue to free our minds and reduce administrative intervention. We will make greater use of market mechanisms to allocate and integrate quality resources around the globe, in an effort to create a stable, fair, transparent and predictable business environment. We will deepen mutually beneficial cooperation among Guangdong, Hong Kong and Macao, in such fields as trade, business, technology, education, personnel exchanges, youth development, infrastructure connectivity and platform building.

Four, we intend to promote innovation in institutions and mechanisms. We will utilize the systemic strengths of "one country, two systems," the unique strengths of Hong Kong and Macao, as well as the strengths displayed in the early and pilot implementation of reform and opening up in Guangdong, to properly handle possible obstacles resulting from the differences of the "two systems." We will attach importance to innovation, explore ways to enhance synergy of different systems, build "bridges" connecting policies, so as to facilitate the flow of resources and production factors, as well as the integrated development of the markets among Guangdong, Hong Kong and Macao.

Matthew Cheung Kin-chung:

Hong Kong has a special advantage under the "one country, two systems" principle. We have sound rule of law and extensive international connections. We are an international financial center, enjoy a predominant geographical position and have a free and open market. We come out top in rankings on international competitiveness. Hong Kong has been ranked as the world's freest economy for 25 consecutive years. The "one country, two systems" practice is an asset for Hong Kong in the Guangdong-Hong Kong-Macao Greater Bay Area, as well as a key for the bay area to connect with the international community. The Hong Kong SAR government will continue to implement the principle of "one country, two systems" and do its utmost to contribute to the construction of the bay area. Hong Kong will integrate the country's needs with its own strengths, and let the market play its full role. Keeping in view the bigger picture of the country's development, Hong Kong will also seek new growth points for its economy and provide a better life and development opportunities for its citizens. The outline development plan makes clear that Hong Kong's role as an international financial, shipping and trade center as well as as an international aviation hub will be cemented and strengthened. In addition, according to the plan, innovation and high technology will be encouraged here, and the city will establish itself as the center for international legal and dispute resolution services in the Asia-Pacific region. All of this will help Hong Kong build itself into a more competitive global metropolis.

Thanks.

Mi Jian:

You've raised a core question and it is not the first time we have been asked this. Indeed, we will have to address the "one country, two systems" arrangement during the economic integration process in the bay area, otherwise it will impact everything. It took a long while for the outline development plan to roll out, and a lot of study about Macao has been done along the way. How do we practically address this quite complicated issue now that the outline development plan is released? At present it seems the best way out is to simplify, but as to how to simplify is still under discussion.

As to the answer to your question, you can find it in President Xi's remarks at his meeting with the Hong Kong and Macao delegations on last year's event marking the country's reform and opening-up. The essential ideas are: first, Hong Kong and Macao played an irreplaceable role in the Chinese mainland's reform and opening-up process; second, the biggest reason behind their irreplaceable role was exactly the "one country, two systems" principle; and, third, Hong Kong and Macao are expected to continue to contribute to the country's new round of reform and opening-up, and the precondition of this is, of course, "one country, two systems." Therefore, the key to the success of this round of reform and opening-up is to continue practicing "one country, two systems." The new round of reform and opening-up is actually closely related with the construction of the bay area. You don't have to be too worried about this.

The Southern Daily:

Here is my question: Hong Kong and Macao are home to numerous research and higher educational institutes, where there are plenty of talented young people desiring innovative jobs or eager to establishing start-ups in the mainland. At the same time, the Outline has stipulated that the Greater Bay Area should support young people from Hong Kong and Macao to get employed or establish their own businesses. Therefore, I would like to know what achievements Guangdong province has made in shaping up incubator facilities backing innovation and entrepreneurship? What measures are in the pipeline? Besides, how can the governments of Hong Kong and Macao SARs assist their young people to seize the opportunities emerging from development of the Greater Bay Area?

Lin Shaochun:

Thanks for your questions. Young people from Hong Kong and Macao have always been welcome to work or start their own businesses in Guangdong province. According to incomplete statistics, over 360 start-up teams of young people from Hong Kong and Macao have settled in Nansha of Guangzhou, Qianhai of Shenzhen, and Hengqin of Zhuhai, since the establishment of relevant support platforms. These start-up teams are involved in cyberspace development, finance, science and technology, biology and medicines, and they have created job opportunities for nearly 4,000 people and made significant achievements. From now, the Guangdong government will upgrade the platforms and improve relevant policies on stimulating start-ups and increasing the number of jobs available. To be specific, we will improve platform functions in the following aspects: First, we will establish a base at provincial level in the Greater Bay Area for young people from Hong Kong and Macao to work for innovation concerns or start their own businesses. At the same time, we are seeking insightful exploration of the existing platforms in Qianhai, Nansha and Hengqin, summarizing their operational experiences to offer more precise services in future. We'll expand the platforms to other six cities within the Greater Bay Area. Therefore, there will be 12 platforms in total to help young people from Hong Kong and Macao to develop their careers.

Meanwhile, our policies are designed to improve relevant backup services. First, Guangdong province is addressing employment and start-up services with supportive policies and positive fiscal measures, targeting all young people from Hong Kong and Macao working in the Area. We plan to buttress the policies for encouraging local young people to seek jobs or start their own businesses in the province, which can also be applied to the young people from Hong Kong and Macao, and we will offer our support as long as they abide by the laws. Second, we will create a convenient business environment, streamlining administrative registration and providing a one-stop service for them, as we find they are unfamiliar with how to handle their tax obligations or apply for bank loans. Third, we will continue to review the supportive policies concerning their accommodation, medical insurance and taxation. In this regard, we are conducting holistic analysis and thorough research. All in all, young people from Hong Kong and Macao are welcome to seek employment or carry out a business in Guangdong, where we offer our all-around support to them. We hope they can make great achievements here.

Thank you!

Matthew Cheung Kin-chung:

The Hong Kong SAR Government attaches great importance to the development of young people, who are nothing less than our future and our hopes. We hope that young people in Hong Kong will carry the concept of the country, love for Hong Kong, and a vision for the world. We also hope that they can aim high and look far, exploring opportunities outside of Hong Kong.

We encourage Hong Kong youth to participate in the development of the Greater Bay Area, and we strive to provide more space for development and opportunities for Hong Kong's innovative and entrepreneurial young talent. We strive to make the Greater Bay Area a world-class international platform for innovation and entrepreneurship, while promoting the upward mobility of Hong Kong youth and enabling them to participate in the overall development of the Greater Bay Area and the country.

The Hong Kong SAR Government will integrate the innovative and entrepreneurial resources in the Greater Bay Area and build a sustainable ecosystem to support Hong Kong youth's innovation and entrepreneurship, using the region's youth innovation and entrepreneurship base as its core.

Specifically speaking, the Hong Kong SAR Government will work with non-government organizations to provide entrepreneurial Hong Kong youths with subsidies, support, counselling, guidance and incubation services, as well as work with the Guangdong provincial government to set up a Greater Bay Area Hong Kong Youth Innovation and Entrepreneurship Base Alliance, and to build a one-stop publicity and compatible platform to support Hong Kong entrepreneurs to develop and settle in the Greater Bay Area.

Thank you.

Mi Jian:

The Macao SAR Government attaches great importance to youth work. This is not only a topic in the Guangdong-Hong Kong-Macao Greater Bay Area, but has also been a key task for us for a long time.

As a department that provides advice to the Chief Executive for decision-making and government administration, we are deeply aware of the SAR Government's input in this regard. When the Chief Executive led a government delegation to visit nine cities in the Greater Bay Area last year, he took a special youth delegation along to follow the government delegation on their tour in the region.

Last year we also held a youth forum in the Greater Bay Area. At the forum, young people from the region were given the opportunity to exchange ideas, and in particular, the forum made the young people from Macao realize the demands and challenges facing them on the advent of the Greater Bay Area.

More than a hundred years ago, there was a saying by Liang Qichao that everyone in the room knows: "When young people are strong, China will be strong." We also pointed out at the forum that the future Greater Bay Area is the Greater Bay Area of the youth. So if the young people in the Greater Bay Area are strong, the Greater Bay Area will be strong.

In this regard, the SAR Government has done a lot of work. First, we have implemented the "Thousand Talents Plan" which allows young people to participate in exchanges and study in the mainland, so as to prepare them for innovation and entrepreneurship. The young people in Macao are largely accustomed to staying in their comfort zone and are unwilling to step out. Now we will tell them, you must face this era and embrace the era of the Greater Bay Area.

Second, we have implemented the youth's Greater Bay Area innovation and entrepreneurship program. Third, we provide an interest-free business loan with a ceiling of 300,000 yuan to support young people's enterprises. Many young people rely on this government policy to go to Hengqin and other cities in the Greater Bay Area to start their businesses.

Fourth, for several consecutive years, the "Macao Youth Entrepreneurship & Innovation Delegation" has been organized to study innovation and entrepreneurship experiences in the mainland. Fifth, we have set up a one-stop youth innovation and entrepreneurship platform in Zhongshan. In addition, Governor Lin said just now that we provide practice platforms for young people in Hengqin, Nansha and Qianhai. There are many specific tasks involved that I won't elaborate at this time.

Ta Kung Pao:

The outline development plan calls for strengthening strategic emerging industries and nurturing particular major industry projects such as 5G technology. We wonder if the 5G technology will be commercially used first in the Hong Kong and Macao regions? Thank you.

Luo Wen:

5G is regarded as one of the core technologies representing the new round of technological revolution and industrial transformation. It is also the strategic information infrastructure for the Internet of Things and human-machine interaction. China has placed great importance on the development of 5G technology and is stepping up the commercial use of this technology. In accordance with the requirements of high-quality development, relevant departments are improving coordination and enhancing policy guidance, so as to make a primary plan to promote 5G research and its commercial application, which relies on the dominant role of enterprises and focuses on industry development. We support the enhanced synergy and exchange between enterprises of the Greater Bay Area and encourage them to share their achievements. We encourage telecom operators in Hong Kong and Macao to make commercial use of 5G technology and make the technology better serve the residents there. In the next stage we will, together with other involved departments, proactively advance the work in this regard. Thank you.

Xinhua News Agency:

We know that the Guangdong-Hong Kong-Macao Greater Bay Area is actively building an international science and technology innovation center. Presently, the Outline Development Plan lists this center as one of specific tasks in the first chapter. My question is why the central government is supporting Guangdong, Hong Kong and Macao to jointly build this innovation center? What is the next step in the project, and how will the three places move it forward? Thank you.

Luo Wen:

Thank you for your question. General Secretary Xi Jinping once described the vision of the construction of the Guangdong-Hong Kong-Macao Greater Bay Area: It will be a dynamic and internationally competitive first-class bay area and a model for high-quality development. To achieve this, building an international science and technology innovation center is a top priority, a key of all keys, and this is one of the most agreed-upon and advantageous parts of the construction of the Greater Bay Area. It shoulders the historical responsibility of setting a new high point for innovation and development in our country, and driving the Pearl River Delta region to take the lead in achieving innovation and transformation. The reason why the central government should support Guangdong, Hong Kong and Macao to jointly build an international science and technology innovation center is mainly based on the following three aspects:

First, there is an urgent need to improve the overall layout of China's regional innovation and to accelerate the shift of economic development to becoming innovation-driven.

The Greater Bay Area's science and technology innovation center follows the examples set by the two science and technology innovation centers in Beijing and Shanghai, and has been planned, arranged and promoted by General Secretary Xi Jinping in person.Through the construction of the science and technology center, we can fast-track the full integration of scientific and technological innovation into the real economy, modern finance and human resources. We can also promote the economic aggregates of these three massive urban clusters — Beijing-Tianjin-Hebei, Yangtze River Delta, and Guangdong-Hong Kong-Macao Greater Bay Area — which account for nearly 40 percent of the country's economy, to be built into an innovative economy, in turn leading the transformation of China's economy as a whole into one that is driven by innovation.

Second, we will give full play to the comparative advantages of Guangdong, Hong Kong and Macao and maintain the fundamental requirements for long-term prosperity and stability in Hong Kong and Macao. Guangdong, Hong Kong and Macao complement each other powerfully in terms of innovation. By co-constructing the science and technology innovation center, Hong Kong and Macao's advantages in basic research, talent cultivation, modern finance and knowledge-intensive services will be amplified. This will then interact with Guangdong's real economy, extending the industrial chain and innovation chain, opening up broad market space and maintaining long-term prosperity and stability in Hong Kong and Macao.

Third, we will make use of Hong Kong and Macao's internationalization, and drive the Greater Bay Area to accelerate their incorporation into the global innovation network. Hong Kong and Macao are two of the world's free trade ports, with flexible market mechanisms and a high degree of internationalization. They have established extensive innovation connections with major countries and regions around the world. By co-constructing the science and technology innovation center, they will attract high-level innovative talent, enterprises and scientific research institutions to gather in the Greater Bay Area, which will encourage the enterprises, technologies and standards of the Greater Bay Area to venture out and deeply integrate into that global innovation network.

In the next step, based on the decisions and deployments made by the central government, the National Development and Reform Commission (NDRC) will coordinate with other relevant departments, as well as with Guangdong province, Hong Kong and Macao, to build a splendid scientific and technological innovation center for the Greater Bay Area in the following aspects:

First, we need to establish an appropriate working mechanism. According to the deployment of the State Council, the NDRC will set up a team designated to work for the scientific and technological innovation center under the leadership of the Greater Bay Area Construction Leading Group. It will coordinate the work on how to chart roadmaps, develop policies, distribute assignments and allocate resources. With the support from relevant departments and local governments, the innovation center can be run jointly from top to bottom.

Second, we will devise coordinated policies. We support the pilot operations of innovative cooperation zones in Shenzhen and Hong Kong, in Zhuhai's Hengqin, and in Guangzhou's Nansha, spearheaded in the policies designed to protect Intellectual Property Rights, supervising markets, developing scientific and technological finance, creating talent pools and encouraging high-tech applications. We will establish cross-border platforms to facilitate the flow of various elements, facilities, creative development and people-to-people interconnectedness, bringing deepened innovation-centered structural reform not only to the Greater Bay Area but also the country as a whole.

Third, we want to ensure that the major programs run well. Based on the scientific and technological innovative corridor comprising Guangzhou, Shenzhen, HK and Macao, we plan to make good use of central governmental, regional and social resources, spending them on a number of infrastructure developments for major scientific and technological projects, interdisciplinary research platforms and frontier high-tech innovation centers. We want to bring about a batch of high-quality innovations, establish a host of highly internationalized sci-tech centers, leading more regional and social investment and attracting top-end higher educational institutes, research and R&D centers to develop in the Greater Bay Area, upgrading the scope and prominence of regional sci-tech centers.

Fourth, we intend to deepen reform and cooperate for expanded innovation. We want to remove the obstacles that affect the easy elemental flow of talents, technologies, funds, facilities, information, data and samples and support deepened cooperation among Guangdong, HK and Macao. The reform at the pilot zone level can be escalated to a higher standard and expanded to more extensive spectrums so that the communication, exchanges and innovative cooperation of the three regions can take on a new shape. We will fully adhere to the internationalization drive, grasping and making full use of global resources, to support the enterprises, standards, technologies and products to go abroad and expand the dimensions of innovation, cooperation and openness.

Lin Shaochun:

As far as I know, scientific and technological innovation in the Guangdong-Hong Kong-Macao Greater Bay Area is not only a necessity to lead economic development, but also for strengthening areas of weakness. The Greater Bay Area covers an area of 56,000 square kilometers, has a population of more than 70 million, and an aggregate economy now valued at more than US$1.5 trillion.

Compared with other bay areas in the world, such as the San Francisco Bay Area, there are shortcomings in our technological innovation. Key laboratories and scientific and technological institutions in Stanford University, University of California, Berkeley and the University of California are highly developed. The Tokyo Bay Area, where the University of Tokyo is located, is also home to many Nobel Prize winners.

The Guangdong-Hong Kong-Macao Greater Bay Area enjoys special favors from nature, and has a large population, an industrial system complete with all necessary departments, and a very well-developed manufacturing sector. From a strategic perspective, the central government has put science and technology in first place to lead local development, which is, I think, very much to the point.

Guangdong still has a long way to go, and I would like to explain this point in more detail. While implementing central government decisions, the province will promote the establishment and improvement of cross-border scientific research cooperation systems. Guangdong has its own advantages, as do Hong Kong and Macao. Guangdong's advantages include a complete range of scientific research and industrial application systems, which can pool resources to get the big jobs done. The advantages of Hong Kong and Macao's include high-end scientific research forces and high-level internationalization and marketization. So, how can we combine the advantages of all partners?

First, we will establish a cooperative mechanism to bring the various advantages into full play. We will organize and guide all the major enterprises, research institutes and universities in the Greater Bay Area to deepen their basic and applied basic research, and to participate in the key projects launched in Guangdong. According to General Secretary Xi Jinping's instructions to Guangdong, the projects will cover nine aspects – generation of new information technology, equipment manufacturing, biomedicine, a green low carbon approach in development, the digital economy, new materials, the marine economy, engineering technology and seedling industry of modern agriculture.

Second, we will work in close cooperation with Hong Kong and Macao to build a science and technology innovation corridor linking Guangzhou, Shenzhen, Hong Kong and Macao. The project will focus on accelerating the building of the necessary technological infrastructure and frontier subject research platforms. At the same time, we will build the Shenzhen-Hong Kong Science and Technology Innovation Cooperation Zone, the Sino-Singapore Guangzhou Knowledge City, the Nansha-Qingsheng Science and Technology Industrial Park, and Hengqin Traditional Chinese Medicine Industrial Park as the bases to speed up the commercialization of R&D achievements.

Third, we will explore ways to strengthen resource sharing and promote the exchanges of innovative elements. We will no longer impose restrictions on financial research funds in Guangdong. That means financial funds in Guangdong to support scientific research can be used across the border to Hong Kong and Macao. Moreover, scientific research institutions and laboratories in Guangdong will be fully open to Hong Kong and Macao compatriots. If Hong Kong and Macao universities and research institutes need to use the equipment in Guangdong, they can simply apply. For example, Dongguan's spallation neutron source will be fully open to research institutions from Hong Kong and Macao.

In the next step, under the leadership of the CPC Central Committee, we will further strengthen communication with Hong Kong and Macao, and do more research on supportive policies and measures in scientific and technological innovation. Thank you.

Matthew Cheung Kin-chung:

Hong Kong possesses world-class universities, a strong research capacity, a sound judicial system and intellectual property rights protection system. Hong Kong can make use of its international business environment to pool resources from the mainland and other parts of the world. While attracting international innovation enterprises into the Greater Bay Area, we will also help mainland technology start-ups to "go global," in an effort to promote the development of an international innovation and technology hub. This HKSAR government attaches great importance to innovation and technology, and has earmarked HK $100 billion, or 86.1 billion yuan, for this work. Hong Kong is ready to play an important role in building the Greater Bay Area into an international innovation and technology hub. The HKSAR government sincerely thanks the Central Government for supporting Hong Kong's development of innovation and technology. In the instructions made by President Xi Jinping last May, he said that Hong Kong has a strong science and technology foundation and a large group of high-tech talents; and he praised the contributions made by the Hong Kong sci-tech community to the development of the SAR and the country. He also affirmed support for Hong Kong's development as an international innovation and technology hub. In the past year, the Central Government introduced a number of concrete measures to support Hong Kong, including cross-border allocation of national research foundations, and the decision to set up schools and institutions affiliated with the Chinese Academy of Sciences, as well as placing some of its research institutes at the two innovation and technology platforms established in the Hong Kong Science Park.

Looking ahead, we will intensify our efforts to promote the development of an international innovation and technology hub. The following are the specific measures: first, to support the development of the Hong Kong-Shenzhen Innovation and Technology Park in the Lok Ma Chau Loop; second, to establish a base for research and cooperation by attracting first-class Chinese and foreign companies, research institutes and universities; third, to actively advance the establishment of two innovation and technology platforms on "medical technologies" and "AI & robots" in the Hong Kong Science Park. Our efforts to encourage technological innovation focus on four sectors, namely: biotechnology, AI, smart city and FinTech. The HKSAR government will continue to develop the necessary innovation and technology infrastructure, attract talents, facilitate R&D and promote "re-industrialization," and increase support for the scientific community. I would like to emphasize that the past year has seen remarkable improvement in the innovation environment of Hong Kong. Thank you.

Mi Jian:

Earlier I was introducing Macao's role in the construction of the Guangdong-Hong Kong-Macao Greater Bay Area and I mentioned a "corridor" of international technological innovation linking Guangzhou, Shenzhen, Hong Kong and Macao that is envisioned in the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area. It makes us proud that Macao is seen as an important link of the corridor.

Macao's situation may not be able to compare to what was described by Mr. Lin and Mr. Zhang. However, the city is home to four State key laboratories and this is something special among the city clusters in the Pearl River Delta, especially in the cities along the western banks of the river. Now, the Macao Special Administrative Region government is seeking to enhance cooperation with other cities in the Greater Bay Area via the four laboratories, and exploring cooperation plans.

The Macao SAR government has placed the project in a very important position. Last year, it established a working committee for the construction of the Greater Bay Area. This year we have created a special task force for technological innovation and smart city development, which will be responsible for a series of technological innovation programs to be carried out in the future.

The development of technological innovation carriers and platforms will be accelerated, including the Traditional Chinese Medicine Science and Technology Industrial Park of Co-operation between Guangdong and Macao, located in the Hengqin New Area of Zhuhai, and the platform for development of TCM science and technology industrial park.

Investment in the higher education sector has been taking up a sizable portion of Macao's entire GDP. In recent years, the SAR government has invested heavily in both higher education and scientific research, and it plans to increase input to help higher education institutions and research facilities to actively participate in the development of the Greater Bay Area.

Macao now plans to strengthen cooperation with the Ministry of Science and Technology and the China Association for Science and Technology. By utilizing the technological strengths of the mainland will enable Macao to fulfill its historic responsibility of constituting the envisioned international technological innovation corridor in the Greater Bay Area.

My answer to the reporter's question is that it is in line with the trend of the times for the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area to make international scientific and technological innovation a core aspect. We may say that the Outline Development Plan reflects a deep insight of the global trend. Everyone can see from the recent changes of the world that future socioeconomic development cannot do without the development of science and technology. Only through continued efforts in scientific and technological innovation can our country realize fast growth in manufacturing and the real economy and present a stronger image on the global stage.

Thank You.

Radio Television Hong Kong:

I would like to know how you plan to ease the pressure on Hong Kong and Macao in the process of integration while developing the Greater Bay Area, and what measures will be taken to ensure Hong Kong and Macao residents participate in the development of the Greater Bay Area without concerns? Thank you.

Luo Wen:

Thank you for your question. General Secretary Xi stressed the importance of formulating and improving policies and measures to make it more convenient for Hong Kong and Macao residents to pursue career development on the Chinese mainland, and develop "one-hour living circles." This is the very response to the people's expectations and their pressing need. These measures will continue to address people's growing needs for a better life.

There is a special chapter in the development plan regarding development of a quality circle for living, working and traveling in the Greater Bay Area. It calls for active construction of the "one-hour living circle." In this regard, we will adopt three specific measures:

The first is infrastructure construction. We will promote establishment of an infrastructural network with a rational layout, comprehensive functions, smooth connections and efficient operations, so as to achieve an average one-hour commuting between the major cities in the Greater Bay Area.

The second is customs clearance facilitation. We will continuously raise the level of convenience in the use of the Mainland Travel Permit for Hong Kong and Macao residents through the means of digitalization and informatization. We will increase the number of automatic clearance channels for inbound and outbound travelers at major land control points, so as to achieve 24-hour customs clearance at more ports. We will also enhance collaboration between Mainland customs authorities and those of Hong Kong and Macao to further enhance efficiency of cross-border logistics.

The third is about public services. We will enhance the dovetailing of cross-boundary public services and social security, and facilitate reductions and even removal in long-distance and roaming charges for mobile phones in Guangdong, Hong Kong and Macao. We will also enable eligible children of Hong Kong and Macao residents to enjoy the same rights as Mainland residents regarding compulsory education and senior secondary education, and improve the linkage mechanism for emergency medical rescue services to provide residents in the Greater Bay Area with timely, efficient and convenient public services.

Mi Jian:

I understand the point of your question from the Macao perspective. First, there is a need to face the increasingly open trend of the times. No city can progress if it closes itself off, and we have to deal with some pressure from this process. In recent years, Hong Kong and Macao have seen the entry of large numbers of tourists. I noticed that Macao was full of people during the Spring Festival, and Hong Kong faced similar pressure; however, as I have often discussed with young people, the reason why Macao is where it is today is that it is an open and international city. The same applies to Hong Kong. Therefore, we must mentally prepare ourselves for the pressure brought by the flow of people with development of the Greater Bay Area. However, that does not mean we will do nothing about it and let it continue unchecked. This must be avoided, and requires the wisdom of government departments. It is also necessary for the three places to cooperate. However, all in all, it is a trend that we must face. Thank you.

Xi Yanchun:

The development plan aims to enable the people of the three regions to live a better life. It will also take into account the needs of the three places in various aspects.

TDM:

The outline plan mentioned that Macao is required to work together with adjacent cities on disaster prevention. My question is how that work, which involves Guangdong, Hong Kong and Macao, is going so far. Thanks.

Lin Shaochun:

Thank you for the question. In the Greater Bay Area, Guangdong and Macao share close cooperation in this regard. I believe you must be aware of the typhoon in 2017, which led to two days of blackouts and seawater encroachment in the area. The challenge is how to prevent natural disasters. We have made efforts as follows. First, we have built a meteorological information sharing system to forecast inclement weather. The three places have joined this system, which can accurately forecast weather disasters and related information.

Second, we have formed a mechanism that requires us inform each other of pertinent and timely information before disasters occur. That is to say, Guangdong must keep related departments in Hong Kong and Macao advised of relevant information, and vice versa. By this process, the three locations need to collaborate with each other to resolve disaster prevention problems together. We discuss the issues together.

Third, more specifically, we have installed a two-circuit electrical supply in Macao, improving the reliability of Macao's electricity through underground cable. Additionally, you may be interested in the tide gates. Fernando Chui, chief executive of Macao, cares profoundly about this issue, and he came to Ma Xingrui, Guangdong's provincial governor, to talk about it. Guangdong supports Macao initiating the work. After the project is approved, the two sides will assess its ecological and environmental influences and conduct accurate monitoring and measuring of astronomic tide data, in a bid to roll out an effective prevention and control method. We are building these mechanisms and will continuously improve relevant facilities, working together to effectively prevent and control natural disasters. Thank you.

Mi Jian:

Let me supplement by talking about some of the work done by Macao. Your question relates to Typhoon Hato on Aug. 23, 2017, which caused the loss of life and property in Macao. The disaster shook the special administrative region, and offered a profound lesson to the SAR government. Consequently, within three months, the design of the tide gate was approved. Chui, the chief executive of Macao, has been involved in the entire process, collaborating with Ma Xingrui and Lin Shaochun, Guangdong's provincial governor and vice-governor. The project is supported by the Ministry of Water Resources, and has demonstrated high efficiency in regional cooperation.

As for now, the draft of our 10-year disaster prevention and reduction plan has undergone six revisions. A critical component is the tide gate, which has come to the phase of technological verification. Although the tide gate's basic plan is workable, it still requires comprehensive analysis of astronomical and meteorological data, as well as tides and water supply, to determine whether it can be built and managed effectively. It is a very complex project. But you can send a message to Macao citizens that they can rest assured that the Macao SAR government is treating this with the utmost importance, and will not allow Macao to experience another situation like Typhoon Hato of Aug. 23.

China Business Network:

My question is related to the capital markets. There are two major stock exchanges in the Greater Bay Area in Hong Kong and Shenzhen. I would like to know, in the process of the construction of the Greater Bay Area, how can the two exchanges contribute to its development. Another concern is the future reform of the growth enterprise market of the Shenzhen Exchange, as we know both Shanghai and Hong Kong have made some institutional breakthroughs in supporting technology innovation enterprises to be listed. What will be the key point of Shenzhen Exchange's reform in the future? Thanks.

Lin Shaochun:

Thank you for the question. As you said, finance is very important in the construction of the Greater Bay Area, and the financial industry is of great significance to the economic development of Guangdong, whose gross domestic product reached 9.72 trillion yuan last year, with more than eight percent contributed by the financial industry's added value. I think we should make efforts in the following aspects to promote the development of financial industry while constructing the Greater Bay Area.

First, the finance must be stable and free of problems. If there is something wrong with finance, the influence upon the whole economy is unacceptably great. So, we must abide by the State's relevant financial policies to boost the development of financial industry in the Greater Bay Area. Second, you mentioned that Shanghai has transformed its approval system to a registration system regarding technology and innovation-based enterprises' application for stock market listing. We are also seeking support from the central department for this. Currently, we are following the central government's requirement and improving the relevant conditions. Third, we follow the central government's requirements to strengthen supervision in preventing financial risk. Among the three difficult battles involved, the first is to prevent and control financial risk. In future, we must ensure the financial industry serves economic development, and healthy development of the financial sector. Thanks.

Economic Daily:

Accelerating the connection of infrastructure facilities is an important support element for construction of the Guangdong, Hong Kong and Macao Greater Bay Area. But apart from the hardware connections, society also expects more convenient management measures to facilitate the exchanges of people and transport vehicles, so as to promote the flow of production factors. My question is: what consideration, if any, is being given in this regard.

Luo Wen:

Thank you for the question. The efficient flow of production factors is not only a foundation for market integration and Greater Bay Area construction, but also an issue society cares about and that should be solved. General Secretary Xi Jinping has pointed out that we should strengthen the "soft connection" of mechanisms and "hard connection" of infrastructural facilities. We must implement his important guiding spirit to promote the efficient flow of production factors. Specifically speaking, we need to do two jobs well.

First is the "hard connection" of infrastructural facility construction. We should plan it as a whole and expedite planning of construction of inter-city railways and connection of the infrastructural facility construction in the Greater Bay Area, among which the connection of the Mainland with Hong Kong and Macao, and the connection between the east and west banks of the Pearl River are key jobs. We should further improve the network of major railways in the Greater Bay Area, and construct an express inter-city transportation network consisting of high-speed railway, inter-city railways and high-speed roads. We need to improve the Pearl River Delta port cluster's international competitiveness, and accelerate the construction of a world-class airport cluster.

Second is the "soft connection" of institutions and mechanisms. The work should be led by the construction of an international science and technology innovation center, a focus on science and technology innovation, personnel exchanges and some other key areas, and promoting the rollout of systematic pro-innovation policies to facilitate the flow of science and technology talent and research cooperation.

We should strengthen collaboration among the customs departments and ports in Guangdong, Hong Kong and Macao, to expand and improve their functions, and facilitate customs clearance in the three places according to law, so as to make it more convenient for personnel exchanges between the Mainland and Hong Kong and Macao. We are working to optimize policies allowing Hong Kong and Macao single-plate registered automobiles to enter the Mainland, and exploring the possibility of letting Hong Kong and Macao residents living and working in Guangdong, to enjoy the same welfare level in education, medical care, pension, housing and transportation as their Mainland counterparts. Thanks.

Xi Yanchun:

I'd like to thank our four speakers for attending this news conference. Thank you all. That's the end of today's event.

.

Read in Chinese

Speakers:

Li Xiaopeng, minister of transport

Liu Xiaoming, vice minister of transport

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office of China

Date:

Feb. 28, 2019

   

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference. The development of transport has received a lot of attention in our society, and has improved people's sense of fulfillment and happiness. To help you better understand the issues concerning transport development, today we are delighted to welcome Mr. Li Xiaopeng, the minister of transport, to explain the planning and progress of supply-side structural reform and the development of high-quality transport. He will also answer your questions. We also have with us Mr. Liu Xiaoming, the vice minister of transport. At this time, I'll give the floor to Mr. Li.

Li Xiaopeng:

Thank you, Mr. Hu. Ladies and gentlemen, members of news outlets, good morning to you all. I am very happy to be here today. Mr. Liu Xiaoming and several of my colleagues will join with me today to introduce the development of China's transportation and answer any of your questions.

In 2018, China's transportation industry was proactively implementing the decisions and deployment made by the CPC Central Committee and the State Council, from the perspective of serving the public, overall situation, and the grassroots community. It should be said that we have made significant progress.

First, the infrastructure has been improved. Last year, the fixed-asset investment in transportation amounted to about 3.2 trillion yuan, of which 800 billion yuan was in railways, 2.3 trillion yuan in roads and water transportations, and 80 billion yuan in civil aviation. More than 2,600 kilometers of high-speed railways and 5,000 kilometers of newly-built highways have been put into operation. Second, logistics costs are further reduced. We have taken a series of measures to reduce logistics costs by 98.1 billion yuan in 2018. Third, the transportation structure has been adjusted. The focus has been shifted from large-scale, long-distance cargo to rail transport. The volume of rail transport increased by about 350 million tons last year. Fourth, both the capacity and service of the transportation systems have been improved. Last year, the number of passengers nationwide reached 17.9 billion, the volume of cargo reached 50.6 billion tons, and the volume of express delivery reached 50.7 billion. Fifth, the business environment has been improved. Last year, a total of five administrative examination and approval items were canceled, and another 20 administrative approval items were made possible to be reported online. Sixth, there has been an increase in the modes of transport that are on offer. Ride-hailing services and shared bicycles have been standardized, with an average of 20 million people using ride-hailing services and about 10 million people using shared bicycles on a daily basis.

Li Xiaopeng:

In 2019, we will focus our work on promoting the high-quality development of transport and the supply-side structural reform of the transport industry. We will implement the eight-character policy of "consolidation, improvement, enhancement and facilitation". We will consolidate the achievements in improving weak links and lowering costs, and we will also expand the achievements. We will improve the operating environment and services, enhance the innovative growth and the momentum of growth, and facilitate national economic development through further raising efficiency and integration. We will lay stress on six principle points in this year's work – improving efficiency, lowering costs, ensuring safety, deepening reform; expanding openness; and promoting innovation.

We will follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, implement the decisions made by the 19th National Congress of the Communist Party of China (CPC), the second plenary session of the 19th CPC Central Committee and the third plenary session of the 19th CPC Central Committee. We will follow the Party's line, principles and policies and ensure the decisions and plans of the Party and the State Council are fully implemented.

We need to seize opportunities, make progress while maintaining stability, and remove obstacles so that we can forge ahead. We will work hard in close collaboration to meet the increasing demands of the people for better lives and for better transportation facilities. We are doing our best to make our transport system more convenient and smoother. We are looking forward to celebrating the 70th anniversary of the founding of the People's Republic of China with our outstanding achievements.

Thanks for listening to my briefing. Now, Mr. Liu Xiaoming and I would like to take your questions. Thank you.

Hu Kaihong:

Thank you Mr. Li. Now, the floor is open to questions. Please identify your media organizations before asking questions.

CCTV:

I would like to ask Minister Li, as this year is also the fifth anniversary of General Secretary Xi Jinping's important directives known as the "Sihao Rural Roads" ["Four Good Principles on Rural Roads"]. As an important emerging force for rural revitalization, what kind of welfare does the transportation industry bring to the people in rural areas?

Li Xiaopeng:

Thank you for your question. The "Sihao" of "Sihao Rural Roads" refers to four elements essential to rural roads: good construction, good management, good maintenance and good operation. This "Sihao," also known as "four good principles," was summarized and proposed by General Secretary Xi Jinping himself, in order to lead a project that will win people over, benefit their livelihood, and be generously administered. The first time the general secretary gave instructions on the "Sihao Rural Roads" was in March 2014. It has been five years since that, and in that five years, the Ministry of Transport has implemented the important instructions of the general secretary, and worked with related departments and provinces, autonomous regions and municipalities to promote the construction of the "Sihao Rural Roads" according to the "four good principles."

To review the achievements of the past five years, we can say three sentences to conclude: First, the scale of the rural road networks has expanded; second, a structure for joint construction and joint administration has been formed; third, the service level has been steadily improved. In terms of the scale of road networks, in the past five years we have built and renovated 1.392 million kilometers of rural roads. By the end of last year, the total mileage of rural roads reached 4.05 million kilometers, and 99.64 percent of towns have hard-surfaced road access, while 99.47 percent of the administrative villages have hard-surfaced roads installed. In terms of the administration structure, 31 provinces, autonomous regions and municipalities have attached great importance to the implementation of the "Sihao Rural Roads," issuing instructions on how to construct and implement them, or incorporating this work into the government assessment system. The pattern of joint construction and joint administration has taken initial shape. In terms of transportation services, when the roads open, the traffic should also be there. By the end of last year, 99.1 percent of the townships and 96.5 percent of the administrative villages had buses services. Once they have buses, farmers can step onto the paved roads and hardened roads, and board the buses. They can get around more conveniently. 

Of course, even as we celebrate the achievements, we must also be aware of the problems and weaknesses. The first is that the demands for construction are still huge. Everyone may ask, you just said that more than 99 percent of the towns and villages have paved the hardened road, so then how can you still need a large scale of construction? But our country is too big, even 0.1 percentage points represents a big number, and there are still many rural areas that have no hard-surfaced roads. Second, the issue of maintenance is still outstanding. After a road is built, how to maintain it, how to manage it? Although there is a preliminary institutional mechanism, it is still not perfect. Third, there have been some phenomena, such as asphalt roads turning back into sand, or "good roads going bad" due to lack of maintenance, because the standards of early construction are not high; or due to other problems, the roads that once were smooth now became less clear. Fourth, the laws and regulations as well as systems and standards are still not perfect. Finally, the accountability system is not yet fully established. All these issues must be given full attention and resolved in seriousness.

We'll better implementation of rural road construction in the next stage according to the "four good principles." There are generally three points related to our efforts. First, we need to increase involvement, accelerate construction and overcome obstacles. Second, we need to improve our planning and our polices, laws, regulations and standards. We are drafting "Opinions on how to Press Ahead with Quality Development of Rural Roads by the Four Good Principles." 

Regarding legal aspects, we have drafted "Rural Road Regulations" after soliciting public opinions, based on which we are rectifying the legal items. We'll do our best to carry this out as soon as the legislative procedure allows. 

Third, we need to strengthen our implementation. As with any task, we need to implement construction of rural roads soundly, specifying in detail the measures and approaches in different locations and regions, with regard to grass-roots communities in particular. There are designated personnel to take charge of each road and they ought to be motivated to ensure the smooth operation of roads in line with the "four good principles." We expect their experiences to be shared. We'll also move forward with the selection of model counties that excel in the construction and operation of rural roads according to the "four good principles" in all ways, making them locomotives to lead the rest of the regions in their construction of rural roads.

All in all, the construction of rural roads is important to help farmers rise out of poverty and enable them to lead decent lives. It also serves as a key strategy to fulfill rural rejuvenation and has a major impact on agricultural and rural modernization. The Ministry of Transport will, therefore, work hard on the instructions of President Xi Jinping, with all involved departments and regions making a concerted effort to push this construction forward. Thank you.

Xinhua News Agency:

A dozen cities, including Beijing, Shanghai, Guangzhou and Shenzhen, have rolled out some policies concerning the road test for automatic driving, Has the Ministry of Transport granted any policy support this development?

Li Xiaopeng:

Thank you for your question.

Since automatic driving is a cutting-edge technology in the area of transportation, we pay close attention to research and development into self-driving technologies. In last April, the Ministry of Transportation, the Ministry of Industry and Information Technology and the Ministry of Public Security jointly issued a pilot regulation for the road testing of intelligent connected vehicles, marking the first time a national guideline on road testing for self-driving vehicles has been issued. Last July, the Ministry of Transportation issued provisional measures for the construction of closed test sites for automatic driving, which will serve as a guide for the construction of closed test sites across the country. At present, we have authorized three such units, one each in Beijing, Chongqing and Xi'an.

All of these moves demonstrate our emphasis on the technology, especially in regard to its application. The development of automatic driving is of great significance for ensuring safety, enhancing efficiency, improving services and promoting industry growth. Our principle is to encourage exploration, tolerate failures, ensure security and oppose monopoly. Next, we will undertake the following work.

First, we should strengthen inter-ministerial coordination, and establish a cross-departmental coordinative working mechanism with relevant ministries, to develop a guidance system for the development of autonomous driving. Secondly, we should strengthen R&D and test verification of key technologies and equipment to achieve synergy between automatic driving and road improvements, and promote the formulation and revision of the relevant standards. Third, we should speed up research, formulation and promulgation of relevant laws and regulations in the field of automatic driving. Fourth, the pilot projects of application and commercialization should be carried out in a steady and prudent way. We have already established pilot projects in some localities. For instance, we have selected some areas in Zhejiang province, Xiamen and Xiongan New District as pilot demonstration areas. Fifth, we should strengthen international cooperation on self-driving technologies with other countries.

Self-driving is a new and vibrant technology. It requires time to put the technology into full use. We need to work together to make it safe and promote its application as well as related services. 

Legal Evening News:

A multi-department group including supervisors from the Ministry of Transport began their in-house safety inspection at China's ride-hailing firms last September. What progress has been made in ensuring these platforms' compliance with regulations? What measures will be introduced to tighten supervision over them? Thank you.

Li Xiaopeng:

Thank you. Mr. Liu will answer your question.

Liu Xiaoming:

Thank you for your question. As you know, transport is at the forefront of the internet economy, and the development of mobile internet has led to a marked rise in new forms of transport business. As one of the new forms, ride-hailing is an innovative transport service offering better travel experience, and also a more convenient way of commuting. However, this new business also faces many problems, including excessive growth, unhealthy competition and safety loopholes. 

In recent years, a series of regulatory measures have been introduced at the national level, gradually putting ride-hailing services on track toward orderly development. Of course, intensified efforts are still needed to make further progress.

To address the safety concerns of ride-hailing and car-pooling services, on Sept. 5, 2018, an in-house joint inspection, by the relevant departments of the inter-ministerial joint conference on coordinated oversight on new forms of transport, as well as the Department of Emergency Management, launched an investigation to detect safety loopholes and problems involving eight major entities in the industry, including Didi Chuxing, Shouqi Yueche, Shenzhou Zhuanche, Caocao Zhuanche, Yidao Yongche, Meituan Chuxing, Dida Chuxing and AutoNavi. The inspection groups pointed out various problems they identified in regard to safety and the services being offered, and gave each of those involved relevant rectification requirements. To date, all of the eight entities platforms have produced their respective rectification plans and published them on the website to solicit for public opinions. The rectification work is now underway.

The General Office of State Council issued a guideline in July 2016 to actively and steadily promote the reform of the taxi industry. Seven ministries, including the Ministry of Transport, also released a joint order to strengthen the management of online taxi booking services. A series of support measures were drafted to guide local governments to extend reform of the taxi industry, improve the management of online ride booking services, reinforce joint supervision, and particularly to speed up compliance from online taxi booking companies.

The online taxi booking industry has now stepped onto the path of standardized development. About 247 cities across the country have taken specific measures to regulate online ride hailing services. Internet enterprises, regular taxi companies, car rental companies and vehicle manufacturers will all participate in the taxi industry actively and lawfully, making people's transport options more diversified and convenient. So far, over 110 online taxi booking platforms have obtained management permits; about 680,000 drivers and 450,000 vehicles have been given certificates to provide online ride booking services. Despite the smooth progress, we also acknowledge that there are various problems and contradictions interwoven, and that deepening the reform of the taxi industry is a highly complicated and systemic task. The Ministry of Transport will urge local authorities to fulfill their responsibilities and implement related policies. We will do more research and evaluate the implementation of policies in due time. We will also gradually establish a more diversified system to promote the taxi industry's sound and sustainable development to better facilitate transportation.

Yicai.com:

Another question about the ride-hailing industry. Many of the involved companies felt a burden amid the downward economic pressure since last year. Recently, Didi Chuxing said it would be cutting jobs. Moreover, drivers and suppliers have complained about overdue payments from Yidao Yongche around the Spring Festival. What will the ministry do to deal with such problems?

Liu Xiaoming:

Thank you. I think the general public are also extremely concerned about these questions. Transport, both the traditional and new forms, are involved in the transportation of tangible goods and providing service. Despite the development of the ride-hailing industry and other new business forms, the nature of transport won't change. Commercial capital investment and the internet may help some new business forms grow rapidly at first, when enterprises seek growth through single-minded pursuit of traffic flow and added value. As a result, they fail to establish a successful business mode featuring both profit pursuit and sustainable growth. Seeking unchecked growth also creates management loopholes such as high safety risks, lack of strict verification for drivers and vehicles, and information security vulnerabilities, all of them of great public concern. The Ministry of Transport has been promoting the development of new business forms based on the principle of putting passengers first, encouraging innovation, never crossing a certain line, seeking benefit and avoiding harm, seeking orderly development, and conducting regulation in a tolerant and prudent way.

It seems the unhealthy growth of new business forms isn't going to last for long. Through a comprehensive in-house inspection launched by the ministry last year, some ride-hailing platforms came to recognize that passenger safety is their main responsibility, obligation, and the only foundation for further development. All the platforms calmed down and considered whether they could upgrade their systems and overcome their shortcomings, striving to find a development mode more sustainable and acceptable to the public. We heard the news that Didi would cut jobs after the Spring Festival; meanwhile, the company announced it would hire employees possibly more than it would cut to further enhance security systems and improve services. There are some other enterprises facing financial difficulty due to a money-burning subsidy strategy generated by the single-minded pursuit of traffic flow. We pay close attention to the development of the industry, urging the platforms to protect the legitimate interests of both the passengers and drivers, so as to promote rectification and healthy development of enterprises. We will keep track of the development of ride-hailing platforms in the future, in order to defend the rights and interests of both passengers and drivers. Thank you.

Li Xiaopeng:

Just now, two journalists asked questions about online car-hailing, and there may be others interested in issues related to new forms of transportation. We all know  that transportation is a traditional industry; yet, combined with computers, cloud computing, big data and the internet, new types of business will emerge, such as online car-hailing and bike sharing. Vice Minister Liu Xiaoming has alreadyoffered his perspective on this topic, I completely agree with that, and now I'd like to give my comments.

Firstly, integrating with new technology allows a traditional industry like transportation to create new types of business. Thanks to more convenient service, these new forms have become popular. Our attitudes towards them are active support, better assistance and fully cooperation. 

Secondly, like all new things, such businesses are less than perfect and probably bring with them new problems, requiring new ideas in management and supervision. In regard to these new problems and requirements, our attitude can be summed up as inclusive encouragement, prudent management, and regulated development.

Thirdly, both the traditional industry and new types of business are directly serving the people, and are closely connected to people's life and the safety of their property. Transportation concerns everyone's health, property and life. Therefore, all practitioners, no matter whether in the traditional industry or new types of business, have to give top priority to the related safety aspects. Safety is the unchallenged bottom line, so the focus of our supervision of these new types of business is also safety.

Fourthly, new forms of transportation havesignificance in regard to economic development, employment opportunities and sci-tech innovation. In order to provide the best possible management and services for better development and application, governments, enterprises and all walks of life should make joint efforts. Thank you.

Guangming Daily:

What are the achievements we have made in shaping the comprehensive transport system for reinforcing the integration of Beijing, Tianjin and Hebei province and facilitating the construction of Xiong'an New Area?

Li Xiaopeng:

Thank you. The question concerns the integration of Beijing, Tianjin and Hebei province and the construction of Xiong'an New Area. The coordinated development and integration of Beijing, Tianjin and Hebei province is a major strategic deployment of the CPC Central Committee with Comrade Xi Jinping at the core. At the same time, the historic construction of Xiong'an New Area stems from President Xi's initiative, decision and promotion. Last year, the ministry worked in the following aspects, focusing on the two undertakings.

First, we have reinforced top design aspects. We have issued numerous plans and measures to enhance this, such as, "The Implementation Opinions on the Construction of Comprehensive Transport System in Hebei Xiong'an New Area with the Support of the Ministry of Transport (2018-2020)" and the "Three-year Action Plan for the Integration of the Transport System Involving Beijing, Tianjin and Hebei Province and the Comprehensive Transport System of Xiong'an New Area (2018-2020)."

Second, we have facilitated the construction of arterial roads connecting Xiong'an New Area and surrounding areas, started construction of the Beijing-Xiong'an Intercity Railway and accelerated work on a number of construction projects exemplified by the Tianjin-Shijiazhuang [capital of Hebei province] Superhighway.

Third, we have pressed ahead with coordinated development for the integration of Beijing, Tianjin and Hebei province, completing a beltway connecting Tongzhou and Daxing district, around the southeast to southern areas of Beijing. The construction of Beijing Daxing International Airport is now nearing completion and projects linked to the Winter Olympics, such as, the Beijing-Zhangjiakou high-speed railway and Yanqing-Chongli Superhighway are progressing smoothly. 

Besides, we have restructured the transport system to further promote integration.

In 2019, we'll improve our work in the following aspects: First, we'll continue to accelerate the construction of the major traffic system comprising the Beijing-Xiong'an Intercity Railway, the Tianjin-Shijiazhuang Superhighway and the Beijing-Xiong'an and Xiong'an-Shangqiu sections of the Beijing-Hongkong-Taiwan High Speed Railway. Second, we will accelerate work on the Beijing section of the Beijing-Shenyang [capital of Liaoning province] High Speed Railway, Datong-Zhangjiakou High Speed Railway and the Zunhua-Qinhuangdao [Hebei province] of the Beijing-Qinhuangdao Superhighway. We will also accelerate the construction of green ports, in Tianjin and Hebei province, as well as coordinated development of various airports in the region. Third, we will speed up transport system restructuring, directing long-distance and bulky commodities transportation to choose railways or waterways to alleviate the pressure on the roads. 

Fourth, we will speed up Winter Olympics-related construction. Fifth, we will endeavor to provide a good transport service to ensure this year's Beijing World Horticultural Exposition is run successfully. Thanks.

CRI:

We notice that converting the expressway manned  toll booths for mobile payment is on the ministry's 12 things-to-do list in 2019. How is the work progressing now? And what has still to be done? Thank you. 

Li Xiaopeng: 

Thank you for your question. Mobile payment is very convenient and popular. So far, among the 29 provinces forming the country's expressway toll network, 14 have introduced mobile payments at the toll booths, and the other 15 are speeding up their efforts to meet this goal. All the work is expected to be completed by the end of 2019, with mobile payment covering all the manned toll lanes.

However, we still suggest people use the electronic toll collection (ETC) system which is more convenient and environmentally friendly. 

Thank you.

Phoenix TV:

This is a question on the Guangdong-Hong Kong-Macao Greater Bay Area. The area is an important strategic deployment of the country. As the Greater Bay Area aims to integrate its transport systems, what infrastructural development plans does the Ministry of Transport have for the Greater Bay Area?

Li Xiaopeng:

Thanks for the question on the Guangdong-Hong Kong-Macao Greater Bay Area. It is fair to say that transport infrastructural facilities are of great importance for the development of the Greater Bay Area. As of now, the Greater Bay Area has relatively good transport infrastructure facilities; in the future, it needs to be further improved and developed. On Feb. 28, the CPC Central Committee and the State Council published the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area. According to the central authority's deployment, the Ministry of Transport is working on the Guideline Opinions on the Greater Bay Area Transport Development. It lays out some key tasks, which may be of interest to you. 

There are seven aspects. The first aspect is to promote comprehensive foreign-bound transportation aisle construction. The second aspect is to construct rapid transportation networks in the Greater Bay Area. The third aspect is to improve the international competitiveness of the port cluster in the Pearl River Delta. There are many ports in the Pearl River Delta, and the ports' development level is comparatively high. The next step is to improve its international competitiveness. The fourth aspect is to build a world-class airport cluster. There are many airports in the Guangdong-Hong Kong-Macao Greater Bay Area. The next task is to coordinate these airports to help them play more significant roles by improving the efficiency and raising their service levels. The fifth aspect is to enhance the service for both travelers and cargo. After the roads are built, ports are upgraded, and airports are developed, the service level for transport of goods and travelers should be further improved. The sixth aspect is to improve the ability of transport science and technology innovation. The seventh is to build a green ecological transport system. We need to ensure the safety, convenience, and efficiency of the transport of travelers and goods. Moreover, the transport infrastructural facilities and the transport itself should be energy-saving and environmentally friendly.

Next, we will act in accordance with the CPC Central Committee and the State Council's decision and deployment to implement the development plan. We will give full support for the Guangdong-Hong Kong-Macao Greater Bay Area to accelerate the construction of a modern comprehensive transport system with global competitiveness and influence, and promote the development of the Greater Bay Area. Thank you.

Hu Kaihong:

We will hold a press conference on the Guangdong-Hong Kong-Macao Greater Bay Area this afternoon. You are welcome to attend the meeting and raise questions on this topic.

China Daily:

Good morning, Mr. Li. Just now, you spoke of new forms of transport. Here I would like to ask one more question about bike sharing. We all know that the bike sharing company Ofo has stalled on its deposit refunds in the last several months. Currently, there are still more than 10 million online applications for deposit refunds. So, how will the Ministry of Transport respond to the recent problems of the developing bike sharing industry, M. Li?

Li Xiaopeng:

Thank you. Mr. Liu will take your question.

Liu Xiaoming:

Thank you for your question. Bike sharing is a new form of transport, combining the mobile internet and bike rental, which has enjoyed a very rapid development in recent years. It has provided a new convenient choice for people to travel short-distances, playing a very important role in building a green urban travel system.

However, like any other new business form, there are various problems with the developing bike sharing industry: some enterprises have failed to fulfill their due responsibilities, some are involved in vicious competition, shared bikes are messily parked everywhere, and users' rights and interests have not been fully guaranteed.

In August 2017, ten departments jointly issued guidelines on encouraging and regulating online bicycle rental, in which they clearly stated the requirements for user deposit management. However, the guidelines fail to be well implemented in some bike-sharing enterprises. As a result, deposit security and stability risk has become quite a prominent issue. In some cases, enterprises embezzled deposits and could not refund deposits to users. This has aroused widespread concern from the society and also caused many adverse effects.

We have attached great importance to the issue and have taken the following corresponding measures.

First, we have worked with the member units of the inter-ministerial joint conference on coordinated oversight regarding new forms of transport to conduct careful analysis and judgment.

Second, we have guided local transportation departments to make appropriate plans to deal with the problem in accordance with law and fulfill their due responsibilities under the leadership of local government.

Third, we have urged related bike-sharing platforms and enterprises to provide easy and quick access for users to get back their deposits, so as to protect the legitimate rights and interests of users.

Fourth, we are working to strengthen the management of deposits and establish a long-term management system. The Ministry of Transport, the People's Bank of China and other related departments are working together to make relevant measures for the management of user's funds in new forms of transport, including their deposits.

The relevant requirements set out in the instructions from the 10 departments in 2017 are very clear. The first is to encourage enterprises to waive deposits and provide services through credit. The second is to provide services in the form of rent-and-deposit and rent-and-refund. The third is to provide service by means of a deposit with the consent of the user. However, the instructions are also clear that to collect user deposits, the operating company must assume the main responsibility and be strict in the use and management of the deposits. If a user applies for a refund of the deposit, the enterprise must return it in a timely and unconditional manner.

Next, we and the People's Bank of China and related departments need to accelerate the promulgation of measures of deposit management. At the same time, we must work with departments to strengthen the management of deposits, to ensure that deposits go into specific funds, are earmarked for particular use, and cannot be misappropriated. Everyone knows very well that the new modes of transportation are crossover services and crossover operations. The corresponding supervision work requires multi-sector cooperation. With the approval of the State Council, there is now a joint meeting mechanism for the coordination of new modes of transportation. The mechanism will create better conditions for the development of our new modes, and at the same time, we can better strengthen supervision, provide better travel services for the people, and safeguard their interests. Thank you.

Li Xiaopeng:

I think Vice Minister Liu Xiaoming responded in a very clear way to your question. However, I still feel it's worth adding a few more words on this subject. First, bicycle-sharing emerged as a new transportation form offering convenience for people. We encourage and support the operation. Second, the developing bicycle sharing industry is facing a host of problems which have drawn our great concern, such as, parking issues and the guarantee deposit system. We hope it can be addressed with the joint efforts of the different parties. Enterprises, society and governments should make concerted efforts to create a good environment and address emergent problems, ensuring the shared bicycle network can better serve the people. Third, regarding the guarantee deposit aspect, Mr. Liu has made clear we intend to make sure people can enjoy it freely. If the companies insist on some advance payment , they should work out standardized management according to relevant laws. They should strictly follow every regulation stipulating the ways of renting, charging and refunding, adopting specialized and standardized management approaches. Customers are entitled to retrieve the deposit quickly as required. We will enhance our supervision and push relevant regional administrations to address the needs of bicycle sharing in an appropriate way. Those are a few of extra points that I would like to share with you. Thank you.

China News Service:

How does the building of Beijing Daxing International Airport go? When will it come into service? What are the respective tasks for Beijing's two international airports? What are their specific positions? Thank you.

Li Xiaopeng:

Thanks for your question. Building Beijing Daxing International Airport on the border of Beijing's Daxing district and Hebei province's Langfang city is an important national project. It is of great significance for Beijing to optimize its functions and industries. It is also very important for Beijing-Tianjin-Hebei transport integration and the building of the Xiongan New Area.

Started at the end of 2014, construction work has basically finished. Four runways have been connected; the terminal is being equipped and decorated; roof sealing of the five function areas in the bases of China Eastern Airlines and China Southern Airlines has been completed. The western control tower has been capped; air control facilities are being deployed, and the aviation fuel pipeline will soon be connected. Thus, the building of the airport has entered the home stretch. 

The airport conducted its first test flight on Jan. 22 and completed all flight checks on Feb. 24, 19 days earlier than expected. We are shifting our focus from construction to preparing for its opening. We aim to finish all the construction work by June 30 and put it into operation by Sept. 30. Related departments are exerting every effort to achieve this schedule. 

Your question pertains to the functions and positions of the two airports. Some time ago, the Civil Aviation Administration of China issued a document defining the positions of the two airports. 

Beijing Daxing International Airport is positioned as a large international aviation and transportation hub in the Beijing-Tianjin-Hebei region to bolster the construction of the Xiongan New Area and serve as the new engine of national development. Largely relying on the bases of China Eastern Airlines and China Southern Airlines, the new airport will build a well-functioning airline network. The airport will be able to handle 45 million passengers by 2021 and 72 million passengers by 2025.

Beijing Capital International Airport is also positioned as a large international aviation hub, and as a complex hub in the Asia-Pacific region, supporting the core functions of the capital. Serving as the base for Air China, Beijing Capital International Airport will restructure its flight routes, strengthen its transit capacity and increase its international competitiveness. The airport has set out goals for 2020 and 2025 to boost its capacity and services. 

The two airports will coordinate and compete with each other to move toward the goal of building themselves into "double hubs" and help form a world-class airport cluster in the Beijing-Tianjin-Hebei region. Thank you.

Hu Kaihong:

Given our tight schedule, we will now take the final question.

Workers' Daily:

My question is, what has the transportation industry done to support the Yangtze River Economic Belt strategy, and what is the work plan for the next stage? Thanks.

Liu Xiaoming:

Let me take the question from Workers' Daily. The Ministry of Transport carefully studied and implemented the spirit of the important speech of General Secretary Xi Jinping of the Communist Party of China Central Committee last year, and we highlighted key tasks and made significant achievements related to the Yangtze River Economic Belt comprehensive transportation corridor construction. First, the development of green transport was deepened, and the emissions control zone was expanded to include key coastal waters and the main line of the Yangtze River. A total of 1,361 illegal ports along the Yangtze River were renovated, while 556 cases of illegal sand excavation were cracked.

Second, the functions of the golden waterway have been further improved. The 12.5-meter deep channel of the Yangtze River downstream from Nanjing, Jiangsu province, was finished half a year in advance, and was put into trial operation. The northeast channel and the second stage of the Anqing project, along with other key projects, were completed. Meanwhile, several projects were begun, including the 6-meter deep channel from Wuhan to Anqing, the first stage of Yangtze River southern delta flume channel renovation, the Yangtze River-Huaihe River water transfer shipping project, and the Hangzhou section of the Beijing-Hangzhou Canal. The channel network is gradually taking shape, with increasingly more branch channels being linked to the main channels.

Third, comprehensive transportation infrastructure recorded remarkable achievements. The Hangzhou-Ruili high-speed road was opened to traffic. A total of 13,700 kilometers of rural roads in the middle and upper regions of the Yangtze River were built or renovated. About 2,500 more villages were connected by roads. The construction of the Chengdu-Chongqing-Shanghai high-speed railway along the Yangtze River has been planned, and preliminary work has started simultaneously in different sections. Airport projects in Yueyang, Hunan province, and Bazhou, Sichuan province, were finished and opened for use.

Fourth, the organization of transportation is continually being optimized. The first 20,000-ton Yangtze River-sea bulk cargo ship, a 1,140-container river-sea ship and a 124-container river-sea ship were all put into service.

The ministry will continue to extend ecological preservation through intensive and economical utilization of shoreline resources, as well as standardization of ship type and promotion of clean energy, all under the concept of "joint protection, no excessive development." The ministry will actively deploy the Central Economic Work Conference and carry out its work plan regarding the construction of a comprehensive transportation system in the Yangtze River Economic Belt. According to the requirements of integrated design, works will highlight the respective advantages of railway, road and water transport, in order to form an efficient, intensive and green comprehensive transportation system.

The three key jobs now are as follows: First, we will continue to improve the Yangtze River golden waterway's functionality, and carry out a series of large-scale projects such as the 6-meter deep channel from Wuhan to Anqing, and advance work related to new channels of the Three Gorges hub. Second, we will advance the planning and construction of a high-speed railway along the Yangtze River, optimize and improve the regional road network, and advance the construction of a world-class airport cluster in the Yangtze River Delta. Finally, we will continuously optimize the management of transportation, strive to develop river-sea, main line-branch line and multimodal transportation, and carry out other related projects. Thank you.

Li Xiaopeng:

The Ministry of Transport has faithfully implemented the instructions given by General Secretary Xi on developing the Yangtze River Economic Belt and has carried out a series of projects in 2018, including golden watercourse construction, works on energy conservation, environmental protection, and ecological improvement, as well as adjustment of the transportation structure. And those works have seen some effective outcomes. In the next stage, we will, in line with the decisions and plans of the Party Central Committee and the State Council, focus on building an integrated, multidimensional transportation corridor, step up on advancing the golden watercourse, promote energy conservation and environmental protection, and boost efforts to adjust the transport structure, so as to make the Yangtze River an energy-saving and environmentally friendly golden watercourse. Thank you.

Hu Kaihong:

That's all for today's press conference. Thank you, Mr. Li and Mr. Liu. And thanks to everyone here today.

.

Read in Chinese

Speakers:

Han Changfu, deputy head of the Central Rural Work Leading Group, director of the Office of the Central Rural Work Leading Group, and minister of agriculture and rural affairs

Wu Hongyao, a member of the CPC Leading Group of the Ministry of Agriculture and Rural Affairs and director of the Secretariat of the Office of the Central Rural Work Leading Group

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office of China

Date:

Feb. 20, 2019

Hu Kaihong:

Ladies and gentlemen, good afternoon. Welcome to this press conference. This year's "No. 1 Central Document" entitled "Several Opinions of the CPC Central Committee and the State Council on Prioritizing the Development of Agriculture and Rural Areas to Address the Issues Relating to Agriculture, Rural Areas and Rural People" was released yesterday. Today, we are delighted to welcome Mr. Han Changfu, deputy head of the Central Rural Work Leading Group, director of the Office of the Central Rural Work Leading Group, and minister of agriculture and rural affairs, to introduce this document and answer your questions. We also have with us Mr. Wu Hongyao, a member of the CPC Leading Group of the Ministry of Agriculture and Rural Affairs and director of the Secretariat of the Office of the Central Rural Work Leading Group. Now, I'll give the floor to Mr. Han.

Han Changfu:

Ladies and Gentlemen, and friends from the press, good afternoon! Yesterday was the start of the "Rain Water" period, one of the 24 divisions of the solar year in the traditional Chinese calendar. 

This was also the day when Xinhua News Agency released the "No.1 Central Document" of 2019, entitled "Several Opinions of the CPC Central Committee and the State Council on Prioritizing the Development of Agriculture and Rural Areas to Address the Issues Relating to Agriculture, Rural Areas and Rural People." Now, I would like to give you a briefing about it.

The CPC Central Committee with President Xi Jinping at its core has always been highly committed to the work on agriculture, the rural areas and rural people (known in Chinese under the name of "San Nong" work), and given top priority to these aspects in the Party agenda. 

Last September, President Xi delivered an important instruction on advancing the "San Nong" work in 2019 and 2020 and on the drafting of the "No.1 Central Document" for this year. He stressed the importance to the master plan covering tasks essential to the building of a moderately prosperous society in all respects. 

Late last year, President Xi also issued an important written instruction to the Central Rural Work Conference. He acknowledged the achievements made in agricultural and rural development in 2018, highlighted the deep significance of the "San Nong" work, and identified the priorities forming the focus for 2019. His instruction set the tone and provided guidance for drafting the 2019 "No.1 Central Document" and the related work in 2019 and 2020. Premier Li Keqiang has also issued clear requirements for its successful performance.

In 2018, China recorded new achievements in agriculture and rural development, took firm steps to further advance poverty alleviation, and got off to a good start in implementing the Rural Revitalization Strategy.

Once again it was a bumper harvest year. Grain output reached 657.9 million tons, registering the seventh straight year above the 600 million ton-level. Sufficient supply of other important produce, including meat, eggs, milk, fruits, vegetables and fish, was also achieved

Farmers saw a steady income rise. The per capita annual disposable income of the rural population was 14,617 yuan, a gain of 6.6 percent in real terms after allowing for the price factor. This represented a higher growth rate than that achieved by the urban population.

Rural development took on a new look. The Three-Year Action Plan for Improving the Rural Living Environment is underway, and the first Chinese Farmers' Harvest Festival was successfully held.

All in all, there was steady progress in agriculture and rural development, delivering staunch support to the overall goal of sustainable and sound socioeconomic growth.

The year 2019 marks the 70th anniversary of the founding of the People's Republic of China. It is a critical year to achieve the First Centenary Goal of securing a decisive victory in building a moderately prosperous society in all respects, and a historic juncture in finally winning battle of poverty alleviation and rolling out the Rural Revitalization Strategy. So, it is of particular significance to do well in the work related to agriculture, rural areas and farmers.

Amid an increase in downward economic pressures, and faced with a rapidly changing external environment and growing risks and challenges, we must hold firm to the strategic status of agriculture, the rural areas in general, and farmers, and enable all three to play a strong stabilizing role for further growth.

However, agriculture and the countryside in general still pose a daunting and demanding challenge in the drive to make China a moderately prosperous society in all respects. Efforts and resources must be pooled to make breakthroughs that ensure the commitments on rural reform and development goals are met. We also need to take preemptive actions to address risks and challenges, so as to lay the foundation for sustained, healthy economic growth and social stability, and realize the First Centenary Goal as planned.

Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the "No. 1 Central Document" follows through on decisions made by the 19th National Congress of the CPC, the second and third plenary sessions of the 19th CPC Central Committee, and the annual Central Economic Work Conference. It focuses on the rural revitalization strategy, identifies a must-do list in regard to the work on agriculture, the rural areas and rural people to achieve a moderately prosperous society in all respects, and also puts forward new requirements for rural reform and development reflecting the evolving situation at home and abroad. 

The "No. 1 Central Document" is designed as a master plan on how to do well in regard to the work on agriculture, the rural areas and rural people, addressing priorities, weakness and essential points. This overall arrangement can be summarized in six aspects. 

First, underlining the need for pursuing progress while ensuring stability. 

For ensuring a stable market and sufficient supply, it seeks to strengthen the various policies and measures for developing agriculture especially grain production, and clearly specifies ways to stabilize the grain acreage and overall output. For achieving stable employment and increased farmers' income, it stresses the need to support rural industry, tap the employment potential of rural areas, and create more opportunities for rural residents to continue to work locally. For ensuring continued social stability and harmony, it emphasizes the need to increase welfare provisions for rural people, and strive to foster a healthy atmosphere of integrity, harmony and stability in the countryside.

Second, prioritizing implementation of the rural revitalization strategy. 

Based on the timetable, roadmap and assignment book forming the backbone of the strategy, the document determines the annual and phased measures in implementing it in 2019, so as to promote fresh progress continuing in each succeeding year and increase the sense of happiness and gains for the rural population.

Third, emphasizing the accomplishment of critical tasks. 

It once again underlines and sets priorities for winning the battle against poverty, ensuring food security and improving the rural living environment. In this regard, it details the measures and enhances accountability guiding all the efforts, investment and policy implementation to focus on must-do tasks to ensure all are completed on schedule.

Fourth, it highlights agricultural supply-side structural reform. In light of the guideline of consolidation, enhancement, improvement and unblocking, it lays out a clear plan for adjusting and optimizing the overall agricultural structure, developing rural specialty industries and promoting integrated development of the primary, second and tertiary industries. There is a strong focus on promoting reform in regard to supply-side agricultural restructuring for further advancement and deeper penetration.

Fifth, it highlights the critical role of rural Party branches. The Document underlines the need for further development and enhancement of rural community organizations across the board, and sets out the overall requirements, key tasks and safeguard measures for building strong and reliable community-level Party organizations throughout the rural areas.

Sixth, it highlights the policy orientation of prioritizing agricultural and rural development. It specifies in detail the institutional arrangement of a five-level Party secretary accountability system for rural revitalization, and stresses that implementation of the "four priorities" is of paramount importance and closely related to government performance evaluation. Finally, it further reinforces policy support. 

To sum up, this year's No.1 Central Document is a master plan essential to the task of building a moderately prosperous society in all respects and to the completion of the poverty alleviation work and implementation of the Rural Revitalization Strategy, enabling us to get off to a good start with rural reform in a new era after 40 years of reform and opening up. The No.1 Central Document features policies that are forward-looking, targeted and provide better guidance and we should fully carry it out.

The initiative of strengthening and empowering agriculture and rural areas was launched in 2019. We will resolutely implement policies concerning work related to agriculture, rural areas and farmers decided by the CPC Central Committee, and roll up our sleeves to work harder. We will make every endeavor to do well in work related to agriculture, rural areas and farmers, and maintain an encouraging momentum as paying tribute to the 70th anniversary of the founding of the People's Republic China with outstanding achievements.

Thanks for listening to my briefing. Now, I would like to take questions from the press together with my colleague Mr. Wu Hongyao, Director of the Secretariat of the Office of the Central Rural Work Leading Group.

Hu Kaihong:

Thanks to Mr. Han for his introduction. Now, the floor is open to questions. Please identify your media organization before asking questions.

CCTV:

As just mentioned, this year's "No. 1 Central Document" focuses on the implementation of tough tasks. Can you introduce what tough tasks mean and to what they specifically refer? Thank you.

Han Changfu:

This is a good question going to the heart of the document. By 2020, we will achieve our first centenary goal and complete the building of a moderately prosperous society in all respects. These are solemn commitments made by our Party to the entire population, and are tough tasks that we must accomplish within that timeframe as well. Therefore, this year's "No. 1 Central Document" focuses on the arrangements for handling these tough tasks.

In detail, the first tough task is to win the battle against poverty, which is the most important and urgent task in building a moderately prosperous society in all respects. In this year's document, it occupies a very prominent position. We should focus on solving existing gaps in providing adequate food and clothing for poverty-stricken people and ensuring their access to compulsory education, basic medical services and housing. Secondly, we need to step up efforts to lift people out of poverty in areas suffering from this in a deep-rooted way, which is a very tough nut to crack. Thirdly, we are determined to prevent people from falling back into poverty, and connect our poverty alleviation work with the revitalization of rural areas. It is of the greatest importance to alleviate poverty through promoting industrial growth that can provide job opportunities and broaden the available channels for increased levels of income, and also directly and effectively link the poverty alleviation work with rural revitalization. Thus, promoting industrial growth in the countryside is an important measure in overall poverty alleviation.

Second, we will further promote grain production. This is always a top priority and the primary task in regard to agriculture and rural affairs. Sufficient food supply may serve as the ballast stone to cope with mounting economic downward pressure and increasing uncertainties and risks. This year's "No. 1 Central Document" specially emphasizes strengthening agriculture and promoting food production. The detailed requirements include maintaining the policies and measures that support grain production, ensuring a sown area of 1.65 billion mu (110 million hectares) for grain, and so maintaining stable grain output. We must ensure China's arable land area remains above the red line of 1.8 billion mu. We need to comprehensively implement the policies providing special protection for the designated permanent basic cropland, and continuously increase the grain production capacity. Moreover, the document stresses the goal of developing 800 million mu of high-standard farmland. This means that grain production continues to be regarded as a tough task.

Third, we will increase the income of farmers. By 2020, the annual per capita income of rural residents must be double that of 2010. That is one of the indexes signaling completion of the work for building a moderately prosperous society in all respects. In recent years, the income of rural residents has been growing rapidly, and actually at a faster rate than that of urban residents for nine consecutive years. We must keep the trend of increasing income for rural residents in the coming two years. The document lays out detailed arrangements to foster the development of rural industries and diversify channels to increase the income of farmers. 

Fourth, we will improve rural living environment. This is one of the key tasks during implementation of the rural vitalization strategy. We will do a good job in carrying out the Three-Year Action Plan for Improving Rural Living Environment so that the rural living environment can be markedly improved by the end of 2020. In this regard, we will thoroughly learn from Zhejiang that has done a good job in its village environment demonstration and improvement initiative. This focuses on waste and sewage treatment, a toilet revolution and a village facelift. Since villages across China differ in many ways, our efforts will proceed from reality and adapt to local conditions, and our guidance should be differentiated. We also have to carry out the task gradually and don't go beyond our abilities. We will ensure our efforts not only match the level of local economic development, but are also in line with local culture and customs. 

Fifth, it is necessary to shore up the weakness in rural infrastructure and public services. Backward infrastructure and public services constitute the most visible sign of the urban-rural gap, and also one of the livelihood issues about which rural people most strongly complain. Therefore, in order to improve lives in the countryside, we should address the weakness as soon as possible. To this end, the document includes a village infrastructure development project expected to improve infrastructure in areas like drinking water, roads, power supply, housing, logistics and a modern information network. We will provide better public services such as education, medical care, sanitation, social security, culture and sport. We will strengthen pollution treatment and ecological conservation and promote green agricultural and rural development with a view to making China's villages highly livable, with picturesque scenery, blue skies and green spaces.

We also have tough tasks in other aspects that require more awareness of deadlines, better planning and coordination, detailed measures, and a strictly-observed accountability system for people at different levels, to ensure fulfillment on time and with the desired results. 

I should say there are many tasks concerning agriculture, rural areas and rural people, but these are the critical ones. In light of China's goal to complete the building of a moderately prosperous society in all respects, poverty alleviation is the most important element. It must be fully accomplished on time and with the desired results. Food security is our primary task, and we will guard the bottom line of keeping grain production from falling. The rural vitalization strategy is the overarching scheme under which we will keep on going in an all-round way with unremitting efforts. I think these are all things we will do vigorously and fulfill comprehensively this year and next. Thank you.

China News Agency:

I have two questions. First, more than a year has passed since the Rural Revitalization Strategy was rolled out. Can you elaborate on what progress has been made, what problems have been encountered in the implementation process, and how will you complete the key tasks in the start-up period? Second, for 16 consecutive years in the new century, the CPC central committee has focused on the issue of the work related to agriculture, the rural areas and the farmers in its No. 1 Central Document. Why should the central government continue to focus on this issue? What is the significance? Thank you.

Han Changfu:

The Rural Revitalization Strategy was a major strategy proposed at the 19th CPC National Congress, and was approved for inclusion in the Party Constitution. Over the past year, all localities have conscientiously implemented the central government's decision-making and arrangements in this regard, and worked hard to promote implementation with carefully-organized plans. Local governments have studied and formulated policy opinions for such implementation, and introduced their own plans accordingly. As we all know, in the second half of last year, the National Rural Revitalization Strategic Plan was released. In September, there was also a press release issued in this very place, detailing how all localities basically had formulated their supporting plans. It should be said that the mainframe for the implementation of the Rural Revitalization Strategy is basically established, and the timetable and tasks for promoting the strategy made clear. At the same time, in regard to the key areas and the key links, both central and local governments have developed a number of implementation plans, and set up a number of major projects and actions. Fresh progress has been made in such tasks as the development of rural industries and the renovation of human settlements. It can be said that the implementation of the Rural Revitalization Strategy has made a good start.

However, in regard to what you have asked, there are a number of problems still to be addressed. The development of agriculture and rural areas is obviously insufficient and imbalanced, and we need to address certain difficulties and problems during implementation of the rural vitalization strategy .

For example, cities and counties need to attach greater importance to rural vitalization, while the shortage of people, land and money should be fundamentally resolved. At the same time, while improving local infrastructure and people's livelihood, rural areas are incurring increasing debt. More to the point, a certain number of farmers remain less motivated.

Our next step must focus on the key tasks of implementing the rural vitalization strategy, ensuring they are better supported with resources and institutions. A great many measures have been specified in this year's "No. 1 Central Document" and the country's plan on its rural vitalization strategy issued last year. So far as I am concerned, there are four key aspects. First, we should carefully study President Xi's important remarks regarding agriculture, rural areas and rural people, with the theories as a guideline for us to implement the rural vitalization strategy in a concerted way.

Second, we will enhance the institutional support to ensure the five-level Party secretaries have their duties closely aligned with rural vitalization. Taking clear cut responsibilities, all officials involved will be evaluated, and the results of the evaluation will have a big say in deciding the overall level of official performance.

Third, we should follow the policies prioritizing development of agriculture and rural areas. We need to improve our top-level design, creating preferential policies for rural development and prioritizing the demand for competent officials, resources, funds and public services to address the shortage of people, land and money. Rural vitalization requires both strenuous efforts and great financial support.

Fourth, we should create a sufficient pool of talents dedicated to rural vitalization. Priority should be given to human resource development in rural areas, making headway in bringing talented minds together with technical and administrative support, at the same time, establishing teams constituting those expert in agriculture and passionate about rural areas and rural people.

The aforementioned are highlighted as our assignments in the next stage.

As to the second question, the "No. 1 Central Document" has focused on the work related to agriculture, rural areas and farmers for the 16th consecutive year. I think this sends out two messages. First, the CPC Central Committee has been attaching great importance to the work and showing great care for rural people, prioritizing the work on its agenda. Second, this year and the next form a decisive period for completing the building of a moderately prosperous society in all respects, and quite a few tough tasks must be fulfilled on regard to our work, especially issues relating to the poor regions. So, this year's "No. 1 Central Document" is of particular significance for the building of a moderately prosperous society in all respects and the achievement of the First Centenary Goal. Thank you.

Reuters:

I have two questions. First, the market is concerned about the plan to boost soybean planting and output mentioned in the "No.1 Document". Would you please detail this plan, for example, the targets of increasing soybean planting area and output? My second question is about the Sino-U.S. trade war. Since its inception, China has approved grain imports from new exporters. Will this diversification of imports continue after the Sino-U.S. negotiations are completed?

Han Changfu:

In regard to this question about soybean production and trade, I'd like to give the floor to Director Wu Hongyao.

Wu Hongyao:

The plan to boost soybean planting and output is an important measure to readjust agricultural supply-side structural reform, in particular the planting industry. We will enhance our efforts in following areas: first, to shore up the soybean planting area, and encourage farmers mainly in Northeast China and the North China Plain to get involved. Second, to accelerate scientific research into the development and selection of high-quality and high-yield varieties to tackle the key issues of improving soybean adaptability, output and quality. Third, to cultivate some new soybean production companies and new cooperative organizations through collaboration with the further development of the processing industry, and to deepen specialization in the soybean production and trade. The plan will mainly provide support in regard to technologies, structure and policy.

As to your second question about the soybean trade, China is a major importer of American soybeans, with the latter occupying about one-third of its total imports. The volume fell last year as a result of the trade friction. As was mentioned, China consumes around 110 million tons of soybeans each year, while its annual production is only 16 million tons. This means about 90% of its soybean needs rely on imports. We will open wider to the world, including increasing the openness of the agricultural sector to make good use of both domestic and foreign markets and resources. China's soybean market will remain open. We will allow the market and businesses get involved to decide the source of imports, and follow the general rules of economics. Our market is also open to the U.S.

Han Changfu:

I would like to add three points. First, China is a soybean producer with its own features and strengths. So, we will appropriately develop our own soybean industry based on our resource advantages and consumer needs. Second, China's reliance on soybean imports will remain despite the development of its own soybean production. As Mr. Wu has mentioned, China produces about 16 million tons of soybeans each year, but annual consumption amounts to 110 million tons, creating an import demand of around 90 million tons. Third, we will continue our soybean trade with other countries and diversify the sources of soybean imports. I believe China and the U.S. will continue to be important soybean trading partners. Thank you.

Farmers' Daily:

The No.1 Document of 2019 is entitled "Prioritizing the Development of Agriculture and Rural areas to Address the Issues Relating to Agriculture, Rural Areas and Rural People". And one of the six characteristics mentioned in Mr. Han's introduction highlights the policy orientation of prioritizing agricultural and rural development. Are there any specific requirements with regard to this aspect? Thanks.

Han Changfu:

The proposition of prioritizing agricultural and rural development is raised to meet the needs of overall development of the Party and the country, as well as to address the development gap between urban and rural areas, where inadequate development is apparent. It is a major policy that needs to be upheld for long-term. Hence, the Document puts forward requirements to master the policy orientation. As you have noted, the document is entitled "Several Opinions on Prioritizing the Development of Agriculture and Rural areas to Address the Issues Relating to Agriculture, Rural Areas and Rural People". Specifically, it emphasizes the "four priorities" put forward by President Xi Jinping.

First, priority in building a team of outstanding cadres. The excellent officials should be put on the front of the work related to agriculture, rural development and farmers' wellbeing, also known as "San Nong" work. Talented ones should work in the front line, while cadres who are familiar with the "San Nong" work over a long period should be included in local leadership development. We need to improve the system of training and managing cadres, in a bid to build a core team with deep knowledge of agriculture, and love for the rural areas and rural people.

Second, priority must be given to optimizing factors allocation. We need to break down barriers harmful to the population flow between urban and rural areas, and an equal exchange system. We should reverse the one-way flow of resources allocation. All kinds of factors, including land, talents, funding, technology and science should be led to flow into agriculture and rural areas, enabling them to give full play to their potential and vitality.

Third, priority has to be given to ensuring investment. We need to make sure that agriculture and rural areas are two priority aspects in fiscal and financial support. Efforts should be made to facilitate access to publicly-funded support, and to ensure that more revenues from sales of land rights are invested in agriculture and rural areas. In the past, we often took money from the rural areas to be used in urban areas. In future, emphasis should be given to investment and efforts focused on agriculture and rural areas.

Fourth, priority must be given to public services. We need to unify the standards and systems of basic public services provided in urban and rural areas. This means we should ensure that there is true fairness in this regard, so that the rural population can have access to public services at the same level as those in the urban areas. 

Opinions on prioritizing the Development of Agriculture and Rural areas should be fully implemented in the "San Nong" work. We need to take the responsibilities of rural revitalization and "four priorities" on our shoulders and regard "San Nong" work as outstanding achievements in an official career. The implementation of the policies on modernization of agriculture and rural areas, as well as the "four priorities" should be made to ensure the "San Nong" work is fully guaranteed. Thanks.

China Daily:

This year marks the beginning of a new round of reform of rural affairs. And the land reform is a highlight of it. What are the key points and direction of the land reform in the future? 

Han Changfu:

This year does indeed mark the start of a new round of reform of rural affairs. The No. 1 Central Document has arranged for its implementation. Handling relations between farmers and land remains the mainline of deepening rural reform. The land institutional reform should be used as a pivot to advance the rural reform. Generally speaking, the most important aspects are as follows.

First, the land contract relations should be stable and long-lasting. We should properly complete the land contract confirmation and registrations, grant the land contract certificates, and appropriately handle and resolve historical problems to place the land contract certificates in farmers' hands. Farmers' minds will be put to rest once these undisputable certificates are awarded. This work has been ongoing for five years since the 18th National Congress of the Communist Party of China, and is nearly completed. We should accomplish the finishing touches this year. Meanwhile, research is underway to roll out supporting policies to extend the land contract rights for another 30 years after the second round of land contracts expires, which President Xi Jinping, also general secretary of the CPC Central Committee, announced in his report to the Party's 19th National Congress. We must act according to the central authority's requirements, and formulate supporting policies so as to ensure the new policies align with the old ones, achieving a smooth transition.

Second, we will continue to deepen rural land reforms in three aspects: land acquisition, market entrance of collectively-owned commercial land, and homestead institutional reform. The reform has been piloted for four years. We will review the sum of the pilot experience, and consolidate and expand reform achievements. As for those that have been successfully piloted, for instance the rural land appropriation and the market entrance of collectively-owned commercial construction land, we will improve the supporting policies after relevant laws are amended and promote the reform nationwide, in order to expedite the formation of a unified urban and rural construction land market.

We will continue to advance the reforms prudently, expand pilot reforms and enrich some reforms that have proven immature, such as the homestead institutional reform. For instance, we must explore effective ways to loosen control over rights to homestead and farmers' houses, so as to make better use of the homesteads and farmers' houses that have been left unused, thus attempting to increase farmers' income. We need to find methods to make that happen, as it is said there are many "hollow villages" with large numbers of unused homesteads and empty houses. Before that, we need to do some groundwork, for instance, organize investigation of homesteads and farmers' houses in these village to assess the basic information nationwide. We strive to finish this important work — the confirmation, registration and certification of usage rights for homesteads in village — by 2020.

Third, we must create new modes of business operations. We need to improve the legal, regulatory and policy systems to ensure the separation of the "three rights" regarding contracted land, and to cultivate two types of new agricultural business entities — the family farm and farmers' cooperative. We need to put policies in place to help the development of small farming households, to foster various kinds of social service organizations and to enhance the efficiency and improve the level of agricultural operations. 

Of course, there are other tasks to be completed in the institutional reform of rural land. This reform is a sizeable process, so it must be advanced steadily and prudently. The No. 1 Central Document also stresses that the reform must defend the baseline, which means the rural land, which is collectively owned, should not be privatized; rural land should always be used for agriculture and farmers' interests, rather than for non-agricultural purposes; farmers' rights and interests over their land must be guaranteed, and giving up their contracted land and homesteads should not be made conditions for their becoming urban citizens. These baselines must be held. In brief, the new round of rural reform should be advanced with the deepening of land institutional reform, which can further release village's vitality. Thank you.

Phoenix:

We note that the document proposes to promote standardized operation of the transfer of various rural property rights. What specific measures will the Ministry of Agriculture and Rural Affairs take in 2019? Thank you.

Han Changfu:

Reform of the rural property rights system is an important part of overall rural reform, which requires us to fulfill two tasks. First, that means making an inventory of assets, or, in other words, figuring out how many collective assets there are, including operational assets and non-operational ones. This work should be basically finished by the end of this year. The second aspect is pushing forward the pilot reform of the joint-stock cooperative system and establishing joint-stock cooperative organizations in rural areas. We need to figure out who owns these assets and how to manage and operate them, and establish a set of effective mechanisms featuring clear property rights and ownership. Th pilot reform program is expanding currently with a growing number of counties and cities across the country engaged. The reform also involves many policy-related factors. Now, urbanization and industrialization are accelerating, and a large number of farmers, namely members of collective economic organizations, are leaving the rural areas to work and carry on business, and even settle down in the cities. Great changes have taken place in rural areas, as well as among members of collective economic organizations. Therefore, the amount and ownership of collective assets has to be figured out. Moreover, the rural revitalization strategy is currently underway to increase farmers' income from property, and the reforms should also be promoted to revitalize rural resources. With the documents on the reform issued by the Central Committee, progress is being made in an orderly manner in fulfilling these two key tasks. We believe that, with gradual progress of reform, the vitality of rural areas will be further unleashed. Thank you.

Guangming Daily:

Rural governance is essential to the implementation of the rural revitalization strategy. Two parts of the five-point general requirement, namely social etiquette and civility and effective governance, are related to rural governance. My question is for Mr. Han. What policies does this year's "No.1 Central Document" offer to strengthen and improve rural governance? Thank you.

Han Changfu:

Thank you for your question. You are a very good learner. Effective governance is an important part of the five-point general requirement for rural revitalization. This is not only about boosting economic growth, but also promoting the all-round development of rural areas. Rural governance is critical to rural revitalization, as it concerns farmers' sense of happiness and security, law and order, as well as the foundation of Party's governance in rural areas. At present, there are still many problems in rural governance, especially at community-level. For example, in terms of social etiquette and civility, there has been a resurgence of bad marriage and funeral traditions, and a refusal to fulfill the requirements of filial piety; in some places, rural gangs are undermining farmers' sense of security and happiness; some community-level Party organizations in rural areas are weak, with lax discipline and being unqualified to serve and mobilize farmers; some farmers' self-governance organizations are also failing to play their due roles. Therefore, major policies have been formulated in this year's "No.1 Central Document" to improve the overall level of rural governance.

The first is to improve governance mechanisms in rural areas. We need to optimize the Party organization-led leadership institutions and working mechanisms that integrate self-governance, rule of law and rule of virtue, improve village-level consultation systems, and ensure that the people play the principal role in governance, so that rural areas can enjoy great vitality, harmony and good governance. Following the requirements made by the CPC Central Committee, we drafted policies to strengthen and improve rural governance to reinforce guidance in this key task.

The second is to strengthen the rural spiritual civilization construction. It is absolutely necessary to guard the rural ideological and cultural fronts, guide farmers to practice socialist core values, tap the excellent traditional culture of the countryside, refine rural concepts and customs through village rules and regulations, and replace old stereotypes with civilized rural customs.

The third is to build a peaceful village. It is necessary to further advance the special campaign against evils, resolutely investigating and dealing with harmful practices and corruption in rural areas, improve the mechanism for mediating and resolving disputes, and investigating and controlling hidden dangers to rural public security, so as to foster a healthy atmosphere of integrity, harmony and stability.

The fourth is to do a good job in building community-level Party organizations in rural areas. A solid foundation is the premise for future work. It is necessary to rectify resolutely any weakness and laxity in community-level Party organizations, select right leaders for them, strengthen and improve the leadership of the community-level Party organization for various organizations at village level, and strengthen the service functions. At the same time, it is very important to improve the funding mechanism for operation of village-level organizations, which is a key policy highlighted in the document. It is necessary to develop and strengthen the collective economy according to local conditions. Through these measures, we can give play to the critical role of rural Party branches, and improve rural governance capabilities and the supporting systems. It should be said that such tasks are still very arduous. Implementing the document can ensure that rural governance plays a key role in rural revitalization. Thank you.

CRI:

At the end of last year, the central economic work conference put forward the principles for supply-side structural reform. Are there any important measures in the No. 1 Central Document concerning supply-side structural reform in the agricultural sector? Thank you.

Han Changfu:

In order to deepen supply-side structural reform in general and also in the agricultural sector, the central economic work conference set the following principles: Previous structural adjustments for cutting overcapacity, reducing excess inventory, deleveraging, lowering costs, and strengthening areas of weakness, should all be reinforced; micro market entities will be further motivated and energized; the levels of industrial chains will be improved; and the national economic cycle should be further facilitated. In the past two years, there was remarkable progress in supply-side structural reform in the agricultural sector. The mismatch between the supply and demand of agricultural products has improved substantially. For example, major progress can be seen in the reduction of the corn inventory, there has been a significant increase in green development and product quality. However, the main problem in agriculture still remains on the supply side, requiring further reform efforts. The No. 1 Central Document stresses the abovementioned principles. We must stick to the supply-side structural reform in line with the principles of promoting greener agriculture with better quality, and improve the branding of agricultural products as well as their uniqueness and specialty. We intend to deepen supply-side structural reform in greater detail so as to further promote high-quality agricultural development.

First, we will continue to improve various aspects of the agricultural structure. We will reinforce the corn structural adjustment by reducing excess inventory, lowering costs and strengthening areas of weakness. We will maintain a well-balanced pace of work to reduce the corn inventory, step up our efforts in reducing the rice stockpile, implement the plan to boost soybean planting and output, increase the supply of rare, green and quality agricultural products, adjust the product mix of basic food, cash, and fodder crops, raise the quality and performance of the livestock industry and promote the transformation and upgrading of the fisheries sector. 

Second, we will make efforts to advance green development by promoting green and recycling production modes and launching campaigns to reduce use of fertilizers and pesticides. Last year, China achieved negative growth in use of both fertilizers and pesticides. We will continue to seek advances in this regard. Moreover, we will promote the recycling of agricultural waste. And we will also expand trials in using systems of crop rotation and fallow land. 

Third, we will take strong measures to facilitate standardized production, brand building, and closer supervision of food safety. We will work to ensure the quality and safety of agricultural products and improve the supervisory mechanism, monitoring and traceability systems. In this way, we can promote an agricultural development pattern where the superior will be selected and the inferior eliminated, and the quality and branding will propel and bolster agricultural growth.

These are the major measures we will undertake to adjust the agricultural structure. We believe that, with stable total output and improving structure, the agricultural sector can achieve better quality, performance and greater competitiveness. Thank you.

China Co-operation Times:

The No.1 Central Document stresses the regulation of farmers' cooperatives and puts forward the establishment of a system to improve and support the development of farmers' cooperatives. Progress on developing cooperation among production, supply and marketing and credit cooperatives has been achieved in Zhejiang province. So, what's the next step in promoting such cooperation? And what kind of policies will be taken to support the development and regulation of farmers' cooperatives? Thanks.

Wu Hongyao:

To foster new types of agribusiness, we place importance on two aspects: farmers' cooperatives and family farms. The No.1 Central Document covers both, with stepped-up efforts to develop family farms, while regulating the development of farmers' cooperatives.

Farmers' cooperatives have achieved great progress and played a vital role in the economy. However, problems are emerging at the same time. According to the No.1 Central Document, farmers' cooperatives will pursue further development, while seeking to improve their regulation, so as to address such issues as "zombie cooperatives."

The supply and marketing cooperatives in Zhejiang province you mentioned form an important part in the farmers' cooperative movement, and development of the cooperative economy, which is highly valued by the CPC Central Committee and the State Council. The central leadership has released opinions on deepening reform on supply and marketing cooperatives, now being implemented across the country. The complex cooperatives (including production cooperatives, supply and marketing cooperatives, as well as credit cooperatives) in Zhejiang province started quite early and have made positive progress. The complex cooperatives can be seen as a new direction nationwide. Exploration on how to develop them further is underway in different places. Besides the cooperatives in Zhejiang province, Shandong province is placing farmland under trusteeship, which is also an effective way forward.

To develop supply and marketing cooperatives, first, we need to focus on strengthening primary branches and guide them to focus on their original functions, inviting more individual farmers to participate. Second, we need to expand the business scope. The credit cooperatives can also be developed to promote cooperation on distribution and processing of agricultural products.

In a word, the development of cooperatives needs both support and regulation in order to give full play to their role in future. Thanks.

Han Changfu:

I agree with what Mr. Wu Hongyao has said in regard to your question. However, there is still one further point I would like to share with you. We have an important policy orientation to support and direct the development of farmers' cooperatives during the reform and revitalization of our countryside. We are a country where smallholder farming is in the majority, and if we want to have a market-based agriculture, we need to group smallholders together for them to venture in the market. Besides, modern agriculture needs to achieve economies of scale and this also makes it necessary for farmers to stick together and be well organized to achieve common prosperity. Therefore, our work in 2019 will also focus on the farmers' cooperatives in various forms, ensuring their sustainable development. Thank you.

Hu Kaihong:

That's all for today's press conference. Thank you, Mr. Han and Mr. Wu and thanks to everyone here today.

.

Read in Chinese

Speaker:
Ning Jizhe, head of the National Bureau of Statistics

Chairperson:
Hu Kaihong, spokesperson for the State Council Information Office of China

Date:
Jan. 21, 2019

   

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this press conference. Today, we are delighted to invite Mr. Ning Jizhe, head of the National Bureau of Statistics (NBS), to introduce China's economic performance in 2018, and answer your questions. Now, I'll give the floor to Mr. Ning.

Ning Jizhe:

Good morning, chairperson, friends from the press. In 2018, China's economy operated within a reasonable range and our main social and economic development targets were realized. This is because all localities and departments stuck to the overall tone of making progress while maintaining stability in their work. They embraced new development philosophies, sought high-quality development, and pressed ahead with supply-side structural reform. As a result, the supply-side structural reform has gone deeper, reform and opening-up efforts have been intensified, living standards have been improved, the economy has remained in a reasonable range and the trend of achieving progress while maintaining stability has continued. We are continuing to make progress toward building a moderately prosperous society.

According to preliminary calculations, China's GDP in 2018 hit 90.03 trillion yuan, up 6.6 percent from the previous year, realizing the goal of 6.5 percent growth. The four quarters saw growth rates of 6.8 percent, 6.7 percent, 6.5 percent, and 6.4 percent, respectively. The value added of industries were 6.47 trillion yuan, 36.60 trillion yuan, and 46.96 trillion for the primary, secondary and tertiary industries, respectively, with growth rates of 3.5 percent, 5.8 percent, and 7.6 percent.

1. Grain production enjoyed a high yield, and production of animal husbandry was generally stable.

Last year's total grain output was 657.89 million tons, down by 0.6 percent from the previous year. Regardless, this was still a year of bumper harvest and we've maintained an output of over 650 million tons for four consecutive years. The output of summer grain, early rice and autumn grain was 138.78 million tons, 28.59 million tons and 490.52 million tons respectively. The total output of cotton was 6.10 million tons, up by 7.8 percent from the previous year. The planting structure continues to improve as the land used to grow high-quality rice, soybeans, cotton, sugar crops and Chinese medicinal herbs increased, while the land allocated to maize growth decreased.

The total output of pork, beef, mutton and poultry was 85.17 million tons, down by 0.3 percent over last year. The total output of pork was 54.04 million tons, down by 0.9 percent; output of beef was 6.44 million tons, up by 1.5 percent; the output of mutton was 4.75 million tons, up by 0.8 percent; the output of poultry was 19.94 million tons, up by 0.6 percent. The number of live pigs was 428.17 million, down by 3 percent from the previous year; the amount of pigs slaughtered was 693.82 million, down by 1.2 percent.

2. Industrial production increased steadily, and new industries grew rapidly.

The value added of industrial enterprises with an annual revenue at or above 20 million yuan from their main operations increased by 6.2 percent in 2018 over the previous year, with a moderate and stable growth rate. In terms of different types of organizations, the value added of state-holding enterprises increased by 6.2 percent, that of collective enterprises decreased by 1.2 percent, that of joint-stock enterprises went up 6.6 percent, and that of enterprises with foreign, Hong Kong, Macao and Taiwan investors grew by 4.8 percent. In terms of different industries, the value added of mining increased 2.3 percent, that of manufacturing was up 6.5 percent, and that of producing and supplying electricity, heat, gas and water grew by 9.9 percent. The value added of high-tech manufacturing rose by 11.7 percent, strategic emerging industries by 8.9 percent and equipment manufacturing by 8.1 percent over the previous year, a growth 5.5, 2.7 and 1.9 percent faster, respectively, than of industrial enterprises over the designated revenue of 20 million yuan. The output of emerging industrial products increased rapidly, with passenger trains rising 183.0 percent, microwave terminals 104.5 percent, new energy vehicles 40.1 percent, bio-based chemical fibers 23.5 percent, smart televisions 18.7 percent, lithium-ion batteries 12.9 percent and integrated circuits by 9.7 percent. In December, the value added of industrial enterprises with an annual revenue of 20 million yuan or more from their main business operations increased by 5.7 percent year over year, 0.3 percentage point higher than the growth rate in November.

From January to November, the total profit of industrial enterprises with an annual revenue of 20 million yuan or more from their main business operations reached 6.1169 trillion yuan, up 11.8 percent year on year. The profit margin of this same subset of industrial enterprises was 6.48 percent, 0.16 percentage point higher than the same period last year.

3. The service sector maintained fast growth, and the business activity indexes remained within the range of expansion.

In 2018, the Index for Service Industry Production maintained rapid growth, increasing by 7.7 percent over the previous year. Among sectors, information transmission, software and information technology services, leasing and business services grew by 37.0 percent and 10.1 percent respectively. In December, the Index for Service Industry Production increased by 7.3 percent year over year, 0.1 percentage points higher than the previous month. From January to November, the business revenue of service enterprises above designated size increased by 11.5 percent year over year. In particular, the business revenue of strategic emerging services, science and technology and high-tech services increased by 14.9, 15.0 and 13.4 percent year over year, respectively. The operating profit of service enterprises above designated size increased by 5.7 percent.

In December, the Index for Service Industry Business Activity stood at 52.3 percent, which was within the expansion range. Specifically, the figures for railways, telecommunications, radio and satellite transmission services, monetary and financial services, insurance and other financial industries were all in a higher expansion range above 60.0 percent. In terms of market expectations, the Index for Service Industry Business Activity Expectation reached 60.2 percent, an increase of 0.6 percentage points over the previous month.

4. Market sales grew steadily and rapidly, and the proportion of online retail sales increased significantly.

The total annual retail sales of consumer goods reached 38.10 trillion yuan, an increase of 9 percent over the previous year, which reflects relatively rapid growth. Specifically, the retail sales of consumer goods by enterprises above the designated size stood at 14.53 trillion yuan, an increase of 5.7 percent. If we categorize them according to the business location, the retail sales in urban areas reached 32.56 trillion yuan, up 8.8 percent, while the retail sales in rural areas reached 5.54 trillion yuan, up 10.1 percent.

According to the type of consumption, catering income was 4.27 trillion yuan, an increase of 9.5 percent and the retail sales of goods were 33.83 trillion yuan, an increase of 8.9 percent. The upgraded consumption goods have seen relatively rapid growth. The growth rates of retail sales in three categories, namely of cosmetics, of household appliances and audio-visual equipment, and of communication equipment, were 3.9, 3.2 and 1.4 percentage points higher than the overall growth rate of retail sales of consumer goods by enterprises above the designated size. In December, total retail sales of consumer goods increased by 8.2 percent year over year, or 0.55 percent month-on-month.

The annual online retail sales nationwide reached 9.01 trillion yuan, an increase of 23.9 percent over the previous year. Specifically, the online retail sales of physical goods reached 7.02 trillion yuan, up 25.4 percent, accounting for 18.4 percent of the total retail sales of consumer goods, or 3.4 percentage points higher than the previous year; the online retail sales of non-physical goods were 1.99 trillion yuan, up 18.7 percent.

5. Investment growth overall slowed down and stabilized; however, investments in the manufacturing industry and private investment increased at a faster rate.

National fixed-asset investment (excluding rural households) totaled 63.5636 trillion yuan, up 5.9 percent year over year, or 0.5 percentage point higher than the growth rate achieved in the first three quarters. Private investment reached 39.4051 trillion yuan, an increase of 8.7 percent year over year and 2.7 percentage points higher than the same period of the previous year. In regard to specific industries, primary sector investment increased 12.9 percent, up 1.1 percentage points from the same period of previous year. Secondary industry investment rose 6.2 percent, or 3.0 percentage points higher, of which that by the manufacturing industry increased 9.5 percent, which was a gain of 4.7 percentage points. Tertiary industry investment rose 5.5 percent, including a 3.8 percent increase in infrastructure. Investment in high-tech manufacturing and equipment manufacturing increased 16.1 percent and 11.1 percent respectively on an annual basis, or 6.6 and 1.6 percentage points higher than the growth of overall manufacturing investment. In December, fixed asset investment increased by 0.42 percent from the previous month. Last year, total investment in real estate development was 12.0264 trillion yuan, up 9.5 percent year over year. The total floor space of commercial buildings sold was 1.71654 billion square meters, up 1.3 percent year over year, of that of residential buildings sold grew by 2.2 percent. The total sales of commercial buildings reached 14.9973 trillion yuan, up 12.2 percent year over year, including a 14.7-percent growth in sales of residential buildings.

6. Imports and exports reached a record high, with the structure of trade continuing to improve.

China's imports and exports last year reached 30.51 trillion yuan, up 9.7 percent year-on-year. This was the first time the figure exceeded 30 trillion yuan. Foreign trade maintained growth with structural optimization, ensuring a steady and sound momentum for both imports and exports to exceed expectations. Exports rose 7.1 percent year on year to 16.42 trillion yuan, while imports grew 12.9 percent to 14.09 trillion yuan. This produced a trade surplus of 2.33 trillion yuan, a drop of 18.3 percent from the previous year. General trade accounted for 57.8 percent of all activity, up 1.4 percentage points from the previous year. Electromechanical exports, constituting 58.8 percent of total exports, grew by 7.9 percent, or 0.4 percentage points higher than the previous year. Imports and exports with major trading partners, – including the European Union, the United States and the Association of Southeast Asian Nations (ASEAN) countries, achieved overall growth, the figures being 7.9 percent, 5.7 percent and 11.2 percent respectively. Trade with countries along the Belt and Road Initiative continued their upswing, growth reaching an aggregated 13.3 percent year-on-year, which was 3.6 percentage points higher than the improvement achieved in overall imports and exports. The export delivery value of industrial enterprises above designated scale reached 12.39 trillion yuan, up 8.5 percent year-on-year.

7. Consumer price saw a mild surge and the growth of industrial producer's price fell.

Annual consumer prices grew by 2.1 percent year over year, which reflects a mild increase, lower than the projected target of 3 percent. Within this category, urban consumer price increased 2.1 percent, and rural 2.1 percent. The price of food, tobacco and wine increased 1.9 percent, clothing 1.2 percent, residence 2.4 percent, articles of daily use and services 1.6 percent, traffic and communication 1.7 percent, education, culture and entertainment 2.2 percent, medical care 4.3 percent, and other articles for use and services 1.2 percent. Within the price of food, tobacco and wine, the price of grain rose 0.8 percent, pork fell 8.1 percent, and fresh vegetables went up 7.1 percent. The core CPI, with food and energy prices deducted, increased 1.9 percent, 0.3 percentage point lower than the previous year. In December, consumer prices increased by 1.9 percent year over year, the same as November's rate. The annual factory prices from industrial producers went up 3.5 percent year over year, down 2.8 percentage points from the previous year. The industrial producer factory price increased 0.9 percent year over year in December, 1.0 percent lower than that of November. The annual industrial producer purchase price increased 4.1 percent year over year; within that, in December the industrial producer purchase price rose by 1.6 percent year over year, or 0.9 percent lower than November's figure.

8. Employment remained stable and urban surveyed unemployment declined.

The number of new jobs was 13.61 million last year, 100,000 more than the previous year and 123.7 percent of the annual target. The number of annually increased jobs has remained above 13 million for six years consecutively. In December, the national urban surveyed unemployment rate was 4.9 percent, 0.1 percentage point lower than the same month of the previous year. Last year, the urban surveyed unemployment rate remained between 4.8 percent and 5.1 percent, realizing the target of keeping it below 5.5 percent. In December, the surveyed unemployment rate in 31 major cities was 4.7 percent, 0.2 percentage point lower than the same month of the previous year. The surveyed unemployment rate of the main employment population between 25 years old and 59 years old was 4.4 percent, remaining the same as the previous month. By the end of the year, the number of employed persons nationwide was 775.86 million, of which the urban employed population was 434.19 million. The number of migrant workers hit 288.36 million last year, 1.84 million more than the previous year, up 0.6 percent year over year. Of these, the number of migrant workers working at or near their hometowns was 115.7 million, up 0.9 percent, and the number of migrant workers working far from their hometowns was 172.66 million, up 0.5 percent. The average monthly income for migrant workers was 3,721 yuan, up 6.8 percent year over year.

9. The income and consumption expenditure of residents increased steadily, and growth in rural areas was faster than in urban ones.

In 2018, the nationwide per capita disposable income of residents was 28,228 yuan, a nominal growth of 8.7 percent over the previous year, or a real increase of 6.5 percent after deducting price factors, exceeding the growth of per capita GDP and essentially keeping up with economic growth. In terms of permanent residence, the per capita disposable income of urban households was 39,251 yuan, a nominal growth of 7.8 percent over the previous year, or a real growth of 5.6 percent after deducting price factors. The per capita disposable income of rural households was 14,617 yuan, a nominal growth of 8.8 percent over the previous year, or 6.6 percent in real terms after deducting price factors. The per capita income of urban households was 2.69 times that of rural households, 0.02 less than the previous year. The median of the nationwide per capita disposable income was 24,336 yuan, a nominal increase of 8.6 percent. Taking the per capita disposable income of nationwide households by income quintiles, that of the low-income group reached 6,440 yuan, the lower-middle-income group 14,361 yuan, the middle-income group 23,189 yuan, the upper-middle-income group 36,471 yuan, and the high-income group 70,640 yuan.

In 2018, the nationwide per capita consumption expenditure was 19,853 yuan, a nominal increase of 8.4 percent, 1.3 percentage points higher than the previous year, or a real increase of 6.2 percent after deducting price factors, 0.8 percentage point higher than the previous year. The per capita consumption expenditure of urban households was 26,112 yuan, a nominal growth of 6.8 percent, 0.9 percentage point more than the previous year. The per capita consumption expenditure of rural households was 12,124 yuan, a nominal increase of 10.7 percent, 2.6 percentage points more than the previous year.

10. Supply-side structural reform has gone deeper; and the trend of economic transformation and upgrading has continued.

2018 has seen substantive progress in fulfilling the five priority tasks of cutting overcapacity, reducing excess inventory, deleveraging, lowering costs, and strengthening points of weakness. In terms of cutting overcapacity, the tasks for iron, steel and coal were completed ahead of schedule. Nationally, the rate of industrial capacity utilization was 76.5 percent. The rate for ferrous metal melting and rolling was 78 percent and that for coal mining and washing was 70.6 percent, up 2.2 and 2.4 percentage points, respectively, from a year ago. In terms of deleveraging, the corporate asset-liability ratio went down. At the end of November, the ratio for industrial enterprises above the designated size was 56.8 percent, down 0.4 percentage point year over year. Among these enterprises, state-holding ones had a ratio of 59.1 percent, down by 1.6 percentage points. In terms of reducing excess inventory, China's housing for sale totaled 524.14 million square meters at the end of 2018, representing a fall of 11 percent. In terms of lowering cost, corporate costs continued to decline. From January to November, industrial enterprises above the designated size saw their costs fall by 0.21 yuan to 84.19 yuan for each one hundred yuan they made from their core businesses. In terms of strengthening points of weakness, investment in points of weakness saw fast expansion. Namely, investment in ecological protection and environmental improvement expanded by 43 percent and agricultural investment by 15.4 percent, up 37.1 and 9.5 percentage points respectively.

Economic structure continued to improve. The value added from the tertiary industry accounted for 52.2 percent of the GDP, up 0.3 percentage point year over year. This was 11.5 percentage points higher than contributions from the secondary industry, which increased by 0.1 percentage point to 59.7 percent. Consumption's role as a main driver for economic growth became stronger, with final consumption expenditure contributing 76.2 percent to GDP growth, up 18.6 percentage points year over year and 43.8 percent higher than the contribution of gross capital formation. Household consumption saw an advancement toward higher quality. The national Engel coefficient was 28.4 percent, down by 0.9 percentage point from last year. Of the total household consumption per capita, 44.2 percent was on services, up 1.6 percentage points year over year. Green development also made solid progress. Energy consumption per 10,000 yuan of GDP dropped by 3.1 percent, meeting the goal of falling by at least 3 percent. The proportions of energy consumption continued to improve. Clean energy, such as natural gas, hydropower, nuclear power and wind power, saw a higher ratio of total energy consumption, up by about 1.3 percentage points from the previous year.

11. China's population grew steadily, and the urbanization rate continued to rise.

By the end of 2018, the mainland population (including populations of 31 provinces, autonomous regions, municipalities directly under the central government, and PLA personnel, excluding populations of Hong Kong Special Administrative Region, Macao Special Administrative Region, Taiwan Province and overseas Chinese) stood at 1.39538 billion, an increase of 5.3 million from the year before. There were a total of 15.23 million births and 9.93 million deaths reported in 2018, and the birth and death rates reached 10.94 and 7.13 per 1,000, respectively. In terms of gender structure, there were 713.51 million males and 681.87 million females, putting a gender ratio at 104.64. The working-age population (people aged from 16 to 59) stood at 897.29 million, representing 64.3 percent of the total population. About 249.49 million people were registered as being 60 or older, accounting for 17.9 percent of the population; 166.58 million were 65 or older, or 11.9 percent of the population. There were 831.37 million urban residents, a 17.9 million increase from the previous year. The rural population fell 12.6 million to a total of 564.01 million. The urbanization rate was 59.58 percent, 1.06 percentage points higher than the previous year. About 286 million people resided places for over six months away from their places of residential registration, 4.5 million less than the previous year. Specifically, the floating population was 241 million, 3.78 million less than the previous year.

Generally speaking, the national economy in 2018 performed within a reasonable range. It maintained sound and steady growth. At the same time, we have noticed that there are still some changes in the economic operation that are a cause of some concern. We are also facing a complex and serious external environment, accompanied by downward pressure on overall economic growth. All such problems need to be resolved in a targeted manner. In 2019, we will continue to take advantage of the important period of strategic opportunities for development, adhere to the policy of making progress while pursuing stability, commit ourselves to the new development philosophy, seek high-quality development, and pursue supply-side structural reform as the main task. We will stimulate market vitality, demand potential and the driving force of growth, and take comprehensive steps to stabilize growth, facilitate reform, adjust various structures, improve people's livelihood and prevent risks. At the same time, we should also improve the counter-cyclical adjustment of macro policies, enhance structural policies in regard to institutional development, ensure we can continue to provide the basic needs in regard to social policies, and maintain continuous and healthy economic development and social stability, so as to lay a key foundation for building a moderately prosperous society in all aspects. Thank you.

Hu Kaigong:

Now let's move on to questions. Please identify your media organization before asking questions.

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CCTV:

Mr. Ning has presented in his speech just now that the economy maintained a steady growth in 2018, while we previously heard the central government used expressions like "worrisome developments amid generally steady economic operation" when analyzing the economic situation. Mr. Ning, can you please share with us your views on this expression? What do the "developments" refer to? Where do such worries come from? Which direction is the economy heading? Thank you.

Ning Jizhe:

In 2018, against the backdrop of a complicated international and domestic environment, China's national economy maintained stable and sound development momentum. The main expected goals of economic and social development were achieved, summed up in the following six aspects:

First, the economic operation was kept within a reasonable range, with the macro-control objectives all achieved. The economy maintained medium-to-high-speed growth, with total economic output reaching a new level. GDP grew by 6.6 percent over the previous year, achieving the growth target of around 6.5 percent. The growth rate ranked first among the world's top five economies. China is the largest contributor to world economic growth at nearly 30 percent. In 2018, GDP exceeded 90 trillion yuan, an increase of nearly 8 trillion yuan over the previous year. Converted using an average exchange rate, total economic output reached US$13.6 trillion, second in the world.

Price increases proved to be lower than expected, with a moderate rise in consumer prices. The CPI rose by 2.1 percent from the previous year, lower than the approximate 3 percent that had been expected.

Urban employment continued to expand, and new employment increased substantially. In 2018, the number of new urban jobs stood at 13.61 million; the urban surveyed unemployment rate remained at around 5 percent for the whole year and, in fact, was less than 5 percent in the later months of the year, achieving the target of keeping the figure below 5.5 percent that had been proposed in early 2018. Imports and exports maintained stable growth momentum, with a basic balance being achieved in international payments. For the first time, the total volume of imports and exports exceeded 30 trillion yuan, and the scale of trade in goods reached a new high, ranking first in the world. The trade structure continued to be optimized, the proportion of general trade imports and exports increased, the proportion of exports of mechanical and electrical products increased, and the foreign exchange reserves remained above US$3 trillion. The RMB exchange rate was basically stable.

Second, the three tough battles got off to a good start, and identified weak links significantly strengthened. The macro leverage ratio began to stabilize. In 2018, M2 growth was lower than nominal GDP growth. The ratio of M2 to GDP was 202.9 percent, down 3 percentage points from the previous year. At the end of November 2018, the local government debt balance was 18.29 trillion yuan, falling within designated limits approved by the National People's Congress.

We made notable progress in poverty alleviation. In 2018, the number of rural poor population in the country was reduced by more than 10 million, and 2.8 million people were relocated due to poor local conditions. We estimate about 280 poverty-stricken counties overall will have escaped from poverty.

We also made positive progress in energy conservation, emission reduction and pollution prevention and control. The energy consumption intensity continued to decline. The energy consumption for every 10,000 yuan of GDP fell by 3.1 percent year-over-year, and the proportion of clean energy consumption increased. 338 major Chinese cities saw 79.3 percent of days with fairly good air quality in 2018, 1.3 percentage points higher than 2017. The density of PM2.5 particulate matter was 39 micrograms per cubic meter last year, a decrease of 9.3 percent.

Third, supply-side structural reform further advanced. The task of reducing excessive capacity was completed ahead of schedule. We have been adhering to the market-oriented and law-based approach to reduce excessive capacity, leading to over fulfillment in the targeted reduction of steel production capacity by more than 30 million metric tons, and the removal of the coal production capacity by more than 150 million metric tons.

Deleveraging was steadily promoted, and the macro leverage ratio remained stable. The micro leverage ratio, measured by the asset-liability ratio of industrial enterprises above designated size, was down 0.4 percentage point year-over-year at the end of November 2018.

The drive for destocking proved effective. At the end of 2018, the areas of commercial housing for sale fell by 65.1 million square meters from the end of the previous year. In the past two years, a total of 180 million square meters of commercial housing stock has been cut.

Cost reduction continued to be effective. Costs in every 100 yuan of income earned from the main business of industrial enterprises above designated size continued to decline. The total scale of national enterprises and individuals' burden reduction exceeded the estimated 1.1 trillion yuan at the beginning of the year, and now it has reached more than 1.3 trillion yuan.

Much work was also undertaken to bolster weak spots. Investments in eco-environment protection, agriculture and social sectors saw accelerated growth.

The overall profitability of enterprises was on the rise. From January to November, the total profit of industrial enterprises above designated size increased by 11.8 percent year-over-year.

Fourth, the economic structure is being adjusted and optimized as the new driving force for development becomes stronger. First, the structure of demand was adjusted and optimized, and the proportion between investment and consumption witnessed rational changes. People care about consumption's contribution rate to economic growth, which was 76.2 percent last year, 18.6 percentage points higher than the previous year and 43.8 percentage points higher than the gross capital formation. The internal structure of investment is also being optimized. Private investment and investment in manufacturing both increased rapidly. Second, the industrial structure was continually upgraded, and the service industries assumed the role of "stabilizer." In terms of gross volume, the tertiary industry accounts for 52.2 percent of GDP. In terms of increment, the tertiary industry's growth is 1.8 percentage points higher than that of the secondary industry. In terms of internal structure, the industries' evolution to medium- and higher-end took speed. The value added of the high-tech industries last year increased 11.7 percent year over year, accounting for 13.9 percent of that of the industrial enterprises above a designated scale. And the share is even higher in some coastal regions. The value added of equipment manufacturing industries was faster than the growth of industries of the enterprises above a designated scale. As for agriculture, the plantation structure was optimized and adjusted, and the output of grains remained generally stable. Third, emerging industries, new products, new commercial activities and new modes continuously grew up. The emerging manufacturing industries of strategic importance and the merging service industries of strategic importance have kept comparatively fast growth. The outputs of new energy vehicles, optical fiber and smart television have increased by a large margin. The online retail sales volume has increased by more than 20 percent. Fourth, important science and technology achievements are available. The Beidou 3 satellite was successfully deployed and came into operation; the first earthquake monitoring satellite was launched; the Hong Kong-Zhuhai-Macao Bridge opened to traffic last year. Science and technology are increasingly fueling development. Earlier this year, the Chang'e 4 probe landed successfully on the far side of the moon.

Fifth, reform was deepened and opening-up was expanded, injecting new vitality into development. First, in some key fields, reforms were carried out at a deeper level. The reforms -- featuring streamlining governance and delegating power, integrating power delegation and strengthening management, and optimizing services — have yielded obvious effects. According to the World Bank's Doing Business Report 2018, China's ranking has soared 32 places from last year among 190 economies. Second, the number of market subjects increased by a large margin. Last year, the number of newly registered enterprises nationwide was up 10.3 percent year over year, and about 18,400 enterprises were registered each day on average. The National Bureau of Statistics has finished the fourth national economic census, and is now engaged in a household survey. The results of the survey indicate that the number and vitality of legal entities and industrial unity are higher than expected. Third, the finance and taxation system reform unfolded nationwide. The reforms of state-owned enterprises and state-owned assets, price reform, and reform of investment administrative mechanisms were carried forward steadily. The property ownership protection system was constantly improved. The opening-up level was continuously enhanced. The momentum of attracting foreign investment was good. Against the backdrop of the notable decline of global cross-border investment, China used $135 billion last year, up 3 percent year over year. The investment used by manufacturing industries increased by 20 percent, accounting for 30 percent of overall growth. China's foreign investment grew continuously; its economic and trade exchanges with countries along the routes of the Belt and Road were expanded. Its import and export volume with these countries, and its nonfinancial investment in these countries, both grew faster than the overall growth of imports and exports and overall foreign-bound investment.

Sixth, residents' income and spending increased rapidly, and people's livelihood steadily improved. First, residents' income grew on pace with the economy. Last year, national per capita disposable income grew 6.5 percent, higher than the 6.1 percent growth of GDP. Rural residents' income grew faster than that of their urban counterparts. According to the National Bureau of Statistics, the middle-income population in China has exceeded 400 million. Since the 18th National Congress of the Communist Party of China in 2012, the scale of the middle-income group has continuously expanded. Second, residents' spending grew quickly. Last year, the personal expenditure grew 6.2 percent, 0.8 percentage points higher than the previous year. The actual growth of the rural residents' personal consumption was 8.4 percent, faster than that of urban residents. Third, the structure of consumption was constantly upgraded. Last year, the Engel Coefficient of the national residents was 28.4 percent, down 0.9 percentage points from the previous year. The standard of the OECD countries, or developed economies, was below 30 percent. We reached the level in terms of the Engel Coefficient. Service consumption continuously improved as well. Last year, the number of domestic tourists and the revenue from domestic tourism both grew by more than 10 percent, and total box office revenue of the film industry reached 60 billion yuan, up nearly 10 percent.

At the same time, the economic performance, amid overall stability, presents aspects that arouse people's concern. The major reason firstly stems from the external environment. We are all very concerned about the way the international situation is trending, full of variable and uncertain factors. The past year witnessed ups and downs in the world economy, such as the financial market and prices of large quantities of commodities fluctuating sharply, along with a drastic fall in global investment and the prevalence of global trade protectionism and unilateralism. All these developments in the international situation impacted on China – the second largest economy in the world with its import and export volumes accounting for one-third of total GDP.

Other factors came from internal environment. Structural issues piling up over a long period are still the main aspect of all contradictions in China's development. Currently the economy is in a transition stage, during which the throes of the reform process are unavoidable, with a constantly changing situation. There are inevitably various contradictions, challenges and difficulties in such a transition period. In particular, the economy faces significant downward pressures. It should be noted that the economic growth rate dropped slightly, as was expected, of course.

Overall, in such a complex internal and external environment, it is not easy for the economy to perform within a reasonable range. Achievements have not come easily; hence, we will attach greater importance to the various problems.

Bloomberg:

I have two questions. First, in terms of the "worrisome developments" mentioned just now, what were the sources of these worries? How much came from the trade war with the U.S.? Second, it was just mentioned that the unemployment rate was 4.9 percent at the end of last year. We have read many media reports on large-scale dismissals before the New Year like those of Foxconn. The National Development and Reform Commission attributed it to migrant workers' earlier return home for the Spring Festival. Can the unemployment rate of 4.9 percent accurately describe China's situation? Thank you.

Ning Jizhe:

On your first question, how much of the worry stems from China-U.S. trade friction? This began to emerge from the second quarter of last year. In these circumstances, the Chinese government promptly adopted a policy of stabilizing employment, finance, foreign trade, foreign capital, investment and expectations. The trade friction does affect China's economic operation, but the effect is controllable overall. The data on imports and exports released some days ago also demonstrated this point, and judging from the data on China's economic performance, it is generally believed the international situation had a greater impact on China's economy in the fourth quarter. Here, I would like to share the data in December with you again.

In the past two months, some major economic indicators have risen while others have fallen, but the economy still registered a slower, but stable performance. For example, in December, major indicators on investment, consumption, performance of the industrial and service sectors were either flat or slightly up, but generally stable. Fixed asset investment from January to December rose 5.9 percent year over year. In December, retail sales of consumer goods rose 8.2 percent year over year, 0.1 percentage point higher than the growth rate in November. The added value of industrial enterprises with an annual revenue of 20 million yuan or more derived from their main business operations increased 5.7 percent year over year, 0.3 percentage point higher than that in November. The Index for Service Industry Production rose 7.3 percent year over year, 0.1 percentage point faster than November. Despite the decline of the Purchase Management Index of the manufacturing industry, the Index for Non-manufacturing Industry Business Activity increased, the service sector maintained its boom, and the Index for the Construction Industry rose sharply.

Trade friction affects not only the economies of China and the U.S., but also the global economy. In general, we are overcoming it and moving forward. Cooperation brings benefits for both countries, while confrontation brings mutual suffering. Cooperation brings gains to all countries, while confrontation brings losses to many. Working groups of the two countries maintained close communication and conducted many talks to implement the outcome of the meeting in Argentina on Dec.1 of their leaders, and achieved positive progress. It was important news for both countries and the global economy in general. I have personally noticed that the stock market or the tweets from the other side of the ocean had some positive effects on the talks. Economic globalization remains a long-term trend, and the Chinese economy is now deeply integrated into the world economy. The trade in goods between China and the U.S. exceeds US$ 630 billion. Mutually-beneficial win-win cooperation remains unchanged, and there is huge demand and potential for cooperation. Meanwhile, it should be noted that, in general, China's economic growth is led by domestic demand. In 2018, the contribution rate of consumption growth and investment growth combined surpassed 100 percent, while that of net exports was negative. Moreover, there is plenty of room for expansion in China's domestic market. Trade friction has not changed, and will not change the fundamentals of China's economic development. The country's resilience in withstanding pressure and coping with shocks, and China's overall economic growth amid stability, will remain unchanged.

Your second question is about the unemployment rate. We used the registered urban unemployment rate based on registrations with the labor authority; however, the National Bureau of Statistics began to release the surveyed urban unemployment rate last year. The latter had already been trialed internally for five years, and is considered more representative, as its system, approach and sample distribution all conform to the standards of International Labor Organization (ILO). As the ILO was most influenced by Europe, we adopted the same system and approach of surveyed unemployment rate as the European countries. In comparison, the statistical scope of the U.S. might be narrower. China's surveyed urban unemployment rate was 4.9 percent in December, while that of the U.S. was 3.9 percent. The annualized growth rate of the U.S. economy in the third quarter was 3.4 percent, while China's economy grew 6.6 percent in 2018. The surveyed unemployment rate in European countries was around 8 percent on average, but in some of the countries the figure was above 10 percent; the economic growth rate was around 2 percent. Japan's economy grew about 1 percent. Due to a labor shortage, Japan's surveyed unemployment rate was the lowest among major developed economies. The whole picture becomes clear by making a comparison of the surveyed unemployment rates of countries around the world.

There are individual cases like the one that just mentioned; in the meantime, new companies, including those worth tens of billions of yuan, are entering China, in both the service and manufacturing sectors. It is normal for foreign investment to come and go. Multinational enterprises are making readjustments globally, creating transfer employment and re-employment of some workers. Meanwhile, there is a shortage of technicians, skilled workers, and new-type talents in some companies in the coastal areas and in central and western China. Therefore, there is still a significant structural contradiction in employment. We will pay attention to the phenomena you just mentioned, promote implementation of policies giving priority to employment, so that people have jobs and lead an increasingly better-off life. Thank you for your questions.

China News Service:

According to the general market forecast, the external environment will possibly be more challenging in 2019, and several international institutions have downgraded their expectations on China's economic growth. Therefore, Mr. Ning, what will be the economic trajectory in 2019, and is it possible there will be a crescendo by the end of the year following moderating or even slow growth at the beginning?

Ning Jizhe:

The economic future of China and, indeed, the world, has drawn immense concern since 2019 arrived. Certainly, we have noted the fact of international institutions lowering their expectations for the global economy, including China as well as developed countries.

Regarding China's economy, the external environment is becoming more complex and challenging, filled with instabilities and uncertainties. Trade protectionism is still prevailing, along with unilateral protectionism and populism. More to the point, the structural problems are still prominent. However, despite various disputes, troubles, problems, challenges and even outright crises, there remain hope, opportunities and the conviction of a bright future. In 2019, we have got to be aware that opportunities form a symbiosis with challenges, especially as the economy is still forging ahead with moderate growth. Therefore, given its fundamental nature and conditions, we are convinced the economy can still perform within a reasonable range to secure constant and sound development. Amid a flagging global economy, China remains the biggest contributor to economic growth. Therefore, the fluctuations, either monthly or quarterly, are nothing abnormal and we should not be overly concerned. Our attention should be focused on key factors, such as yearly performance, the movement and tendencies in the global tide. On the whole, the world is still dominated by economic globalization, digitalized social networks, multilateral politics and cultural diversity. We have reached consensus that multilateralism, peace, development and cooperation remain mainstream conceptions globally.

As for China, the country is still and will continue to be in an important period of strategic opportunity for development. The economic fundamentals sustaining sound development remain unchanged, and will never change. The fact that China remains in the primary stage of socialism has not changed, and its international status as the largest developing country in the world is also, by no means, going to change. This means we still have an advantage of backwardness and substantial potential. In particular, the 19th National Congress of the Communist Party of China made a major decision to resolve the issue of imbalanced and inadequate development. The decision will certainly promote the country's high-quality development and ensure the economy maintains a medium-high growth rate.

There are many favorable conditions. First, tremendous changes in the world and a new development pattern emerging in China have brought about significant opportunities. There is enormous space for China to enhance openness towards and cooperation with other countries, and to participate in the reform of the global economic governance system. Meanwhile, we are speeding up economic structural upgrading, improving technological and innovation capacities, furthering reforms and opening wider to the outside world, as well as accelerating green development. All those efforts mean fresh development opportunities.

Second, China is among the most promising markets in the world. As was mentioned just now, our population is approaching 1.4 billion. China has the world's largest and fastest-growing middle-income population. According to internal measurement by the NBS, China had more than 400 million middle-income earners in 2017, and the measurement for 2018 is expected to see a higher number. There is a standard for the middle-income group. China has about 140 million households with an annual income of 100,000 to 500,000 yuan. Those 400 million people can afford cars, housing, tourism and entertainment. Therefore, consumption offers strong support for China's sustained and steady economic growth. Apart from the 400 million middle-income group, we have a large number of people in other income groups, including the high-income and the lower-middle-income. By increasing residents' income, improving the consumption environment and product quality, China is going to create a stronger domestic market and further unlock the huge consumption potential.

Third, China boasts substantial material and talent bases. After more than four decades of reform and opening up, China has established a relatively complete and comprehensive industrial system, and has been constantly improving its infrastructure, thus laying a sound material and technological foundation for economic growth. A great deal of attention is now being paid to labor, an active factor of production. China has a labor force of nearly 900 million, of which 700 million are employed people and 170 million are high-quality talents who have received higher or vocational education. More than 8 million students graduate from universities each year. With a huge population and labor force, China will continue to benefit from the demographic dividend, a rising labor participation rate and the emerging talent dividend. All those factors provide intellectual support for promoting high-quality development and opening up new growth horizons.

Fourth, the release of the reform dividend accelerated. Last year marked the 40th anniversary of reform and opening up policy; this year sees the 70th anniversary of the founding of New China. Thus, the reform was, is and will continue to be a strong driving force for China's economic development.

Fifth, macro policy has large room for maneuver and gained sufficient experience. At present, the inflation level and fiscal deficit rate are relatively low even by international standards, the foreign exchange reserves are sufficient, and macroeconomic policy has great room for a continued good operation. In this regard, we should strengthen countercyclical adjustment and implement active fiscal policies and prudent monetary policies. Active fiscal policies should be strengthened to achieve greater effect, and sound monetary policies should be maintained at a certain moderate level, coordinated with the implementation of other policies. We have enough adjustment tools and available approaches, and we have a wealth of experience. You can look back at how we responded to the Asian financial crisis 20 years ago. You can also look back at how we responded to the international financial crisis 10 years ago. Despite the challenges and changes taking place in the world, we have hard-working and intelligent people, we have strong leaders, and we have rich and diverse experience, so we will be able to turn crises into opportunities, seize opportunities, overcome challenges, reverse downward pressure to lifting force, promote economic to advance in stability, and strive for high-quality development.

CGTN:

We noticed a steady increase of consumption in 2018. However, there are concerns about consumption downgrade. What are your thought on this matter? We also noticed the newly released data showing that consumption fell from 78 percent of GDP growth in the first three quarters to 76.2 percent. What's your understanding of this fluctuation?

Ning Jizhe:

The contribution rate of consumption to economic growth in 2018 is higher than the previous year. The slight decrease you mentioned does not reveal anything serious. Generally speaking, the consumption structure is upgrading as people's income raises. Our Engel's Coefficient has been decreasing in recent years, which means people's non-material expenditure has been rising. And we all know that the data on people's income and expenditure are acquired through household surveys, in which electronic accounting is promoted. About 60 percent of those surveyed now use electronic accounting which is internationally comparable.

Another important point is that high-quality consumption is trending. Cheap and fine goods have a market, but the ones of higher quality and higher price are being embraced by the middle- and upper-income families. I think we all have an impression that the rate of service consumption is rising. Domestic tourists are increasing at double-digit growth, and a huge number of tourists are making overseas trips. Globalization comes with a spillover effect in consumption, which will be good for other countries. We also see rapid growth in consumption of culture, information, education and training, and health.

So far there is no effective method of measurement in this regard, and following the instruction of the State Council, the National Bureau of Statistics is trying to expand the total retail sales of consumer goods to cover service consumption. Service consumption in the fields of tourism, culture and health haven't been included in the total retail sales of consumer goods. But we still see a 9 percent increase, which is worth noting. Shifting from high-speed growth to medium-to-high-speed growth, we need to upgrade our thought patterns to realize a reasonable economic performance and achieve high-quality growth. To embrace the upgrading of consumption, we will improve our production structure, adjust our industrial and investment structures, and boost our consumption infrastructure. We will work hard to facilitate consumption's fundamental role in economic development.

Thank you.

Market News International:

Last year's market price was lower than expected and the CPI (consumer price index) as well as the PPI (producer price index) were also weakening in December. How do you expect the CPI and PPI will go this year? What are the risks of deflation? You said the country should enhance through counter-cyclical adjustments to its macro policies, could you discuss some of the factors in macro policies that are worthy of attention?

Ning Jizhe:

The CPI growth last December was below 2 percent and the PPI growth also fell month over month. Last year, the CPI and PPI grew moderately at 2.1 percent and 3.5 percent respectively, which was as expected by the Chinese people. There are many factors affecting CPI growth, the most important of which is the relationship between supply and demand, including that of manufactured consumer goods and agricultural products. We have sufficient and diversified supply of agricultural products, stable grain output, and a portfolio of business models. The supply and demand of manufactured consumer goods is generally stable, with the supply of most of the goods being higher than demand. Now manufacturing needs to improve standards and quality for higher consumption demand. The relationship between supply and demand influences pricing. We can analyze these two in relationship with each other to grasp the trend of price changes. Of course, PPI is not only affected by domestic supply and demand but also by the changes in the price of global commodities. Domestically, supply-side structural reform helped to solve the troubles of traditional industries like excess production and subsequently low prices. Internationally, the drop in global commodity prices, especially of energy products, in Q4 also affected PPI growth, as China is already a key importer and exporter of capital goods. There are still some uncertainties ahead in 2019. Macro-economic research as well as research on market prices, should take domestic and international factors into account.

As for the potential "deflation" risk of some media concern, China has not seen overall deflation in the past 10 years, but there were some kinds of structural deflation factors in certain years. It is inappropriate to say that China faces the risk of deflation this year. Given the economic climate and other background factors, we expect that prices will see a moderate rise this year. Pricing changes are affected by the relationship between market supply and demand, and this leads to your second question on counter-cyclical adjustments to macro policies. Macro policies should not only deal with structural problems, key problems and key elements, but also take the balance of supply and demand into consideration. Counter-cyclical adjustments help reduce downward pressure of economic growth, while supply-side structural reform helps improve the relationship between supply and demand, as well as promote overcapacity reduction and structural deleveraging. At the same time, we should take stable overall demand into consideration. The government policy is very clear now that it will implement a proactive fiscal policy and prudent monetary policy. The proactive fiscal policy is to increase efficiency through bolder and more effective measures while the prudent monetary policy is to be "neither too tight nor too loose." The former involves cutting taxes and fees on a larger scale, substantially increasing the issuance of special-purpose local government bonds, and raising investment within the central government budget to channel more energy into weaker areas. Moreover, the finance department has made arrangements to improve efficiency in asset allocation and to enhance performance. The monetary policy should be "prudent," which implies that it should be "neither too tight nor too loose," and should maintain market liquidity at a reasonably ample level; keep proper increases for the scale of currency, credit and social financing; improve financing and credit structures by following the requirements of deepening supply-side structural reform; increase financial support for private enterprises; and smooth out the monetary policy transmission mechanism to increase direct financing to the brick-and-mortar businesses and small- and medium-sized enterprises, for the purpose of better serving the real economy. Therefore, the policy orientation is very clear.

Thank you.

Phoenix TV:

Our question concerns the total population. The number of births has been shrinking for the second consecutive year, with the birth rate and the natural population growth rate reaching new lows. What do you think of this situation? Does the gradual decline in population growth rate mean the demographic dividend of China's economic growth is disappearing ahead of schedule?

Ning Jizhe:

Recently, people are very concerned about the population data. Some research articles suggest the population will see so-called negative growth. The data released by the National Bureau of Statistics (NBS) has clearly shown that, in 2018, China's population is not only growing, but also the number of births, 15.23 million, is relatively large. This figure is still very impressive. As for the decline in the population growth rate and birth rate, you mustn't concentrate on the one-year data. We need to undertake long-term observation on this point. We have had population peaks in our history, and, now, the structural changes in population occur naturally; so, we shouldn't over-interpret it.

The demographic structure changes with economic and social development. As mentioned earlier, the demographic dividend still exists. China has labor resources of nearly 900 million people. This scale is huge, despite some fluctuations. The labor participation rate is not low in global terms. More than 700 million out of 900 million people are employed, and there is still room for growth. The quantity of labor itself presents a great potential. Everyone notices that there are still 288 million migrant workers, which is a very large pool of available labor. Although the population who reside in areas other than that of their household registration has declined, the number is still very large. The reason for the decline is that 100 million workers have been employed in cities, being transformed from farmers into urban residents. Now, with the development of the central and western regions, foreign companies and domestic companies in coastal areas have invested more there. With the improvement of transportation and infrastructure in these areas, and the implementation of various regional development strategies, migrant workers have returned to their hometowns, many finding jobs in secondary and tertiary industries nearby, creating a new trend. The quality of the labor force is improving constantly; coupled with the fact appearance of eight million college graduates each year, their contribution to industrial upgrading and talent bonuses will become even more prominent. We attach more importance to the talent bonus, and, along with the fact that China still has a demographic dividend, it can be said that the factors supporting the medium and long-term positive trend of the national economy have not changed.

Yicai TV:

Statistics for the full year of 2018 indicated a further pickup in the investment expansion rate from the first three quarters. My question is, will infrastructure investment have a bigger impact on, or a bigger contribution to economic growth in 2019? What will be the points of weakness to be strengthened this year?

Ning Jizhe:

Investment indicators have underperformed compared to consumption indicators these past few years. We have quite a few points of weakness that need to be strengthened. Although we are already an upper-middle income country overall, and the world's second largest economy, we still have the problem of very unbalanced development. Levels of infrastructure facilities vary greatly between localities, so infrastructure development remains a major area of weakness to be strengthened. Since October, as our efforts to address points of weakness intensified, the expansion rate of fixed asset investment rebounded. Investment primarily covers three types: manufacturing, infrastructure and real estate. Infrastructure investment growth was weaker than that of manufacturing. In short, infrastructure development, especially for improving the consumption environment and for implementing the rural revitalization and regional development strategies, remains a weak point. Compared with developed countries, we have a relatively new expressway network and the world's longest total length of high-speed railways. However, when measured on a per capita basis, our operational infrastructure amount is remarkably lower. For example, we are low on airport coverage, compared with Europe and America. The task to accelerate infrastructure development for the direct benefit of people's livelihood in both urban and rural areas is still heavy.

Besides, houses built for people relocated from inhospitable areas need to be complete with supporting infrastructure facilities. In terms of government-subsidized housing, we will intensify efforts to rebuild shantytowns and supply public rental housing. Of course, agriculture and water conservancy are also areas with big room for improvement. We need to implement the rural revitalization strategy. There are also major water conservancy projects and major 13th Five-Year Plan projects still under construction. In terms of transportation, urban public transportation and transportation between city clusters need improvement, renovation and upgrading. I said a moment ago that we have an urbanization rate of nearly 60 percent. However, even with the fast railway construction, we still cannot fully satisfy people's needs. These are all weak points that are closely related to people's livelihood that need strengthening. It can be expected that, policies will continue to be put in place and take effect this year, resulting in stronger data than last year. Thanks.

Hu Kaihong:

That's all for today's press conference. Thank you, Mr. Ning. Thank you, everyone.

.

Read in Chinese

Speaker:
Li Kuiwen, spokesperson of the General Administration of Customs and director general of the Department of Statistics & Analysis of the General Administration of Customs

Chairperson:
Hu Kaihong, spokesperson for the State Council Information Office of China

Date:
Jan. 14, 2019

Hu Kaihong:

Ladies and gentlemen, good morning. Welcome to this SCIO briefing. Starting today, we will hold a series of briefings to introduce the statistical data of China's economic performance for the full year of 2018. Today, we are delighted to invite Mr. Li Kuiwen, spokesperson of the General Administration of Customs and director general of its Department of Statistics & Analysis, to talk about the state of China's imports and exports in 2018. He will also answer questions of interest to you. 

Now, I will give the floor to Mr. Li.

Li Kuiwen:

Before taking your questions, I would like to give you a brief introduction of the general situation with China's foreign trade imports and exports in 2018.

In 2018, under the leadership of the CPC Central Committee and the State Council, all localities and departments actively implemented a series of policies and measures to promote the stable growth of foreign trade, effectively responding to the profound changes in the external environment. During the year, foreign trade remained stable overall and saw steady growth, with the import and export scale reaching a record high. Therefore, China is expected to maintain its position as the world's largest trader in goods. According to customs statistics, the total value of China's foreign trade, imports and exports together, was 30.51 trillion yuan in 2018, an increase of 9.7 percent from 2017. Of that, exports grew 7.1 percent to 16.42 trillion yuan, while imports went up 12.9 percent to 14.09 trillion yuan, and the foreign trade surplus shrank 18.3 percent to 2.33 trillion yuan. Priced in terms of U.S. dollars, China's total foreign trade value was US$4.62 trillion in 2018, up 12.6 percent. Exports amounted to US$2.48 trillion of that, up 9.9 percent, and imports were US$2.14 trillion, up 15.8 percent from the previous year. The foreign trade surplus stood at US$351.76 billion, shrinking 16.2 percent. Specifically, the foreign trade situation presents the following characteristics.

First, imports and exports have seen a steady upswing, reaching a combined value of 10 trillion yuan for the first time in 2005, then 20 trillion yuan in 2010. In 2018, the volume hit a new height by exceeding 30 trillion yuan, 2.7 trillion yuan more than the previous year.

Second, imports and exports of general trade grew rapidly as well, representing an increased proportion. The volume reached 17.64 trillion yuan last year, a growth of 12.5 percent year over year. This constituted 57.8 percent of the country's entire imports and exports, 1.4 percentage points higher than the ratio in 2017, indicating an improvement of trade structures.

Third, China's imports and exports with major trade partners secured overall growth. China maintains good cooperative momentum with countries along the Belt and Road. Trade with China's top three partners, namely the European Union, the United States and the Association of Southeast Asian Nations (ASEAN), increased by 7.9 percent, 5.7 percent and 11.2 percent respectively in 2018. In combination, these accounted for 41.2 percent of China's total imports and exports. At the same time, trade with the countries along the Belt and Road reached 8.37 trillion yuan in aggregation, up 13.3 percent year over year and 3.6 percentage points higher than the country's holistic trade growth. The potential of trade partnerships between China and countries along the Belt and Road has continued to evolve, forming a new driving force behind the country's foreign trade as a whole. Specifically, imports and exports to Russia, Saudi Arabia and Greece increased by 24 percent, 23.2 percent and 33 percent, respectively. 

Fourth, the import and export of private enterprises have increased, and their proportion of China's total imports and exports has also grown. In 2018, the import and export of private enterprises in China was 12.1 trillion yuan, an increase of 12.9 percent compared to 2017. Private enterprises accounted for 39.7 percent of China's total imports and export value, an increase of 1.1 percentage points over 2017. Exports were valued 7.87 trillion yuan, an increase of 10.4 percent. Private sector exports continued to dominate the Chinese export market, accounting for 48 percent of the total export market, an increase of 1.4 percentage points over 2017. Meanwhile, imports reached 4.23 trillion yuan, an increase of 18.1 percent. In 2018, the contribution of private enterprises in China to the growth of foreign trade imports and exports exceeded 50 percent, which became a highlight of China's foreign trade development. During the same period, the import and export of foreign-invested enterprises were 12.99 trillion yuan, an increase of 4.3 percent, accounting for 42.6 percent of China's total imports and exports. The import and export of state-owned enterprises were 5.3 trillion yuan, an increase of 16.8 percent, accounting for 17.4 percent of China's total imports and exports.

Fifth, the growth rate of imports and exports in the central, western, and the northeastern regions was higher than the overall national growth rate, and regional development was more coordinated. In 2018, the growth rate of foreign trade in the 12 provinces and cities in the west registered at 16.1 percent, exceeding the national growth rate by 6.4 percentage points. The growth rate of foreign trade in the six provinces and cities in the central region was 11.4 percent, exceeding the national growth rate by 1.7 percentage points. The growth rate of foreign trade in the three northeastern provinces was 14.8 percent, exceeding the national growth rate by 5.1 percentage points. Finally, the growth rate of foreign trade in the 10 eastern provinces and cities stood at 8.8 percent.

Sixth, mechanical and electrical products took a larger share of China's exports, and the export commodity structure has been further optimized. In 2018, exports of mechanical and electrical products amounted to 9.65 trillion yuan, an increase of 7.9 percent, accounting for 58.8 percent of China's total exports. And this percentage grew by 0.4 percentage points from 2017. China's automotive exports grew by 8.3 percent and cellular phone exports by 9.8 percent. Toys, garments and five additional labor-intensive products exported by China in 2018 reached a combined total of 3.12 trillion yuan, which is 1.2 percent more than last year, accounting for19 percent of the total.

Seventh, both the import price and volume of oil, gas, copper and other commodities are on the rise, while the import volume of iron ore and soybean have fallen. China's import of crude oil amounted to 462 million tons, gas 90.39 million tons, refined oil products33.48 million tons and copper 5.3 million tons, up 10.1, 31.9, 13 and 12.9 percent from last year, respectively. On the other hand, the import of iron ore fell by 1 percent to 1.064 billion tons and soybeans fell by 7.9 percent to 88.03 million tons. Preliminary estimates indicate that the China's import prices on the whole increased by 6.1 percent in 2018, and that the import price of oil grew by 30 percent, refined oil products by 20 percent, gas by 22.9 percent and copper by 3.2 percent.

In 2019, the General Administration of Customs will be guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the spirit of the 19th CPC National Congress and the second and third plenary sessions of the 19th CPC Central Committee and commit to the arrangements of the Central Economic Work Conference. Sticking to an overall tone of making progress while maintaining stability, we will work to stabilize employment, the financial sector, foreign trade, foreign and domestic investments, and expectations, and promote various customs reforms with a focus on optimizing the business environment at ports and promoting higher quality while maintaining stability in foreign trade to better serve the socioeconomic development of the nation.

Now, I'm ready to take your questions.

Hu Kaihong:

Thank you, Mr. Li. Now, the floor is open. Please identify the media outlet you represent before raising questions.

CCTV:

Director Li, can you summarize China's foreign trade performance in 2018? What do you think are the new features and highlights of China's foreign trade development during the past year? Thank you.

Li Kuiwen:

Thank you for your question. China's foreign trade achieved steady growth in 2018; the scale of imports and exports reached a new historical high; and quality and efficiency were further improved.

The achievements were hard-won and based on the following five aspects:

First, the business environment is friendly. Last year, China introduced a series of policies and measures to reduce taxes and optimize the business environment at ports; therefore the level of foreign trade facilitation has significantly improved. According to the "Doing Business 2019" report released by the World Bank, China has advanced 32 ranks in business environment, and the cross-border trade made a progress from the 97th position to the 65th position, also 32 advancing ranks. In addition, China increased its export tax rebate rate of some commodities two times last year, and lowered import tariffs on medicines, automobiles and accessories, daily consumer goods; thus promoting the increase of exports and imports.

Second, there has been an increase in foreign trade enterprises. The Chinese economy maintained a steady growth in 2018 and operated within its proper range; this provided a good environment for foreign trade development. According to our statistics, the number of enterprises with actual import and export performances has increased from 436,000 in 2017 to 470,000 now.

Third, the wide range of trade partners. In 2018, China's foreign trade market became more diversified. In the process of maintaining growth with traditional trade partners, China also proactively encouraged exchanges with other countries and regions. In 2018, the import and export growth rate with countries along the Belt and Road routes, Africa and Latin America, was respectively 3.6, 6.7 and 6 percentage points higher than the total imports and exports growth rate. 

Four, the growth momentum has been strong. In terms of quantity and price factors, import and export growth was strong in 2018. According to estimates by the General Administration of Customs, China's import quantity index was 106.4 and the export quantity index was 103.6. The contribution rate of import and export both exceeded 50 percent, and the growth momentum became more solid.

Five, high quality and efficiency. China's import and export proceeded in a more balanced way with more coordinated regional development and improved product structure. From the perspective of products, the export of some mechanical and electrical products and equipment manufacturing products maintained great growth momentum. For example, the export of metal processing machines grew by 19.2 percent; mobile phones grew by 9.8 percent and automobiles increased by 8.3 percent. The import of equipment, key parts and components of high-quality consumer goods also grew rapidly. For example, integrated circuits increased by 16.9 percent; consumer goods increased by 10.9 percent, and aquatic and marine products increased by 39.9 percent respectively. The quality and efficiency of both imports and exports improved to a great extent.

That's all of my opinions regarding China's foreign trade situation in 2018.

Economic Daily:

We have noticed import growth slowed down slightly in the fourth quarter; so, what was the main reason for that? Besides, the annual central economic work conference pointed out that there are new and worrisome developments amid the generally steady economic operation. How do these new development features reflect foreign trade in general? And what is your expectation for general foreign trade in 2019? Thank you. 

Li Kuiwen:

Thank you. Let me start by answering your first question about imports and exports in the fourth quarter.

In the fourth quarter of 2018, imports and exports registered year-on-year growth of 8.8 percent. The growth rate was slower than that of the third quarter. I think that was due to the following reasons:

First, the volume of imports and exports increased quarter by quarter. [These] reached 6.76 trillion yuan, 7.36 trillion yuan, 8.18 trillion yuan and 8.21 trillion yuan during the four quarters of last year respectively, with figures exceeding 8 trillion yuan in both the third and fourth quarters, a high level. 

Second, the growth rate of imports and exports still remains within its proper range. The main reason for the subdued growth rate in the fourth quarter are attributed to last year's large base figure. The base figure of the fourth quarter was five percent larger than that of the third quarter. However, compared to the third quarter, imports and exports increased by 0.3 percent in the fourth quarter. 

In regard to the situation you just mentioned, that the growth rate of imports and exports slightly slowed down in the fourth quarter, we consider such fluctuations as normal, and related to many factors including the domestic and international economic situation, commodity prices and the plans of foreign trade enterprises. In our opinion, such fluctuations will weaken over a longer period. 

Regarding the second question you raised about hidden concerns in China's foreign trade, we believe that the biggest worry about the development of China's foreign trade in 2019 is that the external environment is complex and harsh, and there are many uncertainties. In some countries, protectionism and unilateralism are on the rise, and world economic growth may slow down, affecting cross-border trade and investment. At present, major international organizations have already lowered their expectations for growth of the global economy and trade. For example, the World Bank recently lowered its forecast of global economic growth in 2019 from 3 percent to 2.9 percent, reflecting concerns about the current trends in international trade.

Your third question is about the general trends of China's imports and exports in 2019. In general, China will keep its economic development on a stable and healthy track. The central government has successively issued a series of policy measures to stabilize foreign investment. And the effect is showing, laying a solid foundation through policy for the advancement of foreign trade this year. At the same time, the external environment is still complicated and severe. There are still many uncertain and unstable factors, and objective factors such as last year's large base figure, all of which may slow the growth rate of foreign trade. 

We believe that with further opening up and the further advancement of supply-side structural reforms, China's foreign trade development this year is expected to stabilize and improve in terms of both quality and efficiency. Thank you.

TASS:

According to the statistics of the Ministry of Commerce, as of December 2018, the trade volume between China and Russia has exceeded US$100 billion. What kind of expectations does the General Administration of Customs have on the economic and trade cooperation between the two sides in 2019?

Li Kuiwen:

Thank you for the question. In 2018, against the background of frequent high-level visits and all-round cooperation between China and Russia, the two countries' economic and trade relationship continued to increase, and Sino-Russian economic and trade cooperation has maintained a good momentum of development. According to customs statistics, China's imports and exports to Russia in 2018 were 707.55 billion yuan, a year-on-year increase of 24 percent, accounting for 2.3 percent of China's total import and export value during the same period. Among them, exports to Russia reached 316.65 billion yuan, an increase of 9.1 percent, and imports from Russia reached 390.9 billion yuan, an increase of 39.4 percent. If denominated in U.S. dollars, the bilateral trade volume between China and Russia reached US$107.06 billion in 2018, surpassing US$100 billion for the first time, a record high, with an increase of 27 percent. The growth rate ranked first among China's top ten trading partners. In terms of main import and export commodities, exports to Russia were mainly mechanical and electrical products, while imports from Russia were mainly energy resource products such as crude oil, coal and sawn timber.

This year marks the 70th anniversary of the establishment of diplomatic relations between China and Russia. Both countries will work together to further strengthen strategic cooperation, promote cooperation in all fields, and promote China-Russia's comprehensive strategic partnership of coordination to achieve more fruitful results and better benefit the two peoples. It is expected that there will be new developments in Sino-Russian economic and trade relations this year. Thank you.

Reuters: 

I'd like to ask how the import and export figures with the U.S. in 2018 compared with 2017? And what's your projection for the year to come? Thank you.

Li Kuiwen: 

Thanks for your questions. Now I'd like to inform you of some figures regarding the Sino-U.S. trade due to the wide concerns in this regard. Data from the General Administration of Customs show that, in 2018, the volume of our trade with the U.S. was 4.18 trillion yuan, 5.7 percent up year-on-year. Our exports to the U.S. hit 3.16 trillion yuan, a gain of 8.6 percent. Our imports from the U.S. fell 2.3 percent to 1.02 trillion yuan. This means our trade surplus in 2018 was 2.14 trillion yuan, up 14.7 percent year-on-year. Priced in dollars, the total value of the imports and exports between China and the U.S. reached US$633.52 billion, 8.5 percent up year-on-year. The total value of bilateral exports hit US$478.42 billion, 11.3 percent up year-on-year, and the total value of bilateral imports was US$155.1 billion, a 0.7 percent gain. We see China's trade surplus with the U.S. rising to US$323.32 billion, 17.2 percent up year-on-year. China's 2018 trade surplus with the U.S. somewhat widened compared with 2017, which we think demonstrates the complementarities between the two economies in different stages of development.

Phoenix TV:

China's foreign trade performed well in 2018. However, both the General Administration of Customs and the National Bureau of Statistics said that the performance was partly attributable to declarations in advance of the tariffs. Do you think the export demand for 2019 has been overdrawn? Does it mean weaker external demand in 2019? Thank you.

Li Kuiwen:

I have introduced the overall trend in China's foreign trade. We believe that this year's overall trend in foreign trade, on the basis of last year will see an improved quality at a steady pace. Despite concerns over the trade development caused by external uncertainties, we believe that China's foreign trade will see improved quality and performance while maintaining steady growth this year. A reporter from CCTV asked a similar question just now, and I have given my answers. Thank you.

China News Service:

We notice the imports and exports of Chinese private companies provide an increased proportion of the overall trade last year. Could you introduce some of the key features in their growth? How does the General Administration of Customs support their trade growth? Thank you.

Li Kuiwen:

I just introduced some general information about the imports and exports of Chinese private companies, which has grown rapidly and assumed a rising proportion in the overall trade. Now, I would like to share some of the other salient features.

First, imports and exports of private companies have achieved greater dynamism. In 2018, around 372,000 private companies participated in foreign trade, an increase of 10.7 percent year-on-year. They contributed more than half of the foreign trade growth in 2018, thus playing a more important role in overall trade development.

Second, different regions were at different echelons of growth in terms of import and export volume by private enterprises. The central, western, and northwestern regions recorded a growth rate of 20.3 percent, 18.9 percent and 16.7 percent respectively, all higher than the eastern region, which achieved a 12.1 percent gain last year.

Third, the trade structure of private companies continued to upgrade. Mechanical and electrical products accounted for over 40 percent of both their import and export value. The export of integrated circuit, mobile phones and LCD panels increased by 51 percent, 16.8 percent and 34.1 percent respectively, while the import of integrated circuit, agricultural products and plastics in primary forms grew by 35.3 percent, 11 percent and 27.5 percent.

In support of private enterprises, GAC is putting into practice the principles drawn from General Secretary Xi Jinping's addresses at a symposium on private enterprises held on Nov. 1, and has also introduced a series of measures to support private enterprises to reduce their financial burdens and increase efficiency. I'll introduce the situation in three aspects:

First, we have launched pilot programs for tariff guarantee insurance. We expanded the existing guarantee method by introducing insurance companies into customs tax guarantee system to ease the enterprise burden, especially for small and medium-sized enterprises. We also encouraged SME innovation by exempting the tax on imported products related to scientific research and technological development for qualified SME public service demonstration platforms.

Second, we have promoted integration reforms, so that import and export-oriented enterprises can directly use the national enterprise credit information publicity system to deliver their annual reports, and no longer need to report separately to different departments. Among those qualified, more than 60 percent are private enterprises. The number of the annual report items has been reduced to around 40 from more than 120, a reduction of 70 percent.

Third, we have helped private enterprises "go global." The General Administration of Customs has promoted mutual recognition of the Authorized Economic Operators (AEO) with 36 countries and regions, and helped private enterprises to enjoy the various conveniences provided by local customs. Thank you.

CCTV:

Mr. Li, we know that in early December the cross-border e-commerce policy was further clarified through the press conference, which not only expanded the scope of the tax items, but also expanded the quota for individual transaction limits. Is there any substantial increase in annual data on retail imports and exports of cross-border e-commerce, particularly in December? Thank you.

Li Kuiwen:

Thank you for your attention. Cross-border e-commerce has always been an important area under customs supervision. China's e-commerce law took effect on Jan. 1, 2019, providing legal support for cross-border e-commerce customs supervision, protection of consumer rights and intellectual property rights. The General Administration of Customs actively cooperated with the Ministry of Commerce to study and formulate a new overall supervision plan for cross-border e-commerce after the transition period, and accordingly issued the "Announcement on Matters concerning the Supervision of Retail Imports and Exports in Cross-Border E-commerce", clarifying the scope of cross-border e-commerce supervision and the responsibility of participating subjects. This includes adding a series of new regulatory service measures; and further standardizing and strengthening the supervision of cross-border e-commerce.

There is a piece of data I would like to share with you. In 2018, the total volume of retail import and export commodities through the customs cross-border e-commerce management platform was 134.7 billion yuan, an increase of 50 percent; of which exports were 56.12 billion yuan, an increase of 67 percent; and imports were 78.58 billion yuan, an increase of 39.8 percent. 

In the next step, the General Administration of Customs will further improve the information system for cross-border e-commerce retail imports and exports; improve and upgrade tax administration, quota control, and declaration management; and further meet the needs of cross-border e-commerce customs supervisions. This will also better serve internet users. Thank you.

Die Welt:

Would you like to provide us the import and export data on China's trade with Europe, Germany and the Democratic People's Republic of Korea?

Li Kuiwen:

Thank you for your question. Let me first introduce the data on China-EU. Statistics from customs show that China's trade with Europe in 2018 amounted to 4.5 trillion yuan, a year-on-year growth of 7.9 percent. China's exports to the EU totaled 2.7 trillion yuan, a 7 percent increase from last year, while imports from the EU reached 1.8 trillion yuan, up 9.2 percent from the previous year. EU remains China's largest trade partner and the biggest source of imports. China and Europe are important partners in trade. Specific data on China-Germany trade will be released on the customs website, to which you are welcome to refer. Regarding China's trade with the DPRK, I can provide certain data here. According to the customs, China-DPRK overall imports and exports value totaled 16.09 billion yuan, a decrease of 52.4 percent from last year. China's exports to the DPRK reached 14.67 billion yuan, which fell by 33.3 percent, and imports totaled 1.42 billion yuan, an 88 percent drop. The trade surplus expanded 29.9 percent to 13.26 billion yuan. For China-DPRK trade, China customs have always adopted the resolutions of UN Security Council in a comprehensive and strict way. Thank you.

China Business Network (CBN):

How would you define characteristics of the imports in 2018? How will the policies, implemented recently to expand domestic demand and consumption, influence imports this year?

Li Kuiwen:

Thanks for your questions. However, I prefer to respond in view of both imports and exports. Regarding imports, we adopted a string of policies to sustain sound development of foreign trade, expanding import capacity proactively. Throughout 2018, imports increased by 12.9 percent from the previous year and maintained good growth momentum, which shows in a number of respects, as follows:

First, quantity has played an increasingly important role in adding import value. The Import Quantum Index reached 106.4 in 2018, up 6.4 percent year over year. The expansion of import quantity contributed 51.2 percent to the growth of total import values in our country. At the same time, the Import Price Index reached 106.1, up 6.1 percent year over year. 

Second, import tax rebate policies on certain products resulted in rapid growth. In 2018, cosmetics imports grew by 67.5 percent to 65.7 billion yuan, while aquatic products rose 39.9 percent to 79.4 billion yuan, with both of these being higher than the overall import growth. 

Third, micro market entities' import businesses showed vitality. In 2018, 211,000 enterprises had import records, 6,300 more than a year before. Among them, 57,000 enterprises accessed new import business, or 26.8 percent of the total figure. All the figures well defined the effectiveness of policies, such as proactive import expansion, adopted to boost imports among domestic enterprises.

Regarding exports, the two-time export tax rebates in 2018 helped a number of products to go global. On Sept. 15 of last year, China raised tax rebates on the first batch of 397 export commodities, including electromechanical and cultural products. In 2018, the combined value of the first batch of products enjoying the increased rebate totaled 745.1 billion yuan, up 8 percent year over year, and 0.9 percentage point higher than export growth as a whole. On Nov. 1 of last year, the tax rebate covered 1,172 products, valued at 1.53 trillion yuan, up 7.5 percent year over year, and 0.4 percentage point higher than the overall export growth. The growth of exports accelerated particularly rapidly in November and December, increasing by 13.3 percent, 7.1 percentage points higher than in the first 10 months combined. Those statistics are for reference. Thank you.

Economic Herald:

What's your projection for China's efforts in expanding imports? Thank you.

Li Kuiwei:

We have touched upon the issue of expanding imports in a couple of questions. I think the first China International Import Expo held last year sent a strong message that China would further expand its imports. Generally speaking, we will exert more effort to realize trade balance, boost the domestic economy, and import scarce key components and consumer goods this year. Particularly, the second China International Import Expo will be held, with the country pushing forward its all-round opening up policy. The General Administration of Customs will take more measures to support the move and improve trade facilitation. 

Thank you.

Hu Kaihong: 

I'm afraid today's press conference has reached its conclusion. Thank you, Mr. Li. Thank you, everyone. 

Read in Chinese

Speakers:

Xie Zhenhua, China's Special Representative on Climate Change

Li Gao, Director-General of Climate Change in the Ministry of Ecology and Environment

Chairperson:

Xi Yanchun, spokeswoman of the State Council Information Office

Date:

Nov. 26, 2018

Xi Yanchun:

Good morning, Ladies and Gentleman. Welcome to this press conference. The 2018 United Nations Climate Change Conference will soon open in Poland. Today, the document on "China's Policies and Actions for Addressing Climate Change (2018)" was officially published. To help you gain a better understanding of the related situation, we are pleased to have Mr. Xie Zhenhua, China's Special Representative on Climate Change, here to introduce the report and answer your questions. We also have with us Mr. Li Gao, Director-General of Climate Change in the Ministry of Ecology and Environment. Now, I give the floor to Mr. Xie.

Xie Zhenhua:

Welcome to the press conference on China's Policies and Actions for Addressing Climate Change (2018). It is customary to hold such a press conference every year before the Climate Change Conference, in which we report to the public, especially the international community, on the annual progress, achievements and problems of China's policies and actions for addressing climate change. It demonstrates that China's policies and actions are completely open and transparent in this field.

This year's Conference of the Parties to the United Nations Framework Convention on Climate Change will be held in Katowice, Poland. It is the 24th COP and is internationally known as Katowice Climate Change Conference. Today's briefing will focus on the latest progress and major achievements of our country's response to climate change since 2017. These include climate change mitigation and adaptation, local action, broad societal participation, institutional development, improvements of basic capabilities, active participation in international negotiations and strengthening of international exchanges and cooperation. We will demonstrate the policies, actions and results of our country's response to climate change in various sectors, localities and fields.

As we all know, the Chinese government attaches great importance to tackling climate change, and regards the promotion of green and low-carbon development as an important part of the construction of an ecological civilization and a major opportunity to accelerate the transformation of economic development and adjust the existing economic structure. Since 2017, China has made positive progress in mitigating climate change, adapting to climate change, improving institutions, strengthening capacity building, encouraging local action, and raising public awareness.

In accordance with the Chinese government's work plans and specific measures for institutional reform this year, the responsibilities for addressing climate change and emission reduction have been transferred to the newly-established Ministry of Ecology and Environment. During the National Conference on Ecological and Environmental Protection held in May this year, President Xi Jinping stressed that we will implement a national strategy for actively addressing climate change. This will include advancing and guiding the establishment of a global climate governance system featuring fairness, rationality and win-win cooperation. We will also honor the image of China as a responsible country, and endorse the building of a community with a shared future for mankind. We will act with firm resolve to implement President Xi's instructions, fully enacting the national strategy for addressing climate change. China will proactively participate and take the lead in global climate governance, and play a greater role in dealing with climate change in high-quality development, promoting ecological progress, and tackling environmental pollution. 

The Chinese government has always proactively and constructively participated in international negotiations on climate change, and adheres to the principles of the UNFCCC. China upholds the principles of common but differentiated responsibilities and respective capabilities, and works with all parties to promote global climate governance. We have continuously strengthened dialogues and exchanges with various parties and carried out pragmatic cooperation on climate change. While promoting South-South cooperation on climate change, we have provided vigorous support to developing countries in enhancing their capability to adapt to climate change. Our efforts and approaches have been highly praised by the international community and are widely welcomed by developing countries.

This week's United Nations Climate Change Conference in Katowice, Poland, signifies a critical juncture in the global climate governance process. We hope that the General Assembly will complete the negotiations on the implementation of the Paris Agreement as scheduled. We must properly address the financial problems, and send a positive message to the international community to implement the Paris Agreement, promote green and low-carbon industrial development, and build a community with a shared future for mankind. We will continue to play an active and constructive role in working with all parties to promote the success of the conference in Katowice.

Today we are here to announce the release of this report. Now let's get to the Q&A session, in which Mr. Li Gao and I would like to take your questions. Thank you.

Xi Yanchun:

Thank you, Mr. Xie. Now, the floor is open to questions. Please identify your media outlet before raising questions.

CCTV:

What are China's expectations for the upcoming Climate Change Conference in Poland? Thank you.

Xie Zhenhua:

We have the same expectations as the international community in general for the upcoming conference, and these can be summarized in three aspects.

First, the Paris Agreement adopted in 2015 has taken effect. Now, the main task is to finish the negotiations on implementation guidelines so they can be adopted at the annual climate change conference in Katowice, Poland. Hopefully, we will establish a mechanism to ensure continuity in implementation of the Agreement.

Second, in accordance with the Agreement and the decisions taken at last year's conference, we will have a Talanoa Dialogue at this conference. Initially called a "facilitative dialogue", this gets its name from the Fijian language as it was proposed at the meeting last year in Fiji. During the dialogue, all parties should introduce the best practices they have been able to adopt to address climate change, and discuss their efforts and difficulties in implementation, so as to enhance understanding and strengthen cooperation among all parties concerned. The ultimate purpose of the dialogue is for countries to share their successful experiences to promote accelerated transformation in line with the green and low-carbon development mode.

Third, we must review the implementation of the pre-2020 commitments through the dialogue. For example, this entails examining what each country has done and how effective the measures are, and if the decisions adopted at the conference of all parties have been universally implemented. Another issue is that of capital accumulation. During the Copenhagen conference, developed countries pledged to provide US$100 billion per year to support climate action in developing countries by 2020. We hope the developed countries will take the lead in reducing emissions and that the Doha Amendment to the Kyoto Protocol will take effect. Meanwhile, we will review if developed countries have honored their commitments regarding that figure of US$100 billion in annual aid, so as to lay a foundation for further implementation of the Paris Agreement beyond 2020 and achievement of the long-term goal of addressing climate change.

Thank you.

CNN:

As you said in an interview with me before the 2015 Climate Conference in Paris, the international community does not need to worry about China's resolve and policies on climate change, but of those of the United States. You said back then the U.S. might change its policies if a Republican president was elected in the 2016 election. Unfortunately, you called it right. My question, then, is after the Trump administration announced withdrawal from the Paris Agreement, what changes have occurred to China's performance on the global issue? Will China play a greater role? Some people worry that the Chinese government will loosen its environmental protection measures on greenhouse gas emission reduction. What's your comment on that?

Xie Zhenhua:

In international conferences, there are often some people raising this question. First of all, the U.S. is a very important country in the field of climate change. It is fair to say that the cooperation between China and the U.S. made a very important contribution to the forming, signing and putting the agreement into effect. However, President Donald Trump decided to leave the accord after assuming his post. Originally, the international situation regarding the fight against climate change, through win-win, multilateral cooperation, was very good. However, the political influence of the American withdrawal was quite big. At least, it affected the resolve and confidence of some other countries to some extent at first. However, that influence soon dissipated. It is known that China and the U.S. play important roles in responding to the climate issue. So, President Xi Jinping said twice at the U.N. headquarters in Geneva and at an international conference that China would resolutely carry out the Paris Agreement, and not give up the hard-won achievements of the accord. China will firmly carry out the Paris Agreement and take proactive measures. Particularly, China has clearly announced that it will completely fulfill its promises. China has sent out such a strong political signal, which helps stabilize the international efforts to cope with climate change. I attend all kinds of international meetings in the field of climate change, and all countries express their resolve to carry out the Paris Agreement, and all of them promise to implement the agreement earnestly. So, the withdrawal of the U.S. from the agreement had some influence at first, but that influence has since become weaker.

The United States has an important role in reducing emissions, and had promised to provide US$3 billion in finance for the Green Climate Fund (GCF). Therefore, the rest of the world is deeply concerned about its withdrawal, which creates a massive void up front, including a huge funding gap . However, in September, I visited California as a co-chairman of The Global Climate Action Summit (GCA) and was encouraged that at least 17 American states pledging to follow the previous commitments made by the U.S. government, and all have already taken positive actions. There are also some philanthropists who have announced willingness to make up the amount if the U.S. government refuses to pay what it pledged. It should be said there are still positive factors in American society in dealing with climate change. This year, we have seen that extreme weather does not only affect developing countries, but also developed countries, exemplified by the forest fires that recently engulfed California. There has, already, been an enormous impact, with substantial losses. Therefore, I believe that, in dealing with climate change, all countries are showing a willingness to work together, help each other, and do their utmost in accordance with the principle of common but differentiated duties. It can be said that the entire process is still relatively stable. Why is that? It is because in dealing with climate change, humanity has recognized it must transform and innovate the existing growth models and embrace a low-carbon approach – a tendency of which we are all increasingly aware. So I believe this trend is unstoppable.

On the role of China, President Xi Jinping has publicly pledged that we will deliver 100 percent of our commitments. It is not just a matter of honoring our commitments, President Xi's active response to climate change is not a thing that the others have asked us to do, but is out of our own motivations. This is an inherent requirement for China's sustainable development. It is also our responsibility, as a major developing country, to protect humanity and the earth. In this sense, China will remain resolute and proactive in combating climate change and carrying out the Paris Agreement, regardless of the position and attitudes of other countries. Many have asked about the progress that China has made in combating climate change. The following are some figures. China had pledged that by 2020, it would cut its carbon intensity by 40 to 45 percent from 2005 levels. China also pledged to increase the share of non-fossil fuels in primary energy consumption to around 15 percent and increase its forest reserves by 1.3 billion cubic meters. By the end of 2017, China's carbon intensity had already fallen by 46 percent, meaning that it has achieved its goal three years ahead of schedule. Renewable energy already accounts for 13.8 percent of primary energy consumption and will surely meet the goal of 15 percent by 2020. Our forest reserves have increased by 2.1 billion cubic meters, exceeding our targets for 2020. The realization of these targets has laid a very solid foundation for achieving peak carbon dioxide emissions in 2030. I am confident that we will fully live up to our commitments and strive to do even better. The difficulties and challenges encountered will not change our goals and determination.

In addition, the action that China has taken to address climate change has also promoted high-quality development. I have mentioned several figures that can demonstrate its intensity and share internationally. We set up goals on energy conservation and emission reduction to reduce carbon intensity. According to figures released by the World Bank, China has contributed to over 50 percent of the conserved energy globally since 2005. Renewable energy in China has the largest scale in the world with the installed capacity totaling 0.65 GW, accounting for 28 percent of the global total. Over the last five to six years, China has led the world in investments in renewable resources resulting in the lowering of the cost of photovoltaic and wind power generation, which is a great contribution to the world.

In addition, regarding forestation. China has the largest plantation area and a forest coverage rate reaching 22 percent. We have already reached the goal of forest stock for the year of 2020.

China has launched a national carbon trading market, maybe the world's largest, with the amount of carbon emissions totaling 3 billion tons. In comparison, the EU has achieved a market of only 1.7 billion tons, although it has been engaged in work on a carbon market for many years.

As President Xi Jinping has announced, China has established the South-South Climate Cooperation Fund to promote cooperation among developing countries.

So far, China has signed memoranda of cooperation with 34 countries, presenting them goods and materials to cope with climate change. We have trained nearly 1,000 officials and researchers from over 100 developing countries to improve their abilities in raising capital and combating climate change.

China has embarked on a road pursuing low-carbon development. The international community agrees that China's progress in combating climate change has great reference significance for other countries.

All the above aspects I have mentioned are China's policies, actions and progress for addressing climate change, and showing it is playing an important role on the global stage. Thank you.

Reuters:

I wanted to ask whether there is any possibility that China will consider increasing its target of emissions reduction. So, low emissions reduction by 2020, or 2030, as you said earlier, China is on the target to meet the 2020 suggested amount agreed at Paris, but increasingly given new reports like the IPCC 1.5℃ report and pressure growing on the European Union to consider reducing its target, I wonder whether China is also considering that, under what conditions it might reduce its emissions target. Thank you.

Xie Zhenhua:

The IPCC recently made a special report on the impacts of global warming of 1.5 °C above pre-industrial levels. This report shows that the dangers and impacts of climate change have already happened, and the response to climate change is becoming more and more urgent. It gives us such a clear signal and offers various options. Therefore, Chinese scientists have made great contributions in this regard.

The report put forward that measures must be taken with intensified efforts to limit warming to below 2 °C or 1.5°C above pre-industrial levels. And the time is running out. For China, we should accomplish the goals we have already made and strive to do better. For example, as I said just now, two of our 2020 goals have been achieved, and we will continue to work tirelessly to improve this aspect and do a good job. Because doing a good job aims not only to deal with climate change, but also provide an incentive to promote the high-quality development of our domestic economy and society. Therefore, the international community does not need to doubt this, and we will do it seriously.

We hope that developed countries will earnestly honor their commitments. The Paris Agreement enshrines the principle that actions and support must be matched. Actions refer to both mitigation actions and adaptation actions, while support refers to the financial and technical support provided to developing countries by developed countries. As long as the developing countries are provided with financial and technical support to improve their capabilities in all aspects, it is possible for them to take proactive measures. In this sense, therefore, we hope that during the implementation of the Paris Agreement, in the negotiation process of the implementation rules, and in the process of mapping out the future institutional arrangements, the provisions of the Paris Agreement should be seriously implemented, so that all countries in the world can truly establish political mutual trust and take active action to achieve the goals through international cooperation while addressing climate change at different stages. Thank you.

China Daily:

Could you please give us an introduction to the overall construction progress of the national carbon emissions trading market and the plan for the follow-up work? Thank you.

Xie Zhenhua:

This work is organized and promoted by the Climate Change Department, the Ministry of Ecology and Environment. I would like to invite Mr. Li to give you some information on that.

Li Gao:

Thank you. It is a major institutional innovation to establish a nationwide carbon emissions trading market in a bid to control greenhouse gas emissions through the market mechanism. It is also an extremely complicated and systemic-based project. We have set up carbon trading pilot schemes in seven provinces and cities since 2011, analyzing relevant experiences as part of the groundwork for establishing a nationwide and integrated carbon emissions trading market. Generally speaking, these pilot schemes have made good progress since trading began in June 2013, with total transactions reaching 270 million tons of carbon dioxide and the trading volume surpassing 6 billion RMB. In the regions that have introduced pilot schemes, the total amount of carbon emissions as well as carbon intensity have both decreased. Thus, the carbon emissions trading market has indeed been significant for meeting our target of controlling greenhouse gas emissions and promoting regional low-carbon development.

On the other hand, we are still learning from the developed countries. As Mr. Xie has mentioned, China is not the first country to establish a carbon emissions trading market. Over the past few years, we have proactively learnt from and drawn on the lessons of the experiences of the E.U. as well as the state of California, making them an important reference in the design of our carbon emissions trading market. We released "The Development Plan of the National Carbon Emissions Trading System (Power Generation Sector)" at the end of 2017, which marked the launch of the carbon emissions trading system (ETS). After that, we have carried out a series of activities and kept advancing the work in regard to reporting, examining and checking carbon emissions in 2016 and 2017. We have made significant progress by proposing an initial design plan for the registration and trading systems, both of which are crucial for development of the ETS. We have also carried out a lot of work in the power generation sector, the first to implement carbon emissions trading, such as the design of carbon quota distribution and the compilation of training materials. In September, the Ministry of Ecology and Environment held a mobilization meeting and carried out large-scale training to ensure the preparation of the power generation sector as the first to join the national carbon ETS. We will continue to advance the relevant work by firmly upholding the principle of considering the carbon ETS as our policy tool in controlling greenhouse gas emissions. It is an important original intention to establish the carbon ETS.

We will steadily advance the phased building of the carbon trading market. After the power generation industry, we will gradually involve more industries and various related parties in carbon emission rights trading and enrich the trading category. During this process, we will be cautious to avoid adverse speculation and over-financialization. We also seek to prevent financial risks and make full use of the carbon market to both reduce greenhouse gas emissions and save related costs.

We will step up the building of the carbon trading market in the following four aspects: First, issuing regulations and supporting rules. Together with relevant departments, we will further advance the adoption of the temporary regulation on the carbon emission rights trading, fundamental to market operation. We will later issue some supporting rules, all of which are currently in the drafting process.

Second, we will boost necessary infrastructure development. So far, the enterprise direct reporting system has taken shape, but needs improvement. We have formed preliminary plans for the registration and trading systems, and we intend to waste no time in their argumentation and optimization.

Third, better managing the work related to quota allocation and verification of the carbon emission reports of key emitters. Next year, we will verify the reports submitted in 2018. Besides, we will exert more efforts in nourishing third party verification agencies. As for the power generation industry, we will issue a guidebook on its quota allocations and encourage spreadsheet making with the guidebook in enterprises. This will enhance the statistical foundation and ensure the quota allocation plan better matches practice.

Fourth, strengthening capability building. Ecological authorities and other related government agencies and organizations should all acquire necessary capacities. Local ecology authorities will have a role to play in managing the carbon trading market, and they need to do more in personnel training and capability building. We have been proactively pushing ahead with technique preparations since the nation launched the carbon trading system in late 2017.We will work harder and try to realize trading as soon as possible. Thank you.

Associated Press:

I would like to ask about China's policy in terms of climate change in the context of the Belt and Road Initiative project. Chinese institutions have been investing heavily in coal projects overseas, and this has raised concern among environmentalists in particular for the Belt and Road project. So, I was wondering if there might be any measures to compensate for the carbon emissions that might increase due to these projects for the Belt and Road.

Xie Zhenhua:

A large part of the Belt and Road cooperation is infrastructure development, which features a lock-in effect, meaning that long-term carbon emissions are mostly determined by the technologies, materials and standards the project adopted at its initiation. When proceeding with the Belt and Road development, the Chinese central government has been very clear that all the construction projects should be green and follows a low carbon path. Therefore, all the projects will adopt the latest technologies, save resources and energy as much as possible, and ensure the best performance in emissions reduction. Our existing standards on energy conservation and climate change reduction should also be adopted for both industrial and non-industrial programs. Moreover, the programs can also use as reference world-leading standards on climate change adaption in order to promote local development and cut emissions at the same time.

We have arranged several "South-South Cooperation" programs with countries along the Belt and Road to help increase their capacity to cope with climate change and also initiated some public welfare programs to help protect the local environment. When proceeding with Belt and Road development, we will strive to ensure the way forward is green and follows a low carbon path.

Both developed and developing countries are now wondering if their measures to cope with climate change will affect the local economy and employment. However, based on Chinese practices in tackling climate change, those worries might be unnecessary. I will give you some figures to showcase how China is following a transformative path in tackling climate change.

From 2005 to 2017, the GDP grew 1.8-fold, during which time the country lifted 170 million people out of poverty. Measures for energy conservation, emissions reduction and environmental protection have also created new employment opportunities and new industries. During the period, we have created over 30 million jobs. Those measures have also improved national performance in dealing with environmental pollution, which is beneficial to public health. Therefore, the measures have promoted high quality economic growth, improved people's wellbeing, and protected their health. Our green and low carbon practices will also be introduced to the Belt and Road countries, seeking to avoid the old development pattern of "pollution first, treatment afterwards" that developed countries followed in their industrialization. We have suffered losses in that process and do not want to see countries along the Belt and Road facing the same consequences. Therefore, we will strive to follow a low carbon path and build a green Belt and Road. Thank you.

Guangming Daily:

How will China push forward with its efforts to address climate change after the government institutional reform? What will be the focus? Thank you.

Xie Zhenhua:

Mr. Li has first-hand knowledge, since he was transferred from the National Development and Reform Commission (NDRC) to the Ministry of Ecology and Environment. I'll give the floor to him.

Li Gao:

In this round of government institutional reform, the function of addressing climate change was transferred to the newly-established Ministry of Ecology and Environment. This is a major institutional arrangement made by the CPC Central Committee and the State Council to address climate change and prevent and control pollution in a more coordinated way, as well as pursue ecological and environmental protection more holistically. We will advance China's efforts to address climate change under new circumstances. President Xi Jinping delivered an important speech at a national conference on environmental protection in May, which Mr. Xie also mentioned just now. We will ensure the full implementation of the requirements made by President Xi. Addressing climate change, which involves various fields, is beyond the capabilities of one single institution. This function was transferred from the NDRC to the Ministry of Ecology and Environment. But it does not mean that all the duties for addressing climate change were or are assumed by the NDRC or the Ministry of Ecology and Environment. The structure of the national leading group on climate change can serve to illustrate the point. Headed by the Chinese premier, the group has members from almost all the institutions. It enables all the institutions to perform their duties and play their roles in a more coordinated way, thus enhancing the effect of related policies.

We have an important task recently to establish a new departmental coordination mechanism under the leadership of the leading group to further coordinate the work between the departments. Through long-term practice, China has formed a working pattern in the field of addressing climate change: the leading group exercises unified leadership over the work, the competent department of climate change (now the Ministry of Ecology and Environment) is responsible for the coordination, all the relevant departments cooperate and support each other, and local departments and various industries fully participate in the field of addressing climate change. Next, we will make such a work pattern play a better role. In addition to maintaining the coordination mechanism at the departmental level, we also need to promote the establishment of provincial-level leading groups and related coordination mechanisms to give impetus to local work, in accordance with the requirements of the State Council after the transfer of local institutions has been completed.

I mentioned earlier that under the new situation it is important to integrate and synergize the work of tackling climate change with environmental pollution prevention and treatment and ecological protection. So next, we will accordingly focus on the better coordination and synergy in addressing climate change and ecological environment protection. In the future, from monitoring to target setting, policy and plan formulating, then to related supervision and implementation in tackling climate change, we should better coordinate our work with environmental pollution control and ecological protection. China has set a medium and long-term goal in addressing climate change, and there is a very practical supervision and implementation mechanism in the field of ecological environment protection. Therefore, how to use such a good mechanism to serve the national goals will be the next focus for the Ministry of Ecology and Environment in addressing climate change.

Of course, tackling climate change involves both international and domestic aspects. At the international level, Xie Zhenhua, special representative for climate change affairs of China, has just introduced that we will continue to work with all parties in a positive and constructive manner to foster a global governance system that is fair, reasonable, and focused on win-win cooperation, unswervingly promote the multilateral system for addressing climate change, and unswervingly promote the full and effective implementation of the United Nations Framework Convention on Climate Change (UNFCCC）and the Paris Agreement. This year's negotiations are very important. We will spare no effort in working with all parties to ensure advances in the development of the Paris Agreement implementation rules, so as to lay a good institutional foundation for post-2020 global cooperation in tackling climate change. We will also demonstrate the effectiveness of the multilateral system in addressing the challenges of global climate change through such an outcome.

There are also some other tasks. Since we have put forward the nationally determined action objectives on climate change by 2020 and 2030, we will advance implementation of our enhanced actions and promote some key areas and industries to independently roll out their own plans and roadmaps in view of nationally determined contributions and exert more efforts to ensure achieving the national targets . At the same time, we should take into account the specific conditions beyond 2030, the actual conditions of our national development, the needs to address climate change, and the two-stage development plan for building China into a great modern socialist country put forward at the Nineteenth National Congress of the Communist Party of China, so as to further determine the long-term objectives and tasks of tackling climate change. These are all very important tasks for us in the next stage.

In addition, there is another very important task in the field of climate change. Just now, I have answered the reporter's question on it, that is, to speed up the construction of the national carbon emission trading market. Thank you.

China Review News:

In the upcoming G20 summit to be held in Argentina, what suggestions will China put forward on climate change? Thanks.

Xie Zhenhua:

The framework convention on climate change plays a fundamental role in the international response to the problem. Prior to the Katowice Climate Change Conference, world major economies are to gather in Buenos Aires, Argentina, for the G2O summit [opening this Friday]. The attending countries and international organizations have important influence in both economic development and climate change. So, we hope that they will send out a clear message on implementation of the Paris Agreement and the U.N. 2030 Agenda for Sustainable Development, which will provide more impetus to the Katowice Climate Change Conference. Argentina has always played an active part in tackling climate change, as do the most of the countries attending the summit. So, I believe that there will be more actions on combating climate change, as well as a successful holding of the Climate Change Conference at the end of this year.

Xi Yanchun:

Thanks for Mr. Xie and Mr. Li. Thank you all. That marks the end of the press conference.

Read in Chinese

Date:

Oct. 19, 2018

Hu Kaihong: 

Ladies and gentlemen, good morning. Welcome to this press conference. Today, we have invited Mr. Mao Shengyong, spokesperson of the National Bureau of Statistics, to introduce China's economic performance of the first three quarters of 2018. He will also answer some of your questions.  

Now, Mr. Mao will give you a brief introduction. 

Mao Shengyong:

The Chinese economy has, on the whole, maintained stable in the first three quarters with deepened transformation and upgraded development.

During the first three quarters, the country was confronted with a rather complex international situation as well as formidable tasks of domestic reform and development. Under the strong leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, all regions and departments implemented the decisions and arrangements made by the CPC Central Committee and the State Council, firmly adopted a new development philosophy, actively worked in line with the standards and requirements for high quality growth through deepened supply-side structural reform, and strived for coordination in maintaining stable growth, advancing reform, promoting structural adjustment, improving people's well-being, and guarding against risks. As a result, the national economy has maintained generally stable while achieving steady progress. The economic structure has continued to be upgraded; old growth drivers have been constantly replaced by new ones; the development quality and performance has steadily improved, and high quality growth has been achieved.

According to preliminary statistics, GDP in the first three quarters was 65.09 trillion yuan (US$9.38 trillion), up 6.7 percent year on year in comparable prices. On a quarterly basis, the year-on-year increase was 6.8 percent, 6.7 percent and 6.5 percent respectively. In regard to the different industrial sectors, the added value of the primary, secondary and tertiary industries reached 4.22 trillion yuan, 26.30 trillion yuan and 34.58 trillion yuan respectively, up 3.4 percent, 5.8 percent and 7.7 percent year on year.

1. The agricultural sector posted stable performance with an improved planting structure.

The total output of summer grain was 138.72 million metric tons, a drop of 3.06 million metric tons, or a year-on-year decrease of 2.2 percent. The total output of early rice was 28.59 million metric tons, down 1.28 million metric tons, or 4.3 percent year on year. We expect a bumper yield in Autumn grain. With an upgraded structure, planting areas for quality rice, soybeans, cotton and sugar increased, while the corn planting area decreased. In the first three quarters, the total output of pork, beef, mutton and poultry reached 60.07 million metric tons, up 0.2 percent year on year, among which the figure for pork was 38.43 million metric tons, up 0.3 percent. There were 428.87 million live pigs, a year-on-year decrease of 2.3 percent, while 495.79 million pigs were slaughtered, a year-on-year increase of 0.1 percent.

Mao Shengyong:

2. Production in both the industrial and service sectors is generally stable, and corporate profits registered relatively fast growth. 

In the first three quarters, the added value of industrial enterprises above designated size increased by 6.4 percent year-on-year, although this was down 0.3 percentage points from the level recorded in the first half of the year. In terms of economic types, the added value of State-owned enterprise increased by 7 percent year-on-year, that of collectively owned enterprises decreased by 1.4 percent, that of joint-stock enterprises rose by 6.6 percent and that of foreign-invested companies and Hong Kong-, Macao- and Taiwan-invested companies grew by 5.7 percent.

In the three major categories, the added value achieved by the mining industry increased by 1.8 percent year-on-year, that of the manufacturing industry increased by 6.7 percent, while that in the sectors of electricity, heat, gas and water production and supply grew by 10.3 percent. In September, the added value of industrial enterprises above designated size rose 5.8 percent year-on-year. In the first three quarters, the index of services production increased by 7.8 percent year-on-year, 0.2 percentage points lower compared to the level achieved in the January-June period, with information transmission, software and information technology services, and leasing and business services growing by 37.5 percent and 10.8 percent, respectively. 

In September, the index of services production grew by 7.3 percent year-on-year. During the January-August period, the combined profits of industrial enterprises above designated size stood at 4.42 trillion yuan, a year-on-year increase of 16.2 percent; the profit margin in regard to the main business income of industrial enterprises above designated size was 6.43 percent, up 0.35 percentage points year-on-year. During the January-August period, the operating revenues and operating profits of service sector enterprises above designated size respectively rose by 12 percent and 15.5 percent year-on-year.

3. Market sales kept increasing, while consumer spending increased at a faster speed.

In the first three quarters, total retail sales of consumer goods reached 27.4299 trillion yuan, a year-on-year increase of 9.3 percent. This was 0.1 percentage point lower than the figure for the first half of this year. Specifically, retail sales in urban areas reached 23.4717 trillion yuan, up 9.1 percent, while sales in rural areas totaled 3.9582 trillion yuan, up 10.4 percent.

Grouped by consumption patterns, revenue from the catering sector totaled 2.9763 trillion yuan, up 9.8 percent, while revenue from commodities rose 9.2 percent to 24.4536 trillion yuan. Sales of goods for a consumption upgrade grew at a faster rate. Of commodities above the limitation unit, the total retail sales of gasoline and related products rose 14.4 percent, and that of communication products rose 10.7 percent. This represented gains of 5.4 percentage points and 1.4 percentage points respectively from the same period of last year. 

In September, the total retail sales of consumer goods increased by 9.2 percent year-on-year, 0.2 percentage point faster than the previous month. In the first three quarters, residents' per-capita consumption spending was 14,281 yuan, representing nominal growth of 8.5 percent year-on-year, 1.0 percentage point faster than the same period of last year, and an actual growth of 6.3 percent, 0.4 percentage point faster year-on-year after adjusting for inflation. Specifically, urban residents' per-capita consumption spending was nominally up by 6.5 percent, 0.3 percentage point higher year-on-year. For rural residents, there was a nominal gain of 12.0 percent, 3.4 percentage points higher than last year. 

Mao Shengyong:

4. Investment on fixed assets slowed and became more stable; private and manufacturing investment achieved an apparent increase.

During the first three quarters, nationwide fixed assets investment (except for peasant households) totaled 48.34 trillion yuan, up 5.4 percent year on year, the growth rate being 0.6 percentage points lower than in the first half of the year, but 0.1 percentage points higher when considered from January to August. Among the relevant figures, private investment reached 30.17 trillion yuan, up 8.7 percent year on year, with the growth rate 0.3 percentage points higher than in the first half year and 2.7 percentage points higher than the same period of last year. Viewed from an industrial sector perspective, investment in primary and secondary industries increased 11.7 percent and 5.2 percent respectively. Manufacturing investment grew 8.7 percent, 1.9 percentage points higher than in the first half of the year, and the increasing momentum has been maintained for the past six months. Investment in the tertiary sector increased 5.3 percent, while that for infrastructure grew 3.3 percent. During the same period, investment for real estate development totaled 8.87 trillion yuan, up 9.9 percent year on year. The area involved in commercial housing sales totaled 1.19 billion square meters, up 2.9 percent year on year and the sales volume reached 10.41 trillion yuan, a year-on-year gain of 13.3 percent. 

Mao Shengyong:

5. Export growth rate accelerated and imports increased remarkedly.

In the first three quarters, imports and exports of goods totaled 22.28 trillion yuan, a year-on-year increase of 9.9 percent. The growth rate was 2.1 percentage points higher than in the first half of the year. Breaking the figures down, Chinese exports reached 11.86 trillion yuan, a year-on-year gain of 6.5 percent, the rate being 1.8 percentage points higher than that in the first half of the year. Meanwhile, imports increased 14.1 percent to 10.43 trillion yuan, 2.5 percentage points higher than in the first half. The foreign trade surplus shrank 28.3 percent year-on-year to 1.43 trillion yuan. Imports and exports involving our major trade partners have all seen increases, being up 7.3 percent, 6.5 percent and 12.6 percent respectively to the EU, the United States and the ASEAN. In addition, exports to and imports from some key countries involved in the Belt and Road Initiative maintained sound growth momentum, with increases of 19.4 percent, 11.9 percent and 11.8 percent respectively to Russia, Poland and Kazakhstan. In September, the total volume of imports and exports reached 2.89 trillion yuan, up 17.2 percent year-on-year. Exports increased 17.0 percent to 1.55 trillion yuan while imports increased 17.4 percent to 1.34 trillion yuan. In the first three quarters, the delivery value of exports of industrial enterprises above designated size reached 8.97 trillion yuan, up 8.1 percent year-on-year. The September figure was 1.18 trillion yuan, up 11.7 percent year-on-year.

Mao Shengyong:

6. The Consumer Price Index (CPI) saw mild growth, the Producer Price Index (PPI) rose steadily.

In the first three quarters, the national CPI rose 2.1 percent year-on-year, 0.1 percentage point higher than in the first half of the year. By category year-on-year, food, tobacco and liquor prices rose 1.6 percent, clothing prices 1.2 percent, residences 2.4 percent, household facilities, articles and services 1.6 percent, transport and communications 1.7 percent, education, culture and entertainment 2.2 percent, health care 5.0 percent, and other goods and services 1.1 percent. In September, the national CPI rose by 2.5 percent year-on-year, an increase of 0.2 percentage point over August, while the figure was up 0.7 percent month-on-month.

In the first three quarters, the national PPI rose 4.0 percent year-on-year, 0.1 percentage point higher the growth rate witnessed in the first half of the year. The national purchasing prices for industrial producers grew 4.5 percent year-on-year. In September, the PPI rose 3.6 percent year-on-year, 0.5 percentage point lower than the figure for August and the index rose 0.6 percent month-on-month. The national purchasing prices for industrial producers rose 4.2 percent year-on-year and 0.6 percent month-on-month.

Mao Shengyong:

7. The employment situation remained stable, with the surveyed urban unemployment rate declining.

The surveyed urban unemployment rate was 4.9 percent in September, 0.1 percentage point lower than both in August and in the same period of last year. The surveyed urban unemployment rate in 31 large cities was 4.7 percent in September, 0.2 percentage point and 0.1 percentage point lower than in August and the same period last year respectively. The surveyed unemployment rate for the major workforce aged 25 to 59 was 4.3 percent, unchanged from the previous month. By the end of the third quarter, the number of rural laborers forming the migrant work force had reached 181.35 million, 1.66 million more than the same period last year, for a gain of 0.9 percent. The average monthly income of migrant workers was 3,710 yuan, up 7.3 percent year-on-year.

8. The increase in personal income kept pace with economic growth, while the ratio of urban to rural income decreased.

In the first three quarters, personal per capita disposable income totaled 21,035 yuan, an increase of 8.8 percent year-on-year in nominal terms, and 6.6 percent in real terms taking price factors into account. The real increase remained the same as that in the first half of this year, keeping pace with economic growth. Factoring for permanent residence, urban and rural per capita disposable income totaled 29,599 and 10,645 yuan respectively, with the nominal growth rates reaching 7.9 percent and 8.9 percent respectively, while real growth was 5.7 percent and 6.8 percent respectively after taking account of price factors. The ratio of urban to rural per capita disposable income was 2.78, a reduction of 0.03 compared to the same period of the previous year. The median figure for national per capita disposable income was 18,236 yuan, an increase of 8.7 percent year-on-year in nominal terms.

9. The industrial structure has been further improved and the fundamental role of consumption has been continuously enhanced.

The upgrading of industries has continued to progress. In the first three quarters, the value-added growth rate of the tertiary industry was 1.9 percentage points faster than that of secondary industry. It accounted for 53.1 percent of the GDP, an increase of 0.3 percentage point compared to the same period last year, and 12.7 percentage points higher than the secondary industry. 

The fundamental role of consumption has been continuously strengthened. In the first three quarters, the contribution rate of final consumption spending to economic growth was 78.0 percent, 46.2 percentage points higher than the contribution from gross capital formation. 

The proportion of service consumption continued to increase. In the third quarter, service consumption accounted for 52.6 percent of the national residents' consumption spending, an increase of 0.2 percentage point year-on-year.

The investment structure has achieved continuous optimization. In the first three quarters, investments in the high-tech manufacturing industry increased 14.9 percent on a yearly basis. The growth rate was 9.5 percentage points higher than overall investment.

The trade structure has been further improved. In the first three quarters, the general trade of imports and exports increased by 13.5 percent, accounting for 58.4 percent of the overall total, up 1.9 percentage points year-on-year. The export of mechanical and electrical products increased by 7.8 percent, or 58.3 percent of total exports.

10. The effects of supply-side structural reform have continuously showed and new drivers of growth have developed fast.

The industrial capacity utilization rate has remained stable. In the first three quarters, the national industrial capacity utilization rate was 76.6 percent, identical with last year. In the third quarter, the capacity utilization rates of the ferrous metal smelting and rolling processing industry and the coal mining and washing industry reached 78.7 percent and 70.1 percent respectively, 2.0 and 1.1 percentage points higher year-on-year.

Enterprise operational costs and their leverage ratio have dropped. From January to August, the cost per 100-yuan of main business revenue of industrial enterprises above designated size was 84.39 yuan, 0.35 yuan less than last year. At the end of August, the liability-asset ratio of industrial enterprises above designated size was 56.6 percent, down 0.5 percentage point year-on-year. 

The stocks of commercial buildings for sale have continued to decrease. At the end of September, the total floor space of commercial buildings for sale dropped by 13.0 percent year-on-year.

More investments have been made in key industries to address inadequacies. In the first three quarters, the investment in ecological preservation and environmental treatment and agriculture grew year-on-year by 33.7 percent and 12.4 percent respectively, 28.3 and 7.0 percentage points faster than the average growth of total investments in all fields respectively.

Green development has advanced steadily. In the first three quarters, the energy consumption per unit of gross domestic product dropped by 3.1 percent year-on-year.

New industries have enjoyed comparatively fast growth. In the first three quarters, the added value of high-tech manufacturing and equipment manufacturing industries increased year-on-year by 11.8 percent and 8.6 percent respectively, 5.4 and 2.2 percentage points faster than industrial enterprises above designated size. The added value of emerging strategic industries increased by 8.8 percent year-on-year, 2.4 percentage points faster than that of industrial enterprises above designated size.

New products have continued to be developed rapidly. For example, in the first three quarters, the output of new energy vehicles increased by 54.8 percent year-on-year and that of integrated circuits 11.7 percent.

New forms of businesses have developed vigorously. In the first three quarters, online retail sales totaled 6.28 trillion yuan, an increase of 27.0 percent year-on-year. Among them, online retail sales of physical goods reached 4.79 trillion yuan, up 27.7 percent and  accounting for 17.5 percent of the total retail sales of consumer goods. This represented an increase of 3.5 percentage points over the previous year. Online retail sales of non-physical goods reached 1.48 trillion yuan, an increase of 24.8 percent.

Generally speaking, in the first three quarters, the Chinese economy operated within an appropriate range. Economic performance was stable, with improved momentum; the economic structure was further adjusted. The quality of development continued to improve. More efforts were made to promote reform and opening up, and the public enjoyed more benefits from development.

Meanwhile, there were several issues to be noted: We were confronted with more external challenges. The difficulties in adjusting the domestic economic structure remained. Despite a stable performance, the national economy was confronted with possible changes and greater downward pressures. 

As far as the next step is concerned, we will focus on promoting high-quality development and continue the reform and opening-up campaign. In the current supply side structural reform, the key task will be to address certain inadequacies. We seek to expand effective market demand. We will ensure a stable development of the job market, the financial market, the foreign trade sector, the foreign capital sector and the investment sector, and keep overall expectations stable. We will promote stable and healthy economic development. And we will be able to achieve the main economic and social development targets set for this year.

Hu Kaihong:

Thank you Mr. Mao. Now, the floor is open to questions. Please identify the media outlet you represent before asking questions.

CCTV:

As you said, the growth of GDP and some industrial indicators fell to some extent. Does it mean the economy faces many difficulties? And how would you comment on the current economic situations? Thanks. 

Mao Shenyong:

I would like to summarize the economic operation over the first three quarters into three points.

First, stability has been maintained. From the perspective of growth, over the first three quarters, GDP grew 6.7 percent year-on-year, laying a solid foundation for the realization of the objective of an annual growth rate of around 6.5 percent. From the perspective of employment, the nationally-surveyed urban unemployment rate in September was 4.9 percent, 0.1 percentage points lower than the previous month and also September 2017. More than 11 million new urban jobs were created, which means the annual job creation task has been completed a quarter in advance. From the price perspective, the CPI grew by 2.1 percent over the first three quarters, 0.1 percentage points higher than the level in the first two quarters. However, the growth of CPI over the first three quarters remained 2.0 percent, the same as the level achieved in the first half of this year, if the price rises of food and energy is not taken into account. From the perspective of residents' income, the average disposable personal income over the first three quarters increased 6.6 percent, the same figure as was established in the first half of this year, basically keeping pace with national economic growth. So, considering the indices of growth, employment, price and income, it is fair to say that the economy is operating stably in a rational zone.

Second, the momentum of progress has been maintained. The economic structure is going through a process of optimization and adjustment. As has been noted, from the perspective of industrial structure, the service sector's role as the bedrock has been consolidated. Over the first three quarters, the value-added achievements of the service industry increased by 7.7 percent, which is comparatively fast growth, contributing 60.8 percent of economic growth, 1.8 percentage points higher than the same period of last year. Over the first three quarters, the service industry's share in GDP was 53.1 percent, 0.3 percentage points higher than last year. Besides, the sector's progress to a medium- and high-level has speeded up. The changes of the structure of demand indicate that the foundational role of consumption has been continuously strengthened. Over the first three quarters, consumption contributed to 78 percent of economic growth, 14 percentage points higher year on year. The structure of investment has improved as well, with the growth of investment in manufacturing rising for six straight months, while private investment growth has remained above eight percent. Meanwhile, the quality and efficiency of the economy have also been improving. 

Third, new driving forces are becoming stronger far more quickly. The supply-side structural reform has advanced solidly; the upgraded version of mass entrepreneurship and innovation initiatives is taking shape; new driving forces are developing fast. The number of market entities has increased by a large margin. Over the first three quarters, the number of newly registered enterprises exceeded five million, which translates to more than 18,000 new businesses every day. New industries develop fast. The growth of value added of the high-tech industries, equipment manufacturing industries and emerging industries of strategic importance, among the medium- and large-scale enterprises, respectively hit 11.8 percent, 8.6 percent and 8.8 percent, markedly higher than other industries. New types of industries are obviously prospering. The value of online retail sales of physical commodities increased by 27.7 percent, for instance. The development of new driving forces has gathered momentum for the optimizing of economic structure and steady economic operation.

In brief, the economy is operating within a rational range. The long-term stable and progressive fundamentals of the economy will continue. Meanwhile, it is known that the external environment has obviously changed, and the stable economic growth has slowed down slightly. We will act according to the policies made by the central authorities to ensure stable development of the job market, financial markets, foreign trade, foreign capital sector and the investment sector, so as to ensure the stability and health of economic growth. 

Phoenix TV:

China's GDP growth in the third quarter fell to 6.5 percent, the lowest in the last nine-and-a-half years. We are concerned whether the growth rate will continue to fall? You just mentioned that the downward pressure is increasing. How much more pressure can be expected?

Mao Shengyong:

Judged by macro indicators such as the GDP growth rate, employment, commodity prices, incomes and the balance in international payments, the Chinese economy maintained stability while making steady progress in the first three quarters. However, we noticed some uncertainties concerning economic growth, such as that of the external environment. In the first three quarters, the momentum in world economic growth slowed down, as did expansion of world trade. Some new economies encountered many difficulties. Recently, we can see the international financial market has experienced obvious fluctuation. China has become the second largest economy in the world, which has become increasingly integrated with the world economy. At present, uncertainties of the world economy are increasing, and there are also uncertainties resulting from China-U.S. trade friction. As a result, the Chinese economy is facing downward pressure due to those uncertain factors.

However, there are many certain factors in China. The economy shows strong resilience and many positive fundamentals. We will continue to deepen reform and opening-up so as to continuously release dividends. All departments in all regions should strengthen their implementation of policies to ensure stable development of the job market, financial markets, foreign trade, foreign capital sector and the investment sector, so as to ensure overall expectations remain stable. The intended effect of such policies will be unleashed gradually. Therefore, although we are facing external uncertainties, we will maintain stable growth of the Chinese economy as the domestic certainties somewhat offset external uncertainties. 

Economic Daily: 

We notice the total retail sales of consumer goods increased by 9.3 percent during the January-September period, lower than the growth rate of 10.4 percent during the same period last year. It can be said that there is an obvious slowdown in consumption growth. Recently, there are also a lot of public discussion on whether China is witnessing a consumption downgrading. Mr. Mao, how would you comment on this? Thank you. 

Mao Shengyong: 

When talking about changes in consumption on a month to month basis, we usually use the total retail sales of consumer goods to measure the market consumption situation. Fluctuations in the growth rate of this indicator in the last few months have caused some public discussion. 

We can analyze consumption changes from multiple perspectives as we gather more quarterly statistics. For instance, when looking at overall volume, the total retail sales of consumer goods increased by 9.3 percent in the January-September period, with the volume in September being 0.2 percentage points higher than August. A growth rate above nine percent can be considered as relatively fast. 

In terms of per capita consumption expenditure of Chinese households, the nominal growth reached 8.5 percent in the first three quarters, up one percentage point year-on-year. 

When seeking to understand consumption in a holistic and comprehensive manner via an accounting perspective, it should be pointed out that final consumption expenditure's contribution to economic growth reached 78 percent in the first three quarters, up 14 percentage points year-on-year. 

Taking these indicators into consideration, we can see that consumption has maintained relatively fast growth and its contribution to overall economic growth keeps increasing. This momentum trend has not changed. 

Now, let's look at the statistics via several different structures. The first is the Engel Coefficient, which shows the proportion of food expenditure in total household spending. In 2017, China's Engel Coefficient dropped to 29.3 percent, below the usual benchmark of 30 percent for the first time. It was 28.5 percent in the first three quarters of this year, down a further 0.7 percentage points year-on-year. 

In terms of the consumption of services, this accounted for 48.2 percent of Chinese residents' total consumption in 2017, up 5.2 percentage points compared to 2012. It means that the proportion of service consumption in the total increased by an average of 1.04 percentage points annually over the past five years. In the third quarter of this year, its proportion reached 52.6 percent, up 0.2 percentage points year-on-year. 

In terms of physical goods consumption, sales of some products taken to indicate consumption upgrading, such as cosmetic products and smart home appliances, have maintained relatively fast growth. Auto sales overall did slow down; however, the percentage of SUV sales in the total keeps increasing. 

In terms of the urban and rural structure, in the first three quarters, the nominal growth of rural residents' consumption increased by 12 percent, much higher than that in the urban areas. Rural residents' spending on education, culture and entertainment is growing at a relatively fast pace. 

As a result of studying such factors, we can see that the public consumption structure has maintained a rapid trend of upgrading.

To sum up, the trend continues as China's consumption maintains relatively fast growth, the consumption market is expanding, the contribution of consumption to economic growth continues to increase and consumption structure is constantly upgrading. In the next period, consumption will play an increasingly important fundamental role in promoting China's economic growth as China enters different stages of development and transforms its economic development mode. However, we should attach importance to various factors that constrain consumption growth. On the one hand, we should take various measures and work harder to increase incomes, improve income distribution and the social security system, and thus raise residents' consumption capacities. On the other hand, we need to deepen the supply-side structural reform and improve the quality of supply, so as to continuously satisfy the needs of consumption upgrading. 

China Business Network:

Statistics show that, overall, investment in the first three quarters slowed down, with the growth rate of infrastructure investment only 3.3 percent. Will the low speed of increase become the new normal in infrastructure investment? How to analyze this trend? In addition, private investment has maintained good momentum, but we notice the contradiction in private financing is aggravated this year. Will this affect the overall growth rate of private investment in the future?

Mao Shengyong:

You have asked two questions. The first is about infrastructure investment. During the first three quarters, the growth rate of fixed assets investment was 0.1 percentage points higher than the level achieved from January to August. As for its structure, the growth rate of manufacturing investment is accelerating and that in the real estate sector has become a bit slower, yet is still around 10 percent. The increase rate of infrastructure investment fell further to 3.3 percent; however, if we view it consecutively, the range of falls is narrowing. With the efforts made to keep employment, the financial sector, foreign trade, foreign and domestic investments and expectations stable, a larger number of key projects are advancing steadily and infrastructure investment is expected to be more stable. 

Your second question concerns the growth of private investment, which has gone generally well this year. It has witnessed a cumulative growth rate of over eight percent, a relatively high rate, as most of the private investment has flowed into manufacturing and real estate, both sectors where around 70 percent of capital comes from this source. Investment in manufacturing grew faster, while real estate saw a cumulative growth rate of about 10 percent. Therefore, private investment has been able to maintain good momentum. 

Market News International:

Some investors believe China will face greater downward economic pressures next year, considering the negative impact of the China-U.S. trade war, such as falls in the job market and investment, and influences on imports and exports are yet to be fully revealed. So, what is your expectation of next year?

Mao Shengyong: 

According to the statistics of the first three quarters, the national economic performance remained stable. We have certainly noticed growing uncertainties caused by changes in the external environment, but how the current trade friction between China and the United States will develop is unpredictable to some extent. These factors may exert some influence on the Chinese economy and pose some challenges to us. 

Yet, the statistics of the first three quarters show that the factors you just mentioned, such as the job market, the urban unemployment rate and the number of new urban job openings, remained stable. We have conducted investigations on enterprises with high reliance on foreign trade and on export-oriented enterprises in coastal areas. Their employment has  remained generally stable. This means the overall job market is stable. There are some structural conflicts in the job sector. However, we need to wait to see what affects will be produced by the changes in the external environment. 

Regarding influences on investment, presently, as noted, investment is stable. In the first three quarters, foreign direct investment and the inflow of overseas capital increased at a fast speed. The Chinese market is a big one, with great potential; so, it is still attractive to investors.

Regarding imports and exports, the growth rate in the first three quarters was satisfactory. The third quarter in particular saw very fast development. In the period of July, August and September, both the total volume and the growth rate of imports and exports increased each month. This was caused by several factors. For one thing, some enterprises actively changed their operations mode and rhythm to cope with changes in the general environment. For another, a series of foreign trade policies, including the policies and measures to facilitate trade, provided effective support. Besides, many enterprises have adopted a diversified trade strategy. So, when we take a closer look at foreign trade, we find that the growth rate of trade with countries along the routes of the Belt and Road is much higher than the overall figure.

Generally, we are confident of achieving the 6.5 percent economic growth rate set for this year. We will face uncertainties next year; however, the Chinese economy is resilient, and many factors are predictable. Therefore, we hope we can utilize the resilience and our overall strengths to handle external pressures. As long as we focus on our own issues, our economic performance will be stable next year. 

China National Radio:

Recently, the Central Bank revealed that, in order to resolve structural problems in the domestic economy, China is considering the treatment of State-owned enterprises on the principle of “competitive neutrality”. Does this mean State-owned enterprises will be exempted from their policy burden, and that all businesses will compete on a level playing field? In addition, how to achieve this kind of competitive neutrality in the future? What changes will this produce in regard to China's economic structural problems? Thank you.

Mao Shengyong:

Your questions are very academic. This point was raised by the Governor of the People's Bank of China Yi Gang only a few days ago. Competitive neutrality, from an academic viewpoint, means that, under the conditions of a market economy, countries treat different types of enterprises equally. We call this kind of technical methodology as the principle of competitive neutrality. In other words, as long as it is a market entity, regardless of its identity, it is treated equally, and enjoys fair treatment in terms of market access and resources. The principle of competitive neutrality can help promote development of the private economy, thus boosting private investment. It is also conducive to the reform and development of State-owned enterprises.

Reuters:

I notice the contribution rate of imports and exports to economic growth was negative in the first three quarters. Does it mean that, although the indicators relating to exports were positive, the trade friction between China and the U.S. has already impacted the Chinese economy? What is your opinion on the impact of the friction in regard to the financial market, including exchange rates? Will it influence the real economy? Thank you.

Mao Shengyong:

As I mentioned just now, from the expenditure accounts, the contribution rate of final consumption expenditure to economic growth was 78 percent in the first three quarters, an increase of 14 percentage points over the same period last year. Net exports of both goods and services contributed minus 9.8 percent to economic growth, while the relevant figure for the same period last year was 1.3 percent. Does it mean the export performance exerted a negative impact on economic growth in the midst of the trade friction? I don't think so. Actually, both imports and exports maintained faster-than-anticipated growth in the first three quarters, with the growth rates increased month by month in the third quarter. Why was the contribution rate of net exports negative? I think the following explanation can account for it.

First, in measuring imports and exports, apart from trade in goods calculated by customs, we should also take into consideration the trade in services. Although China enjoys surplus in goods trade, it still faces a services trade deficit. We need to consider the two parts together. 

Second, we need to adjust the value of imports and exports according to international accounting principles, for example, using CIF to calculate import prices, and FOB for export prices.

Third, when talking about the speed of growth, we need to take into consideration both current and the constant prices. The price factors of services and goods imports and exports should be deducted and then the constant price can be computed. The figure differs from that released by Customs, as the statistical caliber is different. Another important factor is the base quota of the previous year. As imports and exports during the first three quarters of last year performed much better, so the growth rate was even higher than now.

With all those factors combined, though the contribution rate of imports and exports to economic growth this year is negative, the general foreign trade performance is within expectations, or even better than expected. The impact of China-U.S. trade friction on the import and export situation is not so apparent.

The second question is about the exchange rate. During the first three quarters, due to factors of the Fed raising interest rates and shrinking its balance sheet as well as the rising dollar index, major currencies all depreciated against the U.S. dollar, and those in some developing countries depreciated sharply. Against such a backdrop, the exchange rate of RMB against the dollar is relatively stable and performed better compared with other major currencies. In addition, the Chinese economy is running smoothly at present, and the momentum can be well maintained in the near future. The goods and services imports and exports continue to run smoothly and the balance of international payments is stable, therefore the exchange rate can also generally be kept stable.

Hu Kaihong:

Now, the news conference concludes. Thank you all. Thank you, Director Mao.

By Li Xiaohua, Chen Xia, Huang Shan, Guo Yiming, Zhang Junmian, Mi Xingang, Li Huiru, Zhang Liying, Li Jingrong, Li Yang, Wang Qian, Wang Wei, Yuan Fang, Geoffrey Murray

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Read in Chinese

Speakers:

Liu Liehong, deputy director of the Cyberspace Administration of China; 

Ge Huijun, president of the Zhejiang Provincial Committee of the Chinese People's Political Consultative Conference and director of the Publicity Department of the CPC Zhejiang Provincial Committee; 

Sheng Yongjun, secretary of the CPC Tongxiang Municipal Committee

Chairperson:

Xi Yanchun, spokeswoman of the State Council Information Office of China

Date:

Sept. 28, 2018

   

Xi Yanchun:

Ladies and gentlemen, good afternoon. Welcome to this press conference. The Fifth World Internet Conference will be held from Nov. 7 to 9 in Wuzhen, Zhejiang Pprovince. To help you gain a better understanding of the related situation, we have invited Mr. Liu Liehong, deputy director of the Cyberspace Administration of China, Ms. Ge Huijun, president of the Zhejiang Provincial Committee of the Chinese People's Political Consultative Conference and director of the Publicity Department of the CPC Zhejiang Provincial Committee, as well as Mr. Sheng Yongjun, secretary of the CPC Tongxiang Municipal Committee, to this press conference. They will introduce the overall situation and preparatory work for the Fifth World Internet Conference, and will answer some of your questions.

Now, I'll give the floor to Mr. Liu Liehong.

Liu Liehong:

Good afternoon. Welcome to this press conference. On behalf of the organizing committee of the Fifth World Internet Conference, now I would like to give you a brief introduction of the related situation.

The Fifth World Internet Conference, co-sponsored by the Cyberspace Administration of China and the Zhejiang Provincial People's Government, will be held in Wuzhen, Zhejiang, Nov. 7 to 9 on the theme of "Creating a Digital World for Mutual Trust and Collective Governance – Toward a Community with a Shared Future in Cyberspace." The conference will invite more than 1,500 important guests from around the world, including government and private sector leaders, representatives from international organizations, technological communities and nongovernmental organizations, to discuss and exchange insights focusing on innovative development, cyber security, cultural exchanges, people's livelihood and welfare, and international cooperation. The aim is to build a platform for China to better connect to the world, and for all countries to pursue shared governance, to promote global common prosperity, and to lift the development level so as to build a sustainable digital world.

At present, the preparatory work for the conference has been completed. Compared with previous years, the fifth conference has the following special features:

First, the theme is more focused and the design more innovative. The conference will thoroughly implement the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, especially the Four Principles for promoting reform of global internet governance, and the Five Propositions to build a community with a shared future in cyberspace laid out by President Xi. Adhering to the "1+2" functional positioning, involving forums, a world leading internet scientific and technological achievements release and an expo, the conference will have a total of 19 sessions focusing on such hot topics as artificial intelligence, 5G, big data, cyber security, digital Silk Road, etc.

Second, the fifth conference will highlight both inheritance and innovation. This year we will focus on the extraordinary journey the conference has gone through in the past five years. Focusing on the theme of "Creating a Digital World for Mutual Trust and Collective Governance – Toward a Community with a Shared Future in Cyberspace," an exhibition on the achievements over the past five years will be inaugurated. There is a special topic of "Wuzhen Roundtable: Review and Prospects," focusing on in-depth discussion on building a community with a shared future in cyberspace. At the same time, the old brands such as Minister Dialogue, Business Leaders Dialogue and International High-Level Think Tank Forum on the Internet will continue to function with new connotations. 

Third, international elements will become even more prominent. This conference will be co-organized by five international organizations such as the United Nations Department of Economic and Social Affairs and the International Telecommunication Union. Drawing on advanced experience of other international conferences, we will build a platform for China to better connect to the world. We will invite more elites and representatives from around the world, and bring together more new elements in the internet sector to ensure more people can share the benefits of its development. During the fifth conference, a New Internet Gadgets and Applications Promotion Salon will be held to encourage internet companies from around the world to launch outstanding new products and new applications. There will be also a salon for international guests to exchange ideas. 

Fourth, the results are expected to be more fruitful. The conference will publish a "Report on World Internet Development 2018,""Report on China Internet Development 2018" and "Wuzhen Outlook 2018," as well as further promoting the "Wuzhen Process." The world-leading internet scientific and technological achievements release will cover about 15 global leading scientific and technological achievements in the field this year; the Light of the Internet Expo will focus on the latest developmental trends. At the same time, a pragmatic cooperation platform will be set up to encourage all parties to publish the latest research reports, advocacy documents and cooperation results in the internet field.

Fifth, new levels of intelligence will be generated. Technical applications such as driverless sightseeing cars, VR/AR applications and highway unmanned driving will be gradually shown at the scenic spot. The conference is actively promoting the application of smart technologies such as face recognition and artificial intelligence in guest registration, conference services, and information release.

Ladies and gentlemen, the World Internet Conference has been successfully held for four times. It has received great attention and wide recognition globally. While Wuzhen is a classic ancient Chinese town, the future-oriented World Internet Conference is embracing the world. The fifth World Internet Conference is about to open in a little over a month, and we look forward to your arrival.

Thank you.

Xi Yanchun:

Thank you, Mr. Liu Liehong. Now, we give the floor to Ms. Ge Huijun.

Ge Huijun:

Good afternoon, everyone. 

In 30 days, the Fifth World Internet Conference will open in Wuzhen. Zhejiang province has been comprehensively implementing the guiding principles from Xi Jinping, general secretary of the Central Committee of the Communist Party of China (CPC), on the conference. Under the leadership of the Cyberspace Administration of China, no effort has been spared in preparing for the conference to make it better than before, and we try hard to play a good role on the home stage. With the experience learnt over the past four years, we have gradually increased our abilities and we are confident for the success of the annual conference this year.

First, conditions for holding the conference have been greatly improved. In the past five years, we have focused on the development of soft and hard infrastructure to meet international standards. While the first and second conferences were held at Wuzhen Township's crowded scenic areas, it is gratifying to note that the third and fourth ones took place in the spacious Wuzhen Internet International Conference and Exhibition Center, thus scaling new heights in infrastructure improvements every few years. This year, we are doing even better – more than 400 guest rooms have been newly added to ensure that all the 1,500 invited guests can book their accommodation and check in smoothly when the time comes.

The new banquet center, located only one street from the convention and exhibition center, will begin operating during the conference. With a construction area of 48,000 square meters, its overall appearance is integrated with elements of the internet and distinctive features of the southern region on the lower reaches of the Yangtze River, hence becoming another landmark building after the convention and exhibition center in Wuzhen. During the conference, we will display a number of high-tech products, involving 5G communications technology for commercial use in pilot areas, face recognition technology, and intelligent conference systems, as well as other relevant technologies. I am sure that all these approaches will help our guests better experience the facilities of an intelligent and smart international conference.

Second, more varied and colorful events are on offer during the conferences. In previous conferecnes, we set a small goal of launching special events to display the distinctive styles of Zhejiang province so that our guests could share and experience the pleasant life of the region south of the lower reaches of the Yangtze River during their stay in Wuzhen.

This year, in addition to major events such as the opening ceremony, forums and the "Light of Internet Expo" mentioned by Mr. Liu just now, we will also launch some new events, such as the Zhejiang special forum on "innovation and breakthrough of the industrial Internet", the "direct connection with Wuzhen," an internet innovation and entrepreneurship competition, and a "business talent show." Besides, our signature event "Dialogue Between Internet Tycoons" will continue to be held. This year, we will premiere the large multimedia symphony "Liangzhu" as a special performance. Through the excellent combination of art with high technology, and the fusion of the world and the Chinese nation, the symphony will show the audience the 5,000-year-long history of "Liangzhu" – a civilization popular in the Yangtze River Delta of southern China.

Third, the event is bringing more tangible benefits. The four previous conferences have raised Zhejiang's popularity and influence, made Wuzhen better known around the world, and brought about a series of preferential policies for Zhejiang province. For example, the government has approved the first national information economy demonstration area to be set up in the province; Zhejiang's capital Hangzhou was named as one of the national internet backbone access points; the Ministry of Industry and Information Technology and the Zhejiang provincial government have a cooperative agreement to promote industrial internet development; Wuzhen has set up a comprehensive experimental zone for internet innovation and development. These policy supports have created new opportunities for Zhejiang's digital development and its reform program to streamline administrative procedures. Last year, the provincial government established the Zhejiang Laboratory, a key scientific and technological innovation platform. In the first half of this year, core industries of the provincial digital economy recorded an added value of 234.8 billion yuan (US$ 34.14 billion), up by 16.4 percent year-on-year. I introduced the Computing Conference during the press conference for the second World Internet Conference three years ago. Back then, the event attracted 40,000 participants. This year, the number reached 120,000, coming from 81 countries and regions. This has mirrored Zhejiang's booming digital economy.

Friends of the media, the CPC Zhejiang Provincial Committee and the Zhejiang Provincial People's Government attach great importance to hosting for the World Internet Conference. We will continue to provide good service for the participants.

Finally, I would like to thank you for your support and welcome you to come to Wuzhen and have a wonderful time.

Thank you!

Xi Yanchun:

Thank you for Ms. Ge's introduction. Now the floor is open for questions. Please identify the media outlet you represent before asking your question.

CCTV:

I have a couple of questions for Mr. Liu. Just now, you introduced the theme of this World Internet Conference "Creating a Digital World of Mutual Trust and Shared Governance – Joining Hands to Build a Community of Shared Future in Cyberspace." Why was this theme specifically chosen? In addition, you said that the conference had been held for four times, this year is the fifth one. What has changed during those five years and what has not? What are the other highlights? Thanks.

Liu Liehong:

At present, global trade protectionism is gaining ground and the backlash against the globalization trend brings many challenges. We set the theme aiming to further encourage the world to establish a concept of internet development featuring mutual trust, management by all countries, free exchanges, mutual learning, cooperation and sharing to boost peace and development of global cyberspace.

This emphasis shows up in the following ways. First, the exploration and application of latest technologies will be highlighted. The expert and entrepreneur forum will be added to focus on the release of the world leading internet scientific and technological achievements. More leading technological talents and entrepreneurs can exchange views here. Second, equal importance will be attached to security and development. The conference will not only pay attention to problems facing the entire international community such as dealing with cyber terrorism and the protection of privacy, as well as focusing on internet developmental trends such as artificial intelligence and 5G. The challenges will be faced and potential solutions discussed to improve the prevention and control of risks and the promotion of digital development. Third, the internationalization will be increased. The world's Internet enterprises, international organizations and experts will get together in Wuzhen to discuss issues such as how to bridge the digital gulf between nations and international cyberspace management to further build a community of a shared future in cyberspace.

China National Radio:

Mr. Sheng, as Tongxiang has undergone a dramatic transformation since it became the permanent site of the World Internet Conference, would you please tell us in what way the county-level city will ensure a greater sense of gain for its people when seizing the opportunity to boost local economic development?

Sheng Yongjun:

Thank you so much for your question. I wish to express my great gratitude on this particular occasion to every media friend for your continuous concern and support to Wuzhen and to Tongxiang. The World Internet Conference has brought about an all-round and profound transformation to Tongxiang.

The first change is in regard to the landscape. By expanding from 67 to 110 square kilometers, Wuzhen has made notable progress in sprucing up its appearance and improving its functions, both of which have enabled the city to evolve in its nascent stage as an international place. The second is in regard to growth momentum. Tongxiang has basically achieved high-quality development with its economy and society moving in an obvious promising upswing. The third is in regard to its people. The World Internet Conference has brought about a tremendous impact on Tongxiang's residents, transforming their ways of thinking, changing their mode of production and renovating their daily lifestyle. Now, Tongxiang people are more willing to learn, accept and sharing in new things. Therefore, to better benefit from the Conference and develop the local economy to ensure local people a stronger sense of gain, keeping in mind General Secretary Xi Jinping's instructions on the Conference, Tongxiang as well as Wuzhen, we'll strive for three-pronged endeavor to make Wuzhen, Tongxiang and the lives of local people better:

First, we'll build a better Wuzhen. Tongxiang is strongly committed to staging each annual session of the Conference in an increasingly remarkable way. At the same time, we will strive to secure an advanced position of the digital industry, giving full play to the Wuzhen experimental zone of Internet innovation. 

We'll vigorously develop such industries as artificial intelligence and big data, and expand the exhibition economy, making Wuzhen a center of empowerment for the future economy. In doing so, we have designed a 10-square-kilometer zone for digital economy development, in hope that it can receive more quality resources. We will make Wuzhen a quality destination. We will, with an international view and in line with international standards, further reinforce its functions and improve its amenities with a view to enabling its tourism sector to better generate all-round development for the town. We will consolidate Wuzhen's position as a leading tourism destination that is also increasingly livable and suitable for working in.

Second, we'll develop a better Tongxiang. We think there are three effects we need to achieve to further elevate the high-quality development of Tongxiang. The first one is industrial cluster effect. We have planned an area of 125 square kilometers centered on scientific innovation in Wuzhen as a main avenue to respond to the integrated development of the Yangtze River Delta, the construction of the Zhejiang Great Bay area and the opportunities arising from the World Internet Conference. We aim for the area to make up 80 percent of Tongxiang's Gross Domestic Product (GDP) within three years. Second, radiation effect. We have set aside four major blocks with clearly defined functions: the intelligent manufacturing industry in the economic development zone, the digital industry in Wuzhen, the fashion industry in Puyuan and the back-up services in the main urban area, hoping the four blocks can respond to each other and achieve coordinated development. Third, demonstration effect. We have decided on forging a partnership with China Ping An Insurance Group Co. Ltd. to build a smart city of 3.5 square kilometers with ubiquitous Internet technologies and smart experiences, providing a showcase of future lifestyle and mode of production. 

Third, we'll ensure local people can lead better lives. The dividend brought by the Conference to Tongxiang and Wuzhen is in essence a greater sense of gain for local people. We will work to ensure that our people can get their things done more easily in terms of administrative procedures. We will continue the reform aimed at enabling people to get their things done in one go, and improve smart governance so that local people can finish all their procedures online and enterprises can benefit from improved administrative service. Additionally, we'll make local lifestyles smarter, with the promotion of smart senior care, smart health care, smart education, smart traffic and smart social governance. We'll provide more and higher-quality public services to see that our people benefit from the Internet. Besides, we'll open more channels to increase our people's incomes. Against the backdrop of rural vitalization, we'll take advantage of the Internet to increase the efficiency of our agricultural production and increase farmers' income. 

All in all, the World Internet Conference has become the largest IP of Wuzhen as well as Tongxiang. With the opportunities presented by the Conference, we'll have a great future to be embraced. Thank you all.

The Beijing News:

My question is for Mr. Liu. The guest lineup of the World Internet Conference draws great attention every year. Could you please tell us which famous enterprises and business leaders of the internet industry will be expected this year? Also, you mentioned that there will be 19 sub-forums this year. Why arranging these sub-forums? What results are they expected to achieve? Thank you. 

Liu Liehong: 

Thank you for the question. The World Internet Conference is an important global event. Top internet enterprises, including multinationals, and leading industry figures actively participate each year. Since the preparatory work of this year's conference began, all work has been carried out smoothly, with many industry heavyweights, famous global enterprises and notable domestic enterprises confirming their attendance. I'm sure this year's conference will be as excellent as before.

This year's conference is divided into five sectors with 19 sub-forums. We made this arrangement for the following three reasons. 

First, after studying and reviewing this year's hot topics worldwide, and focusing on the theme of this year's conference, we set up the five sectors -- innovative development, universal security, openness and inclusiveness, beautiful life, as well as common prosperity. Our aim is to give a full explanation to the concept of "community of shared future in cyberspace."

Second, we place equal emphasis on development and security. While paying attention to cutting-edge technologies like AI and 5G to comprehend the trend of technological development, we try to rise to the challenges posed by cyber security, which affects all countries, by enhancing the world's ability to manage risks. 

Third, we continue to promote the themes of the previous sessions, so we continue to hold the forums of minister dialogue, high-level think tank forum and business leaders dialogue. We are trying our best to consolidate and extend the influence of the conference's most eye-catching forums worldwide. 

Thank you. 

Bloomberg:

My question is for Mr. Liu. It was reported that Facebook had registered an incubator platform in Hangzhou this year; however approval was later withdrawn. Does it indicate that internet companies like Google and Facebook will be restricted by the Chinese government from expanding their non-social and non-search businesses in China? Thank you.

Liu Liehong:

Thank you for your question. As far as we know, Facebook made contacts with relevant agencies in Hangzhou, but has not got the business license for its subsidiary in the city. I would like to reiterate that China is willing to share the opportunities of its internet development with the rest of the world. Foreign internet companies are welcome to develop their businesses in China as long as they abide by our laws and regulations, observe rules made by relevant agencies as well as respect China's history and culture.

Thank you.

China Radio International:

We know that the World Internet Conference has had a profound impact on Zhejiang province's economic and social development, and also played a positive role in promoting the government's digital transformation. The "One-Stop Service" reform has become a new business card of Zhejiang. What is the state of progress of the reform and what kind of benefits have people got from it?

Ge Huijun:

Thank you for your question. Here I will give you an example. Last February, a couple in Shaoxing, Zhejiang province, were arranging a transaction involving the purchase of a secondhand housing in Keqiao District of Shaoxing. They submitted the relevant document at the service window at 10:00 a.m., and then got the new property ownership certificate before 11:00 a.m. This is one of the changes brought about by the "One-Hour Handling and Conclusion" service launched this year in Keqiao district, which is also a reflection of Zhejiang's "One-Stop Service" reform.

As you said, the World Internet Conference has promoted Zhejiang's economic and social development and also contributed to the government's digital transformation. In the past, the problem that companies and the general public mentioned most was "slow, complicated and difficult procedures". One of the important reasons is that there are data barriers between government departments, and information cannot be freely exchanged and shared. 

The "One-Stop Service" reform is to comply with the concerns and expectations of enterprises and the general public. With the help of the internet, big data and other information technologies, we will vigorously promote the digital transformation of government procedures, removing information islands and data barriers. Relying on the internet, we can ensure that data will move more freely, meaning people will make fewer visits, and even won't have to visit at all. 

At present, the number of registered users of Zhejiang Government Administration Service Network (zjzwfw.gov.cn) has exceeded 18.3 million. More than 50 percent of civil matters for the public can be handled by the "One ID Having All Matters Done" system. The average start-up time of an enterprise in the province has been reduced to 5.5 working days, and the registration of residents' property ownership can be handled and completed within an average two working days. According to a third-party survey, the implementation rate and satisfaction rate for the "One-Stop Service" reform reached 88.8 percent and 94.7 percent respectively. We can say reform has given enterprises and the general public a full sense of benefit. Thank you! 

Guangming Daily:

My question is to Minister Liu. With the rapid development of the internet, web applications have penetrated every aspect of our lives. At the same time, security incidents such as cyber fraud and cyber theft are occurring now and then. What can the government do to create a more secure cyberspace? Thank you.

Liu Liehong:

Thank you for your question. As you have said, cyberspace security is closely related to national security and the public interest. Achieving and safeguarding the legitimate interests and rights for the people is the aim of our work on cyber security. In recent years, we have undertaken four tasks in terms of maintaining cyberspace security and safeguarding public security.

First, we have gradually established laws and a regulatory system for cyberspace security, and promoted cyberspace governance according to the laws and regulations. Since 2016, we have successively published the Cybersecurity Law of the People's Republic of China and Measures for the Security Examination of Network Products and Services (for Trial Implementation), as well as other regulations and measures to effectively protect and safeguard the interests of the people in cyberspace. To implement the requirements of the Cybersecurity Law, we are formulating related measures such as the Measures for Security Assessment of Cross-Border Data Transfer of Personal Information and Important Data. These provide a strong legal guarantee for regulating online behavior, maintaining network order, and purifying the network environment.

Second, we set up a China Cybersecurity Week to enhance the cyber security awareness and basic security protection skills for netizens. In the third week of September each year, we are staging this event nationwide. The main venue of the 2018 China Cybersecurity Week was held in Chengdu. We held a summit forum on cyber security, The 2018 Cyberspace Expo, as well as themed activities for promoting the concept of cyber security among the public.

Third, we have accelerated the development of the cyber security industry. Maintaining the security of cyberspace requires a strong cyber security industry to support it. In recent years, cyber security industry has grown at a compound annual growth rate of 20 percent. The cyber security industry has become as a strategic emerging industry of China, spawning many famous cyber security enterprises.

Fourth, we have cracked down on internet crimes in accordance with the law. We have continuously maintained a high-level posture on cybercrime. We have repeatedly cracked down on hacking, telecommunication fraud, and infringement of citizens' personal privacy. The cyber security order has been effectively maintained for creating a clean environment for internet users. 

Science and Technology Daily:

The world-leading internet scientific and technological achievements released at each year's WIC have drawn much public attention. What are the highlights this year? To which key areas do the achievements belong? Are there any cool emerging technologies in the lineup? Thank you.

Liu Liehong:

Thank you for your interest in the planned release. The event has been held for two years and has become a major highlight of the annual WIC. World-leading internet scientific and technological achievements, including theories, technologies, products and business patterns, are collected from all across the world every year and then selected for release through a just, fair, objective and authoritative evaluation by an expert committee. The final result will be unveiled at the WIC.

This year, we have collected many quality Internet technology achievements. We believe the list will contain important achievements for release at the WIC this year. I appreciate your continuous interest in this event. Thank you. 

Economic Daily:

My question is for Ms. Ge. You said just now that Zhejiang province has achieved great progress in developing the digital economy through holding the World Internet Conference. Could you brief us on the highlights in this regard?

Ge Huijun:

Thank you for your question. Since the first World Internet Conference, we have maintained double-digit growth in the value added component of the key industries involved in the digital economy. This sector is becoming a new engine powering our innovation-driven development. I think there are three highlights of the development of digital economy in Zhejiang.

First, the development of the digital economy started early in Zhejiang. As early as 2003, General Secretary Xi Jinping, then the Party chief of Zhejiang province, initiated the program for developing a digital-based economy. Over the past 15 years, all the provincial leaders have been consistently implementing this program. Last year, the CPC Zhejiang Provincial Committee and the Zhejiang provincial government made such development a top priority, aiming to take the program to a new level. This has increased the overall strength of the provincial digital economy.

Second, Zhejiang has created a good information infrastructure. We have been promoting the development of infrastructure for cloud computing, big data, the internet, the Internet of Things and a service interface for many years. By the end of last year, our fiber-optic broadband network covered all the buildings in urban areas and all the administrative villages in rural areas, and the people gained access to 4G mobile communications. Zhejiang leads China in rural e-commerce, with the number of "Taobao villages" accounting for more than a third of the national total. Zhejiang has also become a "province of mobile payment", with the technology being applied to almost every aspect of daily life including public services, transport and health.

Third, Zhejiang has a large number of market entities engaged in the digital economy. There are more than 480 companies involved, with a production value of over 100 million yuan and 18 companies with production value of 10 billion yuan, forming five industrial clusters with the production value of more than 100 billion yuan each. In addition, driven by the development of companies with global influence such as Alibaba, Hikvision and Dahua Technology, Zhejiang is striding towards the world stage in terms of the digital economy.

Here I would like to invite more individuals and companies to develop such businesses in Zhejiang, and to better share the opportunities presented by development of the digital economy.

Xi Yanchun: 

This is the end of today's conference. Thanks for Mr. Liu, Ms. Ge and Mr. Sheng. Thank you all.

.

Read in Chinese

Date:

Sept. 25, 2018

Guo Weimin:

Ladies and gentlemen, welcome to this press conference. Yesterday afternoon, the State Council Information Office released the white paper "The Facts and China's Position on China-U.S. Trade Friction." Today, we are holding this press conference to give you a brief introduction to the book and offer explanations to its content.

Present at this press conference are: Mr. Fu Ziying, China International Trade Representative and the vice minister of the Ministry of Commerce; Mr. Wang Shouwen, vice minister of the Ministry of Commerce and Deputy China International Trade Representative; Mr. Lian Weiliang, deputy head of the National Development and Reform Commission; Mr. Luo Wen, vice minister of the Ministry of Industry and Information Technology; Ms. Zou Jiayi, vice minister of the Ministry of Finance; Mr. He Hua, deputy head of the National Intellectual Property Administration.

I'm Guo Weimin, vice minister and spokesperson of the SCIO. I will be the host of this press conference.

First, I'd like to introduce the main contents of the white paper. Entitled "The Facts and China's Position on China-U.S. Trade Friction", it comprehensively clarifies the facts about China-U.S. trade and economic cooperation, systematically states China's stance on China-U.S. trade frictions, describes the mutually-beneficial and win-win cooperation between China and the United States in regard to trade and the economy, outlines the damage of trade protectionism and bullying practices of the U.S. administration towards the world economy, as well as China's will and determination to safeguard its national interests and the current multilateral trade system. Excluding the foreword, the 36,000-Chinese-character white paper is comprised of six parts.

The white paper points out that, since the establishment of diplomatic relations, bilateral trade and economic ties between China and the U.S. have developed steadily; a close partnership has been forged to the benefit of both countries and the rest of the world; trade and economic relations between China and the U.S. are of great significance. The Section 301 investigation produced by the U.S. administration makes a series of false accusations towards China that seriously distort the facts about China-U.S. economic and trade relations. At the same time, the U.S. has also introduced escalating tariff measures that greatly damage years of growing bilateral economic and trade relations and put at risk the multilateral trade system and free trade.

The white paper emphasizes that economic globalization is the trend of the times, and peace and development represent the shared aspirations of all peoples. China-U.S. economic and trade ties concern not only the wellbeing of the two countries, but also world peace, prosperity and stability. Cooperation is the only correct option for China and the U.S., and only a win-win approach will lead to a better future. China's position is clear, consistent and firm. China is firmly committed to safeguarding its national dignity and core interests, firmly committed to the sound development of China-U.S. economic and trade relations, firmly committed to reform and improvement of the multilateral trading system, firmly committed to protecting property rights and intellectual property rights (IPR), firmly committed to protecting the lawful rights and interests of foreign businesses in China, firmly committed to deepening reform and widening national opening-up, firmly committed to mutually beneficial cooperation with other developed and developing countries, and firmly committed to building a community with a shared future for all humanity.

"A just cause enjoys abundant support while an unjust one finds little support." In a world of increasing uncertainty, instability and insecurity, China will remain true to its original aspirations, follow the trend of the times, shoulder its responsibility for justice, and pursue the greater good. It will unswervingly safeguard the multilateral trading system, press forward with the reform of global governance, promote world peace, contribute to global development, uphold the international order, and build a community with a shared future for mankind.

The white paper is available in eight languages, namely, Chinese, English, French, Russian, German, Spanish, Arabic and Japanese. The Chinese copies are published by the People's Publishing House and the foreign language versions are published by the Foreign Languages Press, all being distributed by the Xinhua Bookstore across the country.

Now, please welcome Fu Ziying, China's international trade representative and the vice minister of the Ministry of Commerce, to give some details about the white paper.

Fu Ziying:

As we all know, China is the largest developing country in the world, and the United States is the largest developed country in the world. China-U.S. economic and trade relations are of great significance not only to the two countries themselves, but also to the stability and development of the global economy. Since the establishment of diplomatic relations between China and the United States, bilateral economic and trade relations have been deepening and interests have become highly interdependent, which has brought tangible benefits to the both peoples and benefited the whole world.

The scale of economic and trade cooperation between China and the United States is huge, yet the stages of economic development, social systems, and cultural traditions are different, so it is normal to have economic and trade frictions. The key is how to enhance mutual trust, promote cooperation, and control differences. For a long time, each government has made tremendous efforts to overcome all kinds of obstacles and move economic and trade relations forward, which has served as the ballast and propeller of the overall bilateral relationship. However, the U.S. side has recently adopted unilateralism and protectionism, adopting a series of trade restrictions on China, and continuously raising tariffs on goods imported from China. Starting from basis of safeguarding the common interests of the two countries and the world trade order, China adheres to resolving disputes through dialogue and consultation and responds to U.S. concerns with the utmost patience and sincerity. However, the U.S. side has been contradicting itself and constantly escalating the situation, which has greatly affected China-U.S. economic and trade cooperation and has also caused serious threats to the multilateral trading system and the principle of free trade.

In order to clarify the facts of China-U.S. economic and trade relations, clearly state China's policy on trade friction with the United States, and pursue reasonable solutions of the issue, the Chinese government has compiled a white paper entitled "The Facts and China's Position on China-U.S. Trade Friction."

First of all, the White Paper systematically expounds the mutually beneficial and win-win characteristics of China-U.S. economic and trade relations from various perspectives of trade in goods, trade in services, and mutual investment - pointing out that both sides have benefited a lot from it. In particular, the United States has gained extensive and enormous economic benefits in its economic and trade exchanges with China and shared the opportunities and achievements brought about by China's development. The claim that the United States is "losing" in this relationship does not stand up to scrutiny.

Since last year, the U.S. government has accused China of "economic aggression," "unfair trade," "IPR theft" and "national capitalism," which have distorted the facts of China-U.S. economic and trade relations. Based on a large amount of data and facts, the White Paper makes a detailed analysis and clarification on how to view the U.S. trade deficit with China, how to look at the issues of fair trade, technology transfer between Chinese and American companies, China's intellectual property protection, Chinese companies' "going global," and China's subsidy policies and more.

At the same time, the White Paper points out that the United States itself has a large number of restrictive policies and practices on investment and trade which distort market competition, hinder fair trade, disrupt the global industrial chain, including: discriminating foreign countries' products in violation of the principle of fair competition, abusing the "National Security Review" to hinder the normal investment activities of other countries' enterprises in the United States, as well as the provision of large subsidies that distort market competition, using large-scale non-tariff barriers, and abusing trade remedy measures.

According to the White Paper, as a major establishing force and participant in rebuilding the international economic order and multilateral trade system after World War II, the United States should have been the spearhead in following the multilateral trade rules and addressing the trade conflicts with other member countries through dispute-resolving mechanisms under the framework of the World Trade Organization (WTO). However, the unilateral emphasis of "American First" has brought American domestic issues to the international community and politicized the economic and trade problems, causing damage to the national interests of China and other countries, as well as America's own image, thereby ruining its own interests in the long run.

The White Paper reiterates that, while the global economy has just been relieved from the shadow of the global financial crisis, recovery is yet to secure sound momentum. However, the United States has insisted on imposing a slew of unilateral trade protectionist policies, which have sabotaged the international economic order, challenged the global value chain as well as the international industrial division system, interrupted market expectations, and risked the global economic recovery with the enormous uncertainties it has created.

In its final chapter, the White Paper systematically elaborates China's stance.

First, China firmly safeguards its national dignity and core interests. China does not want a trade war, but it is not afraid of one. We have the confidence, resolve and capability to meet all risks and challenges. No external factor will hold back China's development. China has kept the door to negotiations open, but negotiations can only happen when there is mutual respect, equality, good faith and deeds matching words. Negotiations cannot be conducted at the cost of China's right to development.

Second, China is firmly committed to the sound development of China-U.S. economic and trade relations. The sound and steady development of China-U.S. economic and trade relations is in the fundamental interests of the two peoples and the common interests of people across the world. China would like to work with the U.S. in the same direction, act in a spirit of mutual respect and win-win cooperation, focus on economic and trade cooperation, properly manage economic and trade differences, and make vigorous efforts to foster a new China-U.S. economic and trade order that is balanced, inclusive and mutually beneficial, so as to contribute to the well-being of the two peoples.

Third, China is firmly committed to the reform and improvement of the multilateral trading system. China resolutely abides by and upholds the WTO rules, supports an open, transparent, inclusive and non-discriminatory multilateral trading system, and supports necessary reform of the WTO. China is working to promote trade and investment liberalization and facilitation, and make economic globalization more open, inclusive, balanced and beneficial to all.

Fourth, China is firmly committed to protecting property rights and intellectual property rights (IPR). China will keep improving its laws and regulations on IPR protection, and protect the lawful IPR of Chinese and foreign businesses in strict accordance with the law. China will enhance its cooperation with all countries to protect IPR, and hopes that governments of other countries will also step up their efforts to protect Chinese IPR.

Fifth, China is firmly committed to protecting the lawful rights and interests of foreign investors in China. China is committed to building an open and transparent legal system concerning foreign affairs, improving the business environment, and providing better, higher-quality services to businesses from all countries operating and investing in China. The Chinese government pays close attention to the legitimate concerns of foreign investors, and stands ready to respond to and address their specific concerns.

Sixth, China is firmly committed to deepening reform and opening wider to the outside world. China will not reverse course, but only deepen its reform. China will not close its door to the world, but only open wider. China will unswervingly deepen reform, expand opening up, comprehensively promote the rule of law and build a socialist country under the rule of law.

Seventh, China is firmly committed to mutually beneficial cooperation with other developed and developing countries. On the basis of reciprocity, China will work with relevant economic and trade partners to expedite the negotiations on multilateral and bilateral economic and trade cooperation. China will promote deeper cooperation under the framework of the Belt and Road Initiative and create new drivers for common development.

Eighth, China is firmly committed to building a community with a shared future for mankind. China will continue to act as a responsible major country, and join every other country in building an open, inclusive, clean and beautiful world that enjoys lasting peace, universal security and common prosperity.

In short, no matter how the international situation changes, China will promote world peace, contribute to global development, and uphold international order.

Thank you everyone!

Guo Weimin:

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

CCTV:

As for bilateral trade and economic ties, the U.S. side believes the Chinese side has adopted unfair approaches causing the United States to suffer losses. What do you think of this claim? Besides, what do you think of the future of bilateral trade and economic ties between China and the United States? Thank you.

Fu Ziying:

Some people in the United States accused China of unfair competition leading to a huge U.S. trade deficit in goods with China and losses on the U.S. side. This accusation is not consistent with the facts. It doesn't have a leg to stand on, being a totally a misleading accusation.

China-U.S. economic and trade cooperation is the natural outcome of the complementarity of Chinese and American industries and the inevitable choice of the international division of labor. It is in the common interests of the two peoples. After nearly 40 years of development, the economies of China and the United States have become deeply integrated and attached to each other. The annual bilateral trade volume has reached US$700 billion, and the stock of two-way investment has exceeded US$230 billion. The annual sales revenue of American firms in China has reached US$700 billion, with profits exceeding US$50 billion. The common interests of China and the United States are far greater than their differences.

In fact, the gap in China-U.S. trade is merely gap in trade volume, not the gap in profits and losses. I used to be an accountant, so I know why. Similarly, no one knows better than the related enterprises and consumers themselves whether or not the United States has suffered losses in the bilateral trade. In terms of production, China and the United States are in different positions in the global industrial and value chains. The United States stands at the high-end, while China stands at the low-end. Chinese firms are more likely to earn processing fees, while American firms benefit enormously from design, parts supply, marketing and other links. In terms of consumers, Chinese goods of good quality and reasonable price have entered millions of American homes, enriched the American consumer market and improved American consumer welfare. On the whole, the U.S side has gained more from bilateral trade. The profits gained by U.S. enterprises in bilateral economic and trade cooperation are far greater than those gained by Chinese enterprises. It can be said that, the trade surplus is reflected in China, while the "interest surplus" is reflected in the United States.

The formation of the U.S. trade deficit with China is related to the economic structure, international division of labor, statistical divergence and other factors between the two countries. Fundamentally speaking, trade competitiveness is the competitiveness of industries, and the industries with strong competitiveness see relatively higher export volumes. The United States has maintained a big trade surplus with China in competitive industries such as automobiles, airplanes, agricultural products and services. In 2017, China imported US$13.1 billion of automobiles from the United States, while China's automobile exports to the United States only reached US$1.4 billion. The United States enjoyed a US$16.4 billion trade surplus with China in agricultural products. The U.S. trade surplus in services to China exceeded US$54 billion. The China-U.S. trade imbalance can also be attributed to American export controls to China. According to the analysis of relevant American institutions, the U.S. trade deficit with China would be reduced by as much as 35 percent if American control over high-tech products for civilian use exported to China could be relaxed. The United States doesn't want to export what China wants to import, and this situation is also a major cause of the current trade imbalance.

China is willing to work hard to push bilateral trade towards greater balance, and hopes the United States will also show a positive attitude. Currently, our planet has become a close-knit global village. The trend of economic globalization is unalterable, and the trend of China-U.S. economic cooperation is irreversible.

The Australian:

China is Australia's largest trading partner. We sell LNG and other major products [to China]. Do you say that other third countries can perhaps benefit or perhaps have opportunities to sell more to China as a result of the trade war between the U.S. and China?

Wang Shouwen:

Thank you for the question. The trade war has caused great damage to the global value chain and imposed a negative influence on normal trade activities. The United States could have been a major LNG supplier of China; however, because of its restrictive measures, we were forced to take countermeasures, and this will affect U.S. LNG producers' exports, as China is one of their important export markets. To be frank, the measures have already created some effects.

Australia is an important LNG supplier of China. The trade volume is enormous, and there is even greater potential. As Mr. Fu Ziying just said, China has a big market, and is willing to open wider. Opportunities are available to all LNG producers and supplying countries if there is no trade war.

Xinhua News Agency:

Can China's economy sustain the impacts of the economic and trade frictions with the United States? How will China respond to the downward pressure on its economy?

Lian Weiliang:

Thank you for these questions. Undoubtedly, America's punitive tariffs on US$200 billion of its imports from China will have both direct and indirect impacts on the Chinese economy, with the influence on some industries and regions being comparatively big. Yet, although the impact is unavoidable, the risks are generally controllable, and the Chinese economy has the ability to hedge through boosting domestic demand. The risks are controllable, because of support from at least three aspects: the resilience of the Chinese economy as a whole, the potential of expanded domestic demand, and the increasing competitiveness of market entities.

First, the Chinese economy has overall resilience. The size of the economy reached US$12.7 trillion last year, with exports hitting US$2.26 trillion, so that US$200 billion only accounts for 8.8 percent. If the contribution of the processing trade is considered, the influence of (the ongoing trade frictions) on added value can be reduced even further. An important characteristic with the Chinese economy is that it has a complete range of industries and multi-element components, and various parts can complement and replace each other, which means the Chinese economy can demonstrate strong resilience and tenacity while responding to any external impact.

Looking back at the development of the Chinese economy, we have actually experienced several tests, in which external demand plummeted. For instance, China's total export-import volume dropped eight percent, in dollar prices, in 2015 and 6.8 percent in 2016, which both exerted huge downward pressure on overall economic growth. However, relying on expanding domestic demand and deepening supply-side structural reforms, we maintained economic growth within a rational range. Currently, the Chinese economy is in the phase of transforming from high-speed to high-quality growth, attaching more significance to the quality of economic growth. So, its resilience and capacity to cope with any impacts are stronger.

Second, the Chinese economy has much potential in terms of domestic demand. China has nearly 1.4 billion people, which is even more than the total population of all developed economies, and annual per capita income is now nearly US$9,000, with an obvious trend of consumption upgrading. It is fair to say the domestic market has huge potential. Meanwhile, as a developing country, where regional development gaps have yet to be bridged, China still has many problems and weaknesses, so it also has huge potential in increasing investment.

All these factors have created favorable conditions for the Chinese economy to respond to external fluctuations. The economic operations in the first eight months this year proved this judgment. The additional American tariffs on US$50 billion worth of imports from China took effect in two batches on July 6 and August 23 respectively. China's industrial added value growth in August was 0.1 percentage points higher than the previous month as well as the same period of last year. The total volume of retail sales in August was 0.2 percentage points higher than July. Investment in manufacturing industries in that month was three percentage points faster than the same period of last year, and 0.2 percentage points higher than that achieved from January to July. It is noteworthy total power consumption from January to August increased by nine percent, the fastest growth since 2011.

Third, the competitiveness of market entities constantly increases. Although export-oriented enterprises meet many difficulties, their ability to adapt to market changes, expand markets and promote science and technology innovation, will enable them to withstand market tests in the process of coping with challenges arising from the decline of external demand. The Central Committee of the Communist Party of China and the State Council attach great importance to the influences of Sino-U.S. trade frictions, and have taken a series of positive measures, stressing that we must do our own business well, and focus on the necessity of keeping stability in six fields: employment, finance, foreign trade, foreign investment, investment and expectations.

In regard to dealing with the economic downturn due to China-U.S. trade friction, the following three specific measures can be adopted: first, expand domestic demand and strengthen areas of weakness more efficiently; second, take more effective steps to lighten burdens and improve the business environment, third, introduce more effective policies to boost restructuring and improve capabilities.

First, in regard to expanding domestic demand and strengthening areas of weakness more efficiently, a guideline issued by the Communist Party of China (CPC) Central Committee and the State Council recently aims to further tap the country's domestic consumption potential. The guideline outlines fifteen specific measures to upgrade consumption and tap this potential. We will focus on strengthening weaknesses in the areas of infrastructure development, people's well-being, public services, agriculture and ecological and environmental protection, while deepening supply-side structural reform in which we will ensure private investment plays an important role and improve the confidence of private investors.

Second, in taking more effective steps to lighten burdens and improve the business environment, China will further ease the burden on companies through additional cuts on taxes and fees, deepen reforms in streamlining the administration, delegate powers, and improve regulation and services to further improve China's business environment and deepen the country's opening up. All these measures are applied equally to both Chinese and foreign companies. We will continue to adhere to the socialist basic economic system while unwaveringly seeking to encourage, support and guide the development of the non-public sector to stabilize social expectations and boost development confidence.

Third, in regard to introducing more effective policies to boost restructuring and improve capabilities, we will provide more support for Chinese companies to explore international markets to strengthen win-win cooperation with the European Union, Japan, Russia, ASEAN and Africa and develop a diversified trade market based on the Belt and Road Initiative. We will also encourage Chinese companies to improve their adaptability to market changes, which requires them to optimize their product structure, to develop products that can meet diversified market needs and improve innovation capacity and core competence.

As a general comment, the Chinese economy has sufficient resilience and potential. China is fully capable of hedging the impact of China-U.S. trade friction through promoting high-quality development by expanding domestic demand, and we have full ability, confidence and conditions to keep the Chinese economy on a steady course. Thank you.

CNN:

Recently, many people have concluded from editorials and commentaries in China's official media that China's leaders and government increasingly feel that the trade war and Trump's tariff measures are not just a matter of economic and trade friction, but a strategic step for the U.S. to contain China's development and rise in an all-round way. We've heard similar voices in the U.S., and there's a growing consensus among Democrats and Republicans that China is a strategic competitor for the U.S. Under the circumstances and context, do you believe that the trade friction is a deadlock, and any economic and trade talks or negotiations would be useless or unhelpful? Thank you.

Fu Ziying:

This white paper released by the Chinese government aims to profoundly analyze the benefits that both China and the U.S. have received in their cooperation after the establishment of diplomatic relations between the two countries. Despite bumps, difficulties, twists and turns along the way, China and the U.S. both have seen remarkable progress in their gross economic products and people's welfare since the establishment of diplomatic relations between the two countries over more than 40 years ago. We can't forget that the bumpy development of China-U.S. ties over the past more than four decades has always become better and better, as people from the both countries have received benefits and welfare.

The problem right now is what do you think of China? I think there are still some misunderstandings of China in the international community. One of China's three major priorities set by the Chinese government is poverty elimination. Why? Because there we still have tens of millions of people living in poverty. It has been a common task for the world to eliminate poverty. It would be impossible for millions of people to get out of poverty if China didn't develop. In the face of the poverty issue, we all know that China must stick to the reform and opening-up so as to develop itself in economic globalization. However, the key problem is that people always focus on China's large GDP and trade volume while ignoring the average level of GDP and trade per capita, which is still very low.

Mr. Wang Shouwen and I deal with both international and domestic affairs. I've learnt a lot in the investigation and survey of some areas of central and western China. I went to a village in Guangxi Zhuang autonomous region at the beginning of 2017. I went there alone without any officials accompanying me. This randomly selected village is over 100 kilometers from Nanning, the capital city of Guangxi Zhuang autonomous region. There is a family with a veteran and his three sons. It's inconceivable to see the fact that only one son can get married. Because of poverty, there is no furniture in the room, and all the children and adults sleep on the cotton-padded mattress on the floor. Their food is corn congee directly cooked on a fire pan. I burst into tears after seeing this, and I gave them all the money in my wallet.

Should we lift people out of poverty and seek common prosperity with people in China and around the world under the circumstances of economic globalization? Or should we fight with each other and adopt containment policies to end up with the fact that the rich get richer and the poor poorer? Can we do that?

Therefore, I believe that containing China or the so-called trade war is not in line with the direction and future of human peaceful development. Throughout history, wars and trade wars have a price to pay. Who will bear the cost? It's the people. Thank you.

Phoenix TV:

It's reported China has rejected the American request for negotiations; so, what is your comment on this? In addition, under what circumstances is China willing to resume high-level trade negotiations? When is the soonest this might start? Thank you.

Wang Shouwen:

Thank you for your questions. The timing of when to resume high-level economic and trade negotiations is entirely up to the United States. China has kept the door open to negotiations to address economic and trade differences; however, negotiations can only work when there is equality and mutual respect. The United States has now imposed such large-scale trade restrictions, so, how can negotiations proceed when there is a knife being held to one's neck? That is not an equal negotiation.

Second, it requires good faith and credibility to conduct negotiations. There have been four rounds of high-level negotiations between China and the United States. The two sides reached much consensus, and even issued a joint statement. However, the United States has gone back on its words, reneged on the consensus achieved, and imposed trade restrictions, making negotiations hard to proceed. Therefore, I would like to highlight that, as long as there is good faith, equality and credibility, there will be a way out through negotiations. Thank you.

Ta Kung Wen Wei Media Center:

Do China's subsidy policies comply with the relevant provisions of the WTO? Do they create unfair competition? Thank you.

Zou Jiayi:

Thank you for your questions. Under market economic conditions, subsidies are widely used by many countries and regions, including the US and China, as one of the tools to address market failure and imbalanced economic development. However, subsidy policies should follow certain rules. As one of the WTO members, China formulates the policies of subsidies in conformity with the stipulations of the WTO, which divides subsidies into three categories: prohibited subsidies, actionable subsidies and non-actionable subsidies.

Prohibited subsidiesrefer to mainly export subsidies and import substitution subsidies. Actionable subsidies may result in trade-distortion and unfair effects on international trade, and harm the interests of members, but WTO members can recourse to the WTO dispute settlement mechanism. Non-actionable subsidies will not result in social distortions and unfair trade and are used mainly for supporting research and development, a country's undeveloped regions and support enterprises to achieve new and higher standards of ecological environment protection and so on.

Since China joined the WTO, we have actively pressed ahead with reform to ensure the compliance of domestic policies.Most of China's subsidies are non-actionable subsidies, and supplemented by actionable subsidies. Prohibited subsidies have been fully abolished. At the same time, we have earnestly implemented the agreement on subsidies and countervailing measures, which stipulate obligations such as WTO's rule of transparency on subsidies. For example, according to the WTO's transparency principle on subsidies, China strictly follows the requirements to regularly notify the WTO of the revision, adjustment and implementation of relevant laws, regulations and specific measures. Since China's WTO entry, we have submitted to the WTO over one thousand notifications. The latest one was in this July. We notified the WTO of the central and sub-national policies of subsidy policies between 2015 and 2016, covering all the provincial level administrative areas for the first time.    

Of course, I don't mean that our policies are impeccable. As a developing country, China has made continuous efforts in reforming and improving the policies of industrial subsidies and the endeavor is still underway. Based on the guideline, subsidies will mostly focus on non-actionable areas, avoiding as much as possible the adoption of actionable aspects. This is exemplified by two cases. The first involves agricultural subsidies. We have scrapped three types of subsidies, namely, direct subsidies to grain growers, comprehensive subsidies for agricultural inputs and subsidies for the seeds of high-quality crops, all of which belong to the yellow box subsidies that we previously adopted. We have replaced them with supportive policies related to the conservation of agrarian lands and appropriate operational land scale, in an attempt to secure the agricultural surroundings and facilitate sustainable development while shifting to green box subsidies. The second one is: not long ago, we undertook a round of reducing capacity among manufacturing industries. To better support this, we established a designated prize fund, primarily spent on trainings and re-employment of the people losing jobs during the process. The financial support of those enterprises is provided with non-actionable subsidies as well.

By and large, China has fulfilled its commitments to the WTO. The subsidies in both the standards and measures have in no way gone beyond the organization's regulations. Hence, we have not caused market disorder and unfair competition. At the same time, during implementation, if some local governments are found to be continuing to provide prohibited subsidies, it is our indomitable resolve to get them to stop such wrongdoing. Thank you.

Global Times:

What influences will the additional tariffs imposed by the United States on Chinese goods have on the global industrial chain? If foreign investment withdraws from China because of the tariffs, what influence will it have on China's industries and the global industrial division of labor? Thank you.

Luo Wen:

The additional U.S. tariffs on Chinese goods will cause great harm to and exert negative influences on global industrial chain, which can be shown in three aspects.

First, the tariffs will break the connection between the industries of different countries, risking fragmenting the global industrial chain. As we all know, under the conditions of economic globalization, the economies of all countries are deeply integrated into the global industrial chain. The trade between countries is no longer just simple commodity trade, but relies on global production networks to jointly complete product R&D and design, processing and manufacturing, logistics and transportation, and marketing services between countries. All countries are dependent on each other with their economies closely intertwined. We prosper and suffer together. The imposition of tariffs by the United States can be said to disrupt the normal international division of labor system, making some industries disconnected from upstream and downstream industries, meaning that the global industrial chain is facing the risk of fragmentation.

Second, the tariffs will break international economic and trade rules, leaving the global industrial chain in a state of disorder. The existing international economic and trade rules represented by the WTO regulations are the important cornerstone of global economic growth. The unilateralism and protectionism currently adopted by the United States have forced some countries to take countermeasures. By July this year, in addition to China, the other major trading partners of the United States, including the European Union, Canada and Mexico, successively launched countermeasures. . Therefore, the risk of a worldwide trade war is growing. In this situation, the international economic and trade rules may be damaged or collapse completely. Once the global industrial chain loses the fundamental support of these rules, the risk of disorder will become even greater.

Third, the tariffs will reduce the efficiency of global economic operations, leaving the global industrial chain exposed to greater risks of low efficiency. The additional tariffs of the United States have dealt a blow to normal commodity trading and resource allocation worldwide, reducing the efficiency of international economic operation. In April this year, the International Monetary Fund (IMF) released the World Economic Outlook, stressing that an increase in tariffs and nontariff trade barriers could disrupt global supply chains, and slow the spread of new technologies, reducing global productivity and investment. This will lower the overall efficiency of the global industrial chain.

This is the answer to your first question.

As to the impact of relocation of foreign companies, we believe that cross-border investment and relocation are voluntary business practices of companies to allocate resources efficiently across the globe. For any country, there are companies moving in and out every day. It is a normal and natural result of economic globalization. Up to now, the escalating trade friction provoked by the United States has had some impact on foreign companies in China. Some have decided to move to other countries in order to diversify their risks and lower costs. We should take a rational view of this issue.

First, instead of sidestepping it, we will take various measures to help companies overcome any difficulties. We will consistently deepen reform to streamline administration, delegate powers, improve regulation and strengthen services. We will cut taxes and reduce tax burden on companies and consistently improve the business environment.

Second, instead of exaggerating the issue, we should have every confidence in the potential of the Chinese market and the advantages of our industrial supporting capacity. China offers enormous market potential, a complete industrial supporting system and ample room for business development. Therefore, most of the foreign companies decide to stay for common development with the Chinese economy. There are also companies further exploring the Chinese market. For example, American electric vehicle manufacturer Tesla in July announced plans to build a super factory in Shanghai, its first outside the United States.

Third, we will open China wider to the outside world at our own pace. We will stay committed to market-oriented reform, continue opening-up, and implement all of the announced initiatives to achieve this. We are convinced that more and more foreign companies will come to invest in China, and most of the companies operating here will stay for further development. Thank you.

Bloomberg:

What expectations do you think the U.S. negotiators have for China-U.S. economic and trade frictions? What do they expect from the negotiations?

Wang Shouwen:

There have been four rounds of high-level negotiations between China and the U.S. As I have mentioned already, the two sides have reached much consensus during the negotiations, and even issued a joint statement. However, it is very regrettable that the U.S. administration has backtracked and reneged on the consensus achieved, thus escalating the trade frictions. These moves harm not only China-U.S. trade, but also the interests of American workers, farmers, herders, companies and consumers, about which other WTO members around the world are also concerned. We do not know why the U.S. has backtracked and reneged in this way. Actually, the trade war waged by the American administration has brought the U.S. no benefits. The U.S. is a major source of China's agricultural imports; however, from January to July this year, China's agricultural imports from other countries, including Brazil and Australia, increased significantly, while those from the U.S. rose only slightly. The U.S. was long the largest supplier of cars to the Chinese market; now, however, Germany has replaced the U.S. In the Chinese market, the supply of Japanese and German-made cars is growing, while that of American cars is falling. The trade measures of the U.S. have not cut its global trade deficit. Instead, its trade deficit with both China and other parts of the world are increasing. Therefore, we believe that a trade war is not in the interests of China, nor is it in the interests of the U.S. Terminating the trade war is the way out. China International Trade Representative Fu Ziying mentioned just now that the China-U.S. trade volume amounts to US$700 billion. For such a large trade volume, it is normal for there to be trade disputes between the twosides. As long as both conduct equal negotiations in a spirit of good faith and credibility, I believe that there will be a way out through negotiations. Thank you.

China News Service: 

The U.S. administration accused China of lack of IPR protection and the so-called theft of intellectual property. What's your take on this issue? What measures will China take to further enhance protection of IPR, especially IPR owned by foreign enterprises in China?

He Hua:

Thank you for your question. First of all, the recent accusations by the U.S. administration about IPR protection show total disregard for China's improvement in the system for intellectual property rights protection, the sharp increase in China's innovation capacity and the fact that China has been a major IPR nation. Thus, the accusations are totally unfounded and untenable. The Chinese government has adopted a clear stand in regard to strengthening IPR protection. In his keynote speech at the Boao Forum for Asia Annual Conference 2018, President Xi Jinping announced China would strengthen protection of intellectual property rights as one of the important new measures for further expanding reform and opening up. In his address at the opening ceremony of the Summer Davos this year, Premier Li Keqiang reaffirmed China will implement a more rigorous IPR protection system to ensure law breakers pay an insufferable price for their IPR infringements, so as to propel more domestic innovation. These statements reflect the clear stand of the Chinese government in this regard.

China has the intrinsic requirement for strengthening IPR protection. China has come to a stage when its innovation capacity is rapidly increasing and innovation-oriented entities are developing fast. According to the "Global Innovation Index 2018" released by the World Intellectual Property Organization (WIPO) and Cornell University in July, China's ranking rose from 22nd in 2016 to 17th in 2018. Thus, it has broken into the world's top 20 most-innovative economies for the first time. Over nine out of every 10 Chinese invention patent applications are from domestic applicants. China filed 51,000 international patent applications via the Patent Cooperation Treaty (PCT) in 2017, ranking second in the world. In the first half of this year, nearly 80 percent of the invention patents granted by China were from domestic applicants and and nearly 70 percent of the invention patents valid in China were from domestic applicants. Therefore, strengthening IPR protection is the intrinsic requirement of China for its own development. Meanwhile, China's achievements with regard to IPR protection are widely recognized.

China treats foreign companies the same as domestic companies in regard to IPR protection. Its achievements are gaining increasing endorsement by the international community. Here are some statistics reflecting the progress made by China on IPR protection. First, foreign invention patent applications reached 650,000 over the past five years, up by an annual average of 3.1 percent; and foreign trademark applications reached 840,000 in the same period, up by an annual average of 10.3 percent. With these statistics, China has proved itself a country with a good national IP environment. Otherwise, such a big volume of applications would be unthinkable. 

The second data group: From 2012 onwards, the National Intellectual Property Administration has commissioned a third party to conduct a series of surveys on public satisfaction with China's protection of intellectual property rights. Last year's survey produced a satisfaction rate of 76.69 points. At the same time, the satisfaction level of wholly-foreign–funded enterprises secured a score higher than the general standard with 76.94 points, and joint ventures went even higher with 80.16 points. This would suggested a high degree of satisfaction and their consent to China's endeavor in IPR protection.

The third data group: An article published this year on the U.S. website--"The Diplomat"--revealed that foreign enterprises in China could win over 80 percent of the lawsuits concerning IPR infringements in the country. China has already been a destination for the IPR prosecutions from many multinational conglomerates.

Finally, Chinese companies paid US$28.6 billion for royalties of foreign patents in 2017. Among the amount, China held the biggest deficit in IPR royalties against the U.S., reaching US$5.07 billion. Such a big volume would be unthinkable without a good national IP environment. 

We will strengthen IPR protection in a stricter, more comprehensive, efficient and equal manner. To improve the strictness of IPR protection, we are working on amending the Patent Law and the Copyright Law, and setting up systems of punitive damages for all sectors related to IPR protection. To establish a comprehensive system of IPR system, we will mainly strengthen administrative law enforcement and judicial protection in accordance with the law, and also improve arbitration and mediation. To enhance the efficiency of IPR protection, we have set up 19 IPR protection centers across China to undertake review, determination and protection of rights faster in a more coordinated way. For example, it takes no more than seven to eight working days to obtain a decision on administrative punishment. To ensure equality, we will offer equal protection measures to all companies, whether they Chinese or foreign, big or small. Thank you.

Guo Weimin:

I believe reporters here have already witnessed the efforts the Chinese government has made to protect intellectual property rights (IPR). Officers from the National Intellectual Property Administration have done lots of effective work, like at least holding one IPR Promotion Week every year and a SCIO briefing to answer questions from the press.

Please go ahead and raise your questions.

TASS:

Can China compensate for the losses caused by the U.S. trade friction through international platforms such as the BRICS and through economic cooperation with some partner countries, including Russia? Thank you.

Fu Ziying:

The comprehensive strategic partnership between China and Russia has set up a good framework for the cooperation and exchanges between the two countries.

The various dialogue mechanisms between the two sides have seen smooth and effective progress. Especially at the recent 18th SCO Qingdao Summit, the leaders of the participating countries reached a broad consensus on future development. China and Russia have solid foundation of political mutual trust and strong complementarity.

Under such circumstances, the cooperation and exchanges between the two sides serve the fundamental interests of the two peoples. Under the leadership of Chinese President Xi Jinping and Russian President Vladimir Putin, we can overcome obstacles and further develop the China-Russian relationship in a more healthy and stable way. Thank you.

Shenzhen TV:

We note that some enterprises committed to bilateral trade between China and the United States have been affected by the Sino-U.S. economic and trade frictions. For example, ZTE in Shenzhen. In view of the impact of the frictions on enterprises, I would like to ask the heads of relevant departments for some specific tips to these enterprises to help them weather the storm better? Thank you.

Wang Shouwen:

Not only Chinese enterprises don't like trade conflict, enterprises, workers, farmers and consumers in the United States do not welcome a trade friction either. Mr. Luo said that the trade friction refers to the whole industry chain. It damages enterprises both in China and in the United States, and even in other countries. Mr. Lian mentioned that the Chinese central government has already taken measures in six areas to offer a better business environment for enterprises.

Meanwhile, enterprises have to be fully prepared to respond to unavoidable risks in terms of exporting and developing international markets. Therefore, we must do the following to tide over the crisis. Firstly, the government should create a better external and internal business environment for enterprises. Secondly, the enterprises should constantly enhance their competitiveness and try hard to develop diversified markets.

Luo Wen:

I'd like to add that the China-U.S. trade friction will hamper the development of the small and medium-sized enterprises (SMEs) in both countries. The United States made an announcement to impose 10-percent additional tariffs on US$200 billion worth of Chinese products from Sept. 24. Millions of SMEs will be targeted. Objectively speaking, the China-U.S. trade friction not only damages the interests of SMEs and consumers, but also threatens the security of the global industry chain and supply chain.

As always, China develops amid obstacles and difficulties. Nothing is impossible to overcome. We have confidence and are capable of helping SMEs to get through this hard time.

Statistics in the first seven months of this year show that the performance of small and medium-sized enterprises above the designated size was generally sound. The value added was up by 7 percent year-on-year. The revenue of the principal activities was up by 9.5 percent year-on-year and the total profit was up by 11.4 percent year-on-year.

The next step:

Firstly, we will continue to expand domestic demand, give full play to the advantage of huge markets in China, and lead SMEs to develop in a professional, precise, characteristic and novel manner

Secondly, we will actively open new markets and firmly support SMEs to involve in the Belt and Road Initiative and develop the markets along the routes.

Thirdly, we will vigorously streamline administration, cut taxes and reduce administrative fees to stimulate the vitality of small and medium enterprises. Thank you.

Macao Daily News:

The United States has repeatedly accused the Chinese government of compulsory technology transfer. What is your comment? Thank you.

Wang Shouwen:

Thank you for your question. The White Paper explains this issue. I will do some more reading here. Regarding the so-called "compulsory technology transfer," we must first make it clear who is forcing who.

In all Chinese laws, regulations and policy documents, foreign enterprises are not forced to transfer any of their technology to Chinese companies. I challenge you to really find any such provisions in any documents, and if you do so, please let me know. Moreover, in order to prevent government agencies from exerting pressure on foreign enterprises and requiring them to transfer technologies to Chinese enterprises, this year, the State Council also issued a special instruction asking governments at all levels not to use administrative measures to force any such technology transfer.

When foreign companies export products to China, the Chinese door is open and there are no obstacles. If they want to sell their technologies to China, that is completely voluntary and there are no obstacles. Some companies now say that, when they want to invest in China, the Chinese government asks them to transfer technologies. Let's look more closely at this claim, and make it clear that foreign companies can invest in China and establish wholly-owned enterprises in most areas. There is no issue of technology transfer in establishing wholly-owned enterprises.

Everyone can check our negative list of foreign investment and find that fewer and fewer industries now require joint ventures. There are, indeed, only a small number of industries that require Sino-foreign joint ventures. This requirement was accepted by the U.S., Europe, Japan and other WTO members in the negotiations for China to join the WTO.

As a result of the negotiations, China has the right to require the joint venture approach for the entry of foreign capital in certain specified industries. This is recognized by everyone. It's not only China that does this; developed countries also have such requirements, and a large number of developing countries have such demands. If you want to invest here, produce products, and meet the demands of the local market, you need to make a joint venture.

Let's then take a look at the joint venture: is it asking for a compulsory technology transfer? Some companies say they have to transfer technologies when they form the joint venture, and if they don't do so, nobody will be willing to join them in a business, so this is a compulsory transfer. We say this is not the fact. When you are negotiating a joint venture, you definitely want a good price. If you have technologies, you can get a good price. If you don't have a good price, you will lose money and you will not agree to transfer the technologies.

Who are the parties negotiating this good price? They are foreign enterprises and Chinese partners. They are equal market entities. Negotiations between equal civil entities is a contract-based negotiation. It is a free choice of enterprises. It is an equal consultation and negotiation of enterprises. The government does not play any role in it. The government has no compulsory influence. In fact, many joint ventures are developing very well in China. Ford's joint ventures in China produces more cars than its American plants. Ford's profits in China exceed its profits in the United States.

The Deputy Director of the National Intellectual Property Administration, Mr. He Hua, just mentioned that China's protection of intellectual property rights is highly praised by joint ventures with their satisfaction degree in some cases being more than 80 percent; so, how can you say this is compulsory?

Some people ask, can you waive the joint venture requirements? Let me tell you, we are doing more and more to waive the joint venture requirements. This year, we have timetables for the national negative list and the negative list of the free trade pilot zone to waive requirements for the joint ventures handling the manufacture, maintenance and design of automobiles, aircraft and ships, as well as waive the joint venture requirements for finance, securities, banking, and insurance. However, as far as joint venture requirements are concerned, not only China has them, but other developed countries and developing countries have them, too. We need to negotiate within the WTO framework, and we need to resolve these issues through bilateral free trade negotiations or investment agreement negotiations. Don't use compulsory technology transfer as an excuse to initiate a trade war. This excuse is wrong.

At the same time, I would especially remind everyone that when it comes to "compulsory," some countries now engage in a so-called compulsory technology transfer ban. For example, they impose export restrictions and refuse to export some products and some technologies. This involves government orders and government laws and regulations. This is called compulsory. When enterprises want to sell products to China, or want to sell technologies to China, their government does not allow it. When Chinese companies go to invest in such country, or to acquire a company there, the company is willing to accept such a sale, but the government does not allow it, the laws do not allow it. So, I want to draw your attention to the compulsory technology transfer ban. Thank you.

China National Radio:

Regarding the China-U.S. trade frictions, is there any evaluation or estimation made by the Ministry of Commerce on their influences on China's foreign trade this year? What are the influences? Thank you.

Fu Ziying:

According to China's Customs, from January to August, the total value of China's imports and exports was US$3.02 trillion, increasing 16.1 percent. Specifically, the value of exports was US$1.6 trillion, increasing 12.2 percent; the value of imports was US$1.41 trillion, increasing 20.9 percent.

The figures show that China's import and export have remained stable with a growing momentum. The structure has further improved. The quality and performance are also good. This indicates that in the past few years, China's economic reform with its focus on the supply side, and China's active implementation of opening-up policies and measures have enhanced the competitiveness of Chinese enterprises in the world. Despite the trade frictions, the stable and growing momentum has remained.

Presently, the trade frictions are complicated and keep worsening. Foreign-invested enterprises are faced with a more adverse international environment. How to keep Chinese economy running healthily and steadily under this circumstance? The key is to keep foreign trade stable.

Not long ago, the Chinese central government pondered on a series of policies and measures to keep foreign trade stable and help enterprises to weather the storm. One thing for sure is that these policies and measures will strictly conform with WTO rules.

For instance, we may further increase the export tax rebate rates. Previously, the VAT paid by enterprises for exporting goods were not fully paid back. Now, we are considering following international convention to fully return the VAT of some. There is another example. Enterprises are usually faced with certain risks when entering emerging markets. Therefore, we will follow international conventions to provide exporting enterprises more export credit tools, thus to reduce the risks they are faced with.

These measures will be launched soon. I believe, as long as we stick to economic globalization and international trade liberalization, and we safeguard multilateral trade system and international trade orders, no one can stop the economic and trade cooperation between Chinese enterprises and all the other countries in the world. China is willing to work together with all the other countries to build a community with a shared future for mankind, and to build an open, inclusive, clean and beautiful world that enjoys lasting peace, universal security and common prosperity. Thank you.

Guo Weimin:

If you have more questions, you can contact us via fax and e-mail. We will organize more press conferences and interviews to meet your needs. Now, the press conference is over. Thank you.

.

Read in Chinese

Speakers:

Ning Jizhe, vice director of the Office of the Leading Group for the Belt and Road Initiative, deputy head of the National Development and Reform Commission, head of the National Bureau of Statistics

Qian Keming, vice minister of commerce

Zhang Jun, assistant minister of foreign affairs

Chairperson:

Hu Kaihong, spokesperson for the State Council Information Office of China

Date:

Aug. 27, 2018

Hu Kaihong:

Ladies and gentlemen, good afternoon. Welcome to this press conference. This year marks the fifth anniversary of the Belt and Road Initiative proposed by Chinese President Xi Jinping. 

Today, we are delighted to invite Mr. Ning Jizhe, vice director of the Office of the Leading Group for the Belt and Road Initiative, deputy head of the National Development and Reform Commission and head of the National Bureau of Statistics, Mr. Qian Keming, vice minister of commerce, and Mr. Zhang Jun, assistant minister of foreign affairs to brief us on the progress made under the Belt and Road Initiative over the past five years and its outlook in the future.

Now, Mr. Ning Jizhe will give you a brief introduction.

Ning Jizhe:

Thank you all. This morning, Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, attended the symposium on the fifth anniversary of the Belt and Road Initiative, and delivered an important speech.

Over the past five years, the initiative has witnessed a warm welcome and active participation in countries all over the world. Much headway has been made in the construction of the Silk Road Economic Belt and 21st Century Maritime Silk Road, as the Belt and Road Initiative has developed from a proposal and vision, into concrete activities.

First, enhancing strategic mutual trust and building international consensus. The Belt and Road Initiative and the principle of seeking shared benefits through extensive consultation and joint contribution have been included into many documents of international organizations like the United Nations. So far, 103 countries and international organizations have signed 118 cooperation agreements with China under the framework of the Belt and Road Initiative. 

In 2017, the first session of the Belt and Road Forum for International Cooperation was held successfully in Beijing. State and government heads of 29 countries, as well as more than 1,600 representatives of over 140 countries and over 80 international organizations participated in the event. Of the 279 items on the forum's outcome list, 265 items, or 95 percent of the total, have been completed or have become routine works, while great efforts have been made to accelerate the implementation of the remaining items.

Second, actively implementing cooperation projects to create demonstration effects. Solid progress has been made in a batch of cooperation projects, such as the China-Pakistan Economic Corridor, China-Laos railway, China-Thailand railway, Hungarian-Serbian railway, Jakarta-Bandung high-speed railway, and Gwadar Port Free Zone. As of Aug. 26, 10,000 cargo train journeys have been made on the China-Europe railway lines. The lines connect China with 43 cities in 15 European countries. 

Third, promoting cooperation in the pursuit of win-win results and mutual development. By June 2018, the total volume of trade in goods between China and countries along the Belt and Road had surpassed US$5 trillion, and China's outward direct investment has surpassed US$70 billion. China's total investment in the economic and trade cooperation zones in countries along the Belt and Road has surpassed US$20 billion, creating more than 100,000 local jobs and bringing tax revenue worth billions of dollars to local governments. Currently, Chinese enterprises are exploring ways to work with enterprises from developed countries, including some multinational companies, in third-party markets under the framework of the Belt and Road Initiative. 

Fourth, improving service systems and enhancing financial support. China has endorsed the Guiding Principles on Financing the Development of the Belt and Road with 17 countries, greatly boosting the overseas development of Chinese financial institutions. So far, 11 Chinese banks have set up 71 first-class branches overseas. Joint financing services have been developed with several multilateral banks, such as the African Development Bank, Inter-American Development Bank, and European Bank for Reconstruction and Development. The control of legal risks has been tightened. The mechanisms and institutions to solve international commercial disputes under the framework of Belt and Road Initiative are being established. 

Fifth, intensifying cultural exchange under the principle of openness and inclusiveness. Cooperation has been actively promoted in education, technology, cultural and other fields. Special cooperation plans have been designed in education, technology, finance, energy, agriculture, inspection and quarantine, the connectivity of standards, amid others. The "Silk Road" scholarship, Chinese overseas education institutions and other programs have cultivated many technological and managerial professionals for countries along the Belt and Road. In 2017, more than 300,000 students from these countries studied in China, and more than 60,000 Chinese students studied in these countries. In 2020, it is estimated that China and countries along the Belt and Road will receive more than 85 million tourists from each other, with a total expected consumption value of about US$110 billion.

The development of the Belt and Road Initiative over the past five years has proved that the initiative conforms to the trend of the times and the direction of development, thus winning greater international recognition and more partners, with its influence extending far and wide. However, we should also notice that the global economy is faced with many uncertain and unstable factors. Great changes are taking place in the world. The Belt and Road Initiative is also faced with many risks. A handful of countries remain doubtful about the initiative. Chinese enterprises are also faced with difficulties in overseas investment and development. Therefore, we should have an objective and reasonable understanding of the achievements and problems. We should remain resolved, use development and cooperation to solve problems, improve the safeguard system and international cooperation mechanisms, promote further, deeper development of the Belt and Road Initiative in a stable manner.  

In view of the new situation, the Chinese government will continue to stick to the principle of seeking shared benefits through extensive consultation and joint contribution, stick to the rules of the market economy, and stick to international conventions to promote the high-quality development of the Belt and Road Initiative with high standards, thus to pursue win-win results through cooperation. 

First, we will enhance overseas coordination, build closer friendships with more countries, and turn the Belt and Road Initiative into an initiative for peace. 

Second, we should promote win-win development, intensify mutually beneficial cooperation, improve connectivity and industry development, and turn the Belt and Road Initiative into an initiative for prosperity. 

Third, we should play the leading role in pursuing open markets, boost the development of trade, improve trade and investment facilitation, and turn the Belt and Road Initiative into an initiative for openness.

Fourth, we should enhance the establishment of various mechanisms, explore more ways of reform, promote cooperation in high-tech sectors, and turn the Belt and Road Initiative into an initiative for innovation.

Fifth, we should improve cultural exchange, enhance friendly communication, build up soft power in the cultural sphere, and turn the Belt and Road Initiative into an initiative for higher civilization.

That's all. Thank you.

Hu Kaihong: 

Now, let's welcome Mr. Qian Keming to give his briefing.

Qian Keming:

Friends from the media, since the Belt and Road Initiative was proposed five years ago, the Ministry of Commerce has firmly carried out the central authorities' decisions and deployment, advanced relevant economic and trade cooperation, and achieved remarkable effects, which are mainly embodied in the following five aspects:

First, the trade volume has increased continuously. We actively promote mutual market opening-up, enhance trade facilitation, optimize trade structure and cultivate new growth points in foreign trade. We make full use of the comprehensive exhibitions' roles as platforms, and actively organized trade promotional activities. In the past five years, China's trade volume with the countries and regions along the Belt and Road exceeded US$5 trillion, up an average 1.1 percent annually. We obtained positive growth of 1.1 percent, while world trade declined and witnessed negative growth. China has become the largest trade partner to 25 countries along the Belt and Road. 

Second, investment cooperation has also deepened. We unceasingly strengthen service guarantees, and encourage Chinese enterprises to invest and develop their businesses in countries along the Belt and Road. In the past five years, China's direct investment in these countries has surpassed US$70 billion, which has increased at an average annual speed of 7.2 percent; the foreign contract amount exceeded US$500 billion, up 19.2 percent annually on average. Meanwhile, we have constantly broadened entry fields for foreign investments, aiming to build a high standard business environment and attract these countries to invest in China.

Third, big projects have taken root. We, together with relevant parties, have prompted the materialization of a batch of big projects in infrastructure construction and industrial capacity cooperation. For instance, the Mombasa-Nairobi Railway and Addis Ababa-Djibouti Railway have been completed; the China-Thailand Railway and Hungary-Serbia Railway constructions kicked off; the second phase of the construction of the Hambantota Port was finished; the Gwadar Port in Pakistan re-opened; and the transportation projects of the China-Laos Railway and China-Pakistan Economic Corridor are progressing steadily.

Fourth, the construction of economic and trade zone is steadily advancing. We actively promote the construction of economic and trade cooperation zones with countries along the Belt and Road routes. In the past five years, Chinese enterprises have built 82 such zones, with a total investment of US$28.9 billion, attracting 3,995 enterprises, which have paid US$2.01 billion in taxes to the host countries and created 244,000 jobs for local talent. 

Fifth, the free trade network is continuously expanding. We have accelerated the construction of free trade areas with countries along the Belt and Road, and signed five free trade agreements with 13 countries along the routes. A high-standard free trade network based on neighboring regions, covering the Belt and Road and facing the whole world is in progress. China has signed economic and trade cooperation agreements with the Eurasian Economic Union, and concluded the joint feasibility study of the Eurasian Economic Partnership agreement with Russia. 

It's important to note that China is actively preparing for the China International Import Expo in November, and so far, 138 countries and regions, three international organizations and more than 2,800 enterprises have confirmed their participation in the event.

Hu Kaihong: 

Thank you, Mr. Qian. Now let's invite Mr. Zhang Jun to speak more on the case.

Zhang Jun:

Hi everyone. Just now, Mr. Ning Jizhe and Mr. Qian Keming have already introduced relevant affairs. Now, I'd like to add a bit more information. 

First, looking back on the past five years and the construction of the Belt and Road, we are justifiably feel happy and proud of its achievements. The initiative proposed by President Xi Jinping has carried different peoples' wishes for common development and prosperity, conforms to the practical needs of resolving risks and challenges of the world economy; demonstrates strategic vision of leading and constructing an open world economy, as well as signifies China's constructive role as a responsible country in the world. In the past five years, the initiative has won the hearts of those involved, as well as the wide understanding, recognition, support and participation of the international community, harvesting a bigger circle of friends. Facts show that its construction has come at an opportune time, and is in line with the people's wishes and interests. It has achieved remarkable effects and proved to be the correct path not only for China, but for everyone involved.

Second, five years on, we stand on a new starting point today. We are confident about the prospects of the initiative. Our confidence comes from the correct direction of the initiative. It is in line with the times and trends of peaceful development and win-win cooperation; it upholds the concepts of collective consultation, joint participation, and shared benefits, which complies with the universal wishes of countries around the world to seek coordination and common development. Our confidence comes from the solid foundation of the initiative, which has concepts, proposals, plans, actions and mechanisms, and more importantly the wide support and participation of the international community. The Chinese economy has entered a phase of high-quality growth from its previous phase of high-speed growth. It has a strong driving force, is more open and resilient, and will inject stronger vitality to the initiative's construction.

Third, it takes concerted efforts of all parties to advance the initiative. President Xi has pointed out many times that the initiative stems from China, but belongs to the world. Facing the future, we will uphold the concepts of collective consultation, joint participation and common benefits to further advance the Belt and Road partnership. We will make the people the center, and economic cooperation the main line, focusing on the creation of more development opportunities, so as to bring more blessings to people from home and abroad. We will continue to promote synergy in policies and development plans with various parties and countries so as to achieve interconnected development and realize win-win objectives. We will adhere to opening-up and inclusiveness, welcoming any countries interested in the initiative to take part in it. We do not reject or target any other country. China will host the 2nd International Forum for Belt and Road Cooperation. We welcome all parties to actively take part in it. We will adhere to high quality and high standards, respect different countries' laws, and abide by the widely recognized international standards and market rules. We firmly support multilateralism, and safeguard the multilateral trade system based on the established rules. We are against trade protectionism. We sincerely hope the media can witness very glorious moments of the initiative's construction, tell good stories to the world and highlight the initiative's bright prospects. Thank you all. 

Hu Kaihong:

Now the floor is open. Please identify the media outlet you represent before asking the question.

China Central Television:

Mr. Ning, how can the Chinese government better share the opportunities with countries along the Belt and Road Initiative under the framework of extensive consultation, joint contribution and shared benefits? Thank you.

Ning Jizhe:

I want to answer this very important question from the following three aspects. China, as the world's second largest economy, now contributes over 30 percent to the world's economic growth. China's extensive consultation, joint contribution and shared benefits with the Belt and Road countries is conducive to creating more opportunities for mutual development.

First, in the past few years, China and the countries involved in the Belt and Road initiative have worked together to promote regional economic development and the recovery of the world economy. As you know, the impact of the global financial crisis, which broke out a decade ago, was still felt five years ago. In this economic situation, President Xi Jinping proposed the Belt and Road Initiative which has promoted economic growth and improved people's livelihood through cooperative projects with other countries. For example, countries like Kazakhstan, which champions the "Bright Road" Initiative, also seeks alignment with China's proposed Belt and Road Initiative. Over the past years, Kazakhstan's economy has picked up, Chinese enterprises have developed rapidly in Kazakhstan, and the people of the two countries have benefited from the development. This is only one example, the same is true for China and Southeast Asian countries. Under the backdrop of global economic crisis and the intensive development of the China-ASEAN Free Trade Area, bilateral cooperation between China and Southeast Asian countries achieved much progress under the framework of the Belt and Road Initiative. A large majority of the countries in the region achieved an annual growth rate of around 5 to 7 percent. It has become the region with the most dynamic growth in the world.

Second, joint contribution and shared benefits of the Belt and Road development has expanded two-way trade and investment. The two-way trade between China and the Belt and Road countries has totaled over US$5 trillion, and this rate of growth is faster than the growth rate of trade between China and other regions. Two-way investment between both sides, based on my calculation, is nearly a hundred billion US dollars, which is also growing very quickly. Development opportunities actually lie in two-way investment, trade and personnel exchanges.

Third, joint contribution and shared benefits of the Belt and Road development have also increased complementary advantages and win-win outcomes of all parties. As you know, countries along the Belt and Road, as well as other cooperation partners are mostly developing countries. There are, however, also developed countries, emerging economies and high-income oil-exporting nations. They all have their unique advantages, be it in capital, technology, management, labor, resources or market. Most importantly, the Belt and Road Initiative can utilize their complementarities and share opportunities for development among the countries.

China has long enjoyed a comparative advantage in traditional production and is also now creating new advantages in the areas of capital and management. Other developing countries boast huge markets, while developed countries have clear advantages in the areas of capital and technology. Through bilateral, trilateral and multilateral cooperation, the Belt and Road Initiative can combine all the advantages of countries along the Belt and Road to promote economic development and improve people's livelihood along the route. Thank you.

Lianhe Zaobao:

Earlier you mentioned, China's direct overseas investment for the Belt and Road countries reached over US$70 billion. Some wonder if there will be returns on that huge amount of money. How is the effectiveness and returns of these investments so far? Did it achieve the expected results? In addition, regarding the contribution of these countries along the route, we are aware that many of the Belt and Road projects are funded by loans. Some of these countries, however, seem to have no ability to pay the debt. For example, under a new administration, Malaysia's East Coast rail project has been canceled and the China-Pakistan Economic Corridor may also face uncertainties. Has China learned a lesson from those cases and will China change the way how the Belt and Road Initiative is implemented in the future? Thank you.

Qian Keming:

Your question involves many aspects.

First of all, let me talk about the debt issue. As you know, finance is the lifeblood of economic activities, especially in the initial development stage. I have read several reports on the matter, one of which is by the Asian Development Bank (ADB). It says that a total of US$1.7 trillion of infrastructure spending is needed in Asia every year through 2030. Calculated from the current investment scale, there is still a gap of over US$800 billion investment each year. Another report from the African Development Bank (AfDB) says that a total of US$130 billion to US$170 billion infrastructure investment is needed each year in Africa, and currently only less than one third of the amount is spent. That is to say, Asia is a little better off, it is receiving half of the total investment for infrastructure it needs and missing the other half. Africa is missing two thirds. As is known to all, infrastructure investment plays a very important role in promoting economic growth and increasing people's well-being.

Second, most of China's current investments in the countries under the Belt and Road Initiative are infrastructure related which include the building of railway lines and ports. I believe these infrastructure investments will have a long-term and important role in promoting the economic growth in those countries.

Third, infrastructure investment, mainly on public goods, normally takes a fairly long period of time to show returns. Moreover, after the global financial crisis, international commodity prices dropped significantly. Although they have rebounded slightly, the prices are still far below the pre-crisis level. The price of crude oil reached US$150 per barrel at its peak and then fell back to US$20, US$30 per barrel. Recently, the price rose to around US$70 per barrel, but is still half of the price at its peak. The prices for mineral products have not rebounded much, which hurt the economy in some African and Asian countries. Some of the countries have seen rising debt levels, which is a reality we must face.

Fourth, China has been trying to promote economic development in the host countries through the Belt and Road Initiative and avoid creating too much burden for them. Therefore, we have chosen some projects that can deliver both economic benefits and increase employment, taxes and exports in the countries involved in the Belt and Road Initiative. While embracing bilateral, trilateral and multilateral cooperation, as Mr. Ning mentioned just now, we also welcome involvement from developed countries and multilateral financial organizations to spend and manage the money more efficiently.

Islamic Republic News Agency (IRNA):

I have a question about the cooperation between Iran and China. Iran is one of the important countries along the Belt and Road, so how does China plan to cooperate with Iran under the framework of the Belt and Road Initiative? Thank you.

Zhang Jun:

Thank you for your question, and thank you for conveying Iran's positive attitude towards jointly promoting the Belt and Road Initiative. The Belt and Road Initiative focuses on the Eurasian continent and, at the same time, it is open to global partners as well. Historically, Iran has been an important hub along the Silk Road, making significant contributions to promoting economic and trade cooperation and cultural exchanges between China, Eurasian and European countries.

With the implementation of the Belt and Road Initiative, both China and Iran are facing important opportunities in infrastructure construction, economic and trade cooperation, and cultural exchanges. There is no doubt about this. Thanks to the joint efforts made by the leaders of the two countries, the current relationship between China and Iran has maintained a sound and steady momentum of development. Both sides have reached many important consensuses on jointly promoting the Belt and Road Initiative.

Of course, we should be fully aware of the many practical and potential challenges in implementing the specific cooperative projects. On the one hand, we will make an active effort and take solid steps towards the goal; on the other hand, the two sides will work with the international community to create a more favorable environment and conditions for jointly promoting the Sino-Iranian cooperation and the Belt and Road Initiative.

Economic Daily:

I would like to ask Mr. Ning a question. Presently, some developed countries and large multinational corporations have shown interest in participating in the Belt and Road Initiative in the form of the third-party market cooperation. What considerations does China have in this regard?

Ning Jizhe:

The tripartite cooperation is very important, so you raised a very good question

First of all, third-party market cooperation is an open, inclusive, pragmatic and effective mode for international cooperation. It also reflects the principle of the Belt and Road Initiative, namely seeking shared benefits through extensive consultation and joint contribution. This will help Chinese enterprises and enterprises in other countries, especially those of developed countries and multinational enterprises, to complement each other and jointly inject new momentum into the economic development of third countries.

Second, China has made good progress in working with relevant countries to promote third-party market cooperation and in recent years, China has actively engaged in third-party market cooperation with relevant countries. Presently, we have formally signed cooperative documents on third-party market cooperation with France, Canada, Japan, Singapore and some other countries and international organizations. We have also contributed to the establishment of third-party market cooperation funds with other countries. The following are some examples.

China's Silk Road Fund established a third-party market fund with the European Bank for Reconstruction and Development. The China Investment Corporation also established funds with relevant French financial institutions. All these are being supported and guided by the governments of both sides. Moreover, the third-party market cooperative projects between China and France have achieved early results, and the two sides will expand their cooperation to new projects in the near future. China and the European Union (EU) have also finalized specific projects for third-party market cooperation.

As you all know, during Premier Li Keqiang's visit to Japan, China's National Development and Reform Commission and Ministry of Commerce and Japan's Ministry of Foreign Affairs and Ministry of Economy, Trade and Industry (METI) reached a memorandum of understanding on the third-party market cooperation between the two sides. In order to implement the consensus and ministerial memorandum reached by the leaders of the two countries, we held a seminar on the Sino-Japanese-Thai tripartite cooperation in Thailand last month, possibly a little bit earlier, to finalize specific cooperative projects. The Eastern Economic Corridor of Thailand is led by the Chia Tai Group of Thailand and the CITIC Group of China, with enterprises from Japan participating in bidding the project.

Currently, some developed countries, such as the United Kingdom, and some emerging economies, including China, also share a sincere desire for third-party market cooperation worldwide in promoting the Belt and Road Initiative. This is not only conducive to China, the developed countries and the new economies who participate in the tripartite cooperation, but also conducive to the third country – the host country of the project.

Third, in the future, China will work with relevant countries and enterprises to expand the scope of third-party market cooperation. We will adhere to the principle of seeking shared benefits through extensive consultation and joint contribution, develop new markets for investment, production and operation, and actively innovate on models for cooperation. We will encourage enterprises to open up new markets by means of joint tendering and joint investment so as to complement each other's strengths and achieve win-win results. Thank you.

CRNTT:

I have a question for Mr. Zhang Jun. The Beijing summit of the Forum on China Africa Cooperation is about to be held. We know that the joint development of Belt and Road Initiative is an important topic for China-Africa cooperation. People have talked about Africa as a pilot region for joint efforts to build the "Belt and Road". What do you think of this? What challenges do you think China and Africa face in carrying out the "Belt and Road" cooperation? Thank you.

Zhang Jun:

The construction of the "Belt and Road" is especially targeted at the Asia-Europe-Africa continents, and African countries are one of the key areas for the joint development of the Belt and Road Initiative. As a major group of developing countries, Africa is facing the arduous task of infrastructure construction and economic and social development. Supporting and helping Africa achieve peaceful development and stability has always been one of the priorities of China's diplomacy. For a long time, we have invested a lot in the development of Africa, and have made great achievements.

In recent years, it has been an important part of the Forum on China-Africa Cooperation to inject vitality and motivation for African development through the joint construction of the Belt and Road Initiative. The Beijing Summit will be held in Beijing, with China and Africa having agreed to promote the Belt and Road cooperation in Africa, both sides should strengthen integration and docking between China's development strategy and "Belt and Road" joint contribution, and the Africa's Agenda 2063, as well as strengthening the connection and docking between the United Nations 2030 Agenda for Sustainable Development and the African development strategies. Those will be an important part of this year's Forum on China-Africa Cooperation. Both sides have great expectations for the outcome of the forum.

As far as I know, at the Beijing Summit of the forum, more than a dozen documents on cooperation between China and African countries will be signed, which will further promote and implement the cooperation between China and Africa in joint contribution for the "Belt and Road." At the same time, China-Africa cooperation also has a broader space. For example, during the meeting of the BRICS leaders not long ago, President Xi Jinping met with African leaders and reached a broad consensus on further deepening China-Africa cooperation. An important achievement of the BRICS Summit Johannesburg was the establishment of a new industrial revolution partnership. We look forward to the advancement of the BRICS Partnership on the New Industrial Revolution, which will not only enable Africa and developing countries to address the issues of food, clothing and basic needs of development, but also enable developing countries to catch up with the new industrial revolution and better seize opportunities for development from the process of scientific and technological development in the current world. Under the complex and changing economic situation, we can better meet the challenges and achieve common development with other countries in the world.

Reuters:

With concerns about the increase in debt from this project, if we can expect to see China be more cautious in choosing Belt and Road projects or providing funding for these projects? Thanks.

Qian Keming:

I have already said about the debt issue just now. We have always been paying attention to the selection of projects. The first is wide consultation, which means, the host countries and China consult with each other to propose projects. The second is joint contribution, which means they participate in construction together. The third principle is shared benefits. We have strict procedures for the evaluation of projects, banks, enterprises, including environmental protection, there are strict evaluation procedures.

In the future, we also welcome developed countries and international institutions to actively participate in and jointly select projects with us to ensure that projects are transparent, high-quality and sustainable.

China Daily:

I have a question for Mr. Zhang Jun. You mentioned that China is promoting the construction of the "Belt and Road" with a high quality approach. Some people may not understand it, or have some doubts; what is "high quality"? Can you please explain how "high quality" is reflected in the Belt and Road cooperation projects?

Zhang Jun:

I think that this issue should be viewed comprehensively. In other words, you should go beyond the quality of a particular project. I think the high quality and high standards of the Belt and Road should be demonstrated at least in the following aspects:

First, high quality drives the growth of the world economy. The world economy is facing the problem of insufficient growth momentum. Infrastructure construction is also a bottleneck problem facing the development of various countries. We are promoting the Belt and Road Initiative, in order to further improve and perfect the global supply chain, value chain and industrial chain by strengthening connectivity and interconnection among countries, so that countries in disadvantaged positions can better participate in the world's division of labor, and will benefit more from the global value chain, thereby create greater impetus for their own development and create greater impetus for world economic growth. This is actually what we often say about building an open world economy and promoting the building of a community of shared future for mankind. Is this a high standard of quality? Of course, it is so high. It is in stark contrast to the unilateralism and protectionism pursued by some countries.

Second, the high quality of the "Belt and Road" is reflected in the high quality of addressing the issues for global development. Nowadays, the world faces a problem of imbalance. We call it a development deficit and development imbalance. How to solve these problems? We adhere to the people-centered development concept for 'domestically. In the process of building the "Belt and Road", we still place the people as the center of cooperation, and we strive to improve the conditions for economic and social development through the joint contribution of the "Belt and Road," and improve people's livelihood, enhance people's welfare. We have signed a "Belt and Road" cooperation agreements with relevant UN agencies, that is, through cooperation with the United Nations, we will better align the Belt and Road Initiative with the UN 2030 Agenda for Sustainable Development and push forward the re-balancing of globalization, so that everyone can benefit from a more inclusive, balanced, universally beneficial, and win-win globalization process. This is surely high quality and high standards.

Third, to build the Belt and Road with high quality and standards, we also call for participants to abide by the laws of different countries, international rules and standards and market rules. President Xi has repeatedly stressed the building of a green Silk Road with high ethical standards. We pursue green, environmental-friendly and fiscally-sustainable development in building the Belt and Road. Through cooperation with the UN Environment, we founded the International Coalition for Green Development on the Belt and Road. We have also worked with some countries to formulate the Guiding Principles on Financing the Development of the Belt and Road. All of these provide important support for building the Belt and Road with high quality and standards.

Fourth, to build the Belt and Road with high quality and standards, we also uphold the guiding principle of seeking shared benefits through extensive consultation and joint contribution, though some countries have backed down from multilateralism. Under the guiding principle, different countries can participate in the process of building the Belt and Road and benefit from it, which is a quite advanced concept of high standards. To improve the institutional safeguards for the Belt and Road Initiative, we are working on building the Advisory Council for the Belt and Road Forum for International Cooperation. We will invite international luminaries to join the council and advise us on the initiative. Yesterday, as another sign of pursuing high quality and standards, we set up the International Commercial Expert Committee in a bid to provide legal support for building the Belt and Road.

Of course, our pursuit of high quality and standards in building the Belt and Road is also demonstrated in the building of high quality infrastructure. However, we deem it necessary to make it clear that many of the countries involved in the initiative are developing countries, which means that high-quality and high-standard construction must be in accordance with the basic national conditions and laws of these countries. So, high quality must be achieved at a reasonable price, and should be inclusive, feasible and beneficial to all. It is necessary to keep the balance between high quality and practical use. We hope that the building of the Belt and Road can be both high-standard and practical.

Ta Kung Pao & Wen Wei Po

At the beginning, you mentioned that there are a few countries which have raised questions about the Belt and Road Initiative. Recently, some foreign media reported that the initiative has brought a debt trap for relevant countries, accusing China of attempting to gain controlling interests in projects by providing loans regardless of the host countries' overall liabilities and debt-paying abilities, and thus adding to the countries' debt burden. What are your comments on this?

Ning Jizhe:

First of all, the projects of the Belt and Road Initiative have brought effective investment and valuable assets to relevant countries and contributed to their economic growth and improved livelihood, instead of causing a so-called debt trap. Projects of the Belt and Road Initiative, be they related to connectivity or production capacity cooperation, must go through a sound feasibility study and strict debt approval process. We are the witness, so we are clear on how strict it is to get bank loans. There are requirements about capital contribution, debt-to-asset ratios, and financial returns. If a project doesn't meet the requirements, it will not be allowed to pass. Of course, there are some infrastructure projects that may take a long time to get the investment returns, but the assets are there and they will appreciate in value. 

To our knowledge, the debt issues in some countries as reported by some foreign media are not necessarily connected with the Belt and Road construction and relevant projects. Some countries already have very high levels of debt for many years mainly due to their long-term borrowing from other countries as well as international financial institutions. China is a late comer. It is not the biggest creditor.

Second, for jointly built projects and investment cooperation with relevant countries, China has always attached great importance to debt management. With regard to the investment and financing of the projects under the Belt and Road Initiative, China offers loans to projects based on the conditions of their host countries to avoid increasing the countries' debt risk and fiscal burden. Before offering the loans, Chinese banks will strictly review the borrowers' overall liabilities and debt-paying abilities, and continuously monitor the sovereign risks of relevant countries after offering the loans. For example, the China Development Bank has set up the system of sovereign credit rating and national risk quota management. The Industrial and Commercial Bank of China, China Export and Credit Insurance Corporation and other financial institutions have also established relevant evaluation, monitoring and management systems.

Developing the economy and improving people's livelihood are the primary goals of developing countries. For these developing countries who are in urgent need of money, Chinese banks will also design financing structures to help them sustainably manage their debt, such as the case of the fiber optic cable projects in Cambodia, and Yamal liquefied natural gas project in Russia, of course Russia is not a developing country, but an emerging economy. In any case, all these projects are supported by a system that combines equity investment and bank loans, and have achieved good results.

I would like to answer the questions of the journalist from Singapore about the China-Pakistan Economic Corridor (CPEC). Over the past four years, since the CPEC has been put forward, it has been progressing well and has yielded many profits. In November 2017, both sides signed the Long-term Plan for the China-Pakistan Economic Corridor. Among the projects proposed at the early stage, we have already launched 18 projects, including the building of power plants, which solves the problem of energy shortages that has been plaguing Pakistan for many years. Of course, the CPEC also includes projects relating to transportation, industrial cooperation and ports. I will not list them out one by one here. The new leadership of Pakistan has clearly expressed that the CPEC is not built by any one party or people. It is instead a project that involves the cooperation between all Pakistani and Chinese people, which will definitely become a great success.

Separately, on the East Coast Rail Link project, as some of you have mentioned earlier, as you all know, the Prime Minister of Malaysia Mahathir Mohamad has just concluded his visit to China. He has clearly stressed that his support of China's Belt and Road Initiative, and welcomed Chinese enterprises to expand their investment in Malaysia. He also mentioned the financial difficulties that Malaysia is facing, and hopes that China would offer support to solve some of these issues together.

Hindustan Times:

I just want to ask you if China is willing to address India's concern with the China-Pakistan Economic Corridor (CPEC), especially on other projects which are passing through Pakistan-occupied Kashmir, because India says it violates its sovereignty. 

Zhang Jun:

I have some points to add to this: Firstly, India is an important neighbor of China. Both of them are developing countries with emerging markets. Guided by the leaders of the two countries, China-India relations have shown good momentum and entered a new stage of development. If we take a moment to recall, we can see that since April this year, in just three months, President Xi Jinping and Prime Minister Narendra Modi have held three important meetings in Wuhan, Qingdao of China and Johannesburg of South Africa to reach a broad consensus. This has injected new impetus into the development of bilateral relations.

Secondly, India is historically an important country along the ancient Silk Road. It is regarded as a natural partner to build the Belt and Road Initiative cooperation. The exchanges between the two countries through history have left many interesting tales. As developing countries and emerging markets, the two countries are facing similar developmental tasks. As such they both have a lot of room and potential for cooperation to strengthen infrastructure construction. In fact, both sides have already cooperated in numerous ways in this aspect. As you know, India is a founding member and the second largest shareholder of the Asian Infrastructure Investment Bank (AIIB). Currently, 20 percent of the investment projects of the AIIB are located in India. 

Thirdly, China has repeatedly emphasized that the CPEC is an economic cooperation project. Its implementation will not change China's long-standing position on the Kashmir dispute.

China News Service & Chinanews.com: 

There is a view that the advancement of the Belt and Road Initiative may encounter greater resistance given the current global situation which is undergoing certain changes, especially the rising trade and investment protectionism. Mr. Qian, what measures will the Ministry of Commerce take to further promote the Belt and Road Initiative in this context?

Qian Keming: 

In the next step, we will make solid efforts to promote the Belt and Road Initiative from the following five aspects.

First, making the first China International Import Expo (CIIE) a success. It is known that the expo was planned, announced and promoted by Chinese President Xi Jinping. The expo is by no means an ordinary exposition. Different from the China Import and Export Fair (Canton Fair) which is targeted at boosting the country's exports, the expo is a trade fair focusing on the importation of goods and services. In addition, the expo will be developed into an open cooperation platform for countries in the world to showcase their development achievements and carry out international trade. It will also become an international public product that helps to promote the Belt and Road Initiative and boost economic globalization.

Second, innovating trade and investment cooperation models. In this respect, we will give top priorities to cooperation on key projects and innovative areas. As for key projects, Mr. Ning said just now that we will promote the construction of some important projects along the Belt and Road routes. As for innovative areas, we know that China has been enhancing development in innovative areas such as e-commerce, big data, cloud computing and artificial intelligence in recent years. In boosting the development of the "Silk-Road E-commerce," we mean to take advantage of e-commerce, big data and the newest modern science and technologies in building the Belt and Road Initiative.

Third, accelerating the construction of platforms for opening up, including pilot free trade zones (FTZs), for example the China (Hainan) Pilot Free Frade Zone, as well as cross-border economic cooperation zones and overseas economic and trade cooperation zones.

Fourth, enhancing regional economic integration, at both regional and sub-regional levels. We are willing to work together with the Belt and Road countries and regions to build high-standard FTZs and develop a large market under the Belt and Road Initiative. 

Last, implementing important opening-up measures announced by President Xi, especially the implementation of an across-the-board management system based on pre-established national treatment plus a negative list. We will enhance intellectual property rights (IPR) protection, promote implementation of the WTO Agreement on Trade Facilitation (TFA), and deepen cooperation on achieving compatibility in customs clearance procedures along the routes.

China Arab TV:

After President Xi Jinping's visit to the United Arab Emirates (UAE), what major plans will be introduced to promote the cultural exchanges between China and the UAE as well as other Arab countries? Thank you.

Ning Jizhe:

The UAE is the first stop of President Xi Jinping's first overseas visit after the first session of the 13th National People's Congress. This demonstrates the importance of the cooperation between the two countries. The bilateral cooperation covers a wide range of areas. I have been most involved in the economic exchanges. Many Chinese people have been to Dubai. China COSCO Shipping Corporation Limited and Abu Dhabi Ports are enjoying strong cooperation on the development of Port Khalifa in Abu Dhabi. The port, under rapid construction, is expected to become one of the Chinese shipping company's pivot hubs in the Middle East. The China-UAE Industrial Capacity Cooperation Demonstration Zone is also a highlight of the bilateral economic cooperation. Under the guidance of the development and reform commissions in Jiangsu province, related Chinese companies are working well with their UAE counterparts on the demonstration zone project.

In terms of cultural and tourism cooperation, the number of Chinese tourist arrivals in the UAE has exceeded one million a year. It shows that the UAE and China maintain close people-to-people exchanges. The UAE has granted visa-free or visa-on-arrival treatment to Chinese citizens. A great number of Chinese tourists travel to Dubai during the Spring Festival holiday each year.

The UAE has also taken an active part in global cultural events. In particular, with the UAE set to host the World Expo 2020, more tourists from China and other countries are expected to travel there, thus cementing the friendship between each other. With more coordinated policies, infrastructure connectivity has been enhanced through port cooperation and bilateral ties have been facilitated by the development of industrial zones. In terms of financial integration, the UAE has considerable economic strength, so we are ready to boost trilateral cooperation with the UAE in Africa and embrace more investment from the UAE in China. In addition, the people-to-people ties have also been strengthened. So, China-UAE relationship is an embodiment of "a five-pronged approach" to building the Belt and Road. Thank you.

Zhang Jun:

President Xi Jinping's visit to the UAE, which is the first stop of his overseas trip in July, has delivered productive outcomes. President Xi received a warm welcome from people in the UAE and created an unforgettable experience with them. Both economic cooperation and cultural exchanges are important dimensions of the China-UAE relationship. I believe that the "Embrace China" Initiative launched by the UAE will play a significant role in promoting people-to-people and cultural exchanges among people from the countries along the Belt and Road. To boost such exchanges between each other, China and the UAE are negotiating about building Chinese cultural centers in Abu Dhabi. I think those measures by the two sides will improve our bilateral cooperation in all areas under the framework of the Belt and Road Initiative.

Qian Keming:

I think China and the UAE also enjoy huge potential for cooperation in innovation. I learnt during my recent visit to the UAE that the country has established foundations for innovation. In the building of one foundation, there is a 3D printed office constructed by a Chinese company. The UAE is a country of great creativity and China boasts a number of universities. Beijing Genomics Institute, a Chinese genome sequencing center, is cooperating with organizations in the UAE. So, I think China and the UAE can strengthen cooperation in innovation.

Hu Kaihong:

This concludes today's briefing. Thank you, Mr. Ning, Mr. Qian and Mr. Zhang. Thank you, friends from the press.

Read in Chinese

Speakers: 

Shen Changyu, commissioner of the State Intellectual Property Office

Yu Cike, spokesperson of the National Copyright Administration

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office of China

Date:

April 24, 2018

Xi Yanchun:

Ladies and gentlemen, good morning. Welcome to this press conference. April 26 is annual World Intellectual Property Day. Since you are all very interested in the issues pertaining to this field, today we are delighted to invite Mr. Shen Changyu, commissioner of the State Intellectual Property Office, to brief you on the development of China's intellectual property rights in 2017. He will also answer some of your questions.

Also present at the press conference today is Mr. Yu Cike, spokesperson of the National Copyright Administration.

At this time, Mr. Shen will give you a brief introduction.

Shen Changyu:

Thank you, Ms. Xi. Good morning, friends from the press. Let me begin by thanking the SCIO and friends from the press for your care and support for IPR-related work. Now I would like to brief you on China's IPR development in 2017.

The CPC Central Committee and the State Council made a series of important plans on IPR-related work in 2017. In his report to the 19th CPC National Congress, General Secretary Xi Jinping emphasized that China will "foster a culture of innovation, and strengthen the creation, protection and application of intellectual property." At the first meeting of the Leading Group for Deepening Overall Reform of the 19th CPC Central Committee, Xi stressed that protecting IPRs is equivalent to protecting innovation. Local governments and related departments earnestly studied and implemented Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and the spirit of the 19th CPC National Congress. They made steady efforts toward turning China into a country with strong IPRs, achieving major progress in a number of respects.

First, IPR creation has been improved in both quantity and quality. The number of patent applications over the year rose to about 1.38 million, an increase of 14.2 percent since the previous year, ranking first in the world for seven consecutive years. The number of international patent applications under PCT was 51,000, up 12.5 percent year over year, leaping to second worldwide. The number of patents per 10,000 people reached 9.8. The number of applications for trademark registration was about 5.75 million, up 55.72 percent year over year, ranking first in the world for 16 consecutive years. The number of trademarks registered in total reached 14.92 million. The number of applications for the Madrid International Registration of Marks from Chinese applicants was 4,810, ranking third in the world. The number of works and computer software copyright registered reached about 2 million and 745,400 respectively, up 25.15 percent and 82.79 percent. The number of applications for rights for new agricultural and forestry plant varieties reached 3,842 and 623 respectively. The number of products protected by geographical indications has steadily increased.

Second, China has made steady progress in enhancing its legal system for protection of intellectual property rights. The revision to the Law Against Unfair Competition was adopted at the 30th session of the NPC Standing Committee in 2017. We have seen substantive progress in revising and formulating the Patent Law, Regulations on Patent Commissioning and Regulations on Administration of Human Genetic Resources. We actively promoted the formulation and revision of Copyright Law, Regulations on the Protection of Olympic Symbols, Regulations on National Defense Patents, Regulations on the Protection of New Varieties of Plants and Regulations on Access to and Benefit-sharing of Biological Genetic Resources. We will step up our efforts to introduce the Guidelines on Anti-Monopoly Law Enforcement in the Field of Intellectual Property Rights. We will deepen research on the system for intellectual property rights protection of innovation achievements in new areas and business forms.

Third, the protection of intellectual property rights was more stringent. Administrative organs handled 67,000 cases related to patents, an increase of 36.3 percent year-on-year. They also handled 30,100 cases related to trademark, with a total worth of 333 million yuan. The copyright department investigated and dealt with more than 3,100 cases related to copyright infringement and piracy, and confiscated 6.05 million pirated products. Customs seized 19,200 batches of import or export goods that infringed on intellectual property rights. The cases involved 40.95 million goods with a total worth of 182 million yuan. Courts all over the country accepted 213,500 civil, administrative and criminal cases of first instance related to intellectual property rights. Of them, 203,000 cases were concluded. The number of cases accepted and concluded increased 40.37 percent and 38.38 percent respectively year-on-year. The procuratorial organs approved the arrest of 4,272 people involved in 2,510 intellectual property crimes. They also prosecuted 7,157 people involved in 3,880 lawsuits. The public security agencies solved 17,000 criminal cases concerning intellectual property right infringement and the production and sales of fake or inferior goods, with a total worth of 6.46 billion yuan. They also gave particular supervision over the handling of 44 major intellectual property rights infringement cases. A series of special law enforcement actions were taken. In an investigation on the public satisfaction with intellectual property rights protection, the public scored 76.69 for related works. Fourteen intellectual property rights protection centers were established. A nationwide network was established to provide legal aid concerning intellectual property rights protection and to accept tips and complaints of intellectual property rights infringement. Attempted steps have been taken to explore the establishment of a mechanism to coordinate the protection of the trademark rights of Chinese corporations overseas. The building of a long-term mechanism to promote the use of genuine software programs is in full swing. A campaign was launched to check the use of genuine software programs in 389 institutions in 16 provinces, autonomous regions and municipalities directly under the central government.

Fourth, the efficiency of utilizing intellectual property rights (IPRs) has been markedly improved. We have been improving the supporting mechanism for the transfer and commercialization of scientific and technological achievements, speeding up the implementation of the National Fund for Technology Transfer and Commercialization, and promoting the construction of demonstration zones for the transfer and commercialization of national scientific and technological achievements. The national public service platform for the operation of IPRs took shape as the pilot commercialization centers in Xi'an and Zhuhai were established and put into operation. Operation funds for IPRs in key industries have been launched in succession, and the total fund raised has exceeded 4.2 billion yuan (US$665.13 million). Trademark and brand innovation and entrepreneurship bases were built to promote regional brand building based on industrial clusters. Copyright transaction centers and copyright trade bases were actively nurtured, and 10 national copyright transaction centers have been set up nationwide. The amount of patent pledge financing reached 72 billion yuan (US$11.4 billion), an increase of 65 percent year-on-year; the amount of trademark and copyright pledge financing reached 36.9 billion yuan (US$5.84 billion) and 5.98 billion yuan (US$947.2 million) respectively. The amount of patent insurance was 9.99 billion yuan (US$1.58 billion), an increase of 170.6 percent year-on-year. The total amount of import and export of IPR royalties exceeded US$30 billion.

Fifth is about deepening the reform in key areas of intellectual property rights. We have improved the policy of tax deductions for research and development expenses, sped up the reform on the distribution of intellectual property rights and strengthened the management and classification evaluation system for intellectual property rights in the implementation of national science and technology projects.

The one-stop service involving rapid patent examination, determination and protection as well as a new model of patent pledge financing have been included in the promotion list to support innovation and reform solutions by the State Council. We have continued to promote the reform on streamlining administration, reduced or canceled patent expanses totaling 5.8 billion yuan, and reduced the submission of various kinds of materials by about 2.7 million copies.

We have deepened the reform on facilitating trademark registration and established 105 windows for handling local trademarks as well as 49 centers for handling applications for the registration of pledge of exclusive rights to use a trademark. We have continued to promote the strict system for trademark examination, and accordingly the cycle of trademark registration has been shortened from nine months to eight months. 

We have strengthened the supervision of authentication institutions for overseas copyrights and handled the re-registration of six authentication institutions for foreign copyrights. We have continued to improve national copyright demonstration work and selected 35 demonstration units and five demonstration parks (bases).

Sixth, we have deepened international cooperation and the exchange of intellectual property rights. We signed an agreement with the World Intellectual Property Organization to strengthen "Belt and Road" intellectual property cooperation and signed a memorandum of understanding for judicial exchange and cooperation. Cambodia has become the first country to recognize the results of China's patent authorization within its own borders.

We have included relevant content on strengthening intellectual property cooperation into the BRICS Leaders Xiamen Declaration, continued to boost international cooperation in the field of trademarks, and promoted the Madrid System on international trademark registration. We have hosted the 2017 Worldwide Symposium on Geographical Indications, made substantive progress in the negotiations for agreement on geographical indications between China and the EU, and signed a memorandum on the negotiations for agreement on cooperation and protection regarding geographical indications. We have promoted an early entry into force of the Beijing Treaty on Audiovisual Performances, and 19 countries have ratified or joined the treaty. 

The above is the development of China's intellectual property rights in 2017. Thank you.

Xi Yanchun:

Thank you to Mr. Shen Changyu for the introduction. The floor is now open to questions. Please identify your media outlet before asking your questions.

CCTV:

At the Boao Forum for Asia annual conference recently concluded in China, President Xi Jinping emphasized that enhancing the protection of intellectual property rights is one of the important measures for further opening up. I've got a question for Mr. Shen. What concrete measures will be taken to enhance the protection of intellectual property rights? Thank you. 

Shen Changyu:

Thank you for your question. As you mentioned just now, at the Boao Forum for Asia 2018, with a straightforward stance, General Secretary Xi Jinping reinforced the protection of intellectual property as one of the four major measures to expand openness, once again conveying to the world the firm position of the Chinese government on strictly protecting intellectual property rights by law. His speech has won wide acclaim from the international community. The State Intellectual Property Office (SIPO) has since studied and deployed the work of implementation. Focusing on realizing the spirit of General Secretary Xi's important instructions, we will coordinate the related parties to improve the protection of intellectual property rights, speed up the formation of a protection system covering aspects such as authorization and confirmation of rights, law enforcement, judicial protection, arbitration mediation, and self-discipline, so as to provide a more powerful guarantee of the rule of law for innovators and market players.

We will further strengthen the protection of intellectual property rights in the following four aspects.

The first is to take the opportunity to re-structure the SIPO to actively guide the comprehensive law enforcement of patents and trademarks and to better combat all types of infringement.

Second, we will take the opportunity to revise the Patent Law of the People's Republic of China as a way to expedite the establishment of a punitive compensation system for infringement, so as to raise the cost for IP infringement substantially and fully unlock the deterring effect of the relevant laws.

The third is to regard the construction of intellectual property protection centers as the starting point, and to reduce the time required for authorization, confirmation and protection of rights by establishing more convenient, efficient, and low-cost channels for rights protection. At present, we have established 19 such centers throughout the country. This year we will further expand the scale and improve the layout of these centers. The centers work quite well though they have been established for only a short time; this year we will further optimize the layout.

Fourth, we will take the 40th anniversary of reform and opening up as an opportunity to deepen international cooperation on intellectual property rights, to promote the building of more open, inclusive, balanced, and effective international rules regarding intellectual property rights so that China's intellectual property rights can also be well protected in foreign countries. We hope these measures can create a favorable international environment for Chinese companies "going global."

Thank you.

China Daily:

I would like to raise a question to Yu. Tencent Music and Netease Cloud Music have reached consensus on internet music copyright cooperation, authorizing music to each other. This has caught widespread attention. How will the people benefit from this cooperation? And what concrete measures have the National Copyright Administration taken to promote the development of the internet music industry ?

Yu Cike:

I appreciate your care about the copyright work. Music is one of the main media spread via the internet. The internet music industry has many customers and major influence. The two companies' cooperation is good news to music fans, who can enjoy more music on the internet. This is also good for the authorization and spread of the internet music resources. Meanwhile, it will also play a positive role in maintaining good protection for network music and building a good ecology for internet music. 

In 2015, the National Copyright Administration organized a special campaign on internet music copyright protection. Over the past few years, piracy and copyright infringement have been effectively checked, and the circumstances of network music copyright protection have improved markedly. On this basis, we are thinking about the way to promote a wider spread of works of music while strengthening the internet music copyright protection. This is a very important issue concerning whether the internet music industry can develop faster. 

To do so, the National Copyright Administration has strengthened its supervision and coordination, and has taken some additional measures. First, the administration communicated with the main internet music service providers and the music companies, urging them to promote internet music authorization and wide distribution of music, avoiding exclusive authorization. They are encouraged to explore internet music authorization and operation models that are in line with market laws and internet conventions.

Second, the administration has further strengthened its supervision of the copyright protection of internet music, demanding the music service providers and companies reinforce copyright protection of internet music resources, and actively form a good internet music copyright ecology. Third, relevant internet music service providers are asked to settle their disputes over copyright properly, and actively engage in cooperation in regards to internet music copyright.

The two companies' cooperation is the fruit of the administration's efforts to protect internet music copyrights, and also of the administration's efforts to promote the distribution of internet music. It is also an action of the internet music service providers so as to offer better services to internet users, and an active measure to maintain the healthy development of the internet music industry. There have been a few small setbacks and issues in the cooperation, but this will not influence the overall trend and direction of development.

The administration will continue to urge the relevant parties to abide by the laws and rules on copyright protection as well as market rules and international conventions, to build a developed, orderly, regulated and sustainable models for internet music authorization and operation through quality services, fair competition and differentiated development, so as to promote the prosperous and healthy development of the internet music industry. Thank you. 

People's Daily overseas edition:

The State Intellectual Property Office was restructured as part of China's deepening reform of Party and state institutions. Mr. Shen, could you inform us about the functions of the new agency and the progress of the restructuring? Thank you.

Shen Changyu:

In order to solve long-standing problems caused by the separated administration and overlapping enforcement of patents, trademarks and geographical indications, as well as improve the management mechanisms of IPRs, the CPC Central Committee decided to regroup the State Intellectual Property Office as part of the deepening reform of Party and state institutions.

The new agency has the following functions:

1.Promoting the implementation of the national intellectual property strategy, especially strengthening the creation, protection, and application of intellectual property.

2.Protecting intellectual property, facilitating the construction of an IPR protection system and offering guidance on the administrative law enforcement of patents and trademarks.

3.Conducting registration and administrative adjudication of trademarks, patents and geographical indications.

4.Coordinating foreign-related IP work and conducting foreign-related negotiations in the IP sector according to different categories.

We are making planned, progressive and disciplined efforts to advance the restructuring of the agency in accordance with the requirements of the CPC Central Committee.

Thank you.

Reuters: 

We know that IPR is a sensitive topic when it comes to foreign companies in China. Some foreign companies complain that China does not provide enough protection of IPR or that they are forced to do some related IPR transfer in order to do business in China. Do you think these complaints are reasonable? With the current trade dispute between China and the U.S., IPR is also one of the important topics of discussion. In your view, will China respond to these appeals by the U.S. through relevant negotiations between China and the U.S.? And will China make adjustments to its IPR policies ?

Shen Changyu: 

Thanks for the question, which is indeed a very important issue.

Over recent years, China has continued to strengthen its protection of intellectual property rights. Equal importance has been given to domestic and foreign enterprises. These efforts have won high praise from the international community. Last year, the Anti-Unfair Competition Law was amended, with sections on protecting business secrets further improved. Influential figures and sources in the U.S. intellectual property right industry have agreed that China's protection of intellectual property rights is now among the top-ranked of all middle-income countries. More and more foreign patent-holding entities chose to sue non-Chinese companies in China, because they believe they can receive equal treatment here. 

Additionally, China has continued to pay royalties in accordance with international trade rules. Last year, the royalties paid by Chinese entities to overseas entities reached US$28.6 billion, more than US$20 billion higher than the received. In particular, the royalties paid to U.S. entities increased 14 percent year-over-year. This shows that China has remained a strong defender, important participant and active builder of international trade rules. In recent years, tremendous progress has been made in the intellectual property rights industry, especially in the protection of IPR.

I want to stress an issue here. In the future, China will further strengthen its efforts to protect intellectual property rights. This is not only because of our need to fulfill international responsibilities, but also because of our need to promote self-development. President Xi Jinping has pointed out that China needs to strengthen the protection of intellectual property rights, as it is a requirement of both foreign enterprises and Chinese companies. As a next step, we will follow President Xi's instruction and the government work report to further improve the protection of intellectual property rights, foster a better environment for business and innovation, attract more foreign enterprises to invest in China, and open wider to the outside world.

The Sino-U.S. trade issue you just mentioned concerns intellectual property rights. To be frank, from our perspective, the so-called Section 301 investigation against China failed to see or ignored China's efforts in this field. Many influential figures in the U.S. intellectual property right industry have agreed that China has made remarkable achievements in this regard. I think our efforts have been recognized internationally. Thank you.  

Economic Daily:

I have two questions for Mr. Cui. First, what measures has the Trademark Bureau taken in respect to deepening trademark registration facilitation reform, strengthening the protection of the exclusive use of trademark and cracking down on trademark infringements? Second, this year's government work report has put forward a requirement to substantially shorten the trademark registration cycle; what measures will be taken next to implement this policy, curb malicious trademark registration and strengthen the protection of the exclusive use of trademark? Thank you.

Cui Shoudong:

The first question is about our work on facilitating and supervising trademark registration in recent years. Under trademark law, our bureau's functions include trademark registration and management. We have done a lot of work, especially since 2016, on registration facilitation. Therefore, when we summarized our work from last year, we said 2017 had witnessed our greatest efforts on reform and most effective achievements. We have introduced several documents, including those concerning the deepening reform of trademark registration facilitation, improving the efficiency of trademark examination and implementing trademark brand strategies. 

I think our efforts have generated obvious effects after one year's work.

First, we have broadened the application channels, shortened the investigation period, and optimized the investigation procedures. Currently, there are 123 counters nationwide accepting trademark applications. Almost all major cities, cities at the prefectural level and above, and county-level cities have such offices. This was a reform in 2016. Since the pilot reforms in Ya'an and Taizhou cities in May 2016, we have established 123 such counters, and 58 counters for registration of pledge. Previously, only the trademark hall accepted trademark applications. Now there are more channels, among which the counter is an important one. 

Second, we have founded trademark investigation cooperation centers outside Beijing. There are three such centers in Shanghai, Chongqing and Guangzhou. The Guangzhou center was founded prior to the ones in Shanghai and Chongqing, which has made trademark registration more convenient. We plan to found trademark investigation centers in Henan and Shandong provinces. This is an institutional reform. Furthermore, we have made the internet an important application channel. All applicants have been able to submit their trademark applications on the internet since March 10, 2017, and 23 kinds of businesses related to trademark can be directly submitted and processed via the internet. In 2017, 4.897 million trademark applications were made on the internet, 86 percent of the total, and 23 percentage points higher than five years ago.

Third, the procedures have been optimized. The investigation period of trademark has shortened from nine months in 2014, which is stipulated by the Trademark Law, to eight months due to our efforts last year, and we plan to further shorten it to six months. And it takes two months now to issue the notice of acceptance of trademark instead of six months. Over the past two years, we have unveiled important reform measures almost every one to two months. The procedures, like the international registration and geographical indication applications, have been greatly simplified. We have issued e-notices to 500 agencies and counters. This is an important reform. We issue 19,600 such e-notices every day on average, and the delivery efficiency is much higher than before. 

There is another important reform. By implementing the State Council's reform to streamline administration, delegate powers and improve regulation and services, we have reduced trademark application fees, and helped ease the applicants' financial burdens. From April 1, 2017, the trademark application fee was reduced from 600 yuan to 300 yuan, and the other fees have also been markedly lower. We have done a lot of work to facilitate trademark registration.  

In an effort to better regulate the registration of trademark, we take measures to prevent malicious registering, as well as to further facilitate the registration of trademark, which are two major parts included in the protection of intellectual property rights. During the investigation process, we mainly focus on taking strict measures to fight against trademark registration with outright malicious intentions, and those which do not align with the principles of honesty and credibility. By taking all these measures, we will crack down hard on infringement and counterfeiting. In 2017, we investigated and handled 30,000 violations of laws or regulations, with a total value of 365 million yuan. Great achievements have been made in registration and management. Firstly, we strengthened the management of major cases, accumulating the efforts to fight against trademark infringement. Secondly, we launched projects targeted at the sources of trademark infringement. Thirdly, we made more efforts to protect foreign investment companies. We also stepped up efforts to protect the legal rights of Chinese companies overseas. Fourthly, we made innovations in the method of regulation. With the help of the National Enterprise Credit Information Publicity System, we promoted our classified regulation on risk management.

Starting from April 20, the Trademark Office has been officially included in the State Intellectual Property Office. In past years, the Trademark Office stuck to a problem-oriented direction. Development will not be realized without the reform. In the future, we will deepen the reform to better facilitate trademark registration.

Recently we issued a three-year crucial plan for the reform of trademark registration facilitation. We have reported it to the State Council and also publicly published this plan. The key point of the plan is that the trademark review period has been shortened from seven months last year to six months this year; it will be shortened to five months next year and to four months by the year 2020. How do we see the four-month period? It will be the fastest among the OECD member countries at present and the fastest among countries that implement the relative grounds examination system. This is because China's trademarks application volume is so large; for example, there were 1.52 million entries in the first quarter of this year alone, an increase of more than 80 percent year-over-year. In some developed countries, their annual application volume is only 500,000 to 600,000, while we can reach more than 600,000 within a month. Some other procedures, including trademark changes, transfers, renewals and revocations, need to be simplified. We must reduce fees and charges, and greatly ease the process for applicants. You can check our three-year plan for details, which has already been made public.

With regard to supervision, through this institutional reform, under the direct leadership of the State Intellectual Property Office, we will take more stringent measures to combat infringement of intellectual property rights and counterfeits, in order to protect intellectual property rights.

Lianhe Zaobao:

I have two questions. First, the report on intellectual property rights protection in China 2017 mentioned that there was a decline in the number of intellectual property rights infringement crimes punished in China. Cases dealing with the sale and counterfeiting of registered trademarks and with the illegal manufacturing of trademarks saw year-over-year declines. It may be interpreted as a sign that the intensity of law enforcement was dwindled; what do you think about this? Second, I want to continue the question from Reuters. We have seen efforts from China toward the protection of intellectual property rights. However, by outside impressions, much remains to be done. For instance, a report from the China Chamber of Commerce in the United States mentioned that 94 percent of U.S. enterprises think their intellectual property rights have not been protected in China. How will China change this impression? You have said that Chinese enterprises also have this need, so will China enhance protections in order to serve Chinese enterprises or overseas ones ?

Shen Changyu:

Thank you for your two questions. Just now you found in the white paper that there was a year-over-year decline in the number of cases of dealing with intellectual property rights infringement crimes in China. This reflects, from one angle, that the protection of intellectual property rights has been enhanced in China. This decline gives a concrete expression. In recent years, China has dealt severely with all cases of intellectual property rights infringement, the environment has been improved, efforts have intensified and cases have seen a decline. 

Second, you mentioned intellectual property rights protection for Chinese enterprises or overseas ones. There are four key qualities of intellectual property rights protection: it should provide strict, extensive, rapid and equal protection. This means we will follow a strict system, set up a coordinated blueprint and a rapid, easy, effective and low-cost rights-defending channel especially for small, micro- and medium-sized enterprises, and treat intellectual property rights of domestic and overseas enterprises equally. These are the basic principles. We will treat private and state-owned enterprises the same, large, small and micro-enterprises the same, units and individuals the same. Therefore, intellectual property rights protection for domestic enterprises is no different than for overseas ones. Thank you.  

Nihon Keizai Shimbun:

The draft foreign investment law has been included in the State Council's legislative agenda for the year 2018. Some experts pointed out that the law contains the Regulations on Technology Import and Export Administration, and therefore, the regulations are likely to be abolished. Is this news true? Thank you.

Shen Changyu:

Thank you for your question. I think the question you raised is very important and meaningful. I suggest you contact corresponding departments to find out relevant information about the situation. At the same time, I will further size up the situation and provide feedback on the information in a timely manner. Thank you.

Reuters Video:

Thank you very much for your detailed response to my colleague's question earlier about intellectual property concerns among foreign companies. Could you put it very simply: Do you recognize any of their concerns?

Shen Changyu:

Thank you for your question. China began to establish and develop its intellectual property rights protection system during the implementation of the reform and opening up policies. In no more than four decades, much progress has been achieved in this regard. Intellectual property rights infringement can be seen worldwide, with various forms and levels of severity at different stages of evolution. However, the Chinese government has demonstrated strong resolve and taken effective measures to protect intellectual property in accordance with the law in past years. The improvement in China's environment for intellectual property protection has been widely acknowledged by the international community. In my prior report, I introduced the measures China has taken to crack down on infringement activities, including those measures in administrative law enforcement and judicial protection. I'm convinced that China's environment for intellectual property protection will become increasingly favorable in the future. Thank you. 

Xi Yanchun:

Every year in late April, Mr. Shen and other officials from the Intellectual Property Office will elaborate on the progress China has made in intellectual property protection, as well as China's determination and future plans related to intellectual property protection. We appreciate your continued attention to China's protection of intellectual property. Thanks to our spokesman, and thank you all. That's all for today's press conference.

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Read in Chinese

Speakers:

Xing Zhihong, director general of Department of Comprehensive Statistics and spokesman of the National Bureau of Statistics

Chairperson:

Xi Yanchun, spokeswoman of the State Council Information Office

Date:

April 17, 2018

Xi Yanchun:

Ladies and gentlemen, good morning. Welcome to this press conference. Today, we invited Mr. Xing Zhihong, director general of the Department of Comprehensive Statistics and spokesman of the National Bureau of Statistics, to introduce China's economic performance in the first quarter of 2018. He will also answer some of your questions.

Now, Mr. Xing will give you a brief introduction.

Xing Zhihong:

Good morning, friends from the press. Glad to meet you. As usual, I will report to you the national economic performance in the first quarter of this year and then take your questions.

The national economy saw a good start in the first quarter.

This year, under the leadership of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at its core, all localities and departments strived for progress while working to keep performance stable, upheld China's new development philosophy, followed the requirements of promoting high-quality development, focused on establishing a modernized economic system, and implemented relevant policies with great effort. As a result, we maintained steady and sound economic development, promoted the transformation and upgrading of industries, improved quality and efficiency of development, and got off to a good start. 

According to preliminary estimation, the GDP in the first quarter reached 19.8783 trillion yuan, up by 6.8 percent year-on-year in comparable prices. From the perspective of industry, the added value of the primary, secondary and tertiary industries totaled 890.4 billion yuan, 7.7451 trillion yuan and 11.2428 trillion yuan respectively, up by 3.2 percent, 6.3 percent and 7.5 percent year-on-year. 

1. Agricultural production went well.

In the first quarter, the output of pork, beef, mutton and poultry was 23.16 million tons, up 1.8 percent year-on-year; the output of pork was 15.43 million tons, up 2.1 percent. The number of pigs bred was 415.23 million, down 1.2 percent year-on-year; the number of pigs slaughtered was 199.83 million, up 1.9 percent. In March, overall weather conditions in major farming areas were favorable, and sunlight and soil moisture in most of these regions were appropriate. Spring plowing and sowing have been going well. 

2. The overall industrial production was stable.

In the first quarter, the value added of industrial enterprises above the designated size actually increased by 6.8 percent year-over-year, and the growth rate fell by 0.4 percentage point compared with the growth from January to February, which was the same as the figure of the same period of last year. 

In terms of economic types, the value added of state holding enterprises increased by 7.9 percent, and the value added of collective enterprises increased by 0.1 percent, while that of share-holding enterprises rose by 7 percent and that of foreign-invested companies and Hong Kong-, Macao- and Taiwan-invested companies rose by 5.5 percent. 

Looking at the three categories, the value added of the mining industry increased by 0.9 percent year-over-year, that of the manufacturing industry increased by 7.0 percent, while electricity, heat, gas and water production and supply industries increased by 10.8 percent. New products from the new industries have developed rapidly. The value added of high-tech and equipment manufacturing increased by 11.9 percent and 8.8 percent respectively year-over-year, which was faster than that of the industries above the designated size by 5.1 and 2 percentage points, respectively. Integrated circuit production output increased by 15.2 percent year-over-year, new energy vehicles increased by 139.4 percent, and industrial robots increased by 29.6 percent. The output sales ratio of industrial enterprises above the designated size reached 97.9 percent, which was 0.3 percentage point higher than the same period of last year. 

In March, the value added of industries above the designated size increased by 6 percent from the previous year, and increased by 0.33 percent compared with the previous month. In March, the manufacturing industry's purchasing managers' index (PMI) was 51.5 percent, up 1.2 percentage points from the last month.

From January to February, national industrial enterprises above the designated size achieved a total profit of 968.9 billion yuan, a year-over-year increase of 16.1 percent. The profit margin for primary business income of industrial enterprises above the designated size was 6.1 percent, an increase of 0.33 percentage point over the same period of the previous year.

3. Services sector grew at a relatively fast pace. 

In the first quarter, the index of services production increased by 8.1 percent year-on-year, 0.1 percentage point higher than the first two months of this year and 0.2 percentage point lower than the same period last year. 

Information transmission, software and information technology services, and leasing and business services delivered a strong performance. In March, the index of services production grew by 8.3 percent year-on-year, 0.3 percentage point higher than that of the first two months, the same rate as the same period in 2017. In the first two months, the operating revenues of service sector enterprises above the designated size increased by 14.1 percent year-on-year, 0.7 percentage points higher than the same period last year. 

In March, the business activity index for services stood at 53.6 percent, 0.2 percentage points lower than the previous month but still higher than last year's average. The business activity index for sectors such as rail transport, air transport, postal and express delivery services, telecommunications, radio and television broadcasts and satellite transmission, Internet and software information technology services, monetary and financial services, capital market services and insurance stayed within the relatively prosperous range of over 55.0 percent. 

As for market expectations, the business activity expectation index for the service sector stood at 60.1 percent, higher than the 60.0percent for the last ten consecutive months.

4. Private investment increased at a faster rate.

In the first quarter, the national fixed-asset investment (excluding rural households) was 10.0763 trillion yuan, increasing 7.5 percent year-over-year, 0.4 percentage point lower than the growth rate of the first two months of the year, and 1.7 percentage points lower than the same period of last year. In particular, private investments reached 6.2386 trillion yuan, increasing 8.9 percent year-over-year, 0.8 percentage point higher than the growth rate of the first two months, and 1.2 percentage points higher than the same period of last year. 

Specifically, investments in primary industry totaled 290 billion yuan, increasing 24.2 percent. Investments in secondary industry totaled 3.5813 trillion yuan, increasing 2.0 percent. Of those, investments in the manufacturing industry increased 3.8 percent. Investments in tertiary industry totaled 6.2050 trillion yuan, increasing 10.0 percent. Of those, investment in infrastructure increased 13.0 percent. One thing to note is that investments in the high-tech manufacturing industry increased 7.9 percent yearly, 0.4 percentage point higher than the overall investment growth rate. On a monthly basis, the fixed-asset investment (excluding rural households) in March increased 0.57 percent.

5. The floor space of commercial buildings for sale continued to decrease.

In the first quarter of this year, total investment in real estate development was 2.1291 trillion yuan, a 10.4-percent growth year-on-year. The growth rate was 0.5 percentage point higher than that in January and February, exceeding that of last year's same period by 1.3 percentage points. In particular, the investment in residential buildings increased by 13.3 percent. 

The total floor space of houses newly started in the first three months was 346.15 million square meters, up by 9.7 percent year-on-year. The floor space of residential buildings newly started went up by 12.2 percent. The floor space of commercial buildings sold was 300.88 million square meters, up 3.6 percent, of which the floor space of residential buildings sold grew by 2.5 percent. The total sales of commercial buildings were 2.5597 trillion yuan, up 10.4 percent. Specifically, the sales of residential buildings rose 11.4 percent. 

The land space purchased by real estate development enterprises was 38.02 million square meters, up 0.5 percent year-on-year. By the end of March, the total floor space of commercial buildings for sale was 573.29 million square meters, 11.38 million square meters less than at the end of February. The fund in place for real estate development enterprises in the first quarter reached 3.6770 trillion yuan, up by 3.1 percent year-on-year.

6. Market sales remain active.

In the first quarter, the total retail sales of consumer goods reached 9.0275 trillion yuan, an increase of 9.8 percent year on year. The growth rate was 0.1 percentage points higher than that from January to February, and 0.2 percentage points lower than the same period of last year. Analyzed by locations for business units, the retail sales of consumer goods in urban areas reached 7.7096 trillion yuan, up by 9.7 percent, while that of consumer goods in rural areas rose 10.7 percent to 1.3179 trillion yuan. 

Grouped by consumption patterns, the revenues from the catering sector were 971.1 billion yuan, up by 10.3 percent, while commodity retail revenues were 8.0564 trillion yuan, up by 9.8 percent. The sales of goods for consumption upgrade grew faster, and cosmetics above the limitation unit, with household appliances and audio-visual equipment witnessing a year-on-year growth of 16.1 percent and 11.4 percent respectively, 6.2 and 3.4 percentage points faster than the same period of last year respectively. In march, the total retail sales of consumer goods increased 10.1 percent on a year-on-year basis, 0.4 percentage point faster than that from January to February, and up by 0.73 percent from the previous month.

In the first quarter, online retail sales rose 35.4 percent from a year earlier to 1.9318 trillion yuan, an increase of 3.3 percentage points over the same period last year. Among them, online retail sales of physical goods reached 1.4567 trillion yuan, up by 34.4 percent, accounting for 16.1 percent of the total retail sales of consumer goods, and an increase of 3.7 percentage points over the previous year. Online retail sales of non-physical goods reached 475.1 billion yuan, an increase of 38.7 percent.

7. The foreign trade surplus shrank greatly.

In the first quarter, imports and exports reached 6.7516 trillion yuan, up 9.4 percent. China's exports increased 7.4 percent to 3.5389 trillion yuan while imports increased 11.7 percent to 3.2127 trillion yuan. The foreign trade surplus shrank 21.8 percent year-on-year to 326.2 billion yuan. The trade structure has been further improved. The general trade of imports and exports increased by 13.2 percent, accounting for 58.3 percent of the total imports and exports, up 2 percentage points from the previous year. About 59.4 percent of the exports were mechanical and electrical products, with an increase of 9.5 percent. The exports and imports to the three largest trading partners of China have maintained a high growth rate, up 8.2 percent, 6.3 percent and 13.7 percent to the EU, the United States and the ASEAN respectively. In addition, China's exports and imports to some targeted countries involved in the Belt and Road Initiative maintained a sound momentum growth, with an increase of 20.5 percent, 16.6 percent and 16.2 percent to Russia, Poland and Kazakhstan respectively. The total volume of exports and imports reached 2.2453 trillion yuan in March, dropping 2.5 percent. Exports fell 9.8 percent to 1.1078 trillion yuan and imports up 5.9 percent to 1.1375 trillion yuan.

In the first quarter, the delivery value of exports of industrial enterprises above the designated size reached 2.7145 trillion yuan, increasing by 7.6 percent year on year, and it grew 4.0 percent to 1.0016 trillion yuan in March.

8. The Consumer Price Index (CPI) and the Producer Price Index (PPI) registered moderate growth.

In the first quarter of this year, China's CPI rose 2.1 percent year-on-year, 0.1 percent lower than the growth rate of the first two months and 0.7 percent higher than that of the same period last year. The figure comprised increases of 2.2 percent in urban areas and 2.0 percent in rural areas. In view of industrial categories, the price of food, cigarettes and alcohol increased by 1.9 percent year-on-year; wares by 1.2 percent; accommodations by 2.4 percent; daily necessities and services by 1.6 percent; traffic and telecommunication by 0.7 percent; education, culture and entertainment by 2.2 percent; medical and healthcare services by 6.0 percent and other services by 1.4 percent.

Amid the prices of food, cigarettes and alcohol, those of crops went up by 1.1 percent, pork went down 9.9 percent and fresh vegetables went up 6.6 percent. In March of this year, the CPI rose 2.1 percent year-on-year, 0.8 percentage points lower than the growth rate in February, and 1.1 percent lower than the growth generated the previous month.

In the first quarter of this year, the PPI rose by 3.7 percent year-on-year, 0.3 and 3.7 percentage points lower than the growth rate of the first two months of this year and the same period last year, respectively. In March, the PPI cost increased by 3.1 percent, 0.6 percentage points lower than the growth rate in February, and 0.2 percent lower than the growth generated the previous month. In the first three months this year, the purchasing price of PPI rose by 4.4 percent. In March alone, the figure went up by 3.7 percent year-on-year and was down 0.3 percent from one month ago.

9. The employment situation basically remains stable. 

The surveyed urban unemployment rate was 5.0 percent in January, 5.0 percent in February and 5.1 percent in March, 0.2 percentage points, 0.4 percentage points and 0.1 percentage points lower than the same period last year respectively. The surveyed urban unemployment rate in 31 big- and medium-sized cities was 4.9 percent in January, 4.8 percent in February and 4.9 percent in March, 0.1 percentage points, 0.2 percentage points and 0.1 percentage points lower than the same period last year respectively. 

By the end of the first quarter, the number of rural laborers, who work as migrant workers out of their hometowns, had reached 174.41 million, 1.88 million more than the same time last year, up 1.1 percent.  

10. Residents' income increases steadily.

In the first quarter, the national average per capita disposable income was 7, 815 yuan, which means a nominal growth of 8.8 percent year-on-year and an actual growth of 6.8 percent year-on-year after adjusting for inflation. Classified according to residents' permanent residence locations, over the first quarter, the urban residents' average per capita disposable income was 10,781 yuan, an actual growth of 5.7 percent after adjusting for inflation, and it was 4,226 yuan with a 6.8 percent growth rate for rural residents. The average per capita disposable income between urban and rural residents stood at 2.55:1. The income ratio was 2.57 the same period last year. The median of the national average per capita income is 6,580 yuan in the first quarter, nominally up 8.5 percent year-on-year.    

11. The effects of restructuring and upgrading are obvious.

Supply-side structural reform deepens. In the first quarter, the national industrial capacity utilization rate was 76.5 percent, 0.7 percentage points higher than the same period last year. Destocking has made concrete progress. By the end of March, the for-sale area of the commercial residential houses had dropped 16.7 percent year-on-year. The effects of the deleveraging efforts are apparent. By the end of February, the liability-asset ratio of industrial enterprises above designated size is 56.3 percent, down 0.8 percentage points year-on-year. The cost of the real economy continues to drop. The cost of per 100-yuan main business revenue of industrial enterprises above the designated size is 83.98 yuan in January and February, 0.33 yuan less than the same period last year. 

The investment in the deprived fields has increased fast. In the first quarter, the investment in ecological preservation and environmental treatment, public facilities and agriculture grew by 34.2 percent, 13.4 percent, 25.4 percent respectively year-on-year, 26.5, 5.9 and 17.9 percentage points faster respectively than the average growth of the total investment in all fields.    

The economic structure is continuously optimizing. In the first quarter, the contribution rate of the tertiary industry's added value to the growth of gross domestic product was 61.6 percent, 25.5 percentage points higher than that of the secondary industry. The contribution rate of the final consumption spending to economic growth was 77.8 percent, 46.5 percentage points higher than the contribution from gross capital formation. 

The new drivers of growth are developing fast. In the first quarter, the number of newly registered enterprises nationwide reached 1.323 million, up 5.4 percent year-on-year, which translates to 14,700 new enterprises per day on average. The added value of the emerging strategic industries increased 9.6 percent year-on-year, 2.8 percentage points faster than the average of the industrial enterprises above the designated size aforementioned. Green development advances. In the first quarter, the energy consumption per unit of gross domestic product dropped 3.2 percent year-on-year.

Generally speaking, the national economy continued its steady growth and structural optimizing in the first quarter. The favorable conditions supporting high quality growth increased, laying a good foundation for the healthy and steady development of the economy this year. But it is noteworthy that the uncertainties in the international environment increase, and the unbalanced and incomplete development at home remains outstanding, and the reform and development missions are still tough. 

In the next stage, we should follow the guidance of the Xi Jinping Thought of Socialism with Chinese Characteristics for the New Era, implement the spirit and requirements of the Communist Party of China's 19th National Congress and the Central Economic Work Conference, carry out the deployment of the Government Work Report, adhere to the principle to seek progress in stability, realize the new development concepts, deepen the supply-side structural reform, seek innovation-driven growth, further expand reform and opening-up, increase the internally generated driving forces for development, guide and stabilize people's expectations for future growth and push forward the sustainable and healthy development of the economy. 

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CCTV:

The statistics you just released show China's economic performance in the first quarter was stable. How do you understand the situation? You just mentioned that China had made a good start. Can you explain? 

Xing Zhihong:

Thank you for the question. In the first quarter, national economic performance remained stable while making further progress with new growth momentum emerging. We have made a good start, as the transformation and upgrading of industries went further, and the quality and effect of development continued to improve. Generally speaking, national economic performance in the first quarter was stable and sound, with new growth drivers emerging and economic structure improving. 

First, the national economy ran steadily. Major macro-regulation indexes show that in the first quarter, China's economic performance remained stable. A steady rise was seen in the economy, more jobs were created, commodity prices remained basically unchanged, and a general balance was kept in international payments. 

Regarding overall economic development, in the first quarter, the national economy grew 6.8 percent, at the same rate of the fourth quarter of last year. The rate has remained between 6.7 percent and 6.9 percent for 11 consecutive quarters.

Regarding the job market, the urban unemployment rate was around 5 percent in the first three months. In particular, the unemployment rate in 31 big cities remained below 5 percent. The total number of rural workers working outside their hometowns increased 1.88 million, up by 1.1 percent year-over-year. The sound employment situation is a major indicator of stable economic performance.

Regarding commodity prices, in the first quarter, the CPI increased slightly by 2.1 percent year-on-year. Commodities were in sufficient supply, basically able to meet the market demand. Moreover, the PPI growth rate slowed down. In the first quarter, the PPI increased 3.7 percent, with the growth rate down by 3.7 percentage points year-on-year.

Regarding international payments, so far this year, China's imports and exports continued to grow rapidly. In particular, the growth rate of imports continued to outpace exports, leading to a smaller trade surplus. Imports and exports were more balanced, and foreign exchange reserves were basically unchanged.

Second, the economy is driven by new growth drivers. It is mainly reflected by innovation-driven development. Mass entrepreneurship and innovation are booming and have stimulated market vitality and social creativity. New growth drivers continue to increase. Since the beginning of this year, new market players have increased substantially. Statistics by relevant authorities show that China's newly registered enterprises in the first quarter reached 1.32 million, with a daily increase of 14,700 on average. This substantial increment illustrates that mass entrepreneurship and innovation encourage passion for business. New industries, businesses and models are thriving. In the first quarter, the added value of the strategic emerging industries grew by 9.6 percent, registering an increase higher than the average growth rate of the industrial enterprises above designated size. Meanwhile, online retail sales rose 35.4 percent, and the volume of express delivery went up more than 30 percent. Their growth rate continues to accelerate. Now, the "Internet Plus" has reached different industries and sectors and bred many new forms of industries and business models. The digital economy, platform economy and sharing economy continue to grow rapidly, injecting new vitality into China's economic development.

Third, the economic structure has been optimized and coordinated development enhanced. In terms of industrial structure, the service industry continuously played a leading role as it accounted for 56.6 percent of the economy in the first quarter, 0.3 percentage points higher year-on-year. It contributed 61.6 percent to economic growth, 25.5 percentage points higher than that of the secondary industry. The industry continues to move toward mid and high-end manufacturing as the proportions of high-tech manufacturing and equipment manufacturing were improved to 12.7 percent and 32.2 percent respectively among industrial enterprises above designated size. 

In terms of demand structure, the fundamental role of consumption has been enhanced. The final consumption expenditure contributed 77.8 percent to economic growth, 46.5 percentage points higher than that of the gross capital formation. Consumption of goods has been shifted to quality consumption; material consumption shifted to service consumption. This is the new change in terms of consumption.

In terms of investment, the investment also addressed inadequacies, shored up points of weakness and gathered momentum, thus achieving an optimized structure. This year, the investment in agricultural and social sectors both grew by over 20 percent. As for industrial investment, investments in high-tech industries have increased continuously.

The foreign trade structure has also been optimized. In terms of trade modes, the proportion of general trade was improving. In terms of trade subjects, the proportion of exports of private enterprises increased continuously. In terms of region, the imports and exports in central and western China grew remarkably faster than that of the nation as a whole. 

Four, the economic performance is good. The efficiency of enterprises were improved, household income increased, and green development was boosted. Enterprise profits enjoyed rapid growth. From January to February, profits of industrial enterprises above designated size increased by 16.1 percent year-on-year, and profits of service companies above designated size rose by 4.5 percent. It is not easy for enterprises to maintain such a growth rate considering the high profits last year, which indicates their efficiency has been improved. People's income grew 6.6 percent in real terms, still faster than the growth of GDP per capita, which indicates that the growth of household income almost synchronized with the economic growth. Green development was advanced steadily. Energy consumption per 10,000 yuan of GDP fell by 3.2 percent, the share of clean energy consumption increased, and utilization efficiency of energy and resources was improved. Continued improvement in the environment, especially air quality, was achieved.

The conclusion is that stable performance and improvement in quality and efficiency have complemented and promoted each other. Stability, harmony, inclusiveness and sustainability of the economy have been strengthened, which will lay a solid foundation for the sustainable and healthy economic growth of this year. Thank you. 

Phoenix TV:

We are concerned about the situation regarding foreign trade. Although the figures have already been announced, we would still like to ask whether there are preliminary estimates from the National Bureau of Statistics. If the international environment continues to have uncertainties, especially any potential Sino-U.S. trade friction escalation, will it impact on foreign trade in the second quarter or even the second half of the year? And how big will the impact be do you think?

Xing Zhihong:

The issues of foreign trade are everyone's significant concern. Sino-U.S. trade is not only a problem between the two countries, but also an international issue. China has never deliberately pursued a trade surplus. In the past two years, China's trade surplus has been narrowing. The reason why foreign exports continues to grow is because China has comprehensive competitive advantages. At the same time, China's imports have also increased, reflecting the strong growth in domestic demand in China. In our foreign trade, we pursue a trade balance. This kind of balance is also conducive to the development of the domestic economy.

Regarding the issue of Sino-U.S. trade, the Chinese government has already demonstrated its firm stance. The pattern of our opening up to the outside world is further expanding. When one door shuts, another opens. Our trade space is still very large. We can continue to maintain a balance of import and export as the domestic enterprises continuously enhance their competitiveness. Thank you.

China Radio International: 

Statistical indexes of export, investment and industry have gone down. Does this mean growth potential will slow down, while pressure on growth will increase? 

Xing Zhihong:

I have introduced the statistics from the first quarter to you. The operation of the economy is stable. The "slowdown" was probably caused by some indexes' fluctuation in March, which was mainly caused by factors related to the Spring Festival. It is the most important traditional festival in China. Although the statutory holiday is seven days, its influence lasts much longer than that. The Spring Festival fell in the second half of February this year, which was later than usual. March 2 was the Lantern Festival. So the festival's late arrival had obvious influence on production. In our research and investigation, some export enterprises said they would try their best to export before the festival, and increase imports first after the festival with export gradually speeding up. The trade statistics in March showed clear Spring Festival influence. Also, the number of working days in March this year was one day fewer than last year. The two factors overlapped, causing some of the indexes' fluctuations in March. But beyond seasonal factors, we've found that the trend characteristics of the market and the increase of production have remained unchanged. 

As for China's economic development trend in the next stage, it is fair to say that the favorable conditions and factors supporting high quality growth are increasing. China's economy will continue to keep a development trend that features stabilizing growth. As for the supply side, the real economy's vitality is increasing, the quality and efficiency of the supply-side system are improving and the foundation for future growth is becoming more solid. 

The situation of agricultural production is comparatively good, with the implementation of a rural rejuvenation strategy and the deepening of agricultural supply-side structural reform. The improvement of agricultural products and the rise of green agriculture have prompted the adjustment of the crop-husbandry structure, further enhancing the comprehensive benefits and competency of agriculture. The growth trend of industry is stable. The industry grew at 6.8 percent in the first quarter, up 0.6 percentage points from the fourth quarter last year. Among the 41 major industries, 37 (90 percent) saw growth, better than the last year. The industrial capacity utilization rate has increased. The advanced manufacturing industry plays an increasingly important role as a driver for the growth of the whole industry. The service industry has maintained stable and comparatively fast development momentum. The production index of the service sectors remained above 8 percent in the first quarter, reaching 8.3 percent in March, 0.3 percentage points higher than January and February and the highest over the past six months. The emerging service sectors, with the internet as a representative, have grown robustly. The development of service industries, especially those related to people's livelihoods, has sped up.

On the demand side, consumption's foundation role is strengthening. And investment's key role in promoting the optimization of supply-side structure has become increasingly outstanding. Currently, foreign and domestic demands both exert powers, pushing supply-demand relations to develop in the direction of dynamic balance and positive cycle.

On the consumption side, the momentum of final consumption's growth is stable. The upgrading of residents' consumption structure has accelerated. The growth momentum of the upgrade-type of commodities is stable. The merging of online and offline consumptions has been expedited. Not only was online retail growing fast, but also traditional commerce, for instance, department stores', supermarkets' and exclusive shop's growth in the first quarter was faster than the same period of last year, reflecting retail's new positive influence in all consumption fields. 

The consumption in the service industry is growing robustly. The box revenue grew 39.8 percent in the first quarter. The investment structure is optimizing. The most important change is that civil investment is showing stronger vitality, accounting for more than 60 percent of the total investment. The civil investment grew by 8.9 percent in the first quarter, 2.9 percentage points higher than last year. Meanwhile, the fields of civil investment have expanded further, with some key fields strengthened, which has cast positive influence on supply-side structural optimization and the enhancement of supply-side efficiency.

As for projections, the deepening of reform and opening-up, the growth of driving force generated from innovation and the release of the bonus of a series of policies will consolidate the market players' anticipation and confidence in the future. The growth of the purchasing manager index (PMI) of the manufacturing sped up in March and had expanded for 20 months consecutively. Particularly, the PMI of large-, medium- and small-sized manufacturing enterprises all expanded in March. The non-manufacturing commercial activity index has remained at 54 percent, a positive sign, for seven months continuously. The consumer confidence index reached 122.3, a comparatively high level given its history. So judging from the three aspects of supply, demand and projection, internally generated driving force is becoming stronger. This is the most important support for the sustainable and healthy development of the Chinese economy. Thank you.

Die Welt:

You just answered one question about the problems between China and the United States with the impact of trade, but how bad are you evaluating the whole impact on the Chinese economy if the frictions are going to develop to a sort of a trade war. Thank you. 

Xing Zhihong: 

The United States disregarded the rules of international trade and clung obstinately to its own course of provoking trade frictions. The international community has been worried about this classic act of trade protectionism and unilateralism and China strongly opposes such acts. Our government has responded firmly and fiercely. People are concerned about the effect on China's economy if the frictions continue. I want to say that in recent years, China's economy has seen increasingly sustained, steady, and coordinated growth, and it has strong resilience, potential and leeway. China-U.S. trade frictions won't change the positive trend of sustained and sound economic development in China.

First, China's economy is resilient and adaptable. In recent years, the supply-side structural reform and innovation have stimulated China's internal driving force and vitality for economic growth. More importantly, major changes in the structure of economy have been brought about. Since the Party's 18th National Congress, economic growth has moved out of the developmental stage of being mainly propelled by the industrial sector into the stage of being propelled by the industrial and service sectors together, out of the stage of being mainly propelled by investment into the stage of being propelled by investment and consumption together. And China has transformed from a large export country into a country placing equal stress on export and import. These structural changes have enhanced the stability and resilience of China's economy. 

Over the past few years, the global economy has undergone profound adjustments, and the external environment remains relatively complicated, but China's economy has maintained a growth at a medium-high speed, largely thanks to our economic structure that mainly relies on domestic demand. According to the statistics department, the annual contribution rate of domestic demand to China's economic growth between 2008 and 2017 reached 105.7 percent, a figure more than 100 percent. That is to say, we have been able to hedge the impact of external demand with domestic demand. Especially in 2009 when the international financial crisis hit China hardest, the contribution of domestic demand to China's economic growth exceeded 140 percent. 

Last year, the global economy showed an overall recovery, and it was the same case with the external demand. Even under these circumstances, the contribution of domestic demand to China's economic growth remained at 90.9 percent, so this structure is very critical for us to deal with external shocks. Of the domestic demand, final consumer spending is the primary driving force and the biggest engine. I mentioned just now that the contribution rate of final consumer spending, which was 58.8 percent last year, was 77.8 percent in the first quarter this year. The final consumer spending has been the primary engine of China's economic growth for five years in a row. Compared with exports and investment, the volatility of consumption is significantly smaller, and therefore, an economic structural change like this is crucial to the stability of China's economy.

Second, China's economic development has great potential. In an innovation-driven development strategy, development is the top priority, human resources are the primary resources, and innovation is the main driving force. 

The widespread entrepreneurship and innovation campaign has greatly bolstered the public's enthusiasm. Presently, more than 10,000 new businesses are established every day. Last year, annual R&D investments accounted for 2.12 percent of the national GDP, higher than the average level of 15 EU countries. Now, China's R&D investment is the second highest in the world. According to a ranking of international organizations, China's innovation index last year ranked 22nd in the world, which means China is leading all middle-income countries in terms of R&D investment. 

Because of its entrepreneurship and innovation campaign, China has shifted its reliance on demographic dividends to talent dividends. More than 170 million Chinese people have received higher education and possess specialized skills. They have great potential. This is where China's future lies. 

With technological innovation playing an increasingly significant role in promoting development, China's economy has maintained a relatively fast growth rate. Over the past years, China's economic growth rate has remained one of the fastest among major world economies. Last year, China's technological improvements contributed to 57.5 percent of national economic growth and 30 percent of world economic growth. 

China's economy has great vigor, dynamic and potential. These factors have greatly enhanced the innovative and competitive capacity of the Chinese economy, making us more capable of dealing with complex situations.

Third, we have ample room to maneuver. China is a big country. We have ample room to maneuver in terms of development, industrial systems and macro regulation. 

Regarding development, because of its large territory, China sees different development stages in different regions. Therefore, we are working to accelerate the urbanization drive, to promote coordinated development of the eastern, central, western and northeastern parts, and to foster synergy between the Three Initiatives (the Belt and Road Initiative, the coordinated development of the Beijing-Tianjin-Hebei region, and the development of the Yangtze River Economic Belt), thus to accelerate the balanced development of different regions. The potential of different regions has been further tapped, resulting in new development areas and new development platforms.

Regarding industrial systems, links to all industries can be found in China. This makes us capable of establishing a complete system of industries, promoting the application of scientific and technological advances, and fending off various risks. In this situation, even if some industries are affected, other industries can maintain growth momentum, offset the affected sectors' influence on other industries and on the larger economy, and support and promote the development of the affected sectors. This is a special characteristic of the Chinese economy.

Regarding macro regulation, we also have ample room to maneuver. Presently, China's economy has maintained steady performance; the financial and fiscal systems are running steadily; the foreign exchange reserve is the biggest in the world. As a result, we have plenty of policy tools to use, and they can be used on many occasions. 

To sum up, China is fully capable of handling trade conflicts with the United States, responding to various risks and challenges, and maintaining healthy development of its national economy. Thank you. 

CGTN:

The service industry producer index has maintained fast growth in the first quarter. And the contribution of the service industry to economic growth is bigger than that of secondary industry. What are your thoughts on the future development of the service industry? Thank you.

Xing Zhihong:

In 2012, the service industry in China surpassed the secondary industry, becoming the largest industry in China's economy. It has contributed greatly to economic development, serving as the main driving engine. Last year, the service industry accounted for 51.6 percent of China's GDP, contributing 58.8 percent to growth. And in the first quarter of 2018, it has maintained a fast growth rate, with proportion and contribution both increasing. China has entered a new phase of economic development driven by the service industry, representing the great progress China has achieved in economic transformation and upgrading. It reflects both the law of economics as well as profound adjustments to policy. The fast growth of the service industry in China is due to the following factors: 

First, the upgrading of the consumption structure provides a wider market for the development of the service industry. In accordance with international development experience and economic theory, the growth of the service industry is closely related to residents' income. Currently, China's per capita GDP in last year has reached nearly US$9,000, becoming one of the upper-middle income economies. With the growth of income, people's need for services has made an increasing impact. One of the obvious features of consumption in China is that, in addition to material goods, more and more people are spending money on services such as tourism, culture, education and health care, which injects fresh stimulus and driving force to the development of the service industry.

Second, the division of labor is deepening. The reconstruction of the supply chain, value chain and industrial chain has accelerated China's economic transformation from an industry economy to a service economy. China has now entered the middle and later stages of industrialization, heading toward the mid- and high-end markets. And during the upgrade of the value chain, the manufacturing industry itself creates much need for services with regard to research, design, marketing, management and logistics. It can also be noted from the statistics that technology, business and logistics services have produced new growth highlights.

Third, our efforts to deepen reform and opening-up have further unleashed the growth potential of the service sector. We have been continually expanding market access to the service sector. General Secretary Xi Jinping pledged in his speech at this year's Boao Forum for Asia that China would continue to increase openness, and the service sector is a focus of this endeavor. In fact, we have already set the openness of the service sector as a priority in developing pilot free trade zones. For example, we are easing the cap on foreign ownership in financial services, and the increasing foreign investment and investment from non-government sources in education and health care have given new impetus to the service sector. Additionally, private investment is booming, with a good deal flowing into the social domain.

Four, innovation has boosted the internal forces driving the development of the service sector. New forms and models of business created by the wide application of information technology have made the most salient impact on the service sector. E-health, online sharing and online education services have risen to prominence. Those new forms and models of business have played an important role in maintaining the rapid growth momentum of the service sector. Thank you.

Xi Yanchun:

Due to the time limit, please offer the last question.

Reuters:

You've just mentioned that China's average per capita disposable income grew 6.6 percent in real terms in the first quarter of 2018, lower than the growth rate of 7.3 percent in 2017. Do you think this trend will continue? What's the reason behind it? China's economy performed well in the first quarter. In your opinion, what is the top risk faced by China's economy in realizing steady, sound and high-speed development?

Xing Zhihong:

Let me talk about income first. The nominal growth rate of national resident income in the first quarter of 2018 was 8.8 percent, 0.3 percentage points higher year on year. The growth rates of nominal income for both urban and rural residents are higher than those of the same period in 2017. It shows that people's money bags are fuller this year. Why was there a slowdown in actual growth rate? It is mainly influenced by the factor of prices. In the first quarter of last year, the growth rate of commodity prices was relatively low. Actually, it is not that high this year. It is just 2.1 percent, indeed a mild increase. But compared with that of last year, it's higher and exerts some influence on actual growth of resident income. We can see that the Chinese economy is developing in a steady and sound way and more job opportunities are being created. Mass entrepreneurship and innovation are making progress and the income distribution system is improving. At the same time, our country has placed great emphasis on the growth of resident income and a series of policies have begun to take positive effect. All these will help increase resident income in step with economic growth. The actual growth rate of resident income in the first quarter was 6.6 percent, higher than that of per capita GDP. 

Specifically, the performances of enterprises have continued to improve and their operation is in good condition, which provides strong support for the growth of employees' wages. From the rural perspective, the structural reform of the agricultural supply side, the integrated development of the rural primary, secondary and tertiary industries, and the increase in the output and prices of some agricultural products in particular, have created favorable conditions for the growth of agriculture-related incomes. The land reform in rural areas is still ongoing. Farmers have gained property incomes and expanded their income sources through the transfer of the contractual right of land. Thus, the farmers' income grew faster than that of the urban residents. In the first quarter of this year, the increase of farmers' income continued to be higher than that of urban residents, and the income gap between urban and rural residents was further narrowed, which is a good change. Chinese governments at all levels have implemented the guideline of being people-centered and made more investments in people's livelihood. The social security standards have been continuously improved and the security coverage has been further expanded. Both urban and rural residents have gained more transfer incomes. Therefore, the income of citizens across the nation will continue to keep pace with the economic growth. Particularly, the goal to develop a well-off society with doubled incomes can be realized without any problem from the current point of view.

Currently, the biggest challenges facing China's economic development come down to the uncertainties of the international environment and the problems caused by unbalanced and inadequate domestic development. Rising protectionism, the adverse spillovers of major economies' changing monetary policies, and the fluctuation of the financial market may all have an impact on China's economy. 

For all the challenges, China's economy, with its strength, strong resilience, great potential and ample leeway, will continue to maintain stable performance with good momentum for growth.

Xi Yanchun:

Thank you, Mr. Xing.

Mr. Xing has no other things than a pen and a piece of paper in hand today, as he is thoroughly familiar with the statistics. And he has made a detailed and in-depth interpretation of those statistics for us.

We appreciate your continued attention on China's economic performance, and please contact the information office of the National Bureau of Statistics if you have other questions.

Thank you, Mr. Xing, and all our friends from the press. That's all for today's press conference.

Read in Chinese

Speakers:

Zhu Guangyao, vice minister of Finance

Wang Shouwen, vice minister of Commerce

Chairperson:

Hu Kaihong, spokesperson of the State Council Information Office of China

Date:

April 4, 2018

Hu Kaihong:

Ladies and gentlemen, good afternoon. Welcome to this press conference. The issues related to Sino-U.S. trade have captured great public attention recently. Today, we invite Mr. Zhu Guangyao, vice minister of Finance, and Mr. Wang Shouwen, vice minister of Commerce and deputy China international trade representative, to introduce relevant issues, and answer some of your questions.

Zhu Guangyao:

Good afternoon, everyone. Please allow me to brief you on the latest developments first. On April 4, the U.S. announced a proposed list of products subject to additional tariffs. It covers 1,333 Chinese export items, which are worth US$50 billion. The additional tariff rate is 25 percent. At 3:30 p.m. today, upon the approval of the State Council, the Customs Tariff Commission of the State Council unveiled a list of U.S. imports that will be subject to higher tariffs. It was decided that an additional tariff of 25 percent will be imposed on 106 items of products under 14 categories, including soy beans, automobiles and chemical products. 

Hu Kaihong:

Now the floor is open to questions. Please identify your media outlet before raising any questions.

The Wall Street Journal:

Superficially, the trade conflict between China and the United States now seems to be escalating. We would like to know if the two countries are still keeping up any communication and dialogue. What do you think is the possibility that the two sides will reach an agreement to avoid further escalation of the trade conflict? One more question: With the escalation of the trade conflict, the market is very concerned about whether China will retaliate against the United States by reducing U.S. treasuries or devaluing the RMB exchange rate. How would you respond to this issue, Mr. Zhu?

Zhu Guangyao:

Thank you for your questions. First of all, China has always stressed that China-U.S. economic relations are based on the mutually beneficial win-win principle, which is the essence of China-U.S. economic relations.

At the beginning of the establishment of diplomatic relations in 1979, the trade volume between China and the United States was only US$2.5 billion. That number hit US$580 billion in 2017, an increase of more than 232 times. Such rapid development reflects the essence of China-U.S. economic relations, that is, mutual benefit or win-win. It is the common aspiration of the peoples of China and the United States and it has brought advantages to the peoples of the two countries.

Such rapidly growing economic ties and such a large volume of trade inevitably result in trade frictions. Regarding trade frictions, we have always reiterated the principle of mutual respect and encouraged resolution through policy negotiations as well as the rules of the WTO, which is the principle that China and the U.S. should abide by as key members of the treaty. With this as the premise, our cooperation and constructive methods have successfully addressed many trade frictions in the past. Frankly speaking, the challenges facing us today are truly daunting, because we have seen such a large volume involved. Yet, China's position is very clear. We don't want a trade war, because it is doomed to produce a lose-lose outcome that will hurt both China's and the U.S.' interests, and also undermine the prospect of the world economy. In this crucial moment, we hope China and the U.S. can take a constructive, wise and mutually respectful approach to the issue and challenges, thus putting the Sino-U.S. economic relationship back on the right track. 

As for the second question, if the conflict continues to escalate, you journalists can review Chinese history since the founding of People's Republic of China in 1949, and you will find that China never succumbs to any external pressure and the pressure will only make the Chinese people become more perseverant and focused on our own economic development. It can be a kind of impetus to promote innovation and progress. 

However, we certainly hope that both sides can start from a foundation of bilateral interests and resolve problems and challenges in a constructive way, rather than treating China-U.S. economic ties, which is of vital importance to the interests of both people, in such a random and reckless way. 

Your third question concerns the issue of U.S. government bonds. I know that this issue is a concern of the international community, and the international capital market is now paying close attention to it. Here I would like to remind the reporter with the Wall Street Journal that Chinese Premier Li Keqiang expounded on this issue at the press conference held after this year's National People's Congress session concluded. Premier Li Keqiang emphasized that China makes diversified investments of its foreign exchange reserves on the basis of market principles, and China will remain a responsible long-term investor. This is the solemn announcement made by Premier Li Keqiang at the press conference following China's "two sessions."

To understand Premier Li Keqiang's expression — "a responsible investor," I would like to share with you a basic principle of the operation of China's foreign exchange reserves. First, China does have more than US$3 trillion of foreign exchange reserves, which is the assets of the people. The primary principle of the operation of China's foreign exchange reserves is security, which means to ensure the safety of our investments. The second is liquidity, and the third is modest profitability. China has operated its foreign exchange reserves in accordance with these principles over the years to secure people's property, if we see it from a domestic perspective. As for the international perspective, China is a responsible investor in the international capital market, which is shown in our respect for the rules of operation of the international capital market. We have carried out precise operations under this principle as well. I think this expression of Premier Li Keqiang is a very clear and authoritative answer to the question of the Wall Street Journal today. Thank you. 

China National Radio (CNR):

I noticed that Minister Zhu sill used the term "friction" to describe the current trade problem between China and the United States. But we know that China announced to impose tariffs on US$3 billion worth of US imports on April 2, and the Office of the U.S. Trade Representative (USTR) announced tariffs on about US$50 billion worth of Chinese goods on April 3 (EST), leading China to then unveil a list of products worth about US$50 billion imported from the U.S. that will be subject to higher tariffs today. With all those measures on both sides, does it mean that a trade war has already started between the two countries? Is it still possible to solve the problem through negotiation? Are the channels for negotiation still open? What measures do you think will be taken by both sides?

Wang Shouwen:

You have followed the trade frictions between China and the United States in great detail. Thank you for your interests in the trade issues between China and the U.S. On April 2, China announced tariffs of 15 and 25 percent on 128 items of U.S. products. This was in response to the move by the U.S. to impose import restrictions on Chinese steel and aluminum products. The measures taken by the U.S. under Section 232, citing national security concerns, are untenable and unfounded. Moreover, the restrictive measures target only a few countries while many other countries are excluded. It can be seen, therefore, that the U.S. move is not based on security  concerns and is discriminatory. This is a flagrant violation of the multilateral trading system and hurts China's interests, so China has already filed a request for consultations on the Section 232 investigation at the WTO. Meanwhile, in order to safeguard our legitimate interests, we also adopted the US$3 billion worth of countermeasures that you just mentioned on April 2. We have noticed that, in response to the Section 232 measures, the EU and other members of the WTO are also considering taking measures.

The United States announced on April 3 a proposed list of products imported from China worth US$50 billion that will be subject to additional tariffs under Section 301. We believe the move fundamentally violates the international obligations of the United States and has no factual basis at all. The move has impaired China's interests, threatened China's economic security and jeopardized the recovery and stability of the global economy. Therefore, according to international law and the Article Seven of the foreign trade law of China, if any country or region adopts discriminatory measures or other similar measures to ban or limit China in trade, we must respond with corresponding measures. So, as just mentioned by Mr. Zhu, we released our list worth nearly US$50 billion. I have to say, we refrained but were forced to make such a move. 

You also mentioned the question of a trade war. China has no intention for a "trade war," because there is no winner in a "trade war." However, we are not afraid of it. If there is someone who insists on a "trade war, " we will fight to the end. You asked if there was a channel for dialogue and communication. Our stance has always been that the door is open for resolving the problems through negotiation, dialogue and communication. If the U.S. side has the intention to hold talks, we will certainly agree to negotiate and resolve the differences on the basis of equal negotiation and mutual respect. To make it simple, if somebody wants to have a "trade war," we will not retreat, if they want to talk, the door is always open. Thank you.

CNN:

While publishing the list, the U.S. said it would minimize its influence on domestic enterprises and citizens. What are China's considerations on its list? As you said, among the more than 100 products of 14 categories, the first two are soybeans from the United States. These agricultural products are very important to the big agricultural states in the Midwest. These states are core supporters of Donald Trump in his presidential election. So my question is whether China intended to shake President Trump's political base and initiate a precise strike to force him not to start a "trade war," or to come back to the negotiation table?

Zhu Guangyao:

The CNN reporter analyses challenges in the Sino-U.S. economic relations from the angle of politics. I think business is business, and we should analyze the challenges and how to respond to them from the economic perspective. Because, as China has reiterated, the essence of Sino-U.S. ties is mutual benefit and win-win results. And Sino-U.S. economic ties are the ballast and propeller for Sino-U.S. relations. President Xi Jinping has devoted tremendous energy to maintain the healthy and stable development of China-U.S. economic relations. It is under this precondition that we have lodged serious representations to the United States, reminding it that if it uses the so-called Section 301 and national interests as an excuse to solve economic issues, it will harm its national interests, China's interests, as well as the whole world's interests. Under these circumstances, we are compelled to take the countermeasures, publishing the product list, and its content and order are all well grounded. 

Frankly speaking, China accounts for 62 percent of U.S. soybean exports. We all know that the U.S. soybean farmers hope China and the United States have sound economic ties, because they can benefit from the healthy development of the relations. The United States exported 32.854 million tons of soybeans to China last year, 34.39 percent of China's soybean imports. This size of imports is too big. Some Chinese soybean farmers have appealed to the relevant associations, saying that the U.S. government's subsidies have affected their interests. The Chinese government respects the farmers' requirements, and the policy appeals of the Chinese Soybean Association. Thus, soybean has become part of our countermeasures. But this goods list has not yet taken effect. The two sides have laid the problems open on the table. It is time for negotiation and cooperation. The precondition for negotiation and cooperation is mutual respect. No one side should enforce conditions on the other side at its will. 

We don't think that reckless and wild actions can resolve problems, and divergences can only be resolved through constructive talks and pragmatic negotiations. The preconditions for negotiation are mutual understanding and mutual accommodation, not pricing oneself out of the market. China has long-term friendly exchanges with the United States in this regard. Frankly speaking, I have engaged in works related to the United States for many years. I have had many quarrels with my U.S. colleagues. But we all know the national interests of our respective countries, and we will finally come back to the negotiation table. In accordance with the consensus reached in the two leaders' meeting in Mar-a-Lago, Hamburg and Beijing, we should resolve the trade disputes through pragmatic and constructive attitudes, and consolidate the mutual beneficial and win-win economic ties between the two countries to benefit our two peoples, including the soybean farmers in both countries. I appreciate that the U.S. soybean farmers and the American Soybean Association, for I know that they are pressing President Trump and the U.S. government to maintain the hard-won economic ties with China through various means, including paying out of their own pockets to air their voices in the U.S. media. Of course, they have benefited tremendously from the sound Sino-U.S. economic ties. Thanks.

CCTV/CGTN:

My question is, as President Trump said he hopes that China will reduce its annual trade surplus with the United States by US$100 billion. What's China's attitude on this issue?

Wang Shouwen:

Thank you for your question. First of all, we must understand how the trade surplus was formed. Trade happens between companies and consumers from two countries on a voluntary basis. Sometimes, a country wants to buy, and another country wants to sell. It is not decided by the governments, but by the economic structure and industrial competitiveness of the two countries.

Why does trade between China and the United States appear to be imbalanced? In my opinion, first of all, it is a problem with the structure of the U.S. economy. The U.S. economy is driven by over-consumption and under-saving. Its savings are less than its investments. This determines that it must have a deficit in global trade. The United States has a trade deficit not only with China but also with many other countries. Secondly, in order to maintain the status of the U.S. dollar as an international payment currency, the United States must maintain a relatively large trade deficit.

Third, an important cause of the Sino-U.S. trade imbalance is that although the United States has many advantageous industries, the U.S. government imposes many restrictions on U.S. companies, forbidding them to sell products to China. Therefore, the U.S. exports to China were affected, and the trade deficit emerged. The U.S. high-tech industry is a typical example. And there are many other U.S. industries that are highly competitive, but are not allowed to export to China. When those that can sell goods in China are not permitted to do so, it's natural that U.S. exports to China are low, and that the United States is seeing a trade deficit.

We are delighted to see that after President Trump took office, the restrictions on energy products, crude oil, liquefied natural gas and some other goods were loosened. Previously, these products were totally forbidden to be sold to China. In response, we increased the import of U.S. oil and gas substantially. These are positive measures, and can help solve the problem.

Now, let's look at the specific figures. If we take a closer look at the surplus and deficit figures, we will find the gap is not very large in actuality. Taking into account statistical variations, and the impacts of entrepot trade and service trade, China's trade surplus is only one third of the trade deficit announced by Washington. In the United States, the current account deficit was 4.9 percent of GDP during the financial crisis in 2007. Now, the figure is 2.3 percent. This means the proportion is declining. In China, the current account surplus was 9.9 percent of GDP in 2007, and the figure dropped to less than 2 percent today. Therefore, China and the United States both achieved progress in maintaining trade balance. This is a result that we are all glad to see.

You mentioned that China should reduce the US$100 billion surplus, which is absolutely unacceptable. The first reason is that we are unable to do it. As I analyzed just now, the trade surplus and deficit is determined by market forces as well as the overall economic policies and structure of the U.S., so China cannot reduce the surplus on its own. 

Second, we cannot accept it, because it requires efforts of both sides to reduce the surplus, and no one can reduce the surplus on its own. China wants to buy U.S. products, but the U.S. does not sell and even continues to restrict its exports, then how can the surplus be reduced? Therefore, we hope that the U.S. can relax its export controls of high-tech products to China, increase its domestic saving rate, and actively respond to the measures taken by the Chinese government to expand our import. For example, China will hold the China International Import Expo in Shanghai from November 5 to 10 this year, and we hope that U.S. industries and businesses can take this opportunity to display their products and services to Chinese consumers and importers. We believe that only through the joint efforts of both sides can the trade surplus or deficit be eased gradually. It is not feasible in both theory and practice to set a number and work for it through government intervention. Thank you.

NPR:

In the investigation report of Section 301 made by the United States Trade Representative, the "Made in China 2025" program seemed to be riddled with criticism. It put forward the following concerns: First, how can China acquire advanced technologies? Is it through appropriate channels? Second, "Made in China 2025" clarified that Chinese enterprises will account for a certain market share. Will excludability exist? Finally, does the fact that domestic enterprises receive a lot of funding from the government conform to international economic rules? What are your comments on these points? Will "Made in China 2025" adjust itself to conform to international economic rules more strictly?

Wang Shouwen:

Thank you for your question. You speak better Mandarin than I do. As for "Made in China 2025," China proposed it on the basis of open development and win-win cooperation. You have a clear understanding of it, as the initiative itself is open and transparent. It aims to offer some strategic guidance and information for the upgrading of Chinese manufacturing sector. It is transparent, open and does not discriminate. Both Chinese and foreign enterprises, state-owned and private ones, can all take part in it. So we welcome U.S.-funded enterprises to join it, too. In its roll out process, we made stringent examinations to guarantee that it conforms to WTO rules. The Ministry of Commerce fulfilled the duty on the basis of our commitment to the WTO to ensure that we perform our duties as a WTO member. So we maintain that "Made in China 2025" meets the obligations of the WTO framework.

If you think that "Made in China 2025" is inconsistent with WTO obligations and goes against China's commitment in any respect, we can come together to negotiate with the WTO, or we can further bring a lawsuit. But we don't want anyone to artificially create excuses and then unilaterally take steps. Perhaps we have different opinions, but we hope to solve problems in the framework of WTO international rules.

"Made in China 2025" does have some targets, and these goals are predictive, directive and not mandatory. In fact, many countries have also made similar guidance targets and guidance plans. If you don't agree with me, I look forward to receiving your comments and criticism.

The Clinton administration developed a national infrastructure plan which took the information superhighway as an important approach to revitalizing the U.S. economy. We believe that our "Made in China 2025" is similar to that. The Obama administration also launched a national plan aimed at doubling the U.S. exports in five years. That was a guidance plan, too. The European Union also made its "industrial revival" program.

So, I suggest you read the "Made in China 2025" carefully again and don't take it as a terrible thing. I would like to emphasize that it is transparent, open and non-discriminatory. Some of the targets it sets are guiding and leading ones, which only provide some guidance information rather than mandatory tasks. And this practice has been adopted by many countries, including the United States.

Zhu Guangyao:

Shouwen's response to this journalist's question is put in a historical and global perspective and is very objective. The USTR criticised "Made in China 2025," accusing China of infringing on or stealing U.S. intellectual property rights, and saying that is why China boasts such rapid growth. 

Indeed, China's per capita GNP was US$220 in 1980, and the figure surpassed US$8,820 in 2017, according to the latest statistics. This is a tremendous change. How has the unprecedented rise in China's comprehensive strength come about? I think, the underlying reason lies in reform and opening-up under the leadership of the Communist Party of China. President Xi Jinping stressed that reform and opening-up plays the decisive role in determining the destiny of contemporary China.  

As for intellectual property rights, how has China realized such fast growth? We have our recipe for success. We prioritize development, regard talent as the top resource and  see innovation as the most powerful driving force. We adopt the new concept of innovative, coordinated, green and open development that is for everyone to realize sustained growth of the national economy and continuous improvement of people's lives. At the same time, we follow the principle of mutual respect, fairness and justice, cooperation and win-win results to positively handle international relations, in which the Sino-U.S. economic relationship comes to the fore. 

At this critical moment for China-U.S. economic ties, I think the two sides should calm down and engage in consultation based on facts and in the spirit of mutual understanding and mutual respect. The at-fault party should examine its mistakes. The two countries should not criticize each other. We should not consider that the other country is developing at the expense of our own development. In a pluralistic world, the cooperation between China and the United States is crucial to world peace and development as well as the interests of the two peoples. Therefore, it is the expectation of all people around the world, not just the people of our two countries, that we can properly manage the trade friction between us. A reporter asked a question about "trade friction" and "trade war" just now. I think the two countries are putting forward requirements for each other. Based on the requirements, we'll properly settle relevant disputes through consultation on an equal footing. We'll also pay attention to the protection of intellectual property rights, which is a top priority for making China a country of innovators. Thank you.

CCTV:

In the face of such an immense trade challenge from the United States, will China have the ability to deal with it? If this continues and evolves into a trade war, will China be able to afford it, and win it?

Zhu Guangyao:

Your questions are on how to face and deal with the challenges. Regarding relations between China and the world, especially economic relations, President Xi Jinping made a very clear statement in the report at the 19th National Congress of the Communist Party of China (CPC). President Xi emphasized that China will never pursue development at the expense of others' interests, but nor will China ever give up its legitimate rights and interests. No one should expect China to swallow anything that undermines its interests. President Xi's words are a guideline for us to handle China-U.S. trade disputes and even severe trade frictions. We deal with this relationship according to President Xi's instructions. We have repeatedly communicated with them, but the U.S. side is still obstinately walking on its own path alone and has introduced a high-tariff list of items worth US$50 billion. We must act in defense of China's own interests. 

Under the circumstance that both sides have laid out their conditions, we hope that both sides can treat each other candidly and with mutual respect and conduct consultations based on the principle of cooperation and win-win. As I just said, China has never given in to external pressure since the founding of the People's Republic of China. This is the history of the development of our country and the history of the Chinese people's struggle. China will not yield to any external pressure. On the contrary, under the guidance of the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, through innovation and development, the Chinese economy will rise to a higher level, China's per capita GNP will continue increasing from the current US$8,820, and China's market will become broader and more attractive. We open up to the whole world and hope that every foreign investor can benefit from China. As we all know, State Councilor and Foreign Minister Wang Yi has already announced that President Xi Jinping will attend the Boao Forum for Asia and deliver an important speech on China's reform and opening up policy. Under President Xi's leadership, China will embark on a broader and more ambitious road that will not only benefit the Chinese people but also make our contribution to the peace and development of the world.

Phoenix TV:

Some media outlets have recently said that the current "trade war" between China and the U.S. was incited by China, because China undertook actions like forced technology transfer, which threatens the protection of intellectual property rights. How would you comment on this? 

Wang Shouwen:

Thank you for your question, Phoenix TV. I think it would be appropriate to respond to the media report you quoted with what President Trump gets used to say, that it's "fake news".

The U.S. investigated this so-called matter of "China's theft of intellectual property rights" and proposed a specific tax list yesterday based on its domestic law. First, the U.S. violates its own commitments. When the U.S. passed the WTO Agreement in 1994, the President submitted a Statement of Administrative Action to the Congress, and the U.S. promised not to decide whether other countries' practices are against the WTO rules or not unilaterally through the Section 301 Investigation. So the U.S. must handle disputes related to the WTO according to the WTO rules and the final decisions of dispute settlement bodies. Without the WTO's mandate, the U.S. government has no right to terminate its obligations under the WTO, nor can it conduct cross sector retaliation. The U.S. violated its own commitments first. Then, in 1998, the E.U. sued the U.S. for its Section 301 Investigation into the WTO. The case was called DS152. The U.S. made another international commitment to the process of the litigation, saying that it would handle relevant trade disputes in strict accordance with WTO dispute settlement procedures, rather than adopting the Section 301 Investigation and its conclusions unilaterally. Therefore, the U.S. has violated its commitments to its domestic law and international law, so who would you say has incited this "war"?

Second, the U.S. accused China of its "forced technology transfer" in the Section 301 Investigation, which was completely baseless because China has no law stating that foreign companies must transfer their technology to their Chinese partners. There is no law making such requirements either. There are certain industries in China where joint ventures are required for foreign investment, which is in line with WTO rules. As a developing country, China hopes that foreign investment and Chinese companies can make joint ventures, which is completely in line with WTO rules as well. So in this circumstance, it is baseless for the U.S. to say that the Chinese government has forced technology transfer. Technology transfer between companies is completely based on contracts. One company is willing to transfer, and another is willing to accept and pay an appropriate amount, which is a voluntary action that the government should not intervene in. In fact, some U.S. companies have realized huge gains in China by means of joint ventures. For example, a well-known American automobile company established a joint venture in China, and now the automobile production of the company in China is more than its automobile production in any other place in the world, including the U.S. The profits the joint venture obtained exceed those obtained in the U.S. or any other country in the world. These are the benefits of joint ventures, which benefit both China and the U.S. How could such practices be regarded as forced technology transfer?

Third, China is committed to the protection of intellectual property. General Secretary Xi put forward a new development philosophy in his report delivered at the 19th CPC National Congress. The first principle of which is development driven by innovation. Without the protection of intellectual property, there is no space for innovation-driven development. We have improved the IP protection system through legislation and established a series of mechanisms for administrative enforcement and judiciary. We have set up trans-provincial IP courts. An American transnational corporation told me that one of its companies in China won 28 out of 31 cases here. You can search for the judgments of IP disputes. More than 80 percent of lawsuits filed by American clients were ruled in their favor. This shows that China's court system and administrative enforcement provide strong protection for IP rights.

China is a developing country. We are not perfect regarding IP protection. But we must admit the progress has been made in this regard. When China entered the WTO in 2001, China forked out only US$1.9 billion to foreign IP owners, but the amount had risen to $28.6 billion by 2017. Certainly, we should intensify IP protection. President Xi said property protection, especially IP protection, is important in building a good business environment. We should introduce harsher punishments for IP infringements and make the violators pay a higher price. Despite the progress we have made, we will endeavor to improve our protection of intellectual property. China cannot accept the practices of some countries that adopt discriminatory measures against China that breach the WTO commitment and its own domestic laws, based on nothing more than groundless reports, accusations and complaints from corporations. It's self-evident who started the "trade war." Thank you.   

China Radio International:

My question is for Mr. Zhu. At the G20 Meeting of Finance Ministers and Central Bank Governors recently concluded in Argentina, the U.S. representative said that China's transition to a market economy is regressing. You were at the meeting. Could you tell us how the Chinese side responded to this view at the meeting? I also heard that the Under Secretary of the Treasury of the United States said the two countries won't have any more comprehensive economic dialogue. Do you accept this view? 

Zhu Guangyao:  

The G20 Meeting of Finance Ministers and Central Bank Governors was held in Buenos Aires on March 19 and 20. Before that, a meeting of their deputies was held. It's true that the U.S. representative mentioned a regression in China's reform. He made the remark when discussing the global economic crisis. As the deputy finance minister of China, I made a speech immediately after him.

In my speech, I first made clear China's perception of the world economy. China believes that after the outbreak of the global financial crisis, the year 2018 has seen the best performance of the world economy. Therefore, it's important for the G20 countries to remain united and to coordinate their policies with each other.  

Then, I mentioned the success China has made after it adopted the reform and opening up policy. When the policy was introduced, China's per capita GNP was US$220. Last year, this figure exceeded US$8,820. The change is remarkable. This is the result of the reform and opening up policy and of the hard work of the Chinese people. When improving their life, the Chinese people have also made great contributions to the world. In the past decades, China accounts for more than 70 percent of poverty reduction worldwide. For many years, China's economic growth accounted for more than 30 percent of the world's total economic growth. These are the achievements of China's reform and opening up policy and the contributions China has made to the world. 

China is going to celebrate the 40th anniversary of the introduction of the reform and opening up policy. New reform and opening up measures will be announced. China will surely become more and more open. We want to have more policy communication with other countries. We welcome more foreign investment in China. We will also increase investment overseas. Our aim is to further integrate the Chinese economy into the world economy. In this context, it's crucial for G20 to enhance policy coordination among member countries, including China and the United States. 

This is generally what I said at the meeting.

The second question pertains to the China-U.S. comprehensive economic dialogue mechanism, which was one of the four important China-U.S. dialogue mechanisms that Chinese President Xi Jinping and his counterpart Donald Trump initiated during their meeting at Mar-a-Lago on April 6, 2017. It is actually a continuation of the China-U.S. Strategic Economic Dialogue and the China-U.S. Strategic and Economic Dialogue, but bears the hallmark of the Trump administration. The dialogue mechanism has led to very productive cooperation, including the early-stage outcomes achieved under the China-U.S. 100-day economic cooperation plan. I remember, in May last year, in this room, I answered questions from the press, including a CNN journalist. In this situation, we should cherish the cooperative relationship already established between the two countries. Coincidently, on that very day, after the press conference, the U.S. Deputy Treasury Secretary said in an email to me that it was wrong to say that China-U.S. comprehensive economic dialogue was dead and that the U.S. cherished high-level dialogue with China, referring to a report. You can verify this. Since the two parties keep close policy communication, important information may need to be exchanged at any time. I can tell you that my reply to his email was, "I also value your message and will report this message to my superiors."

The divide on China-U.S. economic ties, in my opinion, is partly a reflection of the expectation for a more open market as well as a better business environment from each other, and partly a reflection of the aspiration for cooperation in the market. Otherwise, we can just go our own way and ignore the issues on the agenda. The challenges facing us are real, but I think the two countries have the wisdom and capabilities to solve these issues, because we have shared interests that derive from one another's interests. China and the U.S. have more shared than divergent interests, and that is the reason for this. The two countries have US$580 billion worth of trade volume and 230 billion worth of direct investment, in addition to the U.S bonds held by the Chinese government (valued at US$1.1-1.2 trillion according to the U.S. Treasury) as mentioned by the Wall Street Journal. Beyond that, the two countries enjoy the friendship between their people and build up mutual trust. China and the U.S. are two great countries and the people of the two countries are great people. Win-win cooperation is what we both desire. Thank you. 

China Business Network：

I have a question for Vice Minister Wang Shouwen. WTO Director-General Roberto Azevêdo said recently that a trade war between China and the U.S. would have a grave impact on the global economy and that the WTO was facing a most difficult moment. Some other experts believe that third countries would suffer most from the trade war. Has China assessed the effects of the trade war on both itself and the world? Faced with the current external environment, will China push ahead with further opening up? Thank you.

Wang Shouwen: 

Thank you for your question. Indeed, Director-General Azevêdo's words are very reasonable. No one will emerge a winner from a trade war. This is why China, as a responsible country and WTO member, doesn't want a trade war. China is willing to discuss and settle all disputes with the U.S. based on equality, consultation and mutual respect in line with WTO rules, which are widely agreed on. However, if China's interests are hurt and its economic security is endangered, we will take all necessary measures to defend our legitimate interests in accordance with the spirit of international law and the stipulation of China's Foreign Trade Law. Of course, we hope all the so-called disputes can be settled within the WTO framework, so that we can minimize damage to the WTO system and to the interests of all parties. But if someone is determined to wage a trade war, China will not be afraid. As I mentioned just now, China will fight to the end if a trade war is initiated, while also keeping the door to dialogue and consultation open. China is willing to openly exchange views with the U.S. on handling differences within the WTO or bilateral framework for mutual benefit and win-win results. Thank you.

Reuters:

Are the U.S. trade measures beyond China's initial expectation? Will the RMB exchange rate be a topic during the negotiations between China and the U.S.? Thank you.

Zhu Guangyao:

China and the United States keep close communication; even facing severe differences, we still maintain policy communication. China has made its principle clear. The Chinese Ministry of Commerce, representing the position of the Chinese government, clearly stated that we will not negotiate under the Section 301 framework. This is a basic principle, because the U.S. action is a unilateral one. We hope that the two sides can clearly put forward their policy requirements  and seek new ways to solve the problem based on the principle of mutual respect. The most important thing is mutual respect, and then we can achieve win-win cooperation. 

Both of us have the responsibilities and obligations to manage our expectations, because China and the United States are the two largest economies in the world, and their policies not only have a major impact on their respective economies, but also have a major impact on the global economy. The global multilateral system must be maintained by all WTO members. In this process, both China and the United States have significant responsibilities. In this process, all countries must realize that hegemonism and unilateralism are unpopular. In safeguarding the multilateral system, we must work together because the United States has always played a leading role in the global economic system that has been established since World War II. China is an important participant, builder, and contributor to this system, and of course, it is also a beneficiary. We are willing to work with all of you to maintain this multilateral system through cooperation – constructive cooperation – so that our global economy can move forward and develop in a healthy and stable manner.

Regarding the exchange rate issue, the IMF recently made a very clear definition of the exchange rate, including the fundamentals of the economy, sound macroeconomic policies and sound mechanisms. Under this premise, the determination of exchange rates reflects the strength of the market. I think that China and the U.S., as important members of the International Monetary Fund and important participants and defenders of the international financial market, both shoulder common responsibilities. Cooperation in this area is conducive to the stability of the financial market, helps prevent possible systemic financial risks and contributes to the healthy and sustainable development of the world economy. Thank you.

CRNTT:

My question is for Mr. Zhu. Will this round of trade friction between China and the United States impact China's GDP growth target this year? If yes, how big will the influence be? 

Zhu Guangyao:

The Chinese economy has maintained stable growth in recent years. Both the 19th CPC National Congress and the government work report delivered by Premier Li Keqiang at this year's two sessions made clear that the Chinese economy has shifted from fast growth to high quality development. This is in accordance with the principle of pursuing progress while ensuring stability. It's very important for China to upgrade its economy, give priority to performance and therefore maintain sound and sustainable development. 

The Central Committee of the CPC and the State Council have made it clear that guided by this basic principle, we must unswervingly implement the supply-side structural reforms, focusing on the supply-side structural reform to push the three major tasks. 

The three major tasks, also tasks for the next three years, are preventing systemic financial risks, reducing poverty and controlling pollution. These three major tasks are related to the stability of our economic system and quality of our people's lives. The International Monetary Fund (IMF) has made consecutive upward revisions of its forecast for China's economic growth. The fund expects China's economy to expand by 6.6 percent this year, higher than the 6.5 percent target announced by Premier Li Keqiang during his government work report presentation at the opening meeting of the first session of the 13th National People's Congress.

The IMF had an overall assessment. According to its 6.6 percent forecast, if China maintains a three-year average growth rate of 6.3 percent in 2018, 2019, and 2020, China will double its 2010 GDP by 2020. Therefore, we are fully confident that we will achieve our goal of doubling the size of China's economy by 2020. In 2017, China's per capita GNP reached US$ 8,820. The World Bank's middle-income standard is US$12,700. We can certainly cross the middle-income line if China develops at this speed.

Therefore, we do not want China and the United States to have a "trade war," yet now we are indeed threatened by serious trade frictions. Both sides should calm down and explore a new path through cooperation and mutual respect, and we must gradually come up with a way to mitigate the imbalance in Sino-U.S. trade during the process of cooperation. China has made clear that we do not pursue a trade surplus and we hope bilateral trade will gradually come to a balance in the process of cooperation. At the same time, in a win-win situation, China and the United States can realize the harmonious coexistence of their economies, work together to improve people's well being, and jointly promote the peaceful development of the world. Thank you.

Hu Kaihong:

This concludes today's briefing. Thank you, Mr. Zhu and Mr. Wang. Thank you, friends from the press.

Read in Chinese

Speakers:

Chen Zongrong, former vice administrator of State Administration for Religious Affairs

Xiao Hong, former spokeswoman of State Administration for Religious Affairs

Chairperson:

Xi Yanchun, spokeswoman of the State Council Information Office

Date:

April 3, 2018

Xi Yanchun:

Ladies and gentlemen, good morning. Welcome to this press conference. Today, the State Council Information Office released the white paper "China's Policy and Practice in Protecting the Freedom of Religious Belief."

We are delighted to invite Mr. Chen Zongrong, former vice administrator of the State Administration for Religious Affairs, and Ms. Xiao Hong, former spokesperson of the administration, to attend this press conference. Now, I'll give a brief introduction to the white paper.

This is China's second white paper on the protection of the freedom of religious belief since 1997. It provides sufficient information and data on the efforts and progress China has made in the past four decades, especially after the 18th National Congress of the Communist Party of China. The white paper contains approximately 8,000 words. The main content is divided into five parts: I. Basic Policies in Protecting Freedom of Religious Belief; II. Legal Guarantees for Freedom of Religious Belief; III. Conducting Religious Activities in an Orderly Manner; IV. The Role of Religious Groups Has Been Fully Developed; V. Active and Healthy Religious Relations

The white paper says that religion is an integral part of human civilization. It remains a common problem for all countries of the world on how to protect the freedom of religious belief, how to properly handle the relations between different religions, how to help religions cope with changing time, and how to curb religious extremism. Based on the development of religions and on the practical works related to religions, by reviewing positive and negative experiences in China and other countries, China has found a proper way to protect the freedom of religious belief, promote harmonious development of different religions, and give full play to the role of the religious circle in compliance with law. We will continue to respect and protect the freedom of religious belief of Chinese citizens, and unite religious believers and non-believers.

The white paper is available in multiple languages, including Chinese, English, French, Russian, Spanish and Arabic. 

Now, I'll give the floor to Mr. Chen.

Chen Zongrong:

Ladies and gentlemen, friends:

Good morning!

It's a pleasure to meet you all here, and thanks for paying attention to the conditions of religion in China and China's policies for religious affairs.

The State Council Information Office published "Freedom of Religious Belief in China" in October, 1997, which introduced China's basic policies and legal guarantees for freedom of religious belief for the first time. For over 20 years, China has made great strides in policies and practices on protecting the freedom of religious belief. With all of the experiences gathered from practice, we have developed policies on protecting the freedom of religious belief with Chinese characteristics. Before answering the questions, I would like to brief you on the four aspects of the characteristics:

Firstly, freedom of religious belief in China is deeply rooted in China's long history.

China is a country with a great diversity of religious beliefs since ancient times. Besides the main religions that are well organized and systematically developed, there are also plenty of local beliefs. Religions in China, except for Taoism and local beliefs, were introduced into China from overseas. Due to the influence of Chinese traditional culture, religions in China have developed unique characteristics featuring patriotism, reason, humanism, tolerance and others, which are presented in a different way compared to the religions developed under the background of western culture. Compared to some other countries and regions in the world, there are no religious wars or chaos caused by religious problems in China's history. 

Secondly, freedom of religious belief in China benefits from legal protection.

China's policies and legal protections for religious affairs is unique in four aspects. The first word to summarize is objective. The nature of religious beliefs is fully respected. We treat religious affairs with an objective attitude and see it as a common social phenomenon. We respect and protect citizen's religious feelings and needs, instead of setting standards with one's individual will. 

The second word to summarize is fair. All religious beliefs are treated as equals in China. No religion will be given special treatment with regard to policies and law. As for people, no matter if they have a religious belief or not, they are ensured the same rights and obligations. 

The third word is balance. Chinese people have the right to have a religious belief or not, and also the rights to choose what kind of religions to believe. We protect people who don't have religious belief before and now who are choosing to have one, and also the people who have religious beliefs before and now no longer have any beliefs. We respect and protect the freedom of religious belief of people who live in the regions where most people don't have religious beliefs, and also the freedom of religious belief of people who live in the regions where most people have religious beliefs. 

The last word to describe the characteristics is comprehensive. We protect the legal religious activities and take measures to stop the illegal religious activities. We take measures against the propagation and spread of religious extremism, and crack down on crimes.  

China's policies and legal protections for religious affairs is unique in four aspects. The first word to summarize is objective. The nature of religious beliefs is fully respected. We treat religious affairs with an objective attitude and see it as a common social phenomenon. We respect and protect citizen's religious feelings and needs, instead of setting standards with one's individual will. 

The second word to summarize is fair. All religious beliefs are treated as equals in China. No religion will be given special treatment with regard to policies and law. As for people, no matter if they have a religious belief or not, they are ensured the same rights and obligations. 

The third word is balance. Chinese people have the right to have a religious belief or not, and also the rights to choose what kind of religions to believe. We protect people who don't have religious belief before and now who are choosing to have one, and also the people who have religious beliefs before and now no longer have any beliefs. We respect and protect the freedom of religious belief of people who live in the regions where most people don't have religious beliefs, and also the freedom of religious belief of people who live in the regions where most people have religious beliefs. 

The last word to describe the characteristics is comprehensive. We protect the legal religious activities and take measures to stop the illegal religious activities. We take measures against the propagation and spread of religious extremism, and crack down on crimes.  

Thirdly, freedom of religious belief in China develops from the practice of religious affairs.

The Communist Party of China (CPC) and the Chinese government attach great importance to religious affairs and see it as a significant issue facing China. In an effort to protect freedom of religious belief, China has mulled over policies, laws and regulations, and established professional institutions to properly handle religious affairs, in a bid to adapt to the times. Especially since the 18th CPC National Congress, under the leadership of the CPC Central Committee with Comrade Xi Jinping at its core, religious affairs have been put high on the agenda.

China has held the national conference on religious affairs, revised the Regulation on Religious Affairs and optimized the working system, building an orderly, free, stable and harmonious community. China will uphold the principle that religions in China must be Chinese in orientation. China will build active and healthy religious relationships, and maintain religious and social harmony. All these will lay solid foundations for handling the religious affairs and protecting the freedom of religious belief in the new era.

Fourth, China's gains in protecting freedom of religious belief are a result of the self-reflection, self-reliance and self-improvement of the religious community.

With the implementation of the policies on freedom of religious belief, China's religious community has stepped up efforts in community building, the awareness of citizenship, laws and politics among religious personages and believers have increased substantially, the self-management of religious organizations has further improved, the adaptation between religions and socialist society continues to get deeper, different religions respect and learn from each other, and a new realm of "five religions (Buddhism, Taoism, Islam, Catholicism and Protestantism) working together to achieve harmony" has taken shape. 

First, speaking overall, religions in China are turning from the pursuit of quantity to the pursuit of quality, focusing on developing in the Chinese context, and working hard to strengthen theories, culture, institutions, organizations and talent cultivation. 

Second, they serve society, engage in public welfare and charity activities, and do lots of work in helping those in need and distress, winning wide praise from society. 

Third, they assume social responsibilities, conscientiously maintain harmony among religions and society, safeguard national security and ethnic solidarity, take a clear stand and draw a line against religious extremists, fight against illegal and criminal activities under the guise of religion, and serve as an important force to promote economic and social development. 

Fourth, they carry out extensive international exchanges, take an active part in exchanges among people with different beliefs and different civilizations, promote closer ties between people, the linking up of cultures and mutual learning among civilizations, and contribute strength and wisdom to maintaining world peace and building a community with a shared future for mankind.

In short, China's policies on freedom of religious belief are sincere, conform to its national conditions and are effective. We have our own experience in protecting freedom of religious belief.

Xi Yanchun:

Thanks for the introduction of Mr. Chen. Now let's move on to the Q&A session. 

CCTV: 

What are the considerations behind the publishing of the white paper? Thank you.

Chen Zongrong:

Our first white paper on freedom of religious belief was released in October 1997, and now, over 20 years have passed. The 1997 white paper gave a comprehensive introduction to China's respect for and protection of freedom of religious belief with a large number of facts, including full and accurate data, and thus served as an authoritative source of information for the international community to know about China's religions and religious policies.

China has undergone fast and considerable changes over the past 20 years in its economic and social development and religious situation. The five main religions in China have also undergone great changes, and as I mentioned, are turning from a pursuit of quantity to a pursuit of quality. Therefore, we think it is necessary to publish another white paper to introduce the development and changes of religions in China over the past 20 years, especially to introduce the protection of freedom of religious belief, promotion of harmonious religious relationships, and self-improvement of the five main religions in recent years, and also, to elaborate some of our viewpoints. 

Publishing the white paper also shows that the Communist Party of China and the Chinese government attach great importance to protecting and promoting human rights, and that it has the sincere wish to advocate dialogue and oppose confrontation in the field of international human rights.

Thank you. 

Reuters:

My question is about the potential deal with the Vatican. There has been a lot of discussions regarding the deal over the appointment of bishops. I want to know if that's likely to be signed and released any time soon. If it isn't, what is the largest obstacle at the moment to reach such a deal? Thank you.

Chen Zongrong:

My colleague Ms. Xiao will answer this question.

Xiao Hong:

China and the Vatican have maintained contact and the two sides have actively engaged in profound discussions about certain issues. China has always been sincere in wanting to improve relations with the Vatican and has continued to make efforts. We are willing to work in the same direction with the Vatican in pushing forward constructive dialogue to improve relations with the Vatican.

People's Daily:

There have been some concern that China has been tightening its religious policy after the conference on religion in 2016. What is your response? Are there any changes in China's policy toward religion?

Chen Zongrong:

As I said earlier, the National Work Conference on Religion in 2016 is an important event on religious affairs 15 years after the 2001 meeting. While addressing the conference, Xi Jinping, general secretary of the CPC Central Committee, put forward a series of new thoughts and requirements. After the conference, we have heard some concerns questioning if China is tightening its religious policy. I would like to take this opportunity to make my points in the following two aspects.

First, China's religious policy is stable and consistent. Since the reform and opening up in 1978 when China resumed to implement its policy of freedom of religious belief, China's religious policy has been sticking to some core values as well as basic values, ideas, and principles, which is to protect people's freedom of religious belief and safeguard their rights to freedom of religious belief. The Communist Party of China (CPC) has been following this basic policy of protecting the people's rights to freedom of religious belief. The country has also included it into the Constitution, which can be seen in the 36th article. This core value, basic principle and the basic policy have been stable and consistent.

Second, China's religious policy as well as laws and regulations regarding to religious affairs is also gradually improving and innovating, which is exemplified by Xi's important speech during the 2016 conference and the revised Regulations on Religious Affairs. The revision of policies and laws regarding religious affairs is to meet new situations and address new problems. We should protect, regulate, guide and serve religious development but never aim to control it. Moreover, we should uphold the principle that religions in China must be Chinese in orientation and work to ensure that the five major religions (Buddhism, Taoism, Islam, Catholicism and Protestantism) can better adapt themselves to the socialist society.

We also aim to build a positive and healthy religious relation. The five major religions are already working in harmony, but some new situations and problems occurred under certain international and domestic contexts. 

It also mentioned that the rule of law shall be enhanced in addressing religious affairs. The newly-revised Regulations on Religious Affairs have included many parts to protect people's rights to freedom of religious belief and the lawful rights and interests of the religious circles. For example, it stipulates that governments of all levels should provide public services for religious circles including making road links, electricity, water, radio and TV broadcasting available for religious sites. 

The regulation also said that religious workers enjoy social security benefits like old-age insurance and healthcare insurance equal to other Chinese citizens. They can also enjoy subsistence allowances (if eligible).

The regulation stipulated that religious sites and institutions can obtain legal person status. In the past, the lawful rights and interests of religious sites was not well-protected and were sometimes infringed because their property could not be registered under their names without a legal person status. 

The construction of religious sites is also included into the master plan of land use in urban and rural areas. This move makes sure that the construction of religious sites will be considered during preliminary planning of land use and that religious believers can have adequate space for religious activities.

Therefore, China's religious policy is not only stable and consistent, but also keeps adjusting for new practices and requirements. In explaining its religious policies, the CPC Central Committee and the Chinese government are more explicit in attitude, more powerful in its measures, and more adapted to requirements of the new era.

Thank you.

Second German Television (ZDF):

Is it to be expected that there will be a solution on the negotiations between the Vatican and Chinese government to be more concrete on who's going to decide on the bishops and what's going to happen with the so-called "underground church"? 

Chen Zongrong:

Please let Ms. Xiao Hong answer this question for you.

Xiao Hong:

It seems that everyone is very concerned about Sino-Vatican relations. I can understand that your attention actually represents the concern of the broader audience behind you. I also thank you very much for your attention to Chinese religions and Sino-Vatican relations. However, regarding these specific aspects of the content of Sino-Vatican relations, I have nothing to add. But as you are a reporter from a German television station, I can tell you something about the exchanges between China and Germany. In 2016, we conducted a dialogue on different religions and civilizations with the German Christian community. The results were very good. We have reached an agreement that we will continue to hold such dialogues, the next of which will be in Shanghai in May this year, and we welcome you to attend. Thank you.

China News Service:

According to the white paper, there are nearly 200 million religious citizens in China, which is a great increase from the 100 million people in the 1997 white paper. Why and how did this happen? Thank you.

Chen Zongrong:

The figure of 100 million people in the 1997 white paper was actually from the estimates by the late Premier Zhou Enlai when he met with Pakistani and Indonesian Islamic delegations in the 1950s. He said at the time that there were several tens of millions of religious followers in China, and if they added those who held beliefs in their hearts instead of going to temples, all of them could make up almost 100 million people. From that time until the publication of the white paper in 1997, we all cited the saying of Premier Zhou. I want to explain two points on this issue:

First, the statement itself is an estimated statistic. It is an approximate figure. At that time, China's total population was more than 600 million. From the 1950s to the present, the total population of China has more than doubled. With more than 1.3 billion people, the population has grown substantially. For various reasons, after so many years of development, coupled with population growth, it is natural for the number of religious believers to grow.

Second, especially after reform and opening up was implemented, China has restored its policy of freedom of religion. As the breadth and depth of opening up to the outside world have been enlarging, all religions have had some growth respectively. It is very natural. Therefore, to still use the saying from the 1950s is not in line with the development in reality. Now the number of nearly 200 million people in the white paper is the number offered by the five major religions in China, which conducted statistics on their own, while we had data from the academic research institutions, statistical agencies, and sample surveys. The number was agreed on and recognized by various parties after we compared data from the two main sources (religions' own math and civil survey data). The nearly 200 million people are the number of religious followers who basically often go to religious sites and participate in religious activities.

That's all for this question. Thank you.

The Wall Street Journal:

I would like to add to the question regarding the relations between China and the Vatican. Currently, many experts have pointed out that the opportunity to solve the problem is in the hands of the Chinese side, and the Vatican is waiting for the final confirmation to be made by the Chinese side. So, why hasn't the Chinese side made a final confirmation about the settlement of the issue? And what is the reason? Thanks.

Chen Zongrong:

Ms. Xiao has been asked twice about the issue of China-Vatican relations. Here, I would like to explain it again, aiming to answer the question you have just raised.

To improve China-Vatican relations is the common aim of both sides. From the government perspective, we always maintain a sincere hope to improve bilateral relations, and the Chinese government has made specific efforts in this regard. Presently, China and the Vatican have an effective channel for dialogue, and all the issues will be negotiated and discussed through this channel.

So, here we also hope that the Vatican will be able to work together with the Chinese government to further improve bilateral relations. And this is also the point I want to stress about China-Vatican relations. Thanks.

Hong Kong Wen Wei Po:

The behavior of some Buddhists who obtain wealth by unfair means has generated negative influence. I'm wondering what measures you have taken to address the situation of the commercialization of Buddhism and Taoism. Thank you.

Chen Zongrong:

The commercialization of Buddhism and Taoism is an issue which attracts wide attention. The increasing commercialization is reflected in the following four aspects:

First, accumulating money by investing in construction of large-scale open air religious statues and temples. Second, contracting Buddhist and Taoist temples to the capital market and even planning to list them in the stock market. Third, conducting religious services in places other than Buddhist or Taoist temples in order to make money by collecting admission tickets and alms, establishing boxes of merits, and conducting unregulated activities like burning incense and freeing captive animals. Fourth, some Buddhist monks and Taoist priests have a loose sense in discipline and chase after fame and wealth under the influence of commercialization. They try to gain money through any possible means.

Criticized by the whole of society, these commercialized activities also hurt the development of religions. First, they damage the legitimate interests of Buddhism and Taoism by drawing in believers who offer alms to false monks and priests or those who make money from the temples. Second, they taint the image of the religions, because seeking fame and fortune goes against religious ethics. Third, they hinder the sound development of the religions. If such activities continue, the religions will lose believers and eventually imperil their existence and development. Therefore, to answer the calls of the religious circles as well as the whole of society, the Communist Party of China (CPC) and Chinese government have attached great importance to tackling the commercialization of Buddhism and Taoism. 

We have taken the following measures. First, the State Administration of Religious Affairs has released several documents jointly with other central departments, specifying the limits of commercialization and defining wrongdoings. Second, we have stepped up supervision. We have supervised the investigation of major cases and exposed them to the public. Also, we have cooperated with related departments to carry out inspections and ordered the violators to rectify offenses. Third, we have carried out dedicated initiatives to deal with illegal activities. For example, we have intensified efforts to tackle illegal Buddhist statues. As we know, there are many substandard Buddhist statues built without approval. They are not in accordance with religious rites and only built to make money. We have dealt with the issue of illegal merit boxes established in non-religious places. Fourth, we have published the information of Buddhist and Taoist temples on the internet. Meanwhile, registered temples will put up a sign, enabling the public to differentiate them from fake ones. We have guided believers and followers to conduct religious practices in a proper way and develop a healthy atmosphere for practicing. All those efforts have to some extent curbed the commercialization trend. However, there is still a long way to go to entirely curtail such activities, but hopefully with the cooperation of society as a whole, and media as well, we can get this work done. Thank you.

CRNTT:

According to the plan on deepening reform of Party and state institutions released by the Communist Party of China (CPC) Central Committee, the United Front Work Department of the CPC Central Committee administrates religious affairs. I would like to ask why such reforms have been made. What kind of influence will this have on the freedom of religious belief and religious activities of citizens after the reform? Thank you.

Chen Zongrong:

I am attending today's press conference as former vice administrator of the State Administration for Religious Affairs. The State Administration for Religious Affairs has been incorporated into the United Front Work Department of the CPC Central Committee. We are in a process of adjustment. Officials at the director level and above from the United Front Work Department of the CPC Central Committee, the State Administration for Religious Affairs and the Overseas Chinese Affairs Office of the State Council assembled on the morning of April 1 to announce the formation of the new department. The integration of the State Administration for Religious Affairs and the Overseas Chinese Affairs Office of the State Council into the United Front Work Department of the CPC Central Committee and the formation of the new leadership of the United Front Work Department of the CPC Central Committee mark the formation of the new department. My original title has expired, and the new title has yet to be announced. That's the reason I am attending the press conference as former vice administrator of the State Administration for Religious Affairs.

According to the institutional reform plan, the State Administration for Religious Affairs was incorporated into the United Front Work Department of the CPC Central Committee, which demonstrates the strengthening of the Party's centralized, unified leadership over religious work. The aim is to fully implement the Party's basic policy on religious affairs, uphold the principle that religions in China must be Chinese in orientation, and coordinate the United Front and religious resources. The reform will actively guide religions to adapt to China's socialist society. These words I just said are quoted from the plan on deepening reform of Party and state institutions. They are also the purpose and significance of the reform. I think this reform can produce the following benefits:

The reform is conducive to optimizing the institutional mechanisms for religious work, raising the level of religious work, and increasing the work force in religious work. Before the integration, the domain of the functions of the United Front Work Department of the CPC Central Committee overlapped with that of the State Administration for Religious Affairs. The reform will help streamline the regulatory system and better coordinate the strengths of the two. With an optimized institutional mechanism, improved governance level, and strengthened workforce of religious work, we will be able to better safeguard the legitimate rights and interests of the religious community, guarantee citizens' freedom of religious belief, standardize the management of religious affairs, and promote social and religious harmony. Therefore, the reform will only benefit religious work without affecting it.

For the Communist Party of China, advocating atheism and guaranteeing freedom of religious belief are both part of the Party's claims and work requirements. The CPC advocates atheism and advocates the promotion of atheism, but it does not mean that the freedom of religious belief of citizens cannot be guaranteed, nor does it mean that citizens' freedom of religious belief cannot be respected. The relationship between the CPC and the religious community is solidarity and cooperation on politics and mutual respect of beliefs. No matter how the religious institutions change, the CPC's policy of guaranteeing freedom of religious belief will not change. I think the reform will be more and more beneficial to religious work, and better protect the freedom of religious belief of the citizens. Thanks.

Xi Yanchun:

We moved from talking about the white paper to the China-Vatican relationship to institutional reforms. Do you have any questions about the white paper?

Hong Kong Cable Television:

The white paper has a newly added part that religions in China must be Chinese in orientation. The religious circles will make efforts to expound doctrine to conform to China's situation and times. If there are conflicts between the newly added part and doctrine, what will you do? Catholic community encourages the running of its religious work in a democratic manner. How is this done?

Chen Zongrong:

What do you mean by the conflicts you just mentioned?

Hong Kong Cable Television:

There is the explanation of being Chinese. However, many religions have their own explanation on principles. For example, Catholicism has its own doctrine for electing new bishops. What will be done in case of conflicts? 

Chen Zongrong:

Religions in China must be Chinese in orientation, which is a policy first presented by Chinese President Xi Jinping at the Central United Front Work Conference in 2015. It was further stressed at the national religious work conference in 2016 and later included in Party documents as a basic policy of the Party on religious work. Why do we specify that religions in China must be Chinese in orientation? It is the rule every religion follows that religions are adapted to context. All religions, without exception, follow this rule. If not, the religion can't live or develop. I think numerous examples have demonstrated this, whether in China or in the rest of the world.

The Party was not the first to propose that religions in China must be Chinese in orientation. Before President Xi presented this, the Catholic community had expressed that Christianity must be Chinese in orientation and made positive contributions. I was in charge of the Christian work before. The Christians held a workshop on Christianity for a Chinese context in Shanghai sometime before 2015, which produced great results. Therefore, the policy follows the objective law of religious development in line with development of the times. It has received enthusiastic response and support in religious circles. Jointly or on their own, they have hosted series of seminars and forums to explore the connotation and direction of being Chinese, with the goal of solving issues including the one you mentioned just now.

I would like to point out that we uphold the principle that religions in China must be Chinese in orientation, but this will not change the basic religious doctrine and can never conflict with it, because the policy cannot change the core religious doctrine, manner or system. On the premise that all of these core elements remain the same, the policy provides guidance to religions in adapting to the Chinese context politically, socially and culturally. In the political field, religious circles will be provided guidance to support the leadership of the Chinese Communist Party and socialist system. These are the prerequisite for building up our country with secular people and realizing the Chinese Dream of national rejuvenation. In the social field, religious circles will be provided guidance to follow and serve society and fulfill responsibilities to the society. Religions are organic parts of society, so they should serve the society and be in harmony. In the cultural field, the expression of religious thought, manner, architectural style and art should be Chinese. I think no religion is exactly the same in different countries, regions and ethnicities. They all have their own characters. This is the case in the three worldwide religions of Christianity, Islam and Buddhism. Therefore, the policy is an effective measure to provide better guidance for the adaptation of religions to a socialist society, and it is widely accepted and there is little opposition.

In addition, you mentioned that Catholic community encourages the running of its religious work in a democratic manner. This is an important aspect of Catholicism being Chinese. However, it is the tradition of Catholicism historically. It does not change the core doctrine and system, but opposes the practice of "only one man's words count," making democratic decisions through the collective. I think this is also the tradition of Catholicism in other countries and throughout its history.

This is my answer, thank you! 

China Radio International (CRI): 

Revised regulations on religious affairs went into effect in February this year. Why was the old document revised, and what are the features of the new one? Thank you.

Chen Zongrong:

The revised regulations on religious affairs were released on Sept. 7 last year. The original document was released on Nov. 30, 2004.

Since March 1, 2005 when the old regulations went in to effect, great changes have taken place in China's religious conditions as well as its international and domestic environments in over a decade. But the document was no longer in keeping with the changing situation and failed to solve new problems. For example, it didn't address online religious affairs, legal-entity status of a religious community based on its religious venue or other new issues.

In addition, since the 18th CPC National Congress, the CPC Central Committee has attached greater importance to work related to religious affairs and made new requirements based on new situations and tasks. Those new requirements and duties needed to be included in the regulations to align them with the will of our country. 

What's more, China has been advancing law-based governance, which requires sound lawmaking in all fields. Thus, the old regulations, which had some defects, needed to be revised.

The revised document has three distinct features. First, it better reflects the principle of protecting citizens' right to freedom of religious belief in accordance with law. For example, as I mentioned just now, it stipulates that governments at all levels should provide public services for religious groups and include the construction of religious sites into general plans for land utilization, as well as plans for urban and rural development. The list of such examples is long, and today I don't have time to talk more about them. You can refer to the document for more information. 

Second, the revisions better reflect the principle of promoting religious harmony as well as maintaining national security, social stability and ethnic unity. Some people in certain regions are making use of religion to undermine ethnic unity, social stability and national security. In this context, the revised document offers better approaches to promoting religious harmony. For example, it has made clear that religious affairs should be managed in compliance with the principles of "protecting the legal, stopping the illegal, containing the extreme, resisting infiltration and combating crimes." This means that we will resolutely protect legality, and take tough measures to punish those activities that undermine social stability and ethnic unity.

Third, the new regulations better reflect the principle of promoting law-based government administration and building a rule of law government. Advancing law-based governance in all fields requires building a government and a society based on the rule of law. In managing religious affairs, we also should observe the law, and must not act beyond the law and its regulations. The revised document has prescribed more appropriate measures and legal procedures in this regard, and clearly defined functions, duties, obligations and powers for relevant government institutions in managing religious affairs. 

Therefore, the revised regulations can protect a wider range of legal religious activities with more intensive efforts and stop illegal activities through more targeted and effective measures. I think this is the most prominent feature.

Phoenix Satellite Television:

My question is for Mr. Chen. We have noted the issue that for various reasons, there are some underground churches and family churches in China, and many analysts describe them as a gray elephant in Chinese religion. However, we actually haven't seen any related information in this white paper. We would like to ask about how the Chinese government considers this issue. Is there any related information? How will the issue be addressed in the future? Thanks.

Chen Zongrong:

I need to make one point clear here. There are neither underground churches nor family churches in China. My understanding is that, the family churches you spoke of refer to the venues for religious activities privately set up by the Christian churches. From this perspective, the number is not small indeed, because it is related to the characteristics of Christianity itself. 

Regarding the venues for religious activities privately set up by the Christian churches, the measures we have taken is to use the influence of a church to guide a number of nearby venues for religious activities. In this way, we can provide effective religious services and religious guidance for the people who gather in these venues to live a religious life, and thus to meet their reasonable needs for religion.

Second, Article 35 of the Regulations on Religious Affairs amended this time has made one point clear over the question of: if presently there are no conditions for the establishment of venues for religious activities while religious believers have a need for a religious life? Here is the solution. Religious believers can select representatives who will apply to the religious affairs department of the people's government at the county level for the establishment of a temporary venue for religious activities, therefore to meet these religious believers' need for a venue to live a religious life.

The Regulations also make it clear that local religious groups, such as the China Christian Council and the National Committee of the Three-Self Patriotic Movement of the Protestant Churches in China, provide all possible services for religious believers who gather in the temporary venues for religious activities.

Lianhe Zaobao:

My question is regarding the appointment of bishops. Some Catholics feel their freedom of religious belief is being hampered because the government won't allow the Pope to appoint bishops in China. What's your opinion on this view? Why does the Chinese government think that it should have the right to appoint bishops? Thank you.

Chen Zongrong:

China's Constitution has clear stipulations in this regard. China's religious organizations and affairs are not subject to any foreign domination. This means no foreign entities should interfere in China's religious affairs by any means. Chinese religious circles adhere to the principle of independence and self-management of religious affairs. I can't agree with the view you just mentioned. The freedom of religious belief is not hampered in the religious activities of Catholics in China.

Thank you.

Xi Yanchun:

Thank you all. This is the end of the press conference.